BEFORE THE STATE BOARD OF EQUALIZATION
FOR THE STATE OF WYOMING
IN THE MATTER OF THE APPEAL OF )
FREMONT COUNTY ASSESSOR FROM )
A DECISION OF THE FREMONT COUNTY ) Docket No. 2005-88
BOARD OF EQUALIZATION - 2005 )
PROPERTY VALUATION )
(Sollars Property) )
DECISION AND ORDER
James Whiting, Deputy Fremont County and Prosecuting Attorney, on behalf of Eileen
Oakley, Fremont County Assessor (Petitioner or Assessor).
Rick and Monica Sollars (Respondents or Taxpayers), appearing pro se.
This is an appeal by the Fremont County Assessor 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.
Petitioners Notice of Appeal was filed with the State Board effective August 18, 2005.
Petitioner and Respondent filed briefs as allowed by the State Board’s October 25, 2005,
Briefing Order. Neither party requested oral argument.
The Assessor appeals the County Board decision directing her to re-assess the Taxpayers’
property using an agricultural classification.
We evaluate the Assessor’s claims against our standard of review, which is whether the
ruling of the County Board was arbitrary, capricious, unsupported by substantial evidence,
and/or contrary to law. Rules, Wyoming State Board of Equalization, Chapter 3, § 9.
PROCEEDINGS BEFORE THE COUNTY BOARD
The County Board conducted a hearing on June 27, 2005. On July 19, 2005, the County
Board entered a Decision ordering the Assessor to re-assess the Taxpayers’ land using an
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 a County Board decision is appealed to the State Board, the State Board 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 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), (currently Wyo. Stat. Ann. § 39-11-102.1(c)).
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. § 16-3-114(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
(b) In excess of statutory jurisdiction, authority or limitations or lacking
(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 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.
Romero v. Davy McKee Corp., 854 P.2d 59, 61 (Wyo. 1993).
We review the findings of ultimate fact of a county board of equalization de novo:
“When an agency’s determinations contain elements of law and fact, we do not
treat them with the deference we reserve for findings of basic fact. When
reviewing an ‘ultimate fact,’ we separate the factual and legal aspects of the
finding to determine whether the correct rule of law has been properly applied
to the facts. We do not defer to the agency’s ultimate factual finding if there
is an error in either stating or applying the law.” Basin Elec. Power Co-op.,
Inc. v. Dep’t of Revenue, State of Wyo., 970 P.2d 841, 850-51 (Wyo.
Britt v. Fremont County Assessor, 2006 WY 10, ¶ 17, 126 P.3d 117, 123 (Wyo. 2006).
We must also apply this “arbitrary and capricious” standard:
Even if sufficient evidence is found to support the agency’s decision under the
substantial evidence test, this [Board] is also required to apply the arbitrary-and-capricious standard as a “safety net” to catch other agency action which
might have violated the Wyoming Administrative Procedures Act. Decker v.
Wyoming Medical Comm’n, 2005 WY 160, ¶ 24, 124 P.3d 686, 694 (Wyo.
2005). “Under the umbrella of arbitrary and capricious actions would fall
potential mistakes such as inconsistent or incomplete findings of fact or any
violation of due process.” Id. (quoting Padilla v. State ex rel. Wyoming
Workers’ Safety and Comp. Div., 2004 WY 10, ¶ 6, 84 P.3d 960, 962 (Wyo.
State ex rel. Wyoming Workers’ Safety and Comp. Div. v. Madeley, 2006 WY 63, ¶ 8, 134
P.3d 281, 284 (Wyo. 2006). Where there is insufficient information to review the decision
of the County Board on its merits or the findings of fact or conclusions of law are inadequate
to permit effective review, the matter must be remanded. Id. at ¶ 14.
Under our standards of review, the Assessor must argue that the County Board decision is
unsupported by substantial evidence, and/or the County Board acted arbitrarily and
capriciously when it determined the property should be classified as agricultural for 2005 tax
We are unable to discern from the County Board decision whether the four separate statutory
requirements for agricultural classification were considered by the County Board or what
factual basis, if any, the County Board relied on in granting Respondents’ request for an
agricultural classification. We will remand this case to the County Board for further
proceedings consistent with this decision.
FACTS PRESENTED TO THE COUNTY BOARD
1. Rick and Monica Sollars own and reside on 19.7 acres of land located at 2195 North
2nd Street in Fremont County, Wyoming. The land was previously known as Lot 2 of the
O’Brien Subdivision in Fremont County, Wyoming. [County Board Record, Exhibit 4, p.
2. Eileen Oakley is the Fremont County Assessor. [Hearing Tape].
3. On or about April 25, 2005, the Assessor sent the Taxpayers an Assessment Schedule
listing the total market value of their property as $400,200 for 2005. Of this total, $136,200
was for the Taxpayers’ land which is the amount at issue in this proceeding. [County Board
Record, Exhibit 3, p. 14].
4. Rick and Monica Sollars applied for agricultural classification for their property on
May 5, 2005. [County Board Record, Exhibit 5, pp. 16-17].
5. On May 18, 2005, the Assessor denied their application for agricultural classification
stating the information furnished did not meet the definition for agricultural land as set forth
in the Wyoming statutes and rules. The Assessor listed the following reasons for the denial:
Property has characteristics of a subdivision or is in transition for further
Primary purpose or use of the land is other than producing a marketable
agricultural product i.e. home site, cabin site, or dude ranch facilities.
