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Leflore County Farm Land Property Taxes Skyrocket - Here's Why

Tuesday, September 3, 2019, 4:38 pm News Flash Archive

Baird Moor has watched as the property taxes on his family's farm more than doubled over the past nine years.

In January 2011, the Moor family paid $4374 in property taxes.

Next January, they will be required to pay $11,272. That's an increase of 158% in nine years.

Needless to say, Mr. Moor is not happy. He has attended the various tax hearings held by the school board and the Board of Supervisors. But as is always the case, the school board and supervisors never provide any relief for farmers like Mr. Moor. And the taxes just keep going up and up and up.

To confirm these figures, The Taxpayers Channel obtained and analyzed nine years' worth of tax receipts for the 11 parcels that make up the farm, which has been in the Moor family for several generations. Their land lies on the western bank of the Yazoo River, south of the old Florewood State Park.

During the nine year period from 2010 through 2019, there have been no improvements made and no new buildings erected that could explain the huge increase in taxes owed.

Instead, the tax increase of 158% on the family farm is the result of dramatic increases in the "assessed value" of the property, coupled with a substantial increase in local property tax rates, or "millage."

Since 2010, the Supervisors have raised the county tax millage rate from 67.70 mills to 69.54 mills, a 3% increase over 9 years.

In the same period of time, the school tax millage rate has jumped from 34.25 mills to 44.12 mills, a 29% increase.

Initially, taxpayers were assured that, with this year's consolidation of the Greenwood Public Schools with the Leflore County Public Schools, there would be substantial cost savings.

But in a cruel turn of events, during the process of converting the school tax millage rates for the two districts into a combined single millage rate for the entire county, the rate paid by county landowners spiked upwards, while the rate paid by Greenwood taxpayers was substantially lowered, so that both city and county taxpayers now pay the same school millage rate.

Needless to say, the promised substantial cost savings never showed up.

Overall, the property tax millage rate for farm land in Leflore County has increased 11.5% in the past nine years.

On top of that, the "assessed value" of the Moor family farm property increased by 111% in the same period of time. The "assessed value" is generally 15% of the "appraised value," and is the value upon which taxes are levied. When the "assessed value" rises, so do property taxes, even if the millage rate stays the same.

By law, Tax Assessor Leroy Ware has no discretion in calculating the assessed value of farm land. Farm land is not appraised for tax purposes based on "fair market value," as would be the case for residential and most commercial properties. Rather, the "net return per acre," or roughly speaking, the profit that can be made from growing crops on the land, is used to derive an "assessed value" per acre, which is then taxed.

These property "assessed value" figures are not determined by appraising each piece of property individually at the county level. Instead, the values are handed down from on high by the Mississippi Department of Revenue in Jackson each year. The MDOR, in turn, receives the numbers from Mississippi State University agricultural economists.

The MSU economists track commodity prices, costs of production, and other figures, and calculate the average "net return" per acre of farm land. The figures are broken down into regions - Leflore County falls in the "Upper Delta" farm region - and then further into a set of ten different soil quality classifications.

The "soil quality" assignments to each parcel of land, likewise, are not under the local tax assessor's control. Instead, they are determined by satellite and land surveys performed by the USDA's National Resources Conservation Service (NRCS).

The higher the "soil quality" assigned to a given parcel of land, the higher the average "net return" value will be assigned to that same parcel, which in turn means the higher the "assessed value" will be for that particular parcel.

The "assessed value" of a particular parcel depends on the soil quality classification assigned to the parcel by the federal government, and the "net return" value assigned by the state for that given soil quality. Both of these figures are based upon "mass appraisals" taken over a large area, and are set by the state and federal governments, not by local county officials.

High and medium quality cultivatable land "assessed values" for all farmland in Leflore County rose by 10% every year since 2010 until 2018 and 2019, when they rose 4% each year. That means that, even if the tax millage rate had been held steady, property taxes on quality farm land would have increased 111% from 2010 through 2019, because the "assessed value" of the land went up by 111%.

On top of these inexorable increases, the NRCS began a new soil survey in 2011, and in 2013, many acres of the Moor family farm were upgraded from Class II to Class I in soil quality, resulting in an additional single year jump of 17% in assessed value for the whole farm, on top of the regular 10% increase for that year.

And the Moor family's plight is not unique. Almost all cultivatable farm land in Leflore County has endured a similar doubling or more in "assessed value" and property taxes the past nine years.

Theoretically, when farming a piece of property becomes more profitable, the "assessed value" per acre should rise, and so will the property taxes. Conversely, if farm prices and profits fall, the "assessed value" per acre should fall, as should the property taxes. There is a certain "lag time" built into the land valuations, and a rolling three-year average is used to smooth out fluctuations.

But farmers like Mr. Moor point out that, while commodity prices have actually fallen over the past decade after spiking in 2011, there is no sign of a turnaround in the runaway increase in "assessed values" for cultivated agricultural land.

The legislature has capped the allowable increase in "assessed value" for farmland to 4% per year starting in 2018. In both 2018 and 2019, the "assessed values" increased by the full 4% allowed by the cap.

In January 2020, farmers will find out whether they'll be hit with an additional 4% increase in property "assessed values" and taxes for next year.

The only relief for farmers like Baird Moor would be dramatic cuts by local officials in the property tax millage rates, or for the state legislature to overhaul the method of assessing farm land for tax purposes.

But both of these remedies would result in a reduction in tax revenue to local governments, and that seems very unlikely to occur.

John Pittman Hey
The Taxpayers Channel

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