Tag Archives: ohio agricultural exemption from zoning

Wedding Barns: Exempt from Township Zoning or Not?

Written by Evin Bachelor, Law Fellow, OSU Extension Agricultural & Resource Law Program

The answer to the question in the title is still ‘it depends,’ but the answer is more likely yes when the barn is also a winery.  A recent court decision found that a barn in Medina County where weddings occur qualifies for the agricultural zoning exemption because of the barn’s use for wine production, marketing, and sales.

The decision represents the culmination of a battle between Medina County’s Litchfield Township and Forever Blueberry Barn, LLC that began in 2015.  The township filed suit that year, alleging that Forever Blueberry Barn was operating a rental facility for wedding receptions in violation of the township zoning ordinance.  At first, the trial court sided with the township and issued an injunction; however, Forever Blueberry Barn was able to lift that injunction by convincing the trial court that the agricultural zoning exemption’s vinting and viticulture provisions apply.

The first time the case went to the Ninth District Court of Appeals, the township won a brief victory when the appellate court ordered the trial court to review its decision and determine specifically whether or not the viticulture exception applied to the barn in question.  Essentially, the court of appeals believed that the trial court was convinced that the exemption should apply, but the trial court’s responsibility is to also explain why.

The second time on appeal, which resulted in the decision just recently issued, the Ninth District believed that the lower court appropriately examined and applied the agricultural zoning exemption’s vinting and viticulture provisions.  The Ninth District relied on case law from the Ohio Supreme Court instructing lower courts to “liberally construe” exemptions from restrictive zoning provisions.  The agricultural zoning exemption in Ohio Revised Code § 519.21 qualifies as an exemption from restrictive zoning provisions.  Specifically, it exempts “buildings or structures that are used primarily for vinting and selling wine and that are located on land any part of which is used for viticulture.”  That case, which is cited as Terry v. Sperry, 2011-Ohio-3364, is available here.

One of the big issues the second time on appeal involved what is known as the burden of proof.  The township argued that the barn owner had to prove that the barn’s primary use was vinting and selling wine by clear and convincing evidence.  This is a fairly high standard in civil cases, and courts often reserve the higher standard for accusations of things such as fraud or breach of fiduciary duties.  Essentially, the township wanted to see receipts and written business plans that the barn owner did not have.

However, the court said that determining the barn’s primary use must only be proven by a preponderance of the evidence, which asks simply whether it is more likely that the barn was used primarily for vinting rather than for some other purpose.

Here, the court was persuaded by testimony of the barn’s owner that the barn was primarily used for vinting and selling wine.  The member’s testimony included statements that:

  • Part of the barn will be used as a tasting room where wine will be sold directly to the public during established business hours;
  • The barn itself may be rented out for private events, including weddings, on the condition that a certain quantity of wine is purchased for the event;
  • Grapevines had been planted on the property and had started producing mature grapes.

As to this last point, the court noted that even one grapevine is sufficient to count as the growing of grapes.  The court again cited the Ohio Supreme Court’s Terry v. Sperry decision, which said that there is no minimum number of vines needed for a farm to qualify as engaging in viticulture.

It is important to note that this decision in Litchfield Twp. v. Forever Blueberry was not unanimous.  One judge dissented, believing that the primary use of the barn is as an event venue, with vinting activities being merely peripheral.  This dissent demonstrates the continued lack of a consensus on the application of this statute to wedding barns, even in cases with evidence of wine making activities.

What are our main takeaways from this case?

  • There is still no consensus on whether wedding barns are exempt from township zoning.
  • One producing grapevine can be sufficient to establish a viticulture activity.
  • Renting out barns for events must still be secondary to the barn’s vinting use.

The case is cited as Litchfield Twp. Bd. of Trustees v. Forever Blueberry Barn, L.L.C., 2019-Ohio-322 (9th Dist.), and the full text of the decision is available here.

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Ohio Legislature May Reconsider CAUV Bill

Written by:  Chris Hogan, Law Fellow, OSU Agricultural & Resource Law Program

The Ohio Legislature is once again considering a bill regarding Ohio’s current agricultural use valuation (CAUV) program. CAUV permits land to be valued at its agricultural value rather than the land’s market or “highest and best use” value. Senator Cliff Hite (R-Findlay) introduced SB 36 on February 7, 2017. The bill would alter the capitalization rate used to calculate agricultural land value and the valuation of land used for conservation practices or programs. The bill has yet to be assigned to a committee.

The content of SB 36 closely mirrors the language of a bill meant to address CAUV from the last legislative session: SB 246. Introduced during the 131st General Assembly, SB 246 failed to pass into law. SB 246 proposed alterations to the CAUV formula which are identical to those proposed by the current bill: SB 36. According to the Ohio Legislative Service Commission’s report on SB 246, the bill would have proposed changes that would have led to a “downward effect on the taxable value of CAUV farmland.” The likely effect for Ohio farmers enrolled in CAUV would have been a lower tax bill.

