Farmers Direct, Inc. v. Dept. of Rev.

388 	September 6, 2023 	No. 23
IN THE OREGON TAX COURT
REGULAR DIVISION
FARMERS DIRECT, INC.,
Plaintiff,
v.
DEPARTMENT OF REVENUE,
State of Oregon,
Defendant,
and
YAMHILL COUNTY ASSESSOR,
Defendant-Intervenor.
(TC 5328)
In its motion for summary judgment, Defendant argued that Plaintiff’s straw
compression system was ineligible for property tax exemption as “farm machinery
and equipment” under ORS 307.394(1)(a), (b), or (d). Bales of straw that are left
on the fields by a combine are removed from the fields and transported to a cov-
ered location, then taken to the compression system, which cuts and compresses
the bales to facilitate shipping overseas. The court determined that, under King
Estate Winery, Inc. v. Dept. of Rev., 329 Or 414, 988 P2d 369 (1999), the compres-
sion system is not “farm machinery and equipment” because it is used outside
the “natural progression” of activities listed in ORS 307.394(1)(a), which starts
with “preparation of land” and ends with “placing [crops] in storage.” Further,
the compression system is too far removed from the act of feeding animals to be
exempt under ORS 307.394(1)(b). Finally, the court concluded that the exemption
for an “other agricultural use” under ORS 307.394(1)(d) does not apply, because
under King Estate that exemption does not apply to property used outside the pro-
gression of activities listed in ORS 307.394(1)(a). The court granted Defendant’s
motion for summary judgment and denied exemption for the compression system.
Oral argument on Defendant’s motion for summary
judgment was held April 13, 2022, in the courtroom of the
Oregon Tax Court, Salem.
Connor J. Harrington, Kevin L. Mannix, PC, Salem, filed
the response and argued the cause for Plaintiff.
James C. Wallace, Senior Assistant Attorney General,
Department of Justice, Salem, filed the motion and argued
the cause for Defendant.
Decision for Defendant rendered September 6, 2023.
ROBERT T. MANICKE, Judge.

Cite as 25 OTR 388 (2023) 	389
This 	matter 	is 	before 	the 	court 	on 	Defendant
Department of Revenue’s (the department’s) motion for sum-
mary judgment. In a prior motion for summary judgment
dated filed March 5, 2019, the department asked the court
to determine that the subject property, a straw compression
system, was not “tangible personal property” and thus was
ineligible for exemption from property tax under any provi-
sion of ORS 307.394(1).1 The court denied the motion on the
ground that material facts were required to be resolved at
trial. See Farmer’s Direct, Inc. v. Dept. of Rev., 24 OTR 399,
438 (2021). In the instant motion, the department asks the
court to determine that the Compression System is ineligible
for exemption under ORS 307.394(1)(a), (b), or (d). Plaintiff
(Taxpayer) resists the motion. The tax years at issue are the
property tax years 2016-17 and 2017-18.
I. 	FACTS
The following facts are not disputed. Taxpayer is
an Oregon corporation in the business of compressing large
bales, consisting almost entirely of straw, into smaller
bales using a Steffen Systems Model 4600SP Big Bale
Compression System (Compression System). The straw is a
byproduct of grass seed farming and is left on the fields in
windrows when a combine cuts the standing grass and sep-
arates the grass seeds into a tank. The straw must be finely
mulched onto farm fields, or removed from farm fields, to
avoid suffocating the next year’s grass seed crop or to allow
for replanting.
Until about 1993, grass seed straw commonly was
piled and burned. Straw is not commonly used as an animal
feed in the United States. A market for straw exists in Asia,
where customers often mix the straw with other proteins,
sugars, and fibers for use as animal feed. However, it is not
cost-effective to ship the large, “single-pressed” bales that are
formed by mobile balers collecting the straw left on the fields
in windrows. Single-pressed bales are approximately three
feet by four feet, by seven to twelve feet in length. Single-
pressed bales are commonly moved to a covered location
shortly after baling in the field to avoid subjecting the baled
1 Unless otherwise indicated, all references to the Oregon Revised Statutes
(ORS) are to the 2015 edition.

