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Saturday, January 1, 2011

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Agricultural land tax revisited The Colorado Court of Ap­­­ peals recently considered the question: When is the owner of agricultural property eligible to receive the favorable “agri­ cultural” tax classification? Fortunately for the landowner involved and for the owners of agricultural property in this region, the court took a com­ mon-sense approach to apply­ ing the facts of the case to the Colorado real estate tax law. Under Colorado law, a property that is used for agri­ cultural purposes, where the owner is attempting to make a profit — either from crops or from livestock uses — is enti­ tled to an “agricultural” tax classification. This then results in a favorable tax rate. In this case, the Adams County asses­ sor had classified the subject property as “vacant,” which resulted in a much higher tax rate to the owner, Aberdeen Investors Inc. Aberdeen had purchased the property in 2004 and in July 2005 leased the property out for grazing for the remainder of the grazing season. Aberdeen also leased the property for grazing in 2006 and in 2007 requested that the property be classified as “agricultural.” The assessor denied the request, indicating that the property would have had to be in agri­ cultural use on Jan. 1, 2005, in order to satisfy the requirement that the property be in agricul­

the rules to be interpreted differ­ ently, then the Legislature can amend the law. This type of practical opinion is important to this tural use for the previous two area of Colorado, where our years. growing and grazing seasons Although the court’s deci­ are much more abbreviated sion bogs down a bit in some than much of the state. It also technical legal interpretation, it is important that the court did apply common recognizes that sense in stating, conservation In summary, the “using a property practices might court considered as a farm or ranch dictate that por­ some of the seldom occurs on tions of the agri­ January 1.” Of basic realities of cultural property course, this is not are not used for agriculture in our because farmers and specific agricul­ climate — the ranchers party so tural purposes in seasonal aspect hard on New Year’s a given year. Eve, it is because of much of the As a final aside, this time of win­ activity, the fact consider whether ter is not growing the county asses­ that a portion of season or grazing sor might have the property may season in most of viewed the situ­ Colorado. lie fallow for a time ation differently In summary, the to replenish the — before he clas­ court considered sified this property soil, and the fact some of the basic as “vacant” land that areas may realities of agricul­ in 2007 — if the ture in our climate be excluded from owner had been — the seasonal grazing or tilling the Aberdeen aspect of much of Ranch Inc., rather for conservation the activity, the fact than the Aberdeen reasons. that a portion of Investors Inc. the property may lie fallow for a time to The citation to this case replenish the soil, and the fact that areas may be excluded from is Aberdeen Investors, Inc., v. Adams County Board of County grazing or tilling for conserva­ Commissioners, 240 P.3d 398 tion reasons. The court indicat­ (Colo.App. 2009) ed that the legal interpretation of this property tax law is to be Rich Tremaine is a lawyer reasonably applied to the reali­ ties of agricultural operations. If with Klauzer & Tremaine LLC, of Steamboat Springs. the Colorado Legislature wants

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Steamboat Today, Jan. 1, 2011  

Routt County's daily newspaper

Steamboat Today, Jan. 1, 2011  

Routt County's daily newspaper