Washington grazing

Cows graze in southwest Washington. The state's assessors want to change the criteria for taxing agricultural land.

CENTERVILLE, Wash. — The Washington Association of County Officials is proposing a change in agricultural property tax exemption that violates the intent of state law and threatens the viability of farming, a Klickitat County farmer says.

The association’s priorities for the upcoming 2020 legislative session include “resolving inequities in agricultural property tax exemptions by adding an income requirement of $4,000 for properties 20 acres and above.”

“A lot of Klickitat County range and crop land can’t meet that requirement because it’s assessed per tax parcel, so it will force a lot of people out of the agricultural current use program,” said Dave West, 61, a Centerville hay and cattle producer and vice president of the Klickitat-Yakima County Farm Bureau.

Agricultural land use will be threatened, which violates the intent of the state law allowing agricultural property tax exemptions to protect and maintain farmland, West said.

Current law requires owners of land under 20 acres to be able to show gross agricultural income of $1,000 per 5 acres to qualify for agricultural designation and an exemption from full market value assessed valuation for taxation. Owners of land over 20 acres only have to show some income with no minimum.

Jennifer Wallace, executive director of the Washington Association of County Officials, said the association goal isn’t to drive people out of the program but ensure a stronger one. She said integrity and equity of the program is “really important” because it represents a shift in taxes to non-exempt properties.

It doesn’t make sense, she said, that minimum agricultural income has to be shown under 20 acres but not above and that “owners of 21-plus acres active in agriculture will have no problem proving the minimum level of income.”

One might think demonstration of minimum income is not needed for large holdings, but county assessors see abuse by large property owners claiming grazing land with no fence or cattle and claims of beekeeping without any hives, she said.

“Demonstrated income would provide a straight-forward mechanism for ensuring those that receive the exemption are operating consistent with legislative intent,” Wallace said.

West said it’s apparent Wallace has no knowledge of dryland agriculture. He said he has served on a county advisory committee setting rental rates used to determine assessed values for the agricultural use program and cannot think of a single dryland 20-acre parcel that could meet the $4,000 annual gross income requirement.

“I wish we could expect to gross $200 per acre per year on dry crop ground. The highest grossing crop is not always the highest net return,” West said.

He said range land rents for as low as $1 per acre so even if parcels were allowed to be combined it would take 4,000 acres to meet the income requirement.

He said he farms more than 1,000 acres in 14 different tax parcels with the smallest being 80 acres.

“All of the parcels legitimately in agricultural production create as much income as they are capable of producing and seven would not be able to pass the proposed income test,” he said.

There are abuses of the system but they can be remedied by assessor audits and enforcement of current law, he said.

If equity is a goal, the minimum on small acreage should be dropped and requirements to document production should be reinforced, he said.

Narrow profit margins and high cost of increased taxes will force people to sell land and developers will be the main buyers, West said.

He said wheat growers and the state Farm Bureau are aware of the proposal and will be opposed.

“I can’t imagine any agricultural group not opposed,” he said. “If the association were to get this passed, there is no reason to believe they would not want to expand to a minimum income per acre regardless of parcel size.”

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