24. The County Board is required to hear and determine the complaint of any person relative to any property assessed or valued. Wyo. Stat. § 39-13-102(c)(iv).

25. Our inquiry is limited to whether the 2002 value affirmed by the County Board is: (a) arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law; (b) in excess of statutory jurisdiction or authority; (c) without observance of procedures required by law; or (d) unsupported by substantial evidence. Rules, Wyoming State Board of Equalization, Chapter 3, § 9.

26. All taxable property is to be valued at its fair market value. “[T]he department shall prescribe by rule and regulation the appraisal methods and systems for determining fair

market value using generally accepted appraisal standards.” (emphasis added) Wyo. Stat. § 39-13-103(b)(ii).

27. The Assessor followed the rules of the Department and applied the trending factor, the reported cost of equipment and depreciation rate to derive a value using the cost method.

28. The rules of the Department require the value of personal property should reflect the trade value and include factors such as value in place and usefulness to owner and actual income produced. Rules, Wyoming Department of Revenue, Chapter 9, §6

29. The Wyoming Department of Revenue rules provide:

The cost approach is a method of estimating value... . The approach may also be used to establish value for personal property through the process of cost estimation. The cost approach relies on the principle of substitution in which an informed buyer will not pay more for a property than its comparable replacement.

Rules, Wyoming Department of Revenue, Chapter 9, §6(b).

30. To calculate the cost value using the Department’s rules, one must have:

(ii) Accurate, pertinent physical data regarding the property to which cost data may be applied;

(iii) Current cost data which considers appreciation in the case of real and personal property;

(B) Typical reproduction and replacement costs may be estimated by the quantity survey method, the unit-in-place method, the comparative unit method, or the trended original cost method

(iv) Depreciation in the case of real and personal property. For personal property:

(A) The Ad Valorem Tax Division shall provide depreciation factors for use by property tax appraisers. ....

Rules, Wyoming Department of Revenue, Chapter 9, §6(b).

31. The economic lives for equipment are developed by the Department from IRS Publication 534 and 946, Marshall Swift Valuation Service, Assessor’s Committee Recommendations and other valuations systems and information. Rules, Wyoming Department of Revenue, Chapter 9, §6(b)(iv)(B).

32. According to the Department’s rule:

(H) “Trended original cost method” means the procedure... For personal property, acquisition or original costs shall be trended to reflect current replacement costs by application of a cost trend factor developed annually by the Ad Valorem Tax Division. The result is replacement cost new, or rcn. Trending of acquisition or original costs shall cease when the residual value has been reached except when refurbishing or maintenance changes the effective age.

Rules, Wyoming Department of Revenue, Chapter 9, §6(b)(v)(H).

33. All property in Wyoming must be uniformly assessed, and the selling price may not be the best evidence to establish fair market value. Gray v. Wyoming State Board of Equalization, 896 P.2d 1347, 1351 (Wyo. 1995). The court found that using the sales price of a particular piece of property to value that piece of property violates the constitutional test of equality. Gray v. Wyoming State Board of Equalization, supra, at 1352. As the court observed:

Reliance upon actual sales prices, in lieu of the methods adopted by the State Board, may well lead to discrimination and lack of equality and uniformity. While one method of arriving at assessed valuation, the sales comparison approach, may rely upon actual sales, it is not limited to the sale price for the particular property involved. We hold the Assessor followed a valuation method properly adopted by the State Board in this case. It was applied uniformly to all properties and, like the district court, we do not perceive any arbitrary, capricious, or unlawful action by the Assessor, nor is there any abuse of discretion.

Gray v. Wyoming State Board of Equalization, 896 P.2d 1347, at 1351.

34. An Assessor’s valuation is presumed valid, accurate, and correct, a presumption which survives until overturned by credible evidence. Teton Valley Ranch v. State Board of Equalization, 735 P. 2d 107,113 (Wyo. 1987). A mere difference of opinion as to value is not sufficient to overturn this presumption. J. Ray McDermott & Company v. Hudson, 370 P. 2d 364, 370 (Wyo. 1962).

35. One question before the State Board is whether there is substantial evidence in the record that reasonably supports the conclusions reached by the County Board. As a reviewing body, we will not substitute our judgment for findings reasonably supported by evidence in the County Board record. Laramie County Board of Equalization v. State Board, 915 P.2d 1184, 1188, 1189 (Wyo.1996); Amax Coal v. State Bd. Of Equalization, 819 P.2d 825 (Wyo. 1991); Sage Club, Inc. v. Employment Sec. Comm'n., 601 P.2d 1306, 1310 (Wyo. 1979). While substantial evidence may be less than the weight of the evidence, it cannot be clearly contrary to the overwhelming weight of the evidence. As the Wyoming Supreme Court has stated, substantial evidence ". . . is more than a mere scintilla of evidence or suspicion of a fact to be established." Mountain Fuel Supply Company v. Public Service Commission of Wyoming, 662 P.2d 878, 882 (Wyo. 1983). “Substantial evidence is relevant evidence which a reasonable mind might accept in support of the conclusions of the agency.” Amax Coal v. State Board Of Equalization, 819 P.2d 825 at 828 (Wyo. 1991).

