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Introduction. This is a meeting before the Ohio Department of Taxation, May 7, 2010. We will be presenting data on the proposed tax year 2010 Current Agricultural Use Values.. Agenda . Updates to the model for 2010Yield updatesCrop pricesCost of inputsCapitalization rateCalculation of soil values.
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1. Advisory Committee for the TY 2010 Current Agricultural Use Values Public Hearing
Agricultural Advisory Committee
May 7, 2010
Tax Equalization Division
Ohio Department of Taxation
2. Introduction This is a meeting before the Ohio Department of Taxation, May 7, 2010. We will be presenting data on the proposed tax year 2010 Current Agricultural Use Values.
3. Agenda Updates to the model for 2010
Yield updates
Crop prices
Cost of inputs
Capitalization rate
Calculation of soil values
4. Model Updates for 2010 Single crop pattern
Based on most recent five year average of acres harvested
Corn 39%
Soybeans 51%
Wheat 10%
Eliminate hay
Maintain 50% corn and 50% soybeans for organic and frequently flooded soils
5. Acres Harvested, 2004-2008
6. Model Updates for 2010 Elimination of hay
Previously used two hay crops, mixed hay and grass hay
Most produced for private use
Lack of a consistent and reliable source for hay prices
Produces more uniform values according to slope and productivity index
7. Crop Yield Updates for 2010 Continue to update crop yields annually; began in TY 2006
Crop yields reported by the Ohio Agricultural Statistics Service for the past 10 years are averaged
That average is divided by the original yields published in 1984
The resulting factor is applied to the yields of record for each soil type
8. Yield Updates for TY 2010 For 2010, the factor is based upon yield data from 1999-2008
Soil yields from 1984 were increased by the following percentages
Corn: 18.73%
Soybeans: 12.88%
Wheat: 52.50%
9. Yield Updates for 2010 The yield update increases the corn yield for Miami Silt Loam, a soil with average productivity, from 108 to 128 bushels per acre.
By contrast, the average corn yield for all soil types in 2007 was 150 bushels per acre.
10. CROP PRICES ____________________
13. Crop Prices 2007, 2009 & 2010
14. COST of INPUTS ____________________
15. Non-Land Production CostsBase Unit, TY 2007, 2009 & 2010
16. Non-Land Production CostsAdded Unit, 2007, 2009 & 2010
17. CAPITALIZATION RATE _____________________________
18. Capitalization RateTY 2007-2010 2007 2010
Mortgage/Equity Ratio 60/40 60/40
Years 15 15
Interest Rate 7.49 7.09
Equity Rate 8.35 7.45
Tax Additur 1.4 1.4
Capitalization Rate 8.4% 7.8%
19. Capitalization RateTY 2009-2010 2009 2010
Mortgage/Equity Ratio 60/40 60/40
Years 15 15
Interest Rate 7.06 7.09
Equity Rate 7.65 7.45
Tax Additur 1.4 1.4
Capitalization Rate 7.9% 7.8%
20. Calculation of Soil ValuesComparison of Values
22. 2010 Sample Calculation
23. 2007 Sample Calculation
24. 2010 Sample Calculation
25. Average CAUV Values 2003-2010
26. Average CAUV Values by Reappraisal Cycle
27. Conclusion Comments or questions.