Hart v. Department of Revenue , 3 Or. Tax 493 ( 1969 )

Edward H. Howell, Judge.

The plaintiffs’ application for a special farm use assessment under ORS 308.370(2) was denied by the Washington County Department of Revenue and Taxation. The tax commission also denied the application and plaintiffs appealed. The assessment date involved is January 1, 1968.

The property, consisting of 14.7 acres purchased in 1960, includes some stump pasture with some cedar and fir trees. The plaintiffs have constructed two sheds for storing hay, fences and gates, drilled a well and excavated a two-acre pond which they have stocked with fish.

Plaintiffs owned two horses when they purchased the property. Since then they have added several Shetland ponies until they have' ten at the present time. The plaintiffs purchased four head of cattle in 1961, raised some calves, lost some cattle from disease and have two head at the present.

The land is not irrigated and produces no hay or other crops. The plaintiffs have been spending approximately $200 for hay for the cattle and horses.

With the exception of some farm employment during summers in Iowa several years ago, the plaintiff Joseph Hart has had no previous farming experience.

ORS 308.370 states that in order for land to receive a special farm use assessment it must be used exclusively for farm use. Farm use is defined in ORS 215.203(2) (a) as the current employment of land for the purpose of obtaining a profit by (among other things) raising and selling livestock. Subsection 2(b) states that the land shall not be regarded as being used to obtain a profit if it has not produced a gross income of $500 per year for three of the five calendar years preceding the particular assessment day involved, which in this case is January 1, 1968.

The plaintiffs’ land is not entitled to a special farm use assessment for the primary reason that the land has not produced $500 of gross income for three of the five years preceding January 1, 1968. In 1963 plaintiffs had a gross income from the sale of cattle of $153.11, $534.12 in 1964 and $655 in 1965. The land produced no income in 1966 and 1967.

In addition to the lack of income the land is not a bona fide farm as contemplated by the farm use statutes, ORS 308.370, 308.345, 308.380 and the State Tax Commission Reg 308.380 (which lists various factors that assessors should consider in determining whether the use of the land constitutes a bona fide farming operation.) As the land is not cultivated, no crops harvested or fertilizing or farm practices followed (with the exception of spraying for noxious weeds) and no hay raised for the livestock, it is not a bona fide farming operation. The land is being used primarily for the pasturing of plaintiffs’ horses and Shetland ponies and is not being used for the purpose of “obtaining a profit in money” as required by ORS 215.203(2) (a).

The order of the tax commission is affirmed.