011-7 Wyo. Code R. § 7-4

Current through April 27, 2019

Section 7-4 - Definitions

For the purpose of ad valorem taxation under these rules, the definitions set forth in Title 39, as amended, are incorporated herein by reference. In addition, the following definitions shall apply:

(a) "Best Information Appraisal" means the calculation of taxable value based upon the most recently filed annual report adjusted by other best information available, including:

• (i) The producer price index, if applicable;

• (ii) Recognized financial measures of economic conditions; and

• (iii) Comparison to the most comparable Department assessed companies.

(b) "Department" means the Department of Revenue, the Property Tax Division, and/or its authorized agent.

(c) "Depreciation" means a loss of utility and hence value from any cause. Depreciation may take the form of physical depreciation, functional obsolescence, or external obsolescence.

• (i) "Physical Depreciation" means the physical deterioration as evidenced by wear and tear, decay or depletion of the property.

• (ii) "Functional Obsolescence" means 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.

• (iii) "External Obsolescence" means 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. Methods to measure economic obsolescence include:
  • (A) Capitalization of the income or rent loss attributable to the negative influence;
  • (B) Comparison of sales of similar properties which are subject to the negative influence with others which are not.
  • (C) Identification of factors specifically analogous to the property, i.e. investments, capacities, and/or industry relationships.

(e) "Discount rate" means a firm's opportunity cost or weighted average cost of available capital. A discount rate is used to discount future cash flows back to their present value. A discount rate becomes a capitalization rate with the addition of a capital recapture rate.

(f) "Appreciation" means 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.

(g) "Fair market value" is defined as the amount in cash, or terms reasonably equivalent to cash, that a well informed buyer is justified in paying for a property and a well informed seller is justified in accepting, assuming that neither of the parties thereto are acting under undue compulsion and assuming further that the property has been offered in the market place for a reasonable time.

(h) "Non-operating Property" means all Department assessed companies' property, owned or leased, not used in operations.

(i) "Operating Property" means all property which is owned, leased, or otherwise used exclusively in Department assessed companies' operations.

(j) "Department Appraiser" means Department personnel with specific job responsibilities for appraisal of Department assessed companies' .

(k) "Unitary valuation" is the process of determining the value of a company as a whole without reference to individual parts. The unitary approach is used in the valuation of properties which derive their value from interdependent assets working together. The market value is not a summation of fractional appraisals, but the value of a company as an operating unit.

011-7 Wyo. Code R. § 7-4