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Nebraska ag producers pay nearly 50 percent more than the national average in property taxes

Nobody likes taxes, but Nebraska farmers and ranchers have even more to dislike than many others around the country.

According to a study by J. David Aiken, Nebraska agriculture property taxes are among the highest in the United States. Over the last three years, Nebraska farmers and ranchers have paid nearly 31 percent of their net farm income as property taxes (47 percent in 2017). Aiken, an agriculture and Water Law Specialist Department with the agricultural Economics University of Nebraska-Lincoln, said that when state and federal taxes are factored in, this represents an effective tax rate of more than 50 percent (over 60 percent in 2017.) Nebraska property taxes on agricultural land as a percentage of net farm income are 146 percent of the United States average (1950-2017 data). The twenty year average is 150 percent, the ten year average is 147 percent, the five year average is 164 percent and the three year average is 188 percent. Property taxes are the single largest tax paid in Nebraska accounting for 38 percent of total state and local tax collections.

The study revealed that sales taxes make up 29 percent of total taxes, and income taxes are 26 percent. Sixty percent of property taxes go to K-12 education funding. All property taxes fund local government—cities, counties, and local school districts. All income taxes and 84 percent of sales taxes are used to fund the state government. Currently with high ag land values across the state, 85 percent of state aid goes to non-agricultural areas and 15 percent is distributed across the board to all school districts. Two-thirds of Nebraska school districts (largely rural) receive little to no state aid.

In Nebraska in 2017, 42,502 farmers paid $686.5 million dollars in property taxes. On a per-farm basis, that breaks down to $16,151 each, second only to California with the average there being $17,229. The national average in 2017 was $4,902, according to data from the 2017 ag Census collected by Chris Clayton, DTN ag Policy Editor.

John O’Dea lives near McCook, Nebraska with his wife and sons. They are feeling the high tax rate, paying 9 dollars a year per acre of grass. More of his tax dollars are given to support Mid-Plains Community College than he can afford to give his own son, who is putting himself through Fort Hays State University in Hays, Kansas. This for him was a cheaper option than Southeast Community College in Nebraska.

“My sons were talking the other day and they agreed “The expense of being a Nebraskan is getting too high,” O’Dea said. “The state has turned into two liberal cities that expect the rest of the state to support them. Folks are having to work off the place to support the ranch. Who will feed and pay the taxes if they force everyone out. It is having a ripple effect on small towns and communities. Every ag producer that has to take a job in town is taking that job away from someone else. I’m 43 years old and I’m paying more for property taxes now than I did for rent when I started. Land in Nebraska is a liability.”

O’Dea feels that there will be some major changes made as producers attempt to refinance land and cattle in the next few years especially with land values going down. The O’Dea family is seriously considering moving their base of operation to a more ag friendly state in the near future.

“The death losses in Nebraska alone will more than offset what USDA estimated what the calf crop was set to increase in 2019. If calf and yearling prices are not considerably higher this fall, our supply and demand market is broken beyond repair. The cow calf expansion phase was at or near its peak, so these losses will pull us back into a shrinking phase in the cow calf sector,” O’Dea said.

Another Nebraska rancher, Karina Jones, said that on top of weather-related disasters, her state’s property taxes are overwhelming.

“Property taxes are like a second mortgage,” said Karina Jones.

The Jones Ranch in Custer County Nebraska has been hit hard by nature and in a way kicked repeatedly while they were down.

“Our situation is unique. We endured the hailstorm in August of 2017 we had to wean calves immediately and start feeding cows on August 13. We didn’t have a blade of grass left on this ranch,” she remembers. By early December of that year, they were running out of feed, and they were forced to send all of the mother cows to be fed by someone off the ranch. “We fed cows from Aug 13, 2017 to June 1, 2018,” Jones said.

Jones believes the state is taking advantage of ranchers like herself and her husband.

“You would think the government would value people like us. We have a particular skill set that can not be taught in a classroom. You can not learn how to be a rancher from Google. It is generations of DNA intelligence. When they put us out of business, it is all lost. Society won’t be able to get that back. We have a particular skill set to feed the world and I can not think of a more noble profession than that,” Jones said. “It doesn’t matter if you own the ground or lease it. The cost of these high taxes is carried by the producer, the cow/calf man or the yearling guy. With the poor cattle markets the last few years we cannot support this tax burden. I do not know the last time I bought my girls a special sports drink at the supermarket line or convenience store. I cannot afford extras!”

