SALEM, Ohio – A judge’s decision to allow a Columbiana County tree farmer reduced property taxes through the Current Agricultural Use Valuation program may set a precedent for other arguments across the state.
But even if it doesn’t, tree farmer David Coldwell says the judgment makes him happier than he’s been in a long time.
Columbiana County Common Pleas Court Judge C. Ashley Pike ruled last week the Coldwells’ forested property qualifies for CAUV tax reductions denied since 2005 by the county auditor and board of revision.
History. Farm and Dairy first reported in October 2006 about the family’s plight, which Coldwell described as a ‘crisis situation.’
In August 2004, the Coldwell family purchased 98 acres of forestland that abutted their 400-acre certified tree farm.
Dave and son Jed, both consulting foresters, and another son Jared, a college student studying forestry, developed forest management plans, trimmed grapevines in their nearly 500 acres of woodlots, did timber stand improvements and tree plantings and release cuttings.
Then in early 2005, a slap in the face accompanied their property tax bill. The county auditor said they didn’t qualify for the CAUV tax reduction on the newly acquired property. Their tax bill was nearly four times what they had expected.
Auditor Nancy Milliken and the county’s board of revision said the Coldwells had a three-year wait before they could qualify for the savings.
The Coldwells, meanwhile, asserted Ohio law was on their side, and that they should qualify because of the forest management measures they took with the property.
They had a sworn affidavit from the land’s previous owner to prove the land was managed as a woodlot – often with the Coldwells’ help – for more than three years before the Coldwells bought it.
The Coldwells said it was the property and its use that qualified, not the ownership status or whose name was on the deed.
Decision. In his decision, Pike called qualifying woodlots for CAUV “traditionally problematic” and said the difficulty comes “from the fact that it may take decades for a timber crop to mature to a size and nature that can be commercially harvested.”
Pike said the Coldwells’ forest management plans showed they intended to grow timber as a crop, which would partially qualify them under state law (see related information).
Pike also went on to say the county’s board of revision “apparently based their decision to deny CAUV … on the fact that the [Coldwells] had not owned the property for the three-year waiting period.”
“Clearly, the board failed to consider the correct criteria in making its determination,” Pike said, noting the law does not mandate someone own the property for three years, nor enroll in CAUV for three years, prior to application.
Attorney Nick Barborak, who represented the county on the case, was unavailable for comment. It’s not yet clear whether the county will appeal the ruling.
Reactions. Dave Coldwell calls Pike’s decision “powerful” and his interpretation of the law “very explicit.”
“He ruled on the very same arguments we started with, that there’s not an automatic three-year wait,” Coldwell said.
At the same time, the decision is bittersweet. “We’re happy, but also disappointed we had to go this far with an auditor’s office that knew better,” Coldwell said. “We don’t think anyone should have to go through this.”
Precedent? Ohio Farm Bureau director of local affairs Larry Gearhardt said the statewide farm organization is pleased with the decision, which will help clarify the application of teeter-tottering CAUV law and real-life use statewide.
“This clarified an existing law where there wasn’t guidance before. It at least illustrates to auditors what needs to be done to prove commercial management” in a woodlot, Gearhardt said.
Prior to the Coldwell decision, most decisions to grant or deny CAUV for woodlot owners were based on a 1990 decision that merely said it takes decades for a woodlot to grow to its commercial peak, according to Gearhardt. It was difficult to prove whether a landowner was really after a tax break or was honestly growing timber.
A decision in 2006 made that law less blurry, Gearhardt said, when it was decided “you can’t sit around and do nothing [in the woodlot] and still qualify.”
Gearhardt said the woodlot CAUV issue will stay in the limelight as the state looks at combining forest tax laws with CAUV.
“The best thing to do is get a forest management plan. And follow it,” Gearhardt said.
Principle. Coldwell said he paid only what he believed he owed since the 2005 taxation question. Because he has paid a lower amount than billed, he’s not due any refund.
“It’s the whole principle of it. More landowners need to take a stand when something’s not right.”
(Reporter Andrea Myers welcomes feedback by phone at 800-837-3419 or by e-mail at email@example.com.)
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