Agenda - 06-03-1991 - Laserfiche WebLink

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In Montgomery County, Maryland, a jurisdiction noted for its agricultural preservation programs (including PDR), $1,500 to $4,000 per acre has been paid for development rights. The average of $3,200 per acre is competitive with appraised PDR values elsewhere in Maryland. As indicated previously, Forsyth County has had a PDR program in effect since 1987. The average price of development rights in that county has been $1,500 per acre. However, the former administrator of the Forsyth County program indicated that recent appraisals show an increase in the average price to $2,500 per acre. He predicted that similar values would be found in the Research Triangle area. Using recent sales and'tax appraisal data on land in Orange County, it is possible to make some assumptions about the value of (cost of purchasing) development rights. However, this information should be viewed as a generalization and should not be presumed to apply to any specific property. Shown on Table 1 is a sampling (14 properties) of land sales involving vacant parcels 25 acres or greater in size. The general location of the parcels is identified on Figure 2. Sales in southern Orange County were generally higher in per - acre price than sales in the northern portion of the county. The average price among the properties sampled was $2,826 per acre and establishes, at least for discussion purposes, an average market value for land in the county. One means of estimating the per -acre value of agricultural land is to use those values assessed to property under the Preferential Assessment /Deferred Taxation Program. The values are based on 10 -year production averages for corn and soybeans under a sound management program. Values are calculated for each of five major soil groups and applied to parcels based on the types of soils present. The values are similar to those derived by actual appraisals, since they are also based on the income potential of the land. Shown on Table 2 are the average agricultural and forestry use values per acre, by township, for parcels in the Preferential Assessment /Deferred Taxation Program. Agricultural use values vary from $495 per acre in Chapel Hill Township to $398 in Cheeks Township. The average agricultural use value for the county as a whole is $427. As indicated previously, the difference between market value and agricultural value is the value of development rights. Using the estimates derived above, the average cost of development rights in Orange County would be approximately $2,400 per acre ($2,826 - $427). Considerable variation could be expected, though, with values ranging from $1,000 to $2,600 in rural areas away from urban areas. Close to municipalities, values would be considerably higher, ranging from $4,500 to Page - 7