390 	Farmers Direct, Inc. v. Dept. of Rev.
straw to rain. “Hay and straw is initially baled in the farm
fields, and then transported to barns plaintiff leases before
being compressed.” From there, the single-pressed bales are
taken to the Compression System, which is located in a barn
that Taxpayer leases near the fields farmed by Taxpayer’s
shareholders. The single-pressed bales are fed into the
Compression System, which cuts them in half, compresses
them lengthwise, and wraps them for shipment, resulting
in smaller bales that are about one-half as tall, around 80
percent shorter, and up to twice as dense, compared to sin-
gle-pressed bales.
Approximately 	one-half 	the 	straw 	that 	is 	dou-
ble-pressed is sourced from fields owned by Taxpayer’s share-
holders, and the other half is purchased from other farms.
The barn where the Compression System is located is on land
in Yamhill County that is zoned for exclusive farm use.
II. 	ISSUE
Is the Compression System exempt from property
tax under ORS 307.394(1)(a), (b), or (d)?
III. 	ANALYSIS
A. 	Relevant Statute: ORS 307.394(1)
The department seeks summary judgment that
the Compression System is ineligible for exemption under
paragraphs (a), (b), and (d) of ORS 307.394(1). Taxpayer does
not seek exemption for the Compression System under the
remaining paragraph, ORS 307.394(1)(c). The court reprints
ORS 307.394(1) in its entirety:
“(1) 	The following tangible personal property is exempt
from ad valorem property taxation:
“(a) 	Farm machinery and equipment used primarily
in the preparation of land, planting, raising, cultivat-
ing, irrigating, harvesting or placing in storage of farm
crops;
“(b) 	Farm machinery and equipment used primarily
for the purpose of feeding, breeding, management and
sale of, or the produce of, livestock, poultry, fur-bearing
animals or bees or for dairying and the sale of dairy
products;

Cite as 25 OTR 388 (2023) 	391
“(c) 	Machinery and equipment used primarily to imple-
ment a remediation plan as defined in ORS 308A.053
for the period of time for which the remediation plan is
certified; or
“(d) 	Farm machinery and equipment used primarily
in any other agricultural or horticultural use or animal
husbandry or any combination of these activities.”
B. 	Meaning of “Farm Machinery and Equipment” Under
King Estate
In King Estate Winery, Inc. v. Dept. of Rev., 329 Or
414, 988 P2d 369 (1999), the Oregon Supreme Court con-
strued the predecessor of paragraph (d) of ORS 307.394(1), as
well as the term “[f]arm machinery and equipment,” which
appears in both paragraphs (d) and (a). 2 Accordingly, this
court begins by examining the analysis in King Estate and,
to the extent applicable, applying that analysis to Taxpayer’s
claims for exemption under paragraphs (a) and (d).
In King Estate, the property at issue was tangible
personal property used to make and sell wine in the tax-
payer’s winery, consisting of (1) “ ‘equipment used to stem
and crush the grapes, filter the juice, and ferment and store
the wine’ ”; (2) furniture used in the dining room and guest
rooms; (3) computers and other recordkeeping equipment;
(4) rolling stock, including forklifts, and a generator; and (5)
materials and supplies. King Estate, 329 Or at 416 (quoting
14 OTR 169, 170-171 (1997)). The court held that the prop-
erty was not “farm machinery and equipment,” and that the
operation of a winery was not an “agricultural or horticul-
tural use.” See id. at 418-19, 421, 424.
The court first examined the text and context of
“farm,” within the phrase “farm machinery and equipment.”
The court stated:
“The plain, natural, and ordinary meaning of the word
‘farm’ is ‘a piece of land held under lease for cultivation’ or ‘a
plot of land devoted to the raising of domestic or other ani-
mals.’ Webster’s Third New Int’l Dictionary, 824 (unabridged
2 Except for recodification, the only difference between the 2015 text of ORS
307.394(1)(d) and the text of former ORS 307.400(3)(c) (1993) at issue in King
Estate is the insertion of “any combination of these activities” in lieu of the former
phrase “any combination thereof.” Or Laws 2001, ch 753, § 15.

