BEFORE THE STATE BOARD OF
FOR THE STATE OF WYOMING
THE MATTER OF THE APPEAL OF
FREMONT COUNTY ASSESSOR FROM )
DECISION OF THE FREMONT COUNTY ) Docket
EQUALIZATION - 2004 )
DECISION AND ORDER
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.
PROCEEDINGS BEFORE THE COUNTY BOARD
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.
STANDARD OF REVIEW
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;
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;
(c) Without observance of procedure required by law; or
(d) Unsupported by substantial evidence.
Rules, Wyoming State Board of Equalization, Chapter 3, §9.
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
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.
FACTS PRESENTED TO THE COUNTY BOARD
owns or controls 610 acres of agricultural land in Fremont County, Wyoming, consisting of
three (3) parcels:
Vernon L. & Jolene D. Scheer
* each includes a two (2) acre homestead.
[Hearing Tape, County Board Record, pp. 7-9].
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.
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].
May 13, 2004, Respondent filed a Statement To Contest 2004 Property Tax Assessment for all
three (3) parcels. [County Board Record, pp. 1-2].
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].
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].
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].
Respondent testified that all the hay producers he spoke to were from Fremont County.
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,
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.
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.
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].
DISCUSSION OF PETITIONER’S ISSUES AND APPLICABLE LAW
timely filed an appeal from the County Board decision.
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
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.
Wyo. Stat. Ann. §39-13-103 (b)(x)(A).
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
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. . . .
Rules, Wyoming Department of Revenue, Chapter 11,
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
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
this _______ day of February, 2005.
STATE BOARD OF EQUALIZATION
Alan B. Minier, Chairman
Thomas R. Satterfield, Vice-Chairman
Thomas D. Roberts
Wendy J. Soto, Executive Secretary