BEFORE THE STATE BOARD OF EQUALIZATION

FOR THE STATE OF WYOMING

IN THE MATTER OF THE APPEAL OF )

RAMON AND TRINA NATION FROM )

A VALUATION DECISION OF THE ) Docket No. 2006-82

FREMONT COUNTY ASSESSOR )

2005 PROPERTY VALUATION )

FINDINGS OF FACT, CONCLUSIONS OF LAW, DECISION AND ORDER

APPEARANCES

Ramon A. and Trina R. Nation (Petitioners or Taxpayers), appearing pro se.

James Whiting, Deputy Fremont County and Prosecuting Attorney, on behalf of Eileen Oakley, Fremont County Assessor (Respondent or Assessor).

STATEMENT OF THE CASE

This matter originally came before the State Board of Equalization (State Board) as an appeal by the Fremont County Assessor from a decision of the Fremont County Board of Equalization (County Board). The Assessor appealed the County Board decision directing her to re-assess the Taxpayers’ property using an agricultural classification. The 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. Neither party requested oral argument. The State Board entered a Decision and Order dated July 13, 2006, remanding the Assessor’s appeal to the County Board for further proceedings. Fremont County Assessor, Docket No. 2005-84, July 13, 2006, ___ WL ______ (Wyo. St. Bd. Eq.). In response, on August 14, 2006, the County Board requested, pursuant to Rules, Wyoming State Board of Equalization, Chapter 2, §36, that the original appeal by Taxpayers of the Assessor’s denial of their request for agricultural status be certified to the State Board for its consideration as the finder of fact rather than as an intermediate level of appellate review. Wyo. Stat. Ann. § 39-11-102.1(c). Compare Rules, Wyoming State Board of Equalization, Chapter 2 and Rules, Wyoming State Board of Equalization, Chapter 3. 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). The State Board granted certification by order dated August 24, 2006. The appeal of the Taxpayers from the Assessor’s agricultural status denial is thus before this Board the same as an initial appeal pursuant to Rules, Wyoming State Board of Equalization, Chapter 2.

The State Board has reviewed and carefully considered all the evidence presented at the County Board hearing, including a tape recording of the testimony. There was no issue of credibility of the witnesses with respect to the matters which dispose of this case, thus a repeat of their testimony to this Board is not necessary. We have also been provided, in the context of the Assessor’s original appeal to this Board, sufficient briefing on the relevant issues, thus the receipt of further briefing is not required.

JURISDICTION

Within 30 days after the date or postmark date of an assessment schedule, whichever is later, objections to local assessments must be filed with the county assessor indicating why assessment is incorrect. Wyo. Stat. Ann. §39-13-109(b)(i). The Taxpayers’ assessment schedule was dated April 25, 2005. The Assessor’s denials of agricultural status were dated April 4, and May 15, 2005. Taxpayers’ protests were filed with the County Assessor on May 10, and May 15, 2005. The Taxpayers’ appeal is timely.

CONTENTIONS AND ISSUES

The Taxpayers assert the County Assessor improperly denied agricultural valuation in 2005 for 18.74 acres of their property. We affirm the Assessor’s denial of agricultural status.

FINDINGS OF FACT

1. Ray and Trina Nation own and reside on 18.74 acres at 31 O’Brien Road north of Lander, Wyoming. The property was formerly known as Lot 5 of the O’Brien Subdivision in Fremont County, Wyoming. [Board Record, Exhibit A, p. 12].

2. Eileen Oakley is the Fremont County Assessor. [Board Record, Hearing Tape].

3. The Assessor sent Taxpayers an Assessment Schedule listing the total market value of their property as $432,300 on April 25, 2005. Of this total, $131,800 was for the Taxpayers’ land, which is the value at issue in this proceeding. [Board Record, Exhibit A, p. 12].

4. Ray and Trina Nation applied for agricultural classification for their property on March 1, 2005, using the Fremont County Affidavit for Agricultural Classification, 2005 Assessment Year form. [Board Record, Exhibit P, pp. 72, 79].