392 	Farmers Direct, Inc. v. Dept. of Rev.
ed 1993). Based on the plain, natural, and ordinary mean-
ing of the word ‘farm,’ we infer generally that ‘farm machin-
ery and equipment’ means machinery and equipment used
to cultivate farm land or to raise animals.”
Id. at 419. Turning to context, the court looked to the prede-
cessor of paragraph (a) of ORS 307.394(1), the text of which is
unchanged. The court described that provision as expressing
a “natural progression” of activities in which farm machin-
ery and equipment is used for land or crop “cultivation,” as
opposed to the processing of crops or the sale of processed
crops. Id. at 419-20. The court examined other exemptions
that at that time were codified in the same statute, conclud-
ing that they, too, were limited to “to cultivating crops on
land or to raising animals on land, which is how a ‘farm’ ordi-
narily is defined.” Id. at 421; see ORS 307.325 (exempting live-
stock, poultry, fur-bearing animals and bees); ORS 307.391
(exempting radio equipment used in field burning manage-
ment); ORS 307.394(2) (exempting certain tools, machinery,
and equipment used in animal husbandry or agricultural or
horticultural activities); ORS 307.397 (exempting what was
previously contained in ORS 307.400(5) (1993)).
This court summarizes the court’s conclusions in King
Estate based on text and context as follows: “Farm machinery
and equipment” encompasses only machinery and equipment
used to “cultivate farm land” (Id. at 419), to “cultivat[e] crops
on land” (Id. at 421), or to “rais[e] animals on land” (Id.). In
King Estate, the court quickly decided that the winery prop-
erty was not used for two of those three uses: “cultivating
farm land or raising animals.” Id. at 419. The remaining use
(cultivating crops) is a “progression” that commences with the
“preparation of land” and ends with “placing in storage” of
crops. Id. at 419-20. The uses of the winery property—“to pro-
cess fruit and to sell the fruit product”—were outside the scope
of this progression. Id. at 423 (emphases in original).
C. 	Applying King Estate to Define “Farm Machinery and
Equipment”
1. 	Is the Compression System used to cultivate crops
on land?
This court now applies the three meanings of “farm
machinery and equipment” determined in King Estate,

Cite as 25 OTR 388 (2023) 	393
starting with machinery and equipment used to “cultivat[e]
crops on land.” Although a byproduct of grass seed farm-
ing, there is no question that grass seed straw is a “crop.”
See ORS 174.102 (“(1) The term ‘agricultural commodity’ or
‘agricultural product’ includes straw. (2) The harvesting or
baling of straw is a farming practice.”). Rather, the question
is whether “double-pressing” is part of the “natural progres-
sion” that starts with “preparation of land,” ends with the
“placing in storage” of the straw crop, and includes any of
the intermediary activities listed in ORS 308.394(1)(a).
As to “preparation of land,” the uncontested evi-
dence is that waste straw must be removed from the land
(or mulched) because it would suffocate the next year’s grass
seed crop if left on the land. The act of removing the waste
straw could, therefore, constitute preparation of the land.
However, the Compression System is not used to remove
the waste straw from the land; double-pressing occurs only
after the waste straw already has been removed. While dou-
ble-pressing likely makes removal more economically via-
ble, by enabling the straw to be sold abroad, double-pressing
does not occur on the land where a new crop will be grown;
therefore, the court concludes that the Compression System
is not “used * * * in the preparation of land.”
The court considers the other end of the progres-
sion: the “placing in storage of farm crops.” The court applies
the framework in State v. Gaines to construe this phrase,
which the legislature wrote in 1981. See 346 Or 160, 171-
72, 206 P3d 1042 (2009); Or Laws 1981, ch 374, § 1. At that
time, the plain meaning of “storage” was a place or space
for storing, or the act of storing. Webster’s Third New Int’l
Dictionary 2252 (unabridged ed 1976). “Storing,” in turn,
meant to “stock or furnish against a future time”; to “collect
as a reserved supply”; or to “leave or deposit in a store, ware-
house, or other place for keeping, preservation, or disposal.”3
3 The full definition of “storage” at the time was:
“1a : space for storing <[storage] available at low rates> <[storage] cabinet>
<[storage] room> b: a place for storing <area, which was being used as a
[storage] for war matériel — N. Y. Times> <granaries and other unheated
crop [storages] — Nat’l Fire Codes> <insulation requirements for fruit and
vegetable [storages] — P. D. Close> <the development of water [storages] in
arid regions> c: an amount stored esp. : the total amount (as of water in a res-
ervoir) that can be stored in a place <the dam … has a total [storage] of eight

