CHAPTER 3:
FARMLAND ASSESSMENT AND TAXATION IN WEST VIRGINIA
 Hettiarachchige Banduratne and Dale Colyer

    A variety of government programs and policies have been developed by several states to promote the preservation of agricultural land.  These are primarily in the form of monetary incentives to enable farmland owners to resist economic pressure to sell out for development or to prevent the conversion of their land to other non-agricultural uses.  One of the more popular policies currently in use is the provision of property tax relief.  Because land values have tended to rise more rapidly than farm incomes, the assessment and taxation of farmland based on residential, business or industrial land values can result in tax burdens that decrease the economic feasibility of farming and put pressure on farmland owner to convert the land to other uses.

    The most widely adopted property tax relief technique used to preserve farmland is differential or use value assessment.  It allows agricultural lands to be appraised at their use values rather than at their market values.  This results in lower assessment levels and, consequently, lower tax bills for farmers.   Use value assessment for farmland was authorized in West Virginia by the Shifflet Amendment of 1977 and was given a constitutional basis by the Tax Limitation and Homestead Exemption Amendment of 1982.  Although the State Tax Department has developed guidelines and procedures for implementing use value assessments in West Virginia, they are generally not being used to assess farmland values here.  Farmers have not complained about this situation because it is believed that current assessment practices have resulted in assessment values for farmland that are lower than those that would exist if the use value assessment procedures were implemented.
This monograph chapter reviews the concepts of use value assessment and real estate taxation in West Virginia.  It also examines the implications of legislation adopted in 1990 that mandates that West Virginia's farmland be reappraised at its use value and that all other property, except for managed timberland, be reappraised at its fair market value. Since use value guidelines and procedures have not been implemented, a simulation model is presented which estimates the impacts of these changes in West Virginia's system of property taxation.
 Property or Real Estate Taxes
Property taxes in the United States originated, and have continued to be used primarily, as a local tax although they were used by the Federal government in a few instances (Musgrave and Musgrave, 1984).  The property tax is an annual levy imposed by a governmental taxing authority on real and/or personal property.  Most are ad valorem taxes, that is they are based on the monetary value of the property.  They are used primarily for financing county and city governments, schools, and other local government entities.
Important concepts related to property taxes are market, appraised and assessed values.  Market value is the amount that a property would sell for in an open market, i.e., in a voluntary sale between an informed and unrelated buyer and seller.  The appraised value is the price placed on the property by the taxing authority and is supposed to represent the property's fair market value.  The assessed value is an administratively determined value which is used to compute the taxes levied by multiplying it by the appropriate tax rate.  In West Virginia, the assessed value is determined by the state legislature as a percentage of the appraised value, currently 60 percent.
The property tax is of particular concern to farmers because they tend to have large investments in the land, buildings and equipment necessary for farming.  In an environment of continually developing technologies, farmers frequently are compelled to invest in additional land and equipment to remain competitive.  This generally means that they must pay higher property taxes than other businesses and individuals.  A small change in tax rates or assessments can bring about relatively large changes in a farm operator's costs and net income.
 Use Value Assessment
In farming areas, especially those on the rural-urban fringe, there are large differentials between the value of land as an input for the production of agricultural commodities and it's value as an input for development (Keene et al., 1976).  These differentials have caused most states to adopt legislation providing for the differential assessment of agricultural land as a mechanism to enhance the economic viability of farming.
There are three general types of differential assessment laws: pure preferential assessment, preferential assessment with deferred taxation, and preferential assessment with restrictive contracts and agreements (Hady, 1970).  West Virginia's law authorizes the use of pure preferential assessments for farmland.
Pure preferential assessment approaches assess farmland on the basis of its value as farmland rather than on its actual market value.  Typically, these assessments are determined by utilizing either a market value approach or a capitalization approach.  The market value approach uses sales of comparable farmland properties where non-farm influences are absent to determine the land's assessed value.  However, since few, if any, land sales of this type are typically identifiable, most states use the capitalization of net income approach to determine use values for farmland.  In this approach, the use value is calculated by determining the land's net income per acre and dividing it by a predetermined interest rate.  For example, if the net return per acre is $30 and the interest rate is 10 percent, the per acre use value would be $300 (30/.1 = 300).  In West Virginia, farmland rental values are utilized to determine the per acre returns for farmland.
One potential drawback of using the pure preferential assessment approach is that land speculators can avoid property taxes by purchasing farmland for purely speculative reasons, engage in very minimal farming operations to give an appearance of using the land for agricultural purposes, and then enroll in the use value assessment program to reduce their tax burden while they wait for the land to appreciate in value.  This drawback is addressed by the preferential assessment with deferred taxation, or roll back taxation, approach.  It makes it possible for the government to recapture some or all of the property taxes which program participants were excused from paying under the use value assessment program by requiring defaulters, those who sell their land for development, liable for back taxes when their land is converted to the non-eligible uses (Keene, et al., 1976).
The third type of differential assessment program includes restrictive agreements, where land owners agree not to develop their land for a specified period of time in exchange for lower property taxes.  This approach has considerable potential for maintaining land in agricultural use, at least over the term of the contract.  However, it may be less effective for awarding tax benefits to farmers because the prospect of being locked in and unable to develop their land when it is in their interest to do so may deter some farmers from participating in the program.
 Farm Property Taxes in West Virginia
Taxes on farm real estate in West Virginia are very low in comparison to those for most other states.  In 1988, West Virginia ranked 46th of 49 states (excluding Alaska) in average property taxes per acre and was tied at the bottom in terms of property taxes per $100 of farmland value (Hexem et al., 1990).  As indicated in Table 1, although all of West Virginia's neighboring states use some form of use value assessment to reduce the assessed value of farmland in their state below market values, West Virginia's property tax rates on farmland, both in terms of property taxes per acre and per $100 of value, are the lowest in the region.
Changes in West Virginia's average property tax rates both in terms of property taxes per acre and per $100 of value since 1950 are shown in Figure 1.  Property taxes paid per acre of farmland have been increasing due to somewhat higher property tax rates and to higher assessed values per acre.  However, assessments did not keep pace with rising farmland values after the mid-1960s.  Consequently, property taxes paid per $100 value of farmland declined continuously for nearly twenty years until leveling off in the mid-1980s.
 Taxation of Farm Real Estate
As Table 2 indicates, the number of farms and the land area in farms in West Virginia have declined steadily for the last five decades, except for a short period between 1978 and 1983.  This has been the general trend throughout the country, but the
rate of decline is substantially higher in West Virginia than the average for the nation.  In West Virginia, the land area in farms
  Table 1
 Farm Real Estate Taxes in West Virginia
 and Surrounding States, 1988

???????????????????????????????????????????????????????????????
State   Tax Rate Per Acre  Tax Rate Per $100           Value
???????????????????????????????????????????????????????????????
Kentucky     2.36    0.26
Maryland      9.37    0.41
Ohio      9.95    0.83
Pennsylvania   14.57    0.92
Virginia     5.83    0.49
West Virginia    1.01    0.15
???????????????????????????????????????????????????????????????
49 State Average   4.92    0.77

