Roger Baker farms more than 1,000 acres in rural Wayne County, the heart of Ohio's dairy-producing counties.
He grows row crops and cuts hay and straw, much of the resulting harvest supporting the area's livestock industry.
There are good years for farmers and not-so-good years -- that comes with the territory.
"If you're going to be a farmer and you're going to harness God's earth to make a living, you've accepted the fact that you're going to get a few things slung at you now and then," Baker said.
But Baker and farmers in Wayne County and throughout the state didn't foresee the skyrocketing tax bills they've experienced in recent years, thanks to a perfect storm of low interest rates and other factors that are considered as part of the farmland taxing formula that's been in place in Ohio for decades.
The combination led to a doubling or tripling or more of property tax bills for some farmers.
"It's stretching everybody," Baker said, noting that his annual tax bill went up $9,000 or $10,000 in the past few years, about a 250 percent increase.
Enter state lawmakers, who for months have been considering ways to address the issue.
The Ohio House and the Ohio Senate have taken slightly different approaches, via a budget amendment and a standalone bill passed by the respective chambers, and some sort of compromised solution could be in a position for final passage in coming weeks.
It's a complicated undertaking, with calls for reform from agricultural and related groups and calls for caution from school and local government advocates, who are concerned about what will happen when taxes are shifted from farmers to other property owners.
"The effects will be to lower property valuations, causing a tax shift to residential taxpayers, disrupting the school funding formula, and resulting in some losses in revenue for school districts," Jay Smith, deputy director of the Ohio School Boards Association, told the Ohio House's Finance Committee late last month. "We urge you to remove this proposal and replace it with an independent review of the CAUV program."
For farmers like Baker, it's not about a handout or a tax cut.
"We're not asking for tax breaks," he said. "All we're asking for is for the equation to get a little more real time and real numbers to today's economy and the environment that we're working in.
Ohio's farmland is taxed under a formula that focuses on its current agricultural use value, or CAUV, instead of its higher developable value. The system was established by voters in the early 1970s as a way to keep property taxes lower on land devoted to agricultural production and to ensure those sites remain in production rather than developed for residential, commercial or other purposes.
The basic formula takes into consideration a variety of factors, including crop yields and prices, production costs and interest and equity rates.
For years, the formula worked as intended. According to the Ohio Department of Taxation, the average CAUV per acre statewide in 2008 was $475, versus a market value average of $2,703. In a place like Wayne County, the per-acre average was a little more than $650, with a market value of $3,706.
Over the past decade or so, however, the formula has led to big upswings in property tax bills at a time of historic downswings in farm income.
"For some farmers, it's going to be hundreds [of dollars in increased tax bills]," said Leah Curtis, policy counsel for the Ohio Farm Bureau. "For some, it's thousands Their values have gone up exponentially. Even if their tax rate stays the same, they're are doubling or tripling their tax -- quadrupling in some cases."
Stan Dixon, a deputy tax commissioner for tax equalization for the state, told lawmakers earlier this year that CAUV rates had "gone from record lows in the mid-2000s to peaking to record highs in 2014."
According to the tax department, in 2016 the state CAUV average per acre had risen to $2,081, with a market value average of $3,889. In Wayne County, it was $2,352 and $5,233, respectively.
"The ag economy started to slide, and then all of the sudden the taxes started exploding," Baker said. "They exploded to a level that I don't think they've ever seen and I don't think anyone dreamed."
Sen Bob Peterson (R-Sabina), who is also a farmer, added, "Farms across the state, every three years, their taxes have doubled. If you were paying $10,000 in taxes nine years ago, six years ago you paid $20,000 three years ago, you paid $40,000 These numbers get real big, real fast A thousand acre farm that's probably $25,000, $50,000, $100,000."
It's been a double whammy for dairy farmers, Baker said, with rising property taxes and feed costs and dropping milk prices.
"I've had plenty of farmers, especially in the dairy industry, say something's got to give somewhere or we're not going to keep doing this," Baker said. "That's extremely troubling to me. If we start to lose dairy farms in our three-, four-county area here, it will change our demographics in a way that nobody, farmer or non-farmer, no member of this community will like."
SUPPORT FOR CHANGE
The Ohio House and Senate have moved different legislation proposing CAUV reforms, the House in an amendment to the budget and the Senate via SB 36.
