Terrance R. Martin, Deputy Fremont County Attorney, on behalf of Eileen Oakley, Fremont County Assessor (Petitioner or Assessor).

Vernon L. Scheer, on behalf Vernon L. and Jolene D. Scheer and Buckmaster Inc., a Wyoming Corporation, appearing pro-se (Respondent or Taxpayer).

This is an appeal from a decision of the Fremont County Board of Equalization (County Board). The State Board of Equalization (State Board), comprised of Alan B. Minier, Chairman, Thomas R. Satterfield, Vice-Chairman, and Thomas D. Roberts, Board Member, considered the hearing record and decision of the County Board. Petitioner’s Notice of Appeal was filed with the State Board effective August 31, 2004. The Assessor alone filed a brief as allowed by the State Board’s November 5, 2004, Briefing Order. Neither party requested oral argument.

The Assessor appealed the County Board decision ordering the Assessor to recalculate the value of the Respondent’s irrigated crop land in Fremont County, Wyoming. The Assessor argues that the County Board’s decision ordering the recalculation of the taxable value of Taxpayer’s property using a figure of $81.00 per ton, or in the alternative, the same amount assessed for the 2002 tax year, was arbitrary, capricious, and unsupported by the substantial evidence.

The County Board conducted a hearing on June 28, 2004. A “Decision on Appeal” was entered by the County Board on August 2, 2004.

The State Board is required to “hear appeals from county boards of equalization.” Wyo. Stat. Ann. §39-11-102.1(c). A timely appeal from the County Board decision was filed with the State Board. Rules, Wyoming State Board of Equalization, Chapter 3, §2.

When the State Board hears appeals from a County Board, it acts as an intermediate level of appellate review. Laramie County Board of Equalization v. Wyoming State Board of Equalization, 915 P.2d 1184, 1188 (Wyo. 1996); Union Pacific Railroad Company v. Wyoming State Board of Equalization, 802 P.2d 856, 859 (Wyo. 1990). In its appellate capacity, the State Board treats the County Board as the finder of fact. Id. In contrast, the State Board acts as the finder of fact when it hears contested cases on appeal from final decisions of the Wyoming Department of Revenue (Department). Wyo. Stat. Ann. §39-11-102.1(c). This sharp distinction in roles is reflected in the State Board Rules governing the two different types of proceedings. Compare Rules, Wyoming State Board of Equalization, Chapter 2 and Rules, Wyoming State Board of Equalization, Chapter 3. Statutory language first adopted in 1995, when the State Board of Equalization and the Department were reorganized into separate entities, does not express the distinction between the State Board’s appellate and de novo capacities with the same clarity as our long-standing Rules. 1995 Wyo. Sess. Laws, Chapter 209, §1; §39-1-304(a).

By Rule, the State Board’s standards for review of a County Board’s decision are nearly identical to the Wyoming Administrative Procedure Act standards which a district court must apply to hold unlawful and set aside agency action, findings of fact, and conclusions of law. Wyo. Stat. Ann. §16-3-114(c)(ii). However, unlike a district court, the State Board will not rule on claims that a County Board has acted “[c]ontrary to constitutional right, power, privilege or immunity.” Wyo. Stat. Ann. §16-1-114(c)(ii)(B). The State Board’s review is limited to a determination of whether the County Board action is:

(a) Arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law;

(b) In excess of statutory jurisdiction, authority or limitations or lacking statutory right;

Since the State Board Rules are patterned on the judicial review provision of the Wyoming Administrative Procedure Act, we look to precedent under Wyo. Stat. Ann. §16-3-114(c) for guidance. For example, we must apply this substantial evidence standard:

Our task is to examine the entire record to determine if substantial evidence exists to support the [County Board’s] findings. We will not substitute our judgment for that of the [County Board] if [its] decision is supported by substantial evidence. Substantial evidence is relevant evidence which a reasonable mind might accept in support of the agency’s conclusions.

Clark v. State ex rel. Wyoming Workers’ Safety and Compensation Division, 934 P.2d 1269, 1272 (Wyo. 1997).

The Petitioner argues the County Board decision is unsupported by substantial evidence, and the County Board arbitrarily and capriciously determined the property’s production value for 2004 tax purposes.

