The tax man may be coming for Bruce Springsteen, Jon Bon Jovi and other wealthy New Jersey residents who for years have qualified for sizable tax breaks on their land because of a decades-old state law aimed at helping farmers. The law, which was passed in 1964, gave farmers in the state a 98 percent tax exemption on their non-residential property if they produced more than $500 in revenue on 5 acres or more. The revised law nudges that minimum to $1,000 in order to get the same break.
While it certainly helps oft-struggling family farms and larger operations, a 2010 investigation by the Asbury Park Press uncovered how wealthy residents who made their fortunes in business, music and politics have also benefited from the law. Former Gov. Christie Whitman paid $1,694 on 232 acres; Bon Jovi paid $104 on 7 acres; E Street Band drummer Max Weinberg shelled out $122 on 34 acres; and Springsteen paid $4,600 on 200 acres.
Springsteen super fan Gov. Chris Christie signed the updated law in 2013.
In order to have their respective lands fall under the 1964 law, Weinberg sells wood, Whitman raises sheep, Bon Jovi raises honeybees and Springsteen leases his land to an organic farmer.
Critics of the practice, like New Jersey Sierra Club director Jeff Tittel, see the revised law as a fiscal necessity and a way to bring fairness to the municipal tax code. “The fake farms are horrendous because the rich people are making everyone else suffer and won’t pay their fair share of taxes,” he told The Record newspaper. He added that the tax incentives pass the “cost on to everyone else who has to pay the difference to the municipality.”
When reached by Billboard, Ed Wengryn of the New Jersey Farm Bureau said the issue comes down to whether the land is actually being farmed or not. Springsteen, who has a certified organic farm on his land, passes that test. “The farmer who runs that busts his butt farming that land,” Wengryn said. “Nobody would doubt, looking at it, that it’s a farm. It’s not based on the income of the owner of the land, but what that land is being used for.”
But as for Bon Jovi, Whitman and others — including magazine publisher Steve Forbes, who also utilizes the break — “our response is, is the land being farmed? If it is, that’s a benefit to everybody. Without Bruce making that land available to that farmer, one he wouldn’t have a business, and it’s fresh local food going into the communities in that area. That’s what the program is supposed to do. The owner of the land, to us, is irrelevant.”
At its core, Wengryn explained, it is a local municipal tax issue. “It’s assessed at the local level — if the land’s being farmed, you don’t have houses on it, you don’t have kids going to school, you don’t need emergency services as much — infrastructure required for residential development.
A representative for Springsteen did not immediately respond to request for comment.
When it goes into effect in August, the revised law will also add more paperwork, regulations and inspections for all 9,000-plus farmland-assessed properties statewide. “The farmers will have to show that they are actively working the land,” State Sen. Jennifer Beck, a co-sponsor of the revisions, told The Record.
Whether many of the famous farmers will lose the tax break remains to be seen (bringing in $1,000 per year in honey or tree sales doesn’t sound very steep), but it has brought some unwanted attention to some of Jersey’s native sons and given local editorial writers something to get riled up about. The Burlington County Times singled out Springsteen’s $4,600 tax bill for his 200 acres: “Springsteen pulls this off by hiring a guy to grow organic vegetables on a few acres, triggering his steep tax discount. Let’s see how much Bruce pays under the revised law. When he gets his bill, he might consider covering the Beatles’ ‘Taxman.'”