As in many states, Nebraska farmers and ranchers have seen some big jumps in their property taxes this year.
The assessed value of ag land in Nebraska increased by about 12 percent statewide from 2009 to 2010. In some cases, valuation increases exceeded 30 percent from last year. Nebraska Farm Bureau president Keith Olsen believes it’s time for the state to change from a market-based formula to an income-based approach.
“All of the surrounding states use the income approach, but we still use the market approach,” Olsen says. “We’ve had policy for a number of years to go to some type of income approach and I hope we are able to continue that policy—and then work with our legislators to come up with a system that will work for Nebraska.”
Nebraska Farm Bureau vice president of governmental relations Jay Rempe says under the current market-based system, land purchased for 1031 exchanges, or for hunting and recreational purposes, is not being filtered out.
“That’s where an income-based approach would maybe filter out some of those other influences and just focus, basically, on the land’s productivity and its value as an ag-based asset,” says Rempe.
But Rempe says if an income-based approach is not feasible, Farm Bureau will seek changes to the market-based formula, including a lowering of the current 75 percent of the market level of value.