Tax assessment lowered due to proximity to hog farm

posted Nov. 14, 2016 9:18 a.m. (CDT)
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by / Jim Massey, Editor |

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    Argyle landowner Todd Knutson said his Green County property is worth less because of his proximity to a hog facility (in the background), and officials from the Wisconsin Department of Revenue agree with him. His tax assessment was lowered by 27 percent when he appealed a local decision to the DOR.

ARGYLE — A Green County landowner who lives adjacent to a confinement hog operation has successfully petitioned the Wisconsin Department of Revenue to lower his property tax assessment because of the land’s proximity to the hog farm.

Todd Knutson, who owns 22 acres in the town of Adams on the border of Green and Lafayette counties, has been tussling with the owner of the adjacent land, Evan Lemenager; the developer of the hog facility, Stately Investments of Strawberry Point, Iowa; and the facility’s manager, Badger Pork of Reedsburg, since the facility was populated with pigs in June of 2014.

Knutson claims the hog building was built closer to his home than the farm’s development plan prescribed, and that a “constant plume of foul air” has resulted in health problems for the occupants of his home. He also says the manure spread from the hog farm on nearby rocky ground has the potential to pollute his groundwater.

“The smell is so bad that I can smell it on the hair on my arms when I come in from outside,” Knutson said.

Knutson began action to contest his property value after he received a notice that his tax assessment had been increased because of a garage he built on his house. He first contested the assessment at an open book session in the town of Adams but was told the assessment would not be adjusted. His second step was to plead his case with the board of review, consisting of town officials and the assessor, but his request was denied there, too.

As a final recourse, Knutson took his case to the Wisconsin Department of Revenue, where he presented data and had a conference with DOR officials and the town’s assessor, Craig Galhouse. Knutson received a DOR order on Oct. 26 indicating that his appeal was successful and his assessment had been lowered from $220,700 to $161,800, or about 27 percent.

Mary Gawryleski, director of the DOR’s Equalization Bureau who signed the order, said property owners who are unsatisfied with the findings of their assessment appeal to the local board of review have two options: circuit court or the DOR.

For appeals determined to be valid, the DOR holds an informal conference where the property owner and assessor provide information. Property owners must bring evidence to show their assessment should be changed, which often consists of appraisals of their property or sales of comparable properties as evidence for their arguments.

Gawryleski said it was unique that an appeal regarding the impact of a large livestock farm on a neighbor’s assessed value reached the DOR level.

Scott Dye, field coordinator for a group known as the Socially Responsible Agricultural Project, said there have been dozens of cases in other states where a landowner’s property tax assessment had been lowered because of the proximity to a large livestock operation, but it was the “first case we are aware of” in Wisconsin.

Gawryleski said it is possible that property assessments have been lowered in the past by assessors at the local level, as it is a standard practice for assessors to account for the impacts that neighboring properties — farms or otherwise — have on a property’s assessment.

But to have the DOR lower an assessment due to a property’s proximity to a large livestock facility is “not a common occurrence,” Gawryleski said.

The Argyle farm is self-monitored by Badger Pork because it is under the 2,500 hog limit that would require DNR approval and regular review as a concentrated animal feeding operation.

Knutson said that’s part of the problem, as livestock facilities just under the CAFO limit have virtually no oversight.

Mark Beisbier, manager of the hog operation for Badger Pork, said Badger Pork is a family-owned farrow-to-finish operation that has 2,400 hogs in the facility. He said Lemenager, the landowner, is responsible for spreading the manure on his 148 acres that surround the 2.8-acre hog building.

“I don’t know what his expectations were when he moved out here,” Beisbier said of Knutson. “Things change, everywhere you live things are changing. Production on various things changes.”

Beisbier said he didn’t know if Knutson’s proximity to the hog facility had anything to do with the tax assessment being lowered.

Repeated calls to Lemenager went unanswered.

Dye said the Socially Responsible Agricultural Project, or SRAP, “doesn’t go looking for fights,” but only goes where it is asked for help.

“We respond to people’s requests for help, to stop a CAFO or get better regulation or enforcement of one that’s already in the community,” Dye said. The organization has active cases in “probably 30 to 35 states” across the country, he said.

Dye said to get a case to the state level as Knutson did “takes a tremendous amount of determination.”

