Wildlife Operations and the Agriculture Tax Exemption

Attention land owners: Cattle, when managed our way, can actually improve your wildlife habitat. We can show you how. Go to http://www.landandlivestockinternational.com check us out and give us a call.

Insight and Opinion by Jesse Womack via RanchNetwork.com

Currently in Texas a landowner can maintain an agricultural valuation on land for taxes purposes by managing wildlife.   The ripple effects of this policy have broad implications for rural communities and livestock agriculture.

Hunting and outdoor recreation are a boon for Texas ranchers.  In South Texas, one would be hard pressed to find a ranching operation in which livestock and hunting were operated side-by-side and hunting did not account for close to 50% of revenue.  That is a huge help to landowners and, theoretically, should benefit the public by increasing wildlife populations (thus increasing hunting opportunities).  Deer hunting, in particular, has become extremely popular over the past couple of decades and has created an entire industry of deer breeding, herd management and guided hunts.

Any benefits of this policy are outweighed by the negative impacts.  The ability to maintain an agriculture exemption on land for wildlife is a factor in the overall decline of the cowherd in Texas.  That decline has lowered job opportunities in agriculture and lowered revenues for businesses that support livestock agriculture.  Cattle and deer operations can exist on a farm or ranch simultaneously and benefit each other, but the two are increasingly not taking place on the same land at the same time.  Landowners do not have to run livestock on their property anymore to maintain the lower agricultural valuation; so many landowners simply choose not to do so.

The wildlife operation ag exemption also keeps the tax base in rural communities artificially low. Many hunting operations simply act as a tax write-off for wealthy landowners or the wealthy individuals or corporations that lease from them.  They are not meant to make money.  The choice to have a hobby place in the country and not make money from agriculture should obviously be preserved, but, if that is the case, that land should be taxed using normal property tax rates.

This false valuation for tax purposes has contributed to a rise in real estate prices, which increases the barrier to entry into agriculture to possibly unobtainable levels.  Wealthy urban dwellers are willing to pay more for rural land when they realize that they can maintain a lower tax burden just by shooting a few deer or selling a few hunts.  There is no place in Texas left where a young individual can purchase land and pay for it with agriculture alone.  The ability of wildlife operations to maintain agricultural land valuations for tax purposes (while increasing the prices per acre) hurts rural communities and benefits a wealthy few.  It’s time to change this policy so that the benefits flow to those truly engaged in agricultural enterprises.

The author is a founder of RanchNetwork.com and a graduate of TCU’s Ranch Management Program.

About Land & Livestock Interntional, Inc.

Land and Livestock International, Inc. is a leading agribusiness management firm providing a complete line of services to the range livestock industry. We believe that private property is the foundation of America. Private property and free markets go hand in hand—without property there is no freedom. We also believe that free markets, not government intervention, hold the key to natural resource conservation and environmental preservation. No government bureaucrat can (or will) understand and treat the land with as much respect as its owner. The bureaucrat simply does not have the same motives as does the owner of a capital interest in the property. Our specialty is the working livestock ranch simply because there are so many very good reasons for owning such a property. We provide educational, management and consulting services with a focus on ecologically and financially sustainable land management that will enhance natural processes (water and mineral cycles, energy flow and community dynamics) while enhancing profits and steadily building wealth.
This entry was posted in Government Interventionism, Land Values-Buying a Ranch, Managing the Ranch as a Business, Ranch Economics, Resources, Environment and Austrian Economics and tagged , , , , , , , . Bookmark the permalink.

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