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County Taxes Increased 90% for some Ag Properties

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Posted: Thursday, May 10, 2018 8:36 pm | Updated: 9:55 am, Fri May 11, 2018.

   In 2017 the office of Miami-Dade property appraiser, Pedro J. Garcia, changed the formula used to determine the taxable land use rate for ag classified lands.

   Prior to 2017 there was a flat land use rate of $2,000 applied to all

sectors of agriculture in Miami-Dade County whether the land was used for farming fish or farming vegetables.

   The new methodology assigns a rate to each type of agriculture practiced on the land, and then a capitalization rate for that particular industry is applied to determine the specific land use rate.

   The change in methodology resulted in nominal increases to most ag uses, but ornamental nurseries saw their county property tax bills increase by 90% from 2016-2017.

   A 90% one-year county tax increase.

   No notice of change was communicated to the industry. The Notice of Proposed Property Taxes, referred to as TRIM (Truth in Millage Notice) were mailed out just days before Hurricane Irma.  Nursery operators were largely unaware of what was happening downtown as they were in the throes of saving their businesses following the storm.

   In meetings with the property appraiser and staff going back to November 2017 the Farm Bureau and FNGLA (Florida Nursery, Growers and Landscape Association) have identified two major problems with the new methodology that they seek rectified.

   The first addresses the use rates applied to ag classified lands which are determined by examining land leases for each specific sector of agriculture. In some sectors, such as aquaculture, pasture, and livestock, there may be none or only one lease to examine. Even within an industry as large and diverse as the nursery industry the county only had 17 qualified leases from which to determine an average.

   Besides the sheer lack of submitted leases to quantify, the leases they did have were by and large well above the market rate. One lease stood out at $8,500 per acre.

  That’s more than 21 times what some container nurseries lease their land for on the open market today.

   The second major concern was that the new methodology gives the same weight to a lease on one acre as it does to a lease on 20 acres.

Since a weighted average is not used, and since the number of leases is so few, the small parcels that are most likely retail sites on Krome or US#1 skew the results.

   The new methodology has been detrimental to the ag industry as a whole but primarily the nursery industry.

The Farm Bureau and FNGLA have submitted a joint proposal to the Office of the Property Appraiser detailing the remedies for these two methodology problems.

   The first is that they quite simply need to collect more leases, so they have more data, and data that is more representative of lease rates found in the marketplace.

   The second fix is to use a weighted average. Using the weighted average will calculate the average lease price per acre, where their current methodology only determines the average lease price.

   By not using a weighted average, small retail nurseries that are leased in prime locations end up drastically increasing the average.

   The Farm Bureau and the FNGLA are asking the county to collect more qualified leases and use a weighted average for determining the average lease price per acre then an accurate land use rate can be calculated.

   Erik Tietig is vice-president of Pine Island Nursery and serves as president of the Dade County Farm Bureau. Tietig stated in his formal letter to the Miami-Dade County Property Appraiser, “At this time, we request the two changes be implemented and made retroactive to include the 2017 tax year. We believe the inclusion of more fair market value leases and the use of the weighted average will provide a meaningful correction to the current methodology.”

   Barney Rutzke serves as president of FNGLA. The Rutzke family has farmed in South Dade since 1907 and operate Railroad Nursery Inc. Rutzke stated to the property appraiser that, “We want to work together to remedy the concerns of the agricultural property owners in Miami-Dade so they can continue the proud tradition of farming to support their families and


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