Data supporting Real Estate Tax Calculations

Calculating taxes paid by average Mason County Farmland Acre

Assumptions

$113,818,147Assessed value for farmland  
$856.28Average Assessed farmland value per acre (Assessed value / total acres)
$0Tangible Personal Property value / current farmland acre

Mason County KY’s 2019 average property tax per farmland acre

Total Acres153,683
Total acres considered farmland132,921
Total annual Property Tax from farmland$1,289,962
Average Tax from a farmland acre (Total Tax from farmland / acres considered farmland)$9.23

This $9.23 payment from an average acre of ag land is divided as follows

Tax DistrictTax rate / $100
————-Real Property (Land)Amount Due on a $795.01 Acre
School Board0.546$4.68
County0.2290$1.95
State0.1220$1.09
Health0.0750 $0.64
Library0.0670 $0.57
Extension0.0400 $0.34
————-Current Farmland
Total TaxPayments
———————————–
Local Districts$8.18
State$1.05
All tax rates are 2020 rates

Calculating taxes due on Mason County Solar Acre

Assumptions

$650Annual Solar Lease rate paid to the landowner (net income)/ acre
7%Capitalization rate

First determine valuation of solar farm’s real property (land)

KY Dept of Revenue sways valuation of a utility-scale solar acre is determined based on the income approach.

  • The income approach is a real estate valuation method that uses the income the property generates to estimate fair value.
  • It’s calculated by dividing the net operating income by the capitalization rate.
  • $650 / 0.07 = $9,285.71 

Next, we calculate the annual amount due to each tax district

Tax DistrictTax rate / $100
————-Real Property (Land)Amount Due on a $9,285.71 Acre
School Board0.5460$50.70
County0.2270$21.08
State0.1220$11.33
Health0.0750 $6.96
Library0.0670 $6.22
Extension0.0400 $3.68
————-Solar Total Real Estate
Tax Payments
———————————–
Local Districts$88.64
State $11.33
All tax rates are 2020 levels
2020 tax rates
Solar-Farm-Assessment-Recommended-Guidelines_2_April-2020


This $14 Million increase means local tax districts receive 960% more revenue from these 6,000 acres than if there is no Solar, even with no tax on solar’s tangible assets.