Source: Roger Hexem, et al. 1990. Agricultural Resources:   Agricultural Land Values and Markets. Washington, DC:  Economic Research Service, U.S. Department of Agriculture, AR-18.
 Figure 1 here
  Table 2

 Selected Farm Real Estate Statistics for West Virginia, 1950-87

                    ?Value of Land and Buildings?    Taxes
                    ?????????????????????????????????????????
      Number  Land  ?      ?         ?          ?  Per
        of     in   ? Per  ?  Per    ?  State   ? $100    Per
Year  Farms   Farms ? Acre ?  Farm   ?  Total   ? Value   Acr
??????????????????????????????????????????????????????????????
     (Thous- Million   -- Dollars --    Million   --Dollars---
       ands)  Acres                     Dollars
1950    87.5    8.6     59     5,800       507     0.38   0.22
1951    81.0    8.4     65     6,800       548     0.34   0.22
1952    75.8    8.3     69     7,600       573     0.31   0.21
1953    70.0    8.2     68     7,900       556     0.31   0.21
1954    65.0    8.0     67     8,300       539     0.32   0.21
1955    62.0    7.7     68     8,400       524     0.32   0.22
1956    59.0    7.4     69     8,700       513     0.32   0.22
1957    56.0    7.2     71     9,100       508     0.33   0.23
1958    53.0    7.0     73     9,700       511     0.33   0.24
1959    50.0    6.8     76    10,300       516     0.39   0.30
1960    47.0    6.7     75    10,700       504     0.41   0.31
1961    44.0    6.6     76    11,400       502     0.44   0.33
1962    42.0    6.5     80    12,400       522     0.45   0.36
1963    40.0    6.4     82    13,100       525     0.47   0.39
1964    38.0    6.2     87    14,200       538     0.46   0.40
1965    37.0    6.1     91    14,900       552     0.47   0.43
1966    35.0    5.7     97    15,800       553     0.48   0.47
1967    33.0    5.5    103    17,200       568     0.48   0.49
1968    31.0    5.3    114    19,600       607     0.45   0.51
1969    30.0    5.2    127    21,900       658     0.42   0.53
1970    29.0    5.1    136    23,900       694     0.41   0.56
1971    28.0    5.0    151    27,000       755     0.37   0.56
1972    27.0    4.9    173    31,400       848     0.33   0.57
1973    26.5    4.9    204    37,300       989     0.28   0.57
1974    26.5    4.9    262    48,000     1,271     0.23   0.60
1975    22.0    4.3    300    58,600     1,290     0.21   0.63
1976    21.0    4.2    393    78,600     1,650     0.18   0.71
1977    20.0    4.1    430    88,100     1,762     0.17   0.73
1978    19.6    4.0    459    93,700     1,837     0.16   0.73
1979    20.2    4.1    592   123,200     2,427     0.13   0.77
1980    22.0    4.2    669   127,700     2,810     0.11   0.74
1981    22.2    4.5    681   138,000     3,064     0.12   0.82
1982    22.3    4.3    723   139,400     3,109     0.11   0.80
1983    22.8    4.0    688   120,700     2,752     0.13   0.92
1984    22.0    3.8    698   120,702     2,654     0.14   0.92
1985    22.0    3.8    607   120,667     2,186     0.17   0.92
1986    20.6    3.6    616   104,096     2,281     0.17   0.94
1987    21.0    3.7    633   108,599     2,243     0.16   0.99
??????????????????????????????????????????????????????????????

Sources: Farm Real Estate - Historical Series Data 1950-1985.
1988. Washington, DC: ERS/USDA, Stat. Bul. No. 730; Agricultural Resources, Agricultural Land Values and Markets. 1990. Washington, DC: ERS/USDA, AR-18.
 

has declined by more than 50 percent, from 8.6 million acres in 1950 to 3.7 million acres in 1987, while the decline for the nation as a whole was only about 15 percent.
As Table 2 indicates, although the amount of land used for agricultural purposes has declined significantly in West Virginia, the U.S. Department of Agriculture reports that the estimated market value of farmland and buildings in West Virginia continued to increase at a steady pace from 1950 to 1982, where it peaked at $732 per acre and $139,400 per farm.  Although there was a slight decline in per acre as well as per farm values in the mid-1980s, average farmland values have reportedly begun to rise again in 1988.
There are several reasons why West Virginia's farm property tax rates are low compared to national averages.  First, the regular levy rates on Class 2 property, which include farm real estate, are limited by the 1932 Tax Limitation Amendment to one dollar per $100 of assessed value.  Second, actual tax rates per $100 of market value have been relatively low because the appraised values of farmlands did not keep pace with the increase in the real market values for farms.  As a result, West Virginia has had a de facto preferential assessment for farmland in most counties.
As Table 2 indicates, although West Virginia's nominal property tax rate (regular levy plus bond levies, etc.) has remained around $1.30 per $100 value for farm real estate, the effective tax rate per $100 of market value has always been much lower than $1.30 and has declined significantly since the mid-1970s.
At the same time that property taxes per $100 of value declined, property taxes per acre increased, primarily because farmland values increased.  Nonetheless, West Virginia's property taxes per acre are still very low when compared to other states.  Also, property taxes per $100 of net farm income in West Virginia also are relatively low when compared to other states. Estimates based on 1987 Census of Agriculture data indicate that property taxes on West Virginia's farmland were $88.89 per $100 of net farm income compared to $175.90 for the nation.
 The Property Reappraisal Program
The Tax Limitation and Homestead Exemption Amendment of 1982 required that the Tax Commissioner reappraise all property for assessment purposes and relate this appraisal to a specified base year.  The base year for the first Statewide reappraisal was to be 1983.  It also required the Tax Commissioner to conduct periodic reviews of property and a statewide reappraisal of all property at ten year intervals after the first statewide reappraisal was completed in 1985.
To mitigate the anticipated increase in taxes that would occur due to reappraisal, the assessed value was defined as 60 percent of the property's appraised value.  Also, the increased tax due to the reappraisal values was to be phased in, with equal annual increments, over a period of ten years.  The state contracted with private firms to carry out the reappraisal. Although the reappraisal was conducted, it was not implemented.  Consequently, a Tax Study Commission was appointed by the 1989 state legislature and it made a report to the 1990 legislature.  The 1990 legislature then adopted legislation (H. B. 4127 and S. B. 8) that requires the 55 county assessors to revalue all real estate to reflect its market value over a three year period.  The assessed value is then to be set at 60 percent of the market value.
 Farm Use Valuation
The 1982 Amendment made a special provision to further mitigate expected large tax increases that would have been experienced by farmland owners consequent to reappraisal.  Farm property was to be appraised at "...its fair and reasonable value for farming regardless of what the value would be if it would be used for some other purpose."  Implementing legislation decreed that assessments be based on the income the property would earn if rented (W. Va. Code 11-1A-10a).
To qualify for use valuation, farmland owners must submit an application to the county assessor each year.  The assessor has the authority to grant use valuation for applicants who qualify.   If a land owner does not agree with the assessor's decision, they can appeal to the assessor for a change.  If the assessor refuses to make the change, they can then appeal to the State Tax Commissioner and, ultimately, to the Circuit Court in the county where the land is located (W. Va. Code 11-3-24a).
The eligibility criteria for qualifying for use value assessment are defined in 110-1a-10.6c of the valuation regulations issued by the State Tax Commissioner.  The requirements are that the property must be classified as a farm and be agricultural land used for farm purposes at least seasonally during the year immediately preceding the current tax year.  A farm is defined to include:
...land currently being used primarily for farming purposes, whether by the owner or by a tenant and which has been so used, at least seasonally during the year immediately preceding the then current tax year but shall not include land used primarily in commercial forestry or the growing of timber for commercial purposes" (Farmland Valuation Regulations, 110-1a-10.5f).

