Nebraska Administrative Code
Topic - REVENUE, DEPARTMENT OF
Title 350 - Nebraska Department of Revenue, Property Assessment Division
Chapter 14 - Agricultural Land and Horticultural Land Assessment Regulations
Section 350-14-006 - VALUATION OF AGRICULTURAL AND HORTICULTURAL LAND
Universal Citation: 350 NE Admin Rules and Regs ch 14 ยง 006
Current through September 17, 2024
006.01 A market or sales comparison approach may be used to determine the actual value for each class and subclass of agricultural and horticultural land.
006.01A
A valuation per unit of comparison, or per land capability group, may be made
based on matched pairs analysis of comparable sales.
006.02 The income approach to valuation may be used to determine the actual value for each class and subclass of agricultural and horticultural land.
006.02A
An estimate of potential gross income is made from:
006.02A(1) Typical cash rents for comparable
land; or
006.02A(2) Estimated
landlord's share of income on a crop/share basis; or
006.02A(3) For grassland, the rent should be
based on animal unit months.
006.02B Typical expenses are deducted from
the estimate of gross income to arrive at net income to the
landowner.
006.02C Indicated net
income is capitalized or divided by the appropriate capitalization rate to
estimate the value of the parcel.
006.02C(1)
Capitalization rate must consider:
006.02C(1)(a) Market derived discount
rate;
006.02C(1)(b) Market derived
rate of change;
006.02C(1)(c)
Market derived sinking fund rate; and
006.02C(1)(d) Appropriate effective tax
rate.
006.03 Reconciliation of final value is based on the appropriateness of the approach to value (market is preferred in the valuation of agricultural land) and the availability and reliability of the information used in each approach.
006.04 Miscellaneous land use adjustments
006.04A Tree Canopy-Land with less than
thirty-five (35) percent tree canopy should be classified as grassland. A
market analysis will demonstrate if any adjustments are needed. Some soil
mapping units consider tree canopy as typical and this has been considered when
classifying the land into LCG's. A determination will need to be made whether
tree canopy along rivers and streams is used as agricultural land, timberland,
or recreational land.
006.04B Soil
Spot Symbols-Most soil surveys show some spot symbols on soil maps that are
used to indicate special soil conditions that are not typical for the soil in
the area. The symbols are used to show small areas of wet spots, alkali spots,
saline areas, severely eroded areas, sand spots, gravelly areas, rock outcrops,
small blowouts, or other conditions for which an adjustment in land value may
be necessary. The symbol is used for areas that are too small to delineate, but
are significant to the use of the soil in the area. Each county will need to
review the spot symbols that are mapped in their county to determine if an
adjustment is necessary and how much of an adjustment should be applied. If an
adjustment is warranted, it is applied to all areas affected.
006.04C Other sub-classifications may be
recognized in order to achieve proportionate market value. Examples of the
sub-classifications include, but are not limited to:
006.04C(1) Irrigation from sources other than
the parcel being assessed shall be classified as other properties by soil type;
however, the market value should be based on transactions of irrigated land
which is under the same limitation as to availability of water source for
irrigation.
006.04C(2) Irrigable
land as defined in REG 14-002.38 may be considered a sub-classification. The
value of the land should reflect the current market value recognized for other
similarly situated land that has the potential to be irrigated but is not
currently irrigated.
006.04C(3)
Conservation Reserve Program (CRP) Land, Conservation Reserve Enhancement
Program (CREP), Environmental Quality Incentives Program (EQIP) and other lands
which have been enrolled in a federally or state funded program that encourages
the development of specific conservation practices in exchange for a guaranteed
or contracted annual payment. This land is to be classified at its current use;
usually grassland uses. The value for this land should be based on the current
market value for land subject to similar restrictions and similar
payments.
006.04C(4) Parcel size or
shape may be detrimental to the value of the parcel for agricultural and
horticultural use, while the market may indicate a higher value for smaller
tracts as for other uses. Often small irregular shaped parcels are farmed in
conjunction with the adjoining farmland rather than being left idle. These
parcels shall be valued based on the classification of the soils as determined
in the market analysis.
006.04C(5)
Parcel location may affect the value of a parcel. The soil shall be classified
as other like soils, but the value should reflect the market for properties
with similar location limitations or enhancements.
006.05 Assessment of agricultural land and horticultural land
006.05A Valuations
shall be developed in consideration of land capability group and market area,
within a county in order to value all property at or near the statutorily
required level of value.
006.05B
Land which has been determined to meet the definition of being agricultural
land or horticultural land in use shall be assessed at seventy-five (75)
percent of the market value.
006.05B Land not meeting the definition of
agricultural land or horticultural land in use shall be assessed at one hundred
(100) percent of the market value.
Disclaimer: These regulations may not be the most recent version. Nebraska may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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