Both measures would tweak the CAUV formula, with an eye toward making it more reflective of current conditions and farm income and providing incentives for conservation measures. The House also proposed a six-year phase-in on the changes, while the Senate proposed three.
"That will dilute the impact that it has on local governments [and] schools," Rep. Kirk Schuring (R-Canton), who worked on the House language, said of the phase-in proposed in the budget amendment. "We think it's a fair formula Its impact will be minimal because of the way we structured it."
The legislature could move the separate bill or the budget amendment. Senate President Larry Obhof (R-Medina) and Schuring said the latter approach would make sense, given the tax, spending and other policies covered by the biennial budget bill.
Either way, Curtis said the effort represents one of the first major reforms of the CAUV program since its inception.
"We are supporting both [the standalone bill and budget amendment]," she said. "We think they're both great options We're just trying to get some reforms done Both are going to certainly provide important and needed reforms to the calculation."
"Our members have said CAUV reform is their No. 1 priority," Yvonne Lesicko, Farm Bureau's vice president of public policy, added in a released statement. "Farmers need to contact their legislators, let them know how important this is and ask them to support CAUV reform."
Baker, a Farm Bureau trustee, also supports lawmakers' reform efforts.
"It's not like it's going to be a huge windfall for anybody," he said. "It's making this equation more real time in today's economic environment."
While income and sales taxes dominate the state's general revenue fund, property taxes generally are directed into local coffers.
More than $16.8 billion in property taxes were payable last year, not including tax credits reimbursed by the state, according to the Ohio Department of Taxation. School districts had the biggest share of that total, about $10.5 billion, followed by counties with nearly $3 billion.
The proposed changes to the CAUV formula will mostly impact local governments. A fiscal analysis by the state's Legislative Service Commission on the recently passed Senate CAUV legislation projected losses of $20 million or more for local governments and school districts after a three-year phase in period.
An LSC analysis of the House CAUV amendment in the state budget put the losses at $14 million annually after a six-year phase-in. Some of those revenue losses "would be partly offset by higher effective tax rates on residential property owners and also on farmers," according to LSC.
The potential local losses are a rub for school and other groups, with additional concerns that the proposed CAUV reforms would lead to increases in taxes paid by residential property owners, as fixed-dollar levies designed to raise a specific revenue total are shifted to account for lower farmland tax bills.
In testimony before the Ohio Senate's Ways and Means Committee last month, Barbara Shaner, associate executive director of the Ohio Association of School Business Officials, voiced her group's opposition to the legislation, saying it would "significantly reduce local valuations for agricultural property" and "the resulting expansion of benefits to agriculture landowners will create a shift in tax burden to residential owners."
She cited a study by the Ohio Education Policy Institute noting that residential property owners paid nearly 64 percent of total property taxes in 2015, up from about 44 percent in 1990.
In testimony submitted to the Senate Ways and Means Committee, Dixon said a review of potential impacts of proposed CAUV reforms in eight counties found that, " Property tax increases paid by residential landowners increased from minimal amounts to upwards of 10 percent in some taxing districts. The magnitude of the shift is largely driven by the ratio of agricultural property to residential property in a taxing district. Generally, the more rural the district, the larger the shift."
There's a flip side to that possibility however. Farmers say their rising property tax bills has an effect on their willingness to support local levies.
Frank Phelps, past president of the Ohio Cattlemen's Association, told lawmakers earlier this year that farmers could be more open to local ballot issues with CAUV reform.
The group's members are "struggling with levies in their own individual school districts," he said in his submitted testimony. "Our association believes that if the tax burden was more manageable, and the non-agricultural factors were removed, rural districts would be able to support more levies."
Ultimately, Smith said school officials would rather lawmakers pursue an independent study of the CAUV program before making changes to it.
"We understand the impact this is having on farmers," he said, adding, "But we also see that the CAUV formula is working and that those increases that they have seen based on economic conditions, they're coming down. They may not be coming down as fast as farmers would like."
Though the recent vote on SB 36 was unanimous, Sen. Joe Schiavoni (D-Boardman) said lawmakers need to do something to ensure school budgets don't take another hit. He said he's working on an amendment that he'll offer on the biennial state budget bill, if the CAUV amendment remains a part of that bill.