Tulare County assessors say SGMA is changing farmland value; urge returns of property questionnaires

Tulare County assessor staff told an agricultural advisory committee that limits tied to the Sustainable Groundwater Management Act are changing how farmland is used and valued, and they urged landowners to return mailed property questionnaires so assessments reflect current leases, water access and income.

At a committee meeting, an assessor's office presenter said the county has nearly 20,000 agricultural parcels and that "about 72% of ag properties benefit from [the Williamson Act] program." The office said total assessed value of ag properties in the county was $7,400,000,000 for the current tax year and that Williamson Act contracts account for several billions in tax-relief value.

Why it matters: SGMA-driven allocations and reduced groundwater access can change a parcel's rental income and, therefore, its assessed value under the county's income-capitalization approach. County staff said their mass-appraisal system relies heavily on landlord and lease income and expense data and that low survey response rates limit the office's ability to reflect market conditions.

How valuations work: The assessor's presenter explained the county uses a computer-assisted mass appraisal model that converts net rental income into land value by dividing net income by a capitalization rate. Using the office's example, $150 net income per acre divided by a 6% cap rate yields a $2,500-per-acre valuation. The presenter also said the office uses a six-year rolling average for land rents to smooth year-to-year volatility.

Questionnaire and data needs: Staff said they mailed 15,000 ag property questionnaires this year (11,000 last year) but received a low rate of useful returns previously. "We really need to see those numbers increase," the presenter said, adding that the data helped produce about 3,000 land-value reductions in white areas in prior cycles. The office warned that certain costs — notably the tax or fee for water pumped from the ground — count as an allowable expense only if market evidence shows the landowner, not the lessee, pays them.

On water and leases: In response to questions, staff said whether pumping fees affect valuations depends on who pays in typical lease arrangements. "That's why the ag property questionnaire is so important," Lee Moore, chief appraiser, said, noting the office uses lease information to determine which expenses the market treats as owner costs.

Williamson Act and relative savings: Staff described the Williamson Act as a primary mechanism to reduce taxable land values and illustrated the gap between restricted (Williamson Act) values and open-market sales — for irrigated bare land they cited typical Williamson Act ranges of roughly $1,100–$2,600 per acre versus recent sales cited at $9,000–$30,000 per acre in different parts of the county.

Other topics: Presenters reviewed special rules for valuing trees and vines (production averages, tree age and economic life), said pistachio contributory values vary widely across the county, and described a parcel-level web map tying APNs to GSAs and irrigation district boundaries to better group lease and sale data by water access.

Next steps: Staff asked landowners to return questionnaires (the presenter referenced an encouraged return date of the 30th as stated during the meeting) and offered assistance with questions about the form. The committee set its next meeting for March 18 with an agenda-planning meeting on March 11.

The assessor's office urged landowners and leaseholders to provide detailed income and expense information so the county can apply income-based valuations that better reflect changing water availability and market conditions.