To be classified as a farm the property was to meet one of the two following criteria:
1. The parcel should be 5 acres or more and used for the production of farm products with an annual value of $1,000 or more.

2. For parcels less than 5 acres the land must used for the production of farm products for sale with annual proceeds that must be $500 or more.

Farm purposes is defined in the regulations as the "utilization of land to produce for sale, consumption or use of any agricultural products including farm wood lots and the parts of a farm which are lands lying fallow or in timber or in wasteland."
Exemptions from the requirement of utilization of land in the preceding year can be given for farms that were temporarily out of production and/or temporarily operated at less than full value due to a change in management or due to natural disaster.  In the case of farms which produce biennial harvests, the production of a harvest having the minimum stipulated value in the year of the harvest is sufficient to qualify that farm for use valuation in both years.  Farms that are still in the development stage also would be eligible for farm use valuation if they could reach the minimum required production value within ten years from the first year for which farm use valuation is applied for.
Participation in the use value assessment program is voluntary.  The relative leniency of eligibility requirements for participation, coupled with the fact that there is no obligation on the part of land owners to commit the land for agricultural use for a specific time period beyond one year, and the absence of deferred taxation provisions potentially makes the program attractive enough to expect a high participation rate of farmland owners.
 Analysis of Use Valuation Impacts
This section uses a simulation model to determine the likely impacts of implementing use valuation of farmland in West Virginia as mandated by the state legislature.  The model is used to estimate the tax impacts on farmland owners, revenue of local authorities and tax burden shifts among different property classes.
The data used for the simulation are estimates of actual 1987 assessed values for farm real estate; assessed values that would have resulted for 1987 after the statewide reappraisal using a market valuation approach; and assessed values that would have resulted for 1987 after the statewide reappraisal using the income capitalization approach.  The model estimates impacts at both the state and county levels.
It must be noted at the outset that the simulation model does not account for two factors that affect the amount of property taxes paid by farmers: the value of homesites on farms and homestead exemptions.  A 1986 amendment to Senate Bill 10 of 1983 provided that the definition of farmland "shall not include one acre surrounding the principal residence situated on a farm which shall be valued as a homesite in the same manner as surrounding homes and properties not situated on a farmland" (W.Va. Code 11-1A-3f).  The value of homesites on farmland could not be incorporated in the simulation model due to the difficulty of estimating the number of homesites involved and their valuations.  Since 1990 legislation requires that farmland is to be valued according to its use and farmland homesites are to be valued according to their fair market value, the likely effect of this provision is to increase the tax burden of farmland owners who also own residences on their farms.  This increased tax burden will vary among individual farmers depending on the value of their homesites and whether they qualify for the homestead exemption, currently set at $20,000 for those 65 years of age and over.  The simulation model makes no allowance for homestead exemptions due to the difficulty of determining the number of farmers who qualify for a homestead exemption.
 1987 Assessed Values
The State Tax Commissioner's published reports do not distinguish between assessed values of owner occupied residences and farm real estate because both are categorized as Class 2 properties.  Since the two values are not shown separately, the assessed values of farm real estate were estimated by using data on the number of acres in farming, 1982 assessment/sales ratios for class 2 properties (Bowman 1983) and the average market value per acre of farm real estate reported in the 1987 Census of Agriculture.  The values obtained by this process were then adjusted using the U.S. Department of Agriculture's reported per acre tax rate for farmland in the state. The results of these estimation procedures are shown in Appendix A.
As Appendix A indicates, the simulation model estimates that the actual assessed value of West Virginia's farmland in 1987 was $238 million.  However, this figure may be somewhat inaccurate for two reasons.  First, the assessment/sales ratios used are for 1982, not 1987.  Thus, it can be argued that the resultant figure may be inaccurate if the ratios had changed significantly over the 1982-1987 period. However, there is no evidence to suggest that the ratios have changed significantly.  Second, it is generally recognized that assessment/sales ratios for residential properties are higher than assessment/sales ratios for farmland.  Since the assessment/sales ratio data used in the simulation model reflect the average ratio for all class 2 properties, the resultant figure may overestimate the actual assessed value of farmland in West Virginia.  However, using the U.S. Department of Agriculture's tax rate should have removed most of this upward bias.
 Assessed Values Using the Market Valuation Approach
Consequent to Senate Bill Number 10 (1982), the assessed value of a property was defined as 60 percent of the appraised value for each property (W.Va Code 11-1A-3a).  Further, it was specified that the "increased valuation of property be allocated over a period of 10 years in equal amounts annually" (W. Va. Code 11-1A-22).  As a result, to estimate the assessed value of West Virginia's farmland in 1987 using the market valuation approach is a two step process.  The first step is to take 60 percent of the average market values for farmland as reported in the 1987 Census of Agriculture.  Then, two tenths of the difference between the property's current assessed value and its value using the market value approach is added to the current assessment value.  This is done on the assumption that reappraisal values were to be used from the year 1986 as envisaged in the Tax Limitation and Homestead Amendment of 1982.
The simulation results using the market valuation approach are presented in Appendix A.  For step 1, the model suggests that West Virginia's farmland would have been assessed at $1.3 billion in 1987 (60% of total farm market value).  Then, using step 2 which phases in the increase in valuation over a ten year period, the actual assessment figure that would have been used in 1987 using the market valuation approach was $662 million.
 Assessed Values Using the Income Capitalization Approach
The Tax Commissioner currently determines the per acre use values of farmland for all 55 counties in West Virginia by using the income capitalization method and bases net farm income on farm rental values (W. Va. Code, 11-1A-10).  These use values are estimated on a per acre basis for three categories of farmland (tillable cropland, pasture and woodland) and for five sub-divisions (on the basis of soil quality and topography) in each category except for woodland.  Since land use data on such a detailed breakdown are not available, the simulation model used the average values of all 5 sub-divisions in the two categories of tillable cropland and pasture to represent the value of an acre in each category.  The use value of farm woodland was determined by the State Tax Department to be $10 per acre across all counties.  County farmland data by land use from the 1987 Census of Agriculture were regrouped to correspond to the three categories of farmland for which use values were available from the Tax Department.
The total use value of land for each category of farmland in each of West Virginia's county is indicated in Appendix B.  The use values were computed by multiplying the area of land in each category by the corresponding per acre use values.  The total value of all three categories was used to estimate the total appraised use value of farmland in each county.  Because the state legislature requires that use values be "considered its market value for appraisal purposes," 60 percent of the use value is used to represent the assessed value for tax calculations (W. Va. Code 11-1A-10a).
As Appendix A indicates, the total assessed value using the use value approach for all of West Virginia's farms would have been $340 million ($118.2 million for tillable cropland, $121.7 million for pasture land and $100.2 million for woodland).
 Tax Revenue
The average tax rate on West Virginia's Class 2 property in 1987 was $1.36 per $100 of assessed value.  This figure was used to estimate the total amount of taxes that would have been paid by farmland owners in each county under current assessment practices, using the market value approach and using the
use value income capitalization approach.  In addition, property taxes per acre of farmland were estimated by dividing the total amount of property taxes paid by the number of farmland acres.
As indicated in Appendix C, the simulation model suggests that under the current assessment approach, West Virginia collected approximately $3.24 million in property taxes on farmland in 1987.  It also suggests that West Virginia would have collected approximately $2 million in 1987 if it had used the use value income capitalization approach and $9 million if it had used the market value approach.
Appendix C also lists county by county 1987 property tax revenue estimates under current assessment procedures, the use value income capitalization approach and the market value approach. The magnitude of the impacts vary among the counties depending on the county's total tax base and the proportion of the total tax base eligible for use valuation.
  The simulation model estimated that under current assessment practices the typical farmer in West Virginia paid property taxes at the rate of $0.99 an acre in 1987. If West Virginia had used the use value income capitalization assessment approach, farmers in West Virginia would have paid only 60 cents an acre, or 40% less.  If the market value assessment approach had been used, the typical farmer would have paid $2.67 per acre, or 169% more.
 Redistribution of the Tax Burden
Because the implementation of use valuation for West Virginia's farm real estate will cause farm property taxes to fall, other classes of property will have to have higher assessed values to make up the revenue difference.  Thus, use valuation for farmland will redistribute the property tax burden away from farmland owners and toward the owners of other property.
Given the complicated nature of West Virginia's property tax structure (four classes of properties, each with its own tax rates) and the statewide reappraisal of all properties, it is difficult to assess the degree to which tax burdens will be changed due to the implementation of use valuation for farmland without using simplifying assumptions. If it is assumed that the use valuation of farmland had been implemented in 1987 without a simultaneous reappraisal of other classes of property and that a uniform tax rate of $1.36 per $100 was applicable to all property classes, then to maintain its property tax revenue West Virginia would have had to increase its average property tax levy rate from $1.36 to $1.37 per $100 of assessed value, an increase of only 0.7 percent.  The shift in the property tax burden toward other classes of property varies by county according to the amount of farm real estate in each county relative to its total tax base, ranging from 0.015 percent in Mingo County to 6.83 percent in Hardy County.
 A Case Study of Monongalia County
A more detailed and precise analysis of the operation and impacts of use value assessment was made through a case study of Monongalia County where actual farmland use value assessment data was available from the County Assessor's Office.
Although West Virginia has not implemented the farmland use valuation program, county assessors are required to receive applications annually for farm use valuation and to maintain appraised values for farmland at use valuation.  Data on farmland use valuation for 1988 were extracted from the records maintained by the assessor in Monongalia County and are shown in Table 3.  They include the following data for revenue districts:
  1. the number of acres qualified for farm use valuation in each category of farmland,

