Chapter 70

70.32(2)(a)5. 5. Undeveloped.

70.32(2)(a)5m. 5m. Agricultural forest.

70.32(2)(a)6. 6. Productive forest land.

70.32(2)(a)7. 7. Other.

70.32(2)(c) (c) In this section:

70.32(2)(c)1d. 1d. “Agricultural forest land” means land that is producing or is capable of producing commercial forest products, if the land satisfies any of the following conditions:

70.32(2)(c)1d.a. a. It is contiguous to a parcel that has been classified in whole as agricultural land under this subsection, if the contiguous parcel is owned by the same person that owns the land that is producing or is capable of producing commercial forest products. In this subdivision, “contiguous” includes separated only by a road.

70.32(2)(c)1d.b. b. It is located on a parcel that contains land that is classified as agricultural land in the property tax assessment on January 1, 2004, and on January 1 of the year of assessment.

70.32(2)(c)1d.c. c. It is located on a parcel at least 50 percent of which, by acreage, was converted to land that is classified as agricultural land in the property tax assessment on January 1, 2005, or thereafter.

70.32(2)(c)1g. 1g. “Agricultural land” means land, exclusive of buildings and improvements and the land necessary for their location and convenience, that is devoted primarily to agricultural use.

70.32(2)(c)1i. 1i. “Agricultural use” means agricultural use as defined by the department of revenue by rule and includes the growing of short rotation woody crops, including poplars and willows, using agronomic practices.

70.32(2)(c)1k. 1k. “Agronomic practices” means agricultural practices generally associated with field crop production, including soil management, cultivation, and row cropping.

70.32(2)(c)1m. 1m. “Other,” as it relates to par. (a) 7., means buildings and improvements; including any residence for the farm operator’s spouse, children, parents, or grandparents; and the land necessary for the location and convenience of those buildings and improvements.

70.32(2)(c)2. 2. “Productive forest land” means land that is producing or is capable of producing commercial forest products and is not otherwise classified under this subsection.

70.32(2)(c)3. 3. “Residential” includes any parcel or part of a parcel of untilled land that is not suitable for the production of row crops, on which a dwelling or other form of human abode is located and which is not otherwise classified under this subsection.

70.32(2)(c)4. 4. “Undeveloped land” means bog, marsh, lowland brush, uncultivated land zoned as shoreland under s. 59.692 and shown as a wetland on a final map under s. 23.32 or other nonproductive lands not otherwise classified under this subsection.

70.32(2r) (2r) Agricultural land shall be assessed according to the income that could be generated from its rental for agricultural use.

70.32(3) (3) Manufacturing property subject to assessment under s. 70.995 shall be assessed according to that section.

70.32(4) (4) Beginning with the assessments as of January 1, 2004, agricultural forest land shall be assessed at 50 percent of its full value, as determined under sub. (1), and undeveloped land shall be assessed at 50 percent of its full value, as determined under sub. (1).

70.32(5) (5) Beginning with the assessments as of January 1, 2017, the assessor shall assess the land within a district corridor described under s. 88.74 in the same class under sub. (2) (a) as the land adjoining the corridor, if the adjoining land and the land within the corridor are owned by the same person.

70.32 History History: 1973 c. 90; 1977 c. 29, 418; 1979 c. 34; 1981 c. 20, 390; 1983 a. 36; 1983 a. 275 s. 15 (8); 1983 a. 410; 1985 a. 54, 153; 1991 a. 39, 316; 1993 a. 337; 1995 a. 27, 201, 227; 1999 a. 9; 2001 a. 109; 2003 a. 33, 230; 2009 a. 177, 235, 276, 401; 2013 a. 80; 2017 a. 115.

70.32 Cross-reference Cross-reference: See also ch. Tax 18, Wis. adm. code.

70.32 Annotation When market value is established by a fair sale of the property or sales of reasonably comparable property are available, it is error for an assessor to resort to other factors to determine fair market value, although such factors in the absence of such sales would have a bearing on market value. Rules on judicial review of valuation presuppose that the method of evaluation is in accordance with the statutes; hence errors of law should be corrected by the court on certiorari and the failure to make an assessment on the statutory basis is an error of law. State ex rel. Markarian v. City of Cudahy, 45 Wis. 2d 683, 173 N.W.2d 627 (1970).

