Senate Ways and Means Hearing 3:30 today 2/27/14 Go to Status and Things to Do and contact the members.
Farming in this State is Diverse
Farms come in all sizes and shapes and methods of operation and practice. Farms range from very large to very small. Farmers sell direct to institutions or to their neighbors, sell to chain restaurants and 5 star restaurants, sell to wholesalers and retailers, and sell at the farmers market or through a CSA.
The Current Use Property Tax Program Goal is to Preserve and Maintain Farmland – Lets make it work for Today’s Farm
Under the Current Use Program farm land is taxed based on “current use” instead of fair market value. This reduces pressures for conversion to development. It decreases costs, and keeps farmers farming.
Small and Large Farms Participate in the Program – Unique Eligibility Standards Make Sense for Small Farms – But they have to relate to the real world of real farmers and the mounting pressures on land availability in this state
Land in the program is classified by acreage; small farms are under 20 acres and large farms are 20 acres and over. Enrollees must be engaged in commercial activities and are subject to examination by the County Assessor. Small farms must meet gross income thresholds in order to establish they are actively farming.
Assessment Practice for the Farm Residence – Need to make this Available for Small Farms
On a large farm all of the land, including land under the farm residence if integral to the farm operation, is taxed at current use. This is because this land contributes to the farm. But, today small farms are taxed at fair market value on a one acre lot around their farmstead, no matter how that land is used. This lot does not really exist and cannot be sold. The high taxes on this fictional lot are a financial burden to small farmers. We need to find a way to make small farms eligible for the same treatment as their large counterparts.
The Current Use Program Needs Modernization for Today’s Farms
Small farms and farms with dispersed parcels are becoming increasingly important in this state, particularly in areas where land is pressured by growth and development. A number of issues need to be examined regarding types of operations and eligibility under the program. Most everyone agrees we need better information before the Legislature can decide what criteria makes sense for today’s farmer.
Evaluate the Viability of Small Farms and Other Farm Operations
The study will evaluate ways to improve the viability of small farms and other farming operations under the current use program and recommend updated eligibility requirements if appropriate. DOR is tasked with this work.
We Support an Amendment to have the Study done jointly between DOR and the State Conservation Commission. DOR knows taxes, the SCC knows farming. They are the right team to do this study.