“It shows how dedicated Todd is to rectify the situation,” Dye said. “It takes a lot of work and you have to know what you’re talking about. It’s not for everybody, but we do believe that for people in situations like Todd’s it’s an appropriate action to take.”

Dye, who lives near Columbia, Mo., said he visited Knutson’s farm and the day he was there the odor from the hog farm was “paint-peeling bad.”

Dye said when word gets out about Knutson’s tax assessment, he expects others who live near large livestock operations “to look at this as an option they need to pursue.”

“It should be a wake-up call to people in Wisconsin,” he said.

Landowners in some states take their grievances to court, Dye said, but that is difficult in Wisconsin because the state’s Right to Farm Law has a fee-shifting provision that requires complainants to pay the accused’s legal fees if they lose the case.

“If you say a neighboring farm is a nuisance and you lose that case, you have to pay your attorneys and their attorneys — that law has a very chilling effect (on the filing of lawsuits),” Dye said. “If you sue a large dairy operation, for example, unless you are willing to risk everything you own, it’s a pretty scary proposition for folks.”

Dye said he believes the problem in Wisconsin is there is very little enforcement of rules governing large livestock operations.

“There’s no cop on the beat, there’s nobody checking,” he said. “The political environment doesn’t allow (the DNR) to do their job. They are understaffed and politically hamstrung.”

Knutson said the 100-by-200-foot hog barn was built 893 feet from his residence, contrary to the hog farm plan book that showed the barn being 1,140 feet from his house.

Craig Galhouse, an assessor with Wisconsin Assessment Services of New Glarus, had provided the original assessment that Knutson appealed. He said the local board of review wasn’t able to do much with Knutson’s situation “based on the information given,” although board members were “sympathetic to the cause.”

“When he presented his appeal to the DOR he did a pretty good job of convincing them that there needed to be an evaluation change based on economic obsolescence,” Galhouse said. Economic obsolescence refers to when some other force — in this case the livestock operation — negatively impacts the value of a nearby property.

Galhouse said when the assessment was completed, there was no adjustment made for economic obsolescence. He said he didn’t think the board of review had enough time to research the issue before it was required to render a decision.

“Todd took the information from the board and came up with more information and a better appeal when he presented it to the Department of Revenue,” Galhouse said. “He presented similar cases from Iowa and Illinois and did a good job of getting the data together.”

Galhouse said this is the only assessment case he has ever dealt with concerning proximity to a confinement livestock operation. He said he interviewed landowners slightly further away from the hog facility than Knutson and the odor problem was “not anywhere near the same significance as at Todd’s.”

Mike Koles, executive director of the Wisconsin Towns Association, said he wasn’t familiar with the case, but if Knutson’s tax assessment was indeed lowered because of the proximity to the hog facility, “it has the potential to open up a can of worms.”

“We’ve got to look into it a little more, but it has the potential to have broad implications across the state,” Koles said. “I’d be really concerned that we have all these people around farms who are going to make challenges to their assessments.”

Tanya Gratz, a technician in the Green County Land Conservation Department, said when the hog facility was built, it was scored within Wisconsin’s livestock-facility siting rule, and passed the test.

“When it was built, it ended up being closer to his house, and they re-ran the (odor) score and it passed again,” Gratz said. “In our eyes it’s OK. Unfortunately, I know (Todd) is not happy about it. It has been suggested that maybe he move, but he doesn’t want to hear that.”

Gratz said large livestock facilities generally self-monitor and report their data, so the only time the county land conservation department gets involved with monitoring is if there is a complaint.

“All nutrient-management plans are really that way,” she said. “As far as day-to-day, nobody is really out there checking odor or anything.”

Knutson said the odor test is so easy to pass that the hog barn could theoretically be 10 feet from his house and still receive a passing score.

Lemenager’s application for a permit used 1,140 feet from the nearest neighbor to obtain a separation score of 730, even though the barn is actually 893 feet from Knutson’s residence. When entered into the odor management worksheet, the farm received an odor management score of 720. A score of 500 or less requires local government approval.

Knutson said even if the distance between his house and the hog farm was zero, it would still pass the odor test with a score of 505.

“The odor score methodology appears to be flawed,” he said.

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