Wyoming Administrative Code › Agency 011 - Revenue Dept › Sub-Agency 0006 - Property Tax › Chapter 9 - PROPERTY TAX VALUATION METHODOLOGY AND ASSESSMENT (COUNTY ASSESSMENTS) › Section 9-4 - Definitions

Current through July 13, 2024
(a) The following
				definitions shall apply:
(i) "Absorption
				Period": The time period at the time of initial offering of the lots until all
				lots are sold. More importantly, the absorption period is an estimate of the
				time frame needed to market the inventory to the eventual end users.
(ii) "Absorption Rate": The rate at which
				properties for sale or lease have been or are expected to be successfully
				marketed, sold, or leased in a given area over a duration of time.
(iii) "Appraiser": A certified Wyoming
				assessing official as designated by Wyoming Department of Revenue, Rules and
				Regulations, Chapter 13.
(iv)
				"Appreciation": An increase in value due to an increase in cost to reproduce,
				value over the cost, or value at some specified earlier point in time, brought
				about by greater demand, improved economic conditions, increasing price levels,
				reversal of depreciating environmental trends, or other factors as defined in
				the market.
(v) "Appraised Value":
				The estimate of the value of a property before application of any fractional
				assessment ratio, partial exemption, or other adjustment.
(vi) "Arms-length Transaction": A transaction
				between unrelated parties who are each acting in his or her own best
				interests.
(vii) "Capitalization
				rate": A ratio between anticipated future income, either accounting income or
				cash flow and present value. Capitalization ratios can be derived from any
				income level, but once they have been so derived they can only be applied to a
				comparable income level. Such rates may be developed by generally accepted
				appraisal methods, to include but not be limited to the following:
(A) By comparing the incomes from recently
				sold comparable properties with their sales prices, adjusted, if necessary, to
				cash equivalents (market derived rate). This method of deriving a
				capitalization rate is preferred when the required sales prices and incomes are
				available.
(B) By deriving a
				weighted average for the cost of debt and equity capital, as reflected in
				appropriate money markets (band-of-investment method), and adding increments,
				when appropriate, for expenses that are excluded from outgo because they
				(expenses) are based on the value that is being sought or the income that is
				being capitalized. The rates for debt and equity capital shall be weighted by
				the respective proportion of such capital usually employed by typical
				prospective purchasers and a capital recapture rate added.
(viii) "Coefficient of Dispersion
				(COD)": The average deviation of a group of numbers from the median expressed
				as a percentage of the median. In ratio studies, the average percentage
				deviation from the median ratio.
(ix) "Comparative unit method":
1) A method of appraising land parcels in
				which an average or typical value is estimated for each stratum of land.
2) A method of estimating
				replacement cost in which all the direct and indirect costs of a structure
				(except perhaps architect's fees) are aggregated and specified with reference
				to a unit of comparison such as square feet of ground area or floor area, or
				cubic content. Separate factors are commonly specified for different intervals
				of the unit of comparison and for different story heights, and separate
				schedules are commonly used for different building types and quality
				classes.
(x) "Computer
				Assisted Mass Appraisal (CAMA)": A system of integrated components and software
				tools necessary to support assessment administration of both real and personal
				property and the appraisal of a universe of properties through the use of
				mathematical models that represent the relationship between property values and
				supply and demand factors.
(xi)
				"Confidence Interval": The level of confidence that the population measure
				(such as the median or mean appraisal ratio) falls in the indicated
				range.
(xii) "Construction Phase":
				The time period when subdivision site infrastructure is installed on the land.
				This could include underground utilities, street storm drainage, water
				retention facilities, open space, common amenities, and other improvements that
				make the individual subdivision lots ready for construction of homes or
				units.
(xiii) "Depreciation": A
				loss of utility and hence value from any cause. Depreciation may take the form
				of physical depreciation, functional obsolescence, or economic obsolescence.
(A) "Physical Depreciation": The physical
				deterioration as evidenced by wear and tear, decay or depletion of the
				property.
(B) "Functional
				Obsolescence": The impairment of functional capacity or efficiency, which
				reflects a loss in value brought about by such factors as defects,
				deficiencies, or super adequacies, which affect the property item itself or its
				relation with other items comprising a larger property.
(C) "Economic Obsolescence (External
				Obsolescence)": Impairment of desirability or useful life arising from factors
				external to the property, such as economic forces or environmental changes
				which affect supply-demand relationships in the market. The methods to measure
				economic obsolescence may include, but are not limited to:
(I) Capitalization of the income or rent loss
				attributable to the negative influence;
(II) Comparison of sales of similar
				properties which are subject to the negative influence with others which are
				not.
(III) Identification of
				factors specifically analogous to the property, i.e. Investments, capacities,
				and/or industry relationships.
(xiv) "Division": Is the Property Tax
				Division.
(xv) "Economic Life": The
				period of time over which an asset's operation is economically
				feasible.
(xvi) "End-user Sale":
				The sale of real estate to an owner-occupant who intends to occupy and use the
				land or building facilities for his or her own purposes, as opposed to a
				speculative investor sale in which real estate is bought as an investment to be
				held with the hope of selling at a profit to an end user in the
				future.
(xvii) "IAAO": Refers to
				The International Association of Assessing Officers.
(xviii) "Infrastructure": Street, water and
				sewer lines, and other public facilities and services necessary for the
				functioning of a community.
(xix)
				"Land Economic Area (LEA)": A geographic area that may encompass a group of
				neighborhoods, defined on the basis that the lands within its boundaries are
				more or less equally subject to a set of one or more economic forces that
				largely determine the value of the lands within this area.
(xx) "Level of Appraisal (LOA)": The common,
				or overall, ratio of appraised values to market values. Three concepts are
				usually of interest: the level required by law, the true or actual level, and
				the computed level based on a ratio study.
