                                 CODE OF VIRGINIA

CHANGE IN USE OR ZONING OF REAL ESTATE ASSESSED UNDER ORDINANCE; ROLL-BACK TAXES
(§ 58.1-3237)

A. When real estate qualifies for assessment and taxation on the basis of use
under an ordinance adopted pursuant to this article, and the use by which it
qualified changes to a nonqualifying use, or, except as provided by ordinance
enacted pursuant to subsection G, the zoning of the real estate is changed to a
more intensive use at the request of the owner or his agent, it shall be subject
to additional taxes, hereinafter referred to as roll-back taxes. Such additional
taxes shall only be assessed against that portion of such real estate which no
longer qualifies for assessment and taxation on the basis of use or zoning.
Liability for roll-back taxes shall attach and be paid to the treasurer only if
the amount of tax due exceeds ten dollars.

B. In localities which have not adopted a sliding scale ordinance, the roll-back
tax shall be equal to the sum of the deferred tax for each of the five most
recent complete tax years including simple interest on such roll-back taxes at a
rate set by the governing body, no greater than the rate applicable to
delinquent taxes in such locality pursuant to &#xA7; 58.1-3916 for each of the
tax years. The deferred tax for each year shall be equal to the difference
between the tax levied and the tax that would have been levied based on the fair
market value assessment of the real estate for that year. In addition the taxes
for the current year shall be extended on the basis of fair market value which
may be accomplished by means of a supplemental assessment based upon the
difference between the use value and the fair market value.

C. In localities which have adopted a sliding scale ordinance, the roll-back tax
shall be equal to the sum of the deferred tax from the effective date of the
written agreement including simple interest on such roll-back taxes at a rate
set by the governing body, which shall not be greater than the rate applicable
to delinquent taxes in such locality pursuant to &#xA7; 58.1-3916, for each of
the tax years. The deferred tax for each year shall be equal to the difference
between the tax levied and the tax that would have been levied based on the fair
market value assessment of the real estate for that year and based on the
highest tax rate applicable to the real estate for that year, had it not been
subject to special assessment. In addition the taxes for the current year shall
be extended on the basis of fair market value which may be accomplished by means
of a supplemental assessment based upon the difference between the use value and
the fair market value and based on the highest tax rate applicable to the real
estate for that year.

D. Liability to the roll-back taxes shall attach when a change in use occurs,
or, except as provided by ordinance enacted pursuant to subsection G, a change
in zoning of the real estate to a more intensive use at the request of the owner
or his agent occurs. Liability to the roll-back taxes shall not attach when a
change in ownership of the title takes place if the new owner does not rezone
the real estate to a more intensive use, unless otherwise provided by ordinance
enacted pursuant to subsection G, and continues the real estate in the use for
which it is classified under the conditions prescribed in this article and in
the ordinance. The owner of any real estate which has been zoned to more
intensive use at the request of the owner or his agent as provided in subsection
E, or otherwise subject to or liable for roll-back taxes, shall, within sixty
days following such change in use or zoning, report such change to the
commissioner of the revenue or other assessing officer on such forms as may be
prescribed. The commissioner shall forthwith determine and assess the roll-back
tax, which shall be assessed against and paid by the owner of the property at
the time the change in use which no longer qualifies occurs, or at the time of
the zoning of the real estate to a more intensive use at the request of the
owner or his agent occurs, and shall be paid to the treasurer within thirty days
of the assessment. If the amount due is not paid by the due date, the treasurer
shall impose a penalty and interest on the amount of the roll-back tax,
including interest for prior years. Such penalty and interest shall be imposed
in accordance with &#xA7;&#xA7; 58.1-3915 and 58.1-3916.

E. Real property zoned to a more intensive use, at the request of the owner or
his agent, shall be subject to and liable for the roll-back tax at the time such
zoning is changed. The roll-back tax shall be levied and collected from the
owner of the real estate in accordance with subsection D. Real property zoned to
a more intensive use before July 1, 1988, at the request of the owner or his
agent, shall be subject to and liable for the roll-back tax at the time the
qualifying use is changed to a nonqualifying use. Real property zoned to a more
intensive use at the request of the owner or his agent after July 1, 1988, shall
be subject to and liable for the roll-back tax at the time of such zoning. Said
roll-back tax, plus interest calculated in accordance with subsection B, shall
be levied and collected at the time such property was rezoned. For property
rezoned after July 1, 1988, but before July 1, 1992, no penalties or interest,
except as provided in subsection B, shall be assessed, provided the said
roll-back tax is paid on or before October 1, 1992. No real property rezoned to
a more intensive use at the request of the owner or his agent shall be eligible
for taxation and assessment under this article, provided that these provisions
shall not be applicable to any rezoning which is required for the establishment,
continuation, or expansion of a qualifying use. If the property is subsequently
rezoned to agricultural, horticultural, or open space, it shall be eligible for
consideration for assessment and taxation under this article only after three
years have passed since the rezoning was effective.
			However, the owner of any real property that qualified for assessment and
taxation on the basis of use, and whose real property was rezoned to a more
intensive use at the owner&#8217;s request prior to 1980, may be eligible for
taxation and assessment under this article provided the owner applies for
rezoning to agricultural, horticultural, open-space or forest use. The real
property shall be eligible for assessment and taxation on the basis of the
qualifying use for the tax year following the effective date of the rezoning. If
any such real property is subsequently rezoned to a more intensive use at the
owner&#8217;s request, within five years from the date the property was
initially rezoned to a qualifying use under this section, the owner shall be
liable for roll-back taxes when the property is rezoned to a more intensive use.
Additionally, the owner shall be subject to a penalty equal to fifty percent of
the roll-back taxes due as determined under subsection B of this section.
			The roll-back taxes and penalty that otherwise would be imposed under this
subsection shall not become due at the time the zoning is changed if the
locality has enacted an ordinance pursuant to subsection G.

F. If real estate annexed by a city and granted use value assessment and
taxation becomes subject to roll-back taxes, and such real estate likewise has
been granted use value assessment and taxation by the county prior to
annexation, the city shall collect roll-back taxes and interest for the maximum
period allowed under this section and shall return to the county a share of such
taxes and interest proportionate to the amount of such period, if any, for which
the real estate was situated in the county.

G. A locality may enact an ordinance providing that (i) when a change in zoning
of real estate to a more intensive use at the request of the owner or his agent
occurs, roll-back taxes shall not become due solely because the change in zoning
is for specific more intensive uses set forth in the ordinance, (ii) such real
estate may remain eligible for use value assessment and taxation, in accordance
with the provisions of this article, as long as the use by which it qualified
does not change to a nonqualifying use, and (iii) no roll-back tax shall become
due with respect to the real estate until such time as the use by which it
qualified changes to a nonqualifying use.

HISTORY: Code 1950, § 58-769.10; 1971, Ex. Sess., c. 172; 1973, c. 209; 1974,
c. 34; 1977, c. 323; 1979, c. 179; 1980, c. 363; 1984, cc. 92, 222, 675, 676,
681; 1985, c. 478; 1988, cc. 422, 695; 1990, c. 841; 1992, Sp. Sess., c. 3;
1998, c. 274; 1999, c. 1026; 2013, c. 269.