ATTORNEY FOR PETITIONER: ATTORNEYS FOR RESPONDENT:
JOSEPH D. GEESLIN, JR. STEVE CARTER
Attorney at Law ATTORNEY GENERAL OF INDIANA
Indianapolis, IN Indianapolis, IN
DEPUTY ATTORNEY GENERAL
INDIANA TAX COURT
EASTGATE ASSOCIATES, )
v. ) Cause Nos. 49T10-9611-TA-171
STATE BOARD OF TAX COMMISSIONERS, )
COMMISSIONERS, PEGGY BOEHM, )
Chairperson, WANDA K. WATTS, Member, )
GORDON E. MCINTYRE, Member, )
ON APPEAL FROM FINAL DETERMINATIONS OF THE
STATE BOARD OF TAX COMMISSIONERS
NOT FOR PUBLICATION
March 6, 2001
Petitioner Eastgate Associates (Eastgate) challenges the State Board of Tax Commissioners (State Board)
assessed values for two of its parcels as of the March 1, 1989
assessment date and for one of its parcels as of the March 1,
1992 assessment date. Eastgate asserts that the State Board misapplied the 1989
Marion County Land Valuation Order (Land Order) in assessing the parcels. The
sole issue before the Court is whether the State Board erroneously classified the
parcels at issue under the Land Order and thereby assigned excessive base values
to the contested parcels for the tax years under review.
FACTS AND PROCEDURAL HISTORY
This original tax appeal involves two parcels of land in Warren Township of
Marion County, Indiana: parcel numbers 7022779 (Main Parcel) and 7034285 (Out-Lot Parcel).
These parcels are located along Shadeland Avenue. Eastgate owns the Eastgate
Consumer Mall (Mall), which is located on the Main Parcel. The Out-Lot
Parcel is adjacent to the Main Parcel and located just west of the
Mall, between the Mall and Shadeland Avenue. The Marion County Board of
Review (BOR) fixed the Main Parcels value at $1,492,900 as of the March
1, 1989 assessment date. On April 27, 1990, Eastgate filed a Form
131 Petition for Review with the county auditor, which the State Board received
on May 14, 1990. The State Board conducted a hearing on this
petition on April 27, 1994. The State Board issued no final determination
on Eastgates petition. Therefore, Eastgate filed an original tax appeal with the
Tax Court on November 25, 1996, pursuant to Ind. Code Ann. § 6-1.1-15-4(e)
(West 1989) (amended 1993, 1995 & 1997).
See footnote This appeal was assigned Cause
No. 49T10-9611-TA-171 (Case 171).
On April 27, 1990, Eastgate also filed a Form 131 Petition for Review
challenging the BORs assessment of the Out-Lot Parcel, which it had valued at
$34,970 for the March 1, 1989 assessment date. The State Board conducted
a hearing on this petition on April 4, 1994. On October 16,
1996, the State Board issued a Final Determination, stating in part:
Upon visual inspection of the subject parcel and in consideration of 50 IAC
2.1-4-2(f), it is determined [that] the land is classified correctly[.] The base
rates used to price the land are in accordance with the base rates
established in the Marion County Land Valuation Order. The petitioner failed to
submit specific evidence to show how the base rate of the land is
excessive. No change is made as a result of this issue.
(Respt Ex. 3, Final Determination at 2.)
ANALYSIS AND OPINION
On February 24, 1995, Eastgate filed a Form 131 Petition for Review challenging
the BORs assessed value of $1,536,830 for the Main Parcel as of the
March 1, 1992 assessment date.See footnote At some point, the State Board conducted
an administrative hearing on this petition and issued a Final Determination.See footnote (Trial
Tr. at 14-16, 34.) Therefore, on November 25, 1996, Eastgate filed a
second original tax appeal with this Court, appealing the Final Determinations of the
Out-Lot Parcel as of March 1, 1989 and the Main Parcel as of
March 1, 1992. This second petition was assigned Cause No. 49T10-9611-TA-173 (Case
Per Eastgates request and the State Boards agreement, the Court has treated Cases
171 and 173 as a consolidated case. The Court conducted a trial
in this matter on January 25, 2000. At trial, the State Board
moved to remand this consolidated case, contending that the record was incomplete.
(Trial Tr. at 3.) The Court took the motion under advisement.
(Trial Tr. at 6.) After hearing testimony and receiving evidence, the Court
gave each party an opportunity to file a brief. Neither party elected
to submit a brief. The Court took the case under advisement on
March 14, 2000. Additional facts will be supplied where necessary.
Standard of Review
The Court gives great deference to the State Boards final determinations when the
State Board acts within the scope of its authority. Wetzel Enters., Inc.
v. State Bd. of Tax Commrs, 694 N.E.2d 1259, 1261 (Ind. Tax Ct.
1998). Accordingly, this Court reverses final determinations of the State Board only
when those decisions are unsupported by substantial evidence, are arbitrary or capricious, constitute
an abuse of discretion, or exceed statutory authority. Id. The taxpayer
bears the burden of demonstrating the invalidity of the State Boards final determination.
