980 N.W.2d 611
Neb.2022Background
- Mary and Brad Moser own ~116 acres in Lancaster County ("Mary’s Farm") classified as unimproved agricultural land with subclasses (irrigated cropland, dryland, grassland, wasteland).
- For tax years 2018–2020 the county assessor subclassified portions of Mary’s Farm as irrigated cropland (higher scheduled value); a nearby parcel (the Morrison property) was—erroneously for 2018–2019—subclassified and assessed as dryland despite containing pivots.
- The Mosers protested the 2018–2019 valuations arguing their irrigated acres were overvalued compared to the Morrison property; the County Board affirmed both years (a referee had considered evidence), and affirmed 2020 as well; an unrelated settlement slightly reduced 2018 value.
- The Mosers appealed to the Tax Equalization and Review Commission (TERC). TERC found the Mosers had presented compelling evidence that the Morrison parcel was irrigated and concluded the County Board had a duty to equalize, ordering Mary’s Farm’s irrigated acres be revalued as dryland for 2018 and 2019 (no relief for 2020).
- Lancaster County Board of Equalization appealed to the Nebraska Supreme Court, which reversed TERC: the Court held the Mosers failed to prove by clear and convincing evidence that Mary’s Farm’s valuation was grossly excessive due to a systematic intentional act or failure of a plain legal duty, and that equalizing to replicate an isolated misclassification was inappropriate.
Issues
| Issue | Mosers' Argument | County Board's Argument | Held |
|---|---|---|---|
| Whether Mosers rebutted presumption that the County Board acted on competent evidence | Photographs/property records showed Morrison had pivots and was taxed as dryland, so presumption rebutted | County did not contest that the Mosers’ evidence rebutted presumption (focus on ultimate burden) | Court accepted TERC’s finding that presumption was rebutted but proceeded to next inquiry |
| Whether Mosers proved valuation was grossly excessive compared to similar property | Mary argued her irrigated acres were valued much higher than Morrison, showing gross excess | County argued Morrison was misclassified (dryland) causing difference; Mary’s Farm was correctly classified and valued | Court: Mosers failed to compare Mary’s Farm to legitimately classified irrigated comparables; did not prove gross excess by clear and convincing evidence |
| Whether disparate valuation resulted from systematic intentional conduct or failure of plain legal duty requiring equalization | Mosers/TERC: once shown Morrison was irrigated but valued lower, County Board had duty to equalize (even if that meant lowering Mary’s Farm) | County: misclassification was an isolated, unintentional error by assessor; no systemic misconduct or legal duty to replicate that error across other parcels | Court: no evidence of systemic or intentional undervaluation or of a plain legal duty to replicate an isolated assessor error; TERC’s order was unreasonable and reversed |
| Applicability of Sioux City Bridge (remedy of lowering plaintiff’s assessment when others are undervalued) | Mosers/TERC cited Sioux City Bridge to justify reducing Mary’s Farm to match undervalued Morrison because increasing many underassessed parcels is impracticable | County: Sioux City Bridge differs—that case involved systematic, intentional underassessment of a large mass of property; here error was isolated and corrected later | Court: Sioux City Bridge is distinguishable (federal due process context and systemic underassessment); not applicable here |
Key Cases Cited
- Wheatland Indus. v. Perkins Cty. Bd. of Equal., 304 Neb. 638, 935 N.W.2d 764 (Neb. 2019) (standards for TERC review and presumption of board correctness)
- Betty L. Green Living Trust v. Morrill Cty. Bd. of Equal., 299 Neb. 933, 911 N.W.2d 551 (Neb. 2018) (taxpayer burden and equalization principles)
- JQH La Vista Conf. Ctr. v. Sarpy Cty. Bd. of Equal., 285 Neb. 120, 825 N.W.2d 447 (Neb. 2013) (burden of persuasion in board appeals)
- Newman v. County of Dawson, 167 Neb. 666, 94 N.W.2d 47 (Neb. 1959) (equalization and clear-and-convincing standard language)
- Krings v. Garfield Cty. Bd. of Equal., 286 Neb. 352, 835 N.W.2d 750 (Neb. 2013) (purpose of equalization and uniformity requirement)
- Constructors, Inc. v. Cass Cty. Bd. of Equal., 258 Neb. 866, 606 N.W.2d 786 (Neb. 2000) (uniformity clause interpretation)
- Sioux City Bridge v. Dakota County, 260 U.S. 441 (U.S. 1923) (remedy discussion where mass underassessment makes upward equalization impracticable)