The Idaho State Tax Commission has asked Bannock County to devise a plan for addressing rampant irregularities in tax appraisals on its agricultural land.
Through a recent audit reviewing a random sampling of agricultural appraisals, the tax commission determined many Bannock County farm fields have been incorrectly categorized for taxing purposes.
Specifically, tax commission staff noticed from reviewing aerial photographs of the properties that some fields classified for dry-land production had irrigation pivots on them. Bannock County Commissioner Steve Brown said tax commission staff physically went to fields to confirm their suspicions. Brown said dry-land fields have a taxable value of $80 per acre, compared with $1,200 per acre for irrigated fields.
Officials with the tax commission addressed the county commissioners about the issue on Tuesday.
“The report we got from the tax commission is they have no faith in the information and the work being done by the assessor,” Brown said, adding that a recent unwillingness by Bannock County Assessor Sheri Davies to communicate with the commission has exacerbated problems.
Davies, who did not attend the Tuesday meeting but has been in discussions about the issue with the tax commission for several days, traveled to Boise on Thursday to mull strategies with tax commission staff and representatives from Idaho Gov. Brad Little’s office.
“It was a good meeting. ... We all came out with a definite direction,” Davies said.
Davies believes the current problems stem from the fact that the previous assessor stopped using a contractor for agricultural appraisals in 2014, and she has nobody on staff who specializes in agricultural land.
Davies said the state officials were receptive to her plan — adding a specialist in agricultural land to her staff who will spearhead an intensive review of farm-ground appraisals throughout this year.
She said a specialist has already been identified and will start training next week, with the tax commission’s assistance. She acknowledged a hurdle will be getting funding approved from the county commission.
If the county fails to address the problem, however, the state will make the necessary corrections at the county’s expense.
“I am optimistic as long as the commissioners are willing to give me the tools I need to do my job,” Davies said.
The first Brown had heard of the assessor’s plan was when he was contacted by the Journal on Thursday night. He said Davies has already maxed out her budget — the commission has already approved an additional employee and new furniture for her office. He’s encouraged that she has a plan, however.
“I don’t even know anything of what she’s doing. I look forward to hearing about it,” Brown said.
The first-term assessor has faced a constant stream of headaches since taking office in January 2019. Last summer, she announced her intention to bring property values she said had fallen behind up to full market value. Homeowners were so taken aback by double-digit percentage increases in many residential appraisals that they filed more than 3,000 appeals. The Idaho State Board of Tax Appeals is still hearing many of those cases and had to ask the Legislature for an extra $42,000 to handle the extra work.
Furthermore, recently elected Pocatello City Councilwoman Claudia Ortega led an unsuccessful campaign to recall Davies and all three county commissioners for their roles in the appraisal fiasco. Public antipathy about the local property tax burden and the new appraisals helped Ortega get elected, following a campaign in which the issue dominated her political rhetoric.
Davies said the county is in year three of a five-year plan, set up by the previous assessor, to physically re-appraise all of its properties. The county fell just short of meeting a milestone of having 35 percent of its properties physically appraised by now, she said. The physical appraisals are used to justify estimate-based adjustments to values of all of the other properties.
Davies said she’s not certain any physical appraisals of agricultural land have been done since 2014. During that time, many changes have happened on area farms, such as pivots being installed on fields that were previously dry land, she said.
She acknowledged that if agricultural appraisals are too low “it does shift the burden somewhere else.”
“That’s what we’re trying to avoid,” Davies said. “It’s been a mess.”
Brown emphasized that the corrections are “forward looking” and property owners in other categories won’t receive any back compensation for potentially shouldering an unfair share of the tax burden because of improperly classified agricultural land.
Davies said the tax commission changed its approach to conducting agricultural appraisals two years ago, which has added to the challenge, and many other counties in the state are dealing with the same issue.
Davies assures the public that the problems are confined to farm land. The county’s residential properties are now in compliance with state policy and have been adjusted to within 95 percent of market value, she said.
Davies vows she’ll work with the county commission, the tax commission and other parties to get agricultural ground properly classified and avert a worst-case scenario of the state coming in and taking over.
“I am grateful that all of the parties involved — the State Tax Commission, the commissioners, my office, the governor’s office — we are all really talking about trying to work together so that Bannock County is moving in a good direction,” Davies said.
Officials with the State Tax Commission and the governor’s office could not be reached for comment.