The Jones are not a multi-generational operation. “We do not have the working capital of the generations before us to lean on. It all falls squarely on our shoulders, just like many other operators around us. It is a big load to carry,” Jones said.

The Jones’ had insurance on their home but hay loss from the hail storm was not covered because hail is a non-covered peril. The same with destroyed grass, trees lost, poor weaning weights on the calves that the cows had at side and poor performing calves that they had in utero. “We just want to raise cattle and kids. That’s all. We don’t want to take from anyone else. We want to give back and better our communities. We want to contribute fairly to our tax commitments. We want to feed our neighbors with a high quality product that we are proud to feed our own families.”

Jones would like to see some producer support meetings where others like her could share ideas. “We all need some good education and a place to be positive and focus on solutions. And yet we need a safe place to be heard. The bankers need us to stay in business,” said Leah Peterson of Custer County, Nebraska. “And none of us want easy; we just want a fair shot. Taxes take that away. As someone says, it’s like paying taxes on a 401K every year.”

Jim Scott, branch president of Bruning State Bank in Broken Bow, Nebraska said, “High property taxes are definitely a major issue due to the current ag economy and high expenses. There has been a depreciation of land values in the last 12 months, due to more land being sold and less profitability, people are looking to reduce debt load.”

“We need to even the tax burden on all citizens, like with a sales tax increase; we are waiting on the legislature to help. Producers need to get involved and pay attention to how money is spent,” Scott said.

Ellen Degeneres: Can you hear me now?

It’s been a roller coaster of a week for us at our ranch in eastern South Dakota. From massive flooding to a viral blog post that has garnered millions of page views, I don’t think I could have prepared myself for the highs and lows of the last seven days.

While we contended with flooded pastures and a wet basement; some of our neighbors had it much worse. One of our friends had to evacuate her home with her family in the middle of the night. Another producer in our area lost 18 fat steers due to a lightening strike. And to top it all off three tornadoes touched down an hour from us in Sioux Falls, devastating homes and businesses in the urban area.

Of course, these events compounded the stress producers are already facing with ongoing trade wars, suspicions of cattle market manipulation, low commodity prices, rising debt loads and many of our acres sitting underwater and unplanted. In a nutshell, 2019 has been tough.

And to add insult to injury, there are celebrities, politicians and media pundits who currently think it’s trendy to blame climate change on cattle. It’s a myth our industry continues to battle, but it’s only gotten worse in recent years.

I was reminded of this ongoing challenge earlier this week when I watched a video of celebrity talk show host Ellen DeGeneres urging her fans to eat less meat for the planet, for our health and for the animals.

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After watching the video and seeing the millions of likes and comments that she proceeded, I sat down and penned a letter on my blog, BEEF Daily (www.beefmagazine.com), to share the facts about beef and nutrition, cattle and climate and who we are in rural America.

The blog is too lengthy for this column, but here is an excerpt: “We can’t eat our way out of climate change. I promise, I care about the planet as much as you. I want a future where my children and grandchildren will have access to an abundance of natural resources, including clean air, fresh water and nutritious food. And I believe farmers and ranchers can be part of the solution to address our planet’s climate concerns.

“Ellen, I know you want to do good in this world, and so do I! If you truly want to promote planetary health and adequate nutrition for all, please urge your fans to focus on reducing food waste! Did you know that 40% of all the food brought home in American goes uneaten? This is enough to fill a 90,000-seat Rose Bowl stadium every single day!

“I invite you and Portia to visit our ranch in South Dakota! Better yet, this farm girl would love to come visit you in Los Angeles and share some agricultural stories on your TV show! Could you find room in your programming for this cattle woman to come sit in your seat on air? I would be very grateful for the opportunity!”

If you feel so inclined, I would love for you to check out my original blog post and give it a share. I’m not overly optimistic that Ellen will call me; however, the blog continues to make the rounds on social media, and my phone has been buzzing with media requests. So even if Hollywood wants to ignore my message, other outlets and their listeners/viewers are getting to hear my message. I’m incredibly grateful for these opportunities and will continue to advocate as long as I have a platform to do so.

Now, I need your help in joining me in sharing our positive agricultural stories. We must contin-ue this momentum to change public perception about who we are and what we do in animal agriculture.

This issue isn’t going away. In fact, if you listen to some of the Democratic hopefuls for the U.S. presidential election, you’ll notice a common theme — the majority have platforms to address climate change, and guess who they are directing their policies, regulations and tax in-creases on to attempt to curtail emissions? You guessed it — America’s farmers and ranchers.

