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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

Cite as 298 Neb. 166

William Burdess, appellant, v. Washington County

Board of Equalization, appellee.

___ N.W.2d ___

Filed November 3, 2017. No. S-17-026.

1. Taxation: Judgments: Appeal and Error. An appellate court reviews 

decisions rendered by the Tax Equalization and Review Commission for 

errors appearing on the record. When reviewing a judgment for errors 

appearing on the record, an appellate court’s inquiry is whether the decision conforms to the law, is supported by competent evidence, and is not 

arbitrary, capricious, or unreasonable.

2. ____: ____: ____. An appellate court reviews questions of law arising during appellate review of decisions by the Tax Equalization and 

Review Commission de novo on the record.

Appeal from the Tax Equalization and Review Commission. 

Affirmed.

Aaron F. Smeall, of Smith, Gardner & Slusky Law, L.L.P., 

for appellant.

M. Scott Vander Schaaf, Washington County Attorney, and 

Emily A. Beamis for appellee.

Heavican, C.J., Wright, Miller-Lerman, Cassel, Stacy, 

Kelch, and Funke, JJ.

Kelch, J.

I. NATURE OF CASE

William Burdess filed a petition for review of an order made 

by the Nebraska Tax Equalization and Review Commission 

(TERC), which affirmed the valuation of the Washington 

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

11/22/2017 08:10 PM CST
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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

Cite as 298 Neb. 166

County Board of Equalization (Board) wasteland acres and 

homesite acres owned by Burdess for tax years 2013 through 

2016. On review, Burdess argues that Nebraska law requires 

that wasteland acres be valued at $0 per acre and that the 

valuation of his homesite acres is unreasonable because it is 

not equalized with an allegedly comparable homesite property 

located one-half mile away.

II. FACTS

1. Valuation of Land and Protest

This case involves two parcels of land owned by Burdess 

and located in Washington County, Nebraska. Both parcels 

consist of agricultural land, a homesite, a secondary building, and wasteland. The first parcel contains 80 acres of land, 

25.56 of which the parties have stipulated are wasteland. 

The second parcel contains 60 acres of land, 29.12 of which 

the parties have stipulated are wasteland. The wasteland on 

Burdess’ two properties, along with all other wasteland in 

Washington County, was assessed at $290 per acre for tax year 

2013, $335 per acre for tax year 2014, and $450 per acre for 

tax years 2015 and 2016. The homesite acres were assessed 

at $41,000.

Burdess protested the 2013 through 2016 assessed values of 

the two parcels to the TERC, arguing that the wasteland should 

be valued at $0 and that the homesite acres should be assessed 

at a value no higher than another homesite (the “Sully property”) one-half mile away. A hearing was held in November 

2016, and evidence was received.

2. November 2016 Hearing

(a) Value of Wasteland

At the hearing, Burdess testified that the wasteland was not 

cultivatable or profitable, but was instead used for mushroom 

hunting and walnut-tree harvesting. Burdess testified that he 

permitted family members and friends to hunt and gather 

mushrooms on the land, but did not charge anyone any money 
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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

Cite as 298 Neb. 166

to do so. Burdess also testified that he had earned approximately $7,500 over the past 50 years selling a few walnut trees 

on the property, none of which was earned during the tax years 

at issue. Burdess testified that he had some immature walnut 

trees still on the property, but that it takes 75 to 100 years for 

the trees to mature and have any significant value.

On behalf of the Board, the Washington County assessor 

testified at the hearing. He explained that because Burdess 

had elected “special value,” Burdess’ wasteland acres were not 

valued according to their market value, but according to their 

special value. “Special valu[e]” is the “value that land would 

have for agricultural or horticultural purposes or uses without 

regard to the actual value the land would have for other purposes or uses.”1

 Accordingly, special value does not take into 

account urban development potential.

The assessor testified that in order to determine the special 

value for properties in Washington County, he looked to the 

values of property in other counties, such as Burt County, 

Nebraska, where there is less development potential. The assessor testified that he assessed the wasteland acres based upon 

actual sales of farmland containing wasteland acres in Burt 

County and then increased the per acre value in proportion to 

the increases in the value of other classes of property, such as 

dryland or irrigated land.

(b) Value of Homesite Acres

Burdess’ homesite acres were assessed at $41,000 for each 

of the 4 tax years at issue. The Sully property was assessed 

at $27,000 for tax year 2014. Testimony at the hearing established that both are farm properties, zoned agricultural, and 

that they are located one-half mile apart.

