Section 350-11-005 - VALUATION005.01 The assessor shall annually use comparable sales from within the influenced area or other areas of similar influence to determine the actual value of the agricultural land and horticultural land in the area. 005.01A Actual valuation of agricultural land and horticultural land shall be based on a market analysis of arms length transactions that may include property that sold subject to certain probable and legal purposes and uses. For the purposes of these regulations, probable and legal uses shall mean those which are immediately feasible, and permitted by current zoning or other statutorily permitted uses. The actual value may additionally be influenced by other probable uses that are not yet feasible or legal under current zoning. These include, but are not limited to use of the land for residential (homesite) purposes, use of the land for commercial use purposes, use of the land for industrial use purposes, or use of the land for recreational use purposes.005.02 The assessor shall annually determine the special valuation assessment. The information shall be based upon sales of similar classes or subclasses of agricultural land and horticultural land from agricultural and horticultural areas in which actual value is not subject to influences by other purposes and uses. Sales within the same county that, in the judgment of the assessor, do not have nonagricultural or nonhorticultural influences on the value of agricultural or horticultural land, may be used for market comparison in determining the special valuation assessment. Care should be taken to ensure that the uninfluenced sales represent land that is comparable to the land to which the special valuation assessment is being applied.
005.02A Sales in neighboring counties shall be used in the market comparison approach if all agricultural and horticultural sales within the county have been determined to reflect selling prices that have been influenced by other than agricultural and horticultural purposes and uses.005.02B Special valuation of agricultural and horticultural land shall be based on a market analysis of arms length sales that may include property that sold subject to certain probable and legal agricultural and horticultural purposes and uses. These include, but are not limited to:005.02B(1) Additions to existing land holdings;005.02B(2) Like-kind exchanges (1031 Exchanges);005.02B(3) Location to existing towns or other locations of marketing influences such as grain elevators, grain processors, feedlots, livestock sale barns, livestock buying stations, packing plants, fertilizer dealers, fuel sales, feed supplement sales, and other suppliers of purchased inputs used in farming and ranching;005.03 The assessor shall capitalize net cash rent to determine a valuation based on the earnings of the property from the agricultural or horticultural use only. The valuation indicated by such an income capitalization approach shall be used as the special valuation if the market comparison approach results in a value that reflects a value influenced by purposes and uses other than agricultural or horticultural. Where the differences between the market comparison approach and income capitalization approach is more than a mere difference of opinion the assessor must determine which value most accurately reflects the property's value for agricultural or horticultural purposes. 005.03A The income estimate shall be based upon; 005.03A(1) Typical cash rent for the land capability group observed for the parcel of land;005.03A(2) Typical crop-share rental income based on a typical crop rotation observed for similar land in the county or land manual area including government program payments received. In accounting for government program payments in developing the income estimate, the assessor shall analyze the nature of the government payment and its relationship to the cash rent or the crop-share rental income for the property;005.03A(3) Typical cash rent per animal unit month in the case of grassland use. 005.03B The expenses deducted shall reflect those typical to the land capability group observed for the parcel of land and may include a proration of shared input costs of production if a crop-share income is estimated.005.03C The capitalization rate shall include, but not be limited to: 005.03C(1) An appropriate discount rate for the land use of the parcel of land;005.03C(2) An adjustment for change in land value;005.03C(3) The effective tax rate for the parcel of land; and,005.03C(4) Any other appropriate adjustment to arrive at an overall capitalization rate.005.04 The assessor shall maintain a file of all data used for determining the special and actual valuation. This information shall be filed with the Department of Revenue Property Assessment Division on or before March 1 of each year. The information shall be considered a public record and available for inspection by the Department of Revenue, Property Assessment Division, the Tax Equalization and Review Commission, or any interested person. The file shall include, but not be limited to: 005.04A A determination of the highest and best use of the properties to be valued;005.04B An explanation of the valuation models used in arriving at the value estimates;005.04C A delineation and explanation of "market areas" recognized in the analysis;005.04D An explanation and analysis including documentation of adjustments made to sales to reflect current cash equivalency or typical market conditions;005.04E An explanation and analysis of the estimate of economic rent or net operating income used in an income capitalization approach including estimates of yields, commodity prices, typical crop share, or documentation of cash rents;005.04F An explanation and analysis of typical expenses allowed in an income capitalization approach;005.04G An explanation and analysis of the overall capitalization rate used in an income capitalization approach; and,005.04H Any other information necessary in supporting the estimate of valuations.350 Neb. Admin. Code, ch. 11, § 005