NY Farm Leaders Push Property Tax Reform

6/8/2013 7:00 AM
By Paul Post New York Correspondent

ALBANY, N.Y. — New York farm leaders are pushing for quick adoption of a bill that would cap agricultural land assessments at 2 percent.

Currently, New York farmers pay an average $38.41 per acre in property taxes, the second highest rate in the country, which eats up 15 percent of their income.

On June 4, the state Assembly's Agriculture Committee approved a bill previously passed by the full Senate that would put New Yorkers on a more level playing field by limiting assessment increases.

"Property taxes are a large sum of the money farmers pay because they have to have land to do the things they do," said William Magee, D-Nelson, committee chairman.

New York Farm Bureau President Dean Norton said, "It's definitely a bipartisan bill. Both sides of the aisle have seen the need for restraint when it comes to property taxes in New York."

Farm Bureau says property taxes have virtually doubled for New York's farms during the past decade, coming at a time when other farm costs are also rising such as fuel, feed, labor and health care. Such expenses weigh heavily on a farm's bottom line and discourage owners from purchasing more land to expand operations, which makes it difficult to transfer farms to younger family members.

Farm Bureau Vice President Eric Ooms is a Columbia County dairy farmer in the Hudson Valley.

"The burden my children may have to take on in the future could prevent the farm from being passed on to the next generation," he said.

Land assessments are dictated by a complicated formula that takes into account national production value statistics and soil type.

From 1990 to 2006, the average ag assessment value for a particular soil class was virtually unchanged at $550.

"For 2013, the ag assessment value for this same soil class is $1,000," said Barry Flansburg, a municipal assessor for four towns in Genesee and Orleans counties. "From my professional perspective in an area that has a strong agricultural presence, farming has evolved and modernized since the 1970s, but the ag assessment system has not. It is not reflective of what's happening in the fields today and no longer is a reasonable and consistent system."

The average $38.41 per acre that New York farmers pay in taxes is almost double the amount of some Midwestern states. For example, in Michigan, Ohio and Wisconsin the numbers are $26.97, $21.35 and $24, respectively.

Norton said he believes the full Assembly will pass the proposal before state lawmakers conclude business in late June.

"I think if we can get this through the Assembly we'll see a positive outcome from the governor's hand as well," he said.

But Magee added, "It's not going to be an easy thing. Hopefully we can get it done. Higher taxes equate to more pressure on farmers. The increasing agriculture assessments will eventually force farmers out of New York If adopted, legislation would take affect next year and be reflected in the school tax bills that property owners get in September 2014.

By state law, ag land assessments currently rise 10 percent per year, a rate established in 2006 when farmers were facing the possibility of a more than 30 percent increase, Flansburg said.

"If we hadn't made the change in 2006 we'd see a lot of farms vacant now," Norton said.

He said farmers are getting more for some crops than they were several years ago, but added that property taxes shouldn't be based on income. For example, if a regular home owner gets a new job with a big raise, their property taxes don't go up, he said.

"Just because we're getting more gross dollars doesn't mean we're making more money," he said.

A variety of other costs eat into every farm's bottom line, Norton said.

Farm Bureau is also pushing for the creation of a working group comprised of stakeholders and experts to address the long term problem of agricultural assessment valuation.

"New York farmers deserve a fair shot when it comes to selling their quality products in a competitive marketplace," Norton said.

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