2. the appraised value of qualified farmland (land value and  building value) at use valuation,

3. the number of homesites (one acre per homesite) in  farmland area, and
 

  Table 3

 APPRAISAL VALUES OF FARMLAND, MONONGALIA COUNTY, 1988
 

                    Area and Appraisal Values of Farmland
         ????????????????????????????????????????????????????????
Revenue  Till Past-  Wood Waste  Total    Land   Building   Total
District Soil ure    land  land  Acres    Value  Value      Value
         ----------- Acres -----------    ------- Dollars -------               ??????????????????????????????????????????????????????????????????

BATTELLE  358  2959  3840   157    7314   219480    42700   262180
CASS      589  2016  1583    60    4248   219600    45500   265100
CLAY      938  4392  4221   152    9703   387650     9100   396750
CLINTON  1039  3655  2340   152    7186   456000   125800   581800
GRANT    1082  2861  1678    78    5699   377700    45600   423300
MORGAN    257  1185   443    46    1931   125000     9600   134600
UNION     158   901   456    45    1560    84900      600    85500

Total    4421 17969 14561   690   37641  1870330   278900  2149230
??????????????????????????????????????????????????????????????????

Source:  Monongalia County Assessor's Office.

4. the value of land and buildings in homesites appraised at market value.

There are a number of features in the farm real estate data which can have a bearing on the impact of use value assessments.  First, the total area of farmland for which applications for use value appraisal had been made was only about 38,000 acres. According to the 1987 Agricultural Census, there were 52,964 acres of land in farms in Monongalia County.  Thus, owners of only about 70 percent of the total farmland area applied for use value appraisal.  When the leniency of farm use value eligibility criteria and the absence of punitive conditions for converting the land to other uses is taken into consideration, one would expect a much higher participation of farmland owners in the program.
As indicated in Table 3, the relatively more valuable tillable soil land use category in Monongalia County represents only about 11 percent of the total farmland enrolled in the use valuation program there.  Pasture and woodland account for approximately 85 percent of the total farmland enrolled in the program.
As indicated in Table 4, farmland homesites, which are appraised at market values, account for almost 85 percent of the total value of farmland in Monongalia County.
 Assessed Values
The actual assessed values of farmland parcels which qualified for use valuation in 1988 were extracted from the land books maintained by the county assessor.  Estimates of the assessed values
 
  Table 4

 Appraisal Values of Homesites and Farmland,
 Monongalia County, 1988
 

                             Appraisal Values of Homesites
                     ?????????????????????????????????????????????
Revenue              No. Home   Land   Buildings  Total   Average
District               Sites  -----Value in Dollars-----  Per Site
??????????????????????????????????????????????????????????????????
BATTELLE                  54   253020  1429500   1682520     31158
CASS                      38   279000   924300   1203300     31666
CLAY                      93   425150  1912400   2337550     25135
CLINTON                   77   548500  2090900   2639400     34278
GRANT                     63   364500  1449700   1814200     28797
MORGAN                    34   318300   997500   1315800     38700
UNION                     31   296000  1015600   1311600     42309

Total                    390  2484470  9819900  12304370     31550
??????????????????????????????????????????????????????????????????
 
