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Grain bin tax tips

A conversation with…

Amanda Stacy and Kristi Kress Wilhelmy with Barrett, Easterday, Cunningham & Eselgroth LLP

 

OCJ: The Ohio Supreme Court recently ruled on a case involving metal grain bins and taxes. What is the background of the case?

Amanda and Kristi: The Metamora Elevator Company (“the Company”) filed complaints with the Fulton County Board of Revision after the county auditor assessed its metal grain bins as real property, requiring the Company to pay real estate taxes for the metal grain bins. The Fulton County Board of Revision upheld the auditor’s assessment, agreeing that the metal grain bins should be taxed as real property. The Company appealed to the Board of Tax Appeals which reversed, finding that the metal grain bins were personal property and should not be assessed as real property. The Fulton County Auditor and the Fulton County Board of Revision then appealed to the Ohio Supreme Court (Metamora Elevator Company v. Fulton County Board of Revision, et al., Case No. 2014-0874).

 

OCJ: What was your firm’s involvement?

Amanda and Kristi: Our firm filed an amicus curiae (“friend of the court”) brief on behalf of the Ohio AgriBusiness Association (OABA), encouraging the Ohio Supreme Court to rule that the metal grain bins are personal property and should not be taxed as real property. Many of OABA’s members commonly store grain, feed and agricultural inputs in concrete storage structures, as well as in temporary storage structures including corrugated metal or steel bins. Many OABA members will be impacted by this decision.

OABA’s brief addressed issues that were not addressed by other parties. The brief pointed out that unlike real property, metal grains bins can be moved from one location to another. Buying, selling, constructing and dismantling metal grain bins is a very well-known practice in the agriculture industry. We also attempted to give the Court perspective on the impact of its decision by noting that non-permanent grain bin capacity makes up over one-half of Ohio’s licensed grain storage capacity. At the time of filing OABA’s brief, Ohio had 385 commercial grain storage facilities that are state-licensed under Ohio Revised Code Chapter 926. These licensed grain storage locations have a storage capacity of 429,431,000 bushels of grain. Of that storage capacity, 225,146,213 bushels, or 52.43%, is non-permanent bin storage capacity. Many of these grain storage facilities have locations in more than one county, meaning their storage facilities could have been taxed differently in different counties. OABA’s brief additionally highlighted Ohio case law and portions of the Ohio constitution that support the taxing of metal grain bins as personal property.

Amicus briefs were also filed by the Central Ohio Farmers Co-Op and a joint brief by the Ohio Farm Bureau and the Fulton County Farm Bureau.

 

OCJ: What was the ruling from the Ohio Supreme Court?

 

Amanda and Kristi: The Ohio Supreme Court announced its decision on Wednesday, July 15. The Ohio Supreme Court unanimously affirmed the decision of the Board of Tax Appeals. The Court concluded that metal grain bins are “storage bins.” The General Assembly has expressly identified “storage bins” as business fixtures, meaning they are not real property, and should not be taxed as such.

 

OCJ: How will the ruling impact Ohio farms and agribusinesses?

Amanda and Kristi: We are hopeful that the ruling will bring consistency across the state regarding the taxation of metal grain bins for farmers and grain handling facilities. Some of Ohio’s larger farmers and grain handling facilities have metal grain bins in multiple counties, leading to the possibility that their metal grain bins in one county could be taxed as real property, while their metal grain bins in another county may not be taxed as real property.

 

OCJ: What advice do you have for farmers and agribusinesses regarding this decision?

Amanda and Kristi: Check your tax records to see whether you are being taxed for metal grain bins. If there is a discrepancy in the property tax records, other than a clerical error, a complaint can be filed with the Board of Revision on or before March 31 for each tax year.

 

 

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