We conclude that agricultural land is valued and assessed on the objective value of what the land is capable of producing under normal conditions. The value is not based on what the land is actually producing but on what the soils, temperature, moisture and other factors would allow. It is the responsibility of the Department to develop values which must be followed by the Assessor and County Board.

1. Respondent owns or controls 610 acres of agricultural land in Fremont County, Wyoming, consisting of three (3) parcels:

	Area	Location	Owners
Parcel 1	180 acres*	Hwy 26	Vernon L. & Jolene D. Scheer
Parcel 2	280 acres	Pavillion Road	Buckmaster Inc.
Parcel 3	150 acres*	Pavillion Road	Buckmaster Inc.

2. Vernon Scheer appeared at the County Board hearing on behalf of Respondent. Terrance R. Martin, Deputy Fremont County Attorney, appeared at the hearing on behalf of the Assessor. [Hearing Tape].

3. On April 14, 2004, the Assessor sent 2004 tax year Notices of Assessment to the Respondent for each of the three (3) parcels of land. [County Board Record, pp. 11-13].

4. On May 13, 2004, Respondent filed a Statement To Contest 2004 Property Tax Assessment for all three (3) parcels. [County Board Record, pp. 1-2].

5. On June 17, 2004, the County Board of Equalization scheduled a July 20, 2004 hearing in the matter of Respondent’s protest. [County Board Record, p. 5].

6. At the hearing, the Respondent requested that his taxes remain the same as the previous year. Although the state is using $110 per ton for hay as the base price for valuation, Respondent never paid that much for hay. He believed a great deal of hay had left the county. He testified he had paid $85 per ton for good quality oat hay. [Hearing Tape].

7. The Respondent testified he contacted several gentlemen before the hearing who sell, produce and haul hay. Daniel Weilever sold and hauled hay in 2002 for between $85 per ton, within Fremont County, and $110 per ton outside the county. Mr. Weilever did not sell any hay in 2003 because he refused to sell it for less than $75 per ton. In 2002 the Respondent paid Jerry Heulle $85 per ton for hay. That year Mr. Heulle sold hay for between $75 per ton and $100 per ton. Then in 2003, Mr. Heulle’s price dropped to $65 per ton with some high quality hay selling for $85 per ton. The Respondent testified that most of Respondent’s hay went to its cow calf operation. Respondent sold cows not hay. [Hearing Tape].

8. The Respondent testified that all the hay producers he spoke to were from Fremont County. [Hearing Tape].

9. The Respondent testified that he did not understand the basic concept of using a weighted average to establish a per ton value for hay. [Hearing Tape].

10. The Assessor testified that Respondent owned or controlled three parcels of land totaling 610 acres and was presently purchasing the Buckmaster properties. The buildings were all valued using the CAMA system. However, the valuation of the buildings was not being appealed. The Respondent’s land qualifies for agricultural valuation. [Hearing Tape].

11. The Assessor testified that the Wyoming Constitution requires all property be valued at full value except agricultural and grazing lands which are valued according to the land’s ability to produce agricultural products under normal conditions. [Hearing Tape].

12. The production value was determined using the 2004 Agricultural Land Value Study [Exhibit D] and the Mapping and Agricultural Manual described in Wyo. Stat. Ann. §39-11-102. The Assessor explained the constitutional requirements for agricultural valuation are also described in Wyo. Stat. Ann. §39-13-103. The Department must determine the taxable value of agricultural land. The Department figured productive value in its 2004 Agricultural Land Valuation Study. [County Board Record, p. 31]. The Assessor is given a range of values by the Department and she must stay within that range. [Hearing Tape].

13. The Assessor testified that the other factors which must be considered for proper classification are: a) soil type, b) slope, and c) rain fall. Using the 2004 Agricultural Land Valuation Study as a guideline and Department of Revenue Rules, Chapter 11, she obtained a value for each soil classification. [County Board Record p. 50].

14. The Assessor pointed out the values used for Fremont County on Exhibit E are from $255 to $1,147 per acre depending on the classification of the soil. [County Board Record p. 43]. The Assessor testified she cannot deviate from the range of valuation figures which come from the Department. In this case she used the lowest figure possible. The commodity values of hay come from the Wyoming Agricultural Statistics Service. For irrigated land the value is to be based on the price of all hay reported in dollars per ton. [County Board Record, p.31].