Activities on the land, which appear agricultural in nature, do not by
themselves qualify the land for agricultural assessment.
[County Board Record, Exhibit 7, p. 19].
6. The denial letter also requested the Taxpayers submit any additional information
which might affect the classification to the Assessor’s office. The Taxpayers were advised
that if they disagreed with the Assessor’s decision they could file a protest with the County
Board within 30 days of the assessment notice. [County Board Record, Exhibit 7, p. 19].
7. Rick and Monica Sollars filed a Statement To Contest 2005 Property Tax Assessment
on May 23, 2005. [County Board Record, pp. 105-106].
8. A hearing before the County Board was held on June 27, 2005. [County Board
Record, p. 108].
9. At the hearing, Mr. Sollars told the County Board they were seeking an agricultural
classification of their land pursuant to Wyo. Stat. Ann. § 39-13-103. He asserted their land
was being used for agricultural purposes and, like most ranches in the area, the property had
a shop and a home. They raised feeder livestock for their own consumption and put up hay
which they sold. [County Board Record, Hearing Tape].
10. Mr. Sollars testified the land was not part of a platted subdivision, pointing out the
vacation of the O’Brien Subdivision was approved by the county commissioners the previous
year. He stated the county planning rules and regulations allow for a vacation of
subdivisions. [County Board Record, Hearing Tape].
11. Mr. Sollars argued Wyo. Stat. Ann. § 18-5-301 gave the control and regulation of
subdivision of land in unincorporated areas to the county commissioners. He contended that
under this authority the county commissioners reviewed the petition for vacation and did
vacate the O’Brien Subdivision. [County Board Record, Exhibit 1, p. 12].
12. The Taxpayers furnished the County Board a copy of their Federal Income Tax Form
1040 Schedule F, Profit or Loss From Farming, showing a gross income of approximately
$2,830 for Tax Year 2004. From one cutting the area produced three tons of hay per acre.
They fertilized the land and installed irrigation pipe for efficient water use. Mr. Sollars
expressed his opinion that the land has been employed consistent with the land size, location
and capability to produce. All of the properties in the area are generally smaller parcels. Mr.
Sollars ventured a guess that most of the other parcels produce approximately the same
amount as his land but did not have any information to show what the other parcels produced.
[County Board Record, Hearing Tape; Exhibit 6, p. 18].
13. Mr. Sollars took issue with Chapter 10 of the Department Rules. It was his opinion
the rules were in conflict with the statutes in that there are no subjective standards as to
whether or not the land has characteristics of a subdivision. He argued the rules can not
exceed, nullify or change what the legislature passed as law. In his opinion, the legislature
said the land was not part of a platted subdivision. It is either platted or it is not. He argued
the statute does not address whether or not the land does or does not have characteristics of
a subdivision. [County Board Record, Hearing Tape].
14. The Taxpayers also took issue with the Assessor’s statement that the primary purpose
of their land was other than agricultural because of the restrictive convents. Other than the
homestead portion, the Taxpayers either lease the land for grazing or raise hay. [County
Board Record, Hearing Tape].
15. Mr. Sollars told the County Board their property could not be subdivided further for
two reasons. First, the current restrictive covenants precluded any subdivision of the land
unless all of the other owners of the former O’Brien Subdivision lots consent. [County
Board Record, Hearing Tape; Exhibit 10, pp. 22-30]. Second, any additional subdivision of
land would have to come before the county commissioners to have a plat approved. [County
Board Record, Hearing Tape].
16. Mr. Sollars testified there was a Home Owners Association. He told the County
Board the only function of the association was to hold title to the dirt road that serves the
tracts in the area. The road was deeded to the Home Owners Association, which was left
intact when the subdivision was vacated. Each tract has an easement on the road. [County
Board Record, Hearing Tape]. No deed for the road was included in the evidence submitted
to the County Board.
17. The Taxpayers complained to the County Board that other small acre parcels in the
area were given agricultural status. Mr. Sollars reminded the County Board that when the
owners of the O’Brien Subdivision came before the county commissioners to vacate the
subdivision they candidly stated the reason for vacation was to be classified as agricultural.
The owners felt they were being discriminated against tax wise because they were in a platted
subdivision, yet the Bird and Spriggs properties near the subdivision were smaller than any
of the lots in the O’Brien Subdivision and were classified as agricultural. [County Board
Record, Hearing Tape; Exhibits 11, 12, pp. 30-31].
18. In closing, the Taxpayers argued the statute is mandatory: if they met the statutory
requirements they qualified for agricultural status; there was no leeway. The Taxpayers’
position before the County Board was that the Taxpayers met all the requirements of Wyo.
Stat. Ann. § 39-13-103 to qualify for agricultural classification. [County Board Record,
Hearing Tape; Exhibit 8, p. 20].
19. Eileen Oakley testified she was the Fremont County Assessor and was certified as a
property tax appraiser by the Department. [County Board Record, Hearing Tape].
20. The Assessor presented a complete description of the Taxpayers’ property. The
market value of the property was not being disputed, only its agricultural classification.
[County Board Record, Exhibit R, p. 100].
21. The Assessor testified to qualify for agricultural assessment a property must meet the
conditions of the statutes and rules that govern agricultural classification. The statutes
outline those conditions, and Chapter 10 of the Department’s Rules further define the
conditions. [County Board Record, Exhibit I, pp. 57-60].
