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A hokey political commercial from the conservative super PAC American Crossroads lambasts Democratic Sen. Bill Nelson as a politician who has gotten out of paying property taxes.
"After 40 years in politics, Bill Nelson has learned how to milk the system. He leased land that he owned for six cows, taking advantage of an agricultural tax loophole to dodge $43,000 in taxes just last year," the narrator says. "Then he sold the land for home development, pocketing at least $1.4 million."
The kicker: "Tax breaks and big profits for him, higher taxes for the rest of us."
We rated the group’s claim that Nelson is using Florida’s greenbelt assessment to "dodge" taxes Half True. Here, we will look at whether he sold the land for home development for at least $1.4 million.
The greenbelt exemption
As evidence for the ad, Crossroads spokesman Nate Hodson referred us to a February 2012 Tampa Bay Times story that scrutinized Nelson’s qualifications for a "greenbelt" assessment, which spares him from paying higher taxes on his family’s 55-acre pasture along the Indian River. Instead of paying taxes on the market value, his tax bill is based on a much lower agricultural assessment.
Nelson gets the greenbelt assessment for his Brevard County pasture because he leases the land to a small-time cattle owner. The current lessee, cattleman Jeff Darby, has a herd of about six cows and uses the land free of charge, though he is tasked with maintenance.
The greenbelt law was enacted in 1959 as a financial incentive for farmers to keep their land as developers bought up farm land for malls, highways and homes.
Without the lower agricultural rate, Nelson would have paid about $43,000 in higher taxes on the land.
The ad gives voters the impression that Nelson parked some cows on land to save money on his taxes and then axed the cows in a land sale to developers. (The ad sends the cows flying with the arrival of a new brick house from the sky.)
Such a move obviously goes against the spirit of the greenbelt law, though it’s legal, and it happens. The problem with the greenbelt law, critics say, is that it’s written too broadly. Under the law, county property appraisers are tasked with determining if the land is used "primarily for bona fide agricultural purposes."
The Brevard County property appraiser’s office has tried to remove Nelson’s greenbelt designation in the past, but Nelson fought to keep it and won in court. (An inspector in 1999 went to his property and found no cows; Nelson argued they escaped via a hole in the fence.)
Nelson’s land sales
The ad leaves out a lot of important context about that $1.4 million profit that Nelson supposedly gained from land sales.
When Nelson moved to Tallahassee in the mid ’90s to serve on the state Cabinet, he sold the main house that he lived in, which is adjacent to the pasture.
He sold four more nearby lots after he moved to Washington, D.C., to serve as a U.S. senator. Two of these were residential lots that had houses on them. Two more were lots that he cut out of his pastureland, so those had used the greenbelt exemption. The total for these four transactions to private homeowners is at least $1.4 million, the Times reported. Florida’s greenbelt law does not require him to pay back part of his tax break.
Nelson’s campaign does not dispute the $1.4 million total -- they do dispute how American Crossroads presented the transactions. That total does not represent all of the money he received from the agricultural lots; it also includes the sales of two residential lots.
The ad is leading viewers to equate the land that got the tax break with the land he sold for $1.4 million, and that’s plainly wrong. Nelson did not sell the entire pasture. The cows still graze on it, and Nelson has indicated that will not change for the land his family has had since 1924.
"I've looked at all the options on the rest of the property and I've decided not to develop it. I want to leave it to my kids," Nelson told the Times in February.
It’s not fully accurate for Crossroads to say Nelson took land that was receiving agricultural tax breaks and sold it for "home development" at a profit of $1.4 million. For one, the land that earned the tax break -- a 55-acre pasture -- is still a pasture. He did not sell that land "for home development."
Nelson has sold two agricultural lots, but those sales do not total $1.4 million. To get there, you have to factor in two more sales of residential lots adjoining the pasture. Those lots already had homes on them when Nelson sold them.
American Crossroads is cherry-picking a figure from the Times story to incite anger against Nelson’s tax break without telling the entire story. We rate this claim Mostly False.
Tampa Bay Times’ The Buzz blog, "Super PAC hits Bill Nelson over ag property," Oct. 2, 2012
Tampa Bay Times, "Sen. Bill Nelson benefits from Florida’s generous ‘greenbelt’ law," Feb. 15, 2012
Interview with Sen. Bill Nelson, Oct. 2, 2012
Connie Mack’s YouTube account, "Udder hypocrisy," Feb. 17, 2012
The Atlantic, "America’s Dumbest Tax Loophole: The Florida Rent-A-Cow Scam," April 17, 2012
Interview with Dan McLaughlin, Nelson spokesman, Oct. 9-10, 2012
Brevard County Property Appraiser’s Office website, parcel information for Bill Nelson, accessed Oct. 9, 2012
Brevard County Tax Collector’s Office website, 2011 property tax record for Bill Nelson, accessed Oct. 9, 2012
The Miami Herald, "How developers cash in on farmland," Aug. 21, 2005
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