Current Agricultural Use Values (CAUV) TY 2018 Public Hearing DIVISION OF TAX EQUALIZATION JUNE 26, hio. Department of Taxation

Size: px

Start display at page:

Download "Current Agricultural Use Values (CAUV) TY 2018 Public Hearing DIVISION OF TAX EQUALIZATION JUNE 26, hio. Department of Taxation"

Augusta Long
5 years ago
Views:

1 Current Agricultural Use Values (CAUV) TY 2018 Public Hearing DIVISION OF TAX EQUALIZATION JUNE 26, 2018 hio Department of Taxation

2 Introduction This is a public hearing before the Ohio Department of Taxation to present data on the proposed tax year 2018 Current Agricultural Use Values (CAUV).

3 Outline Factors used in the Calculation Crop yields & cropping pattern Crop prices & non-land production costs Capitalization Rate 2018 Soil Values Two-Cycle Phase-In Average Cropland Values Comparative Charts USDA Cropland Value Woodland & Conservation Map County reported data for 2017

4 Basic Formula GOI Crop Yield x Average Crop Price NOI = GOI Non-land Production Costs Value = NOI/Capitalization Rate

Crop Yields/Cropping Pattern Soil yields from 1984:

five-year average of acres harvested, 2013-2017:

5 Crop Yields/Cropping Pattern Soil yields from 1984: adjusted by 10-year average of actual yields per acre for Single crop pattern for most soils based on five-year average of acres harvested, : Corn 39% Soybeans 55% Wheat 6% Maintain 50% corn & 50% soybeans for organic and frequently flooded soils.

6 CROP PRICES USED IN FIVE YR. AVERAGE USDA National Agricultural Statistics Service Crop Year CORN SOYBEANS WHEAT $3.55 $3.60 $3.89 $3.78 $4.41 $7.09 $6.44 $9.50 $9.65 $9.16 $10.30 $13.00 $14.60 $13.00 $4.90 $4.25 $4.57 $5.60 $6.54 $7.94 $ $5.45 $11.50 $ $3.55 $9.78 $4.41

7 Adjusted Crop Prices in the Formula, Variance Corn $4.55 $4.51 $4.18 ($0.37) ($0.33) -8.1% -7.3% Beans $11.09 $10.83 $10.43 ($0.66) ($0.04) -6.0% -3.7% Wheat $5.67 $5.53 $5.52 ($0.15) ($0.01) -2.6% -0.2%

8 Non-Land Production Costs Base & Added Unit, Variance Corn $ $ $ $12.29 ($9.50) +bu $1.36 $1.45 $1.44 $0.08 ($0.01) Beans $ $ $ $20.84 ($0.84) +bu $1.24 $1.05 $0.94 ($0.30) ($0.11) Wheat $ $ $ $33.55 ($5.68) +bu $1.77 $1.62 $1.49 ($0.28) ($0.13)

9 Capitalization Rate % Debt/20% Equity: Farm Credit Services 25-Yr. Multi-Flex Loan 80% Loan x Annual Debt Service * USDA 25-Yr. Farm Equity - 20% Equity x Equity Yield Rate of 7.73% + Subtotal Less: Equity Buildup for 25 years Subtotal (0.0114) Plus: Tax Additur Capitalization Rate + Total % *Mortgage constant assumes 25-year loan, 5.52% interest rate.

10 Capitalization Rate TY 2015 & Mortgage/Equity Ratio 80/20 80/20 Interest Rate, 25-Year Fixed Multi-flex Loan* Equity Rate** Tax Additur Capitalization Rate 6.6% 8.0% *Farm Credit Services 25-year fixed multi-flex rate for loan amounts $75,000 and over. **Equity Rate 2015: prime lending rate plus 2%. 2018: 25-year avg. rate of return on farm equity/usda.

