County of Webster v. Nebraska Tax Equal. & Rev. Comm.
296 Neb. 751
| Neb. | 2017Background
- Webster County appealed a TERC order increasing the assessed value of the "Majority Land Use Grass" subclass (grassland) in Webster County by 6%, raising the subclass to 72% of market value and overall agricultural land to 69%.
- The Nebraska Property Tax Administrator (Administrator) prepared statistical and narrative reports using a 3-year sales study and, because Webster County had insufficient in‑county sales, included comparable sales from surrounding counties (Adams, Clay, Nuckolls, Kearney, Franklin).
- The Administrator originally recommended a 9% increase; TERC issued a show-cause order and held a hearing where Webster County’s assessor disputed inclusion of three sales (two in‑county sales later reclassified by the county, and one Nuckolls County parcel with timber cover).
- At the hearing, the assessment division defended its methodology: it may use comparable sales from similar market areas, timber-over-grass parcels may still be classified as grassland, and county assessors receive sales rosters and may protest inclusions.
- TERC relied on the Administrator’s reports and voted to increase grassland values by 6%; Webster County argued on appeal the reports were not competent evidence, lacked sales-level detail, and included noncomparable out‑of‑county sales.
- The Nebraska Supreme Court affirmed: it held the Administrator’s narrative and statistical reports were competent evidence, statutes do not require including every individual sale in the report, and Webster County failed to prove the contested out‑of‑county sale was noncomparable.
Issues
| Issue | Plaintiff's Argument (Webster County) | Defendant's Argument (TERC/Administrator) | Held |
|---|---|---|---|
| Whether TERC erred by relying on Administrator reports that did not list each sale used in the analysis | Statute (§ 77‑5016(4)) requires records relied on by TERC be made part of the record; omission of each sale deprived Webster of meaningful review | Statutes governing equalization (§§ 77‑5026, 77‑5027) do not require listing every sale; assessors get rosters and can protest; reports suffice | Reports need not include every sale; Administrator’s narrative/statistics are competent evidence to support TERC |
| Whether the Administrator’s reports were competent evidence to support adjustment | Reports lack the sales‑level data (prices, assessed values, locations), so they are not competent evidence | Reports are designed to show level and quality of assessment; statutory scheme gives assessors opportunity to inspect sales file and protest | Administrator’s reports are competent; statutory process (ros ters, protests, access to sales file, show‑cause hearing) protects counties |
| Whether using out‑of‑county sales was improper because they were not comparable | Some borrowed sales (Nuckolls County) are not geographically or physically comparable (e.g., more rainfall; timber cover) | Administrator may use comparable sales from similar market areas when in‑county sales are inadequate; disputed parcel was classified as grassland by Nuckolls County and fits definition | County failed to prove noncomparability; Administrator permissibly used comparable out‑of‑county sales |
| Who bears burden at show‑cause hearing to rebut Administrator’s report | Terc should not rely on report unless Administrator proves each sale; burden rests on Administrator to justify each inclusion | At a show‑cause hearing, county must demonstrate why TERC should not rely on Administrator’s reports (county bears burden to rebut) | County bears burden to show TERC should not rely on Administrator; Webster failed to meet that burden |
Key Cases Cited
- JQH La Vista Conf. Ctr. v. Sarpy Cty. Bd. of Equal., 285 Neb. 120 (statutory review standard for TERC final decisions)
- Brenner v. Banner Cty. Bd. of Equal., 276 Neb. 275 (agency action arbitrary if made in disregard of facts)
- Blakely v. Lancaster County, 284 Neb. 659 (agency action arbitrary when it disregards its own rules; review standards)
- In re Guardianship & Conservatorship of Kaiser, 295 Neb. 532 (statutory interpretation principles)
- 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 public officers perform duties faithfully)