If that’s not a wakeup call, I don’t know what is! Let’s rally together, folks, and get to work! We can no longer sit idle and let others do the talking for us! Do you agree? Email me your thoughts at amanda.radke@live.com.

Varilek’s Cattle Call: Market Recovery Welcomed

Between trade deals, carcass weights, and cash cattle, the futures market is torn on which direction it wants to move. The recovery from contract lows is a small breath of fresh air as the fall drag continues. There is a gap in the cattle charts above current levels that appeals to the bulls. On the flip side, the bears are looking at an overbought market after an $8 rally.

The U.S. is said to be close on inking a new trade deal lowering tariffs on beef shipped to Japan. Australia is currently our biggest competitor in Japanese beef business. This will level the playing field significantly to improve our position for future beef sales on the world market. In other world market news, the China negotiations continue with the ups and downs of whether headway is being made or not.

Carcass weights for the week ending Sept. 7 showed steers up nine pounds and heifers up four pounds. Weather has been favorable for better than expected gains in the feedyards. This is our first large jump week over week in weights, but we have not eclipsed last year levels yet. I have been a broken record on the reasons why we need to stay current so I will not beat a dead horse.

Cash cattle trade had a slightly higher trade with 160-165 dressed sales across the Midwest. With the feedyards declining to take lower prices in previous weeks, the bids had to creep up to shake some loose. Colored cattle and heavier cattle were having a tougher time finding a cash bid. Packers seemed to be cherry picking quality cattle.

The cattle on feed report was neutral for “on feed” and “marketing” numbers, but placements of 91 percent was a little friendly. The market was anticipating the lighter placements so let us hope it was a surprise to some traders. There are many empty yards ready for cattle, so happy shopping my friends.

Scott Varilek, Kooima Kooima Varilek Trading

The risk of loss when trading futures and options is substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.

A Few Thoughts by John Nalivka on beef production, prices, and margins

Beef production will be up 1 percent this year from a year ago when it was up 3 percent – according to Nalivka. Perhaps that doesn’t provide much consolation to anyone dealing with lower fed cattle prices, although there was a time when the industry was pretty much in consensus that increased production led to lower prices – before the topic of margins. Digging into the numbers further does provide some insight.

Margin estimates are interesting but, they are only part of the analysis and the story. Taking a look at beef production by class of cattle can give a different view – similar to analyzing beef demand by primal rather than the entire carcass. USDA slaughter reports are much more reliable than cattle on feed reports and slaughter by class and weights are available weekly.

Digging into the numbers, year-to-date (YTD) through Sept. 6, steer slaughter was down 2 percent from the same period a year earlier. I have some concerns about this number but that is for another day and another discussion. Taking the YTD slaughter together with the YTD average steer carcass weight generates a figure for implied beef production from steers. The average weight for steers was down 5 pounds from a year ago and when combined with slaughter, yields a beef production estimate from steers through that was down 2 percent from a year ago.

The other half of the story, heifer slaughter YTD through Sept. 6, was up 7 percent from a year ago. Aside from beef production, that figure has implications regarding the size of the herd going forward and I have mentioned this numerous times. YTD carcass weights for those heifers through Sept. 6 were down 6 pounds from the prior year, leaving beef production from heifers up 7 percent and the highest since 2008!

So, when we combine the estimated production from steers with the production from heifers, the total is also the largest figure since 2008. Increased production – lower cattle prices – competitive markets. There is more to the story than just margins. As I have often said, there is more to a financial statement than just the bottom line margin. For true understanding, you need all of the numbers and the circumstances behind those numbers.

Prairie Memories by Gary Heintz: Grandma’s warm bread and hot coffee

Grandpa and Grandma Heintz had a good life, living in a new two story house in Marion, South Dakota, raising six kids and working a secure job. That all changed the day the land agent came to town.

The lure of owning land, farming and raising cattle, was irresistible to the several families that took the bait. Grandpa convinced grandma to sell the new house and buy land in Hughes County. He had made the trip out here and was sure they would have a wonderful life on the rolling prairie south of Harrold, even if it meant giving up his job and uprooting their family. They made the move in 1928, just before the Depression and Dustbowl hit.

The train stopped at siding #6, near the stockyards in Harrold. The family unloaded the freight car that held all of their belongings, then spent the night in the hotel. The next morning grandpa loaded grandma in their Model T and drove the ten miles south of town to see their new home. Grandma never got out of the car. The house was little more than a shack, with doors off their hinges, windows broken, and not a hint of paint on the wood. The final straw was a foot hanging out of a broken window. The owner of the foot was sleeping, if the sound of his snoring was any indication. Grandma insisted, and not gently I’m sure, to be driven back to the hotel. She never lived on the land they had been lured into buying.

