Rural landowners in Sarpy County can claim a victory in their fight against the county assessor.
For years, farmstead owners have complained that County Assessor Dan Pittman treated them unfairly.
The fight is over the value of land under a farmhouse, and Pittman has been raising their taxable values in response to the county's growth. And every year since 2009, when Pittman raised those values, the county's Board of Equalization has sided with him.
This year, though, the farmers won.
The Sarpy County Board of Equalization voted 4-1 last week to reduce the assessed valuations on 36 properties whose farmstead land, the so-called primary acre, had been valued at $58,900. In all, the county cut $1.8 million in property valuation.
Landowners said Pittman's numbers were much too high, and referee Ken Beckstrom agreed. Using a different method that did not assume a premium on the primary acre, Beckstrom recommended reducing the assessed value of those 36 parcels anywhere from 2.2 percent to about 33 percent.
“In the real world, the first acre is not worth any more than the bare ground or any other acre on the property,” he wrote to the board. “In the real world, (an) old set of buildings contribute little or no value to a property.”
While the board's decision affects only those landowners who filed a formal protest this year, it has larger implications for Sarpy County's roughly 800 farms.
For one, it's a signal to farmers — many of whom stopped protesting their valuations after years of failure — that the board is receptive to their concerns. That could encourage more protests.
Indeed, Pittman anticipates a flood.
“I expect that next year, everybody who's in the greenbelt program is going to file a protest,” he said, referring to a law that allows assessors to value farmland near urban areas as agricultural land, which is taxed at a lower rate than is development property.
But he has no plans to change his model, which he said has been validated by state regulators. “It's been upheld all the way down the line,” he said.
Setting a disruptive precedent worried board member Tom Richards of Bellevue, who cast the lone vote against reducing the valuations. If the board abandoned Pittman's model for valuing farmland, he said, why not for commercial and residential property, too?
“How does it work when you're trying to set a budget one day, and the day before that you change the revenue stream?” he asked.
But board member Don Kelly of Papillion said the focus should be on tax relief.
“We can't base decisions on whether some entities are going to get less valuation,” he said. “We've got to base our decisions on what's fair and equitable.”
Jarel Vinduska of rural Gretna hopes the board's decision will embolden other landowners to file protests.
“Next year that'll send a message,” he said. “And we'll correct it for everybody else, too.”
Vinduska said it doesn't make sense to value a farmstead separately from the rest of the farm. And extrapolating the value of one-acre parcels from the sales of larger tracts doesn't provide an accurate reflection of the market, he said.
Pittman “keeps talking about his model, but the model is only as good as the numbers you plug into it,” Vinduska said.
Pittman acknowledged that setting the value on a one-acre rural parcel is difficult. But he said he's doing his best with the data he has and within the confines of the law.
“Farm sites don't sell on their own. You have no one-acre sales,” he said. “But you still have to find a methodology to value those.”
Further, former board member Rusty Hike said, the board's ruling is unfair to other taxpayers.
“If it's a subsidy, let's call it a subsidy,” he said. “But don't call it equalization. ... For the board to go against (Pittman), I think it's a pretty big statement. And I think it's the wrong statement.”
Pittman has 30 days to appeal the board's decision to the State Tax Equalization and Review Commission, but he hasn't decided whether he'll do so.
But because the board voted against him, there's a catch to appealing. If he does appeal, the county would have to hire an outside attorney to represent him, because the county attorney would represent the board, said County Attorney Lee Polikov.
Said Pittman, “I'm really not too terribly inclined to appeal these because of the time and money involved. But if I don't appeal these now, next year, when all 800 or so go to the Board of Equalization, am I going to appeal all those?”