SB 112 (Cisneros) and HB 112 (Gonzales) – Definition of Agricultural Land for Taxation address a critical issue in acequia communities – the change in tax status from agricultural land to other status (vacant, residential, etc.). State law and tax regulations allow county assessors to have a special method of valuation for agricultural lands used for raising crops or livestock. Agricultural lands qualify for a method for determining the "value" of lands so that those lands have a lower appraised value. With a lower value, the taxes are lower that they would be for other types of land such as vacant land or residential. This is a very important part of New Mexico tax policy that protects agricultural lands from high rates of property taxes. In acequia communities this is vitally important to keep lands in agricultural production and to protect continuity in agricultural use. It protects landowners and families with long-time ties and long-term commitment to agricultural use of the land.
The law as it is has served agricultural communities well in past years and assessors have used a fair amount of discretion in applying the special method of valuation of agricultural land. However, new conditions require that the law allow for greater consideration of drought conditions that are contributing to less frequent or consistent use of lands for crops or livestock. Because of the drought, landowners may not be able to raise crops or livestock for a number of years. An update in the law to allow consideration of drought will provide more latitude to assessors to account for years of drought when determining eligibility for the special method.
Ultimately, this could help protect lands affected by drought by providing a tool to retain it as agricultural land for tax purposes.
NMAA strongly supports this bill. The companion bill on the House side was amended so that the priority focus of the bill is on drought. Some technical issues were raised on how to specifically define drought and that may be addressed in the next committee.