ATTORNEYS FOR PETITIONER: ATTORNEYS FOR RESPONDENT:
STEPHEN E. DEVOE STEVE CARTER
B. KEITH SHAKE ATTORNEY GENERAL OF INDIANA
HENDERSON DAILY WITHROW Indianapolis, IN
Indianapolis, IN TED J. HOLADAY
DEPUTY ATTORNEY GENERAL
INDIANA TAX COURT
INDIANAPOLIS RACQUET CLUB, INC., )
v. ) Cause No. 49T10-0206-TA-61
WASHINGTON TOWNSHIP )
(MARION COUNTY ) ASSESSOR, )
ON APPEAL FROM A FINAL DETERMINATION OF
THE INDIANA BOARD OF TAX REVIEW
February 6, 2004
The Petitioner, Indianapolis Racquet Club, Inc. (IRC), appeals from a final determination of
the Indiana Board of Tax Review (Indiana Board) valuing its real property for
the 1995 assessment year. The sole issue for the Courts review is
whether the Indiana Board erred in valuing IRCs land.
FACTS AND PROCEDURAL HISTORY
IRC owns and operates a commercial tennis club in Washington Township, Marion County,
Indiana. IRCs facility is located between 79th Street and 82nd Street, on
Dean Road, in Indianapolis.
In accordance with Indiana Code § 6-1.1-4-13.6 (1993), the Marion County Land Valuation
Commission and the State Board of Tax Commissioners (State Board) promulgated a land
order for use by Marion County assessing officials for the 1995 general reassessment.
Under that land order, the Washington Township Assessor valued IRCs primary land
at $4.80 per square foot and its secondary land at $3.36 per square
Believing these values to be too high, IRC filed an appeal with the
Marion County Board of Review (BOR). IRC received no relief at the
county level. Consequently, IRC filed an appeal with the State Board.
The State Board held a hearing on IRCs appeal on August 16, 2001.
On April 17, 2002, the Indiana BoardSee footnote issued a final determination in
which it made no change to IRCs land values.
IRC filed an original tax appeal on June 3, 2002. The Court
heard the parties oral arguments on October 27, 2003. Additional facts will
be supplied as necessary.
STANDARD OF REVIEW
This Court gives great deference to final determinations of the Indiana Board.
Wittenberg Lutheran Vill. Endowment Corp. v. Lake County Prop. Tax Assessment Bd. of
Appeals, 782 N.E.2d 483, 486 (Ind. Tax Ct. 2003), review denied. Consequently,
the Court may reverse a final determination of the Indiana Board only if
(1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;
contrary to constitutional right, power, privilege, or immunity;
(3) in excess of statutory jurisdiction, authority, or limitations, or short of statutory jurisdiction,
authority, or limitations;
(4) without observance of procedure required by law; or
(5) unsupported by substantial or reliable evidence.
Ind. Code § 33-3-5-14.8(e)(1)-(5) (West Supp. 2003). The party seeking to overturn
the Indiana Boards final determination bears the burden of proving its invalidity.
Osolo Township Assessor v. Elkhart Maple Lane Assocs., L.P., 789 N.E.2d 109, 111
(Ind. Tax Ct. 2003).
In 1995, land values were determined through the application of land orders.
Ind. Admin. Code tit. 50, rr. 2.2-4-2, -6 (1996). The land orders
were developed by collecting and analyzing comparable sales data for given areas.
See Ind. Code § 6-1.1-31-6(a) (West 2000) (amended 2002). See also State
Bd. of Tax Commrs v. Indianapolis Racquet Club, Inc., 743 N.E.2d 247, 251
(Ind. 2001). More specifically, each county had a land valuation commission that
collected and analyzed sales data on non-agricultural (i.e., residential, commercial, and industrial) land
within the county and, on the basis of that data, recommended a range
of values for property in certain areas. See Ind. Admin. Code tit.
50, r. 2.2-4-5 (1996). These values were either accepted or modified by
the State Board, without further input from the county commissions. See Ind.
Code § 6-1.1-4-13.6 (West 1989) (amended 1993); Ind. Admin. Code tit. 50, r.
2.2-4-3(a) (1996). The State Board's final figures were then compiled in a
county land valuation order.
The land values contained within a land order are typically expressed in ranges
of base rates that are applied to various geographic areas, subdivisions, or neighborhoods
based on distinguishing characteristics or boundaries. Ind. Admin. Code tit. 50, r.
2.2-4-4(c) (1996). Consequently, properties within each geographic area, subdivision, or neighborhood in
a land order are presumed to be comparable, both in distinguishing characteristics and
market value. See Indianapolis Racquet Club, 743 N.E.2d at 251-52 (Ind. 2001).
Sometimes, [h]owever, properties often pos[s]ess peculiar attributes that do not allow them to
be lumped with each of the surrounding properties for purposes of valuation.
Phelps Dodge v. State Bd. of Tax Commrs, 705 N.E.2d 1099, 1105 (Ind.
