Legislator plants seeds for reasonable reform
Colorado long ago established the agricultural category for property tax classifications as a means to encourage farm and ranch production.
But, as a legislative task force determined, and many others have observed, the agricultural tax classification is often misused and abused by people who have only a slim connection, at best, to agriculture.
State Rep. Tom Massey, R-Poncha Springs, is hoping to change that with a bill that would tighten some restrictions related to the agricultural classification.
We believe the bill is a good starting point for addressing some of the tax abuses, but more can and should be done to end those abuses, while maintaining the agriculture classification for those engaged in legitimate agricultural enterprises.
There are many examples of those engaged in more dubious agricultural enterprises who receive the lower-rate ag classification for their property.
For example, a report in The Denver Post Monday listed more than a dozen properties in Colorado owned by wealthy people who pay reduced taxes on their land because of the agricultural classification.
They include Hollywood actor Tom Cruise, who owns 248 acres of land near Telluride, and pays $400 a year in taxes for most of it because sheep graze on the land for brief periods each year.
Colorado law requires that homes on agricultural property be classified at the higher, residential rate. As a result, Cruise paid $11,380 in taxes for his multimillion-dollar home on his land, according to the Post.
Massey’s bill wouldn’t prohibit Cruise or any other well-heeled landowner from receiving agricultural classifications on large parcels of property.
But it would place the two acres of land surrounding a home in the higher, residential property classification unless the property owner can show those two acres are “integral” to the agricultural enterprise that led to the agricultural classification.
No doubt, the sheep grazing on Cruise’s property a few days each year would get along just fine without the two acres of land immediately surrounding his house.
As we said, Massey’s bill is a good step in the direction of ending abuses of property categorized as agricultural for tax purposes. But much more should eventually be done to differentiate between those who are truly attempting to make money farming and ranching, and those who simply want to avoid paying higher taxes for their pricey property.
Still, for now there is only Massey’s bill. The Colorado House should approve House Bill 1146 when it comes to the floor for a vote later this month.