Summary of a Recent
Judicial Development in
Estate Planning and Taxation

Farmland Assessment Denied for Woodlot

Ross H. Pifer
National AgLaw Center Graduate Assistant

In Alexandria Township v. Orban, 21 N.J. Tax 298 (N.J. Tax Ct. 2004), the landowners sought to have their property, which was utilized as a woodlot, assessed as farmland. In order to qualify for farmland assessment, the landowners began to prepare a woodland management plan in May 2000. See id. at 300. This plan, however, was not filed with the Department of Environmental Protection and the tax assessor for Alexandria Township (Township) until May 2001. See id. The tax assessor denied the landowners' application for farmland assessment for 2003, taking the position that the property had not been devoted to agriculture or horticulture for the requisite two-year period. See id. at 301. The Tax Court of New Jersey ruled in favor of the Township, holding that "a woodland management plan must be filed by January 1 two years prior to the year for which farmland assessment as a woodlot is sought." Id. at 311. The court based its decision on the statutory requirement that "land must be actively devoted to agricultural or horticultural use for 'at least the two successive years immediately preceding the tax year for which the valuation . . . is requested'" to be assessed as farmland. Id. at 304 (citing N.J. Stat. Ann. § 54:4-23.6). Since "[l]and on which trees and forest products are produced for sale is 'actively devoted to agricultural or horticultural use' [only] when it is in compliance with a written approved woodland management plan," the court determined that the landowners' woodlot was not devoted to horticultural use until May 2001. Id. at 310. The court, therefore, concluded that because the woodlot "was not actively devoted to horticultural use for all of 2001, it [could] not qualify for farmland assessment in 2003." Id.

The case was decided on May 4, 2004; this summary was posted June 10, 2005.