3 Or. Tax 333 | Or. T.C. | 1968
Decision rendered for defendant December 27, 1968.
The Polk County Assessor and the State Tax Commission denied a special farm use assessment under *334
ORS
The 14-acre tract on which the special assessment was denied was purchased by plaintiff in 1961 for $15,130 and lies within a farm use zone. Until January 1, 1967, the assessor had given the tract a farm use classification and assessed it under the special provisions of ORS
On December 31, 1966, plaintiff purchased an additional 24 acres of land contiguous to the 14-acre tract and also within the farm use zone. The contract for this purchase, however, was not recorded until December, 1967. The parties agree that this tract was receiving the special assessment as farm land on January 1, 1967.2
The 14-acre parcel and the 24-acre parcel are carried as two separate tax lots. Before plaintiff's purchase the two tracts had been part of a large farm operated by the former owner. The 24-acre parcel was receiving a farm use classification on January 1, 1967, because plaintiff's purchase contract had not been recorded until December, 1967, and the assessor believed the 24 acres were still part of the large farm.
The plaintiff presents three contentions: (1) that *335 the 14-acre tract by itself was entitled to the farm use classification; (2) that the assessor should have considered both tracts of land together for the purpose of determining the farm use classification; and (3) that she was denied uniformity of assessment on the 14-acre tract as required by Art I, § 32, and Art IX, § 1, of the Oregon Constitution.
The undisputed evidence showed that 11 acres of the 14-acre tract were steep, rocky, and not suitable for cultivation. The remaining 3 acres had been planted to grain since 1961. Plaintiff received no income from these 3 acres as they were farmed by the original owner who did some road grading and mowing of weeds in exchange for the crop.
The only income plaintiff received in 1967 from the 24-acre tract acquired in December of 1966, was $60 to $70 from the sale of one ton of prunes.
To be entitled to the farm use classification allowed by ORS
*336"(2) As used in this section, 'farm use' means the use of land for raising and harvesting crops or for the feeding, breeding and management of livestock or for dairying or any other agricultural or horticultural use or any combination thereof and includes the preparation of the products raised thereon for man's use and disposal by marketing or otherwise. It includes the construction and use of dwellings and other buildings customarily provided in conjunction with the farm use."
Complying with the provisions of ORS
It is clear that the 14-acre tract is not entitled to a farm use classification whether it is considered separately or as a whole with the larger parcel. According to the plaintiff's own witness, 11 of the 14 acres are not suitable for cultivation. The remaining 3 acres have yielded nothing for plaintiff except the minor road grading and mowing by the former owner in exchange for the crop. The eligibility of the 14-acre tract for a farm use classification is not enhanced when considered with the other parcel because, with the exception of harvesting one ton of prunes, no farm use was made of the 24-acre parcel during 1967. (Although as mentioned previously, this parcel had received a farm use classification on January 1, 1967, and is not directly involved herein.)
1. It is true that both parcels were within a farm use zone in Polk County; the 14-acre parcel had received a farm use classification until the assessor changed it on January 1, 1967; the 24-acre parcel had received a farm use classification when it was part of a large farm owned by plaintiff's vendor. However, the fact that two parcels of land had or had not received a farm use classification does not mean that in subsequent years in the hands of a different owner or under different conditions the classification of the lands could not be reviewed and the farm use classification allowed or disallowed as the case may be. *337
The more difficult question presented by the plaintiff is whether she has been denied uniformity of assessment of the 14-acre tract in violation of Art I, § 32, and Art IX, § 1, of the Oregon Constitution.
ORS
The Polk County Assessor testified that before he started a review and study of lands within a farm use zone under ORS
2. Relative uniformity of assessment and taxation, not absolute uniformity, is required by the Oregon Constitution and statutes. Robinson v. State Tax Com.,
In Robinson v. State Tax Com., supra, the taxpayer owned an office building which was correctly assessed *338 at true cash value and a competitor's building was grossly undervalued. The taxpayer admitted that with the one exception the valuation of taxpayer's building was comparable and uniform with other buildings of the same class and type. The court held that relative uniformity had been accomplished and that it would be wrong to strike down the correct assessment on plaintiff's property merely because one other building in the area was undervalued.
