It should not be taken literally. The only way to get a 100% accurate list of the requirements is to look at the code itself on github.
This categorically does not happen.
The best way i could explain it is it needs 60 or more observations with the community taxon at that level. An observation with only the observers ID lacks a community Taxon.
This is just another example of not so much a lack of transparency on iNaturalists part, but a lack of detailed specific offical information. You have to basically find it yourself.
https://github.com/inaturalist/iNaturalistAPI/blob/main/lib/vision_data_exporter.js
Chunk copied from there.
// Some rules/assumptions:
// Never use taxa/clades which are known to be globally extinct
// Never use taxa below species
// Never use taxa/clades with rank hybrid or genushybrid
// Never use inactive taxa
// Only consider observations whose observation_photos_count is greater than 0
// Never use leaf taxa whose observations_count is less than 50
// Never use observations that have unresolved flags
// Never use observations that fail quality metrics other than wild
// Never use photos that have unresolved flags
// Populating files:
// Test and Val must have observations whose community_taxon_id matches the clade
// Train can also use obs where just taxon_id matches the clade, as lower priority
// One photo per obs in test and val, train can use 5 per obs
// In train, start adding one photo per observation, and fill with additional 4 if thereās room
// If obs photos are used in any set, the obsā other photos cannot appear in other sets
// Ideally if obs in train, not represented in other sets. Not too bad if obs in val and test