During that same period, property taxes on farmland jumped 38.6 percent.
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“It’s all because of what’s going on with assessed value,” he said.
A base rate per acre is set for all farmland in the state. That rate is calculated by the state’s Department of Local Government Finance and is based on rents, yields, commodity prices, costs and interest rates.
For the assessed value of an individual piece of farmland, that base rate is multiplied by the soil productivity factor for the acre. Assessments are reduced if “influence factors” such as frequent flooding or forest cover apply to the land.
The base rate keeps rising. If considered from a starting point in 2007, DeBoer said, the base rate “will have more than doubled by 2014.”
The reasons for the increase are positive — rising grain prices and low interest rates. Still, ever-increasing tax bills are not popular.
“I think you understand why farmers are so frustrated,” Ferris said. “There’s no end in sight.”
“Farmland assessments are going to go up over the next three years,” DeBoer predicted. He said he felt prepared to make such statements with confidence because the formula used to calculate the base rate has a four-year lag. In other words, assessments for 2013 will be based on data ending in 2009.
“People ask me if this summer’s drought will affect their property taxes,” DeBoer said. It will, he tells them, but “that will enter the formula for taxes in 2016.”
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DeBoer did deliver some good news for counties along the Ohio border. A proposal by the Legislative Services Bureau to revamp the soil productivity factors — unchanged since 1980 — has been postponed to 2014 at least.
Because of the calculations used, DeBoer said, the proposal would have raised soil productivity factors for most Wayne, Union, Randolph and Franklin counties from 28 to 45 percent. Bills have been introduced in the legislature that would block the proposal beyond 2014, he said.
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