In Penn Phillips Lands v. Tax Com.,
"While it is generally said that a taxpayer whose assessment complies with the statutes may not claim judicial relief solely because of the failure of the assessor to raise his neighbors' assessments to comply with the same law, there is an exception to this general rule. Arbitrary or systematic discrimination in assessment offends the equal-protection-of-the-law and equal-privileges-and-immunities clauses of the Fourteenth Amendment. Sioux City Bridge v. Dakota County,
260 U.S. 441 ,43 S Ct 190 ,67 L Ed 340 , 28 ALR 979 (1923)."This court has recognized that it would be wrong to strike down a correct assessment merely because one neighbor's property has been underassessed. Robinson et ux v. State Tax Commission,
216 Or. 532 ,538 ,339 P.2d 432 (1959). But we also noted in the same case that there is a distinction between an assessor's error in overlooking one or two properties with a resulting underassessment *339 for the few and the situation where one taxpayer is singled out for assessment at full value while all others are left assessed at lesser values.216 Or at 537 ,339 P.2d 432 ."
A very recent case decided by the Supreme Court of Alabama,M. A. Barnes, Sr. et al v. Dale County Board of Equalization etal,
"Here the record indicates that the Board of Equalization has adopted a plan to equalize the values of all property in Dale County. It has elected to start with residential property. The complainants in this case are, therefore, the first to be affected by the plan to equalize the property assessments in Dale County. But of course it is apparent that the Board cannot instantaneously reassess all property at the same moment. As the trial court noted in the decree rendered in this cause:
" 'While the plan now being followed by the said Board of Equalization, might not be the most ingenious, nor desirable plan for systematic reassessment of all properties within this county, such determination lies within the discretion of this board, and this Court is of the opinion that the board is proceeding in a legal and systematic fashion.'
"We must agree with the trial court that on the state of the record before us, we cannot conclude *340 that the Board of Equalization is not acting in good faith, and that the record does not support the charge that it is deliberately discriminating against residential property owners in having reassessed their property first."
The court in the above case cited and relied uponHamilton v. Adkins,
"We have pointed out that where there is a review of only a portion of the real estate in a county done in good faith and looking to a plan to equalize values of all property as promptly as possible, this should be considered on the question of intentional discrimination." 35 So.2d at 189.
In the instant case it is beyond question that a lack of uniformity in farm use classification existed on January 1, 1967. Many property owners in the zoned *341 area, including at least one adjacent to the plaintiff, were receiving a farm use classification when they were not entitled to it. The tax commission agreed that a lack of uniformity existed and stated in its opinion and order:
"* * * The Assessor admitted the lack of uniformity generally respecting farm use assessment and stated that he had just commenced a review which was designed to ultimately remove the exemption for nonfarm use properties which are now valued on the basis of farm use.
"* * * * *
"* * * The examples given by Petitioner indicate that there is now a lack of uniformity in that certain properties which enjoy special assessment for farm use may not be eligible for special assessment. The Assessor admits that such discrepancies exist. Under the circumstances, uniformity is served in each instance where under the Assessor's review, the privilege of special assessment is removed from a property which is not entitled to it."
3. While uniformity may not have been accomplished as far as plaintiff's 14 acres are concerned, it does not amount to the arbitrary or systematic discrimination necessary in this case to constitute a violation of the Oregon Constitution. Mere inequality in valuation does not contravene constitutional provisions. Hamilton v. Adkins, supra. Arbitrary or systematic discrimination similar to that in Penn Phillips, supra, must be shown. The plaintiff there was the only landowner in all of Northern Lake County to be subjected to special treatment for the tax year 1965. While there was no evidence in Penn Phillips that the assessor deliberately and intentionally singled out the plaintiff for special treatment, the effect was the same.
4. One of the factors to be considered when discrimination *342 is alleged is whether the review of only a portion of the real property in a county was done in good faith looking toward a plan to equalize values of all property as promptly as possible. Hamilton v. Adkins, supra.
In 1966 the Polk County Assessor started his review and study of whether lands within a farm use zone were being used exclusively for farm use and therefore entitled to the farm use classification which they had been receiving. By January 1, 1967, he removed 35 properties from the farm use classification, including plaintiff's 14 acres. He testified that he continued the study during 1967 as time and personnel permitted and by January 1, 1968, had removed another 300 properties from the special farm use classification.
While many inequities existed in farm use classification in this area of Polk County as of January 1, 1967, the assessor was acting in good faith in reviewing the classifications and removing the unqualified properties as soon as time and circumstances permitted. This negates the existence of arbitrary or systematic discrimination in the elimination of plaintiff's property from the farm use classification.
"In short taxing authorities must commence somewhere in the county with some class of taxpayer in order to equalize the entire county." Hamilton v. Adkins, 35 So.2d at 190.
The land involved was not entitled to a farm use classification as of January 1, 1967, and the order of the tax commission is affirmed.
"(1) Any land which is within a farm use zone established under ORS
215.010 to215.190 or 227.210 to 227.310, and which is used exclusively for farm use as defined in subsection (2) of ORS215.203 , shall be assessed at its true cash value for farm use and not at the true cash value it would have if applied to other than farm use."