22. The Assessor told the County Board to meet agricultural classification there were four
qualifications, all of which must be met. The initial qualification is that the land be used to
produce forage. There were, however, other qualifiers. The Assessor must consider that
certain activities which appear to be agricultural in nature do not by themselves qualify land
for the agricultural classification. The Assessor must consider all requirements, not just the
appearance of the land. [County Board Record, Hearing Tape].
23. The Assessor must consider whether or not the land is part of a platted subdivision.
The Assessor conceded the commissioners had vacated the O’Brien Subdivision but believed
the vacation contravened the intent of the statutes on subdivisions. [County Board Record,
24. The Assessor testified the land under appeal had been divided into parcels for sale and
development. [County Board Record, Exhibit K, p. 62]. She stated the owners of the parcels
waited until the subdivision was fully developed to begin the process of vacation. The only
reason for the vacation was to qualify for agricultural classification to lower their taxes.
[County Board Record, Hearing Tape].
25. The third qualification for consideration was whether the owner of the land derived
annual gross revenue of not less than $500. The Taxpayers’ IRS form 1040 Profit of Loss
From Farming shows a gross income of $2,830. [County Board Record, Exhibit 6, p. 18].
Of this amount, $2,480 was from the sale of agricultural products, and $350 was from custom
hire machine work. Id.
26. The fourth qualification for agricultural status was quoted by the Assessor from the
statute. “The land has been used or employed, consistent with the land’s size, location and
capability to produce as defined by the department rules and the mapping and agricultural
manual published by the department, primarily in the agricultural operation...,” where
primarily means chiefly or of the first importance. The Assessor pointed out the Taxpayers’
own covenants established that the land was residential with animals and agricultural use
being limited. Therefore, the Assessor concluded the land’s primary use was residential.
The parcel had significant residential improvements as described in the CAMA printouts.
[County Board Record, Exhibit B, p. 33].
27. The Assessor told the County Board she applied the Department’s Rules equally and
uniformly. Regardless of the fact that people feel they have used property as best they can
and produced as much as they can, the land had to meet the standards of a true agricultural
operation to assess everyone equally. [County Board Record, Hearing Tape].
28. The Assessor prepared a quantitative analysis to determine whether the Taxpayers had
used their land consistent with the land’s capability to produce. [County Board Record,
Exhibit R, pp. 102-103]. She first subtracted two acres from the Taxpayers’ total acreage of
19.7 acres, in order to account for a residential farmstead as required by the Department’s
Rules. Rules, Wyoming Department of Revenue, Chapter 10, § 3(c)(iv). [County Board
Record, pp. 100, 103]. She then determined a productive capacity for the remaining 17.7
acres using elements of the methods prescribed by the Department for valuation of all
agricultural lands. [County Board Record, Exhibit R, p. 102].
29. The Assessor used the Lander Area Soil Survey to determine the land soil type of the
Taxpayers’ property. [County Board Record, Exhibit R, p. 102; Exhibit J, p. 62]. She
overlaid ownership information on the soil survey map to do so. [County Board Record,
Exhibit R, p. 102; Exhibit J, p. 62; Exhibit K, p. 63].
30. The Assessor determined the productive value of the Taxpayers’ soil type using the
2005 Ag Land Valuation Study authorized by the Department. [County Board Record,
Exhibit M, p. 64-79]. The Assessor determined: (1) the pertinent Land Resource Area, and
(2) the productive class of the land. [County Board Record, Exhibit R, p. 102; Exhibit M].
These numbers were translated into a standard productive range for irrigated crop land,
expressed in tons of hay per acre. [County Board Record, Exhibit R, p. 102; Exhibit M, p.
71]. The resulting range of production for the Taxpayer’s property was from three to four
tons per acre. [County Board Record, Exhibit R, p. 102; Exhibit M, p. 71]. Using the chart
identified by the Assessor, those values appear for Land Resource Area 4-5, Class III.
[County Board Record, Exhibit M, p. 71]
31. The Assessor next multiplied the Taxpayers’ total acreage (exclusive of farmstead),
or 17.7 acres, times the low end of expected production per acre of three tons per acre, to
reach an expected total production of 53.1 tons. [County Board Record, Exhibit R, p. 102].
She then multiplied this expected total tonnage by a low revenue estimate of $70 per ton of
hay, and rounded down to reach an expected total of $3,500 revenue for the Taxpayers’
property. [County Board Record, Exhibit R, p. 102].
32. Finally, the Assessor compared this expected revenue, prepared using low-end
estimates at each step, with the Taxpayers’ actual revenue of $2,480. Supra, ¶ 25. In the
Assessor’s judgment, the Taxpayers’ failure to achieve the low-end revenue estimate
demonstrated that the Taxpayers were not using their land consistent with its capability to
produce. [County Board Record, Exhibit R, pp. 102-103].
33. The Assessor testified a portion of the Taxpayers’ production may have been used to
feed horses. Such use would not qualify as agricultural because of the Department’s Rules.
Chapter 10, Section 3(ii)(B)(II), of those rules states “grazing on land by any animal kept as
a hobby will not be considered agricultural….” If part of the production was for hobby
animals the land’s marketable production would be less than its capability to produce, and
the land would not qualify for agricultural classification. [County Board Record, Exhibit I,
34. The Assessor reviewed the records of other small acreage parcels between 5 and 20
acres. The Assessor told the County Board only five small acreage parcels had an
agricultural value. There were 247 other small acreage parcels valued as residential. The
Assessor advised the County Board her office is receiving more and more applications for
agricultural use. Agricultural status is considered at the time of application. Her office has
consistently and uniformly valued these small parcels as residential. [County Board Record,
Hearing Tape; Exhibits N, O, pp. 80-88].
