Task force on agriculture tax values requests study of actual use

PIERRE — The possible effects of converting to actual use in setting taxable values for agriculture land should be studied, a state panel decided Tuesday.

South Dakota currently uses an agriculture productivity system for determining tax values. It relies on soil type, crop, yield and multiple years of crop prices.

Actual use would be a major change. It would benefit owners of land that has crop-rated soil, but has been kept in grass.

The Legislature’s task force that oversees agricultural property assessments voted 9-0 Tuesday to request $151,000 for the study.

The economics department at South Dakota State University would perform the work. The results would be due by June 30, 2016.

“That’s what we need to know, exactly how it would affect different taxpayers,” Rep. Jim Peterson, D-Revillo, said.

Sen. Larry Rhoden, the task force’s chairman, said information from a study is needed before the Legislature can be asked to consider actual use.

“I feel compelled to support it,” Rhoden, R-Union Center, said.

The task force also recommended that legislation be introduced in 2015 that would change the definition of agricultural property, but the final version is still being negotiated.

A similar attempt by Pennington County residents in the 2014 legislative session failed. It focused on small tracts of agricultural property such as timber, primarily in the Black Hills.

The task force also endorsed legislation for 2015 that would remove some obsolete references and update other pieces of agricultural property tax laws.

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