Agricultural tax assessment leaves some confused

WAILUKU - About 8,000 owners of agricultural lands received letters from the county in September, asking them to verify that they qualify for the lower agricultural tax assessment.

The letters have left many landowners anxious and wondering what criteria tax inspectors will use to assess their land, and how the county's decision will affect the taxes they pay and how they can use their property.

County property tax officials will be on hand to provide information and answer questions at a workshop on Agricultural Property Taxation on Monday at 8:30 a.m. at the Pukalani Community Center, in the lower-level meeting room. The workshop is sponsored by the Maui Cattlemen's Association and the Kula Community Association.

Real Property Tax Division Chief Scott Teruya has said the county was asking landowners who receive the ag assessment to verify that they are really using their land for agriculture, in order to make sure the benefit was being applied fairly. Receiving an agricultural assessment can result in significantly lower property tax bills.

The letters mailed out in September ask landowners to describe the agricultural and nonagricultural uses of their properties, and to report the number of acres dedicated to each. They also ask owners to provide a to-scale plot plan and photos that show the agricultural uses of their properties.

Applications are due by Dec. 31 for the coming tax year.

Landowners who have already filed a formal 10-year agricultural dedication weren't sent the letter, because they have already provided the county with information about how they are farming on their land, Teruya said.

Teruya provided the answers to some frequently asked questions about agricultural tax assessments:

* What qualifies as "agriculture"?

Tax inspectors will be looking on a case-by-case basis for "clearly evident" signs of agricultural use, such as fenced pasture with grazing animals, crops planted in rows, irrigation systems or other generally accepted agricultural practices. Plants and trees that are ornamental or part of a property's landscaping won't be considered agriculture.

* Do I need to show I'm selling crops or making an income from agriculture?

No. The county law doesn't require landowners to show receipts, sales or income as proof of farming.

* Do horse pastures count as ag?

Yes. Horse pastures are a legitimate agricultural use, provided that the pasture is fenced.

* What about home gardens?

No. Ornamental and fruit trees, flowers and vegetables grown primarily for home use do not qualify.

* What if I'm leasing or renting property to someone else who is actively farming it?

The property would qualify for agricultural use, however the owner of the property must be the one to sign and certify the application for an agricultural assessment.

* What if tax inspectors decide my property isn't really being used for agriculture?

The property would be taxed at its market value, at a rate reflecting its highest and best use.

* If I lose my ag assessment, will my property be rezoned?

No. The Real Property Tax Division has no power to change zoning. There can be different property tax categories in any zoning district.

* Will someone from the tax office be coming to inspect my property?

Yes. Regular inspections are ongoing, and will continue in the future.

* Why do I need to provide a plot plan? Does it need to be to scale?

The plot plan will be used during field inspections to identify the areas being claimed as agriculture. It should be drawn to-scale to the best of the landowner's ability. It is recommended that the landowner measure the borders of the farm area, but a formal survey is not required.

* How much area needs to be in agriculture in order for me to qualify for the ag assessment?

There is no minimum requirement, but only the portions of land being used for farming will receive the agricultural assessment.

For more information, go to www.co.maui.hi.us/index.aspx?NID=576 or call 270-7297.