Section 350-14-006 - VALUATION OF AGRICULTURAL AND HORTICULTURAL LAND006.01 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; or006.02A(2) Estimated landlord's share of income on a crop/share basis; or006.02A(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; and006.02C(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 land006.05A 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.350 Neb. Admin. Code, ch. 14, § 006