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Bill Detail: HB22-1301

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Title Controlled Environmental Agricultural Facility As Agricultural Property
Status Governor Signed (05/20/2022)
Bill Subjects
  • Agriculture
  • Fiscal Policy & Taxes
House Sponsors M. Soper (R)
Senate Sponsors K. Donovan (D)
C. Simpson (R)
House Committee Transportation and Local Government
Senate Committee Finance
Date Introduced 03/15/2022

A controlled environment agricultural facility (CEA facility) is
a structure of not less than 1,000 square feet and related equipment and
appurtenances that combines engineering, horticultural science, and
computer management techniques to optimize hydroponic plant growing,
plant quality, and food production efficiency from the land's water for
human or livestock consumption. The primary purpose of growing crops

in a CEA facility is to obtain a monetary profit from the wholesale of
plant-based food for human or animal consumption.
Commencing January 1, 2023, for property tax purposes:
  • The definition of agricultural and livestock products
includes crops grown within a CEA facility for human or
livestock consumption. Agricultural and livestock
products does not include marijuana and hemp, or any
other nonfood agricultural products.
  • The definition of agricultural equipment includes any
personal property used in connection with the operation of
a CEA facility for planting, growing, and harvesting crops;
  • The definition of agricultural land includes any land
underlying or integral to the operation of a CEA facility;
  • All other agricultural property does not include a CEA
facility that has been in production for at least 2 years; and
  • Agricultural equipment that is used in any CEA facility is
exempt from the levy and collection of property tax.
Under the bill, a CEA facility is valued for assessment purposes
based on the net operating income derived from the production and sale
of the crops grown within the facility and capitalized at the same rate as
irrigated agricultural land. The value so determined must be reduced by
25% to determine the actual value of the CEA facility for property tax
If the primary use of the CEA facility is not the growing of crops
for human or livestock consumption, then the property is classified and
valued for assessment purposes as other agricultural property.

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