Annually, and in accordance with the provisions and
requirements of O.C.G.A.
48-5-269, the Commissioner shall propose and promulgate by regulation as specified by the
Georgia Administrative Procedure Act, tables and standards of value for current
use valuation of properties whose qualifying use is as bona fide conservation
use properties. Once adopted by the Commissioner, these tables and standards of
value shall be published and otherwise furnished to the boards of tax assessors
and shall serve as the basis upon which current use valuation of such qualified
properties shall be calculated for the applicable tax year.
(a) Conservation use land shall be divided
into two use groups consisting of nine soil productivity classes each. These
two use groups shall be agricultural land (crop land and pasture land) and
timber land. The Commissioner shall determine the appropriate soil
characteristics or site index factors for each of these eighteen soil
productivity classes for use as a guide for the assessors. In those counties
where the Soil Conservation Service of the U.S. Department of Agriculture has
classified the soil according to its productivity, the Commissioner shall
instead prepare and publish a table converting the Soil Conservation Service's
codes into the eighteen soil productivity classes.
(b) The state shall be divided into the
following areas for the purpose of accumulating the income and market
information necessary to determine conservation use values:
1. For the purpose of determining the income
of crop land and pasture land, the state shall be divided into an appropriate
grouping of the nine crop-reporting districts as delineated by the Georgia
Agricultural Statistical Service and which shall be referred to as agricultural
districts;
2. For the purpose of
determining the income of timber land, the agricultural districts shall be
combined into timber zones as follows: agricultural districts #1, #2 and #3
shall compose timber zone #1, agricultural districts #4, #5 and #6 shall
compose timber zone #2, and agricultural districts #7, #8 and #9 shall compose
timber zone #3;
3. For the purpose
of determining the market value of agricultural land and timber land, the state
shall be divided into an appropriate grouping of the nine crop-reporting
districts as delineated by the Georgia Agricultural Statistical Service. Such
areas shall be referred to as market regions.
(c) Sixty-five percent of the conservation
use value shall be attributable to the capitalization of net income from the
property and this component of total value shall be determined as follows:
1. For crop land, the income valuation
increment of the conservation use valuation shall be based on the five-year
weighted average of per-acre net income from those major predominant acreage
crops harvested in at least 125 counties of Georgia ("base crops"). In making
this calculation, the Commissioner, utilizing the latest information either
published or about to be published in the Georgia Department of Agriculture's
edition of Georgia Agricultural Facts and the United States Department of
Agriculture Economic Research Service's Costs of Production-Major Field Crops,
shall:
(i) For each year, determine for each
of the nine agricultural districts the yield per acre for each of the base
crops;
(ii) For each year,
determine for each of the nine agricultural districts the acres harvested of
each of the separate base crops and the total acres harvested of all the base
crops;
(iii) For each year,
determine a state-wide price received per unit of yield for each of the base
crops;
(iv) For each year,
determine a state-wide cost of production consisting of the typical costs
incurred in the production of the base crops, including, but not limited to,
the reasonable cost of planting, harvesting, overhead, interest on operating
loans, insurance and management;
(v) For each year, using the determinations
herein, compute for each of the nine agricultural districts, the weighted net
income per acre by summing the results of the computation of each base crop's
net income obtained by multiplying the yield per acre times the percentage of
total acreage times the price received and then making a reduction to account
for the cost of production;
(vi)
Compute for each of the nine agricultural districts, the per acre income
valuation by capitalizing the average per acre weighted net income before
property taxes, utilizing the rate of capitalization provided for in O.C.G.A.
48-5-269plus the effective ad valorem tax rate;
2.
(i) For
pasture land, the income valuation increment of the conservation use valuation
shall be based on the five-year weighted average of per-acre rental rates of
pasture property. In making this calculation, the Commissioner, utilizing the
latest information available, shall:
(ii) Compute for each of the nine
agricultural districts, the per acre income valuation by capitalizing the
average per acre rental rates weighted by the acreage of hay harvested each
year utilizing the rate of capitalization provided for in O.C.G.A.
48-5-269;
3.
(i) The income valuation derived for crop
land and pasture land shall be combined into the income valuation for
agricultural land by calculating and applying a weighted average of all crop
and pasture acreage in each agricultural district.
(ii) Using soil productivity data from the
Soil Conservation Service of the U.S. Department of Agriculture, determine
productivity influence factors by calculating the relationships between the
volumes of corn that will grow on the soils contained within each of the nine
productivity classes. Apply these factors to the per acre income valuation of
agricultural land to determine the income valuations for each of the nine soil
productivity classes.
4.
