If a Virginia landowner's open-space use agreement under the land-preservation tax program expires (and they don't renew it), can the locality assess roll-back taxes against them as if there were a change in use?

Subject

The expiration of an open space use agreement is not a change in use and does not subject the property to roll-back taxes.

Plain-English summary

Virginia counties and cities can choose, by ordinance, to assess certain land at "use value" rather than fair market value, to encourage preservation of agricultural, forest, horticultural, and open-space uses. To get into the program for open-space use, a landowner signs an open-space use agreement (4 to 10 years) committing not to change to a nonqualifying use. If the use later changes to something nonqualifying, the locality can claw back the tax savings via "roll-back taxes" under § 58.1-3237.

Senator Deeds asked: if a landowner's open-space use agreement just expires (they don't renew it), but the actual use of the land does not change, can the locality assess roll-back taxes anyway?

The AG said no. The statute pegs roll-back liability to a change in actual use (or to a request-of-owner rezoning to a more intensive use), not to the expiration of a piece of paper. The agreement is what gets the property into the program; the actual qualifying use is what avoids roll-back. If a landowner lets the agreement expire but keeps the land in open-space use, the property simply leaves the use-value program for future tax years (no special benefit going forward), but no retroactive recapture is triggered. The AG also noted that imposing roll-back liability on mere expiration would frustrate the program's purpose by deterring landowners from entering open-space agreements in the first place.

What this means for you

For Virginia landowners with open-space use agreements

If your open-space use agreement is about to expire and you do not plan to renew it, you do not automatically owe roll-back taxes. Under the opinion, as long as the land stays in a qualifying open-space use, the locality cannot retroactively recapture your tax savings. Roll-back liability attaches when the actual use changes to a nonqualifying use, or when the zoning is changed to a more intensive use at the owner's request.

For local commissioners of revenue and tax assessors

Do not issue roll-back tax assessments solely because an open-space use agreement has expired. The AG opinion is clear: roll-back liability under § 58.1-3237 attaches only when (a) the use changes to a nonqualifying use, or (b) the zoning is changed to a more intensive use at the owner's request. Continued open-space use without an active agreement removes the property from the program prospectively but does not justify retroactive recapture. Whether a particular property's use has changed is a factual determination you make in the ordinary course.

For real estate attorneys advising clients

Treat program participation (use agreement) and land use status as legally distinct. A client can be removed from the use-value tax program (for non-renewal, late taxes, or other compliance failure) without becoming liable for roll-back taxes, provided the underlying use stays qualifying. Roll-back liability under § 58.1-3237 follows actual use, not paper status.

For land conservation advocates

This opinion strengthens the policy of the land-use preservation program. Landowners are not punished retroactively for stepping out of the program if they continue the qualifying use. That makes the program less risky to enter and may encourage more landowners to sign initial open-space use agreements knowing that non-renewal will not produce a tax penalty for years already deferred.

Common questions

What is "use-value assessment"?

A Virginia real-property tax program that assesses land based on its present use rather than its fair-market (typically development) value. For qualifying open-space, agricultural, forest, or horticultural use, this can produce a much lower assessment, with corresponding tax savings.

What are "roll-back taxes"?

The difference between the tax that would have been paid at fair market value and the tax that was paid under the use-value assessment, for a specified prior period. They are a recapture mechanism, triggered when a property leaves qualifying use.

When are roll-back taxes triggered?

Under § 58.1-3237(A), when (1) the use changes to a nonqualifying use, or (2) the zoning is changed to a more intensive use at the request of the owner. Subsection D reinforces: "Liability to the roll-back taxes shall attach when a change of use occurs."

Does the agreement expiring count as a "change of use"?

No. The AG was direct: agreement expiration "does not affect the underlying use of the land," and roll-back taxes "are imposed only when the actual use of the land changes to a nonqualifying use."

What does qualify as "open-space use"?

Under § 58.1-3230, open-space use includes park or recreational use, conservation of land or natural resources, floodways/wetlands/riparian buffers, historic or scenic purposes, and shaping community development.

How long are open-space use agreements?