35. In conclusion, the Assessor told the County Board that while the Taxpayers’ parcel
had activities that appear to be agricultural, they did not meet all of the requirements for
agricultural classification. While the land was agricultural prior to being subdivided, the
parcels were subsequently sold and used primarily as residential. The Taxpayers’ parcel was
correctly valued as residential land. [County Board Record, Hearing Tape; Exhibit R, p.
DISCUSSION OF ISSUES AND APPLICABLE LAW
36. The issue raised by the Taxpayers at the County Board hearing was the Assessor’s
denial of agricultural classification for the Taxpayers’ land. On appeal, the Assessor argues
the County Board erred in ordering her to revalue the Taxpayers’ land as agricultural.
37. The Wyoming Constitution article 15, § 11(b) provides in pertinent part: “[a]ll 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.”
38. The classification of land as agricultural requires fulfilment of four statutory
(x) The following shall apply to agricultural land:
(A) The department 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)
of this paragraph. 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 average yields of lands of the
same classification under normal conditions;
(B) Contiguous or noncontiguous parcels of land under one (1)
operation owned or leased shall qualify for classification as agricultural land
if the land meets each of the following qualifications:
(I) The land is presently being used and employed for an
(II) The land is not part of a platted subdivision;
(III) If the land is not leased land, the owner of the land has
derived annual gross revenues of not less than five hundred
dollars ($500.00) from the marketing of agricultural products, or
if the land is leased land the lessee has derived annual gross
revenues of not less than one thousand dollars ($1,000.00) from
the marketing of agricultural products; and
(IV) The land has been used or employed, consistent with the
land's size, location and capability to produce as defined by
department rules and the mapping and agricultural manual
published by the department, primarily in an agricultural
operation, or the land does not meet this requirement and the
requirement of subdivision (III) of this subparagraph because
(1) Experiences an intervening cause of production
failure beyond its control;
(2) Causes a marketing delay for economic advantage;
(3) Participates in a bona fide conservation program, in
which case proof by an affidavit showing qualification in a
previous year shall suffice; or
(4) Has planted a crop that will not yield an income in the
(C) If needed, the county assessor may require the producer to
provide a sworn affidavit affirming that the land meets the requirements of this
paragraph. When deemed necessary, the county assessor may further require
Wyo. Stat. Ann. § 39-13-103(b)(x) (emphasis added).
39. 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, except as provided by law for specific property, 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).
40. A county assessor has a corresponding duty to annually value property within the
assessor’s county, and in doing so 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).
41. The Department’s Rules contain a definition of “agricultural land:”
(a) "Agricultural land" means contiguous or noncontiguous parcels of land
presently being used and employed for the primary purpose of providing gross
revenue from agricultural or horticultural use or any combination thereof
unless part of a platted subdivision. Agricultural land shall generally include
land that is actively farmed, ranched or is used to raise timber for timber
products to obtain a fair rate of return.
Rules, Wyoming Department of Revenue, Chapter 10, § 3(a).
42. The Department’s Rules also contain a definition of “non-agricultural lands:”
(c) "Non-agricultural lands" shall include but not be limited to lands as
described in the State of Wyoming market valuation of Residential,
Commercial and Industrial Lands as published by the Department of Revenue,
Ad Valorem Tax Division:
(i) Lands classified within neighborhood boundaries as residential,
commercial, industrial or rural, whether vacant or improved;
(ii) Lands in active transition from agricultural use to residential,
commercial or industrial use, which includes creation or division of a tract,
parcel or other unit of land for the purpose of sale or development for such use.
(iii) Residential subdivision lands developed with either predetermined
floor plans and elevations or custom buildings;
(iv) Farmsteads with lands occupied by buildings which constitute the
homesite including one or more acres of land used in direct connection with
* * *
(x) Parcels of land forty (40) acres or less unless the landowner
provides proof that such land should otherwise be classified as agricultural
(xi) Land zoned for purposes, which exclude agricultural uses.
Rules, Wyoming Department of Revenue, Chapter 10, § 3(c).
43. Administrative rules have the force and effect of law. Wyo. Dep’t of Revenue v.
Union Pacific Railroad Co., 2003 WY 54, ¶ 18, 67 P.3d 1176, 1184 (Wyo. 2003); Painter
v. Abels, 998 P.2d 931, 939 (Wyo. 2000).
44. With regard to appeals of property tax matters, the Wyoming Supreme Court has
The Department’s valuations for state-assessed property are
presumed valid, accurate, and correct. This presumption can
only be overcome by credible evidence to the contrary. In the
absence of evidence to the contrary, we presume that the
officials charged with establishing value exercised honest
judgement in accordance with the applicable rules, regulations,
and other directives that have passed public scrutiny, either
through legislative enactment or agency rule-making, or both.
The petitioner has the initial burden to present sufficient credible
evidence to overcome the presumption, and a mere difference of
opinion as to value is not sufficient. If the petitioner
successfully overcomes the presumption, then the Board is
required to equally weigh the evidence of all parties and
measure it against the appropriate burden of proof. Once the
presumption is successfully overcome, the burden of going
forward shifts to the DOR to defend its valuation. The
petitioner, however, by challenging the valuation, bears the
ultimate burden of persuasion to prove by a preponderance of
the evidence that the valuation was not derived in accordance
with the required constitutional and statutory requirements for
valuing state-assessed property….
