Wichita — Kansas farmers will notice significantly higher property tax values on their farmland when they open their assessment notices this month, the Kansas Department of Revenue said.
The average increase in agricultural land values across the state is 7.5 percent above last year. Dryland in some areas will increase even more, the department said.
Dighton rancher Don Hineman already has gotten his assessment, showing about a 7 percent increase.
"If that was the only increase we were looking at, I'd think we'd be able to stand it OK," Hineman said.
But that is compounded because farmers are looking at drastically higher utility, fuel and fertilizer costs: "You put all those together, and it is going to add up," he said.
Higher taxable value assessments signal higher property taxes if the mill levy stays the same or increases.
In Kansas, agriculture land is assessed at its use value, rather than its market value. That means assessors factor in the land's potential for productivity when they figure taxable values.
"We do support the concept of use value over market value and part of the reasons this is in state law is because KLA and other ag groups lobbied for it back in the 1970s and 1980s," said Dee Likes, executive vice president of the Kansas Livestock Assn.
An eight-year average of productivity and income is used to determine each year's land values. The formula considers such things as interest rates, yields and crop prices.
This year's formula used figures from 1992 to 1999.
"The farm economy was a little better then than it is now," said Scott Holeman, spokesman for the Department of Revenue.
Basing farmland valuations on its use rather than generally higher market values is a preferential assessment and a benefit to farmers, Holeman said.
What is driving the higher valuations is the fact that crop yields have increased dramatically in the past few years, Likes said.
Another factor driving up valuations is that the formula is tied to the interest rates charged by the farm credit system. When interest rates go down as they have dramatically in the past few years the taxable values of farmland in Kansas rises, Likes said.
County appraisers will be mailing the change of valuation notices by April 2.
"We know this is a hard time for farmers to get this kind of information, and we are sympathetic to that, but the way agricultural values are set is determined by a formula that is in place and we are following that formula," Holeman said.
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