Tax department urges 30-day appeal window for land use change tax valuations

Jill Remick, director of Property Evaluation and Review at the Vermont Department of Taxes, told the committee the current 14‑day appeal window for land use change tax valuations is too short and proposed extending it to 30 days to give landowners time to review valuations and, if needed, appeal to municipal assessing officials.

Remick said the current process requires a local assessing official to value the portion of a parcel removed from the current‑use program and that the taxpayer then has only 14 days to appeal that valuation. "14 days is not enough time to receive it, review it, talk to your forester, talk to your attorney, you know, consider whether that value is appropriate," she told the committee.

The department framed the change as an administrative fix rather than a policy shift. Under current law the land use change tax is a 10% penalty on the appraised value of the withdrawn portion; municipalities perform the valuation and receive up to 50% of the remitted tax (capped at $2,000) as compensation for the lister's work. Remick said the short window produces misdirected appeals to the state department because taxpayers often receive a bill from the Tax Department after the municipal valuation notice and then use the department's general appeal form.

Remick said the department asks the committee to (1) extend the appeal timeline from 14 to 30 days for appeals of a municipal valuation and (2) allow the department to issue a valuation and bill if a municipality fails to provide a valuation within that 30‑day window. She said the second measure would be used sparingly and only after repeated outreach: "if we've hit 30 days ... if we have 35 days and we've called and we've emailed and we've asked, and we don't have a number we'd like to be able to give the taxpayer an answer," she said.

Legislative counsel Kirby (Legislative Counsel) outlined alternative valuation approaches the committee could consider, saying there are tradeoffs between predictability, taxpayer burden and how "punitive" the land use change tax should be. He described three broad approaches: (a) prorating the tax across the entire parcel (the low end of tax liability), (b) the current approach that treats the withdrawn portion as a standalone parcel (the high end), and (c) hybrid formulas such as the "Brighton approach," which the counsel said could sit between the two in tax outcome and be quicker to compute.

Committee members pressed on administrative impacts and equity. Remick said the department has added staff since the 2015 change in valuation method and now spends substantial time managing appeals; she estimated about a quarter of appeals the department receives are appeals of municipal valuations that should have been filed first at the municipal level. She also gave a spot check: the department had 46 outstanding municipal valuation requests and 15 that were over 30 days old. On revenue, Remick said total annual land use change tax receipts were in the low millions ("about 1 and a half million" was discussed in committee), and that the department's cost to administer the tax can exceed revenue in some years because the assessment is a penalty rather than a revenue mechanism.

No formal motion or vote was recorded in the transcript. The committee discussed possible next steps: reviewing draft statutory language the department supplied and returning for additional conversation; Ways and Means was identified as a potential vehicle to carry the change. Remick said Ways and Means "has reinitiated the conversation" and that staff could provide side‑by‑side options for legislative consideration.

The committee did not adopt a change on the record. Members expressed support for more time to appeal as a taxpayer‑friendly change and asked the agency to provide additional scenario analyses comparing proration, Brighton and current law outcomes.

Ending

The committee indicated it may revisit the bill language after the floor session and asked department staff to return with cost‑benefit information and additional scenario runs. No formal vote or legislative action on the proposed language was recorded in the transcript.