The hotel was a blessing in disguise, a source of work as well as shelter during the early Depression years. Grandma managed the business, cooked for the tenants, washed the bedding, and always ran the land agent off when he came around.

Grandma baked bread daily, and in the springtime the smell of fresh bread wafted out the kitchen window. One day after taking the bread out of the oven, she went to the clothesline to hang up freshly washed sheets. When she came back, an elderly Native American woman was sitting in the middle of her kitchen floor. She made it obvious the smell of the fresh bread had drawn her to the hotel. Grandma, after getting over her surprise, sliced the warm bread, slathered it with butter and jam, and poured coffee for the two of them. Though neither understood the other, the Native American woman was able to tell grandma she and her family were on their way to North Dakota for powwows, and had camped outside Harrold to rest and buy supplies. They told each other through gestures and simple sign language about their families, with their shared interest in sewing and cooking occupying the remainder of the morning along with laughter and a blossoming friendship. This event was repeated that fall and the following powwow season, with the two pioneer women sharing their lives over fresh bread and coffee.

My memories of grandma are of a hard-bitten, feisty, no-nonsense woman who loved her dandelion wine and her family. She never forgave the land agent for moving her family out West. They soon had lost the land, became tenant farmers and later moved back to town when Grandpa took the rural mail route contract. He died at a young age, leaving Grandma a widow with nine children. She always made the best of things for the rest of her long life. Through all the hardships in her life, the early memory of her Native American friend was always as fresh as warm bread and hot coffee.

Impossible Burger enters retail as Tim Hortons limits Beyond Meat

In mixed news for the plant-based food industry, the Impossible Burger will be sold in grocery stores, just as Tim Hortons, the Canadian coffee and doughnut chain, announced it is pulling the Beyond Meat burger from its outlets in all provinces except Ontario and British Columbia.

The Impossible Burger will debut in all 27 outlets of Gelson’s Markets in Southern California today, Food Business News reported. The retail roll-out marks the first time that consumers will be able to buy the product, Food Business News said.

Le Journal de Montréal was the first publication to report that Tim Hortons would limit its Beyond Meat breakfast sausage and hamburger offerings.

Fortune said that Beyond Meat stock dropped about 3.8% on Wednesday, sliding by about 7% at one point, but regained some of those losses Thursday. The stock is up 241% since May when it opened at $46 a share, Fortune said.

The reasons Tim Hortons decided to limit its Beyond Meat offerings are unclear. The Saskatchewan Stock Growers Association objected to a commercial from A&W, which has the same parent company as Tim Hortons, showing football fans eating Beyond Meat patties. But some experts questioned whether Tim Hortons made a mistake promoting a single product rather than a product line, Fortune said.

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Bruce Friedrich

Meanwhile, the Good Food Institute said that a study it and the Plant Based Foods Association commissioned from SPINS showed increased demand for plant-based meat substitutes.

GFI said the data showed:

▪ Refrigerated plant-based burger sales in U.S. retail have surged 151% since 2018.

▪ Refrigerated plant-based burgers are a key growth driver within the plant-based meat market, with sales increasing more than five times as fast as other plant-based meat products.

▪ With refrigerated plant-based burgers driving sales growth, the plant-based meat market is now worth more than $800 million, with sales up 10% since 2018 and growing more than five times as fast as conventional meat sales, which have grown just 2% since 2018.

GFI Executive Director Bruce Friedrich said, “Impossible Foods’ retail debut will prompt a rapid acceleration in plant-based meat market growth. Impossible’s entry into retail will help expand and strengthen the plant-based meat market, giving consumers more choice and stimulating demand across the entire sector.”

“Products like the Impossible Burger have supercharged plant-based meat market growth by enticing more and more omnivores to embrace these products. By appealing to America’s meat-loving masses, Impossible Foods has helped propel plant-based meat into the mainstream, opening up and capturing entirely new consumers.”

“Increased availability is what will allow the plant-based meat sector to really break through. Adding exciting new products like the Impossible Burger to the meat case will accelerate this process. Impossible Foods’ entry into retail will create a much bigger plant-based market. Where plant-based meat is concerned, a rising tide will lift all boats.”