394 	Farmers Direct, Inc. v. Dept. of Rev.
Id. The contemporaneous technical legal definition of the
verb “store” was “[t]o keep [goods, etc.] for safe custody, to
be delivered in the same condition as when received, where
the safe-keeping is the principal object of deposit, and not
the consumption or sale.” Black’s Law Dictionary 1273 (5th
ed 1979). Both the plain meaning and the technical legal
meaning contemplate that the period of storage will end at
some future time, but neither definition indicates any par-
ticular duration. In this case, two statements in the factual
record indicate that storage of the straw occurs before the
Compression System is used. First, the parties have stip-
ulated that “[h]ay and straw is initially baled in the farm
fields, and then transported to barns plaintiff leases before
being compressed.” Second, a witness for Taxpayer testified
that “[b]aled straw and hay are commonly moved to a cov-
ered location shortly after baling in the field to avoid subject-
ing the baled straw and hay to rain.” The court interprets
billion cubic feet of water — Amer. Guide Series: Maine> 2a: the act of storing
or state of being stored <off-street [storage] of automobiles> <underground
[storage] of natural gas> <lake, created primarily for upstream [storage] —
Amer. Guide Series: Nev.> <meat packaged for [storage]> specif : the safekeep-
ing of goods in a warehouse or other depository <place goods in [storage]> —
compare cold storage b: the price charged for keeping goods in a storehouse
<to charge [storage]> c: the holding and housing of goods from the time they
are produced until their sale 3: the production by means of electric energy of
chemical reactions that when allowed to reverse themselves generate elec-
tricity again without serious loss — see storage cell 4: memory 6”
Webster’s Third New Int’l Dictionary 2252 (unabridged ed 1976).
The full definition of “store” at the time was:
“1: furnish , provide , supply, fill <bins [stored] with grain> <his head was
[stored] with chaotic but vivid impressions — Frances Gaither> esp. : to stock
or furnish against a future time <[store] a ship with provisions> 2: to collect
as a reserved supply : lay away : accumulate <[store] vegetables for winter
use> <energy from the sun may be [stored] in the form of fat as well as car-
bohydrates … and proteins — R. E. Coker> <energy [stored] in a condenser
can be computed — W. H. Timbie & Vannevar Bush> —often used with up or
away <build dams to [store] up water — R. W. Murray> <memories [stored]
away> 3a: to leave or deposit in a store, warehouse, or other place for keep-
ing, preservation, or disposal : cache , stow <potatoes [stored] in a basement>
<in the early days of the passenger car it was almost unheard of to [store]
it on the street — J. C. Ingraham> <the center mall is often used to [store]
snow plowed from the pavement in winter months — A. G. Bruce & John
Clarkeson> <honey [stored] in hives> b: to record (information) in an elec-
tronic device (as a computer) from which the data can be obtained as needed
4: to have space for : provide storage room for : hold <elevators to [store]
surplus wheat>”
Id. (emphasis in original).