36. The Wyoming Supreme Court has held that “an agency’s action is arbitrary and capricious and must be reversed if any essential finding is not supported by substantial evidence.” Amax Coal West, Inc., 896 P.2d 1329, 1335 (Wyo. 1995); citing, Majority of working interest owners in Buck Draw Field Area v. Wyoming Oil and Gas conservation Commission, 721 P.2d 1070,1079 (Wyo. 1986) and Amax Coal v. State Bd. Of Equalization, 819 P.2d 825(Wyo. 1991). “Substantial evidence is that quantum of relevant evidence which would be accepted by a reasonable mind as adequate to support the conclusion.” Gray v. Wyoming State Board Of Equalization, 896 P.2d 1347 (Wyo. 1995).

37. The Assessor used the personal property schedules as developed by the Department to value Petitioner’s property. The schedules were developed with publicly available information and these schedules were uniformly applied in the county and throughout the state of Wyoming. This results in uniformity and equality as demonstrated by the Assessor’s Exhibit G.

38. The Assessor complied with the rules of the Department. If rules have been properly promulgated pursuant to statutory authority they have the force and effect of law. Department of Revenue v. Buggy Bath Unlimited, Inc., 2001 WY. 27, 18 P.3rd 1182 (Wyo. 2001). Therefore, the Assessor complied with the law.

39. The price assigned to the property by the Petitioner is flawed for several reasons. The value is arbitrary as observed by the Petitioner’s agent. Arbitrary prices do not reflect fair market value. This was not an open market sale so there is no evidence the sale price reflected fair market value. The consideration recited in the sale agreement is more than the $28,500.00 and includes a lease agreement, a portion of net sales and other terms.

40. Petitioner introduced two letters that were not supported by testimony or other evidence. These letters were hearsay. The letters stated that restaurant equipment depreciates at a faster rate than set by the Department and the residual value is less than allowed by the Department. The writers had never viewed the equipment and did not present underlying evidence to support their conclusions. The County Board was not arbitrary and capricious by rejecting such information. As the Wyoming Supreme Court observed in Wyoming Department of Employment, Unemployment Insurance Commission v. SF Phosphates, LTD., 926 P.2d 199, 202 (Wyo. 1999):

With regard to the claimant’s alleged threat against the human resources manager, the commission was justified in accepting the claimant’s first-hand testimony over the second-hand hearsay testimony presented by Lake on behalf of SF Phosphates. See City of Casper, 851 P.2d at 4. The agency is charged with determining the credibility of the witnesses and the ultimate weight to be assigned to the evidence.

Also, hearsay evidence was rejected in Story, M.D. v. Wyoming State Board of Medical Examiners, 721 P.2d 1013, 1018 (Wyo., 1986):

Where hearsay evidence is by statute admissible in administrative proceedings, it is often held that it must be probative, trustworthy and credible; and, although it may not be the sole basis for establishing an essential fact and is insufficient to support an administrative decision, it may be considered as corroborative of facts otherwise established.

41. The concept of residual value for equipment in use is logical. It is logical that even if the total cost of the equipment has been depreciated the equipment has value, because it is being used. The County Board was not arbitrary in accepting a residual value from duly adopted rules. The letter surmising a smaller residual value was not supported by testimony or first-hand knowledge.

42. The County Board could have chosen to accept the sales price the Petitioner presented. However, they did not. The County Board accepted the appraised value of the Assessor and the Petitioner failed to meet its burden of showing the Assessor was incorrect.

43. The price paid for a property does not necessarily determine fair market value. Gray v. Wyoming State Board of Equalization, 896 P.2d 1347 (Wyo. 1995). The Petitioner failed to present enough evidence that the sales of the subject property met the conditions of a fair market value sale. Therefore, neither the County Board nor the Assessor was bound to accept the Petitioner’s purchase price as fair market value. Union Pacific Railroad v. Wyoming State Board of Equalization, 802 P.2d 856, 861 (Wyo. 1990).

THIS SPACE INTENTIONALLY LEFT BLANK

ORDER

IT IS THEREFORE HEREBY ORDERED:

          The decision of the Fremont County Board of Equalization affirming the Assessor’s 2002 fair market value of the Petitioner’s property is affirmed.

Pursuant to Wyo. Stat. § 16-3-114 and Rule 12, Wyoming Rules of Appellate Procedure, any person aggrieved or adversely affected in fact by this decision may seek judicial review in the appropriate district court by filing a petition for review within 30 days of the date of this decision.

          DATED this 18th day of February, 2003.

                                                                STATE BOARD OF EQUALIZATION

_____________________________________

                                                                Edmund J. Schmidt, Chairman

                                                                _____________________________________

                                                                Roberta A. Coates, Vice-Chairman

ATTEST:

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Wendy J. Soto, Executive Secretary