Critics: Reducing Farmland Tax Would Cost Ohio Homeowners

May 9, 2016 07:00 PM
Critics: Reducing Farmland Tax Would Cost Ohio Homeowners

Ohio lawmakers are debating whether to reduce property taxes for farmers, a move critics say would raise taxes for rural homeowners and potentially cause school districts to lose state funding.

Proposed legislation in the House and Senate would alter the Current Agriculture Use Value, a complex property value adjustment for state farmland, The Columbus Dispatch reported.

The program leads to a lower property tax rate that helps farmers. But Brandon Kern, the director of state policy for the Ohio Farm Bureau, told House lawmakers that with rising crop prices and low interest rates, the CAUV has jumped nearly 300 percent from 2008 to 2014.

Kern said farmers have paid $370 million more in taxes, a 307 percent increase, outstripping the 100 percent increase in commodity prices.

The state started using more updated data last year that has pushed the CAUV down, but farmers still say more help is needed.

"Farmers have paid more and continue to pay more," Kern said. "It's more about getting an accurate value for us, in the end."

Proposed legislation would further reduce farmland values, possibly by more than 25 percent.

A 27 percent reduction would result in residential property owners paying an estimated $71 million more in property taxes, according to an analysis by the nonpartisan Legislative Service Commission. At 13 percent, homeowners would pay an extra $34 million.

Howard Fleeter, an analyst who works for the state's major public education advocacy groups, said that if farmland values drop, urban and suburban school districts will look wealthier under the state's school funding formula, which would likely lead to less money.

Schools could lose at least $15 million in annual local tax losses. Local governments could lose $17 million, according to the Legislative Service Commission.

The Ohio Department of Taxation hasn't taken a position on the bill, a spokesman said.

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Spell Check

Vernon Center, MN
5/10/2016 02:31 PM

  we farmers in Minnesota pay about 80 % for new cost of buildings. operating funds are based on 1 acre plus vaule of house. neiboring districts passed new referrendoms costing 20 dollars more per acre for new buildings ouch . really makes me mad when own land in indistrict but live in another I can not vote. but they take my money no quistions asked

Bellbrook, OH
5/10/2016 08:54 AM

  I am trying to understand why residential taxpayers would need to pay more if farm taxpayers bills get rolled back. Isn't that $370 million increase on farmers really a windfall to the states coffers? It seems that increasing residential taxes to offset lower farmland taxes would only continue the windfall???

Western, NE
5/10/2016 10:07 AM

  Looks like Ohio has the same problem that Nebraska has--a poor state aid to schools formula. A formula that gives income tax dollars to districts with low property taxes while giving none to those that have high property taxes. In every legislature's quest to reduce income taxes, they just shift the burden to property owners and increase their property taxes. Schools need to be funded fairly with a mix of income, sales and property taxes. That means income taxes probably need to go up and sales taxes need to be appropriately targeted.


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