                                         Appraisal Values of
                                         Homesites and Farmland
                                -----------------------------------
                                Total    Total    Total     Combined
Revenue                         Area      Land   Buildings   Total
District                        Acres    -----Value in Dollars-----
???????????????????????????????????????????????????????????????????
BATTELLE                         7368    472500   1472200   1944700
CASS                             4286    498600    969800   1468400
CLAY                             9796    812800   1921500   2734300
CLINTON                          7263   1004500   2216700   3221200
GRANT                            5762    742200   1495300   2237500
MORGAN                           1965    443300   1007100   1450400
UNION                            1591    380900   1016200   1397100

Total                           38031   4354800  10098800  14453600
???????????????????????????????????????????????????????????????????

Source:  Monongalia County Assessor's Office.
 that would have resulted after reappraisal were made using the use value income capitalization approach and the market approach.
The market values of farmland were estimated by multiplying the number of farmland acres by the average per acre market value of land and buildings in Monongalia County.  The Census of Agriculture set this figure at $914 for 1987.  Sixty percent of this market value was then taken as the estimated assessed value. To meet the requirement of phasing in the increased assessed value over a period of ten years and assuming the program was to be started in 1985, the taxable assessment at market valuation was calculated by adding 3/10 of the increased assessed value to the actual current assessment (Table 5).
In computing the assessed value using the use value income capitalization approach, homesite values were taken separately since they were appraised using the market valuation approach.
The assessed values of farmland and homesites were then estimated by taking sixty percent of appraised values of farmland and homesites, respectively.  The total assessed values of both farmland and homesites are shown separately in Table 5.  Since the total assessed value of the farmland and homesite exceeds the current assessed value, the taxable assessed value was computed by phasing in the increase over a ten year period from 1985.
 Taxes
The levy rate on Class 2 property in Monongalia County for 1988 was $1.24 per $100 of value.  As indicated on Table 6, this figure was multiplied by the assessed values to determine the amount of property taxes paid per $100 of assessed value.  The amount of property taxes
  TABLE 5

 FARMLAND ASSESSED VALUES AND TAXES,
 MONONGALIA COUNTY, 1988
 

                                        After Reappraisal
                          --------------------------------------------------------
                  Esti-   All Farm  All Farm   Farm    Homesite  Total     Taxable
          Actual  mated   Assd at   Taxable    Assd    Assd at   Ass Val   Ass Val
Revenue  Current  Market  Market    at Mrkt    at Use  Market    Farm +    Farm +
District Ass Val  Value   Value     Value      Value   Value     Homesite  Homesite
???????????????????????????????????????????????????????????????????????????????????
          ------------------------------ (Dollars) ------------------------------

BATTELLE  825276  6734352  4040611   1789877   157308  1009512   1166820    927739
CASS      550679  3917404  2350442   1090608   159060   721980    881040    649787
CLAY      665873  8953544  5372126   2077749   238050  1402530   1640580    958285
CLINTON  1035448  6638382  3983029   1919722   349080  1583640   1932720   1304630
GRANT     555971  5266468  3159881   1337144   253980  1088520   1342500    791930
MORGAN    488062  1796010  1077606    664925    80760   789480    870240    602715
UNION     344190  1454174   872504    502684    51300   786960    838260    492411

COUNTY   4465499 34760334 20856200   9382709  1289538  7382622   8672160   5727497
???????????????????????????????????????????????????????????????????????????????????

Source: Author's Computations.

 Table 6

 Taxes Per $100 of Assessed Value and Per Acre,
 Monongalia County, 1988
 

                                   ----------  Taxes at $1.24 per $100   ----------
                                   ------------------------------------------------
                                   At Current  Assessed  Farm   Homesite   Farm &
Revenue                            Assessed    At Market at Use At Market  Homesite
District                           Value       Value     Value  Value      Combined
 

                                   ----------------------(Dollars)-----  ----------
BATTELLE                               10233     22194    1951     12518     11504
CASS                                    6828     13524    1972      8953      8057
CLAY                                    8257     25764    2952     17391     11883
CLINTON                                12840     23805    4329     19637     16177
GRANT                                   6894     16581    3149     13498      9820
MORGAN                                  6052      8245    1001      9790      7474
UNION                                   4268      6233     636      9758      6106

COUNTY                                 55372    116346   15990     91545     71021
 
 
 
 

                                                         Tax Per Acre
                                             --------------------------------------
                                                       --After Reappraisal----
                                              Current    At     Farm only   Farm +
Revenue                                       Actual     Mrkt   at Use      Home
District                                      Tax        Value  Value       Site
 

                                                ------------(Dollars)------------
BATTELLE                                        1.39     3.01      0.27      1.56
CASS                                            1.59     3.16      0.46      1.88
CLAY                                            0.84     2.63      0.30      1.21
CLINTON                                         1.77     3.28      0.60      2.23
GRANT                                           1.20     2.88      0.55      1.70
MORGAN                                          3.08     4.20      0.52      3.80
UNION                                           2.68     3.92      0.41      3.84

COUNTY                                          1.46     3.06      0.42      1.87
???????????????????????????????????????????????????????????????????????????????????

Source:  Author's Computations.
 paid on a per acre basis is also indicated on Table 6 under four different sets of assumptions:
1. Actual per acre tax rate paid by farmland owners in the year, which included farmland as well as homesites,

2. The per acre tax rate farmland owners would have paid on both farmland and homesite had the reappraisal been done at market valuation,

  3. The per acre tax rate farmers would pay on farmland alone, (not including homesite) had the reappraisal been done at use valuation, and

4. The per acre tax rate farmland owners would pay on both  farmland and homesite had the reappraisal been done with  farmland appraised at use valuation and homesite appraised  at market valuation.

