State officials on Tuesday unveiled the final recommendations of a working group convened by Gov. Ned Lamont earlier this year to stave off a expected tax hike on many Connecticut farmers and come up with a way to overhaul the state’s process for setting farmland values.

The working group was asked to review and recommend changes to a decades-old state law known as Public Act 490, which aims to preserve farmland and open spaces by taxing those parcels of land according to their current use — rather than the fair-market value they could attract from developers.

Under the law, state officials are supposed to survey farmers every five years to come up with a new schedule setting the value of different types of farmland. Local assessors then use those values to calculate the owner’s property taxes.

When officials set out last year to conduct the regular revaluation, however, their efforts were plagued by low response rates and incomplete data. That, in turn, led to calculations that increased the value of the most productive types of farmland by over $1,000 per acre.

The biggest increases, however, came on the least valuable land — classified as swamp, ledge or scrubland — which saw its value increase by 2,325%. After many farmers protested the increases, Lamont cancelled the revaluation in January and assembled the working group to look into the issue.

“The the big issue was the lack of data,” said Ben Freund, the co-owner of Freund’s Farms in East Canaan and a member of the PA 490 working group. “They tried to construct the recommended… valuations based on a limited [set of] data that they had. In some of the categories, you’re talking about very, very few data points. So we ended up with some extreme perversions of the valuations based on that — because they had nothing better.”

In order improve data collection moving forward, the working group recommended requiring landowners who participate in the PA 490 program to report certain data on leases and land use to town officials annually, rather than on a five-year cycle. Farmers will also be able to report information about land that is rented out via barter or for free. That information had previously been left out of the state’s calculations for land values.

During revaluations, any increase of more than 20% for a particular type of land over the previous valuation will automatically be reviewed by a committee made up of farmers, municipal leaders and assessors.

Several of the group’s recommendations, including the annual reporting requirement, will require legislative action from lawmakers to take effect. Legislators are expected to take up the issue when they convene for their next session in January.

It will take at least two years of data collection under the new criteria before new land values for farmland are established, members of the working group said. Until then, local assessors will continue to utilize the 2020 values for tax purposes.

In a statement on Tuesday announcing the release of the working group’s final report, Connecticut Agriculture Commissioner Bryan P. Hurlburt  thanked members of the group, including several farmers, for their months of input. The group met more than a dozen times before voting unanimously to approve final recommendations on Tuesday, according to the meeting minutes.

The new recommendations, Hurlburt said, “honor the spirit and intent of the original PA 490 program.”

“Connecticut is committed to keeping land available for farming, and your contributions have helped shape a path toward that goal,” Hurlburt said. “These recommendations will serve as a strong foundation as the legislature and others consider how best to support the future of agriculture in our state.”  

Connecticut Farm Bureau President Paul Larson, who also served as a member of the working group, said the recommendations will ensure farmers have more predictability and stability in their annual tax bills.

“[Lamont] personally assured me that we’re not going rush this. We want to do this and do it right,” Larson said. “We’re not going to institute new values until we know that they accurately reflect the proper value for farmland and the various classifications.”

The group’s other recommendations included revising the existing system for classifying farmland — which dates back to soil surveys from the 1960s — with new categories that are based on common uses such as annual crops, orchards, woodlands and pasture. The final report also recommended continuing to use a calculation based on rental rates to determine the value of most agricultural land (with the exception of forest and woodlands, whose values have traditionally been determined by the state Department of Energy and Environmental Protection).

Another issue the working group identified with the prior land valuation process was that it took parcels containing several different types of land classifications — such as tillable land and swamps — and averaged out the lease payments across those classifications. But officials determined that renters were likely only paying for certain types of usable farmland, which skewed the results.

To address the issue, Hurlburt said the group recommended the reporting form be simplified to allow landowners to specify how their leased lands are being used.

Kim Grijalva, who operates a 100-acre cattle in North Stonington, was among the most vocal critics of last year’s revaluation effort before being appointed to the working group. After what she described as a slow start in several early meetings, Grijalva ultimately praised Hurlburt and Office of Policy and Management Undersecretary Martin L. Heft for facilitating the group’s discussions.

“Overall, I think the state had a bit of a come-to-Jesus [moment] and said, you know, ‘Farmers are watching, they’re listening, and we don’t want to go there again,’ right?’ Grijalva said. “They don’t want to be the bad guys.”

Norwich Assessor Bill Lee was one of two representatives of the Association of Assessing Officers to serve on the PA 490 working group. On Wednesday, Lee said he hoped the publicity surrounding the failed revaluation and subsequent working group would spark renewed interest in the PA 490 program and the need for accurate data.

“At the end of the day, we’re counting on the people that need to return those surveys — and do it accurately — to actually do so,” Lee said.