current agricultural use values (cauv) ty 2019 agricultural … · 2019-07-08 · introduction....
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Current Agricultural Use Values (CAUV) TY 2019
Agricultural Advisory Committee Meeting
DIVISION OF TAX EQUALIZATION
JUNE 27, 2019
of Taxation
Introduction
This is a public hearing before the Ohio Department of Taxation to present data on the proposed tax year 2019 CurrentAgricultural Use Values (CAUV).
Outline
Factors used in the Calculation ◦Crop yields & cropping pattern ◦Crop prices & non‐land production costs ◦Capitalization Rate
2019 Soil Values ◦Two‐Cycle Phase‐In ◦Average Cropland Values ◦Comparative Charts – USDA Cropland Value ◦Woodland & Conservation ◦Map – County reported data for 2018
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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: – adjusted by 10‐year average ofactual yields per acre for 2009‐18.
• Single crop pattern for most soils based on five‐year average of acres harvested, 2014‐2018: – Corn 38% – Soybeans 56% – Wheat 6%
• Maintain 50% corn & 50% soybeans for organic and frequently flooded soils.
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CROP PRICES USED IN FIVE YR. AVERAGE USDA National Agricultural Statistics Service Crop Year CORN SOYBEANS WHEAT
2018 2017 2016 2015 2014 2013 2012
$3.65 $3.61 $3.61 $3.89 $3.78 $4.41 $7.09
$8.75 $9.62 $9.66 $9.16
$10.30 $13.00 $14.60
$5.05 $4.90 $4.25 $4.57 $5.60 $6.54 $7.94
2011 $6.44 $13.00 $6.73 2010 $5.45 $11.50 $5.21
Adjusted Crop Prices in the Formula, 2016‐2019
2016 2018 2019
Variance
2016‐19 2018‐19
Corn $4.49 $4.18 $3.68 ($0.81) ‐18.0%
($0.50) ‐12.0%
Beans $10.91 $10.43 $9.78 ($1.13) ‐10.4%
($0.65) ‐6.2%
Wheat $5.53 $5.52 $5.15 ($0.38) ‐6.9%
($0.37) ‐6.7%
Non‐Land Production Costs Base & Added Unit, 2016‐2019
2016 2018 2019
Variance
2016‐19 2018‐19
Corn +bu
$524.47
$1.38
$529.28 $1.44
$519.04 $1.43
($5.43) ($10.24) $0.05 ($0.01)
Beans +bu
$336.33 $1.07
$346.26
$0.94
$338.54
$0.90
$2.21
($0.17) ($7.72) ($0.04)
Wheat +bu
$323.52 $1.64
$330.53 $1.49
$319.08 $1.41
($4.44) ($11.45) ($0.23) ($0.08)
Capitalization Rate TY 2016 & 2019
2016 2019
Mortgage/Equity Ratio 80/20 80/20
Interest Rate, 25‐Year Fixed
Multi‐flex Loan* 5.76 5.69
Equity Rate** 5.25 7.55
Tax Additur 1.6 1.6
Capitalization Rate 6.3% 8.0%
*Farm Credit Services 25‐year fixed multi‐flex rate for loan amounts $75,000 and over.