Colorado Interstate Gas Company v. Wyoming Department of
Revenue, 2001 WY 34, ¶¶ 9-11, 20 P.3d 528, ¶¶ 9-11 (Wyo.
2001) (citations omitted).
Airtouch Communications, Inc. v. Dep’t of Revenue, 2003 WY 114, ¶ 12, 76
P.3d 342, 348 (Wyo. 2003).
Thunder Basin Coal Co. v. Campbell County, Wyoming Assessor, 2006 WY 44, ¶ 13, 132
P.3d 801, 806 (Wyo. 2006). This presumption applies equally to an assessor’s valuation of
locally assessed property. Id. at 806 n.1.
A. Present Use for Agricultural Purpose
45. The first statutory requirement to qualify for agricultural valuation is the present use
and employment of the land for an agricultural purpose. Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(I). “Agricultural purpose” is defined by statute:
“Agricultural purpose,” as used in W.S. 39-13-103(b)(x), means the following
land uses when conducted consistent with the land's capability to produce:
(A) Cultivation of the soil for production of crops; or
(B) Production of timber products or grasses for forage; or
(C) Rearing, feeding, grazing or management of livestock.
Wyo. Stat. Ann. § 39-13-101(a)(viii).
46. In this case, the Taxpayers presented testimony that they raised feeder cattle for their
own consumption and put up hay for sale. While the rearing of livestock is an agricultural
purpose, doing so for personal consumption may affect a determination that the land is being
used consistent with its capability to produce. The Taxpayers’ $350 in gross revenue
associated with custom machine work does not qualify as an agricultural purpose. [County
Board Record, Exhibit P, p. 92]. The production of hay for sale is an agricultural purpose
and meets the requirement of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(I).
B. Not Part of Platted Subdivision
47. The second statutory requirement for agricultural classification is that the land “is not
part of a platted subdivision.” Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(II). The Department’s
Rules define “platted subdivision” as follows:
Platted subdivision” means for the purpose of Chapter 13 of Title 39, the
creation of a lot, parcel, or other unit of land; or division of a lot, parcel, or
other unit of land into one or more parts that has received approval from the
governing body in whose jurisdiction the property resides at the time of
creation and is recorded in the records of the county clerk.
Rules, Wyoming Department of Revenue, Chapter 10, § 3(b). We note that neither the parties
nor the County Board addressed this Department Rule.
48. The Taxpayers argue that because their property was not now part of a subdivision,
they met this test. Yet the definition provided in the Department’s Rule is contrary to this
interpretation. Instead, the Department’s definition is backward-looking. If we apply the
letter of the platted subdivision definition found in the Department’s Rules in the context of
this record, it is undisputed that: (1) the Taxpayers’ property is identifiable as a unit of land
that was created as a lot among other units of land, and part of a subdivision; (2) the
subdivision so created received the approval of the governing body in whose jurisdiction the
property resided at the time of creation; and (3) the creation was recorded in the records of
the county clerk. The Taxpayers’ property fits within the Rule, and cannot qualify as
agricultural if the Rule is literally construed.
49. Stated another way, any modification to the status of the Taxpayers’ property as Lot
2 in the O’Brien Subdivision occurred after the subdivision was created. The Department’s
Rule appears to ignore any such post-creation modification of the platted subdivision status.
50. The Taxpayers’ property is one of eight lots platted as the O’Brien Subdivision
pursuant to a plat filed with the Fremont County Clerk, on February 12, 1991. The
Taxpayers assert the O’Brien Subdivision has been vacated. The County Board Record
includes a resolution adopted by the Fremont County Commission purporting to vacate the
O’Brien Subdivision. [County Board Record, Exhibit l, p. 12]. The resolution refers to a
petition to vacate signed by all current owners in the subdivision and to Section 8 of the
Fremont County Subdivision Regulations. Neither the petition nor Section 8 of the Fremont
County Subdivision Regulations are included in the County Board Record.
51. The only Wyoming statute which addresses vacating a subdivision plat is Wyo. Stat.
Ann. § 34-12-106:
Any such plat may be vacated by the proprietors thereof at any time before the
sale of any lots therein, by a written instrument declaring the same to be
vacated, duly executed, acknowledged or proved and recorded in the same
office with the plat to be vacated, and the execution and recording of such
writing shall operate to destroy the force and effect of the recording of the plat
so vacated, and to divest all public rights in the streets, alleys, commons and
public grounds laid out or described in such plat, and in case where any lots
have been sold, the plat may be vacated as herein provided, by all the owners
of lots in such plat joining in the execution of the writing aforesaid. No plat
or portion thereof within the corporate limits of a city or town shall be vacated
as herein provided without the approval of the city or town.
52. The lack of a copy of Section 8 of the County subdivision regulations precludes a
discussion of its content and requirements. While the Wyoming subdivision statutes allow
a county to “impose requirements ... which are more restrictive than the provisions of this
article,” Wyo. Stat. Ann. § 18-5-315, such language does not authorize a county commission
to in effect negate Wyo. Stat. Ann. § 34-12-106. The plain language of Wyo. Stat. Ann. §
34-12-106 does not require a county commission take any action if a plat is to be vacated
under said statute. However, the statute does require a “written instrument declaring the
same to be vacated, duly executed, acknowledged or proved and recorded in the same office
with the plat to be vacated.” The County Board Record is devoid of such information.
