Ohio Administrative Code › Title 5703 - Department of Taxation › Chapter 5703-25 - Equalization - Appraisals › Section 5703-25-33 - Current agricultural use value of land table or tables

Current through all regulations passed and filed through July 1, 2024
(A) The annual
			 "Current Agricultural Use Value Of Land Table Or Tables" to be prescribed by
			 the tax commissioner shall be calculated and prepared by the capitalization of
			 the typical net income before real property and income taxes from agricultural
			 products assuming typical management, cropping and land use patterns and yields
			 for a given type of soil, as provided in this rule.
(B) The use of the income approach to develop
			 annual "Current Agricultural Use Value of Land Table Or Tables" that are
			 accurate, reliable and practical requires that careful attention be given to
			 the many principles and techniques involved. It is essential that the typical
			 or potential net income be based on the land capability under normal or typical
			 management practices, yields, cropping or land use patterns, prices, costs and
			 conditions in the area rather than the management ability or decisions of an
			 individual owner or operator. To avoid erratic fluctuations of value due to
			 spot economic, market or climatic conditions, five year moving averages of
			 price costs, cropping patterns and other factors shall be used where practical.
			 In addition, the effect of changes in agricultural technology and economic
			 relationships must constantly be revaluated. The agricultural advisory
			 committee shall function to keep the commissioner informed of such
			 technological and economic changes.
(C) The most critical determination is the
			 capitalization rate. This rate shall be determined by comparison of net income,
			 calculated as described in this rule, to known prices or market value
			 appraisals of farms that have been sold or appraised under the conditions
			 prescribed by the definition of "Current Agricultural Use Value of Land" in
			 rule
			 5703-25-30 of the
			 Administrative Code. The synthesis of the capitalization rate by other than
			 market data shall be by a method that gives weight to the factors present in
			 the market for such property.
(D)
			 Information shall be obtained from such agencies as cooperative extension
			 service, college of agriculture, the Ohio state university; Ohio agricultural
			 research and development center; national resources conservation services,
			 U.S.D.A.; forest service, U.S.D.A.; national agricultural statistical service,
			 U.S.D.A.; department of agriculture of Ohio; department of natural resources of
			 Ohio, federal land bank and other reliable sources.
(E) In the absence of crop yield information
			 for any soil mapping unit present in Ohio, the tax commissioner shall, in
			 consultation with the department of natural resources of Ohio, determine the
			 appropriate crop yield and soil productivity information for that mapping unit.
(F) Land capability classes:
			 Consideration shall be given to the land capability class of a soil as
			 determined by the soil conservation service based on the soils suitability to
			 grow various crops and potential hazards considering slope, drainage, erosion
			 and other factors. The typical land capability class for a soil management
			 group shall be determined and this class shall serve as a base for calculation
			 of values when the soils in a group fall in other than typical land capability
			 class. Usually the typical class for which the base value for a soil management
			 group is calculated will be the class with the least hazard for the group.
The major land capability classes are as follows:
(1) Land adapted for crops:
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Class I No special hazards, very good land from every
				standpoint.
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Class II Some hazards which require good conservation
				practices.
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Class III Several intensive hazards which require intensive
				conservation practices.
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Class IV Very severe hazards, needs very careful handling and
				management.
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(2) Land for permanent
			 vegetation only:
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Class V Very frequent flooding or permanently wet.
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Class VI Moderate hazards to be overcome for pasture use.
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Class VII Severe limitations for grazing or forestry, very
				steep.
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Class VIII Not suited for cultivation, pasture or forests.
				Wildlife and recreation is the best use.
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