The assessor testified that the difference in their valuation was due to their location and the difference in the terrain. Despite the properties’ proximity to each other, they 

1 Neb. Rev. Stat. § 77-1343(5) (Reissue 2009).
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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

Cite as 298 Neb. 166

are located within different market areas within the county. 

Burdess’ homesite is located within “Market Area 6,” and the 

Sully property is located within “Market Area 7,” which is 

classified as a flood plain. The assessor testified that the Sully 

property is located on a river bottom, while Burdess’ property 

is located on a bluff, and that people will not pay as much to 

build on the river bottom.

Burdess testified that the Sully property has “never flooded 

in 52 floods” because “the building site . . . is on high ground.” 

He compared that to his property, which was flooded by a 

creek in 1999 and 2016.

3. TERC’s December 2016 

Order and Appeal

In December 2016, the TERC affirmed the Board’s decision as to the value of the wasteland and homesite acres. The 

TERC found that Burdess did not produce clear and convincing evidence that the wasteland should have been assessed 

and valued at $0 per acre. The TERC also found that the 

homesite acres did not warrant value equalized to the Sully 

property’s because the properties are located in two different 

market areas with significantly different physical characteristics. Burdess appeals.

III. ASSIGNMENTS OF ERROR

Burdess assigns that the TERC erred in its valuation of the 

wasteland and in its valuation of the homesite acres associated 

with the property.

IV. STANDARD OF REVIEW

[1,2] “We review TERC decisions for errors appearing on 

the record.”2 When reviewing a judgment for errors appearing 

on the record, our inquiry is whether the decision conforms 

to the law, is supported by competent evidence, and is not 

2 Lozier Corp. v. Douglas Cty. Bd. of Equal., 285 Neb. 705, 708, 829 

N.W.2d 652, 655 (2013).
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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

Cite as 298 Neb. 166

arbitrary, capricious, or unreasonable.3 We review questions of 

law arising during appellate review of decisions by the TERC 

de novo on the record.4

V. ANALYSIS

Burdess argues that the TERC erred in its valuation of the 

wasteland and in its valuation of the homesite associated with 

the property. We address each of these arguments in turn.

1. Wasteland

Before beginning our analysis, we note that “wasteland” is 

a subclass of “agricultural and horticultural land.”5 “Wasteland 

includes land that [is] not suitable for agricultural or horticultural purposes.”6

Neb. Rev. Stat. § 77-201(1) (Cum. Supp. 2016) sets forth 

the general rule that all real property, unless expressly exempt, 

is subject to taxation and is to be valued at its actual value. 

However, pursuant to the authority granted by our State 

Constitution,7 the Legislature has made agricultural land and 

horticultural land a separate and distinct class of property for 

purposes of property taxation.8 While most real property is 

valued for taxation purposes at 100 percent of its actual value 

(“[a]ctual value” is “the market value of real property in the 

ordinary course of trade”9), the Legislature has determined 

that agricultural land and horticultural land shall be valued 

3 Lozier Corp, supra note 2.

4 Id.

5 See Neb. Rev. Stat. § 77-1359(1) (Cum. Supp. 2016) (“[a]gricultural 

land and horticultural land means a parcel of land . . . which is primarily 

used for agricultural or horticultural purposes, including wasteland lying 

in or adjacent to and in common ownership or management with other 

agricultural land and horticultural land”) (emphasis supplied).

6 350 Neb. Admin. Code, ch. 14, § 002.54 (2007).

7 See Neb. Const. art. VIII, § 1.

8 § 77-1359. See, also, Neb. Const. art. VIII, § 1(4).

9 Neb. Rev. Stat. § 77-112 (Reissue 2009).
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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

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at 75 percent of its value.10 And the Legislature has further 

distinguished agricultural land and horticultural land from 

other types of real property by allowing the owners of certain 

agricultural land and horticultural land (land that meets the 

qualifications set forth in Neb. Rev. Stat. § 77-1344 (Reissue 

2009)) to elect “[s]pecial valuation,” rather than having their 

properties valued according to their actual value.