53. There is some question whether the statute which provides a procedure to vacate a plat
is in fact applicable to the situation in which an entire subdivision has been sold by the
original developer or proprietor. Wyo. Stat. Ann. § 34-12-106. While the statute allows a
plat to be vacated after “any lots have been sold,” the vacation action must include both the
owners of any lots as well as the original proprietors based upon the language which
indicates the owners join “in the execution of the writing aforesaid.” The “writing aforesaid”
is apparently a reference to the written statement declaring vacation which the original
proprietors are empowered to use to vacate the plat. Wyo. Stat. Ann. § 34-12-106. The
statute in effect allows a plat to be vacated as long as the original proprietors still own a
portion thereof. Once all lots have been sold, the original proprietors no longer own any
interest in the platted property, and the vacation statute is arguably inapplicable. This
interpretation is reinforced by the fact the statutory language differentiates between
“proprietors” who own all lots before any are sold, and “owners” of sold lots.
54. When the State Board interprets the language of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(II), it must reach a reasonable interpretation in light of the purpose and policy
behind the enactment. Kunkle v. State ex rel. Wyoming Workers’ Safety and Compensation
Division, 2005 WY 49, ¶ 11, 109 P.3d 887, 890 (Wyo. 2005). One of the principal purposes
of subdivision regulation is to allow local governments to provide for integration of a new
development into an existing community:
Subdivision regulation is important for a variety of reasons. First, it enables
a community to ensure (insofar as possible) that a new development will “fit
in” with the existing community character, that the existing community will
be able to provide needed services to the new development both at the present
time and in the future, and that the new development will be a safe and healthy
place for its citizens to live. Second, in a broader sense, subdivision controls
give local governments the opportunity to attempt to ensure the success of a
new development. This is important in several respects. For example,
subdivision regulations can protect tax revenues and prevent undue
disbursements of public funds by limiting the creation of blighted areas.
Furthermore, a financially successful development also protects lot purchasers
and mortgage lenders by preserving resale value, and helps protect the
reputation of the subdivision developer.
Patrick J. Rohan, Zoning and Land Use Controls, § 45.01, p. 45-19 (1978-).
55. While the county commissioners approved the Taxpayers’ request to vacate the
subdivision, we doubt the purpose of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(II) was to enable
landowners who subdivided for the purposes of securing government resources, particularly
the location of public roads and access to public roads, to later secure the substantial property
tax benefits of agricultural land status. Even if the O’Brien Subdivision owners had been
candid about vacating the subdivision, supra, ¶¶ 17, 24, the State Board concludes that the
Taxpayers must fully and completely demonstrate compliance with Wyo. Stat. Ann. § 34-12-106, yet did not do so.
56. The public purpose of ensuring the success of a new development is also at issue in
this record. The vacation of a plat also acts to “divest all public rights in the streets, … laid
out or described in such plat.” Wyo. Stat. Ann. § 34-12-106. If there are no “public rights”
in the streets laid out on a vacated plat, the county, in this case, Fremont County, is
prohibited from performing any maintenance, snow removal or repair thereon. Vacating the
plat would also divest the public of any rights in O’Brien Road. The owners of the Lots 5,
6, 7, 8 thus would have no legal access to a public road unless they have been granted
easements by the owners across the lots which lie between Lots 5, 6, 7, 8 and an apparent
public road, North 2nd Street. The lack of access might well affect the value and even the
marketability of Lots 5, 6, 7 and 8. This may not be of great concern to these Taxpayers,
who occupy Lot 2, but there is no indication that the owners of Lots 5, 6, 7 and 8 appreciated
the full implications of vacating the subdivision. The Taxpayer mentioned the dirt road in
his testimony but there is nothing in the record supporting the conveying of the deed to the
road easement to the Home Owners Association. The County Board record contains no
documentary evidence a Home Owners Association exists.
57. The parties to this proceeding did not request oral argument, and their Briefs did not
address the issues of concern to the State Board regarding the interpretation and application
of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(II). The County Board’s decision offers no insight
into what specific facts it relied upon with respect to this test, nor what conclusions of law
it drew. The County Board, the Taxpayers and the Assessor may have an interest in
addressing these issues and may raise arguments or policy considerations that the State Board
has not examined based on the inadequate record presented to us. For example, the Assessor
appears to believe it significant that the parcel in question could not have been created other
than by subdivision. The State Board concludes the appropriate action is to remand the case.
The County Board, in its discretion, may wish to take further evidence from the Taxpayers
regarding whether the subdivision was properly vacated.
C. Minimum Annual Gross Revenues
58. The third requirement to qualify for agricultural valuation is that the owner establish
the statutory minimum gross revenues were derived from agricultural use of the property.
Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(III). The evidence related to the third requirement
consisted of Respondents’ Federal Income Tax Form 1040 Schedule F, Profit or Loss From
Farming, showing a gross income from the sale of agricultural products of approximately
$2,480 for Tax Year 2004. The amount shown on Respondents’ Federal Income Tax form
exceeded the minimum income requirements set by the legislature for agricultural valuation,
and could have been accepted by the County Board as meeting the minimum gross revenues
requirement set by the legislature for agricultural valuation.
