Replies to This Discussion

Permalink Reply by David Ross on February 1, 2012 at 12:07pm

Not from the investment but from the oil which has put property value HIGHER!!!!!!!!!! 

Permalink Reply by Tom Frey on February 2, 2012 at 12:24am

Funny this is on here. I just received my property tax bill yesterday and it went up and i don't understand why. The land value went up the most.

Permalink Reply by dan gladyszewski on February 2, 2012 at 2:29am

I also question the CAUV taxes. Will they need to be paid? If I take land out of agricultural use, normally the county charges back taxes on the portion taken out. Something like 3-5 years worth.

Permalink Reply by Billy Park Whyde on February 3, 2012 at 7:36am

  The CAUV  would not change as the CAUV is based upon surface usage. If say a well pad uses tow acres of your surface land that could take say two acres out of the CAUV. But the remainder of the land can still be utilized for farming even the two acres after it is reclaimed could be put back into grazing or hay.

Permalink Reply by Utica Shale on February 2, 2012 at 7:26am

Steve,

" ... will real estate taxes increase because of the millions of dollars invested ? ..."

 

  Maybe up ?

  If your real estate taxes are based upon the Fair Market Value of the property and the drilling process causes the value of land in your general area to increase and stay high for some length of time then the higher Fair Market Value may be documented by your Tax Assessor. If the Fair Market Value of your land increases then your Real Estate Tax bill may be increased as well. So indirectly, your real Estate Taxes could go up because of O&G drilling.

 

  Maybe down ?

  Conversley , if you live in an area where people do not want to own land that is drilled for O&G then the Fair Market Value may decrease. If this exists for some period of time then you could eventually pay less in Real Estate taxes.

 

 Fixed Dollar Amounts?

 And finally, there are some items on a Real Estate Tax bill that are calculated at a fixed Market Value on the date the tax law goes into affect and the dollar amount collected will not ever change even with fluctuating Market Values.

 

 

 Here is a question ...

 When the O&G well is capped then how long until the Fair Market Value returns to its "normal" value ?

 

Permalink Reply by steve keller on February 2, 2012 at 11:41am

thanks for your replys!  i talked to my law firm today and they said that  county auditor just had a public discusion  and said  there not sure how there going to handle this . real estate with mineral rights has sky rocketed in every area i know of

Permalink Reply by Billy Park Whyde on February 3, 2012 at 7:48am

Hi Utica what a can of worms this whole issue might be. What is FAIR MARKET VALUE ? In anti frackers fear tactics they say hey no banks will loan upon property that does not have the mineral rights. (If leased it does not have mineral rights) So if a loan can not be had what is the market value? 

 An other issue is will a landowner that chooses not to allow drilling upon their land see a increase in value just because his neighbors did?

 Of course then what is the value in speculation? It would look like $$$ to politicians but in reality not all landowners are going to make out on this.  It even gets more complicated if say a landowner has say 40 acres that a O&G needs to have on order to drill and is a hold out and gets say $8,000 per acre while the other 600 acres only received $1,000 an acre what is the value of the 640 acres in total?  WOW what a mess. 

Permalink Reply by BICS on February 3, 2012 at 6:57am

Increasing taxes on potential mineral value would be a nightmare.  How do you handle land where owners do not own the mineral rights (there is no property tax for the mineral owner (except royality/income tax)   How do you know the potential mineral worth unless you actually start producing (oil/gas potential may vary from area to area).   How do you handle someone who cannot access their minerals because they were left out of a production unit.  As the minerals deplete they would need a method to depreciate the land value.   The only fair method Iam aware of is to tax on the mineral income.  

Permalink Reply by Tom Frey on February 3, 2012 at 7:10am

All i know is that my taxes went up quit a bit and the land value was what went up the most. Now my question is why did it go up when home prices is at a low?

Permalink Reply by Utica Shale on February 3, 2012 at 7:14am

Tom,

 Because the Tax Assessor has determined that Fair Market Value ("COMPS") for land in your area has increased ?

Permalink Reply by Kathleen on February 3, 2012 at 1:38pm

When I was on the Columbiana county auditor website a few weeks ago I saw a few just "mineral rights"  cards with what looked like parcels numbers.  I bet it was just to identify who owns what but they were taxed.  The tax was almost nothing though.  Maybe they were pulling coal out or something but it couldn't have been much.  One example was something like 40-50 acres and the tax bill was under 90 for the year.

Permalink Reply by Dee on February 4, 2012 at 2:21am

I own mineral rights in Ohio and pay property taxes on them every year. They nearly doubled this year. In the past I have done title searches and found that a lot of mineral rights are not being taxed. Mine are and thousands of acres in the county where I own them are.

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