70.32 Annotation While a sale establishes value, the assessment still has to be equal to that on comparable property. Sub. (2) requires the assessor to fix a value before classifying the land; it does not prohibit the assessor from considering the zoning of the property when it is used for some other purpose. State ex rel. Hensel v. Town of Wilson, 55 Wis. 2d 101, 197 N.W.2d 794 (1972).

70.32 Annotation In making an assessment based on a recent sale of the property, the assessor cannot increase the value because no commission was paid to a broker. State ex rel. Lincoln Fireproof Warehouse Co. v. Board of Review, 60 Wis. 2d 84, 208 N.W.2d 380 (1973).

70.32 Annotation Under an option agreement, the sellers’ right to repurchase their homestead and their right of first refusal for the purchase of industrial buildings to be constructed on the property were factors going only to the willingness of the parties to deal, not their compulsion to do so; the value of these rights, together with the monetary amount per acre, comprised the total sale price of the land. State ex rel. Geipel v. City of Milwaukee, 68 Wis. 2d 726, 229 N.W.2d 585 (1975).

70.32 Annotation Evidence of net income from unique property was admissible to show market value. An assessor’s unconfirmed valuation based on estimated replacement cost less depreciation could not stand alone because of uncontroverted evidence of actual costs of recent construction. Rosen v. City of Milwaukee, 72 Wis. 2d 653, 242 N.W.2d 681 (1976).

70.32 Annotation When there are no actual sales, cost, depreciation, replacement value, income, industrial conditions, location and occupancy, sales of like property, book value, insurance carried, value asserted in a prospectus, and appraisals are all relevant to determination of market value for assessment purposes. State ex rel. Mitchell Aero, Inc. v. Board of Review, 74 Wis. 2d 268, 246 N.W.2d 521 (1976).

70.32 Annotation District-wide use of comparative sales statistics to determine annual percentage increases of assessments was invalid under sub. (1). State ex rel. Kaskin v. Board of Review, 91 Wis. 2d 272, 282 N.W.2d 620 (Ct. App. 1979). See also Lloyd v. Board of Review, 179 Wis. 2d 33, 505 N.W.2d 465 (Ct. App. 1993).

70.32 Annotation An assessor erred in failing to consider disadvantages and liabilities that affect the fair market value of dams. State ex rel. Wisconsin Edison Corp. v. Robertson, 99 Wis. 2d 561, 299 N.W.2d 626 (Ct. App. 1980).

70.32 Annotation The lease of comparable property constituted the “best information” regarding fair market value of leasehold improvements. State ex rel. Keane v. Board of Review, 99 Wis. 2d 584, 299 N.W.2d 638 (Ct. App. 1980).

70.32 Annotation Sub. (1) requires the use of a cash equivalency adjustment in assessing property based upon the sale of comparable properties. State ex rel. Flint Building Co. v. Kenosha County Board of Review, 126 Wis. 2d 152, 376 N.W.2d 364 (Ct. App. 1985).

70.32 Annotation An assessment largely based upon consideration of equalized value was invalid. The court erred by remanding with the requirement that a new assessment consider the actual subsequent sale of the subject property. State ex rel. Kesselman v. Board of Review, 133 Wis. 2d 122, 394 N.W.2d 745 (Ct. App. 1986).

70.32 Annotation The board of review erred as a matter of law by basing an assessment on “market” rental income when there was a recent arms-length sale of the property. Darcel, Inc. v. City of Manitowoc Board of Review, 137 Wis. 2d 623, 405 N.W.2d 344 (1987).

70.32 Annotation In determining market value under sub. (1), the board of review must determine whether financing arrangements between the seller and buyer affected the sale price; sub. (1) prohibits assessment exceeding market value. Flood v. Village of Lomira, 153 Wis. 2d 428, 451 N.W.2d 422 (1990).

70.32 Annotation A tax assessment under sub. (1) may include as a component of value the property’s transferable income-producing capacity that is reflected by a recent sale. The key of the analysis is whether the value is appended to the property and is thus transferable with the property or whether it is, in effect, independent of the property so that the value either stays with the seller or dissipates upon sale. In this case, a shopping mall’s reason for existence—namely, the leasing of space to tenants and related activities such as trash disposal, baby stroller rentals, etc.—was a transferable value that was inextricably intertwined with the land, just as the transferable value of a farm—the growing of crops—is inextricably intertwined with the property from which the farm operates. State ex rel. N/S Associates v. Board of Review, 164 Wis. 2d 31, 473 N.W.2d 554 (Ct. App. 1991).

