I just learned that Sen. Delph has introduced two bills addressing the situation with “agricultural” land being reclassified as “excess residential”. Both of these bills appear to better solve this situation than SB 436.
The first bill is SB 376:
Provides that if a taxpayer’s land is classified as agricultural land at the time of the taxpayer’s acquisition of the land, the land is presumed to be agricultural land as long as the taxpayer uses the land in the same manner as the person from whom the taxpayer acquired the land. Provides that agricultural land may not be reclassified as excess residential land without notice and, upon the request of a taxpayer, provides a hearing before the county property tax assessment board of appeals.
and the second bill is SB 558:
Specifies the criteria for classifying land as agricultural land for property tax assessment purposes. Provides that certain undeveloped lands must be assessed as agricultural land regardless of the motives of the owner at the time the owner acquired the land, the zoning designation of the land, or whether the owner uses the land for growing crops or raising livestock or is otherwise engaged in the business of farming. Requires assessing officials to review for compliance with the new criteria the assessments of lands that had been classified as excess residential property for the 2005 through 2015 assessment dates and to reclassify as agricultural land as necessary for the 2016 assessment date. Authorizes refunds for excessive tax payments attributable to the reclassification of land during that period. Provides that the limitations on contracts for the discovery of undervalued or omitted property apply to a contract concerning the reclassification of parcels, including the prohibition on contracts paid on a percentage basis.
In particular, SB 558 goes a long way towards defining what exactly “agricultural” and “excess residential” property are for tax purposes. Agricultural land is (SECTION 2. IC 6-1.1-4.5):
Sec. 2. As used in this chapter, “agricultural land” means any of the following:
(1) Land ordinarily used for growing crops.
(2) Land ordinarily used for raising livestock or poultry.
(3) Undeveloped land that must be assessed as agricultural land under section 6 of this chapter.
(4) Undeveloped land that must be assessed as agricultural land under IC 6-1.1-4-12.
and “livestock” and “poultry” are further defined as:
Sec. 4. As used in this chapter, “livestock” means the following: (1) Cattle.
(2) Sheep.
(3) Swine.
(4) Goats.
(5) Bison.
(6) Farm-raised cervidae.
(7) Horses.
(8) Mules.
(9) Other equine.Sec. 5. As used in this chapter, “poultry” means domesticated fowl, including the following:
(1) Chickens.
(2) Turkeys.
(3) Ostriches.
(4) Emus.
(5) Rheas.
(6) Cassowaries.
(7) Waterfowl.
(8) Game birds.The term does not include doves and pigeons.
Note that “Horses” and “Other equine” are specifically defined as “livestock”.
SB 558 also specifies what is considered “undeveloped land”, that granting of an easement does not constitute a change in use of the land and that land may lay fallow and still be considered “agricultural”:
Sec. 6. (a) An undeveloped land that is adjacent to a pond, lake, river, or stream, an undeveloped woodland, wetland, field, thicket, or ravine, or any similar undeveloped land must be assessed as agricultural land regardless of:
(1) the motives of the owner at the time the owner acquired the land;
(2) the zoning designation of the land; or
(3) whether the owner:(A) uses the land for growing crops or raising livestock or poultry; or
(B) is otherwise engaged in the business of farming.(b) Granting an easement for the passage of:
(1) pipelines or other underground utilities; or
(2) overhead electric and telecommunication lines;through land described in subsection (a) may not be considered a change in the use of the land.
Sec. 7. A landowner’s decision not to grow crops or raise livestock on the landowner’s land in a particular year may not be considered a change in the use of the land.
Both these bills specifically state that “agricultural” land may not be reclassified as “excess residential” unless the use of the land has changed (e.g., sub-divided into lots). It seems to me that our legislators should be encouraged to support these bills or to include language similar to that in these bills to whatever bill is drafted to address property taxation.