15. The Assessor showed the Board how values are converted to a five year weighted average used in the formula for valuing irrigated crop land valuation. [County Board Record, p. 34]. She explained that the weighted average is figured by using the 2002 value multiplied by five and 2001 value multiplied by four, and so on. This year the value of $110 per ton was converted to $96.37 per ton using the five year weighted average. [Hearing Tape].

16. The Assessor testified she wrote to Mr. Dick Coulter, director of the Wyoming Agricultural Statistics Service, in order to help her understand the figures. [County Board Record, Exhibit F, p. 44]. She asked for the number of tons of hay used in the study, the average price of both native and alfalfa hay, and the location of the samples. The Assessor submitted the response from Mr. Coulter, and testified that none of her questions were answered. [Hearing Tape, County Board Record, Exhibit G-1 p. 45]. The Assessor testified that she knew only one person who had been surveyed by the Wyoming Agricultural Statistics Service. [Hearing Tape].

17. The Assessor testified that the formula used to value irrigated crop land was derived over twenty years ago and has worked well until recently. Additionally, she testified other factors in the formula have not been questioned. The actual price of hay falls within a very narrow range. However, the figures being used to value hay are not representative of hay prices in Fremont County. The Assessor testified the Midvale Irrigation District figures, a five year average of $85 per ton, were probably a better representation for Fremont County. [Hearing Tape].

18. On August 2, 2004 the County Board issued its decision ordering the Assessor to recalculate the taxpayer’s agricultural property using $81.00 per ton for hay, or in the alternative, to assess the agricultural property at the same amount assessed for the 2002 tax year. [County Board Record, p. 61].

20. The State Board has jurisdiction to hear and determine all issues raised by the Petitioner pursuant to Wyo. Stat. Ann. §39-13-109(b).

21. The issue raised by the Respondent at the County Board hearing and by the County Board’s decision concerns the valuation of irrigated crop land: specifically, the price per ton of hay used in the valuation process. The Respondent produced information from four Fremont County hay producers concerning the price per ton charged for hay in 2002 and 2003. None of the four producers sold hay in Fremont County for $110 per ton during that time.

22. The Assessor argues that the County Board erred in ordering her to deviate from the values established by the Department of Revenue’s 2004 Agricultural Land Valuation Study which is the basis for valuation of irrigated crop land.

23. The Wyoming Constitution, Article 15, §11(b) provides in pertinent part that: “All taxable property shall be valued at its full value as defined by the legislature except agricultural and grazing lands which shall be valued according to the capability of the land to produce agricultural products under normal conditions.”

24. The authority to determine the taxable value of agricultural lands is vested in the Department of Revenue.

The department [of revenue] shall determine the taxable value of agricultural land and prescribe the form of the sworn statement to be used by the property owner to declare that the property meets the requirements of subparagraph (B) . . . . In determining the taxable value for assessment purposes under this paragraph, the value of agricultural land shall be based on the current use of the land, and the capability of the land to produce agricultural products including grazing and forage, based on the average yields of lands of the same classification under normal conditions.

25. The primary consideration in classifying agricultural land for assessment purposes is the land’s capability to produce agricultural products under normal conditions. Wyo. Const. art. 15, §11(b); Wyo. Stat. Ann. §39-13-103(b)(x)(A); Rules, Wyoming Department of Revenue, Chapter 11, §4 (a)(i).

26. The Department is required to confer with, advise and give necessary instructions and directions to the county assessors as to their duties, and to promulgate rules and regulations necessary for the enforcement of all tax measures. Wyo. Stat. Ann. §39-11-102(c)(xvi) and (xix). In particular, the Department “shall prescribe by rule and regulation the appraisal methods and systems for determining fair market value using generally accepted appraisal standards.” Wyo. Stat. Ann. §39-13-103(b)(ii).

27. The Department has adopted Rules, Chapter 11, Ad Valorem Classification, Valuation, Methodology and Assessment for Designated Agricultural Land. Consistent with Wyo. Stat. Ann. §39-13-103(b)(x)(A), the Department’s Rules provide that “[t]he Mapping and Agricultural Manual is the Department’s official source for general mapping and agricultural land valuation standards for all County Assessors.” Rules, Wyoming Department of Revenue, Chapter 11, §4(a).