5. On April 4, 2005, the Assessor denied Taxpayers’ application for agricultural classification stating the information furnished did not meet the definition for agricultural land set forth in the Wyoming statutes and rules, and the property had characteristics of a subdivision or was in transition for further development. [Board Record, Exhibit 14, p. 135].

6. Ray and Trina Nation made a second request for agricultural classification for their property on May 6, 2005. Again, they used a Fremont County Affidavit for Agricultural Classification, 2005 Assessment Year form. [Board Record, Exhibit 12, pp. 130-132].

7. On May 18, 2005, the Assessor sent a letter denying the Taxpayers’ second 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 gave the following reasons for the denial:

Property has characteristics of a subdivision or is in transition for further development.

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.

The owner/lessee does not report or pay taxes on farm machinery or other agricultural equipment.

[Board Record, Exhibit P, p. 71].

8. The denial letter also advised Taxpayers if they had additional information which may affect the classification to furnish it to the Assessor’s office. If they disagreed with the decision, they could file a protest with the County Board within 30 days of the assessment notice. [Board Record, Exhibit P, p. 71].

9. The Taxpayers filed a Statement To Contest 2005 Property Tax Assessment on May 10, 2005, with a letter attached. [Board Record, Exhibit 5, pp. 104-105; Exhibit 6, pp. 106-107]. The Taxpayers filed a second Statement to Contest 2005 Property Tax Assessment on May 15, 2005, with additional information attached. [Board Record, Exhibit 7, pp. 108-110].

10. Mr. Nation testified the O’Brien Subdivision was vacated in 2004. In support of this testimony, a copy of a quitclaim deed was submitted. [Board Record, Exhibit 3, p. 100].

11. Mr. Nation testified the land being appealed is part of their cow/calf operation. In addition to their 18.74 acres in this appeal, they own 20 acres of irrigated and sub-irrigated pasture in the Fort Washakie area, and lease 40 acres of irrigated hay land in the Boulder Flat region. [Board Record, Hearing Tape; Exhibit 10, pp. 125-126; Exhibit 11, pp. 127-129].

12. Mr. Nation stated he was seeking agricultural classification for irrigated land which produced two cuttings of hay. Half of the hay was sold and the other half was used to feed their cattle. All of the cattle spend eight months each year on the 31 O’Brien Road property. Mr. Nation presented copies of four checks representing the proceeds from the sale of agricultural products in 2004. The agricultural products included hay, three-quarters of one butchered beef, three open cows and one six year old bull. [Board Record, Hearing Tape; Exhibit P, pp. 78-79; Exhibit 13, pp. 133-134].

13. The Taxpayers also submitted their 2004 tax return, including Schedule F, Profit or Loss From Farming, which indicated no gross revenues from their agricultural operation in 2004. [Board Record, Exhibit P, pp. 74-77].

14. The Taxpayers complained that similar parcels near their property, including the Richard Bird and Ken Mead properties, received agricultural classification. Neither property had a cattle operation but both have a few horses for pleasure. [Board Record, Exhibit 15, p. 137].

15. Mr. Nation argued all of the property within the county could have characteristics of subdivisions. He testified their land would never be further developed or subdivided because the rules of the Home Owners Association will not allow it. [Board Record, Hearing Tape; Exhibit 2, p. 94].

16. Mr. Nation testified the landowners in the former O’Brien Subdivision could run as many livestock as they wanted but could not have certain types of livestock such as hogs and chickens. He said the covenants do not provide for a committee setting the number of sheep or cows. [Board Record, Hearing Tape].

17. The Taxpayers disagreed with the Assessor concerning the land being in transition. The Taxpayers questioned why there was a difference in the Assessor’s denial of their two agricultural exemption applications. [Compare Board Record, Exhibit 14, p. 135 with Exhibit P, p. 71].

18. Eileen Oakley testified she was the Fremont County Assessor and was certified as a property tax appraiser by the Department of Revenue (Department). [Board Record, Hearing Tape].

19. The Assessor presented a complete description of the Taxpayers’ property. The market value of the property was determined by using the CAMA (Computer Assisted Mass Appraisal) system authorized by the Department. [Board Record, Exhibit B, p. 13].

