Valuation of irrigated cropland questioned

Members of the Revenue Committee heard testimony Feb. 19 on a bill that would change how irrigated cropland is valuated.

Currently, some county assessors compare ground water irrigated land with surface water irrigated land when using the sales comparison approach of land valuation.

LB723, introduced by Imperial Sen. Mark Christensen, would create subclasses of irrigated cropland to be used when assessing agricultural land. Christensen said the current method does not take into consideration the capacity of a ground water well or government regulatory actions on surface water.

“We’ve seen decreases in surface water irrigated land solely due to compliance issues [on the Republican River],” he said. “This would reduce taxes on the people who really don’t have the value in the land that it’s being taxed at.”

Under the bill, irrigated cropland would be classified as:
• ground water irrigated;
• surface water irrigated;
• ground and surface water irrigated; or
• limited capacity irrigated.

Marilyn Hladky, representing the Nebraska Association of County Officials, opposed the bill. She said land valuations are driven by the market, not perceived values of land.

“I’ve had property owners protest agricultural land valuations next to a river that floods three out of every four years, but sales showed the land was still selling at a high level,” she said. “Assessors cannot make adjustments arbitrarily. The market has to support these adjustments.”

No one testified in support of the bill and the committee took no immediate action on it.