Clark v. State Bd. of Tax Commrs, 694 N.E.2d 1230, 1233 (Ind.
Tax Ct. 1998).
The issue to be resolved in each of the three claims is whether
the parcels in question were properly classified and assessed under the Land Order.
Land orders have the force of law. Indianapolis Historic Partners v.
State Bd. of Tax Commrs, 694 N.E.2d 1224, 1229 (Ind. Tax Ct. 1998).
Like administrative rules, land orders are subject to the same rules of
construction as statutes. Poracky v. State Bd. of Tax Commrs, 635 N.E.2d
235, 236 (Ind. Tax Ct. 1994). The Court will construe and interpret
a land order only if it is ambiguous. Indianapolis Historic Partners, 694
N.E.2d at 1227. In construing a land order, the first and foremost
rule of construction is to ascertain and give effect to the land commissions
intent, and the most reliable guide to that intent is the language of
the land order itself. Precedent v. State Bd. of Tax Commrs, 659
N.E.2d 701, 704 (Ind. Tax Ct. 1995). In construing the language of
a land order, courts must give words and phrases their plain, ordinary, and
usual meaning, unless it is apparent that the land commission intended some other
meaning. Id. at 705. The plain, ordinary, and usual meaning of
a word is usually found in a dictionary. Id.
The relevant part of the Land Order at issue was submitted into evidence
as Petitioners Exhibit 2. Eastgate maintains that both parcels should have been
assessed under the category listed on page 67 of the Land Order at
3080. This category is described as Shadeland Av[enue] Shopping Centers and
has the following per square foot values for land:
1) Primary Land: low value = $1.50; high value = $2.00
2) Secondary Land: low value = $1.05; high value = $1.40
3) Usable Undeveloped Land: low value = $.45; high value = $.60
4) Unusable Undeveloped Land: low value = $.05; high value = $.05.
(Petr Ex. 2.) The Court will refer to these values as the
3080 Values. According to Eastgate, the State Board incorrectly valued the land
at $3.00 per square foot. Eastgates basic argument is that the Mall
is a shopping center located on Shadeland Avenue, and therefore its parcels should
be priced using the 3080 Values. The State Board counters that the
parcels were classified properly pursuant to the category listed on page 67 of
the Land Order at 3078, which is described as follows: Shadeland Av[enue],
S. of I-70 to Washington St. Intersection.
See footnote (Petr Ex. 2.) This category
(the 3078 Values) has significantly different price ranges for land than the 3080
Values. For example, primary land for this category has a low value
of $3.00 per square foot and a high value of $4.00 per square
foottwice the base prices found in the 3080 Values. (Petr Ex. 2.) CONCLUSION
The Land Order is not ambiguous. The plain language of the Land
Order requires parcels along Shadeland Avenue with shopping centers to be priced using
the 3080 Values.
See Precedent, 659 N.E.2d at 705-06 (applying plain, ordinary,
and usual meaning of the phrase Townshipother in 1989 Marion County Land Order);
Indianapolis Historic Partners, 694 N.E.2d at 1227 (holding that Marion County Land Orders
Apartment Land schedule, as a matter of law, must be used to assess
taxpayers land, upon which was located a three-story, twenty-four unit apartment building).
Because the Main and Out-Lot Parcels are located along Shadeland Avenue, they must
be priced using the 3080 Values if shopping centers are located upon them.
(Petr Ex. 1.) See also supra n.4.
Accordingly, the Court must decide whether the subject parcels have shopping centers located
upon them. It is not clear whether the Marion County Land Valuation
Commission (Land Commission) intended the Land Order to classify the Mall as a
shopping center. The pages of the Land Order provided to the Court
do not define the term shopping centers as the term is used to
describe land to be assessed using the 3080 Values. In addition, the
Land Order as submitted does not define the term mall, which is used
on page 68 of the Land Order at 3092a category listed as S4
T15 R5 Washington Square Mall. (Petr Ex. 2.) Neither party has
advocated for a particular definition for the two terms. See CDI, Inc.
v. State Bd. of Tax Commrs, 725 N.E.2d 1015, 1022 n.8 (Ind. Tax
Ct. 2000) (stating that it is generally helpful if the [party] at least
attempts to provide a definition for the word or phrase at issue).
Thus, the Court must determine whether the Land Order considers a mall and
a shopping center to be the same type of structure.
The Court turns to the dictionary for assistance. Websters New World Dictionary
1316 (2d ed. 1982) defines shopping center as a complex of stores, restaurants,
etc. grouped together and having a common parking area. Similarly, Websters Third
New International Dictionary 2101 (1981) defines shopping center as a concentration of retail
stores and service establishments in a suburban area usu[ally] with generous parking space
and usu[ally] planned to serve a community or neighborhood. A mall may
be defined as a completely enclosed, air-conditioned shopping center. Websters New World
Dictionary 857 (2d ed. 1982). Thus, when applying the terms plain, ordinary
and usual meanings, a mall may be defined in part as an enclosed
Nothing in the State Boards regulations contradicts these plain language definitions.
See footnote The
regulations do have two models for shopping centers, the GCM Neighborhood and Regional
Shopping Center Models.
