Tax-evading landowners in Metro Vancouver are offering free pasture to cows and renting llamas in a bid to achieve farm status and reduce their property taxes, a new report says.
Abuse is rife among some owners of unused agricultural land, who are leasing out their backyards to take advantage of the low threshold for qualifying for farm status, says a report by Colliers International.
Those granted farm status pay significantly lower taxes than those whose land is zoned residential or industrial.
"We're seeing people take advantage of this low threshold to achieve the lower tax rate," said Scott Bowden of Colliers, who made a presentation to Metro Vancouver's regional planning and agriculture committee Friday. "We have seen evidence of this being abused."
The report comes as part of a Metro Vancouver review on ways to boost agricultural use on regional farm lands, both inside and outside the Agricultural Land Reserve.
A land inventory report by the Agriculture Ministry suggests about 56 per cent, or 34,147 hectares, of Metro Vancouver land in the ALR is now used for farming, along with 1,570 ha outside the reserve.
Another 25 per cent of land - most of it in the Township of Langley, Surrey, Maple Ridge and Delta - is not being farmed but is available and has potential, according to a Metro staff report. Two-thirds of all farmland also includes residential uses, while many smaller parcels, including those three to five ha in size, often aren't farmed at all.
"This tells us that further subdivision of parcels in the ALR is not desirable, and may only encourage more non-farm use of ALR land," the report states. "Although small parcels (less than four ha) only occupy 22 per cent of the total area of ALR land, additional rural residential housing in farming areas exacerbates urban agriculture conflicts when there is a lack of edge planning."
Richmond Coun. Harold Steves, a farmer, said many landowners are buying up agricultural land to build giant homes, and then leasing out their backyards to dairy farmers or blueberry growers to get the tax break. Others plant apple orchards and then don't pick the fruit.
His own cows were even coveted at one time, Steves said, with a landowner offering him free pasture. He didn't take it. "That's a bit of a problem because it encourages all these big houses on farmland," he said. "We have a lot of blueberry farms in Richmond and I know those people who live in those houses aren't farmers.
"The rules should be changed.
Bonafide farmers should be the ones who farm."
Bowden has suggested several measures to encourage farming, including approving a higher threshold for taxes on agricultural land and consolidating some of the smaller parcels to ensure farm uses in the ALR and preserve agricultural land. He also acknowledged that some farms aren't always profitable and suggested Metro municipalities could also consider a rolling average tax to help stabilize income for farmers.
Jack Froese, mayor of Langley Township, said a rolling average tax on farmland would be more equitable, noting that farmers should get credit for improving the land before they start farming on it. He noted his township reaps about $277 million in farm sales, and while some landowners may take advantage of the agriculture tax with no intention of farming, there are others who are legitimately raising hogs and chickens on small parcels of land. These farmers should be allowed to lease out their land, he argued, noting it can be tough to make a profit, especially if residents aren't willing to buy local.
"You can put all the land you want into food production but if they're going broke, there's no point," he said. "They farm for the love of farming but they also farm to make a profit. The whole idea is to get land in agricultural production whether you're leasing it or doing it yourself."
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