How we Stop APR from abusing Montana’s tax code
By Rep. Dan Bartel
In central Montana the American Prairie Reserve has amassed 420,000 acres of prime ranch land. This is a fraction of their ultimate objective: to control 3.2 million acres. The land they acquire will eventually be taken out of agricultural production and “re-wilded.” The thriving ranching communities in and around APR’s 5,000 square mile target area will be wiped off the map.
If you’re a Montana taxpayer, you’re helping APR pay for their radical plan.
APR is a 501(c)3 charitable organization. They are exempt from paying state and federal income taxes. On top of that, their donors receive a charitable tax deduction for contributions made to APR. For every dollar contributed to APR, the government treasury receives less than it otherwise would have.
This was the idea behind 501(c)3 charities. Taxpayers indirectly fund charitable work by allowing tax deductions for philanthropists.
Over time, however, the scope of what qualifies as charitable work has drifted. That leads to the question: should APR’s model of purchasing prime ag land and taking it out of production be considered a charitable purpose? Is that an activity that should be subsidized by taxpayers?
The answer is obviously no. APR’s plan places a burden on all Montanans. Not only are we subsidizing their land purchases today, but in the future our tax base shrinks as they take millions of acres out of economic production.
The tax exemption APR enjoys also gives them a major advantage in the marketplace for land. APR is able to pay premium prices as they compete directly against young farmers and ranchers trying to get their start.
It shouldn’t be this way. There is nothing charitable about APR’s plan. That’s why I am sponsoring legislation to prohibit organizations from purchasing large parcels of agricultural land through a nonprofit entity.
The policy my legislation implements is simple—we should not give tax breaks to allow organizations to amass property, especially when those groups intend to take that land out of production.
There is ample justification to place limitations on what charitable groups can do. Nonprofit groups enjoy special privileges. As privileged organizations, the IRS limits what type of activities qualify as charitable.
Federal laws also limit the Constitutional rights of nonprofits. For example, 501(c)3’s are limited in the amount of lobbying activity they can conduct, and are not allowed to participate in political races.
To be clear, my legislation does not outright prohibit organizations like APR from buying agricultural land—it only says that they cannot use a nonprofit vehicle to do so. APR and other nonprofits are free to organize for-profit entities through which to make their land purchases. The only difference is they will be required to pay taxes like the rest of us.
In my area of the state there is a strong movement to Stop APR. I wish I could say that we can legislate them out of existence, but that’s not the way the law works. But at least we can level the playing field and stop APR from abusing the tax code by forcing all Montanans to subsidize their radical plan.
Rep. Dan Bartel serves House District 29 in central Montana. He lives in Lewistown.