None of Henry George’s books has the word “tax” in the title. This may be because he did not want his ideas to be framed as being mainly about taxes. His central message was that land should be “common property” and that a land value tax was a better means of achieving this goal as compared to governments holding title to all the land. However, his books never addressed land trusts as a means of making land common property.
Some of his followers, though, took this alternative route in the early 20th century. For example, Arden, Delaware was formed as a “single tax colony” and continues to the present day as a town in which homeowners have title to their houses while the town’s land trust has title to the land under the houses for which the homeowners pay rent. The town, which was formed on land purchased by wealthy donors, uses the collected land rent to fund the town’s services and to pay the homeowners’ school and county property taxes. None of the collected land rent is used for further land acquisition.
In recent decades, there has been a proliferation of a different kind of land trust called a Community Land Trust (CLT), which is used primarily to increase housing affordability by eliminating a down payment requirement and limiting how much CLT homes can be sold for. In a CLT a homeowner finances and has title to the house portion of a property while title to the underlying land is held by the CLT, which is usually a non-profit organization. But a CLT homeowner pays much less land rent (usually about $30 per month) than does an Arden homeowner and, unlike an Arden homeowner, is responsible for paying the home’s property taxes. When CLT homeowners sell their homes, they split any gain with the CLT, a feature that is absent from the Arden approach. Land acquisition by CLTs is usually done with funds obtained from foundations.
Two years ago, RSF formed a Land Trust Working Group (LTWG) to explore areas of interest such as:
- Whether more land trusts could include a variety of property values, which would permit the collection of higher amounts of land rent than land trusts that include only properties of below average value. This may require land trusts to be public entities because non-profit land trusts have to be primarily for a charitable purpose.
- Whether more land trusts could collect full land rent and use the collected rent to pay for further land acquisitions (which may allow land trusts to expand virally) and/or for common purposes such as public investments (e.g. light rail stations) and basic incomes.
Currently, LTWG members are meeting with land trust experts in order to draw on their knowledge and experience in these areas. Stay tuned for more updates on these efforts.