4 to 10 years, per § 58.1-3233. The agreement is recorded with the land records and runs with the land for its term.

What happens after the agreement expires?

The property exits the use-value tax program going forward. It will be assessed at fair market value for future tax years. But no retroactive recapture occurs unless and until the actual use changes.

Background and statutory framework

Virginia's land-use taxation framework rests on Va. Const. art. X, § 2, which authorizes the General Assembly to allow tax deferrals or relief for agricultural, horticultural, forest, and open-space uses. The General Assembly's implementing statutes sit at §§ 58.1-3230 to 58.1-3244 ("Special Assessment for Land Preservation"). To participate, a locality must adopt an ordinance, the landowner must sign a use agreement, and the landowner must annually apply for the use-value assessment.

The roll-back framework at § 58.1-3237 pegs recapture to an actual change in use, or to owner-requested rezoning to a more intensive use. The opinion draws on prior AG opinions and case law for the principle that land use is distinct from participation in a land-use tax program, so removal from the program does not, by itself, subject the land to roll-back taxes.

The AG's reasoning rests on the canonical Virginia tax-statute principle: "[t]axes can only be assessed, levied and collected in the manner prescribed by express statutory authority" (SunTrust Bank, quoting Woodward v. City of Staunton).

Citations

• Va. Const. art. X, § 2 (tax-relief authority)
• Va. Code Ann. § 2.2-505 (authority for advisory opinions)
• Va. Code Ann. § 58.1-3230 (qualifying open-space uses)
• Va. Code Ann. § 58.1-3231 (locality authority to adopt ordinance)
• Va. Code Ann. § 58.1-3233 (use agreements)
• Va. Code Ann. § 58.1-3234 (application and revalidation)
• Va. Code Ann. § 58.1-3237 (roll-back tax trigger)
• Va. Code Ann. § 58.1-3238 (reporting use changes)
• Va. Code Ann. §§ 58.1-3230 to 58.1-3244 (Special Assessment for Land Preservation)
• Ticonderoga Farms, Inc. v. Loudoun Cnty., 54 Va. Cir. 542 (2001)
• City of Virginia Beach v. ESG Enterprises, Inc., 243 Va. 149 (1992)
• City of Richmond v. SunTrust Bank, 283 Va. 439 (2012)
• Woodward v. City of Staunton, 161 Va. 671 (1933)
• Chesterfield Cnty. v. Stigall, 262 Va. 697 (2001)
• 1972-73, 1976-77, 1980-81, 1982-83, 1985-86, 1996, 1997, 2002, 2006 Op. Va. Att'y Gen.

Source

• Landing page: https://www.oag.state.va.us/annual-reports-opinions/official-opinions
• Original PDF: https://www.oag.state.va.us/files/Opinions/2025/24-026-Deeds-issued.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain. The linked PDF is authoritative.

COMMONWEALTH of VIRGINIA
Office of the Attorney General
Jason S. Miyares
Attorney General
December 18, 2025

The Honorable R. Creigh Deeds
Senate of Virginia
Post Office Box 5462
Charlottesville, Virginia 22905-5462

Dear Senator Deeds:

I am responding to your request for an official advisory opinion in accordance with § 2.2-505 of the Code of Virginia.

Issue Presented

You ask whether the expiration of an open space use agreement constitutes a change in use of the subject property to a non-qualifying use, thereby triggering the assessment of roll-back taxes.

Response

It is my opinion that the expiration of an open space use agreement is not a change in use and does not subject the property to roll back taxes.

Applicable Law and Discussion

Real estate in Virginia "is to be assessed at fair market value except that taxpayers may, by state statute and local ordinance, receive a deferral or relief from taxes on land devoted to agricultural, horticultural, forest or open space uses." The purpose behind allowing special tax treatment is "to create a financial incentive to encourage the preservation and proper use of land devoted to [such] uses." Although no "deferral or relief shall be granted . . . except by ordinance adopted by the governing body" of the local taxing authority, any local ordinance establishing a land preservation tax program must comport with any terms prescribed by the General Assembly.

