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0089633030 P•0~ AUG-01-2004 10:33 AM R. ALDERSON 1) 131 acres in Umauma; 80 acres usable; fenced and leased for cattle gran g pasture; lease amaunt $4,000/yr current tax .195/vr $3,805 gross/yr We invested $450,000 in this parcel. The current return is .8%; less than 1°/ ,not even keeping up with inflation. The ame property under Bi1149; appraised at $5,000/acre's value at $650;000; with the 10 yr dedication option, 50% exemption='s $325,000 taxable valuation; taxed at ] °/r-'s new tax amount of $3,250, so lease amount $4,000/yt new tax .3.250/vr $750 gross/yr The return would then be .166%. Then if next years' appraisal rises to $6,OOp/acre; the new tax would be $3,930; leaving a $70 return, on a $450, 00 investment. 2) 6I acres in Papaikou; 6 acres usable (due to rock); leased for truck farm; lease amount $1,500/yr cumnt tax ; ~ 26/vr $1,374 gross/yr This s a return of .4% ,again less than 1%. The s e property under Bu1149; appraised at $7,000/acre's value at $434', 00; with the 10 yr dedication option, 50% exemption='s $217,000 taxable valuation; taxed at 1 %~'s new tax amount of $2,170, so lease amount $],500/yr new tax -2,170/vr -$6701oes/yr Then if next year's appraisal rises to $8,000/acre; the new tax would be $2,480; leaving a -$9801oss. •The gures above are based on qualifying for the l 0yr dedication program. Thes 2 real examples demonstrate that as a land owner, leasing to farmers and r ' chars under the current Agriculture exemptions is not profit motiv td. The return does not even keep up with the inflation index, it has been o choice to continue with the Ag uses, however, because farming the land p motes smelt farm industry and keeps the land productive, green and boauti I. This is our personal reward; but not a prudent use of our mone;/.