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Abstract

This report summarizes the 2020 results of the North Dakota Land Valuation Model. The model is used annually to estimate average land values by county, based on the value of production from cropland and non-cropland. The county land values developed from this procedure form the basis for the 2020 valuation of agricultural land for real estate tax assessment. The average value for all agricultural land in a county from this analysis is multiplied by the total acres of agricultural land on the county abstract to determine each county’s total agricultural land value for taxation purposes. The State Board of Equalization compares this value with the total value assessed to agricultural property in each county. The average value per acre of all agricultural land in North Dakota increased by 3.04 percent from 2019 to 2020 based on the value of production. The formula cost of production index value used in the 2020 analysis was 214.46. The formula capitalization rate was 4.36 percent. The capitalization rate had a larger effect on higher valuations compared to recent years. Cropland value increased, on average, 3.34 percent. Across individual counties, the cropland valuation ranged from a decrease of 1.04 percent to an increase of 10,23 percent. County values had increases and decreases depending on crop mix and cropland to non-cropland percentages. Non-cropland values increased 5.37 percent. Generally, valuations for counties with a higher percentage of livestock increased partly due higher returns for the newest year entering the data set as compared to the oldest year of the data set that was replaced. Changes in market value are included for comparison. Market value data are from the annual County Rents and Prices survey conducted by the North Dakota Department of Trust Lands.

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