From The Pueblo Chieftain (Patrick Malone):
State Rep. Wes McKinley, D-Walsh, told the House Finance Committee that HB1208 aims to hold the state to its promise. “We made a deal with these people,” McKinley said. “We’re just going to have to go ahead and honor the deal.”[…]
McKinley said when the state began offering tax credits to leave land untouched, many in the land-rich but cash-poor agriculture community seized the opportunity. Because tax liabilities in the agriculture world are few, land donors parted with their tax credits for about 75 percent of their value to purchasers facing steep tax liabilities. When buyers redeemed those tax credits, the Department of Revenue rejected many because appraisers had overvalued the land by 500 to 1,000 times its true worth, in some cases. Buyers of the credits in turn sought to be made whole by the donors they had purchased the tax credits from, but often the proceeds of the easement sale had long been devoured by the expenses associated with agriculture — feed, seed and sustenance during droughts and blizzards that decimated crops and herds…
In short, HB1208 “simply says the credit will be allowed,” and the director will not contest or dig deeper into the appraised value of the conservation easement or its validity unless an appraiser associated with the credit has been found to commit fraud. The Department of Revenue has decried McKinley’s amnesty bill because landowners who recognize a prospect that could spare them the expense of squaring up with the state have been reluctant to participate in scheduled mediation sessions in hopes that the Legislature will whisk their problem away.
John Swartout, executive director of the Colorado Coalition of Land Trusts, testified against the bill “because it treats everybody the same.”
More coverage from Debi Brazzale writing for the La Junta Tribune Democrat. From the article:
McKinley says the department has been demanding interest, fees and penalties on easements that they now say were overvalued. Some landowners receiving the notices have been waiting years, in some cases, for the department, who say they are overwhelmed and lack resources to resolve the disputes.
Rep. Cindy Acree, R-Aurora, expressed dismay at the predicament the landowners find themselves in. “This seems absurd that these cases are dragging on and on while interest is accruing,” said Acree.
Department of Revenue spokesman Mark Couch said the department is doing what it is obligated to do on behalf of taxpayers. Couch said that $466 million has been granted to filers since 2001 when the conservation-easement program began and that 16,000 tax returns have been honored.
“We don’t believe we’re the bad guys,” said Couch. “Our job is to protect the taxpayers, and we have the responsibility to make sure that the credits that are claimed are due to the filer.”
More 2011 Colorado legislation coverage here.