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View Diary: Tackling World Food Crisis: Agricultural Reform (261 comments)

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  •  It's not the property tax (4+ / 0-)

    One of the good things about Proposition 13 is that property tax only rises 2% a year from the sale price - so most farmers are OK there. There is Williamson act designation for more recent purchases to reduce property taxes on newer purchases.

    The problem is that they are land rich and cash poor. They may be making $30k-$40k a year on a million dollar (or more) piece of land, and by doing hard physical labor.

    So, when they reach retirement age, the only way to unlock their assets is to sell out - and unless they have children who wish to keep farming, they almost have to if they want to retire. And, why shouldn't they sell for the full market value of the property, even if it means the land will come out of production?

    But at full market value, the farm may no longer be viable. If the farm is yielding $40k with no mortgage, but sells for $2M, the new mortgage is going to be in the neighborhood of $120k a year. Ooops.

    Fry, don't be a hero! It's not covered by our health plan!

    by elfling on Sat Apr 19, 2008 at 02:10:52 PM PDT

    [ Parent ]

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