Farmers Co-op v. State, 296 Neb. 347

Farmers Cooperative and Frontier Cooperative sought refunds of Nebraska sales/use taxes paid on repairs and parts for agricultural machinery under Neb. Rev. Stat. § 77-2708.01 (refunds for "depreciable repairs or parts").
The Department of Revenue’s Information Guide defined "depreciable repairs or parts" by reference to the IRS Farmer’s Tax Guide: parts/repairs that appreciably prolong life, arrest deterioration, increase value/usefulness, and are capital expenditures subject to depreciation.
The Department partially denied the Cooperatives’ refund claims for items (e.g., alternators, gaskets, sensors, hoses, air conditioner parts) as nondepreciable; the Department requested proof (personal property tax returns or depreciation schedules) that the items were taxed as personal property.
Neither Cooperative provided property tax returns or depreciation schedules; neither requested an administrative hearing; both appealed the denials to the Lancaster County District Court, which affirmed the Department’s interpretation and partial denials.
The Nebraska Supreme Court consolidated the appeals; the sole legal issue was the meaning of "depreciable repairs or parts" in § 77-2708.01 and whether the Cooperatives proved entitlement to refunds.

Issue	Plaintiff's Argument	Defendant's Argument	Held
How to interpret "depreciable repairs or parts" in § 77-2708.01	Cooperatives: apply broad § 77-119/§ 77-2704.36 concept of "depreciable" (determinable life >1 year) to repairs/parts	Department: follow Information Guide/IRS standard — only capital-type repairs/parts that appreciably prolong life, increase value/usefulness and are depreciable	Court: phrase is ambiguous; legislative history supports Department/IRS-style definition (capital-type items)
Whether claimants must prove items were taxed as personal property to get refund	Cooperatives: statute does not require submission of property tax returns to get refund; they challenged Department’s demand for schedules	Department: claimants bear burden to show entitlement; documentation (property tax return/depreciation schedule) needed to prevent double refund/noncompliance	Court: claimants bear burden; failure to provide property tax or depreciation evidence meant denial was proper

Stewart v. Nebraska Dept. of Rev., 294 Neb. 1010 (addresses standard of review on APA judicial review)
Archer Daniels Midland Co. v. State, 290 Neb. 780 (statutory interpretation principles)
Project Extra Mile v. Nebraska Liquor Control Comm., 283 Neb. 379 (statutory ambiguity and in pari materia analysis)
Trumble v. Sarpy County Board, 283 Neb. 486 (use of statutory definitions)
Dean v. State, 288 Neb. 530 (use of legislative history when statute ambiguous)
State v. Duncan, 294 Neb. 162 (statutory construction principles)
Bridgeport Ethanol v. Nebraska Dept. of Rev., 284 Neb. 291 (tax exemption strict construction)
Goodyear Tire & Rubber Co. v. State, 275 Neb. 594 (analogy of tax exemption to refund burden of proof)