20. Only the residential classification of the Taxpayers’ land was disputed. [Board Record, Hearing Tape; Exhibit R, p. 87].

21. The Assessor testified in order to qualify for agricultural assessment the Taxpayers’ property must meet the conditions of the statutes and rules governing agricultural classification. The statutes outline those conditions, and Chapter 10 of the Rules of the Department further define the conditions. [Board Record, Exhibits I, pp. 39-42; Exhibit R, p. 88].

22. The Assessor stated that 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. [Board Record, Hearing Tape; Exhibit R, p. 88].

23. The Assessor must consider whether the land is part of a platted subdivision. The Assessor conceded the Board of County Commissioners had vacated the O’Brien Subdivision but believed the vacation contravened the intent of the statutes on subdivisions. [Board Record, Hearing Tape; Exhibit R, p. 88].

24. The Assessor testified the parcels in the O’Brien Subdivision were required to be platted at the time they were formed, and would be required to be platted if they were formed today. [Board Record, Hearing Tape; Exhibit K, p. 44].

25. The Assessor testified the definition of non-agricultural land under the Department’s Rules, Chapter 10, § 3(c)(ii) states “[l]and 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” shall be non-agricultural. [Board Record, Assessor’s Exhibit I, p. 41; Exhibit R, p. 88].

26. The Assessor argued the owners of the O’Brien Subdivision lots waited until the subdivision was fully developed to begin the process of vacation. These lots were sold as residential lots. The original restrictive covenants were designed to ensure use of the property for attractive country living, with residential purposes only. The original restrictive covenants allowed some animals but such use was regulated by an Architectural Control Committee. [Board Record, Hearing Tape; Exhibit D, pp. 17-22; Exhibit R, p. 88]. The amended restrictive covenants, filed after the vacation of the subdivision, changed the covenants’ wording minimally, adding the word “agricultural” to the permitted land uses. The Architectural Control Committee, however, still controlled the use of the land in the amended covenants. [Board Record, Hearing Tape; Exhibit F, pp. 29-37].

27. The Assessor testified the statutes and rules which address agricultural land require it be used or employed primarily in an agricultural operation, where primarily means chiefly or of the first importance. The Assessor expressed her opinion that because the land was defined in its own covenants as residential, with animals and agricultural use being limited, its primary use was residential. This parcel has significant residential improvements as described in the CAMA printout. [Board Record, Hearing Tape; Exhibit B, p. 13; Exhibit R, p. 89].

28. The Assessor indicated the third qualification for consideration was whether the owner of the land had derived annual gross revenue of not less than $500. The Taxpayers furnished the Assessor copies of four checks totaling $4,523.15. [Board Record, Exhibit P, pp. 78-79]. This parcel, however, was part of a larger agricultural operation. The Assessor could not determine what portion of the revenue was attributed to the Taxpayers’ land listed in this appeal. [Board Record, Hearing Tape; Exhibit R, p. 89].

29. The Assessor testified the fourth qualification to be considered for agricultural classification was that “[t]he 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.” The Assessor pointed out that by their own restrictive covenants, the Taxpayers’ land was residential with agricultural use being limited. It was her opinion, therefore, that the primary use of the Taxpayers’ land was residential. [Board Record, Hearing Tape; Exhibit B, p. 13].

30. The Assessor reviewed the records of other small acreage parcels. She testified that only five parcels between 5 and 20 acres in size had an agricultural value. There were 247 other parcels of similar size valued as residential. The Assessor’s Office is receiving more and more applications for agricultural classification. Agricultural status is considered at the time of the application. The Assessor’s office has consistently and uniformly valued these small parcels as residential. [Board Record, Hearing Tape; Exhibit N, pp. 62-63; Exhibit O, pp. 64-70; Exhibit R, p. 89].

31. In conclusion, the Assessor asserted the Taxpayers’ property had activities that appeared to be agricultural but did not meet all four of the requirements for agricultural classification. The agricultural land was divided into parcels and sold with the primary use as residential property and is controlled by restrictive covenants. In the Assessor’s opinion, the Taxpayers’ land was correctly valued as residential. [Board Record, Hearing Tape; Exhibit R, p. 89].

