Ryan Nicol
Legislation looking to protect farmers’ ability to engage in agritourism moves to the House floor after earning unanimous approval in its third and final committee stop.
Rep. Josie Tomkow, a Polk City Republican, is sponsoring the bill (HB 717). The legislation codifies that farmland can still be taxed at a lower rate even when using parts of the property for agritourism. On Tuesday, the House State Affairs Committee OK’d the measure by a 23-0 vote.
“House Bill 717 is a bill that clarifies the intent of Florida’s agritourism property tax structure,” Tomkow explained Tuesday. “We want to ensure that bona fide agriculture operations have the ability to maintain agricultural operations while also providing opportunities that promote engagement with the public.”
Being classified as a farm can lower property tax rates for landowners. And according to current law, “The conduct of agritourism activity on a bona fide farm or on agricultural lands classified as such … shall not limit, restrict or divest the land of that classification.”
That is, once a farm is classified as being used for “bona fide agricultural purposes,” adding other structures or operations used for agritourism does not automatically void that previous classification.
The legislation from Tomkow would strengthen that clause and more explicitly lay out how those lands would be taxed.
“An agricultural classification … may not be denied or revoked solely due to the conduct of agritourism activity on a bona fide farm or the construction, alteration, or maintenance of a nonresidential farm building, structure, or facility on a bona fide farm which is used to conduct agritourism activities,” the proposed bill reads.
“So long as the building, structure, or facility is an integral part of the agricultural operation, the land it occupies shall be considered agricultural in nature. However, such buildings, structures, and facilities, and other improvements on the land, must be assessed … at their just value and added to the agriculturally assessed value of the land.”
That differentiation between “just” and “assessed” value is key for farmers. Typically, property in Florida is valued at market — or “just” — value, which refers to what the property could be sold for on the open market. Property taxes are then determined based on that just value price tag.
But farms are evaluated differently. Agricultural properties are measured at their “assessed value,” which is the value the land is currently generating. That number is different — and generally lower — than a property’s market value and thus leads to lower taxes for farmers.
The reason is simple: If farmers are generating “x” value from their farms, but they could sell that property at a higher “y” value and are taxed at that higher level, it may make sense to sell and cease farming operations altogether.
For that policy reason, farmers are granted the lower tax rate to encourage them to hold on to the land to promote Florida’s farming industry. But to obtain that lower valuation, a property appraiser must determine the land is being used for “bona fide agricultural purposes.”
Several factors determine whether a piece of land qualifies for that designation. Those factors include the length of time the land has been used for agriculture, whether that use has been continuous and whether the land has been adapted for agricultural purposes, among other factors.
The practice of “agritourism,” which allows individuals to visit farms to observe those operations, doesn’t strictly fit under the definition of “bona fide agricultural purposes.” Still, the industry is vital to Florida’s farmers. Those looking to visit a farm can engage in visiting crop mazes, on-site farmers markets, trail riding, and other activities.
The most recent agricultural census from the U.S. Department of Agriculture (USDA) shows Florida generates $15.7 million per year from agritourism activities. That number comes from the USDA National Agricultural Statistics Service, which last published a report in 2017.
Still, regulators face the question of whether a farm that leans into the agritourism sector would risk its assessment designation and become subject to higher taxes at a market value rate.
While current law does provide an attempt at clarifying the issue, Tomkow’s bill goes further. The legislation spells out that buildings, structures, and facilities used for agritourism do not change the assessed value of the land itself. That means the farm can still take advantage of lower assessment rates.
However, the bill states the structures would be assessed at their “just value,” or their market value, then “added to the agriculturally assessed value of the land.” That creates a hybrid assessment process for farmers but keeps them from paying a total market value tax rate for the entire land.
“I am a seventh-generation Floridian, third generation in the cattle business, so this bill is very near and dear to my heart,” Tomkow added Tuesday.
Sen. Ben Albritton is sponsoring the Senate companion bill (SB 1186). That measure has cleared its first two committee stops and is set for a final hearing in the Senate Appropriations Committee before heading to the Senate floor.