70.32 Annotation This section establishes a unitary taxing scheme; mineral rights are taxed as an element of the real estate and not separately. Cornell University v. Rusk County, 166 Wis. 2d 811, 481 N.W.2d 485 (Ct. App. 1992).

70.32 Annotation The capitalization of income method, based on estimated market rents rather than on actual rent, was an improper method of assessing subsidized rental property. Metropolitan Holding Co. v. Board of Review, 173 Wis. 2d 626, 495 N.W.2d 314 (1993).

70.32 Annotation Compliance with the s. 73.03 (2a) assessment manual is not a defense when the method of assessment violates sub. (1). Metropolitan Holding Co. v. Board of Review, 173 Wis. 2d 626, 495 N.W.2d 314 (1993).

70.32 Annotation When an assessor disavows the correctness of a valuation of comparable property shown on the tax roll, the burden is on the assessor to explain why the assessment is incorrect. State ex rel. Brighton Square Co. v. City of Madison, 178 Wis. 2d 577, 504 N.W.2d 436 (Ct. App. 1993).

70.32 Annotation A taxpayer challenging an assessment has the burden of proving that a sale was an arm’s-length transaction. The taxpayer has the burden of proof on each assessment manual condition that must be met. Doneff v. City of Two Rivers Board of Review, 184 Wis. 2d 203, 516 N.W.2d 383 (1994).

70.32 Annotation The use of owner-operator income to value property is allowed if the net income reflects the property’s chief source of value, the income is produced without skill of the owner, or the owner’s skill and labor are factored out and other valuation approaches are considered. Waste Management of Wisconsin, Inc. v. Kenosha County Board of Review, 184 Wis. 2d 541, 516 N.W.2d 695 (1994).

70.32 Annotation There is no bright line rule for the number of comparable properties that must be shown to prove that the rule of uniformity is being violated. Assessments that are discriminatory and made based on arbitrary and improper considerations cannot stand. State ex rel. Levine v. Board of Review, 191 Wis. 2d 363, 528 N.W.2d 424 (1995).

70.32 Annotation Property that is encumbered by a bundle of rights must be appraised at its value using the current value of that bundle of rights. City of West Bend v. Continental IV Fund Ltd. Partnership, 193 Wis. 2d 481, 535 N.W.2d 24 (Ct. App. 1995).

70.32 Annotation Real property shall be valued based on the best information available. The best information is a recent arms-length sale of the property, followed by recent sales of comparable property. If either of those are not available, the assessor may look to all factors that collectively have a bearing on the value of the property. State ex rel. Campbell v. Township of Delavan, 210 Wis. 2d 239, 565 N.W.2d 209 (Ct. App. 1997), 96-1291.

70.32 Annotation Equalized value is not a measure of fair market value of individual properties; it is improper for an assessor to take it into account in valuing property. Noah’s Ark Family Park v. Board of Review, 210 Wis. 2d 301, 565 N.W.2d 230 (Ct. App. 1997), 96-1074.

70.32 Annotation Affirmed. 216 Wis. 2d 387, 573 N.W.2d 852 (1998), 96-1074.

70.32 Annotation For purposes of the uniformity clause, there is only one class of property. The burden of taxation must be borne as nearly as practicable among all property, based on value. Compliance with the requirement of s. 70.05 (5) that property be assessed at fair value at least once every five years is not a substitute for compliance with the uniformity clause and sub. (1). Approving an increased assessment for only one property despite evidence that it and other properties had recent sales at a price above prior assessments violated the law, and its approval by the board of review was arbitrary. Noah’s Ark Family Park v. Board of Review, 210 Wis. 2d 301, 565 N.W.2d 230 (Ct. App. 1997), 96-1074.

70.32 Annotation Affirmed. 216 Wis. 2d 387, 573 N.W.2d 852 (1998), 96-1074.

70.32 Annotation It was improper to rely solely on insurance replacement value to set the valuation of low income apartments encumbered with income and rental restrictions, although it was a relevant factor. Walworth Affordable Housing, LLC v. Village of Walworth, 229 Wis. 2d 797, 601 N.W.2d 325 (Ct. App. 1999), 98-2535.