–The Hagstrom Report

Culvers supports US ranchers

Bucking to Vegas contestant list

6-9 year old BAREBACK – High Plains Circuit Finalists

Hayes Weinberger, Breien. ND

JD Chavez, Highmore, SD

Ryggan Lambley, Burke, SD

David Biggins, Gregory, SD

6-9 BAREBACK – High Plains Wild Card Contestant

Emmett Sprague

10-11 BAREBACK – High Plains Circuit Finalists

Aidyn Garwood, Butte, NE

Tyson Schmelzle, Gillette, WY

Lane Stuwe, Hoven, SD

Rope Reis, Reliance, SD

Talon Ping, Highmore, SD

Peter Jones, Annandale, MN

Taos Weborg , Saint Charles, SD

10-11 BAREBACK – High Plains Wild Card Contestant

Rowdy Mott, Watford City, ND

12-14 BAREBACK High Plains Circuit Finalists

Kashton Ford, Sturgis, SD

Tristan Spencer, Onida, SD

Taylon Carmody, Mobridge, SD

Tate Schlueter, Corona, SD

Devon Moore, Clear Lake, SD

12-14 BAREBACK – High Plains Wild Card Contestants

Kaktis Carlson, Mission, SD

Cash Schiley, Meadow, SD

Coy Hepper, Keene, ND

Cole Gerhardt, Mandan, ND

15-17 BAREBACK – High Plains Circuit Finalist,

Alex Nelson, Worden, MT

6-9 SADDLE BRONC – High Plains Circuit Finalists ,

Ryggan Lambley, Burke, SD

David Biggins, Gregory, SD

10-11 SADDLE BRONC – High Plains Circuit Finalists ,

Taos Weborg , Saint Charles, SD

Tyler Tvedt, Estelline, SD

Brody Froelich, Selfridge, ND

Bentley Dehning, Gregory, SD

Aiden Lane, Fort Yates, ND

10-11 SADDLE BRONC – High Plains Wild Card Contestant,

Raelee Riesland, Oshoto, WY

12-14 SADDLE BRONC – High Plains Circuit Finalists ,

Jackson Ford, Sturgis, SD

Curtis Riesland, Oshoto, WY

Taylon Carmody, Mobridge, SD

Ty Brenna, Keene, ND

15-17 SADDLE BRONC – High Plains Circuit Finalists ,

Sage Kvien, Valley City, ND

Brady Carlson, Mcleod, ND

Ty Fladeland, Stanley, ND

Ft. Pierre, host jr bucking finals

The 2019 High Plains “Buckin’ To Vegas” Circuit Finals for Jr Bareback & Jr Saddle Bronc riders will be Sunday, Sept. 29, in Ft. Pierre at the Casey Tibbs Arena starting at 11 a.m., CST following their High Plains Series awards ceremony. Finalists, between the ages of 6-17, who pre-qualified at events throughout the year or earlier that morning at the 9 a.m. Wild Card event will be competing for the Circuit Finals Champion titles and awards. Twenty two riders from the regional finals will have the opportunity to advance to Las Vegas, Nevada, Dec. 5-9 for the Junior World Finals aka JrNFR sanctioned by the Junior Roughstock Association.

The High Plains region has junior cowboys and one junior cowgirl competing from North Dakota, South Dakota, Nebraska, Minnesota, Wyoming and Montana and bringing sponsorships from eight states to support the regional event as well.

This is the third year for the finals in Fort Pierre. The two years prior, the riders traveled to Rock Springs, Wyoming, to qualify for the honor to ride at the Las Vegas Events JrNFR arena. The event is held in conjunction with Cowboy Christmas at the convention center downtown Las Vegas.

Last year, Hayes Weinberger, Breien, North Dakota, of the High Plains region won the PeeWee JrNFR Bareback Riding. Several other High Plains riders placed in rounds and also made the JrNFR Short Go as well in their events winning cash and prizes while in Las Vegas. For more information go to www.lazy3Srodeo.com who produces the youth roughstock series and finals for the High Plains region.

The public is invited to come cheer on the junior riders, free admission, thanks to sponsors. Concessions provided by Pizza Ranch.

– Buckin’ To Vegas Circuit Finals

Outtagrass Cattle Co. cartoon by Jan Swan Wood

Outtagrass Cattle Co. cartoon by Jan Swan Wood for the Sept. 21, 2019, edition of Tri-State Livestock News

Earl cartoon by Big Dry Syndicate

Earl cartoon by Big Dry Syndicate for the Sept. 21, 2019, edition of Tri-State Livestock News