Cite as 25 OTR 388 (2023) 	395
“baling in the field” to mean the initial baling, not the dou-
ble-pressing for which the Compression System is used. The
court finds that this movement of the baled straw to a barn
or other covered location constitutes “placing in storage” of
the straw. Double-pressing occurs only after any such place-
ment in storage. Therefore, the court concludes that the
Compression System is not “used * * * in the * * * placing in
storage of farm crops.”
The court next considers whether double-press-
ing might still be used to “cultivat[e] crops on land” by
fitting within any of the intermediate activities listed in
ORS 307.394(1)(a): “planting, raising, cultivating, irrigat-
ing, [or] harvesting * * *.” The court finds no basis to treat
the Compression System as used in “planting,” “raising,”
or “irrigating” crops, nor does Taxpayer argue that the
Compression System performs any one of those activities in
isolation.4 The plain meaning of “cultivating,” in reference to
crops and as of 1973, was broad: to “protect and encourage
the growth of” and to “till or labor over.”5 Webster’s Third New
Int’l Dictionary 552 (unabridged ed 1971). “[P]rotecting” and
“labor[ing] over” a crop could encompass activities occurring
after a crop has been placed in storage. However, by referring
to a “natural progression,” the court in King Estate clearly
interpreted “cultivating” in the narrower sense conveyed by
the phrase “encourage * * * growth,” which refers to actions
taken with respect to living plants. The court concludes that
4 The court discusses below taxpayer’s argument that double-pressing is an
“integral and necessary part” of the activities listed in ORS 307.394(1)(a).
5 The full definition of “cultivate” at the time was:
“1: to prepare for the raising of crops : prepare and use for such a purpose :
till <[cultivate] the soil> specif : to loosen or break up the soil about (grow-
ing crops or plants) for the purpose of killing weeds and modifying moisture
retention of the soil esp. with a cultivator 2: to protect and encourage the
growth of: a: to till or labor over esp : to apply methods of culturing to <[cul-
tivate] oysters> <[cultivate] yeasts> b: to improve by labor, care, or study :
bring to culture, civilization, or refinement <writers who [cultivate] style> 3:
to cause to grow by special attention or by studying, advancing, developing,
practicing, or publicizing : further , encourage <Italy, where law and medi-
cine were cultivated, and the North, where theology with logic and metaphys-
ics were supreme — H. O. Taylor> 4: to seek the society of : make friends with
<outraged constantly by the odd assortment of people my father cultivated
— Elsa Maxwell>”
Webster’s Third New Int’l Dictionary 552 (unabridged ed 1971) (emphasis in
original).

396 	Farmers Direct, Inc. v. Dept. of Rev.
the Compression System is not used for planting, raising,
cultivating, or irrigating the straw crop.
The plain meaning of “harvesting,” in reference to
a crop or natural product, was to “gather” or “gather in.” 6
Webster’s Third New Int’l Dictionary 1036 (unabridged ed
1971). The plain meaning is consistent with this court’s prec-
edent, which has interpreted “harvesting” as severing fruit
or other crops, collecting them, and removing them from the
location where they grew. In Lakeview Farms, Ltd. v. Dept.
of Rev., 21 OTR 161 (2013), this court analyzed whether
wheelbarrows, as well as boats and trains and traffic safety
equipment, used at the taxpayer’s “pumpkin patch” were
used in “harvesting” within the meaning of ORS 307.394(1)
(a). The pumpkin patch was a fixed, 14-acre plot where the
taxpayer displayed pumpkins that customers could select
and bring to the cash register by means of a wheelbarrow,
or by riding a boat across a reservoir on the plot, or by rid-
ing a small, minimum-gauge train built by the man who
owned the taxpayer company. Some of the pumpkins were
grown on other parts of the taxpayer’s farm, or occasion-
ally on farms belonging to others, because the same plot of
land could not be used to grow pumpkins year after year.
See id. at 163. The court concluded that the pumpkins were
“harvested” when they were picked at, and removed from,
the location where they grew. To the extent that pumpkins
were grown outside the 14-acre pumpkin patch, they were
not “harvested” when customers carried or hauled them to
the cash register. Rather, the pumpkin patch functioned as
a “storage” area for those pumpkins while awaiting sale. Id.
at 169. The court denied the exemption for failure of proof.7
Applying that analysis, in this case the court cannot conclude
6 The full definition of the verb “harvest” at the time was
“1a: to gather in (a crop) : reap <when all the beets are [harvested] a steam
shovel loads them on trucks — Amer. Guide Series: Minn.> b: to gather (a
natural product) as if by harvesting <[harvest] honey> <[harvest] timber>
<[harvest] whales> 2a: to accumulate a store of <[harvest] news leads and
witticisms — Bennett Cerf> b: to win as a result of achievements <[har-
vested] rewards in fame and wealth … simply undreamed of — N. Y. Herald
Tribune>”
Webster’s Third New Int’l Dictionary 1036 (unabridged ed 1971).
7 The taxpayer could not provide a breakdown of pumpkins harvested on the
pumpkin patch vs. elsewhere. See id. at 169.