70.32 Annotation Income that is attributable to land, rather than personal to the owner, is inextricably intertwined with the land and is transferable to future owners. This income may be included in the land’s assessment because it appertains to the land. Income from managing separate off-site property may be inextricably intertwined with land and subject to assessment if the income is generated primarily on the assessed property itself. ABKA Ltd. Partnership v. Board of Review, 231 Wis. 2d 328, 603 N.W.2d 217 (1999), 98-0851.

70.32 Annotation The requirement to use the “best information” does not require that an assessor use actual figures in the absence of a sale. An assessor acted properly in using estimated expense figures when actual figures did not reflect regular expenses. ABKA Ltd. Partnership v. Board of Review, 231 Wis. 2d 328, 603 N.W.2d 217 (1999), 98-0851.

70.32 Annotation It is clear from the Property Assessment Manual that assessors should consider many market factors from a variety of sources when gathering and applying comparable sales information. Even sales prices of similar properties need some adjustment in order to arrive at an estimate of value for a different property. Joyce v. Town of Tainter, 2000 WI App 15, 232 Wis. 2d 349, 606 N.W.2d 284, 99-0324.

70.32 Annotation When valuing subsidized housing, assessors are required to consider the effects the property’s restrictions have on value. Bloomer Housing Ltd. Partnership v. City of Bloomer, 2002 WI App 252, 257 Wis. 2d 883, 653 N.W.2d 309, 01-3495. See also Northland Whitehall Apartments Ltd. Partnership v. City of Whitehall, 2006 WI App 60, 290 Wis. 2d 488, 713 N.W.2d 646, 04-2941.

70.32 Annotation An assessor cannot be free to choose between the mortgage subsidy rate and the mortgage market rate when using the income approach to valuing federally subsidized housing. If the use of a market rate was proper in City of Bloomer, 2002 WI App 252, the use of a subsidized interest rate cannot be. Mineral Point Valley Ltd. Partnership v. City of Mineral Point Board of Review, 2004 WI App 158, 275 Wis. 2d 784, 686 N.W.2d 697, 03-1857.

70.32 Annotation A property tax assessment of retail property leased at above-market rent values should be based on market rents and not on the above-market rental terms of the actual lease. Walgreen Co. v. City of Madison, 2008 WI 80, 311 Wis. 2d 158, 752 N.W.2d 687, 06-1859.

70.32 Annotation When an assessor only after looking at prevailing market conditions and all variables determined that the market for lakefront property had grown so strong that factors other than beach length and beach quality were being ignored by the marketplace, the approach was not formulaic and was not in violation of Campbell, 210 Wis. 2d 239 (1997). Anic v. Board of Review, 2008 WI App 71, 311 Wis. 2d 701, 751 N.W.2d 870, 07-0761.

70.32 Annotation An assessment based on a Department of Revenue analysis of the sale of a mining company that owned the land was not based upon a recent arm’s-length sale of the property. A value derived by analyzing a complex corporate transaction involving the sale of a variety of assets, tangible and intangible, independent and interdependent, is not equivalent to the price obtained in a sale of one component of that transaction. Forest County Potawatomi Community v. Township of Lincoln, 2008 WI App 156, 314 Wis. 2d 363, 761 N.W.2d 31, 07-2523.

70.32 Annotation The Property Assessment Manual and case law set forth a three-tier system for determining the fair market value of property. A recent arm’s-length sale of the property is the best evidence of value and is the basis for an assessment under tier one. If there has been no recent sale, an assessor must consider sales of reasonably comparable properties, which is the tier two approach. In the absence of comparable sales data, the assessor determines the value under tier three, which permits consideration of all the factors collectively that have a bearing on value of the property in order to determine its fair market value. Nestle USA, Inc. v. DOR, 2009 WI App 159, 322 Wis. 2d 156, 776 N.W.2d 589, 08-0322.

