STATE PROPOSES FARM TAX HIKES

JACKSON -- Missouri farmers would see their property tax assessments go up as much as 17 percent under a proposal by the State Tax Commission.

Delegates to the Missouri Farm Bureau's annual meeting Tuesday voted to oppose the proposal.

In Cape Girardeau County, property taxes on 91 percent of all agricultural land would be increased. If approved, the change would take effect Jan. 1, 1999.

The Missouri Legislature has 60 days from beginning of the next session to oppose the increase. If it doesn't, the changes go into effect.

Estil Fretwell, lobbyist with the Missouri Farm Bureau, said his organization would like to see legislation introduced to block the increase. "We will be supporting that," he said.

The Tax Commission's proposal for farmland is similar to reassessment of residential and commercial property, said Bruce Davis, commissioner with the State Tax Commission.

Agricultural land in Missouri is assessed based on its productive value. It is assessed in eight categories based on soil quality. Residential and commercial property, on the other hand, is assessed based on the market value of the land.

Fretwell said Missouri Farm Bureau delegates are opposed to the size of the proposed increase. Assessed valuations of most soil grades would increase 12 and 13 percent. Assessed valuation of grade 7 soil would increase 17 percent.

"Look at agriculture," Fretwell said. "It is a very capital-intensive business. Look at the land and buildings a farmer must own or have in order to do business."

Property taxes long have been a concern for farmers, he said.

"The concerns about the new recommendations again go back to the issue the size of the increase," Fretwell said.

Davis said the proposed increase was calculated using such things as the average rate of return on cropland and interest rates.

Calculations are done every two years, he said.

"There are years where the calculations are done, and if there is not much change the commission can make the decision not to recommend a change," Davis said.

The Legislature rejected a proposed increase in 1987. In 1995, an increase was approved.

Of Cape Girardeau County's 368,500 acres, 333,770 acres are classified as agricultural, said Jerry Reynolds, the county assessor.

"The tax is based on productivity, then it's assessed at 12 percent of the value," Reynolds said.

For example, Missouri's best farmland has a productive value of $985 an acre. When assessed at 12 percent, 100 acres would have an assessed valuation of $11,820.

The proposed increase would increase the assessed valuation of that same 100 acres to $13,380.

Property taxes are billed based on assessed valuations.

Cape Girardeau County has very little grade 1 farmland. That best soil is found in the Delta area.

Upland pastures fall into grades 3 and 4. An abandoned quarry or other similar land could fall into grade 8.