Agenda - 06-03-1991 - Laserfiche WebLink

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$9,500 per acre. The overall average, however, is in line with the predictions of the Forsyth County program administrator. 4. How will the purchase of development rights be funded? Nationally, purchase of development rights programs have been funded from a variety of sources: State matching funds, real estate transfer taxes, sales taxes, general tax revenues, and bonds. In North Carolina, State matching funds are not available, and specific legislative authority must be granted to use real estate transfer and sales tax revenues. In the absence of such resources, general tax revenues and bonds appear to be the most likely source of local funding. Pay -As -You -Go Program: In Forsyth. County, the Board of Commissioners elected a pay -as- you -go or cash -first program. In the first year, the Board appropriated $1.0 million to fund the program but, in subsequent years, appropriations have not exceeded $500,000. Since the first purchases in 1987, Forsyth County has acquired development rights to 19 farms with a total of 1,192 acres. The County acquired these rights through purchases and leases for a total of $1.71 million. If Orange County were to employ a cash -first program, it might start "modestly" as Forsyth County has done. Given that the level of participation is unknown, one cent of the County tax rate might be earmarked for the PDR program. Based on the current assessed property value and assuming a 98 percent collection rate, the program would be funded during the first year at a level of $357,800. If the value of development rights averaged $2,400 per acre, this would mean that development rights could be purchased on 149 acres. This would be equivalent to one farm a year, based on the average farm size in Orange County in 1987. With property values appreciating over the last five years between three and seven percent annually, one might expect revenues from a one cent tax increase to rise as well. This would enable more development rights to be acquired. This situation would not occur, however, since the value of development rights would appreciate at the same rate as property values. Shown on Table 3 are the revenues to be received over a 20 -year period assuming an annual three percent appreciation rate. Almost $10.0 million would be received and expended to acquire 3,000 acres worth of development. rights. Over the same period, the total cost to a family with a home valued at $100,000 would be $269 or an average of $13 per year. Shown on Table 4 is the same scenario but with an annual appreciation rate of seven percent. Approximately $5.0 million more would be expended to acquire the same amount of development rights, and the cost to the homeowner would increase to $410 or an average of $20 per year. The examples provided in Tables 3 and 4 are indicative of the costs Page - 8