70.32 Annotation Affirmed. 2011 WI 4, 331 Wis. 2d 256, 795 N.W.2d 46, 08-0322.

70.32 Annotation Absent sufficient proof that no market existed for a property having a specialized use, an assessment under the tier two comparable sales approach based on an expanded definition of highest and best use to include a use for which a market exists would be contrary to sub. (1). The taxpayer has the burden of proving the absence of a market for the property with its current specialized use. That there were no known sales of properties put to that special use merely suggests that such properties are rarely bought and sold. It does not necessarily indicate that the taxpayer would be unable to find a buyer who intended to maintain the property as its current use. Nestle USA, Inc. v. DOR, 2009 WI App 159, 322 Wis. 2d 156, 776 N.W.2d 589, 08-0322.

70.32 Annotation Affirmed. 2011 WI 4, 331 Wis. 2d 256, 795 N.W.2d 46, 08-0322.

70.32 Annotation When there are no sales of the property itself or of reasonably comparable properties, an assessment cannot be made under a tier one or tier two methodology. The assessment is then made using a tier three methodology. The cost of replacement approach is the preferred tier three method of valuation when, as here, the property has a highly specialized use resulting in there being no comparable properties. Nestle USA, Inc. v. DOR, 2009 WI App 159, 322 Wis. 2d 156, 776 N.W.2d 589, 08-0322.

70.32 Annotation Affirmed. 2011 WI 4, 331 Wis. 2d 256, 795 N.W.2d 46, 08-0322.

70.32 Annotation In situations when it has been determined that there is no potential market for the subject property, it is contrary to sub. (1) to conclude that the highest and best use of the property should remain the same. That was not the case when there was at least a limited market for powdered infant formula production facilities. Nestle USA, Inc. v. DOR, 2011 WI 4, 331 Wis. 2d 256, 795 N.W.2d 46, 08-0322.

70.32 Annotation Reassessing one property at a significantly higher rate than comparable properties using a different methodology and then declining to reassess the comparable properties by that methodology violates the uniformity clause. U.S. Oil Co. v. City of Milwaukee, 2011 WI App 4, 331 Wis. 2d 407, 794 N.W.2d 904, 09-2260.

70.32 Annotation Comparing a taxpayer’s appraised value to lower values assigned to a relatively small number of other properties has long been rejected as a claimed violation of the uniformity clause. Lack of uniformity must be established by showing a general undervaluation of properties within a district when the subject property has been assessed at full market value. Great Lakes Quick Lube, LP v. City of Milwaukee, 2011 WI App 7, 331 Wis. 2d 137, 794 N.W.2d 510, 09-2775.

70.32 Annotation A property’s assessed value is based on fair market value, but a property’s assessed value is not necessarily equal to its fair market value. Assessors must base assessments of real property on the property’s fair market value. However, as the plain language of the Property Assessment Manual makes clear, a property’s fair market value is not synonymous with its assessed value. In most cases, individual property assessments are different than the property’s fair market value. State ex rel. Stupar River LLC v. Town of Linwood Board of Review, 2011 WI 82, 336 Wis. 2d 562, 800 N.W.2d 468, 09-0191.

70.32 Annotation The taxpayer challenging an assessment and classification has the burden of proving at the board hearing that the assessment and classification of property are erroneous; that the taxpayer did not meet the burden of proof; and that the board’s determination to maintain the assessment is supported by a reasonable view of the evidence. Sausen v. Town of Black Creek Board of Review, 2014 WI 9, 352 Wis. 2d 576, 843 N.W.2d 39, 10-3015.

70.32 Annotation Except for sub. (2) (c) 3., every subdivision of sub. (2) (c) uses the verb “means” instead of “includes” when defining a property classification. “Means” clearly limits the classes of property defined in those subdivisions to the specific types of property described therein. If the legislature intended the residential class to be restricted to the type of property described in sub. (2) (c) 3., it would have used the verb “means” instead of “includes.” Aside from the property specifically described in sub. (2) (c) 3., any other property included in the residential class must fall within the ordinary meaning of the term “residential.” West Capitol, Inc. v. Village of Sister Bay, 2014 WI App 52, 354 Wis. 2d 130, 848 N.W.2d 875, 13-1458.