11 Two-Cycle Phase-In Phased in over next two revaluations, beginning with counties undergoing reappraisal or update in 2017: Values are sum of the new formula values for 2017 and half the positive difference between the formula values and the values for Values established for 2017, 2018, and R.C (A)(3)(a) Counties scheduled in 2018 will have calculation based on formula values for 2018 and adjusted values for R.C (A)(3)(b)

12 2018 Soil Values Phase-In Miami Silt Loam Millgrove Silt Loam 2-6% Slope 0-2% Slope PI 76 PI New Formula $ 1,440 $ 3, Value $ 1,950 $ 4,205 +Half the Difference Adjusted Value $ 1,700 $ 3, Value $ 2,350 $ 4,770 % Decrease % -20.1%

13 Cropland, Simple Average CAUV Value by Productivity Index PI $ 200 $ 300 $ 350 $ 350 $ 350 $ 350 $ 350 $ 350 $ ,218 1,778 1,371 1,235 1, ,126 1,147 1,958 2,728 2,347 2,255 1,969 1, ,278 1,641 1,717 2,743 3,718 3,354 3,302 2,909 2, ,601 2,017 2,128 3,310 4,428 4,104 4,074 3,602 3, ,900 2,380 2,490 3,780 5,030 4,770 4,750 4,205 3,810 All Soils $ 505 $ 700 $ 719 $1205 $1668 $1388 $1310 $1153 Average $1015

Cropland, Average CAUV (Formula) 2003-2018 $1,800

14 Cropland, Average CAUV (Formula) $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 $1,668 $1,388 $1,310 $1,153 $1,015 $719 $459 $163 $

$3,830 $3,000 $2,000 $2,750 1205 1388 1310 1153 CAUV = 20% of USDA value D

15 Average CAUV (Formula) & Ohio Cropland Value USDA Dollars per Acre, $6,000 $5,650 $5,850 $5,800 $5,780 $5,000 $4,640 $4,000 $3,470 $3,830 $3,000 $2,000 $2, CAUV = 20% of USDA value D USDA CAUV $1,000 $ Tax Year

16 Average Woodland Value CAUV Formula Slope 25% or Less Maximum $4,030 $3,030 $3,040 $2,575 $2,190 Median $1,050 $230 $230 $230 $230 Average $1,171 $603 $563 $459 $383 Minimum value: all slopes $230 $230 $230 $230 $230 Number of soils at minimum value: slope 25% or less 1,097 1,974 2,128 2,128 2,130

17 HB 49 Conservation Land Land used for conservation practices (25%) or under a qualifying retirement or conservation contract: Receives lowest value in the Table ($230). R.C Under contract with federal government: As of January 1 st of the tax year starting with 2017 reappraisal/update counties R.C (A)(3) If use changes sooner than 36 months after initial certification, auditor recoups extra tax savings. R.C

V-6C (201 7) Source: DTE 114 2017 CAUV Value as a Percent of Market Value Statewide average is 41 % WI LLIAMS 67 DEFIANCE 42 FULTON 43 HENRY 4 1 PUTNAM 32 ALLEN 57 AUGLAIZE MERCER 47 24 ~------l

18 V-6C (201 7) Source: DTE CAUV Value as a Percent of Market Value Statewide average is 41 % WI LLIAMS 67 DEFIANCE 42 FULTON 43 HENRY 4 1 PUTNAM 32 ALLEN 57 AUGLAIZE MERCER ~------l SHELBY DARKE 34 MIAM I PREBLE 38 BUTLER 31 HAMILTON LUCAS 54 WOOD 52 HANCOCK 43 HARDIN 4 2 LOGAN 50 UNION 30 r----,. Jc 46 WARREN 36 LERMONT 34 CHAMPAIGN 52 GREENE MADISON FAYETTE 89 OTTAWA 65 SANDUSKY 61 SENECA 44 DELAWARE 25 FRANKLIN 26 PICKAWAY 40 ROSS 81 ERIE 47 HURON 36 KNOX 38 LICKING HOLMES LAKE I ASHTABULA 29 TRUMBULL 44 SUMMIT PORTAGE f MAHONING 37,~ STARK 29 CARROLL 35 I TUSCARAWAS [ FFERSO HARRISON BELMONT 46 %of Market No. of Counties D D D 28 ~ 50 D 23

Questions? www.tax.ohio.gov Government, Real Property Tax Ohio Dept.

19 Questions? Government, Real Property Tax Ohio Dept. of Taxation Tax Equalization Division

Western Ohio Cropland Values and Cash Rents

AEDE-RP-0136-11 Western Ohio Cropland Values and Cash Rents 2011-12 Barry Ward (ward.8@osu.edu) Leader Production Business Management OSU Extension, OSU Department of Agricultural, Environmental and Development