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Escalating land prices lead to higher valuations PDF Print E-mail
Written by Wauneta Breeze   
Friday, 20 September 2013 17:12

Ag land assessed values

increased 22 percent during

the past year


By Russ Pankonin

The Imperial Republican


■ Editor’s Note: This is the first of two stories examining the assessed valuation of ag land in Chase County and what rising valuation means in determining local tax levies.

With farm ground in and around Chase County selling at record prices, it shouldn’t come as any surprise that the tax valuations for that ground has increased accordingly.

In Nebraska, state statute allows county assessors to value ag land in a range for 69-75 percent of market value.

That legislation came about pre-2010 to help reduce some of the tax burden to ag land owners.

While that gave ag land owners some break, the rising prices being paid for land have erased much of that advantage.

Chase County ag land owners can thank the County Assessor for keeping assessed valuations closer to 69 percent of market value versus the maximum of 75 percent.

Sales of properties in the county are used to help determine what the tax valuation of the land should be.

Chase County maintains an active market for ag land, generating sufficient sales each year to allow Bartels to assess the county on local sales.

She said she’s been challenged by state taxing authorities that valuations should be higher. However, Bartels told them she wouldn’t waiver because she had sufficient sales data to back up her valuations.

Her decisions have been validated by the Nebraska Tax Equalization and Review Commission, by not calling her to show just cause why she set valuations at the levels she did.


Five-year values up 48 percent

Over the last five years, the value of ag land has increased 48.26 percent in Chase County, dating back to 2009.

In 2009, values shot up at a rate of 9.75 percent from the previous year.

The rate of increase slowed in 2010 to 4.05 percent but jumped again in 2011.

In 2011, the county recorded double-digit gains in ag land valuation. That rise in land prices was spurred by rising prices for corn and wheat.

With farmers experiencing some of the best financial conditions in more than two decades, they reinvested in what they know best—farm ground.

In 2012, the rise fell back to low single digits, with an increase of 4.8 percent noted.


2013 values up 22 percent

The biggest jump in valuations since 2009 came in 2013 values, which were based on sales occurring in 2012.

The assessed value of irrigated ag land in 2012 stood at $1,500 per acre. With an active market in 2012, that value jumped to $2,100 in assessed valuation.

That represented an increase of 40 percent for irrigated ag land. However, when combined with all other types of ag land, the county valuation increased 22.21 percent.

With assessed value of $2,100 per acre, representing just 69 percent of market value, actual market value of irrigated land in 2012 was more than $3,000 per acre.

Bartels said land owners should expect an increase in valuations again next year. She said the price of irrigated land being sold in 2013 is coming in at $5,000 an acre or more.

At 69 percent of market value, that would represent an assessed valuation of $3,450 next year.

The only thing that will turn that around is if sales prices on ag land come down instead of increasing.


Valuations and taxes

In the next story, readers will learn how the assessed valuations are used to determine the amount of property taxes they pay.

All governmental entities must have their tax requests in to the county clerk by Friday, Sept. 20. The clerk has until Oct. 15 to set the tax levies for each taxing district in the county.