Property Tax Impacts on the Timing of Land Use Conversion

This study investigates how property taxes a¤ect development timing. A theoretical framework motivates an empirical model that explores how land use change decisions are made over time. A survival model using plot level data is estimated to show how di¤erent factors in‡uence the timing of development of individual parcels. The results suggest that higher taxes slow development, as expected. Within our study region, we predict 25% more agricultural land would have converted to development if taxes had not risen. However, these e¤ects vary across di¤erent land qualities. In particular, higher taxes make higher quality agricultural land more susceptible to development.