COLUMBUS, Ohio — On Tuesday, Theodore O. Finnarn, Greenville attorney and Ohio Farmers Union (OFU) representative offered support for a bill in the Ohio House to update and clarify computations of the Current Agricultural Use Valuation (CAUV) law, that will help Ohio farmers stay on their land and preserve and protect “conservation” acres in Ohio.
Finnarn spoke before the House’s Agricultural and Rural Development Committee, telling members that he and OFU members support House Bill 398, which would improve the formula for determining CAUV values for real property taxation in Ohio.
According to Finnarn, a longtime member of the Ag Advisory Committee to the Ohio Department of Taxation, “this much needed legislation clarifies and better defines the factors used to determine the capitalization-interest rate component used in our CAUV calculations.”
Recently, CAUV values for rural property owners have sky-rocketed tremendously with increases as high as 200 to 300 percent, leading to a heavy and unwarranted tax burden switch onto the backs of Ohio farmers.
With this modification of the capitalization rate, Finnarn noted, “We will achieve CAUV values that are closer to the actual income-producing ability of Ohio farmland and thus realize the original purpose and policy of the CAUV law, which is to allow farmland owners to pay reasonable real estate taxes based on a farm’s ‘use’ rather than its speculative fair market value.”
The bill (which has companion legislation in the Ohio Senate — Senate Bill 246) also provides that CAUV land used in a conservation practice, either state or federal program, would be valued at the lowest value assigned on the basis of soil type. This requirement would encourage farmers to engage in practices that protect the environment and water quality.
Currently, under the CAUV rules, farmers are discouraged from participating in these programs because the farmland is taxed as though it is producing crops. The legislation would provide that conservation acres under CAUV would be valued at the minimum values used in the formula which would be appropriate because these lands are not producing any crops or income.
The OFU led the effort to adopt the CAUV constitutional amendment in the fall of 1973 and has been instrumental in the development of the CAUV law. Finnarn, representing the OFU, has been on the CAUV Ag Advisory Committee to the Division of Tax Equalization, Department of Taxation since its beginning in 1976 and helped to put together the original CAUV law and regulations. He is sometimes referred to as “Mr. CAUV.”
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