CHAPTER 58

(SB 2)

Agricultural property assessments,
factors used to determine value revised.


         ENTITLED, An Act to  revise the procedure for assessing certain agricultural property.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:

     Section  1.  That § 10-6-33.25 be amended to read as follows:

     10-6-33.25.   For the purposes of § 10-6-33.24 , the agricultural income value shall be determined using capitalized annual cash rent. The annual cash rent is the annual cash rent, excluding the per acre tax on agricultural land, determined through an analysis of arms-length rental agreements collected within the county in the year three years prior to the year for which the agricultural income value is being determined. The agricultural income value of cropland shall be based on average rents over a three-year period for cropland under natural conditions. The agricultural income value of noncropland shall be based on average rents over a three-year period for noncropland under natural conditions. However, no arms-length rental agreements for irrigated land may be used to determine the annual cash rent pursuant to this section. The annual cash rent shall be capitalized at seven and three-fourths percent.

     The secretary of revenue and regulation may enter into a contract for the collection of cash rent information by county. Cash rent information shall be adjusted by soil survey statistics , if available , and pursuant to section 2 of this Act .

     Section  2.  That chapter 10-6 be amended by adding thereto a NEW SECTION to read as follows:

     The director of equalization shall annually determine the assessed value of agricultural land as defined by §  10-6-31.3. Any agricultural land assessed based on its agricultural income value pursuant to §  10-6-33.24 and 10-6-33.25 may be value adjusted by the following factors:

             (1)    The capacity of the land to produce agricultural products as defined in §  10-6-33.2; and

             (2)    The location, size, soil survey statistics, terrain, and topographical condition of the land including the climate, accessibility, and surface obstructions which can be documented.

     Section  3.  That chapter 10-6 be amended by adding thereto a NEW SECTION to read as follows:

     If the median rent value per acre in an identifiable region within a county deviates by more than ten percent from the county median rent value per acre, the county director of equalization may establish a separate rent value per acre for the land defined by the director of equalization within that identifiable region.

     Signed March 4, 2005
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