CONCLUSIONS OF LAW: PRINCIPLES OF LAW

32. The Board is required to “[d]ecide all questions that may arise with reference to the construction of any statute affecting the assessment, levy and collection of taxes, in accordance with the rules, regulations, orders and instructions prescribed by the department.” Wyo. Stat. Ann. § 39-11-102.1(c)(iv).

33. The Board’s Rules provide:

[T]he Petitioner shall have the burden of going forward and the ultimate burden of persuasion, which burden shall be met by a preponderance of the evidence….

Rules, Wyoming State Board of Equalization, Chapter 2 § 20.

34. The Board, in interpreting a statute, follows the same guidelines as a court:

We read the text of the statute and pay attention to its internal structure and the functional relationship between the parts and the whole. We make the determination as to meaning, that is, whether the statute’s meaning is subject to varying interpretations. If we determine that the meaning is not subject to varying interpretations, that may end the exercise, although we may resort to extrinsic aids to interpretation, such as legislative history if available and rules of construction, to confirm the determination. On the other hand, if we determine the meaning is subject to varying interpretations, we must resort to available extrinsic aids.

General Chemical v. Unemployment Ins. Comm’n, 902 P.2d 716, 718 (Wyo. 1995).

‘Determining the lawmakers’ intent is our primary focus when we interpret statutes. Initially, we make an inquiry respecting the ordinary and obvious meaning of the words employed according to their arrangement and connection. We construe together all parts of the statute in pari materia, giving effect to each word, clause, and sentence so that no part will be inoperative or superfluous. We will not construe statutes in a manner which renders any portion meaningless or produces absurd results.’ In re WJH, 2001 WY 54, ¶ 7, 24 P.3d 1147, ¶ 7 (Wyo. 2001).

TPJ v. State, 2003 WY 49, ¶ 11, 66 P.3d 710, 713 (Wyo. 2003).

35. The Board considers the omission of certain words intentional on the part of the Legislature, and we may not add omitted words. “[O]mission of words from a statute is considered to be an intentional act by the legislature, and this court will not read words into a statute when the legislature has chosen not to include them.” BP America Production Co. v. Department of Revenue, 2005 WY 60 ¶ 22, 112 P.3d 596, 607 (Wyo. 2005), quoting Merrill v. Jansma, 2004 WY 26, ¶ 29, 86 P.3d 270, 285 (Wyo. 2004). See also Parker v. Artery, 889 P.2d 520 (Wyo. 1995); Fullmer v. Wyoming Employment Security Comm’n., 858 P.2d 1122 (Wyo. 1993). The language which appears in one section of a statute but not another, will not be read into the section where it is absent. Matter of Adoption of Voss, 550 P.2d 481 (Wyo. 1976).

36. It is an elementary rule of statutory interpretation that all portions of an act must be read in pari materia, and every word, clause and sentence of it must be considered so that no part will be inoperative or superfluous. Also applicable is the oft-repeated rule it must be presumed the Legislature did not intend futile things. Hamlin v. Transcon Lines, 701 P.2d 1139, 1142 (Wyo. 1985).

37. The issue raised by the Taxpayers concerns the Assessor’s denial of agricultural classification for their land.

38. 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.”

39. 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.”

40. The classification of land as agricultural requires fulfilment of four statutory requirements:

(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 agricultural purpose;

(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 the producer:

(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 tax year.

(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 supporting documentation.

Wyo. Stat. Ann. § 39-13-103(b)(x) (emphasis added).

41. 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).

42. 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).

43. The Department’s Rules contain this 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).

44. 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 the homesite;

* * *

(x) Parcels of land forty (40) acres or less unless the landowner provides proof that such land should otherwise be classified as agricultural land.

(xi) Land zoned for purposes, which exclude agricultural uses.

Rules, Wyoming Department of Revenue, Chapter 10, § 3(c).

45. 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).

46. With regard to appeals of property tax matters, the Wyoming Supreme Court has stated:

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.