Tax Ct. 1999), review denied. Consequently, the assessment regulations provide for the
use of influence factors to adjust, either upward or downward, the value placed
on a piece of property by the land order. An influence factor
refers to a condition peculiar to the lot that dictates an adjustment to
the extended value to account for variations from the norm[,] and is expressed
as a percentage increase or decrease in the subject lands assessed value, with
the percentage representing the composite effect of the factor that influences the value.
Ind. Admin. Code tit. 50, r. 2.2-4-10(a)(9) (1996); Ind. Admin. Code tit.
50, r. 2.2-4-17(c)(8) (1996). Indianas assessment regulations list seven factors that may
be the basis for influence factor adjustment. See Ind. Admin. Code tit.
50, r. 2.2-4-10(a)(9)(A)-(G) (1996). One of these factors, titled misimprovement, indicates that
a negative adjustment to the land is warranted because the parcel does not
have the same use as surrounding parcels. The base rate is computed
based on the predominant use of the surrounding parcels. 50 IAC 2.2-4-10(a)(9)(E).
The Marion County Land Order (Land Order) at issue in this case divided
Washington Township into 11 general geographic areas. (See Cert. Admin. R. at
228-32.) IRCs property fell within Area D, which was bordered by Keystone
Avenue on the west, 79th Street on the south, the Washington/Lawrence township line
on the east, and 96th Street on the north. (Cert. Admin. R.
at 230.) All primary land within Area D was valued between $4.80
and $5.10 per square foot, and all secondary land within that area was
valued between $3.36 and $3.57 per square foot. (See Cert. Admin. R.
IRC argues that these land values are invalid. IRC does not assert,
however, that the Land Order, or the base rates contained therein, is invalid
per se. (See Petr Reply Br. at 6-7.) Rather, IRC contends
that the application of the Land Order to its property is invalid.
More specifically, IRC argues that, as a result of mere geographic location, its
tennis facility, the only one in Area D, is lumped in with the
noncomparable high value retail properties that predominate Area D. (Petr Br.
at 4.) Consequently,
IRC claims that a misimprovement influence factor should be applied to its
To establish a prima facie case that the subject parcel is misimproved, IRC
must make a two-pronged showing.
See Quality Farm and Fleet, Inc. v.
State Bd. of Tax Commrs, 747 N.E.2d 88, 92 (Ind. Tax Ct. 2001).
First, IRC must submit probative evidence sufficient to show that its
parcel did not have the same use as surrounding parcels. See id.
Second, IRC must submit probative evidence sufficient to show that the inconsistent
use negatively impacted its lands value. See id.
The only evidence presented by IRC to establish its prima facie case was
the transcript of the Tax Court hearing conducted on its 1989 appeal of
the same parcel, (see Cert. Admin. R. at 98-227,) and the scant testimony
of its President, Stephen DeVoe:
This appeal is similar to the appeal filed with respect to the 1989
land assessment for this parcel. Accordingly, the transcript of the hearing [conducted
on the 1989 appeal] is [submitted as evidence in this hearing on the
The only difference between the 1989 assessment appeal and this one is that
there is a new 1995 County Land Order [that] applies to this assessment.
The 1995 County Land Order is similar to the 1989 Order in
that it is a mass appraisal order. Like the 1989 Order, the
1995 [O]rder establishes classifications but unlike the 1989 Order these classifications are based
solely on location. * * * * *
[As IRC established in its 1989 appeal, t]his parcel differs materially from the
surrounding properties with respect to significant factors and its use for other purposes
is substantially limited by its zoning. Further, the usage had been established
long before the surrounding areas and it is a low intensity, special commercial
* * * * *
[T]he rates actually used for these unusual properties in the past have been
far less than those applied to more highly developed properties which surround this
property. Further, the difference in the commercial use between this property and
the other commercial properties with which it is grouped in the 1995 Order
is a big difference in use. Accordingly, [IRC] believes that the appropriate
rate should be approximately 50% of the base rate for the surrounding properties[.]
(Cert. Admin. R. at 233-34.)
In essence, IRC believes that the transcript of the hearing on its 1989
appeal supports its claim that, for 1995, its parcel did not have the
same use as surrounding parcels. The use of this evidence, however, is
flawed for two reasons. First, this Court has rejected attempts by taxpayers
to put forth evidence, such as photographs, calculations, or assessment rules, without an
explanation. See, e.g., Heart City Chrysler v. State Bd. of Tax Comm'rs,
714 N.E.2d 329, 333 (Ind. Tax Ct. 1999). Similarly, this Court will
not accept a transcript from another hearing with the mere statement that it
makes our case. Rather, IRC was required to make a careful, methodical,
and detailed factual presentation to both the Indiana Board and this Court.
