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This is the time of year when farmers and ranchers are receiving the valuations on their parcels of agricultural and horticultural lands. While most of these valuations have been fair and accurate, some have not been. This week I received numerous phone calls from agricultural landowners all across the state complaining about how their valuations rose astronomically this year. Worse yet, these landowners reported to me how the rise in their valuation was due to LB372, a bill I introduced in 2019. So, today I would like to address the concerns of these landowners and set the record straight.
LB372 was designed to correct the way the Property Assessment Division had been assessing grassland. Prior to LB372 all agricultural land was being assessed by dryland criteria. LB372 required the Property Assessment Division to begin using grassland specific data from the Natural Resources Conservation Service (NRCS) as their primary source for assessing grassland.
LB372 corrected an already known and established error in the way the Property Assessment Division had been assessing grassland. I call it a “known error” because twice the Tax Equalization & Review Commission had recognized the Property Assessment Division’s method as an erroneous.
To illustrate this error, consider how the Property Assessment Division had been assessing grassland in the Sandhills. The Sandhills is important because it comprises approximately one quarter of the land mass in Nebraska and about half of all the pasture land in the state. The Property Assessment Division had been assessing all parcels of grassland with dryland cropland criteria, even though those particular soils could not hold crops. Had they used the appropriate data from the NRCS, the soil classifications for those parcels of land would have been based upon forage production instead, making the method much more fair and accurate.
County assessors should welcome this change as it will help to bring their appraisal process into compliance with the law. Applying a dryland farming criteria to grassland is something no reputable appraiser would ever do as it is unacceptable.
This year the Property Assessment Division began implementing the method prescribed in LB372. Although the Property Assessment Division has gone through great lengths to train the assessors in how to use the NRCS data correctly, many discrepancies have already been found.
Before I contacted the Property Assessment Division about these problems, I set out to see for myself if assessments were being done correctly. Consequently, I asked my own expert to reassess a certain parcel of agricultural land where the valuation had gone up $40,000 this year. Sure enough, several discrepancies were found in the way the assessor had valuated the land.
When the Property Assessment Division trained the assessors earlier this year, they explicitly told them not to use Land Capability Groupings (LCG) as the sole basis for changing agricultural land values, yet this is precisely what some assessors have been doing this year. For instance, slide number 14 in the training presentation specifically states: “Agricultural land values should not change based on LCG conversion only,” and “Analysis will be required to avoid raising agricultural values in a declining market.”
As a result of the widespread confusion surrounding this conversion issue, Ruth Sorenson, who heads up the Property Assessment Division, sent out a corrective email to the assessors in all counties. Please know that I would never introduce legislation that would adversely affect agricultural land valuations.
If you believe your land has been adversely assessed, please do not hesitate to contact my office at (402) 471-2616. You will need to file your protest and contact your county assessor before the deadline of June 30.