D. Use Consistent With Size, Location and Capability to Produce Primarily in an
59. The Wyoming Constitution grants favorable treatment to agricultural and grazing
lands by providing that they “shall be valued according to the capability of the land to
produce agricultural products under normal conditions.” Wyo. Const. art. 15 § 11(b). The
statutory definition of agricultural purpose echoes this language, limiting those purposes to
being “consistent with the land’s capability to produce.” Wyo. Stat. Ann § 39-13-101
(a)(viii). Land can only qualify for agricultural classification if it meets a fourth and related
statutory test of being “used or employed, consistent with the land’s size, location and
capability to produce as defined by department rules and the mapping and agricultural
manual published by the department, primarily in an agricultural operation….” Wyo. Stat.
Ann § 39-13-103 (b)(x)(B)(IV). The qualifying phrase, “consistent with the land’s capability
to produce,” appears repeatedly in the Department’s Rules. E.g., Rules, Wyoming
Department of Revenue, Chapter 10, §§ 3(a)(i), 3(a)(ii), 3(a)(ii)(B), 3(a)(ii)(B)(II),
60. The pertinent definition of “consistent” is “in agreement or harmony; in accord;
compatible.” Webster’s New World College Dictionary, 4th Edition (2001), p. 311. The
fourth statutory test for agricultural classification requires use of the land in an actual
agricultural operation, measured generally by the same constitutional standard providing
favorable property tax treatment – the land’s capability to produce. The State Board
concludes the intent of the legislature was to deny agricultural classification to lands
principally employed in other uses, such as residential or being held for future residential
development, yet generating enough agricultural revenue to meet the minimum gross revenue
standards of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(III).
61. The statute expressly addresses the problem that “normal conditions” may not prevail
in any given assessment year. Unusual conditions may interfere with a taxpayer’s ability to
use the land consistent with its capability to produce. An agricultural producer may
accordingly be excused from compliance with the fourth requirement for agricultural
classification, and the minimum gross revenue requirement of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(III), if it:
(1) Experiences an intervening cause of production failure beyond its control;
(2) Causes a marketing delay for economic advantage;
(3) Participates in a bona fide conservation program, in which case proof by
affidavit showing qualification in a previous year shall suffice; or
(4) Has planted a crop that will not yield an income in the tax year.
Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(IV); see Rules, Wyoming Department of Revenue,
Chapter 10, § 3(a)(ii)(A). The Taxpayers in this case offered no evidence to support any
such excuse from compliance with Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(IV).
62. The Assessor prepared a calculation to quantify her view that the Taxpayers did not
meet this requirement. She first excluded two acres from the Taxpayers’ parcel to account
for their residence, as required by the Department’s Rules and consistent with her practice
for other agricultural land in Fremont County. Rules, Wyoming Department of Revenue,
Chapter 10, § 3(c)(iv). She then calculated a minimum production value for the remaining
acres, which she rounded down to $3,500. Supra, ¶¶ 28-31. This calculation is consistent
with statutory requirements of the Department’s mapping and agricultural manual, which we
have described in detail in other cases arising from Fremont County. E.g., Fremont County
Assessor (Dechert Property), Docket No. 2004-125, February 4, 2005, 2005 WL 301141
(Wyo. St. Bd. Eq.). Finally, she compared this minimum value against the income actually
reported by the Taxpayers, or $2,480. Based on this comparison, she concluded the
Taxpayers had not employed their land consistent with its capability to produce. Supra, ¶
63. The Assessor’s calculation may not be the only approach to determining whether the
use of a particular property is consistent with its capability to produce, but her approach has
obvious virtues. It relies on measurable criteria. The criteria tie to the Assessor’s uniformly
enforced policy concerning the size of the residential portion of agricultural lands in her
county. The criteria also tie to the same measures of productivity that the Department uses
to determine taxable value. They also tie to revenues that a taxpayer can readily document.
These objectively verifiable measures should enable a county assessor and a taxpayer to
readily reach a common understanding about whether the taxpayer’s lands qualify for
64. By taking the Assessor’s calculation one step further, one can also estimate the values
at stake in this case. From the Taxpayers’ property record, we see that four acres of the
Taxpayers’ land are valued at $48,000; four acres are valued at $34,400; and 11.7 acres are
valued at $53,820, for a total land value of $136,200. [County Board Record, Exhibit B, p.
33]. If the Taxpayers were to prevail, their land values would be divided between a two acre
homestead and the remaining 17.7 acres. If we assume that a two acre homestead would
continue to be valued as the highest acreage, half of that value would be $24,000 (in practice
it might be greater, as smaller parcels commonly have a higher value per acre than larger
parcels). The remaining 17.7 acres would be valued as Irrigated Land Resource Area 4, class
III. Supra, ¶ 30. The Assessor’s value per acre for that LRA and class was $801 per acre in
2005. [County Board Record, Exhibit M, p. 79]. The value of the agricultural acreage would
accordingly be $14,178, and the total land value would be $38,178. On these assumptions,
the resulting difference in valuation would be a reduction of $98,022. (By calculation).
65. The related reduction in taxes would be approximately $692.95. The difference in
valuation is multiplied by the tax rate of 9.5%, then by the estimated levy of 74.414 mills.
[See County Board Record, Exhibit A, p. 32]. Similar savings would be realized in future
years as long as the lands remained eligible for agricultural classification.
66. The County Board’s Findings of Fact acknowledge the Assessor “argued” the
“productivity of the property does not meet the requirements for agricultural classification.”
