November 13, 2018
Nebraska Gov. Pete Ricketts is considering a proposal that would change the way agricultural land is taxed to provide relief to farmers who are struggling amid low crop prices.The governor floated the idea last week as a way to prevent property taxes from sharply increasing even as the state’s agricultural economy is having troubles. A similar bill stalled in the Legislature in 2017, but Ricketts said he doesn’t think it was fully debated or understood.“I still think it’s a good idea,” Ricketts said in an Associated Press interview. “People have had a chance to think about it and look at it, and I think that gives us more of an opportunity to get that passed.”Nebraska now relies on a market-based system when valuing agricultural land, unlike most Midwestern states that levy based on the potential income a property can generate. Iowa, Illinois, Indiana, Kansas, Ohio, Wisconsin and the Dakotas all use the latter and typically charge less in agricultural property taxes than Nebraska.Under Nebraska’s system, farmland is assessed based on the market price of nearby land parcels that have recently been sold. Investors in recent years have bought such land at a premium, raising property values for the surrounding area even when commodity prices have fallen. The soaring land values result in higher taxes.