“Special valuation means the value that the land would have 

for agricultural or horticultural purposes or uses without regard 

to the actual value the land would have for other purposes or 

uses.”11 This is in contrast to “[a]ctual value,” which takes into 

account “all the uses to which the real property is adapted and 

for which the real property is capable of being used.”12

The special valuation statutes13 were enacted because 

of the economic impact that urban development and other 

nonagricultural development have on neighboring agricultural 

and horticultural land.14 Special valuation protects persons 

engaged in agricultural endeavors from excessive tax burdens 

that might force them to discontinue those endeavors.15

Because Burdess has elected special valuation, the value of 

his agricultural land, including his wasteland, must be valued 

under the special valuation statutes.

Burdess argues that Nebraska law requires that the special 

value of wasteland acres must be $0 per acre. In support of this 

argument, Burdess relies solely on Neb. Const. art. VIII, § 1(5), 

which authorizes the Legislature to enact § 77-1343. In turn, 

§ 77-1343(5) defines “[s]pecial valuation” as “the value that 

the land would have for agricultural or horticultural purposes 

10 § 77-201.

11 § 77-1343(5).

12 § 77-112. 

13 Neb. Rev. Stat. §§ 77-1343 to 77-1347.01 (Reissue 2009 & Cum. Supp. 

2016).

14 350 Neb. Admin. Code, ch. 11, § 001 (2007).

15 Id.
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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

Cite as 298 Neb. 166

or uses without regard to the actual value the land would have 

for other purposes or uses.” Because Burdess’ wasteland is 

“not suitable for agricultural or horticultural purposes,”16 he 

argues that it must necessarily be valued at $0 per acre.

However, Burdess ignores the statutory provisions that dictate how special value is to be determined. Section 77-201(3) 

sets forth that certain agricultural land and horticultural land, 

such as Burdess’ wasteland, shall be valued for taxation at 

75 percent of its special value. Regarding calculation of special value, § 77-1346 sets forth that the “Tax Commissioner 

shall adopt and promulgate rules and regulations to be used 

by county assessors . . . in determining the special valuation of such land for agricultural or horticultural purposes 

under section 77-1344.” Thus, to determine whether the Board 

was arbitrary, capricious, or unreasonable in its valuation of 

the wasteland, we must turn to 350 Neb. Admin. Code, ch. 

11, § 005 (2007), which sets forth how special value is to 

be determined.

Subsection 005.02B of 350 Neb. Admin. Code, ch. 11, provides that “[s]pecial 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.”

Here, the assessor determined the special value of Burdess’ 

wasteland by valuing it based on a market analysis of arm’slength sales of property sold subject to certain probable and 

legal agricultural purposes and uses. Specifically, the assessor used actual sales of farmland containing wasteland in a 

nearby county (Burt County) where urban development had 

little influence on the price of sales. Burdess does not dispute the value of these sales or argue that the Burt County 

property was not comparable to his. In sum, he has failed 

to show that the Board’s valuation was arbitrary, capricious, 

or unreasonable.

16 See 350 Neb. Admin. Code, supra note 6.
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BURDESS v. WASHINGTON CTY. BD. OF EQUAL.

Cite as 298 Neb. 166

Per our standard of review, the question presented is whether 

the TERC’s decision to affirm the Board’s valuation of the 

wasteland was based on competent evidence. We find that 

it was. Therefore, Burdess’ first assignment of error is without merit.

2. Homesite Acres

Burdess also argues that the homesite acres were not properly valued because they should have been valued similarly to those of the Sully property. Burdess argues that the 

Sully property is comparable to his homesite acres because 

both properties are zoned agricultural and they are one-half 

mile apart.

However, despite their similarities and proximity, we agree 

with the Board that Burdess’ property and the Sully property 

have sufficient differences to justify the $14,000 difference in 

valuation. The assessor testified that the properties are located 

in different market areas; that the Sully property is located 

on a river bottom, while Burdess’ property is located on a 

bluff; and that people will not pay as much to build on the 

river bottom.

Competent evidence supports the TERC’s decision to affirm 

the Board’s valuation of Burdess’ homesite acres. The assessor 

testified that he based his valuation of Burdess’ homesite acres 

on the sale of similarly sized parcels within the same market 

area. Although the valuation of Burdess’ homesite acres may 

not be as low as Burdess would like, the TERC’s decision to 

affirm the Board’s valuation of Burdess’ homesite acres was 

not arbitrary, capricious, or unreasonable. Therefore, Burdess’ 

second assignment of error is without merit.

VI. CONCLUSION

For the reasons stated above, we find no errors appearing 

on the record. Therefore, the TERC’s December 2016 order 

is affirmed.

Affirmed.