70.32 Annotation Nothing in s. 70.10 requires a property to be classified based on its actual use or prevents an assessor from considering a property’s most likely use. An owner’s subjective expression of intent is not dispositive of a property’s most likely use. The Property Assessment Manual directs assessors to consider whether the property owner’s actions are consistent with an intent for residential use, but that is only one of seven factors the manual directs assessors to consider. West Capitol, Inc. v. Village of Sister Bay, 2014 WI App 52, 354 Wis. 2d 130, 848 N.W.2d 875, 13-1458.

70.32 Annotation A property need not be zoned residential in order to be classified as residential for property tax purposes, as long as residential use is likely to be allowed. West Capitol, Inc. v. Village of Sister Bay, 2014 WI App 52, 354 Wis. 2d 130, 848 N.W.2d 875, 13-1458.

70.32 Annotation Under sub. (2) (c) 4., land is nonproductive when it is neither producing nor capable of productive use. Property that is capable of productive use is not nonproductive and not entitled to the 50-percent assessment reduction under sub. (4). West Capitol, Inc. v. Village of Sister Bay, 2014 WI App 52, 354 Wis. 2d 130, 848 N.W.2d 875, 13-1458.

70.32 Annotation An appraiser must not value federally regulated housing as if it were market-rate property. Doing so causes the assessor to pretend that the subject property is not hindered by federal restrictions. The restrictions and underlying agreements implicit in federally regulated housing will affect the property’s value. Regency West Apartments LLC v. City of Racine, 2016 WI 99, 372 Wis. 2d 282, 888 N.W.2d 611, 14-2947.

70.32 Annotation Because of the difficulty in appraising subsidized properties under other appraisal methods, the income approach may be the best determiner of value. The Property Assessment Manual does not preclude appraisers from relying solely on the income approach when valuing subsidized properties. Metropolitan Holding, 173 Wis. 2d 626 (1993), unambiguously requires assessors to use income and expenses for the subject property when valuing subsidized housing under the income approach. Regency West Apartments LLC v. City of Racine, 2016 WI 99, 372 Wis. 2d 282, 888 N.W.2d 611, 14-2947.

70.32 Annotation Sub. (1) requires assessors to value property based on “the best information that the assessor can practicably obtain.” In this case, projected expenses and income for the newly opened property were available to the assessor. When the assessor calculated the net operating income for an income-based valuation through mass appraisal techniques that were not particularized to the assessed property, the assessment did not comply with sub. (1) because it did not use the “best information” that was available. Regency West Apartments LLC v. City of Racine, 2016 WI 99, 372 Wis. 2d 282, 888 N.W.2d 611, 14-2947.

70.32 Annotation In addition to calculating a net operating income (NOI) for the subject property, an income-based valuation requires determining the applicable capitalization rate. The capitalization rate expresses the rate of return an investor would expect to receive from an investment in the subject property. The value of a subject property is determined by dividing its NOI by the applicable capitalization rate. Capitalization rates from the marketplace are usually derived from the sale of market-rate projects. Such capitalization rates do not reflect the unique characteristics of subsidized housing. Regency West Apartments LLC v. City of Racine, 2016 WI 99, 372 Wis. 2d 282, 888 N.W.2d 611, 14-2947.

70.32 Annotation If there are no reasonably comparable properties, the comparable sales approach cannot be used. The Property Assessment Manual explicitly states that when subsidized properties are reasonably comparable, properties being compared must have restrictions similar to the subject property. To determine if properties have similar restrictions, an appraiser must examine the specific restrictions that apply to each property, as well as the differences between these restrictions. Regency West Apartments LLC v. City of Racine, 2016 WI 99, 372 Wis. 2d 282, 888 N.W.2d 611, 14-2947.

70.32 Annotation Sub. (1) explicitly directs that property be assessed in the manner specified in the Property Assessment Manual “from actual view or from the best information that the assessor can practicably obtain.” The manual provides that commercial property can be valued by either single property or mass appraisal techniques. The manual makes clear that mass appraisal is accepted at the initial assessment stage and sets forth when a single property appraisal is necessary after the initial mass appraisal has been challenged by the taxpayer or if the property being valued is a special-purpose property that does not lend itself well to mass appraisal. The express language of the manual indicates that mass appraisal is a proper method of valuation in all other circumstances. Metropolitan Associates v. City of Milwaukee, 2018 WI 4, 379 Wis. 2d 141, 905 N.W.2d 784, 16-0021.

