Landowners sue Ohio over CAUV calculation

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(Farm and Dairy file photo)

SALEM, Ohio — A group of Ohio farmers and landowners who are upset over two- and three-fold increases in their real estate property taxes have filed a lawsuit against the state, seeking more than $1 billion they claim was illegally collected through increases to the state’s Current Agricultural Use Value.

The case was filed June 26 in the Ashtabula County Court of Common Pleas, by co-attorneys  Kevin Roberts, of the Roberts Law Firm in Olmsted Falls, and Benjamin Calkins, of the Calkins Law Firm in Chagrin Falls.

The case lists four primary plaintiffs, Bruce A. Vance, of Jefferson, Ohio; G. Frederick Pierce-Ruhland, of Kingsville; Joseph K. Blystone Trust, of Canal Winchester; and Bruce Achor, of Clinton County.

Related: See the full complaint here.

Attorneys for the case are hoping to get it certified as a class action, to include more than 100,000 property owners who were taxed over the last 10 years.

The CAUV was established in 1975 as a means of taxing farmland on its agricultural use value and not its full market value.

Crop commodities

Roberts said the biggest issue is that the state determined CAUV values based on crop commodities — like corn, soybeans and wheat — and neglected to take into consideration acres that grow other crops, such as grapes, woodlands or pastureland, or are not suited to grow crops.

“Basically they used the rise in commodity prices as an excuse for the fact that they changed other parts,” he said.

Farm and Dairy contacted the Ohio Department of Taxation, which was still in the process of reviewing the suit and could not comment.

According to the suit, the Ohio Department of Taxation’s collection from CAUV has increased 374 percent from 2005 to 2013, going from $1.817 billion to $6.804 billion in 2013.

Class action

Calkins, who owns 52 acres in Geauga County, said he was contacted by upset farmers following the state’s most recent assessment of CAUV taxes.

The farmers were seeing increases in their tax rates, and “felt that the law was not being applied as it was written,” Calkins said.

Specifically, the plaintiffs argue that Ohio’s CAUV law requires rates to be determined according to different “land use patterns,” which include livestock, timberland and pastureland, in addition to “cropping.”

Instead, the plaintiffs allege that the state CAUV prices “are driven by the economic conditions of farming corn, beans and wheat. All other means and methods of agricultural production, all other ‘land uses,’ are ignored in violation of the CAUV law and regulations.”

The Ohio Department of Taxation’s website contains a document called Explanation of the values …, which affords two exceptions to the corn, bean and wheat calculation.

First, soil map units with a productivity index of 55 or less “are assumed to be most profitably used as pasture,” according to the document, and have a minimum value in 2015 of $350.

Secondly, a value of 50 percent corn and 50 percent soybeans is used to calculate organic soils.

Rob Nichols, press secretary for Gov. John Kasich, said his office “does not comment” on litigation.

Land use classes

The lawsuit argues there are eight different land use classes that should have been used to assess taxes, four that are suitable for crop production, and four classes that are suitable for permanent vegetation.

It further argues that land deemed “unsuitable for crop production” should have a crop return of zero, and a taxation of zero.

More allegations

The suit also alleges that the state has “taken shortcuts, carefully selected minimal data, imposed illegal minimum property values, and performed calculations with a view to falsely inflate CAUV.”

Regarding woodlands, which are taxed at the value the land would have as cropland (minus the cost to clear and convert it to cropland), the lawsuit claims the credit for clearing was inappropriately kept low for decades.

Long process

Both attorneys expect the plaintiffs will grow in number as the case continues, something Calkins said could potentially take years to resolve.

Calkins said he expects a strong defense from the state.

“They will say they did everything properly, I’m sure,” Calkins said. “If we thought that, we would have never (filed this).”

Roberts said he hopes the case will be certified as a class action in less than a year.

“This is the kind of situation for which the class certification laws were drafted and enacted,” he said.

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6 COMMENTS

  1. When I complained to my local tax agency about the farm taxes they reworked it and lowered them slightly but then raised the value of my residence in the same tax year.

  2. Thank you Farm and Dairy for your reports on CAUV tax issues. Readers can press the link in this article to download it.
    We hope Ohio legislators, Ohio Farm Bureau, Ohio Farmers Union, Ohio Forestry Association and Ohio Department of Natural Resources will be able to use some of the language in the suit in their continuing efforts to assist farmers and woodland owners.
    I want everyone to know we individual landowners and landowners in groups such as the Ashtabula CAUV Task Force have spent 1000’s of hours to try to identify the problems and recommend solutions to ODT. I am proud we behaved ourselves even though some would have wanted to protest in Columbus with tractors, pitch forks and manure. All of us have to admit there has been no success in getting our money back or getting relief any time soon. Since there is no other type of recourse, many of us felt we had to go to this next Class Action step.

  3. Mine went up 50% and I thought that was the increase and found out they are likely to double again. I’m at the highest CAUV rate I found from someone doing a survey for some sort of GPS investigation for alternative crops, and I lost money the last couple years.

  4. Mine in Knox county went from $5300 to $13,000 on 370 acres with only 170 in current crop production .
    75 is Forested and the other 125 in conservation programs to save soil and improve water quality.
    My letters to the Ohio senate/house and tax department got no responses
    I should pull out all the conservation lands and farm them so the water problems for ALL Ohioans increases ten fold like Toledos water supply.

    I talked to the County auditor-they said the Dept of Taxation sets rates-The D of tax said the Legislator set the rates the -legislators said D OF T gives the rates — Its a dog chasing its tail.No one is in charge but the money keeps coming in to someone from the landowners.

    • Hello Steve: You sound like you can make a real contribution to the Class Action Case. Would you please email our attorney KTR@KevinRobertsLaw.com. Thanks and I hope we can meet someday because we are all in the same boat. Fred

    • Steve, If you haven’t already you should ask your county auditor office for the list of your soil types and their classification to fully understand how much and which acres are taxed. Some auditors have allowed acres in the conservation program to be classified as waste acres netting them a 0 value. They will need to verify this with the local soil and water office.

      It is true the state determines the taxable value for each soil type. and provides that to the county auditors. The auditor cannot modify those values and must apply them to the corresponding soil types on your operation. Adjustments are made whether those acres on your farm are used to woodland, cropland, or pasture. Verify that the county is using the appropriate splits. There is also a category for waste. That includes roads, bridges, and right of ways that penetrate your acres. Ponds and streams should also be qualified as waste.

      I am a farmer too that has been lobbying for changes to the formula. Call me if you have any questions. 937-837-6401

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