University of Vermont AAHS




Mowery v. County of Kanabec

Minn. Tax Ct. 10th Dist.

2005 WL 94824

Jan. 12, 2005


Summary of Opinion


Keeping and sale of horses is held to be an agricultural use.  Boarding and training are not agricultural uses as these activities do not produce agricultural products.


Text of Opinion



The Court, having heard and considered the evidence adduced at the hearing, and upon all of the files, records and proceedings herein, now makes the following:


1. Petitioners have sufficient interest in the property to maintain this petition; all statutory and jurisdictional requirements have been complied with, and the Court has jurisdiction over the subject matter of the action and the parties hereto.

2. Petitioners own 40 acres of real estate located at 1975 177th Avenue, Mora, Minnesota, described as: SE1/4 of NE 1/4 of Section 27, Township 039, Range 024 ("Subject Property").

3. Petitioners bought the Subject Property in late 1999. In 2000, they began building their house, a horse barn, and a shelter on approximately 5 acres of the Subject Property.

4. After the buildings were completed on the Subject Property, Petitioners began breeding and raising horses on it. They had 9 horses on the Subject Property in 2001. On the date of trial, there were only 8 horses on the Subject Property. Petitioners sell horses on the internet and through their trainer in Loretto, Minnesota. They have no employees located on the Subject Property.

5. On 30 acres of the 40-acre parcel, Petitioners grow hay and maintain a pasture for the horses. Above and beyond the hay used to feed their horses, Petitioners sold hay to third parties in the amount of $1,200 during each of the years 2002 and 2003. In addition, Petitioners earned $1,700 from the sale of a horse in 2003.

6. In 1999, the Subject Property was classified as agricultural. In 2000, the Kanabec County Assessor's Office classified it as residential/homestead for the January 2, 2001 assessment due in 2002.

7. On December 22, 1999, at the time Petitioners purchased the Subject Property, they checked the box for Residential and Single Family use on the Certificate of Real Estate Value ("CRV"). Although they intended at the time to both farm and live on the Subject Property, Petitioners filled out the CRV as they did because they thought it would be easier to obtain a home loan than an agricultural one.

8. The Subject Property is primarily used for agricultural purposes.


1. The classification of the Subject Property as of January 2, 2003, except for the house, garage and one acre surrounding it, shall be changed on the books and records of Kanabec County from residential to agricultural.

2. Real estate taxes due and payable in 2003 shall be recomputed accordingly and refunds, if any, paid to Petitioners as required by such computations, together with interest from the original date of payment.



The issue in this case is the appropriate classification of James and Janice Mowry's ("Petitioners") property in Kanabec County. Respondent Kanabec County ("the County") argues that the property should be classified residential, while Petitioners argue that it should be classified agricultural.


On April 30, 2004, Petitioners filed a Petition in Kanabec County District Court challenging the January 2, 2003 classification of their 40-acre parcel of land located in Mora, Minnesota, Property I.D. No. 02-02275-10. The property had been classified as residential before it was purchased by Petitioners. On their Certificate of Real Estate Value, Petitioners checked the box indicating they intended to use the Subject Property as Residential and Single Family. On August 16, 2002, Petitioner James Mowry ("Mr.Mowry") had a telephone conversation with Mark Larson ("Mr.Larson"), then of the Kanabec County Assessor's Office, in which he asked about the Subject Property qualifying for classification as agricultural. Mr. Mowry advised Mr. Larson that he raised horses and grew hay on the Subject Property. Mr. Larson explained to Mr. Lowry that the agricultural classification requires that an agricultural product be produced, and horses would only be considered livestock if they were being raised for another use such as animal food. He further indicated that otherwise, horses are considered more like pets. As for the hay production, Mr. Larson said that the Petitioners would need to produce a Schedule F from their Federal Income Tax Return or something similar verifying they were selling approximately the equivalent of 10 acres of hay to qualify the Subject Property as agricultural.

In April 2003, the County sent Petitioners the 2004 Payable Notice of Valuation and Classification which again classified the Subject Property as agricultural. On May 8, 2003, Petitioners appealed to the Local Board of Appeal and Equalization, which decided that the classification would be changed to agricultural upon receipt of a copy of Petitioners' Schedule F showing that they sold hay. On June 18, 2003, Petitioners appealed to the County Board of Equalization, which tabled the matter until Petitioners could produce a copy of their Schedule F. On June 25, 2003, Petitioners presented their Schedule F to Kanabec County Assessor Sue Kondratowicz ("Ms.Kondratowicz"), along with a letter from their certified public accountant stating that $1,200 in sales were due to the sale of hay and horses. At the County Board meeting that same day, the Board decided to leave the Subject Property classification as residential. The classification was reconsidered by the County Board on September 23, 2003, at which time the classification as residential was confirmed. That same date, Ms. Kondratowicz sent Petitioners a letter again advising them that raising horses does not constitute an agricultural pursuit for property tax purposes. Petitioners then brought this appeal, challenging the County's classification of the Subject Property.


