If you’ve cleared or drained land over the last couple of years, Ohio Farm Bureau needs your help as it works to improve the accuracy of the Current Agricultural Use Value (CAUV) formula.
The Ohio Department of Taxation asked Agricultural Advisory Committee members recently if they could share receipts for the costs of clearing and draining land so it could better gauge those costs for the CAUV formula. OFBF Director of Agricultural Law Leah Curtis is a member of the committee, which also includes representatives from the Ohio Forestry Association, County Auditors’ Association of Ohio, County Treasurers Association of Ohio and Ohio Farmers Union.
Ohio Farm Bureau would like to compile receipts from members who have cleared or drained land in the last three years. Those who are willing to share those receipts (with private information redacted) should contact Ohio Farm Bureau Director of Legal Education Amy Milam at 614-246-8256 or [email protected].
At a recent meeting, Ohio Farm Bureau urged the tax department to further increase the deductions for woodland values, saying they don’t reflect the cost of clearing and draining land. Last year the tax department increased the costs of clearing woodlands from $500 to $1,000 per acre, from $500 to $770 for subsurface tile drainage and from $250 to $380 for surface drainage.
At the meeting, the tax department said the average CAUV value per acre in 2015 is $2,041 and the statewide average CAUV value is 54 percent of the statewide average market value.
Ohio Farm Bureau has made proposals to the tax department and state legislature to ensure the “CAUV calculation is true to its origins of valuing farmland using agricultural factors only,” Curtis said.
For more than a year, Ohio Farm Bureau has been challenging two inaccurate assumptions in the CAUV formula’s capitalization rate: that land is a short-term investment and that it becomes more valuable as its mortgage is paid down. Proposed legislation would prohibit certain nonagricultural factors from being used in the CAUV formula and remove disincentives for farmers to engage in certain conservation practices.