Section 350-50-002 - THE APPRAISAL PROCESSThe appraisal process shall contain, but not be limited to, the following steps:
002.01 Definition of the problem The appraisal process must contain the following steps: definition of the project; preliminary survey and planning; data collection; data analysis; application of the data; and final value estimates.
002.02 Preliminary Survey and Planning The county assessor must conduct an annual review of the quality of appraisal within the county through the use of assessment/sales ratios, coefficients of dispersion, price related differentials, confidence intervals, and on-going cost, income, and market analyses.
002.02A After completing the appraisal quality review, the county assessor must determine the appraisal needs of the county for the following year and inform the county board and the Division by developing a Plan of Assessment.002.02B The county assessor must design, document, and initiate a process to systematically inspect and review each parcel of real property at least once every six years. Classes and subclasses that are not subject to inspection in a given year, must be analyzed and if necessary, adjusted based on market analysis and indicators of the level of value to arrive at assessments that reflect market value.002.03 Data Collection and Analysis The county assessor must identify and document the resources necessary to complete the appraisal project. Planning documents can include the following: the development of appraisal specifications; obtaining the necessary materials; and hiring, training, or contracting for any personnel necessary to accomplish the needed appraisal. All appraisal contracts must comply with this Chapter.
002.04 Application of the data Methods of data collection can include items A-F below.
002.04A Interviews or questionnaires about replacement cost, age of the property, sale price, circumstances and financing of sold properties, and income or expense data for properties which are rented. 002.04B Field visit and inspection of the actual property amenities. The inspection process must take place within view of the property being inspected. The degree of the inspection is determined primarily by the county assessor and described in the plan of assessment, or at the discretion of the inspector during the course of the inspection.002.04C Digital imagery technology. Any changes discovered with these technological tools must be followed up with an on-site inspection. Each digital review must be noted on the property record card and incorporated into the county assessor's six-year inspection and review cycle. As new technology becomes available in the appraisal and assessment field it must be approved by the Property Tax Administrator prior to use in the six-year inspection and review cycle.002.04D Federal, state, or local government entity data including the Farm Service Agency's current land use maps, the Natural Resources Conservation Service's soil information, Nebraska Department of Natural Resource's well registration information, and local Natural Resource District's water and irrigation information. 002.04E Existing property record files including appraisal maintenance and pick-up work. The data must be accurate, current, and relevant to the date of the appraisal.002.04F Any forms filed with the County.002.05 Data Analysis must be included in the valuation methodology to show how the county assessor arrived at value.002.05A To analyze a property's uses and restrictions, the analysis must consider the full description of the physical characteristics of the property and the property rights being valued. Actual value may be determined using professionally accepted mass appraisal methods, including the (1) sales comparison approach, (2) income approach, and (3) cost approach.002.05B The ultimate selection of a predominant approach for use in a mass appraisal should be discussed and defended in the valuation methodology and any deviations from the predominant narrative conclusions should be noted and briefly discussed on an individual basis.002.06 Final Value Estimate Application of the data must include processing, review, and starting value phases for each parcel. The processing phase consists of displaying all relevant data in an organized fashion for each individual parcel on appropriate worksheets and record files. The review phase consists of examining each parcel and the data relevant to that parcel to prepare an estimate of value. The starting value is prepared for each individual parcel.
002.06A Land must be valued as though vacant and available to develop to its highest and best use. Land valuation must be conducted in the manner described in the sales comparison approach. When insufficient market data is available, an income approach such as a land residual technique can be used.002.06B The application of the sales comparison approach includes the comparison and valuation on a unit basis to properties that have not sold but are otherwise physically, functionally, and economically similar. Any necessary adjustments to that base value must be made for dissimilarities.002.06C The application of the cost approach includes the development of a replacement cost new using the prescribed manuals and applying all applicable forms of depreciation developed in the data analysis portion of the appraisal.002.06D The application of the income approach includes comparing all or portions of properties with known rental levels, expenses, and lease terms, to properties which are physically, functionally, and economically similar but are not presently rented or at economic rent. An estimate of economic rent is made, using appropriate rates, multipliers, and adjustments developed in the data analysis portion of the appraisal.002.06E Whether applying the sales comparison, cost, or income approach, an inspection of the property must be completed to assure that all variables and adjustments have been property considered and that equalization with similar properties has been accomplished by using the chosen approach. The final step is the calculation of the value indicated by the application of the chosen approach.002.07 The narrative appraisal report In correlating and reconciling the final values the county assessor or appraiser must examine the preliminary value for every parcel and select the most logical, best supported, and most defendable indication of value based upon the following:
002.07A The amount and reliability of the data collected in each approach to value;002.07B The inherent strengths and weaknesses of each approach to value; and002.07C The relevancy of each approach to the appraisal subject.002.08 The county assessor or appraiser must present a final value estimate at the end of the correlation and reconciliation process. The final value estimate indicates land value, improvement value, a leasehold value if applicable, and the total value.002.09 Informal hearing process. Between January 15 and March 1 counties with a population of at least 150,000 inhabitants, must conduct informal hearings to solicit any undiscovered data relevant to the valuation of the individual property being appraised or to the appraisal in general. To facilitate the informal hearing process a county assessor may choose to employ a referee or referees to act on behalf of the county assessor and/or appraiser.002.09A The county assessor must send a notice of the estimate of final value or post to the county assessor website the estimate of final value notifying the owner or lessee who is responsible for paying property taxes.002.09B The county assessor or appraiser must analyze the impact of any recommended adjustments resulting from informal hearings and extend the adjustments to similar properties to ensure equalization. A supplemental valuation methodology amending the original valuation methodology must be added to the report. The supplemental valuation methodology must describe the changes made as a result of the hearings and further describe general changes made to maintain equalization.002.09C For counties with less than 150,000 inhabitants, the county assessor may conduct informational hearings to solicit any undiscovered data relevant to the valuation of the individual property being appraised or to the appraisal in general.002.10 The county assessor is responsible for implementing these regulations regardless of whether the appraiser is the county assessor, a member of the county assessor's staff, a contracted or shared employee, or an independent contractor. Neb. Rev. Stat. §§ 77-202.11, 77-702, 77-1301.01, 77-1311, and 77-1311.03.
350 Neb. Admin. Code, ch. 50, § 002