In three August rulings, the Indiana Board of Tax Review found that an Indiana Assessor missed the mark (or hit the gutters) in arguing that evidence regarding uniform assessments for classes of property supported the individual assessments for a bowling alley and two banks. In each case, the properties’ 2006 assessments had increased by more than 5% over their 2005 values, which shifted the burden of proof to the assessors under Ind. Code § 6-1.1-15-17.2. Failing to submit probative evidence of value, the Assessor lost and the properties’ values were reduced to their 2005 levels.
In Chickamauga Properties v. Jackson County Assessor, Pet. No. 36-009-06-1-4-00014 (Aug. 19, 2013), a bowling alley’s assessed value increased 55% from 2005 to 2006. The Assessor testified as to how mass appraisal and annual trending is supposed to work. She “implied that the assessment draws validity from the fact that the assessed value is within an acceptable range for mass appraisals as determined by the sales ratio study.” (Page 4, ¶ 11(c).) But the appeal of a property’s assessment is an “entirely different thing.” Id. The Assessor’s “unsubstantiated conclusions” failed to support her assessment. The bowling alley’s assessment was reduced to its 2005 value.
The Indiana Board found the Assessor’s similar contentions to be without merit in her defense of a bank’s 2006 assessment. In Fidelity Federal Savings & Loan v. Jackson County Assessor, Pet. Nos. 36-009-06-1-4-00009 and -00017 (Aug. 21, 2013), the assessment of the bank (located on two parcels) increased by 36% over its 2005 value. The Assessor argued that the “properties were assessed using the same trending factor as the other properties in the [Owner’s] neighborhood,” although the Assessor couldn’t identify the factor because it was “not stored in a place that is retrievable from the computer system.” (Pages 2, 4, ¶¶ 9(c), 13(c).) But such testimony, the Board noted, “is not helpful in determining the actual market value-in-use” of the bank. (Page 4, ¶ 13(c).) Even if the ratio study showed that an adjustment was required for properties in the bank’s neighborhood, “this fact does not prove the true tax value of the two parcels under appeal.” (Page 4, ¶ 13(d).) The Assessor could not explain her assessment, so the bank’s value was reduced to its 2005 level. (Page 5, ¶ 13(e).)
The Assessor made the same argument – with the same result – in Irwin Union Bank & Trust v. Jackson County Assessor, Pet. No. 36-009-06-1-4-00013 (Aug. 26, 2013). The Board explained: “The Assessor offered no support for the notion that a ratio study can be used to prove an individual property’s assessment reflects its market value-in-use.” (Page 4, ¶ 13(d).) The Board further noted that the International Association of Assessing Officials (IAAO) in its Standard on Ratio Studies states that “ratio study statistics cannot be used to judge the level of appraisal of an individual property.” (Page 4, ¶ 13(d).) The Assessor didn’t “support the accuracy of the existing assessment with any meaningful market value-in-use evidence.” (Page 5, ¶ 11(f).) The bank’s 2006 assessment was therefore lowered to its 2005 value.