[County Board Record, p. 9, Findings of Fact, ¶ 4]. The County Board likewise
acknowledged its own review of the Assessor’s Exhibit R, which included the Assessor’s
calculations. [County Board Record, p. 9, Findings of Fact, ¶ 5]. The County Board decision
nonetheless failed to address the Assessor’s undisputed and objective measurement of the
degree to which the Taxpayers actually used their land for agricultural purposes, and found
generally that the Taxpayers had met their burdens. [County Board Record, p. 10, Decision
and Order, ¶ 3]. We are also uncertain as to whether the County Board understood the
statutory requirement, because the words “consistent with the land’s capability to produce”
are not expressly referenced in the County Board’s decision.
67. While the County Board’s decision appears to be contrary to the undisputed evidence
and the statutory standard, the State Board is unable to discern the County Board’s rationale
from either the record or the face of its written decision. Specifically, the State Board is
unable to discern how or why the County Board concluded that the Taxpayers met the
requirements of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(IV). For this reason alone, we
remand the County Board’s decision for further proceedings, and anticipate a decision which:
(1) specifically acknowledges the requirements of the statute; and (2) if the County Board
concludes that the Taxpayers have met the requirements of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(IV), specifically addresses the evidentiary basis for its conclusions.
68. The County Board’s decision indicates that it considered two other issues related to
Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(IV), i.e. the argument that the property was in
transition to a residential purpose, [County Board Record, p. 9, Findings of Fact, ¶ 4], and
the effect of the restrictive covenants on the Taxpayers’ property, [County Board Record, p.
9, Findings of Fact, ¶ 3]. On remand, the State Board concludes that the County Board is not
obliged to revisit the first issue, but may wish to revisit the second.
69. The “lands in transition” issue arises from the Department’s definition of non-agricultural lands. Supra, ¶ 42. The State Board has previously been reluctant to deny
agricultural classification based on an assessor’s general assertion that the lands in question
are in transition. E.g., Arnola M. Davis, Docket No. 2003-96, February 11, 2004, 2004 WL
364070 (Wyo. St. Bd. Eq.). In this case, the County Board could readily have determined,
in its capacity as finder of fact, that any transition with respect to the Taxpayers’ land had
already occurred. We accordingly uphold the County Board’s conclusion on this point.
70. The Taxpayers referred to their restrictive covenants as a response to the Assessor’s
argument that the Taxpayers’ land was in transition. Response Brief, p. 13. Specifically,
they argued that the restrictive covenants now prohibit subdivision of their land. Id. While
this may be a response to the Assessor’s concern for the lands being in transition, it does not
speak at all to the matter of the capability of the Taxpayers’ lands to produce. If the
restrictive covenants bear in any way on the fourth statutory test, it can only be as evidence
to determine whether their lands are in use “primarily in an agricultural operation.” Wyo.
Stat. Ann. § 39-13-103(b)(x)(B)(IV). The State Board doubts that an examination of the
restrictive covenants supports the Taxpayers’ claim and the County Board’s decision.
71. In their present form, we would be inclined to characterize the covenants as
maintaining a residential character for the Taxpayers and the seven other properties of the
O’Brien Subdivision, with minor accommodation for agricultural activity. For example, the
covenants empower the Architectural Control Committee to determine the number and type
of livestock which may be kept on any given property. [County Board Record, Exhibit 10,
Covenants, Section V, p. 22]. On its face, this provision promotes residential use, restricts
agricultural use, and unavoidably acts as a limit on the land’s capability to produce. We are
skeptical that land which is truly devoted primarily to agricultural purposes can be
encumbered by restrictive covenants. However, we cannot discern from the County Board’s
decision how it chose to address the effect of the covenants. Should the County Board
determine on remand that the Taxpayers have otherwise met the requirements of Wyo. Stat.
Ann. § 39-13-103(b)(x)(B)(IV), we encourage specific findings and conclusions on this
E. Miscellaneous Issues
72. In its decision, the County Board noted the Taxpayers’ evidence regarding “a disparity
in classifications with similar sizes of property in the vicinity.” [County Board Record, p.
9, Findings of Fact, ¶ 3]. As a matter of law, any disparity can be of no concern if the other
tracts properly qualify as agricultural. In fact, the Taxpayers are plainly seeking to create a
disparity between themselves and other taxpayers who have located in large lot subdivisions
in Fremont County. The sole question before the County Board was whether the Taxpayers
qualify for favorable treatment.
73. The Taxpayers have also ignored a provision of the Department’s Rules placing an
additional burden on the landowners who seek agricultural classification for a parcel of forty
acres or less. Those landowners must provide proof that a parcel of that size should be
classified agricultural. Rules, Wyoming Department of Revenue, Chapter 10, § 3(c)(x). This
burden applies whether or not the landowner chooses to appeal an assessor’s determination
of agricultural classification. For any such landowner, the threshold question is not whether
other landowners have provided such proof to the assessor, but whether the landowner
seeking the classification has done so.
74. We conclude the the County Board’s Findings of Fact and Conclusions of Law are
inadequate to permit review of the merits of the County Board’s determination. We must,
therefore, remand this case to the County Board for supplemental findings of fact and
conclusions of law or other proceedings consistent with this decision.
IT IS THEREFORE HEREBY ORDERED that the decision of Fremont County
Board of Equalization granting the Taxpayers agricultural classification is remanded to the
Fremont County Board of Equalization for further proceedings consistent with this decision.
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.
DATED this day of July, 2006.
STATE BOARD OF EQUALIZATION
Alan B. Minier, Chairman
Thomas R. Satterfield, Vice-Chairman
Thomas D. Roberts, Board Member
Wendy J. Soto, Executive Secretary