The authority of local governments to employ special tax assessments for land preservation purposes is set out in Article 4, Chapter 32 of Title 58.1. It expressly provides that a locality with a land use plan "may adopt an ordinance to provide for the use value assessment and taxation" of property classified as real estate devoted to open-space use. The General Assembly has specified that land qualifies as real estate devoted to open-space when it is used for park or recreational purposes; conservation of land or other natural resources; floodways, wetlands, and riparian buffers; historic or scenic purposes; or shaping of the character, direction, and timing of community development or for the public interest.

Special assessment and taxation of land based on qualifying open-space use is not automatic. A landowner may seek to avail himself of assessment under a local land preservation program if he has entered into an agreement with the local governing body committing "not to change the use to a nonqualifying use for a time period stated in the commitment . . . ." The open space use agreement, which is to be recorded with the land records, must set forth a use-commitment period between four and ten years; the commitment "shall run with the land for the applicable period[.]" Once the commitment is finalized the landowner "shall submit an application for taxation on the basis of a use assessment to the local assessing officer" prior to the tax year for which the assessment is sought.

Acceptance of a use-assessment application does not result in perpetual assessment under a land preservation tax program. Applications may be subject to revalidation by the locality "at least every six years," and continued participation in a program "depend[s] on continuance of the real estate in a qualifying use, continued payment of [applicable] taxes, and compliance with the other [applicable state or local] requirements." Not only is property subject to program removal for future tax years, but a locality also can effect "retroactive removal" through the assessment of roll-back taxes, which are assessments that "recapture[] some or all of the increment of tax reduction afforded to a property for a specified period of years prior to the end of the preferential tax treatment."

Code § 58.1-3237 governs the assessment of roll-back taxes. Pertinent here, Subsection A establishes that when property "qualifies for assessment and taxation on the basis of use . . . , and the use by which it qualified changes to a nonqualifying use, or . . . the zoning of the real estate is changed to a more intensive use at the request of the owner . . . , it shall be subject to additional taxes[.]" These taxes are referred to as "roll-back taxes." The provision clarifies that "[s]uch 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." Subsection D clarifies that "[l]iability to the roll-back taxes shall attach when a change of use occurs, or a change of zoning of the real estate to a more intensive use at the request of the owner or his agent occurs." Changes in use must be reported to the local tax assessor.

Because "[t]axes can only be assessed, levied and collected in the manner prescribed by express statutory authority, [t]ax assessors have no power to make an assessment except in the manner prescribed by law[.]" I find no statutory authority for the assessment of roll-back tax liability based merely on the expiration of an open space use agreement. Per the plain language of § 58.1-3237, and "[c]onsistent with the statutory purpose, change in the use of the property is the event that triggers roll-back tax liability." Indeed, "[t]he statute does not purport to subject property to such property taxes unless its use [or zoning] changes." When "there has been no disqualifying change in the use of the qualifying property . . . there would be no liability for roll-back taxes."

Land use is distinct from participation in a land use tax program. Although an open space use agreement may be required for property to be assessed under a land use tax program, an agreement is not a factor in classifying the property as real estate devoted to open space in accordance with the qualifying uses established by the General Assembly. Accordingly, while failure to renew an open space use agreement, like failure to pay taxes, can warrant discontinuation of a property from the program, it does not affect the underlying use of the land. "[R]oll-back taxes are imposed only when the actual use of the land changes to a nonqualifying use[,]" and "[t]he mere fact that the parcel has been removed from the use value assessment program does not, of itself, subject such land to roll-back taxes." Indeed, imposing roll-back liability without an actual change to a nonqualifying use of the land would frustrate the purpose of the program by dissuading a property owner from entering into any open-space use agreement in the first instance. Because the expiration of an open-space use agreement does not render a previously qualifying use nonqualifying, I must conclude that the agreement's expiration, standing alone, does not trigger liability for roll-back taxes.

Conclusion

Accordingly, it is my opinion that the expiration of an open space use agreement is not a change in use and does not subject the property to roll back taxes.

With kindest regards, I am,

Very truly yours,

Jason S. Miyares
Attorney General