CAUV

The purpose of this repository is to have open source documentation of the calculation for Ohio’s Current Agricultural Use Value (CAUV) Program. Secondarily, this repository produces projections for future CAUV values for soil types in Ohio. Likely of most interest is the current projections for CAUV that you can find by clicking that link. A more dynamic version with descriptions is available at Ohio CAUV Value projections for 2020, 2021, and 2020 – with the PDF version also available. There is an accompanying slideshow for the projections for 2020, 2021, and 2020. Previous versions for the Ohio CAUV Value Projections for 2019 and 2020 and its PDF version also available.

The calculations and projections for each soil type in Ohio are based on the 2017 formulation which substantially changed the methodology for CAUV values from previous years. The Ohio Department of Taxation (ODT) provides an overview of the caclulation for CAUV values which are used within this repository.

Current projections:

Recommendations for altering the calculation procedure for CAUV calculations presented on 2020-01-08:

Presentation (and in PDF format)
Write-up (and in PDF format)

Components:

An oversimplified description of how to calculate the CAUV value for a particular soil type is that it is the expected net returns from farming corn, soybeans, and wheat on an acre of land divided by capitalization rate to give a present value for owning a piece of land for commercial agricultural production. Please read the CAUV formula description for a more in-depth understanding of the program. The following pages provide description of the data involved with each component:

The usdarnass package is used for updating official USDA data and is not on CRAN. To install, a user must run the following command in R:

devtools::install_github("rdinter/usdarnass")

Afterwards, the user must register a NASS API Key through USDA and install the key on their local machine with the set_nass_key("YOUR_KEY_IN_QUOTATIONS") command with the nassR library.

Organization:

The structure of the repository is as follows:

0-data/
- 0-data_source.R - script to download data and create .csv and .rds files in an easy to read and uniform format. Some of these data are not online and cannot be downloaded. For those data that cannot be downloaded, they reside in this repository.
- data_source/ - most of this will be ignored via .gitignore.
  - raw/
    - All downloaded files from the 0-data_source.R script.
    - Some data cannot be downloaded and must be hosted elsewhere. They will also be in this folder for local use.
  - various_names.csv
  - various_names.rds
- .gitignore - any large files will not be loaded to GitHub.
1-tidy/
- 1-tidy-cauv.R - script to gather and format data in a usable way by each component
- ohio_cauv_all - as .csv and .rds but these are all of the components joined together which is a large amount of variables.
- component/
  - Properly formatted and gathered data for further analysis on a particular component of the CAUV calculation (prices, yields, harvested acreage, capitalization rate, and non-land costs).
2-calc/
- component/ - projections for each component in the CAUV formula.
  - 2-calc_component.R - each component.
3-proj/
- project/ - depends on different calculation scenarios one wants to utilize in calculating CAUV.
  - 3-project_proj.R - projected calculation of CAUV based upon the project at play. These will include high and low based on the Olympic averaging component of the CAUV calculation. Other projections place restrictions on how one would anticipate trends in particular components.
4-presentations/

Years Used in CAUV Calculation

All categories are Olympic averages with the exception of rotation and yields.

Tax Year	Capitalization Rate	Yields	Prices	Non-Land Costs	Rotation
2005	1999-2005	1984	1997-2003	1998-2004	ad hoc
2006	2000-2006	1995-2004	1998-2004	1999-2005	ad hoc
2007	2001-2007	1996-2005	1999-2005	2000-2006	ad hoc
2008	2002-2008	1997-2006	2000-2006	2001-2007	ad hoc
2009	2003-2009	1998-2007	2001-2007	2002-2008	ad hoc
2010	2004-2010	1999-2008	2002-2008	2003-2009	2004-2008
2011	2005-2011	2000-2009	2003-2009	2004-2010	2005-2009
2012	2006-2012	2001-2010	2004-2010	2005-2011	2006-2010
2013	2007-2013	2002-2011	2005-2011	2006-2012	2007-2011
2014	2008-2014	2003-2012	2006-2012	2007-2013	2008-2012
2015	2009-2015	2005-2014	2008-2014	2009-2015	2010-2014
2016	2010-2016	2006-2015	2009-2015	2010-2016	2011-2015
2017	2011-2017	2007-2016	2010-2016	2011-2017	2012-2016
2018	2012-2018	2008-2017	2011-2017	2012-2018	2013-2017
2019	2013-2019	2009-2018	2012-2018	2013-2019	2014-2018
2020	2014-2020	2010-2019	2013-2019	2014-2020	2015-2019
Future Years	current to 6 years ago	previous to 11 years ago	previous to 7 years ago	current to 6 years ago	previous to 5 years ago
Averaging	7 Olympic	10 Average, lagged	7 Olympic, lagged	7 Olympic	5 Average, lagged

Sources and timing of release:

Capitalization Rate - interest rates come from Ohio Department of Taxation while the equity rate comes from USDA-ERS which has updates each year in February (should be considered “official”), August, and November.
- USDA data files, should select the Farm Income Statements and then returns to operators
Crop Production Reports affects yields and rotation. Typically there is an August, September, October, and November forecast. Then finalized values occur in January of the following year. The USDA Quick Stats API will incorrectly place the most recent forecast value for the current year in the “YEAR” reference period. This needs to be accounted for.
Prices are for the marketing year period which are published by the USDA-NASS and have monthly prices. However, the official values come out around March each year.
Non-Land Costs maintained at the Ohio State Extension website and there will usually be an initial estimate for the budgets in October of that year with the final update usually around May.

Typical timeline, using Tax Year 2019 as example:

Month	Release	Notes
May 2018	Crop	Wheat acres/yield forecast for 2018 value (used in 2019 formula)
June 2018	Crop	Corn, soybeans, and wheat acreage report plus wheat yield update
July 2018	Crop	Wheat acres/yield forecast
August 2018	Crop, ERS	Corn, soybeans, and wheat acres/yield forecast
September 2018	Crop	Corn, soybeans, and wheat acres/yield forecast
October 2018	Crop, Budgets	Corn and soybeans acres/yield forecast; Ohio State Extension releases first budget report
November 2018	Crop, ERS	Corn and soybeans acres/yield forecast
December 2018	Crop
January 2019	Crop	Finalized corn, soybeans, and wheat acres/yield
February 2019	ERS	ERS finalizes the value for return to equity
March 2019	Prices	First published marketing year price data on corn, soybeans, and wheat for 2018
May 2019	Budgets	unofficial, there is no hard date for this but usually the
August 2019	ODT Official Values; FCS Interest Rate for Cap Rate	Rough estimate
November 2019	Prices	Official marketing year price data on corn, soybeans, and wheat for 2018