The assessor's classification is presumed to be valid. Minn.Stat. 271.06, subd. 6. Petitioners bear the burden to show that a different classification should be applied to the subject property. In this case, Petitioners must prove that the business conducted on the Subject Property was primarily for agricultural purposes.

The Court's determination of classification is controlled by the property tax classification statute, Minn.Stat. 273.13. Minnesota Statute Section 273.13, subd. 23(c) reads in relevant part as follows:

Agricultural land ... means contiguous acreage of ten acres or more, used during the preceding year for agricultural purposes. "Agricultural purposes" as used in this section means the raising or cultivation of agricultural products....

Minn.Stat. 273.13, subd. 23(c).

"Agricultural products" include:

livestock, dairy animals, dairy products, poultry and poultry products, fur-bearing animals, horticultural and nursery stock ..., fruit of all kinds, vegetables, forage, grains, bees, and apiary products by the owner;

Minn.Stat. 273.13, subd. 23(e)(1).

In Ramberg v. County of Washington, File No. C5-90-2078 (Minn. Tax Ct. Feb. 5, 1991), we found that:

boarding horses that are held solely for breeding and/or resale is similar to raising other livestock ... Inherent in the term 'agricultural product' is the idea that the animal is being fed and kept for ultimate disposition and not for an interim use.

Id.; see also Schneider v. County of Dakota, File No. 95660 (Minn. Tax Ct. Feb. 9, 1984) ("Boarding and training horses, as compared to breeding, raising and selling horses, is not an agricultural pursuit because there is no agricultural product produced and sold.")

Similarly, we determined that where the petitioner bred and raised horses, as well as grew hay which she sold to others and used to feed her own horses, the property should be classified as agricultural in Cassman v. County of Kanabec, File No. C0-96-51 (Minn. Tax Ct. Oct. 1, 1996). See also Equine Hospital, Inc. v. County of Dakota, File No. C0-92-7559 (Minn. Tax Ct. Nov. 2, 1993) ("A review of prior cases decided by this Court and the legislative history of Minn.Stat. 273.13, subd. 23 leads us to conclude that the activity of 'raising' livestock must occur to qualify for agricultural classification. Raising horses may qualify for the agricultural classification....")

Here, the County interprets the statutory term "livestock" found in Minn.Stat. 273.13, subd. 23(c) to exclude horses. The County relies upon the definition of "livestock" found in Minn.Stat. 17A.03, subd. 5, which includes only those horses that are sold for slaughter. We disagree. Minnesota Statute Section 17A.03, subd. 1 expressly limits the scope of that definition" to Chapter 17A, the livestock market licensing laws. Further, we note that at least one other Minnesota statute defining "livestock" refers to horses as livestock without limiting the term to only those sold for slaughter. See, e.g., Minn.Stat. 31.59, subd. 3 (" 'Livestock' means cattle, horses, swine, sheep and goats."). Additionally, there is no case law authority before the Court to suggest that horses raised for breeding and/or resale do not fit within the definition of "livestock." In fact, the only case law cited by either party is to the contrary. In Ramberg v. County of Washington and Cassman v. County of Kanabec, we found that horses held solely for breeding and/or resale is similar to raising other livestock. In this case, there was undisputed testimony at trial that Petitioners raised, bred, and sold horses that were kept on the Subject Property and that Petitioners were engaged in the business of raising horses for breeding and/or resale both prior and subsequent to moving to the Subject Property.

Moreover, Petitioners grow almost 30 acres of hay to feed their own horses and to sell to third parties. The 2002 Schedule F showed $1,200 of hay sold, and the 2003 Schedule F showed a total of $3,018 for the sale of hay and a horse. $1,700 of this amount was for the sale of a horse, leaving $1,318 as the amount attributable to selling hay in 2003. Under Minn.Stat. 273.13, subd. 23(c), "[a]gricultural land ... means contiguous acreage of ten acres or more used during the preceding year for agricultural purposes." The County contends that since hay sold for $4.00 a bale, Petitioners sold only 300 bales of hay in 2002 and less than 400 bales in 2003. The County then calculates that the bales of hay sold indicate that only 3.5 acres of Petitioners' land was used to grow hay. While such mathematical calculations are based upon aerial photos and the assessor's opinions, we do not find them persuasive for two principal reasons. First, they do not take into account the amount of hay Petitioners used to feed their own horses. Second, we are convinced from the record that Petitioners used almost 30 acres of the Subject Property to grow hay for sale to others and for the horses they raised.

We, therefore, find Petitioners have satisfied their burden of proving that the Subject Property is properly classified agricultural.


For the foregoing reasons, we conclude that the Subject Property, excluding the house, garage, and surrounding one acre, should be classified agricultural under Minn.Stat. 273.13, subd. 23(c) because 10 acres or more contiguous acres are used for agricultural purposes, namely raising and breeding horses and growing hay.


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