Cite as 25 OTR 388 (2023) 	397
that the Compression System is used in “harvesting” the
straw because by the time the straw is double-pressed, it has
already been cut, removed from the field, and stored.
Overall, the court concludes that the Compression
System is not used to “cultivat[e] crops on land” because it is
used only after the “natural progression of crop cultivation”
set forth in ORS 307.394(1)(a) has occurred, and it is not
used in any of the specific activities listed in ORS 307.394(1)
(a). The court will turn to the two remaining uses that define
“farm machinery and equipment”: “cultivat[ing] farm land”
and “rais[ing] animals.”
2. 	Is the Compression System used to cultivate farm
land?
The court in King Estate did not elaborate on any
distinction between cultivating farm land and cultivat-
ing crops. The court may have found any such discussion
unnecessary because the processing and marketing activ-
ities involved in operating the winery did not require any
interaction with the land where the grapes were grown
and, in fact, did not need to occur on farm land at all. The
taxpayer in King Estate processed grapes from vineyards
that were “adjacent” to the winery and controlled and man-
aged by the same individuals, as well as grapes from other,
“surrounding” vineyards. See 329 Or at 416. Similarly, the
facts in this case show no necessary connection between the
activities of the Compression System and farm land; the
only evidence is that the leased barn where the Compression
System is located is “near” the land farmed by Taxpayer’s
shareholders. And like the compression activity in this case,
the winery activities apparently occurred on land zoned and
classified for farm use under zoning laws and for property
tax purposes and were permitted activities under those pro-
visions, but those facts did not persuade the court that the
winery activities amounted to “cultivat[ing] farm land.” See
id.; see also King Estate Winery, Inc. v. Dept. of Rev., 14 OTR
169, 171 (1997) (noting relationship between “farm use” for
special assessment purposes and for land use purposes),
aff’d, 329 Or 414. The court concludes that the Compression
System is not used to cultivate land.

398 	Farmers Direct, Inc. v. Dept. of Rev.
3. 	Is the Compression System used to raise animals on
land?
Finally, the court in King Estate implied that
“rais[ing] animals” involves the “feeding” of animals, as
well as their “breeding” and “management,” but not the
“sale” of the “produce” of animals. Id. at 420 (citing ORS
307.394(1)(b)). 8 The court in this case sees no basis to treat
the Compression System as used in the “breeding” or “man-
agement” of animals, nor does taxpayer make any argu-
ment as to those terms. As for “feeding,” the plain mean-
ing in 1977 was “the act or process of one that feeds or the
act or process of being fed . . . an instance of feeding esp.
something more or less incapable of providing its own food
or of feeding itself.” Webster’s Third New Int’l Dictionary 834
(unabridged ed 1976). 9 The relevant definitions of the verb
“feed” were: “to give food to : supply with nourishment : sat-
isfy the hunger of * * * to convey food to the mouth of * * * to
furnish especially with something that is essential or that
improves or enhances * * * to produce [or provide] food for
* * * to give as food * * * to furnish for use or consumption.”10
Webster’s Third New Int’l Dictionary 833-34 (unabridged ed
8 It is unclear to this court, but also not relevant to this case, whether King
Estate implies that the “sale of” animals is part of the “raising” of animals. See
id.; ORS 307.394(1)(b) (exempting farm machinery and equipment used primar-
ily for the purpose of “sale of, or the produce of,” certain animals).
9 The full definition of the word “feeding” at the time was:
“1a: the act or process of one that feeds or the act or process of being fed<all
fruit purchased will be used to assist in relief [feeding] in foreign countries
— Collier’s Year Book><the jamming of the mechanism stopped the [feeding]
of the coke into the furnace> b: an instance of feeding esp. of fertilizer><gave
the baby eight ounces of milk at each [feeding]> 2: land used for grazing.”
Webster’s Third New Int’l Dictionary 834 (unabridged ed 1976).
10 The full relevant definitions of “feed” at the time were:
“1a: to give food to : supply with nourishment : satisfy the hunger of <[feed]
several guests> <[feed] the chickens> also : suckle <[feed] a baby at the
breast> b: to convey food to the mouth of <a patient so weak he had to be fed>
<[feed]ing a small child in a high chair>3a: to produce food for <the pasture
fed the cows poorly> b: to provide food for <enough wheat to [feed] the troops
for a week>6a: to give as food <[feed] grain to chickens> b : to furnish for use
or consumption <[feed]ing coal to a furnace> often in appropriate or conve-
nient amounts <hurried to another hospital to borrow a machine which he
hoped would [feed] the oxygen mechanically — Grace Reiten>—often used
with out <the flatbed press [fed] out papers each afternoon about as fast as I
could deal cards — C. C. Wertenbaker>”
Webster’s Third New Int’l Dictionary 833-34 (unabridged ed 1976).

