COLUMBUS - State Senator Cliff Hite (R-Findlay) announced the passage of legislation today in the Ohio Senate aimed at updating the way agricultural property values are calculated in order to alleviate the heavy financial burden on Ohio's farmers. 

The proposal modifies the Current Agricultural Use Valuation (CAUV) formula, which determines the value of farmland for property taxation purposes, and aims to set a more realistic and stable expectation of taxes owed by farmers. Commodity prices dropped significantly in the last several years while the CAUV formula sent farm property assessments skyrocketing, putting many family farms in jeopardy. Recent farmland property taxes have increased by as much as 300 percent in some areas of the state.

“Many farmers simply can not afford to keep farming their land without CAUV reform,” said Hite. “This legislation will make important adjustments to ensure agricultural property values are calculated in a manner that is more reflective of their land use. These changes will help incentivize conservation practices—an important part of Ohio's efforts to protect its natural resources."

Farmland taxes have been increasing at substantial rates over the last several years, and Senate Bill 36 ensures that the taxes paid by farmers are more closely tied to the income producing potential of the land.

The bill removes two factors from the existing CAUV formula, land value appreciation and equity buildup, which arbitrarily inflate the value of farmland based on market considerations. 

CAUV is a property tax relief program for agricultural land in Ohio. It is the result of a voter referendum from 1973 that allows farmland to be taxed according to its agricultural value, as opposed to full market value. This program is considered a “differential assessment,” a type of tax relief used for agriculture in the United States. 

Senate Bill 36, sponsored by Hite, passed the Senate with unanimous support and will now go to the House of Representatives for further consideration. 
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