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West Virginia governor’s company fails to pay property taxes in Albemarle, faces questions over land use
Presidential Estates, August 2, 2017
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Credit: Tim Dodson, Charlottesville Tomorrow
A view of one portion of Presidential Estates from Ed Jones Road. Timber harvesting operations are underway on parts of the 4,500 acre property.
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Tim Dodson | Monday, August 07, 2017 at 9:47 p.m.

A company owned by West Virginia Gov. Jim Justice’s family is facing questions after it failed to pay taxes on 55 land parcels it owns in Albemarle County. Records show a total of $19,305 is past due, including penalties and interest, for missed real estate tax payments in June and December 2016 and June 2017.

The revelation comes amid claims by a neighboring landowner that recent activity following a timber harvesting has generated significant runoff damaging her property and the scheduling of a community meeting by local officials to respond to questions about the logging and tax compliance.

James C. Justice II made national headlines last week when he decided to leave the Democratic Party to join the GOP. President Donald Trump celebrated the change with Justice at a rally in Huntington.

James C. Justice Cos. bought the 4,500 acres south of James Monroe’s Highland and Thomas Jefferson’s Monticello for $23.75 million in 2010 from Richmond-based MeadWestvaco Corp. The land has a rural zoning designation.

Mimi Hirsch has owned her farm in southeastern Albemarle since 1989. During this time, logging and forestry operations have taken place on nearby property, including two harvests by MeadWestvaco.

She said logging occurred on the adjacent property within the last few years, and earlier this year, the leftover stumps on the property were ground up.

Hirsch claims rainfall in early May resulted in the mulchy material left over from the grinding and logging operations washing onto her property. She documented the erosion and residue in several photographs.

“The water came down off this hillside,” she said on a recent tour of her farm. “I really was not able to use my driveway.”

She said she spent money clearing her driveway of the debris and installing a silt fence to prevent future runoff. Residue of the material still appears to be present on her property.

“I knew that this was not the way it was supposed to be because when [Mead]Westvaco harvested before, there was none of this,” she said.

In early July, she reported the incident to the Thomas Jefferson Soil and Water Conservation District. Since then, numerous officials, state agencies and the county have become aware of her situation.

Although Hirsch is appreciative of the response, she said there has been a lack of clarity about who is responsible for monitoring land uses on the nearby property and ensuring the impacts on neighbors and the environment are limited.

Forestry operations are exempt from the county’s erosion and sediment control requirements and are monitored by the Virginia Department of Forestry. However, the department concluded that the removal of stumps next to Hirsch’s farm does not qualify as a forestry operation it would have the authority to regulate.

Meanwhile, there are active timber harvestings on other parts of the 4,500 acres being monitored by state forestry officials.

David Powell, a senior area forester for the department, said a logging operation is typically inspected until its completion. “Once a harvesting operation is closed, we don’t necessarily have the jurisdiction or the reason to be back out on a particular piece of property,” he said.

“We went through our procedures and went out there [to the parcel near Hirsch’s farm] and determined that the issue ... was not related to forestry activities,” he said. “Our position based on the facts at hand is that piece of land has moved out of the jurisdiction of the department of forestry and there is some other land use occurring there.”

County officials are trying to figure out what exactly that other land use is.

James C. Justice Cos. did not respond to multiple requests for comment over the past week.

The land also could be in the process of being converted to an agricultural use, which would also be exempt from local erosion and sediment control requirements.

“Under state erosion and sediment control law, there is an exemption for agricultural activities, as well, so it could potentially be exempt from county regulation — that’s yet to be determined,” said Mark Graham, the county’s director of community development. “Until we can get some feedback from the property owner on what their intent is with the property, it is a bit of a gray area.”

Lonnie Murray is an elected official who represents Albemarle County on the Thomas Jefferson Soil and Water Conservation District.

“Certainly, there are some problems and gaps in the guidance provided to localities in terms of how regulation should occur as properties transition through these different land uses. Particularly, the change from forestry [use] to pasture to residential is not very clear,” said Murray.

Murray, who said he was not speaking on behalf of the district and only sharing his own perspective, suggested the county look at what tools are available to better manage these transitions and noted that the Justice properties are part of a larger discussion about land use transitions.

“It’s big, it’s visible, it has some big names attached to it, but, ultimately, we need to look at how rural land use changes can impact things like water quality and the rural area,” Murray said.

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All 55 parcels owned by the company were previously a part of the county’s land use taxation program, which offers a lower tax rate to property owners who use their land for forestry, agriculture, horticulture or open space.

There can be a stark difference in the taxes paid for properties in the land use program and those that are taxed at fair market value. One parcel owned by the company, for example, had a market value of $163,400 in 2016. The taxable value under the land use program was only $6,800. That’s a difference of paying about $1,371 versus $57 in annual taxes.

Of the 55 parcels that were under the forestry designation of the land use program, 52 recently were removed from the program due to unpaid taxes from 2016.

“The [county] code says that if a taxpayer or property [owner] is delinquent on his taxes by June 1 of 2017, for their 2016 taxes, then they must be removed from the land use program,” County Assessor Peter Lynch said.

The company also failed to pay its first installment of 2017 property taxes, which were due by June 15. According to county records, the company owes the county a total of about $19,305.

Moving forward, the 52 parcels that have been removed from the program will be taxed at market value, although the company could apply to put them back into the land use program.

“First, they have to come current on their taxes on any property they want to put back in the program,” Lynch said. “Once they do that, they have to put in a new application for either forestry or agriculture, whatever they want to do at that point.”

The company ultimately would have to pay five years worth of rollback taxes on any properties that do not return into the program.

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Justice told Charlottesville Tomorrow in a 2011 interview that he did not have “a grand master plan” for the property, which was marketed at the time of his acquisition as “Presidential Estates” due to its proximity to some of Albemarle’s most famous historic sites.

“It surely has the development possibilities, from a lot of different angles, including home sites or whatever, but it also has such an incredible historical value,” Justice said at the time.

The West Virginia billionaire has made his fortune in the coal, timber, agriculture and recreation industries. He also owns The Greenbrier resort and owned Wintergreen Resort from 2012 to 2015.

Presidential Estates appears to have been back on the market earlier this year for an asking price of $42.1 million. In an email, Thomas & Talbot Real Estate’s John Coles said the property is no longer for sale, but did not return an inquiry about whether the property was successfully sold. County records do not indicate any recent transactions.

Graham said a community meeting tentatively scheduled for Aug. 22 will consider questions such as the impacts of land uses at Presidential Estates on adjoining properties, ways the county and state can address those impacts and the status of the property taxes. The meeting is scheduled to take place from 4:30 to 6 p.m. in Room 241 of the County Office Building-McIntire.

 

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