Committee reviews H.134 amendment to add land‑use tax abatements and lower farmer income threshold

The Agriculture, Food Resiliency, & Forestry Committee discussed draft amendment 2.4 to H.134 that would add two new abatement paths to Vermont's land use change tax and revise several current‑use rules; the committee did not take a vote and requested additional fiscal and agency review.

The amendment, presented by Kirby Keaton of Legislative Counsel, would add two abatement options for landowners who withdraw land from current use: one targeted at land developed outside the boundary of a Tier 1 growth area that would allow withdrawal of “not more than 2 acres,” and another for land within Tier 1 areas that places no specific acreage limit but requires the withdrawn land to front an existing public road and to be used for specified residential housing types. Keaton summarized the package as “2 types of abatement under this amendment that would be allowed, for land use change tax.” He also noted the proposal places the new language in the existing abatement subsection tied to agricultural land enrollment (A G L A N D).

The amendment also alters the statute’s subdivision definition: a division of a parcel into two or more parcels would be treated as development — and thus could trigger a land use change tax — only if any resulting new parcel both (1) involves a change in use and (2) “does not qualify for enrollment under this chapter,” and one or more resulting parcels contains less than 25 acres. Keaton told the committee that, where a subdivision creates new parcels that are each reenrolled, “both those new parcels need to be reenrolled within 90 days.” The draft sets that reenrollment window at 90 days in several places; current law uses 30 days.

The amendment would also change the definition of “farmer” used in the current‑use chapter by lowering the gross‑income threshold from 50% of a landowner’s annual gross income derived from farm products to 25%. Keaton said the change mirrors language in H.273 that the committee previously reviewed.

Witnesses and committee members raised concerns about how the changes could affect forest land and the current‑use program’s integrity. Keith Thompson, private lands program manager with Forest Parks and Recreation, told the committee that the land use change tax “is really important because it gives the program integrity. It deters casual enrollment of lands that aren't working lands. It deters casual withdrawal of lands that are working lands.” Thompson warned that an everywhere exemption or overly broad abatement could create opportunities to enroll and then subdivide repeatedly — a “Russian doll” effect described by staff — and that even small withdrawals for houses can have outsized impacts on the ability to manage the surrounding working forest (for example, loss of landing sites or access for timber harvests).

Committee members also pressed staff about scope and drafting details. Representative Lipsky flagged a drafting choice Kirby Keaton relied on that currently ties the new abatement language specifically to agricultural land under the existing statute, asking whether the intent was to limit the abatement to Agland rather than to include forest land as well. Keaton acknowledged the statutory text he used pulls in the agriculture‑specific abatement language and noted the committee could redraft if it wanted a broader application.

Members asked for additional analysis before any vote. Keaton and the chair said the Joint Fiscal Office would recheck the fiscal impact numbers the committee had received earlier; Keaton said JFO had been asked to “double check” earlier estimates. The committee scheduled continued consideration and invited additional testimony from Department of Forests, Parks and Recreation (FPR) and other stakeholders.

No formal motion or vote on amendment 2.4 occurred during the hearing. The chair paused the meeting to allow the committee to gather further information and witnesses, and said the panel would reconvene for more discussion and that the clerk would publish any updated draft (e.g., a future draft 3.1) if the committee made changes.

Ending: Committee members said they want more targeted analysis — mapping of eligible parcels inside and outside growth areas, a JFO fiscal recheck, and input from agricultural agencies — before advancing the amendment. For now, the amendment remains under discussion rather than approved.