41 P.3d 237 (Idaho 2001), 26493, Roeder Holdings, L.L.C. v. Board of Equalization of Ada County

Docket Nº:26493.
Citation:41 P.3d 237, 136 Idaho 809
Opinion Judge:WALTERS, Justice.
Party Name:ROEDER HOLDINGS, L.L.C., an Idaho Limited Liability Company, Appellant-Respondent, v. BOARD OF EQUALIZATION OF ADA COUNTY, Respondent-Appellant.
Attorney:[136 Idaho 810] Greg H. Bower, Ada County Prosecuting Attorney; Teresa Ann Baker, Deputy Prosecuting Attorney, Boise, for appellant. Teresa Ann Baker argued. Risch, Goss & Insinger, Boise, for respondent. W. John Thiel argued.
Judge Panel:WALTERS,
Case Date:December 28, 2001
Court:Supreme Court of Idaho
 
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Page 237

41 P.3d 237 (Idaho 2001)

136 Idaho 809

ROEDER HOLDINGS, L.L.C., an Idaho Limited Liability Company, Appellant-Respondent,

v.

BOARD OF EQUALIZATION OF ADA COUNTY, Respondent-Appellant.

No. 26493.

Supreme Court of Idaho, Boise.

December 28, 2001.

Rehearing Denied Feb. 15, 2002.

Page 238

[136 Idaho 810] Greg H. Bower, Ada County Prosecuting Attorney; Teresa Ann Baker, Deputy Prosecuting Attorney, Boise, for appellant. Teresa Ann Baker argued.

Risch, Goss & Insinger, Boise, for respondent. W. John Thiel argued.

WALTERS, Justice.

This appeal involves a property tax assessment in Ada County of an undeveloped thirty-acre parcel of land owned by Roeder Holdings, L.L.C. Ada County appeals from a district court judgment, which held that the property qualifies for an agricultural exemption pursuant to I.C. § 63-602(K). We affirm.

I.

BACKGROUND

Roeder Holdings, L.L.C., applied for a real property agricultural tax exemption for the 1998 tax year on a thirty-acre parcel located at 2131 South Cole Road in Boise, with an assessed value of $510,000. That parcel had been part of a sixty-acre tract purchased by Roeder in March of 1996 while the property was zoned commercial M 5, which allowed farming. In November 1996, Roeder applied with the New York Irrigation District to transfer the water right attached to the original sixty acres to another eighty-acre parcel of land owned by Roeder located approximately four miles south of the subject property. Roeder began clearing and leveling the thirty-acre parcel in 1997, anticipating

Page 239

[136 Idaho 811] raising a crop for the upcoming 1998 growing season. Based on the fact that Roeder had transferred the water rights from the property, the Ada County Assessor denied Roeder the agricultural exemption. Roeder appealed. The Ada County Board of Equalization considered Roeder's application on July 10, 1998, and affirmed the County's assessment. Roeder then appealed to the Board of Tax Appeals, which heard the matter on November 5, 1998.

In its Final Decision and Order, dated February 9, 1999, the Board determined that many of the facts in the case were undisputed. The Board, however, focused on three facts: (1) the production of the "crop" was after the 1998 tax year assessment date of January 1, 1998; (2) the harvested "oat hay crop" consisted primarily of weeds versus oats and sold for about $1,000; and (3) the implied "profit" did not consider all of the expenses relevant to a bona fide profit making agricultural enterprise or a complete accounting of the costs of production.

Based on these findings, the Board concluded: "It cannot be said that the land was in a bona fide profit making agricultural production of field crops on January 1, 1998." The Board also concluded that Roeder failed to show by clear and specific evidence that the crop produced was a common agricultural field crop. The Board denied Roeder the requested exemption, and Roeder filed a notice of appeal to the district court.

In the district court proceedings, the parties filed cross motions for summary judgment, focusing on a conflict between a statute and a Tax Commission regulation concerning qualifications for an agricultural exemption. In deciding the applicable standard for determining entitlement to an agricultural exemption, the district court found that the Tax Commission regulation required property for which an agricultural exemption is sought to be part of a bona fide profit making agricultural enterprise, while the statute did not contain that requirement. The district court found that the regulation exceeded the Tax Commission's authority and therefore was unenforceable. The district court thereafter concluded that Roeder Holdings, L.L.C., should be granted an agricultural exemption pursuant to I.C. § 63-602(K). The court entered judgment accordingly, including for the amount of the taxes paid under protest plus interest. Ada County appealed to this Court.

II.

STANDARD OF REVIEW

In a recent opinion, the Court set out the standard for review of agency decisions addressing valuations for tax assessment purposes:

On appeal, this Court, reviews agency decisions independently of appellate decisions by the district court. Willig v. State Dep't of Health & Welfare, 127 Idaho 259, 261, 899 P.2d 969, 971 (1995); Boise Group Homes,...

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