For timber land, the income valuation increment of the conservation use
valuation shall be based on the five-year weighted average of per-acre net
income from hardwood and softwood harvested in Georgia. In making this
calculation the Commissioner shall:
(i) For
each timber category and zone, determine for the immediately preceding five
years for which information is available, the unit prices received by the
sellers of standing timber in Georgia from reports received by the Commissioner
of actual sales, from information furnished by the Georgia Forestry Commission,
from commercially prepared publications of average sales prices, or from a
combination of these sources;
(ii)
For each timber category and zone, determine the average volumes of the various
types of timber harvested annually in Georgia;
(iii) For each timber category and zone,
compute the gross income each year from the harvests of timber by multiplying
the unit price for each year times the annual average harvest volumes of each
type of timber harvested;
(iv) For
each timber zone, determine the acres of softwood timber land and hardwood
timber land;
(v) For each timber
zone, compute the weighted gross income per acre for each year by dividing the
gross income from the harvest of softwoods each year by the acreage of softwood
timberland; dividing the gross income from the harvest of hardwoods each year
by the acreage of hardwood timberland and weighting the two resulting per acre
gross incomes by the percentage of acres of softwood and hardwood timberland to
total acres of timberland;
(vi) For
each timber zone, determine the costs of production of timber for each year
including, but not limited to, the cost of site preparation, planting,
seedlings, prescribed burnings, management, marketing costs and ad valorem
taxes due on the harvest or sale of timber;
(vii) For each timber zone, determine the
acreages of timberland annually receiving production treatments, i.e. site
preparation, planting and burning;
(viii) For each timber zone, compute the
production expenses per acre incurred each year by multiplying the expense by
the appropriate factor, i.e. multiply the cost of site preparation per acre by
the percentage of acres annually receiving this treatment, multiply the harvest
tax millage by the weighted gross income per acre;
(ix) For each timber zone, compute the net
income per acre for each year by subtracting the production expenses incurred
during the year from the weighted gross income per acre for that
year;
(x) For each timber zone,
calculate the per acre income valuation by capitalizing the average per acre
net income before property taxes, utilizing the rate of capitalization provided
for in O.C.G.A.
48-5-269plus the effective ad valorem tax rate;
(xi) Determine productivity influence factors
by calculating the relationships between the volumes of Loblolly Pine grown on
each of the nine productivity classes of soil and apply these factors to the
per acre income valuation for the benchmark land, to determine the income
valuations for each of the nine soil productivity classes.
(d) Thirty-five percent of the
conservation use value shall be attributable to values produced by a market
study consisting of sales data from arms length bona fide sales of comparable
real property with and for the same existing use. In determining this increment
of total value, the Commissioner shall:
1.
Gather a statistically valid sample of qualified sales of agricultural and
timber properties;
2. Calculate a
residual land value for each sale in the sample by adjusting the sales price to
remove any portion representing value attributable to any component of the sale
other than the land;
3. Utilizing
the residual land value sale prices, determine, as far as is practical, the
relationships between the average sales price per acre for each of the nine
soil productivity classes in each of the market regions.
(e) Environmentally sensitive properties and
constructed storm water wetland conservation use properties shall be classified
by the board of tax assessors as being within the timber land use group and
shall be valued according to the current use value determined for timber land
of the same or similar soil productivity class.
(f) The current use value for land lying
under water, such as ponds, lakes or streams, shall be the value determined for
the lowest productivity level of the predominate adjacent land use.
(g) Land utilized for an orchard or vineyard
shall be classified as crop land. The trees, shrubs or vines shall be
considered an improvement to the land and separately valued.
(h) Current use valuation for qualified bona
fide residential transitional property shall be determined annually by the
board of tax assessors by the consideration, as applicable, of the current use
of such property, its annual productivity, if any, and sales data of comparable
real property with and for the same existing use.
(i) Except as otherwise provided, the total
current use valuation for any property, including qualified improvements, whose
qualifying use is as bona fide conservation use property for any year during
the covenant period shall not be increased or decreased by more than three
percent from the current use valuation for the immediately preceding tax year
or be increased or decreased during the entire covenant period by more than
34.39 percent from its current use valuation for the first year of the covenant
period. The limitations imposed herein shall apply to the total value of all
the conservation use property that is the subject of an individual covenant
including any improvements that meet the qualifications set forth in O.C.G.A.
48-5-7.4(a)(1);
provided, however, that in the event the owner changes the use of any portion
of the land, such as from timber land to agricultural land, or adds or removes
therefrom any such qualified improvements, the limitations imposed by this
subsection shall be recomputed as if the new uses and improvements were in
place at the time the covenant was originally entered. This limitation on
increases or decreases shall not apply to the current use valuation of
residential transitional property.
O.C.G.A. §§
48-2-12, 48-5-7, 48-5-7.4, 48-5-269.
