Did you catch the numbing remark in the state newspaper this week about the land value of the rugged slopes south of Lake Maumelle that the water utility for central Arkansas is trying to buy to keep your water safe? If the attorney for Deltic Timber Corp. proves right in his declaration that the land is worth “at least” $20,000 an acre on the open market, grab your pocketbook. Your water rates are going to go up and up.
Deltic, the El Dorado-based timber and development giant that developed much of the luxurious Chenal Valley subdivisions west of Little Rock, wants to build expensive estates on the slopes and valleys of 760 acres overlooking the intake for central Arkansas’ water supply. After Deltic was thwarted in the legislature last year in its effort to preserve its ability to build on the land, Central Arkansas condemned the property to prevent the developer from degrading the water. A trial in Pulaski Circuit Court in September will determine how much the utility — that is all of us — will have to pay for the land.
Deltic, we are sure, will have appraisers who will testify that the market value of the land is $20,000 an acre or maybe much more. If the court accepts the $20,000-an-acre valuation, the water company would shell out $15.2 million for the acreage. That would be only the beginning as builders lay out plans for developing other valleys in the watershed.
Is $20,000 an acre a fair price for taxpayers and water users to pay? Here is a good measure, in our way of thinking: What did Deltic say the land was worth when it went down to the courthouse in the most recent tax year to declare the land’s value for tax purposes? On those 760 acres, Deltic paid a grand total of $228 to the county and the schools, according to the office of the county tax assessor. The value of the land, in that reckoning, was in the neighborhood of $250 an acre rather than $20,000.
The law seems to favor Deltic, unless it is challenged. The big paper companies and agribusinesses got the state Constitution amended in 1980 to let them value their land for tax purposes upon something called the “use” or “productive” formula rather than its true market value while homeowners and businesses paid taxes on the market value of their property. Frank Lambright, a retired Little Rock insurance man, has been trying to get the waterworks to challenge the constitutionality of the 1980 law on the premise that it violates the equal protection clause of the U.S. Constitution by favoring one class of property owners over others.
To be fair in any circumstance, one of two things needs to happen: Either prime development land needs to be taxed for school and county needs on the basis of its actual market value, or else when the land is condemned for public protection the company needs to be made to sell the land for the value that the owner itself places on the land when he assesses it.
The public — taxpayers, school children, and water users — should not be slammed twice, once on tax bills and again on inflated prices. Once is plenty.