**Equity Rate 2016: prime lending rate plus 2%. 2019: 25‐year avg. rate of return on farm equity/USDA.
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 decrease between the “formula values” and the values for 2016. ◦ Values established for 2017, 2018, and 2019. R.C.5715.01(A)(3)(a)
Counties scheduled in 2019 will have calculation based on “formula values” for 2019 and adjusted values for 2018. R.C. 5715.01(A)(3)(b)
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2019 Sample Calculation ‐ Millgrove Slope, Erosion: 0-2, Slight Drainage: Very Poorly Prod. Index: 100
CORN BEANS WHEAT Adjusted Yield (bu/A) 200 72 102 X Crop Price/unit $3.68 $9.78 $5.15 = GROSS INCOME / ACRE $736.00 $704.16 $525.30
Adjusted Yield (bu/A) 200 72 102 Base Yield 131 39 58 = YIELD ABOVE BASE 69 33 44 X Added Unit Cost $1.43 $0.90 $1.41 = ADDED UNIT COST/ACRE $98.67 $29.70 $62.04 + Base Yield Cost/Acre $519.04 $338.54 $319.08 = TOTAL NON-LAND PROD. COST $617.71 $368.24 $381.12
NET RETURN / ACRE $118.29 $335.92 $144.18 X Cropping Pattern 0.38 0.56 0.06 = ROTATIONAL NET RETURN/Acre $44.95 $188.12 $8.65
TOTAL ROTATIONAL NET RETURN $241.72 Capitalization Rate 0.08 CAUV VALUE/ACRE:
Net Return/Cap Rate $3,021.45 SAY $3,020 2018 Value $3,810 ADJUSTED CAUV VALUE $3,420
Cropland, Simple Average CAUV Value by Productivity Index
2011‐2019 PI 2011 2012 2013 2014 2015 2016 2017 2018 2019
0‐49 $ 300 $ 350 $ 350 $ 350 $ 350 $ 350 $ 350 $ 350 $ 350
50‐59 328 362 516 700 518 466 430 400 378
60‐69 632 610 1,218 1,778 1,371 1,235 1,061 896 731
70‐79 1,126 1,147 1,958 2,728 2,347 2,255 1,969 1,723 1,469
80‐89
90‐99
100+
1,641
2,017
2,380
1,717
2,128
2,490
2,743
3,310
3,780
3,718
4,428
5,030
3,354
4,104
4,770
3,302
4,074
4,750
2,909
3,602
4,205
2,586
3,226
3,810
2,270
2,863
3,420
All Soils Average
$ 700 $ 719 $1205 $1668 $1388 $1310 $1153 $1015 $876
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I I I I I I I I I
Cropland, Average CAUV (Formula) 2004‐2019
$200
$400
$600
$800
$1,000
$1,200
$1,400
$135 $181
$505
$1,205
$1,388 $1,310
$1,153 $1,015
$876
$0 2004 2007 2010 2013 2015 2016 2017 2018 2019
Average CAUV (Formula) & Ohio Cropland Value – USDA Dollars per Acre, 2004‐2018
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
USDA Tax YearCAUV
$2,920
$3,820 $3,900
$5,190
$5,850 $5,800 $5,780 $5,850
135 181 505
1205 1388 1310 1153 1015
CAUV = 17.4% of USDA value
2004 2007 2010 2013 2015 2016 2017 2018
D •
Average Woodland Value CAUV Formula
2015 2016 2017 2018 2019
Slope 25% or Less Maximum $3,030 $3,040 $2,575 $2,190 $1,840
Median $230 $230 $230 $230 $230
Average $603 $563 $459 $383 $325
Minimum value: all slopes $230 $230 $230 $230 $230
Number of soils at minimum value: slope 25% or less 1,974 2,128 2,128 2,130 2,130
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. 5713.31
Under contract with federal government: ◦ As of January 1st of the tax year starting with 2017 reappraisal/update counties R.C.5715.01(A)(3)
◦ If use changes sooner than 36 months after initial certification, auditor recoups extra tax savings. R.C. 5713.34
31
WILLIAMS FULTON
43 42
Statewide average is 37%
WOOD
S2
ASHTABULA
29
TRUMBULL
44
V-6C (2018) Source: DTE 114 2018 CAUV Value
as a Percent of Market Value
MERCER 24
DARKE 33
PREBLE 38
BUTLER
HURON SENECA 2344
ANDOT RAWFORD52 24 RICHLAND
'-,__r-_,._----f 37
AUGLAIZE MORROWl.._ 46 40
LOGAN
50 UNION
r---~-.L. 46
MIAMI
42
CHAMPAIGN 52
CLARK
LICKING
29
MONTGOME 51 35 46
GREENE 37
MADISON
FAYETTE 38
PICKAWAY 39
WARREN CLINTON
24 37
SUMMIT PORTAGE 25 29 f------l
MAHONING
37
'--
%of Market No. of Counties
10 - 29 D 20 30 - 39 30 40 - 49 D 26
~ 50 D 12
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Questions? www.tax.ohio.gov
Government, Real Property Tax
Ohio Deptartment of TaxationTax Equalization Division
614.466.5744
614.466.4959