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Enough with estate tax’s ‘sour grapes’


Napa Valley Register

Monday, November 1, 2010

Click here to watch a video of Jeff Page sharing his story!

By Jeff Page

If you’ve sipped on a syrah or cabernet from the Napa Valley region, chances are you’ve enjoyed some of the harvest from my family’s third-generation-owned vineyard.

The Page family has been farming Napa Valley since the 1880s, when my great-grandfather bought his first 50 acres to grow orchard fruit and raise Hereford cattle, sheep and turkeys. At that time, winemaking and grape growing was going on mostly upvalley; orchard fruit growing and the like happened down-valley.

Two generations of Pages had great success in farming, but that success was put in jeopardy for the next generation when my grandfather fell ill and passed away.

In 1972, the IRS handed my grandmother a debilitating Federal Estate Tax bill. Due to the value of the land, livestock and equipment, the total bill literally cleaned the family out. Paying the tax took most of her cash and investments, eventually forcing her to sell everything but the core ranch. Pasture land and rental properties were sold off to raise cash. Even the home ranch had to be leased out.

Even this would not be enough. To pay the tax and hold onto the core ranch, the family had to divert the remaining cash to non-farm investments to prepare for the next round of estate tax, when my grandmother eventually passed away.

I try not to think about the opportunities lost when all that land was sold to pay estate taxes — the ranch hands we had to let go, the extra acres of vines that we could have planted, and the winery we might have built. But, unfortunately, in order to have a chance to pass on what’s left of the family farm to my children, the “death tax” threat is always front and center in my mind.

What that means is that instead of living my life and farming top-quality wine grapes, I am paying crippling life insurance and estate tax lawyer fees that could be better spent on producing jobs, growing our crops and supporting the community.

My story is not unique. Throughout Napa Valley and beyond, you will find farmers whose hard work is threatened every generation. According to Congress’s Joint Economic Committee, 24,000 family farmers paid the death tax between 1995 and 2005. Regardless of what they grow or raise, the story is the same: the farm may have to be sold to pay the death tax.

The loss is not only for the farmer, but also for the workers who are never hired. The American Family Business Foundation estimates that 1.6 million jobs will be lost if the death tax is reinstated at 55 percent starting in 2011, which it is set to do unless Congress acts first.

On the other hand, if Congress were to extend this year’s estate tax repeal permanently, California would gain nearly 180,000 jobs, according to the Pacific Research Institute. Some of those jobs would likely be on my own vineyard.

It would seem that in this economy especially, California’s Senate delegation would support permanent repeal of the estate tax for all the state’s family-owned businesses. Unfortunately, Sen. Barbara Boxer has fiercely opposed repeal for at least the last 10 years of her career and appears to show no sign of change. Yet her opponent, Carly Fiorina, has signed a pledge to support permanent repeal if she is elected.

The Page family has had enough of the death tax’s sour grapes. This November, we are hoping for new leadership in the U.S. Senate.

The Page family farm — and thousands like ours — stands in the balance.

Jeff Page / Napa

Read more: http://napavalleyregister.com/news/opinion/mailbag/article_42d46ef8-e76d-11df-b7e1-001cc4c03286.html

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