Increased Tax Assessments Continue to Plague Maryland Farmers

Increased Tax Assessments Continue to Plague Maryland Farmers
Written by Jeb Burchick
Originally published in the 2024 Fall/Winter Edition of The Old Line Farmer

If you’re a business owner planning your yearly budget, you usually wouldn’t expect your property taxes to double. Yet, for some Maryland farmers, that’s exactly what can happen.

Howie Feaga, who owns a hay farm and horse boarding facility in Ellicott City, knows the challenges of housing nearly a hundred horses. It requires vast space to care for these animals, and knowing their need for constant exercise, Howie built a large barn on his ag-preserved property to store hay and provide a riding ring.

Given the size of his facility, hefty property taxes are not necessarily unexpected. However, Howie was stunned when the Maryland State Department of Assessments and Taxations (SDAT) increased his property tax assessment by over $900,000, pushing his total fees well past $1.5 million. In an industry with already tight margins, such an increase could put operations out of business. Although Howie successfully appealed the assessment to a more manageable figure, this time-consuming headache could have been avoided.

“If a property is in ag preservation, [SDAT] needs to make sure that what they are assessing is an agricultural building,” declares Howie. “There was nothing being done inside that barn other than horses getting exercise – you can’t call that commercial.”

Howie Feaga stands in front of hay grown and harvested on his family farm.

Howie is not alone, many Maryland farmers are burdened with exorbitant and seemingly unexplainable increases on their property assessments. Many assessments have come after farm operations have upgraded their facilities to accompany value-added endeavors. According to a survey distributed by the Maryland Farm Bureau, over 1,100 properties have seen their assessments go up at least 25%, with some as high as 600%.

Unlike land, farm buildings are taxed similarly to residential houses, according to their size and features. SDAT has utilized aerial imaging to speed up the identification and assessment of new buildings. But without actual boots on the ground, farmers are frustrated with the assessment process, seeing a direct correlation between their tax increases with the department’s new technology.

“Our members face pressures from things such as development, renewable energy siting, and rising cost of business,” says Tyler Hough, Maryland Farm Bureau’s Director of Government Relations. “This has led to farmers looking at various ways to diversify, including value-added agriculture, but it comes with risks.”

For the past three legislative sessions, bills were introduced by legislators in Annapolis to address the tax increases. Although well-meaning in nature, the bills did not address the root cause of the issue, and some were ultimately withdrawn from their sponsors.

Howie Feaga discusses tax policy at his farm with Tyler Hough.

“With potential legislation for this issue, members of the Maryland Farm Bureau look for two main pieces. The first would be a solid definition of value-added agriculture that is concise and not open ended,” explained Tyler. “The second would be for all agriculture to be assessed at the same rate. The beauty of Maryland agriculture is its diversity, so no matter what the agriculture looks like, it should be all assessed the same.”

Despite these problems, some farmers do see a sense of optimism that the situation can be resolved. When Howie shared his story in a December meeting with Governor Wes Moore and Maryland Department of Agriculture Secretary Kevin Atticks, he was met with a sympathetic ear and a heartfelt apology from the Governor.

Howie encourages his fellow members to share their similar stories with legislators: “Educating them is probably the only way that we’re going to get a fix.”

Howies right. Any improvements in the assessment process cannot happen without the input of our state’s farmers and supporters of agriculture with their elected officials. The Maryland Farm Bureau encourages its members to get involved in the legislative process.

“It is important for our members to use the power of the grassroots organization when issues like this arise. Many in Annapolis are unaware of these problems until it has been brought to their attention,” says Tyler. “Many families in agriculture are affected and by contacting their elected officials, it will only further help move us towards a fix for Maryland farmers.”

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