(xxi) "Market Adjustment Factors
				(Neighborhood Adjustment Factor)": Market adjustment factors, reflecting supply
				and demand preferences, are often required to adjust values obtained from the
				cost approach to the market. These adjustments should be applied by type of
				property and area and are based on sales ratio studies or other market
				analyses. Accurate cost schedules, condition ratings, and depreciation
				schedules will minimize the need for market adjustment factors..
(xxii) "Mass Appraisal": The process of
				valuing a universe of properties as of a given date using standard methodology,
				employing common data, and allowing for statistical testing.
(xxiii) "Mean": A measure of central
				tendency. The result of adding all the values of a variable and dividing by the
				number of values.
(xxiv) "Median":
				A measure of central tendency. The value of the middle item in an uneven number
				of items arranged or arrayed according to size; the arithmetic average of the
				two central items in an even number of items similarly arranged.
(xxv) "Mobile Machinery": Heavy equipment,
				except shop or hand tools or attachments, which is self-propelled, towed or
				hauled and used primarily in construction and maintenance of roads, bridges,
				ditches, buildings or land reclamation.
(xxvi) "Model": A representation that
				explains the relationship between value or estimated sale price and variables
				representing factors of supply and demand.
(xxvii) "Neighborhood (NBHD)": The
				environment of a subject property that has a direct and immediate effect on
				value and/or a geographic area (in which there are typically fewer than several
				thousand properties) defined for some useful purpose, such as to ensure for
				later multiple regression that the properties are homogenous and share
				important locational characteristics.
(xxviii) "Parameter": Numerical descriptive
				measure of the population, for example, the arithmetic mean or standard
				deviation. Parameters are generally unknown and estimated from statistics
				calculated from a sample of the population.
(xxix) "Parcel": A contiguous area of land
				described in a single legal description or as one of a number of lots on a
				plat; separately owned, either publicly or privately; and capable of being
				separately conveyed.
(xxx) "Point
				of Valuation": The point at which a mineral is brought to the surface of the
				ground and is taken out of the pit, shaft or portal. For surface mine, this
				point shall be the area actually producing a mineral product and will be broken
				down to the nearest legal forty (40) acre subdivision (quarter-quarter). For an
				in situ mine, the point shall be the legal forty (40) acres subdivision, lot or
				tract in which the wellhead or mine is located.
(xxxi) "Present Worth": The present value of
				income that is expected to be received at some future date or dates, as
				ascertained by the process of discounting both the income and the anticipated
				expenses incident to its receipt, that is the amount of money that, if
				presently invested and allowed to accumulate at compound interest would yield
				net income in the same amounts and at the same intervals as is anticipated of a
				given property.
(xxxii) "Ratio
				Study (Sales Ratio Study)": A study of the relationship between appraised or
				assessed values and market values. Ratio studies evaluate the level and
				uniformity of the appraisals or assessments. A sales ratio study uses sales
				prices as proxies for market values, with the appraised/assessed value being
				the numerator and the sales price being the denominator.
(xxxiii) "Raw Land": Land on which no
				improvements have been made; land in its natural state before grading,
				construction, subdivision, or the installation of utilities.
(xxxiv) "Replacement Cost New (RCN)": The
				cost, including material, labor and overhead that would be incurred in
				constructing an improvement having the same utility.
(A) "Direct costs" include, but are not
				limited to, materials, labor, supervision, equipment rentals, installation of
				components, and utilities.
(B)
				"Indirect costs": Include, but are not limited to, architecture and
				engineering, building permits, title and legal expenses, insurance, interest
				and fees on construction loans, taxes incurred during construction, advertising
				and sales expenses, and reasonable overhead and profit.
(xxxv) "Replacement Cost New Less Deprecation
				(RCNLD)": Replacement cost new less physical incurable depreciation and
				external obsolescence.
(xxxvi)
				"Reproduction Cost": The cost of constructing a new property, reasonably
				identical (having the same characteristics) with the given property except for
				the absence of physical depreciation, using the same materials, construction
				standards, design, and quality of workmanship, computed on the basis of
				prevailing prices and on the assumption of normal competency and normal
				conditions.
(xxxvii) "Statistics":
				Numerical descriptive data calculated from a sample, for example, the median,
				mean, or Coefficient of Dispersion. Statistics are used to estimate
				corresponding measures, and termed parameters for the population.
(xxxviii) "Stratify" (stratification, strata,
				stratum): To divide, for purposes of analysis, a sample of observations into
				two or more subsets according to some criterion or set of criteria.
(xxxix) "Time-adjusted sale price": The [rice
				at which a property sold adjusted for the effects of price changes reflected in
				the market between the date of sale and the date of analysis.
(xl) "Trade Level": Refers to the production
				and distribution stages of a product. The appraiser should recognize three
				distinct basic levels of trade: the manufacturing level, the wholesale level,
				and the retail level. Incremental costs (such as freight, overhead, handling,
				installation, and sales taxes paid on installed costs) are added to a product
				as it advances from one level of trade to the next, thereby increasing its
				value as a final, in-service product. Thus the value of good will differ,
				depending on their level of trade. The appraiser should value personal property
				at its current level of trade, theoretically to a buyer within the same level
				of trade.
(xli) "Trended original
				cost method": The procedure for estimating replacement cost of property by
				trending its original or historical cost with a factor from an appropriate
				construction cost index. Subsequent additions and replacements less deductions
				or removals must be considered.
(xlii) "Unit-in-place method": The procedure
				for estimating cost which combines direct and indirect costs into a single
				unit-in-place, which, when multiplied by the area of the portion of the
				building being priced, results in a total cost estimate for that
				portion.