 Effect on Farmland Owners
According to the records of the Monongalia County Assessor, the 38,000 acres of farmland which qualified for farm use valuation included 390 homesites.  The total assessed value of farmland that qualified for use valuation in the year was around $4.46 million and the tax on that land was about $55,300, or
approximately $1.46 per acre (Table 6).  The average varied among revenue districts, ranging from $0.84 per acre in the Clay District to $3.08 per acre in the Morgan District.
If Monongalia County's farmland had been appraised at use valuation in 1988, the total assessed value would have been approximately $1.28 million and the average per acre tax would have been $0.42.  However, this figure can not be compared with the actual per acre tax since it does not include the value of farmland homesites.  The average per acre tax rate among revenue districts ranged from $0.29 in Battelle District to $0.60 in the Clinton District.
A realistic assessment of the impact of use value assessment of farmland on farmland owners can be made only by comparing the current per acre tax with the per acre tax that would be paid on the total land area (both farmland and homesite) after use valuation.  After reappraisal, the average property tax rate on farm real estate (when both farmland and homesite are taken together) for Monongalia County is estimated to be around $1.87 per acre.  This is about 28 percent higher than the per acre tax actually paid on farmland, which was $1.46.  The rates varied among the revenue districts, ranging from $1.21 in the Clay District to $3.84 per acre in the Union District.
Had the reappraisal been implemented without use valuation of farmland, the typical farmer in Monongalia County would have had to pay $3.06 per acre compared to the $1.46 that actually was paid.  This represents more than a 100 percent increase in the per acre tax.  On the other hand, as a result of use valuation of farmland, a farmer's per acre tax (exclusive of the homesite) would have been reduced to $0.42, a reduction of about 70 percent from the current per acre tax.
 Revenue Implications
According to published State Tax Department data, in 1988 Monongalia County levied $13.9 million in taxes on a total assessed value of $696.1 million.  Of this, the gross assessed valuation on Class 2 property was $276 million.  This was comprised of an assessed value of $270 million of real estate and $6 million of personal property.  In the published statistics by the State Tax Department, the two components of the assessed value of real estate, i.e. farmland and owner occupied residences are not shown separately. It was found that the total current assessed value of about 70 percent of all the farmland (including homesites) for which use value appraisal has been applied for was $4.46 million.  The total tax on this farmland at the levy rate of $1.24 per $100 would have been about $55,300.
If the reappraisal had been implemented without use valuation the tax revenue from the total farmland would have been over $116,000, an increase of nearly 104 percent over the actual tax revenue of about $55,300.  The implementation of the use valuation program for farm real estate would have reduced the increase in revenue due to reappraisal and would have yielded a tax revenue amounting to about $71,000, an increase of about 28 percent over the actual revenue in 1988.
 Conclusions
The farm use valuation method as proposed for West Virginia does not contain any of the restrictive measures thought to make use value assessment more effective in preserving farmland.  Thus, the effect of the 1990 legislation is to subsidize farmland owners without assuring a greater level of farmland preservation in the long run.  Penalties for converting farmland that had received preferential tax treatment could be more effective in preserving farming operations.
Both the simulation for West Virginia and the case study of Monongalia County indicate that the implementation of use valuation could result in substantial decreases in taxes for farmland owners depending upon the situation and certain assumptions.  The average reduction is more than two-thirds over current tax levels in both the state as well as in Monongalia County.  But the case study also has shown that the requirement of appraising homesites situated on farmland at market values could result in tax increases over present levels and have different impacts between farmland owners who own residences on their farms and those who do not.
The simulation model also suggests that local government revenue would decrease under the use value income capitalization assessment approach.  Although property tax revenue collected from farmers would be reduced by as much as 70 percent, this amounts to a reduction in total property tax revenue of only about 1 percent.  Moreover, the assessment of homesites on farms at market values could more than compensate for the reductions in taxes due to use value assessment of farmland.
The various impacts of implementing use valuation assessments (tax burdens held by farmland owners, shifts in tax burdens among property classes, and local government revenue collections) will vary among the counties depending on the value of the farmlands in each county relative to its tax base.   Implementation of use value assessment in West Virginia will achieve the goal of reducing the tax burdens of farmland owners, if assessed values for real estate are based on 60 percent of fair market values as they are required to be under the legislation passed in 1990 (H.B. 4127 and S.B. 8).  The benefits to farmers would be accompanied by a reduction of revenue to local authorities and a shift of relative tax burdens to other property owners.  However, because the 1990 legislation requires the reappraisal of all real estate total property tax collections will rise, although the total amount of the increase that can occur each year is limited to one percent unless public hearings are held to justify larger increases.
  References

Aiken, J. David.  1989. State Farmland: Preferential Assessment  Statutes. Lincoln, NB: University of Nebraska-Lincoln,   Department of Agricultural Economics, RB 310.

Armentrout, W. W. and Tyler F. Haygood. 1953. Property Tax  Assessment in West Virginia. Morgantown, WV: West Virginia  Agricultural Experiment Station Bul. 358.

Bowman, John H. 1983. Property Tax Equity and Efficiency; Draft  Report to the West Virginia Tax Study Commission on Research  Issue No.4. Charleston, WV.

Colyer, Dale. 1983. Tax Structure in West Virginia with Emphasis  on Property Taxes. Morgantown, WV: West Virginia University,  Division of Resource Management.

__________. 1977. Taxation: A Land Use Issue in West Virginia.  Summary Report. Morgantown, WV: West Virginia University  Resource Management Series. RM No. 65.

Colyer, Dale, and Mary Templeton. 1977. Land Transfers, Values  and Assessment for West Virginia 1968-69. Morgantown, WV:  West Virginia Agricultural Experiment Station, Bulletin 651.

Hexem, Roger, et al. 1990. Agricultural Resources: Agricultural  Land Values and Markets. Washington, DC: U.S. Department of  Agriculture, Economic Research Service, AR-18.

Ferrise, Anthony, and Dale Colyer. 1984.  Real Property: Farmland  Rental Values in West Virginia and Property Tax  Implications. Morgantown, WV: West Virginia University,  Cooperative Extension Service, RD Publication No. 721.

__________. 1983. Real Property: Summary of Senate Bill No. 10,
The Property Tax Reappraisal Program in West Virginia. Morgantown, WV: West Virginia University, Cooperative Extension Service, RD Publication No. 720.

Hady, Thomas. 1970. "Differential Assessment of Farmland on the  Rural Urban Fringe." American Journal of Agricultural  Economics. Vol 52, pp. 25-32.

Keene, John C., et.al. 1976. Untaxing Open Space: An Evaluation  of the Effectiveness of Differential Assessment of Farms and  Open Space. Philadelphia: Regional Science Research  Institute.
 
 
 

Levy, Alan J. and Dale Colyer. 1975. An Analysis of the Ratios of  Assessment to Sales Values for Real Estate in West Virginia.  Morgantown, WV: West Virginia Agricultural Experiment  Station Bul. 640.

Musgrave, Richard A., and Peggy B. Musgrave. 1984. Public Finance  in Theory and Practice. New York: McGraw Hill Book Co.

State Tax Department.  1985. Legislative Rules: Approved Farmland  and Structures Situated thereon Valuation Regulations.  Charleston, WV: State Tax Department, Title 110 Series 1a.

