As reform efforts continue, CAUV preliminary values reviewed

The Ohio Department of Taxation recently provided Ohio Farm Bureau and other members of its Agricultural Advisory Committee a preliminary Current Agricultural Use Value (CAUV) calculation for 2017. The preliminary calculation indicates that those counties on the 2017 reappraisal/update cycle will likely see a decrease in CAUV values from their 2014 CAUV values. Forty-one counties are set to be reappraised or updated in 2017, and as a result, will receive new CAUV values and tax bills in January 2018.

“The extent of any decrease in value cannot be confirmed until the calculation is finalized in June, but we can safely say it will not come close to alleviating the increases farmers have seen since 2008 and why we continue to work for further reform,” said Leah Curtis, OFBF’s policy counsel.

CAUV map insert

The projected decreases in value are a product of the changes secured by OFBF to the CAUV calculation. Those changes updated the lending assumptions in the formula and made sure the most timely data available is being used to value farmland.

Keep in mind that a landowner’s tax bill is the combination of his or her CAUV value and locally determined tax rates, said Curtis. Changes in local millage also affect changes in the tax bill, so the amount of reduction in taxes will depend on the individual’s taxing district.  While values might decrease, the effect on a landowner’s taxes could be minimal depending on their individual situation, she added.

Ohio Farm Bureau has led the way with concrete reforms to the CAUV program, which taxes farmland for its agricultural value rather than its fair market value.

Some of OFBF’s suggested reforms have been adopted, resulting in an additional average savings of $10 per acre in counties reappraised since 2015.

“Further CAUV reform continues to be a top priority of OFBF, but we are glad to see the changes we have already secured are continuing to make an impact on values,” Curtis said.

Ohio Farm Bureau wants to ensure members are kept as up to date as possible on this issue. If a member’s email address is on file, he or she will receive any action alerts on this issue. To provide your email address or verify what email address is on file, click on Your Account in the upper right corner of ofbf.org.

Photo: Speaker of the Ohio House Clifford A. Rosenberger, R-Clarksville, met with OFBF President Frank Burkett, left, Executive Vice President Adam Sharp, right, and the OFBF board of trustees in April and had a positive conversation on how to move CAUV legislation forward.

Ohio Farm Bureau membership

4 thoughts on “As reform efforts continue, CAUV preliminary values reviewed

  1. Avatar Carol Pabst says:

    Explain to me why the CAUV worked so well for so many years and all of a sudden it has gone hay wire? Makes me wonder who has messed with it and why? We farmers have a hard enough time making ends meet no wonder so many small farms are going broke! Might be what big gov. wants.

    1. Avatar Leah Curtis says:

      The CAUV calculation has worked well for many years. However, we feel we have identified some flaws in the formula that became more present as there was a significant disruption in the world economy, along with the lowering of interest rates by the Federal Reserve. While none of those things had any intent to impact CAUV, they were situations that were not foreseen by the calculation’s creators in the 1970’s, nor had they been experienced in the past. The reforms we have been working for are trying to reduce impacts like these in the future and ensure the results of the calculation are tied as closely to the farm economy as possible.

      1. Avatar Bud McDermott says:

        Leah, I was at a meeting last month and a farmer (older retired gentleman)
        mentioned that when the program started back in the 70’s three were never any issues, however in 84? the state changed it. Is that when they added these computation methods to obtain the values they now put out? It seems to me these computations and tables are to affected by the market. Since 08 the market declined, affecting the real estate market and rates and gas prices increased. Is this the perfect storm of the program?

        1. Avatar Leah Curtis says:

          Bud, I am not aware of any specific changes that occurred in 1984, although small changes have been made over time in the formula to represent how the ag economy is working. For example, in 2015, we were able to secure changes to the loan assumptions to ensure they mirrored typical farm loans of today (for example, utilizing 25 year loan rates rather than 15 year ). The intent of the program has always been to follow the farm economy. Certainly, many have referred to what occurred in 2014 as a “perfect storm” situation, where historically high crop prices came into the formula at the same time as historically low interest rates, followed up with drops in real-time crop prices. We are attempting to make changes to the formula to ensure that the values are tied as closely to the farm economy as possible.

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