Cite as 25 OTR 388 (2023) 	399
1976). The relevant legal definition of the verb “feed” was:
“[I]n its ordinary sense with reference to cattle and hogs
which are said to be made marketable by feeding.” Black’s
Law Dictionary 742 (4th ed 1968).11 The court concludes that
the plain meaning includes numerous variations on the
physical act of putting food into the mouth of an animal,
as well as more attenuated acts that result in satisfying an
animal’s hunger. The legal definitions are consistent with
the plain meaning but include additional indirect or figura-
tive senses. To determine the range of these meanings, the
court returns to King Estate. There, the court considered
the list of exempt properties now codified in ORS 307.397
and ORS 307.398, including frost control systems; trellises;
hop harvesting equipment; equipment to prepare, package
and ship fresh eggs; and field burning smoke management
equipment. 329 Or at 421. The court stated:
“All the aforementioned exemptions in ORS 307.400 per-
tain to cultivating crops on land or to raising animals on
land, which is how a ‘farm’ ordinarily is defined. Thus,
between the plain meaning of the word farm and the con-
textual implications of ORS 307.400, we find no legislative
intent to include machinery and equipment used in fruit
processing and fruit-product selling as part of the definition
of ‘farm machinery and equipment.’ ”
Id. (emphases added). This court interprets the contex-
tual analysis in King Estate as generally excluding activi-
ties that are not required to occur on the same land where
crops are grown or animals are raised. Applying the same
approach in this case, this court interprets “feeding”—as a
component of “raising”—to exclude those definitional senses
that are substantially separated by steps or by distance
from the physical act of putting food into the mouth of an
11 The full definition read:
“To lend additional support; to strengthen ex post facto. ‘The interests when it
accrues feeds the estoppel.’ Christmas v. Oliver, 5 Mood. & R. 202. Similarly,
a subsequent title acquired by the mortgagor is said ‘to feed the mortgage.’
The word is used in its ordinary sense with reference to cattle and hogs which
are said to be made marketable by feeding. Brockway v. Rowley, 66 Ill. 102.
It is also used in the phrase ‘feeding of a cow by and on the land’ to signify
from the land while there is food on it, and with hay by the owner of the land
at other times; 2 Q.B.Div. 49.”
Black’s Law Dictionary 742 (4th ed 1968).

400 	Farmers Direct, Inc. v. Dept. of Rev.
animal. The Compression System is substantially separated
by both steps and distance: before an animal can be “fed”
by the activity of double-pressing a bale, the compressed
bale must be loaded onto a ship, sent overseas, infused with
other nutrients, and transported to an end user, potentially
by means of middlemen. The court must conclude that the
Compression System is not used for “feeding” animals, and
it therefore is not used to “raise” animals.12
4. 	Conclusion: The Compression System is not “farm
machinery and equipment”
Based on the foregoing analysis under King Estate,
the Compression System is not “farm machinery and equip-
ment.” This conclusion alone requires the court to deny
exemption under each of the three paragraphs of ORS
307.394(1) on which Taxpayer bases its claim: paragraphs
(a), (b), and (d).
D. 	Other Arguments
Notwithstanding the court’s conclusion, the court
comments briefly on the parties’ arguments regarding
whether the Compression System is used in “any other agri-
cultural * * * use” under ORS 307.394(1)(d). Taxpayer argues
that the addition of this term, now in paragraph (d), broad-
ened the scope of the exemption otherwise available under
paragraph (a). See Or Laws 1977, ch 819, § 1 (HB 2847). The
court in King Estate implicitly rejected that argument. The
court noted that the plain meaning of “agriculture” included
“ ‘the science or art of the production of plants and ani-
mals useful to man and in varying degrees the preparation
of these products for man’s use and their disposal.’ ” 329 Or
at 423 (emphasis added) (quoting Webster’s Third New Int’l
Dictionary 44 (unabridged ed 1993). Nevertheless, the court
concluded that “the dictionary definition of ‘agriculture’ is
consistent both with the plain definition of a ‘farm’ and with
the contextual meaning of a ‘farm’ * * *.” 329 Or at 423-24.
This court observes that the legislative history of
the bill that added the reference to “any other agricultural
12 For the same reasons discussed above, the court rejects Taxpayer’s argu-
ment that the Compression System is used for “feeding” and thus is eligible for
exemption under ORS 307.394(1)(b) as a standalone provision.