Due to the similarity between the two bills, the potential impacts of SB 36 on the CAUV program will likely be comparable to those of the previous bill. The proposed adjustment of the capitalization rate is likely to reduce the tax bill for farmers enrolled in CAUV. More specifically, the bill proposes several changes to the CAUV formula:

  • States additional factors to include in the rules that prescribe CAUV calculation methods. Currently, the rules must consider the productivity of the soil under normal management practices, the average price patterns of the crops and products produced to determine the income potential to be capitalized and the market value of the land for agricultural use. The proposed legislation adds two new factors: typical cropping and land use patterns and typical production costs.
  • Clarifies that when determining the capitalization rate used in the CAUV formula, the tax commissioner cannot use a method that includes the buildup of equity or appreciation.
  • Requires the tax commissioner to add a tax additur to the overall capitalization rate, and that the sum of the capitalization rate and tax additur “shall represent as nearly as possible the rate of return a prudent investor would expect from an average or typical farm in this state considering only agricultural factors.”
  • Requires the commissioner to annually determine the overall capitalization rate, tax additur, agricultural land capitalization rate and the individual components used in computing those amounts and to publish the amounts with the annual publication of the per-acre agricultural use values for each soil type.

To remove disincentives for landowners who engage in conservation practices yet pay CAUV taxes at the same rate as if the land was in production, the proposed legislation:

  • Requires that the land in conservation practices or devoted to a land retirement or conservation program as of the first day of a tax year be valued at the lowest valued of all soil types listed in the tax commissioner’s annual publication of per-acre agricultural use values for each soil type in the state.
  • Provides for recalculation of the CAUV rate if the land ceases to be used for conservation within three years of its original certification for the reduced rate, and requires the auditor to levy a charge for the difference on the landowner who ceased the conservation practice or participation in the conservation program.

To read SB 36, visit this page. For more information on previous CAUV bills, see our previous blog post.

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Agricultural Activities in Ohio can be Exempt from Local Zoning

Peggy Kirk Hall, Asst.  Professor, OSU Extension Agricultural & Resource Law Program

Spring brings an increase in agricultural land use activity and with it comes a surge of inquiries about Ohio’s agricultural zoning laws.  Here at OSU, we repeatedly hear a common question from agricultural landowners and local zoning officials:  can zoning regulate this agricultural situation?  That’s a question without a short and simple answer.   A review of Ohio Revised Code sections 303 and 519, which contain the “agricultural exemption” from county and township zoning authority, is the first step toward understanding whether a county or township can regulate an agricultural land use (note that different laws apply for cities and villages).   Here’s a summary of Ohio’s agricultural zoning laws:

Agriculture is exempt from rural zoning authority in many, but not all, situations.   While Ohio law grants counties and townships the authority to utilize zoning, the law limits how much authority these local governments have over agricultural land uses.  Generally, a county or township may not prohibit the use of any land for agricultural purposes in any unincorporated area, with a few exceptions that are noted below.  This exemption applies in any zoning district, whether residential, industrial, commercial, agricultural or otherwise.

An exempt activity must be in the definition “agriculture.”   Ohio agricultural zoning laws apply to “agriculture,” which the law defines to  include:  farming; ranching; algaculture; aquaculture; apiculture; horticulture; viticulture; animal husbandry, including, but not limited to, the care and raising of livestock, equine, and fur-bearing animals; poultry husbandry and the production of poultry and poultry products; dairy production; the production of field crops, tobacco, fruits, vegetables, nursery stock, ornamental shrubs, ornamental trees, flowers, sod, or mushrooms; timber and pasturage.  “Agriculture” also includes activities involving the processing, drying, storage, and marketing of agricultural products if those activities are conducted in conjunction with but secondary to actual production of those products.

Agricultural buildings and structures can also be exempt from zoning authority.   If a building or structure is directly related to an agricultural activity on the same parcel of land, then Ohio zoning law does not allow a county or township to require a zoning certificate or prohibit the construction or use of the building.  For example, local zoning cannot require a zoning permit or prevent the construction of a barn being built for housing cattle or storing farm machinery that is used for farming on the same property.  Also, zoning may not regulate or prohibit any building or structure that is used primarily for vinting and selling wine that is located on land where grapes are grown.

Special rules for farm markets.  Ohio law also says that local zoning cannot prohibit the use of land for a farm market in any industrial, residential, commercial or agricultural zoning district if 50% or more of the market’s gross income is from produce raised on farms owned or managed by the farm market operator.   But where necessary to protect public health and safety, local zoning may regulate the size of the farm market building, parking area size, set back lines and access to the market.  This provision is commonly known as the “farm market 50% test.”

Special rules for on-farm energy production.  Several energy production activities are not subject to local zoning if they occur on land qualified for CAUV (Current Agricultural Use Valuation).  These activities include biodiesel, biomass energy, electric and heat energy production, as well as biologically derived methane gas production of less than five megawatts.

Some agricultural activities can be regulated by local zoning.  There are a few exceptions to the agricultural exemption.  Local zoning may regulate agriculture in the following situations if the parcel of land is five acres or less and is located in a platted subdivision containing 15 or more lots:

  • On a lot that is one acre or smaller, zoning may prohibit or regulate all agricultural activities.
  • On a lot between one and five acres, zoning may regulate set back lines, height and size of buildings used for agriculture and may prohibit or regulate dairying and animal/poultry husbandry if 35% or more of the lots in the platted subdivision are developed.

Unfortunately, a summary of the zoning statute doesn’t answer all questions about agriculture and zoning.  Look for our future articles for continued analysis of Ohio’s agricultural zoning laws.  For additional zoning information, also see our zoning library, here.

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