U.S. Department of Commerce, Bureau of the Census. 1989. 1987  Census of Agriculture. Washington, DC: U.S. Government  Printing Office.
  Appendix A

 Farm Assessment and Market Values, West Virginia, 1987

             Asst/  Per Acre    Total    Current   Est Use   Est Assd   Taxable
             Sales  Farm Mkt  Farm Mkt   Assd Val  Value of   at Mkt     Ass at
            Ratios    Value     Value    Farmland  Farmland    Value    Mkt Val
County       1982     1987      1987       1987      1987      1987      1987
????????????????????????????????????????????????????????????????????????????????                                 (%)       ------------------------ (Dollars) -------------------
BARBOUR        21.3      538   44747612   4831431   3113123   26848567  12994707
BERKELEY       25.3     1498  120221990  15401879   6648403   72133194  38759570
BOONE          15.8     1265    3333275    267375    111750    1999965    821319
BRAXTON        14.3      407   28424066   2054059   2250950   17054440   6662601
BROOKE         12.7      704    9051328    586128    452317    5430797   2005774
CABELL         11.9      877   33241808   2006682   1600052   19945085   7153637
CALHOUN        26.6      446   15480660   2092809   1164432    9288396   5151964
CLAY           17.7      470    7524230    670965    435810    4514538   1968339
DODDRIDGE      16.3      548   31671660   2592276   1686832   19002996   7930584
FAYETTE        21.5      551   11675139   1277572    880196    7005083   3409141
GILMER         22.7      423   24423174   2801991   1748701   14653904   7366029
GRANT          19.4      617   73302685   7250599    5904271   43981611  20172899
GREENBRIER     25.2      711  136174275  17462574   9466105   81704565  43793647
HAMPSHIRE      16.2      780  107277300   8798195   6854522   64366380  26776414
HANCOCK        15.5     1065    8926830    702609    302209    5356098   2178147
HARDY          21.0      764  112801544  11941956   7295335   67680926  32486845
HARRISON       24.1      665   59495555   7236301   3321820   35697333  18610210
JACKSON        25.3      555   57667830   7410943    4287478   34600698  18592108
JEFFERSON      26.7     1684  139905036  18937125   7780750   83943022  46672320
KANAWHA        17.3      879   18783351   1649813    884155   11270011   4853618
LEWIS          24.1      496   37415264   4603693   2648322   22449158  11703495
LINCOLN        22.4      779   24728576   2800941   1042540   14837146   7398790
LOGAN           9.9     1053    4949100    248241    167052    2969460    985861
McDOWELL       41.6     1131    1035996    218224     38498     621598    469099
MARION         19.1      651   27047748   2627300   1298561   16228649   7378626
MARSHALL       13.4      577   40891990   2761846   3615499   24535194   9290660
MASON          17.7      749   92595874   8272034    5706019   55557524  24223081
MERCER         17.4      714   35238042   3120851   1853100   21142825   9133700
MINERAL        26.3      655   50004665   6680012   3640502   30002799  16521541
MINGO          12.8     1077     908988     58956     30244     545393    202159
MONONGALIA     17.9      914   48409096   4400685   2043391   29045458  12741274
MONROE         16.9      578   83094436   7082392   12115994   49856662  21205700
MORGAN         21.5     1271   27698903   3028586    877141   16619342   8088080
NICHOLAS       24.1      768   25969152   3182494   1408817   15581491   8123151
OHIO           16.4      966   21527310   1786077    826285   12916386   5407660
PENDLETON      15.0      545  100456035   7589771   8668962   60273621  24109448
PLEASANTS      16.6      627    9853932    832024    535637    5912359   2491074
POCAHONTAS     25.9      606   71835240   9413471   4339385   43101144  23504491
PRESTON        25.0      614   82981486  10533672   4861162   49788892  26554076
PUTNAM         19.4      741   41225535   4049901   2429428   24735321  11345267
RALEIGH        32.7      716   20813404   3441257   1169612   12488042   7942395
RANDOLPH       17.0      535   59789460   5176912   3715699   35873676  15306102
RITCHIE        22.7      456   34887648   4050424   2482964   20932589  10522115
ROANE          22.8      448   40139456   4611610   2860008   24083674  12138171
SUMMERS        32.6      568   34193032   5665788   2040616   20515819  13020707
TAYLOR         28.4      586   24510036   3536757   1550822   14706022   8509884
TUCKER         16.9      706   22678838   1936828   1070446   13607303   5787639
TYLER          17.1      421   20532170   1793015   1844834   12319302   5272661
UPSHUR         18.0      567   34080102   3093691   2104625   20448061   8997147
WAYNE          18.4      870   23253360   2181476   1114504   13952016   6213298
WEBSTER        33.2      849    9951978   1672109    308256    5971187   3837483
WETZEL         29.3      385   13943545   2077151    928244    8366127   4941592
WIRT           17.1      486   17800722   1535102   1298874   10680433   4571225
WOOD           17.5      797   56452307   4999835   2963077   33871384  14677600
WYOMING        11.3      928    5272896    304990    226105    3163738   1109417
STATE                    682 2290295670 238250634 150014438 1374177402 662084539
  APPENDIX B

