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County of Webster v. Nebraska Tax Equal. & Rev. Comm.
296 Neb. 751
Neb.
2017
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Background

  • Webster County challenged a Tax Equalization and Review Commission (TERC) order that increased the assessed value of the "Majority Land Use Grass" subclass (agricultural grassland) in Webster County by 6%, raising that subclass to 72% and overall ag land to 69% of market value.
  • Nebraska statutes and regulations require the Property Tax Administrator (Administrator) to compile a sales file and produce annual narrative and statistical reports (including level-of-value opinions) for each county; TERC may order adjustments and must give counties a show-cause hearing under § 77-5026.
  • The Administrator’s report recommended a 9% increase for Webster County grassland after using a sample of 17 sales, including four sales "borrowed" from neighboring counties (Adams, Clay, Nuckolls, Franklin, and Kearney) because Webster’s in-county sales were inadequate.
  • At the show-cause hearing the Webster County assessor disputed three sales: two in-county sales she had disqualified after use-change and one Nuckolls County sale with timber cover; the Administrator’s specialist testified those sales were properly included and that timber-over-grass parcels can still qualify as grassland.
  • After receiving supplemental analyses, TERC voted to increase grassland valuations by 6% (below the Administrator’s 9% recommendation). Webster County appealed, arguing the Administrator’s reports were not competent evidence because they omitted raw sales-file details and that some borrowed sales were not comparable.

Issues

Issue Plaintiff's Argument (Webster County) Defendant's Argument (TERC/Administrator) Held
Whether the Administrator’s narrative/statistical reports are competent evidence to support TERC’s adjustment absent inclusion of each underlying sale in the report The reports lacked required detail (each sale, selling price, assessed value, geographic characteristics) and § 77-5016(4) prohibits reliance on undocumented factual material § 77-5027(3) does not require listing every sale; reports need only provide statistical/narrative information and county assessors can access sales file/contest at the § 77-5026 hearing Reports are competent evidence without restating every sale; TERC may rely on them and counties bear the burden at the show-cause hearing to rebut the reports
Whether inclusion of out-of-county or partially wooded sales produced a noncomparable sample Borrowed sales (esp. from Nuckolls County) and a partially wooded parcel were not comparable to Webster County grassland and improperly skewed the level-of-value Statute/regulation permit use of comparable sales from similar market areas; timber-over-grass parcels are classifiable as grassland and Nuckolls had reported the parcel as 80% grassland; Webster failed to present evidence disproving comparability Webster failed to carry burden to show noncomparability; TERC permissibly used those sales and did not act arbitrarily

Key Cases Cited

  • JQH La Vista Conf. Ctr. v. Sarpy Cty. Bd. of Equal., 285 Neb. 120 (statutory review and error-on-the-record standard for TERC decisions)
  • Brenner v. Banner Cty. Bd. of Equal., 276 Neb. 275 (agency action arbitrary when disregarding facts)
  • Blakely v. Lancaster County, 284 Neb. 659 (agency must follow its substantive rules)
  • In re Guardianship & Conservatorship of Kaiser, 295 Neb. 532 (statutory interpretation is question of law)
  • In re Interest of Nizigiyimana R., 295 Neb. 324 (plain-meaning rule for statutes)
  • In re Interest of Tyrone K., 295 Neb. 193 (in pari materia construction of related statutes)
  • Johnson v. Neth, 276 Neb. 886 (presumption that public officers faithfully perform duties)
Read the full case

Case Details

Case Name: County of Webster v. Nebraska Tax Equal. & Rev. Comm.
Court Name: Nebraska Supreme Court
Date Published: May 26, 2017
Citation: 296 Neb. 751
Docket Number: S-16-583
Court Abbreviation: Neb.