Cite as 25 OTR 388 (2023) 	401
* * * use” repeatedly describes the new provision as “broad-
ening” the scope of the exemption. See, e.g., Measure
Analysis Statement, House Committee on Revenue and
School Finance, HB 2847, Jun 27, 1977 (describing the func-
tion and purpose of measure as “[b]roaden[ing] the defini-
tion of inventory” related to farm machinery and equip-
ment); Tape Recording, House Committee on Agriculture
and Natural Resources, HB 2847, Apr 26, 1977, Tape 35,
Side 1, 24:45 (describing amendments as “broaden[ing] what
falls under the inventory phase out”); House Revenue and
School Finance Committee, HB 2847, May 25, 1977, Tape
28, Side 2, 2:15:45-2:16:30 (describing the types of machin-
ery and equipment that would be exempt). However, given
the court’s interpretation in King Estate, this court consid-
ers “broadening” to mean that the legislature, at most, may
have intended to make the list of activities within the “natu-
ral progression” in paragraph (a) non-exclusive, encompass-
ing intermediate steps not expressly named in that para-
graph, without extending the range of activities beyond the
final step of “placing [crops] in storage.” Accordingly, tax-
payer’s position that double-pressing is an “integral part”
of the activities listed in paragraph (a) falls short. Because
double-pressing occurs after placement in storage, it is not
relevant, under King Estate, that double-pressing may make
it more likely that the straw may be planted and harvested
at all.
Relatedly, it is not necessary to revisit whether
the more expansive definitions of “farm use” for land use
purposes and for purposes of the farm use special assess-
ment laws are relevant to the meaning of “farm machinery
and equipment,” “any other agricultural use,” or any of the
other terms in ORS 307.394(1). See ORS 308A.056 (defining
“farm use” for purposes of special assessment of land); ORS
215.203(2)(a) (1977) (“farm use” includes current employment
of land for “any other agricultural or horticultural use”);
King Estate, 329 Or at 422 (discussing cross-references in
special assessment statutes to land use statutes). Taxpayer
argues forcefully that it defies common sense that a com-
pression system should be ineligible for exemption under
ORS 307.394(1), while the land on which a compression sys-
tem sits clearly is eligible for the intentionally lower taxable

402 	Farmers Direct, Inc. v. Dept. of Rev.
value available under the farm use special assessment
statutes. That is a policy argument that must be made in a
different forum. See Comcast Corp. v. Dept. of Rev., 363 Or
573, 550 (2018) (“Taxpayer’s criticism of [statutory] result
as ‘absurd’ provides no basis for [a court’s] disregarding the
legislature’s policy choice.”).
Finally, the court’s conclusion makes it unnecessary
to consider whether double-pressing is “processing,” as dis-
cussed at numerous points in the parties’ briefing. Although
King Estate uses that term to describe the activities of the
winery in that case (329 Or at 419), an activity need not
constitute “processing” to be excluded from the definition of
“farm machinery and equipment”; the activity need only be
outside the “natural progression” of activities commencing
with “preparation of land” and ending with “placing in stor-
age” under ORS 307.394(1)(a).
IV. 	CONCLUSION
The court concludes that the Compression System
is ineligible for exemption under ORS 307.394(1)(a), (b), and
(d) because it is not “farm machinery and equipment” as
that term is construed in King Estate. Now, therefore,
IT 	IS 	ORDERED 	that 	Defendant’s 	Motion 	for
Summary Judgment – ORS 307.394(1)(a) and (d) is granted.