Farmers across Ohio have benefited in the past in regards to CAUV values that have been kept extremely low and now these values are scheduled to increase quite a bit in the next few years.
Ted Finnarn, Darke County attorney, is the Ohio Farmers Union representative to the Agricultural Advisory Committee of the Division of Tax Equalization and this CAUV Advisory Committee functions to advise the Ohio Department of Taxation on the operation of the Current Agricultural Use Valuation (CAUV) law and the consequent valuations used under the law.
Finnarn has served on this State Committee for over 38 years originally being appointed by the Ohio Farmers Union in 1976. Scott Zumbrink, Darke County Treasurer, has also served on the committee, representing the State Treasurers’ Association since 2007.
According to Finnarn and Zumbrink, the CAUV table valuations (which vary according to soil type, slope, drainage and soil management groups, using inputs of a 5-year “olympic” average of crop prices and costs of production) will increase substantially for tax year 2014 effective for taxes to be paid in 2015. When the more important comparison is made between the 2011 table valuations to the 2014 valuations (the 2011 table being the last one used by counties, which will now use the 2014 values, due to the 3 year rotation), farmers may see increases of approximately 110-185% or more in CAUV values.
Finnarn and Zumbrink said that CAUV values had been kept artificially low in the past since they were mainly dependent on crop prices – which were low – versus expenses. Federal government farm payments have never been taken into consideration. CAUV values got so low in some counties (circa tax year 2005) that farmers were only paying $3 – $4 per acre per year on some of their farm real estate.
“We had a real problem of almost losing the CAUV entirely during the summer of 2006 since the values were so much lower than the fair market value of farm real estate,” Finarn said.
Recently, the formula had to be adjusted and updated. With the 2008-2012 increase in crop prices coupled with lower interest rates, it was inevitable that the CAUV values would go up. Even though farmers may be paying more on their tax bill, they should realize that the highest CAUV values in the state will still be only around $5,030 per acre.
Montgomery county CAUV values have already skyrocketed out of control . Our farm CAUV. Values have doubled, tripled, and some are as much as 9 times the previous value. These taxes will be due in 2015.
In Morrow County my CAUV valuation is HIGHER than the appraised value. I have to investigate, but it looks like being enrolled in the CAUV program may be costing me money !
my taxes on the farm property went up almost 4x what I have been paying. putting the little country gentle farmer out. I can only feel for the larger farmers in my area. don’t be shocked when sweet corn,tomatoes,peppers and other produce double in price !!!
This is going to hurt farmers in the state of Ohio and will impact profits since these huge increases are difficult to pass on to consumers. What will the state of Ohio do with the additional tax revenue do to the CAUV changes? Tax pa
yers should demand an answer!
My family’s taxes have increased 12.2 times since 2005 and the Bono Soil type value has raised 33.8 times, Digby 30.6, and Pandora 28.5. Yet Millgrove, one of the most productive soils in Ohio, increased 7.74. Lower productivity soils have been impacted most yet can least afford this type of massive increase! Crop prices used in 2014 tax computations have increased in value 148.5% since 2005, but the majority of the massive value increase can be attributed to the yield factoring done by the Ohio Department of Taxation in 2006. Yields have been increased from the original formula; the excuse was that yields had not changed since the beginning of the CAUV formula. The 2014 yields are corn 185 up from 144, 28.5%, beans 64 up from 52, 23% and wheat 96 up from 64, 50%. With the 2014 crop prices this increased gross for corn $183.68, beans $121.56, and wheat 165.12 per acre. Note this is the additional gross that has been added over the Original formula. Cranking out the numbers crop prices went up 148.5% and resulted in 47.7% of the total increase for the Millgrove value, and factoring resulted in 52.2% of the increase. 148.5% crop prices only resulted in less than half of the total increase! Any comments from organizations that I have seen never mention the factoring of the yields, only the big crop price increase and the change in the capitalization rate. Is this factoring of yields a “dirty little secret” that no one wants to talk about? You be the judge I know what I think. Also consider the fact that the State wanted to decrease school funding, did this lead to factoring yields to help replace this decrease to the schools? My local school district has received about $2.4 million in increased revenue, primarily due to CAUV valuations, from 2007-2015. Their 2007 budget was about $9.5 million, that’s a 25.3% increase in revenue to the General Fund only, Bond retirement is yet more money. For my county since 2007 the school General Fund Real Estate taxes have increased 82% all with no additional voted millage. If you go to the State Department of Taxation website and look up any school in Ohio you can see what kind of budget they have. Several rural schools around our area are running anywhere from$3 million to $7.5 million cash balance and most of them have a positive cash balance for the given year, spending less than their yearly revenue. CAUV has been a windfall for local schools and yet I hear that education is lobbying Congress not to change the CAUV formula since they will lose money. At some point they are going to kill the goose that lays the golden egg, in this case Ohio Agricultural! Farmers need help and I expect the Ohio Farmers Union to step up to the plate and get serious and not just dance around the issue rather then roll up your sleeves and get serious with significant change. That goes for other farm organizations too but the verdict is certainly out on that!