CONCLUSIONS OF LAW - APPLICATION OF PRINCIPLES OF LAW

47. We initially note that the Taxpayers have ignored the 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). Supra, ¶ 44. This burden applies whether or not the landowner chooses to appeal an assessor’s determination of agricultural classification.

A. Present Use for Agricultural Purpose

48. The first statutory requirement for agricultural valuation is the present use 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. 39-13-101(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

Wyo. Stat. Ann. § 39-13-101(a)(viii).

49. In this case, the Taxpayers offered testimony that they had two cuttings of hay from their property and grazed cattle on the land in 2004. These uses of the land are agricultural purposes and meet the requirement of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(I).

B. Not Part of Platted Subdivision

50. 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:

Platted subdivision” [sic] 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 of the parties addressed the Department’s Rule.

51. The exhibits and testimony of record, and the respective briefs provided by the parties, do not adequately address the interpretation and application of Wyo. Stat. Ann. § 39-13-103(b)(x)(B)(II) nor the Department Rule. This lack of discussion and analysis however, based on our conclusions with regard to the other requirements for agricultural classification, does not prevent a final decision in this matter. Infra ¶ 52.

C. Minimum Annual Gross Revenues

52. The third requirement 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 of record consists of copies of the face of four checks made out to the Taxpayers and copies of the Taxpayers’ 2004 federal income tax return with Schedule F, Profit or Loss from Farming, supra, ¶¶ 12, 13, 28. While the checks offered by the Taxpayers indicate an amount more than the minimum gross revenue requirement, their federal income tax return showed no gross revenue from their agricultural operations. A federal income tax return is signed under penalty of perjury. [Board Record p. 112]. There is no information on the face of any of the checks to indicate whether any of the income was associated with the 31 O’Brien Road property as required by the Department’s Rules, Chapter 10, § 3(c)(x). We conclude Taxpayers have not carried their burden of persuasion with regard to the statutory minimum gross revenue for the property at issue.

D. Use Consistent with Size, Location and Capability to Produce

53. 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. § 39-113-103(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), 3(a)(ii)(B)(III), 3(a)(ii)(B)(IV).

54. The pertinent definition of “consistent” is “in agreement or harmony; in accord; compatible.” Webster’s New World College Dictionary, 4^th 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 Wyoming 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).

55. We expressed concern in our prior decision concerning the County Board’s failure to address this fourth statutory requirement. We find it unnecessary to address the issue however, because the Taxpayer’s have failed to meet their burden of proof with respect to the required minimum annual gross revenues.

56. The Assessor relied, in part, on the restrictive covenants as a basis for her decision to classify the Taxpayers’ land as residential. The Taxpayers asserted the covenants restrict further subdivision of their land, but permit agricultural uses. Supra, ¶¶ 15, 16. A review of the restrictive covenants indicates that an Architectural Control Committee is empowered to determine the number of livestock which may be kept on any given property. [Board Record, Exhibit F, Section V, p. 31]. On its face, this provision promotes residential use, restricts agricultural use, and unavoidably acts as a limit on the land’s capability to produce. Land which is truly devoted primarily to agricultural purposes can not be encumbered by restrictive covenants which allow a committee to determine the number of livestock to be kept on any given property.

57. The Taxpayers’ offered testimony regarding similar situated parcels near their property which were receiving agricultural classification. Supra, ¶ 14. 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 for determination is whether these Taxpayers qualify for favorable treatment.

58. The Taxpayers, in summary, have not fulfilled their burden of proof or ultimate burden of persuasion that the property in question qualifies for agricultural status.

ORDER

IT IS THEREFORE HEREBY ORDERED the decision of the Fremont County Assessor denying the Taxpayers’ request for agricultural classification of the property at issue is affirmed.

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 31st day of August, 2006.

STATE BOARD OF EQUALIZATION

_____________________________________

Alan B. Minier, Chairman

_____________________________________

Thomas R. Satterfield, Vice-Chairman

_____________________________________

Thomas D. Roberts, Board Member

ATTEST:

________________________________

Wendy J. Soto, Executive Secretary