By Ryan Conklin

This past year represented a time of significant changes for Ohio’s current agriculture use valuation (CAUV) property tax system. Those changes continued right up to the end of the year. On Dec. 7, 2017, the Ohio Supreme Court released a pair of decisions that impact Ohio landowners and their tax bills. In one of the opinions, the court indicated that farm owners will have the means to challenge a component of the CAUV formula for the first time ever.

Every year, the Ohio Tax Commissioner proposes tables that establish the taxable values for different types of farmland based on soil type. After publication of the proposed tables and the conducting of a public hearing, the tax commissioner adopts the values through a journal entry. The tax commissioner then forwards the adopted tables to the county auditors for use in determining the property tax bills in each county for a three-year period. This part is important to remember, because each time your property tax bill changes, it is taking into account three years worth of changes.

In Adams v. Testa, the Ohio Supreme Court determined that landowners can appeal the land value tables set by the tax commissioner because those tables constitute a “final determination” and are challengeable under Ohio law. Upon publication of the tables, landowners may appeal the soil values to the Board of Tax Appeals. This represents a faster path to relief for landowners, because they can immediately appeal the tax commissioner’s tables instead of waiting on the county auditor to send out tax bills.

However, in a companion case, also titled Adams v. Testa, the court ruled against landowners who argued that the soil values constituted a “final rule.” If the land values were found to be a final rule, the tax commissioner would need to complete the full administrative rule-making process, which takes more time and is a process that more closely involves the public.

With these rulings, landowners can now challenge the following areas pertaining to CAUV and their tax bills:

1. Land values as established by the Ohio tax commissioner.

2. Estimated cost of timber removal as established by the Ohio tax commissioner.

3. The incorrect application of values to qualifying conservation land as determined by the county auditor.

4. The incorrect application of a cropland value to woodlands on a property as determined by the county auditor.

5. The incorrect application of soil types on a particular property as determined by the county auditor.

6. Any denial of CAUV qualification as determined by the county auditor.

Landowners cannot challenge other components of the CAUV formula, such as capitalization rate, yield data, crop prices or rotations. That said, for the first two options landowners would file an appeal with the Ohio Board of Tax Appeals, as confirmed in the Supreme Court opinions.

With numbers three through six, the landowner would appeal to their County Board of Revision. Specifically regarding number three, farmers operating in 2017 reassessment counties can amend their 2017 CAUV renewal form to reflect qualifying conservation acreage. Under Ohio’s new CAUV law, your auditor would apply the conservation value to that land, which could lower your 2017 tax bill and result in a refund or credit on future taxes. If you missed the March 5, 2018 deadline to amend your 2017 CAUV renewal, you can file a challenge with your county’s Board of Revision.

When completing your CAUV renewal forms for 2018, you may need to provide additional verification that your land is engaged in conservation. If the auditor requests copies of federal conservation contracts, be sure to redact sensitive information from those contracts. Follow-up with your county auditor if you have concerns about the value applied to your conservation land.

Even though the Ohio Supreme Court has provided farmers and landowners with these new avenues of appeal, taxpayers will need to think critically before filing a challenge of any nature. If legal counsel must be involved, it can become a costly endeavor with very little benefit provided. Furthermore, as with any legal cause of action, success is not guaranteed.

Special thanks go out to Ohio Farm Bureau policy counsel Leah Curtis, who provided an excellent technical review of this piece. When it comes to all things CAUV, there is no better outlet for information then Ohio Farm Bureau. If you have further questions about this topic, I would encourage you to visit the organization’s CAUV page.

Conklin is an attorney at Wright & Moore Law Co. He can be reached by email at [email protected], or by calling his office at 740-990-0755.