70.32 Annotation Under the inextricably intertwined test, the income-generating capability of the oil terminals was inextricably intertwined with the land and was thus transferable to future purchasers of the land. Therefore, that income was included in the land’s assessment because it appertained to the land. Marathon Petroleum Co. v. City of Milwaukee, 2018 WI App 22, 381 Wis. 2d 180, 912 N.W.2d 117, 16-0939.

70.32 Annotation The inextricably intertwined test applies to a tier two comparable sales approach for assessing real estate. Marathon Petroleum Co. v. City of Milwaukee, 2018 WI App 22, 381 Wis. 2d 180, 912 N.W.2d 117, 16-0939.

70.32 Annotation Classification of real property for tax purposes is based on the actual use of the property. Although an injunction, contract, or ordinance may be presented to argue how the property is supposed to be used, none can be the decisive factor for tax assessment purposes. Thoma v. Village of Slinger, 2018 WI 45, 381 Wis. 2d 311, 912 N.W.2d 56, 15-1970.

70.32 Annotation Using a property only for maintaining ground cover does not fall within the statutory definition of agricultural use. When the property owner adamantly denied any farming took place at all on the land and insisted that the property owner was maintaining ground cover only, the property owner failed to present any evidence that the use qualified as agricultural for tax assessment purposes. Thoma v. Village of Slinger, 2018 WI 45, 381 Wis. 2d 311, 912 N.W.2d 56, 15-1970.

70.32 Annotation A business purpose is not required in order for land to be classified as agricultural land for property tax purposes. The relevant statutes and rules refer to “growing” the relevant crops, not marketing, selling, or profiting from them. State ex rel. Peter Ogden Family Trust of 2008 v. Board of Review, 2019 WI 23, 385 Wis. 2d 676, 923 N.W.2d 837, 17-0516.

70.32 Annotation The income approach, which seeks to capture the amount of income a property will generate over its useful life, fits under the umbrella of tier three analysis. State ex rel. Collison v. City of Milwaukee Board of Review, 2021 WI 48, 397 Wis. 2d 246, 960 N.W.2d 1, 18-0669.

70.32 Annotation Sub. (1m) requires that an assessor consider the impairment of the value of property due to contamination. In this case, the assessor determined that, given the property’s location and taking into account the presence of contamination, the highest and best use in its current state was a parking lot. By utilizing the income approach to value the property according to its highest and best use as a parking lot, the assessor properly considered the impairment of the value of the property due to contamination in arriving at a valuation pursuant to sub. (1m). The property owner argued that, because the property was contaminated, the owner could not sell it, and that accordingly the assessed value should be zero dollars. However, the assessment recognized that the highest and best use of the property as a parking lot had value to the owner even if the cost to cure environmental problems exceeded the value of the property. State ex rel. Collison v. City of Milwaukee Board of Review, 2021 WI 48, 397 Wis. 2d 246, 960 N.W.2d 1, 18-0669.

70.32 Annotation Some agricultural use—even if it is the only “use” the land is put to—does not mean the land is “devoted primarily to agricultural use.” “Devoted primarily” is the key phrase here. Being “devoted” to something means to be given over to and committed to that thing, and “primarily” means chiefly or mainly. As a matter of plain English, an agricultural classification is only proper if the land is chiefly given over to agricultural use. State ex rel. Nudo Holdings, LLC v. Board of Review, 2022 WI 17, 401 Wis. 2d 27, 972 N.W.2d 544, 19-1618.

70.32 Annotation Future planned residential development is a permissible basis on which to rest a residential classification. State ex rel. Nudo Holdings, LLC v. Board of Review, 2022 WI 17, 401 Wis. 2d 27, 972 N.W.2d 544, 19-1618.

70.32 Annotation The Property Assessment Manual counsels against using dark properties as comparables to properties that are not similarly dark in the context of a tier two sales comparison analysis. The comparability of vacant properties to occupied properties exists along a continuum depending upon how long the property has been vacant as compared to the normal exposure time for a property of that type in the same geographic area. The manual urges assessors to use caution in utilizing such comparables, as the economics underlying a vacancy may be indicative of a meaningful difference in the circumstances of the properties. Lowe’s Home Centers, LLC v. City of Delavan, 2023 WI 8, 405 Wis. 2d 616, 985 N.W.2d 69, 19-1987.