Going 'Clean and Green'

My wife found a wonderful law in Pennsylvania (Green and Clean Act) which allows anyone with 10 contiguous acres to receive a tax break if the land owner promises not to develop the land. The idea is to have individual land owners volunteer their land for preservation and be rewarded by receiving a tax break with the ultimate goal of slowing urban sprawl.

There are various designations you can apply for, but we have chosen to apply for the Agricultural Reserve.

Definition of Agricultural reserve:
Land that is in agricultural reserve is eligible for preferential assessment under the act if the land is comprised of 10 or more contiguous acres (including any farmstead land and any woodlot).

We just recently completed and sent in our application to the County. It appears our next step is a new county assessment after which we will find out our new (hopefully lower) tax rate which will take affect in 2008.

As long as you do not develop the land, it appears this is a wonderful deal. Since seeing into the future can be very hard the government does allow you to break the contract...but with a penalty. Essentially, if in 5 years you decide to split the land into various smaller segments, you will loose the tax incentive (because you are now developing the land) and have to pay any tax savings for the past 6 years along with a 6% simple interest fee. So unless you plan on keeping the land as is for more then 10 years, you really do not make out on this deal because of the interest penalty.

If you have gone Clean and Green or had considered it, your feedback would be very welcome. I want to make sure I have not missed some sort of 'gotcha' before officially going Clean and Green.

More updates once we know more!