28. The Department’s Rules, Chapter 11, §5 require the Department to develop valuation amounts for agricultural land using the “Mapping and Agricultural Manual.” The determined value is based upon the capacity of the land to produce forage or crops. The Department publishes this valuation information through the annual Agricultural Land Valuation Study:

Valuation amounts for agricultural land for assessment purposes shall be based upon the Department’s Mapping and Agricultural Manual, and shall be published annually by January first or as soon thereafter as possible by the Department. The valuation of agricultural land is based upon the land’s capability to produce forage or crops.

Rules, Wyoming Department of Revenue, Chapter 11, §5(a). The annual Agricultural Land Valuation Study is, in form and function, an order, procedure or formula of the Department.

29. The Department’s Rules for the valuation of irrigated crop land further provide:

The gross income from irrigated crop land is based on the price of all hay reported in dollars per ton by the Wyoming agricultural statistics service. This price information is converted to a 5 year weighted average. The gross income from irrigated crop land is calculated using the 5 year weighted average price of all hay per ton. . . .

30. An assessor is required to select a value “. . . within the range of values for the current year as published in the Ad Valorem Tax Division’s Agricultural Land Valuation Study.” Rules, Wyoming Department of Revenue, Chapter 11, §5(c).

31. An assessor’s valuation is presumed valid, accurate, and correct. This presumption 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 overcome the presumption. J. Ray McDermott & Co. v. Hudson, 370 P.2d 364, 370 (Wyo. 1962). The presumption is especially valid where the Assessor valued the property according to the Department’s Rules and Regulations. Rules, Wyoming Department of Revenue, Chapter 11. “The burden is on the Taxpayer to establish any overvaluation.” Hillard v. Big Horn Coal Co., 549 P. 2d 293, 294 (Wyo. 1976).

32. The County Board record lacks any evidence by Respondent challenging the Assessor’s productivity classification. By Department Rule, valuation of irrigated crop lands is based on values established by the Wyoming Agricultural Statistics Service each year for the entire state. Rules, Wyoming Department of Revenue, Chapter 11, §5(b)(ii)(A)(I). Therefore, the valuation is not based on values from a particular county or a specific irrigation district. Rules, Wyoming Department of Revenue, Chapter 11, §5(b)(ii)(A)(I); see supra ¶ 29.

33. An assessor is required to annually value property within the assessor’s county for tax purposes at its fair market value. In completing this task the assessor is required to “[f]aithfully and diligently follow and apply the orders, procedures and formulae of the department of revenue or orders of the state board of equalization for the appraisal and assessment of all taxable property.” Wyo. Stat. Ann. §18-3-204(a)(ix).

34. In addition, “[t]he county board of equalization has no power to and shall not set tax policy nor engage in any administrative duties concerning assessments which are delegated to the board, the department or the county assessor.” Wyo. Stat. Ann. §39-13-102(d).

35. The Department’s annual Agricultural Land Valuation Study, as an order, procedure, and formula, is binding on an assessor. Neither the Assessor nor the County Board have the authority to deviate from the valuation ranges established by the Department.

36. Based on the applicable constitutional provision; the Wyoming Statutes; and the Rules and Regulations of the Department; which require the assessor to classify agricultural land based on its capability to produce, we conclude the decision of the County Board ordering the Assessor to recalculate the taxpayer’s agricultural property using a figure of $81.00 per ton for hay, or in the alternative, assess the agricultural property at the same amount assessed for the tax year 2002, was arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law.

37. Further we conclude there was no substantial evidence in the record to support the County Board’s alternative figures for the 2004 tax year. By law, the County Board was obliged to limit its review to the range of values established by the Department for use by the Assessor.

38. The Department is not a party to this appeal. Rules, Wyoming State Board of Equalization, Chapter 3, §4. If the Respondent has a grievance with the Department for setting a range of values for the County Assessor, the remedy does not lie in this appeal.

IT IS THEREFORE HEREBY ORDERED that the Fremont County Board of Equalization Order instructing the Assessor to revalue the Respondent’s property is reversed and the Assessor’s 2004 assessment of Respondent’s property is reinstated.

Pursuant to Wyo. Stat. Ann. §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.