 FARM LAND USES AND USE VALUES, WEST VIRGINIA 1987

                                                 Acre Per        Use Values
             Lands         Land Use 1987         Farm Use        of Farmland
           in Farms    ----------------------- ------------ ---------------------------
County        1987  Tillable  Pasture Woodland Til Pas Wood Tillable  Pasture  Woodland
              ---------- (Acres) ------------- ----------- (Dollars) ------------------
BARBOUR       83174    15275    48888    19011 148  56  10   2260700   2737728   190110
BERKELEY      80255    38229    26507    15519 222  92  10   8486838   2438644   155190
BOONE          2635      417     1324      894 222  64  10     92574     84736     8940
BRAXTON       69838     9998    36380    23460 148  56  10   1479704   2037280   234600
BROOKE        12857     4146     5060     3651 112  50  10    464352    253000    36510
CABELL        37904     6431    17832    13641 216  64  10   1389096   1141248   136410
CALHOUN       34710     7510    13931    13269 148  50  10   1111480    696550   132690
CLAY          16009     1840     6790     7379 148  56  10    272320    380240    73790
DODDRIDGE     57795     7702    29264    20829 148  50  10   1139896   1463200   208290
FAYETTE       21189     4828    10368     5993 154  64  10    743512    663552    59930
GILMER        57738     6737    30596    20405 148  56  10    997076   1713376   204050
GRANT        118805    14671    70092    34042 208  92  10   3051568   6448464   340420
GREENBRIER   191525    29706   115160    46659 182  86  10   5406492   9903760   466590
HAMPSHIRE    137535    27470    56217    53848 208  92  10   5713760   5171964   538480
HANCOCK        8382     3081     2640     2661 112  50  10    345072    132000    26610
HARDY        147646    23176    74312    50158 208  92  10   4820608   6836704   501580
HARRISON      89467    17792    54660    17015 148  50  10   2633216   2733000   170150
JACKSON      103906    20559    58097    25250 194  50  10   3988446   2904850   252500
JEFFERSON     83079    47018    26455     9606 222  92  10  10437996   2433860    96060
KANAWHA       21369     3125    11063     7181 222  64  10    693750    708032    71810
LEWIS         75434    11114    46213    18107 148  56  10   1644872   2587928   181070
LINCOLN       31744     3181    16520    12043 176  64  10    559856   1057280   120430
LOGAN          4700      399     3059     1242 176  64  10     70224    195776    12420
McDOWELL*       916      318      278      320 148  50  10     47064     13900     3200
MARION        41548     8554    21907    11087 112  50  10    958048   1095350   110870
MARSHALL      70870    14039    33990    22841 258  64  10   3622062   2175360   228410
MASON        123626    36537    55786    31303 154  64  10   5626698   3570304   313030
MERCER        49353     8442    25543    15368 154  64  10   1300068   1634752   153680
MINERAL       76343    13737    31514    31092 208  92  10   2857296   2899288   310920
MINGO*          844      137      356      351 176  64  10     24112     22784     3510
MONONGALIA    52964    12634    28313    12017 148  50  10   1869832   1415650   120170
MONROE       143762    28588    80616    34558 260 154  10   7432880  12414864   345580
MORGAN        21793     6468     5815     9510 134  86  10    866712    500090    95100
NICHOLAS      33814     7496    13344    12974 182  64  10   1364272    854016   129740
OHIO          22285     7466     9819     5000 112  50  10    836192    490950    50000
PENDLETON    184323    20131   105111    59081 208  92  10   4187248   9670212   590810
PLEASANTS     15716     2497     6903     6316 194  50  10    484418    345150    63160
POCAHONTAS   118540    15378    62998    40164 182  64  10   2798796   4031872   401640
PRESTON      135149    32607    56267    46275 148  50  10   4825836   2813350   462750
PUTNAM        55635     8913    27377    19345 236  64  10   2103468   1752128   193450
RALEIGH       29069     5805    15236     8028 154  64  10    893970    975104    80280
RANDOLPH     111756    15960    62452    33344 148  56  10   2362080   3497312   333440
RITCHIE       76508    12653    40677    23178 148  50  10   1872644   2033850   231780
ROANE         89597    12375    54074    23148 148  50  10   1831500   2703700   231480
SUMMERS       60199     8799    28370    23030 154  64  10   1355046   1815680   230300
TAYLOR        41826     8498    24843     8485 148  50  10   1257704   1242150    84850
TUCKER        32123     5271    15988    10864 148  56  10    780108    895328   108640
TYLER         48770     8487    23938    16345 202  50  10   1714374   1196900   163450
UPSHUR        60106    10020    33128    16958 148  56  10   1482960   1855168   169580
WAYNE         26728     3593    15742     7393 216  64  10    776088   1007488    73930
WEBSTER       11722     1433     3522     6767 154  64  10    220682    225408    67670
WETZEL        36217     4592    17913    13712 112  50  10    514304    895650   137120
WIRT          36627     6920    21089     8618 148  50  10   1024160   1054450    86180
WOOD          70831    14886    34301    21644 202  50  10   3006972   1715050   216440
WYOMING        5682      752     3921     1009 154  64  10    115808    250944    10090
STATE       3372938   648391  1722559  1001988             118216810 121787374 10019880
  APPENDIX C

 ESTIMATED PROPERTY TAXES UNDER DIFFERENT ASSESSMENT APPROACHES
 WEST VIRGINIA, 1987

              Taxes at $1.36/per $100          Tax Per Acre
            ?????????????????????????  ??????????????????????????
            Current Assd wth  Assd at  Current  Assd wth  Assd at
County     Assessed  Use Val  Mkt Val  Assessed  Use Val  Mkt Val
?????????????????????????????????????????????????????????????????
              -------------------- (Dollars) ------------------
BARBOUR       65707    42338   176728     0.79     0.51     2.12
BERKELEY     209466    90418   527130     2.61     1.13     6.57
BOONE          3636     1520    11170     1.38     0.58     4.24
BRAXTON       27935    30613    90611     0.40     0.44     1.30
BROOKE         7971     6152    27279     0.62     0.48     2.12
CABELL        27291    21761    97289     0.72     0.57     2.57
CALHOUN       28462    15836    70067     0.82     0.46     2.02
CLAY           9125     5927    26769     0.57     0.37     1.67
DODDRIDGE     35255    22941   107856     0.61     0.40     1.87
FAYETTE       17375    11971    46364     0.82     0.56     2.19
GILMER        38107    23782   100178     0.66     0.41     1.74
GRANT         98608    80298   274351     0.83     0.68     2.31
GREENBRIER   237491   128739   595594     1.24     0.67     3.11
HAMPSHIRE    119655    93222   364159     0.87     0.68     2.65
HANCOCK        9555     4110    29623     1.14     0.49     3.53
HARDY        162411    99217   441821     1.10     0.67     2.99
HARRISON      98414    45177   253099     1.10     0.50     2.83
JACKSON      100789    58310   252853     0.97     0.56     2.43
JEFFERSON    257545   105818   634744     3.10     1.27     7.64
KANAWHA       22437    12025    66009     1.05     0.56     3.09
LEWIS         62610    36017   159168     0.83     0.48     2.11
LINCOLN       38093    14179   100624     1.20     0.45     3.17
LOGAN          3384     2272    13408     0.72     0.48     2.85
McDOWELL       2968      524     6380     3.24     0.57     6.96
MARION        35731    17660   100349     0.86     0.43     2.42
MARSHALL      37561    49171   126353     0.53     0.69     1.78
MASON        112500    77602   329434     0.91     0.63     2.66
MERCER        42444    25202   124218     0.86     0.51     2.52
MINERAL       90848    49511   224693     1.19     0.65     2.94
MINGO           802      411     2749     0.95     0.49     3.26
MONONGALIA    59849    27790   173281     1.13     0.52     3.27
MONROE        96324   164778   288398     0.67     1.15     2.01
MORGAN        41189    11929   109998     1.89     0.55     5.05
NICHOLAS      43282    19160   110475     1.28     0.57     3.27
OHIO          24291    11237    73544     1.09     0.50     3.30
PENDLETON    103221   117898   327888     0.56     0.64     1.78
PLEASANTS     11316     7285    33879     0.72     0.46     2.16
POCAHONTAS   128023    59016   319661     1.08     0.50     2.70
PRESTON      143258    66112   361135     1.06     0.49     2.67
PUTNAM        55079    33040   154296     0.99     0.59     2.77
RALEIGH       46801    15907   108017     1.61     0.55     3.72
RANDOLPH      70406    50534   208163     0.63     0.45     1.86
RITCHIE       55086    33768   143101     0.72     0.44     1.87
ROANE         62718    38896   165079     0.70     0.43     1.84
SUMMERS       77055    27752   177082     1.28     0.46     2.94
TAYLOR        48100    21091   115734     1.15     0.50     2.77
TUCKER        26341    14558    78712     0.82     0.45     2.45
TYLER         24385    25090    71708     0.50     0.51     1.47
UPSHUR        42074    28623   122361     0.70     0.48     2.04
WAYNE         29668    15157    84501     1.11     0.57     3.16
WEBSTER       22740     4192    52190     1.94     0.36     4.45
WETZEL        28249    12624    67206     0.78     0.35     1.86
WIRT          20877    17665    62169     0.57     0.48     1.70
WOOD          67998    40298   199615     0.96     0.57     2.82
WYOMING        4148     3075    15088     0.73     0.54     2.66
STATE       3240209  2040196  9004350     0.99     0.60     2.67