See Clark v. State Bd. of Tax Commrs, 779 N.E.2d 1277, 1282 n.4
(Ind. Tax Ct. 2002). In other words, IRC was required to go
through the transcript from the 1989 hearing and indicate what parts supported its
current position and how. See id. (stating that it is the taxpayer's
duty to walk the Indiana Board, as well as this Court, through every
element of the analysis; arguments that (1) generically claim without explanation that the
taxpayer made a prima facie case and (2) cite to large portions of
the record as though the evidence speaks for itself do not constitute probative
IRCs evidence is also flawed because it deals with a tax year not
in question here. In this Court, each tax year, and each appeals
process, stands alone. Barth, Inc. v. State Bd. of Tax Comm'rs, 699
N.E.2d 800, 805 n. 14 (Ind. Tax Ct.1998). While the 1989 hearing
transcript shows that IRCs land was not grouped with comparable parcels when it
was classified in the 82nd Street Corridor provision of the 1989 Marion County
Land Order, see Indianapolis Racquet Club, 743 N.E.2d at 252, it does not
necessarily show that IRCs land was improperly classified in the Area D provision
of the 1995 land order. Indeed, under the 1989 land order, the
82nd Street Corridor provision was fairly narrow in terms of its geographic boundaries.
Under the 1995 land order, however, Area D not only encompasses the
nd Street Corridor classification, but extends its borders to the Washington Township
boundaries. See supra. As a result, Area D is a much
larger, more developed, and more diverse land grouping than its predecessor, the 82nd
To show that the transcript on the 1989 appeal is applicable to its
1995 appeal, IRC was required to do more than say the facts havent
changed from 1989. Rather, it was required to make an affirmative showing
that evidence demonstrating that its property did not properly fall within the 82nd
Street Corridor provision under the 1989 Marion County Land Order also demonstrates that
its property does not fall within the much larger, more developed, and more
diverse Area D of the 1995 Land Order. Without this explanation or
comparison, neither the transcript nor the testimony supports IRC's case. See Herb
v. State Bd. of Tax Comm'rs, 656 N.E.2d 890, 893 (Ind. Tax Ct.
1995) (stating that "[a]llegations, unsupported by factual evidence, remain mere allegations"). Therefore,
the Court finds that IRC has failed to establish that its lands use
is different from surrounding parcels for the 1995 assessment year.
Assuming (for arguments sake only) that IRC has shown its land use is
different from that of the other parcels included in Area D, IRC was
still obligated to produce probative evidence showing how its inconsistent use decreased the
value of its parcel. It did not. In fact, all IRC
has done is tell the Indiana Board that its land has a different
use and then say as a result, were entitled to a 50% adjustment.
However, IRC needed to link one with the other by showing an
actual loss of value. See Quality Farm and Fleet, 747 N.E.2d at
92. In other words, IRC needed to submit evidence demonstrating how the
alleged inconsistent use negatively impacted its lands value. Instead, IRC focused exclusively
on the differing land uses and ignored the need to identify a decrease
in value. Consequently, IRC failed to establish the second prong necessary for
a prima facie case.
For the foregoing reasons, the Court AFFIRMS the Indiana Boards final determination on
For the 1995 assessment, commercial and industrial land was classified according to
its use. IND. ADMIN. CODE tit. 50, r. 2.2-4-17 (1996).
Consequently, "primary commercial or industrial land" refers to the primary building or
plant site, whereas "secondary commercial or industrial land" refers to land utilized for
purposes secondary to the primary use of the land. IND. ADMIN. CODE
tit. 50, r. 2.2-4-1(18), (19) (1996).
Footnote: On December 31, 2001, the legislature abolished the State Board of
Tax Commissioners (State Board). 2001 Ind. Acts 198 § 119(b)(2). Effective
January 1, 2002, the legislature created the Indiana Board of Tax Review (Indiana
Board) as successor to the State Board.
Ind. Code §§ 6-1.5-1-3; 6-1.5-4-1;
2001 Ind. Acts 198 § 95. Thus, when a final determination was
issued on IRCs appeal in April 2002, it was issued by the Indiana
Actually, IRC does not ask for an influence factor per se.
Rather, it merely asserts that the appropriate rate to be applied to
its land is $2.40 for primary land and $1.68 for secondary land.
(Cert. Admin. R. at 60.) (
See also Petr Reply Br. at 8.)
Given the fact that 1) the application of an influence factor
is the only way by which the value of IRCs land can be
reduced under this Land Order; and 2) a misimprovement influence factor most accurately
reflects IRCs argument, this Court construes IRCs request as one for the application
of a misimprovement influence factor. But cf. State Bd. of Tax Commrs
v. Indianapolis Racquet Club, Inc., 743 N.E.2d 247, 252-53 (Ind. 2001) (explaining that
under the 1989 Marion County Land Order, instead of seeking an influence factor,
a catch-all provision titled Township-Other allowed taxpayer to receive a reclassification of --
and reduction to -- its land value; such a provision does not, however,
exist in this case). If IRC did not intend this result, then
the Court reminds IRC to be more specific in presenting its argument to
nd Street Corridor provision of the 1989 Marion County Land
Order encompassed those properties located between Allisonville Road W. to Keystone on [82/]86th
St. fr Dean Rd. Keystone No. to I-465 Interch fr 86th St.
Indianapolis Racquet Club, Inc. v. State Bd. of Tax Commrs, 722 N.E.2d 926,
930 (Ind. Tax Ct. 2000) (footnote omitted), revd on other grounds by 743
N.E.2d 247 (Ind. 2001).