Ind. Admin. Code tit. 50, r. 2.1-4-7 (1992) (codified
in present form at id., r. 2.2-11-1(39) to (41) (1996)). Furthermore, the
regulations grade photographs show examples of these two models. Ind. Admin. Code
tit. 50, r. 2.1-4-6 (1992) (codified in present form at id., r. 2.2-11-4.1
(1996)). Finally, the regulations have a separate schedule for pricing a mall
concourse area, with this schedule distinguishing between open, covered, and enclosed malls.
Ind. Admin. Code tit. 50, r. 2.1-4-5 (1992) (Schedule H) (codified in present
form at id., 2.2-11-6 (1996) (Schedule E)). The regulations appear to distinguish
between a mall and a shopping center, but they do not appear to
make the terms mutually exclusive. The Court is also persuaded on this
point by what is not in the regulationsa separate and distinct model for
an entire mall (not just its concourse). Thus, the State Boards regulations
do not contradict and may in fact be viewed as consistent with the
plain language definitions of mall and shopping center. In other words, under
the regulations, a mall may be considered in part to be an enclosed
shopping center. The Court concludes that the Land Commission and State Board
intended to apply the plain language definitions of mall and shopping center in
developing and applying the Land Order.
As noted supra, the State Board at trial requested that the Court remand
this consolidated case because of the incompleteness of the record. (Trial Tr.
at 3.) The Court agrees that a remand of the entire case
is an appropriate course of action. The Court hereby GRANTS the State
Boards motion for a remand. All three assessments (i.e., the 1989 assessments
for both parcels and the 1992 assessment for the Main Parcel) are REMANDED
to the State Board for further proceedings. The State Board is ORDERED
to conduct a hearing on all three assessments and to accept any probative
evidence from the taxpayer regarding the construction of the Mall and the improvements
on the Out-Lot Parcel as of the assessment dates in question. The
State Board must deal with any probative evidence in a meaningful manner.
Kemp v. State Bd. of Tax Commrs, 726 N.E.2d 395, 404 (Ind. Tax
Ct. 2000). Moreover, the State Board must support its final determination on
the value of each parcel for the challenged tax years with substantial evidence.
Damon Corp. v. State Bd. of Tax Commrs, 738 N.E.2d 1102, 1112
(Ind. Tax Ct. 2000). If, through the submission of probative evidence, the
improvements on a subject parcel are found to be either a mall or
shopping center at the time of assessment, that parcel must be priced using
the 3080 Values in the Land Order. Otherwise, the 3078 Values must be
This provision provided:
If the state board of tax commissioners fails to conduct a hearing and
make a final determination required under [
Ind. Code § 6-1.1-15-4] within twelve (12)
months after the state board received a petition for review in a non-reassessment
year and twenty-four (24) months in a reassessment year, the person who petitioned
for review may initiate an appeal under [Ind. Code § 6-1.1-15-5] in the
same manner as if the state board had made a final determination affirming
the county board of reviews action with respect to the assessment.
This provision was amended prior to 1996 when Eastgate filed the present original
tax appeal. However, the Supreme Court has stated that it is the
code provision in effect at the time that the Form 131Petition for Review
is filed that controls, with respect to which version of section 6-1.1-15-4(e) applies.
State Bd. of Tax Commrs v. Mixmill Mfg. Co., 702 N.E.2d 701,
703 n.3 (Ind. 1998). Thus, Section 6-1.1-15-4(e), in its 1990 form, allowed
Eastgate to appeal the 1989 reassessment of the Main Parcel to the Tax
Court in 1996, because the State Board had issued no decision within twenty-four
months of having received the Petition for Review and because 1989 was a
general reassessment year.
A second Petition for Review was filed for the 1992 assessment, with
regard to the Out-Lot Parcel. This assessment is not an issue in
the present appeal. (Trial Tr. at 35.)
Footnote: Eastgates counsel indicated at trial that the State Board did issue a
Final Determination for the appeal of the Main Parcels 1992 assessment. (Trial
Tr. at 34.) The State Board did not deny or object to
this statement. However, neither party submitted a copy of this Final Determination.
Footnote: The $3.00 per square foot value assigned to the two parcels in
theory may have been priced pursuant to the values listed on page 67
of the Land Order at 3079, which category is described as Washington St.
Shadeland Av[enue] to I-465 Interchange. (Petr. Ex. 2.) This categorys
values mirror those of the 3078 Values. However, counsel for the parties
at trial agreed that this category was not applicable. (Trial Tr. at
36 & 37.) The real issue, as the Court observed at trial,
is whether the parcels in question should be valued from the 3078 or
3080 Values. (Trial Tr. at 36.) Therefore, the Court limits its
analysis to these two categories.
Footnote: The Land Order was drafted by the Land Commission and approved by
the State Board.
See Ind. Code Ann. § 6-1.1-4-13.6 (1989) (amended 1993,
1997) (requiring State Board to review countys proposed land values under former version
of statute). Thus, the regulations may properly be referenced for guidance in
ascertaining the commissions intent as to the definitions of the terms mall and