ATTORNEYS FOR PETITIONER: ATTORNEYS FOR RESPONDENT:
JAMES W. BEATTY STEVE CARTER
JAMES F. BEATTY ATTORNEY GENERAL OF INDIANA
STEPHEN M. TERRELL Indianapolis, IN
LANDMAN & BEATTY
TED J. HOLADAY
DEPUTY ATTORNEY GENERAL
INDIANA TAX COURT
BLACKBIRD FARMS APARTMENTS, LP, )
v. ) Cause No. 49T10-9812-TA-205
DEPARTMENT OF LOCAL )
ON APPEAL FROM THE FINAL
DETERMINATIONS OF THE STATE BOARD OF TAX COMMISSIONERS
April 2, 2002
Blackbird Farms Apartments, LP (Blackbird) appeals from three final determinations of the State
Board of Tax Commissioners (State Board) valuing its real property for the 1995
assessment. The sole issue before the Court is whether the State Board
erred in valuing Blackbirds land at $60,000 per acre.
FACTS AND PROCEDURAL HISTORY
Blackbirds real property, consisting of approximately thirteen acres of land and a 154-unit
apartment complex, is located in Wabash Township, Tippecanoe County, Indiana. The property
is situated at the intersection of Lindberg Road and McCormick Road in West
In accordance with Indiana Code § 6-1.1-4-13.6 (West 1989) (amended 1993), the State
Board promulgated a land order for use by Tippecanoe County assessing officials for
the 1995 general reassessment. Under that land order, the base rate values
of Blackbirds land could vary between $5,000 and $240,000 per acre. (See
Stip. Ex. I). Blackbirds land was valued at $60,000 per acre.
Believing this value to be too high, Blackbird filed three Form 130 Petitions
for Review of Assessment with the Tippecanoe County Board of Review (BOR).
The BOR reevaluated the assessment but declined to change the value
assigned to Blackbirds land.
Consequently, Blackbird filed three Form 131 Petitions for Review of Assessment with the
State Board. The State Board held a hearing on the petitions on
June 28, 1998. In its final determinations of November 30, 1998, however,
the State Board made no change to Blackbirds assessment.
Blackbird filed an original tax appeal with this Court on December 18, 1998.
The Court conducted a trial on December 20, 1999. Oral argument
was heard on September 11, 2000. Additional facts will be supplied as
STANDARD OF REVIEW
This Court accords great deference to the State Board when it acted 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, the
Court will reverse a State Board final determination only if it is unsupported
by substantial evidence, constitutes an abuse of discretion, exceeds statutory authority, or is
arbitrary and capricious. Id.
The party challenging the propriety of a State Board final determination bears the
burden of demonstrating its invalidity. Clark v. State Bd. of Tax Commrs,
694 N.E.2d 1230, 1233 (Ind. Tax Ct. 1998). To do so, the
taxpayer must present a prima facie case, or one in which the evidence
is sufficient to establish a given fact and which if not contradicted will
remain sufficient. Id. (quoting GTE N., Inc. v. State Bd.
of Tax Commrs, 634 N.E.2d 882, 887 (Ind. Tax Court 1994)). Although
the burden of proof never shifts, once the taxpayer presents a prima facie
case, the duty to go forward with the evidence shifts, and it is
incumbent on the State Board to rebut the taxpayers evidence and support its
decision with substantial evidence. Id.
DISCUSSION AND ANALYSIS
Blackbird challenges the $60,000 per acre value assigned to its land. It
asserts that, despite present[ing] a prima facie case that the assessment of its
apartment land [should have been between $30,000 and $36,000 an acre] . .
. the State Board did not come forward with substantial evidence . .
. to overcome Blackbird Farms evidence. (Petr Br. at 2, 5). In
response, the State Board contends that Blackbird did not prove a prima facie
case that the land was erroneously valued at $60,000 per acre. (Respt
Br. at 8,10). As a result, the State Board contends that its
duty to support its final determination . . . with substantial evidence is
not triggered. (Respt Br. at 10).
Under Indianas true tax value system, the assessed value of nonagricultural land is
based, theoretically, on its market value. Town of St. John et. al
v. State Bd. of Tax Commrs, 665 N.E.2d 965, 967 (Ind. Tax Ct.
1996) (St. John I) revd on other grounds by Boehm v. Town of
St. John, 675 N.E.2d 318 (Ind. 1996). Consequently, each county has its
own land valuation commission to collect and analyze sales data for the county
and, on the basis of that information, determine the values of all commercial,
residential, and industrial land therein. Ind. Code § 6-1.1-4-13.6(e). The State
Board reviews and approves the values submitted by the county commissions, modifying the
values if necessary in order to provide [for] uniformity and equality in assessments.
Ind. Code § 6-1.1-4-13.6(f).
Once the values are approved by the State Board, they are compiled in
a land order for use by the countys assessing officials.
Code § 6-1.1-4-13.6. The land values 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).
To challenge the base rate applied to its land under the
land order, Blackbird must present probative evidence that comparable properties are assessed and
taxed differently. See Zakutansky v. State Bd. of Tax Commrs, 691 N.E.2d
1365, 1369-70 (Ind. Tax Ct. 1998); Vonnegut v. State Bd. of Tax Commrs,
672 N.E.2d 87, 89-90 (Ind. Tax Ct. 1996); Poracky v. State Bd. of
Tax Commrs, 635 N.E.2d 235, 237 (Ind. Tax Ct. 1994). To meet
this burden, Blackbird introduced into evidence a list of apartment complexes in Tippecanoe
County where the land is assessed at either $30,000 or $36,000 an acre.
Blackbird also introduced a list of land sales in Tippecanoe County to
demonstrate that its assessment was too high in relation to the lands market
value. In reviewing this evidence, however, the Court determines that Blackbird did
not meet its burden of proof.
Comparable Land Assessments
During the administrative proceedings, Blackbird introduced evidence indicating that, for the 1995 assessment,
the land at seven comparable apartment complexes in Tippecanoe County had been assessed
significantly lower than Blackbirds land. Indeed, the land at those properties had
been assessed at either $30,000 an acre or $36,000 an acre. (Stip.
Ex. H). Blackbird maintains that [t]his [evidence in and] of itself is
sufficient to establish a prima facie case. (Petr Br. at 7).
The Court disagrees.
Years ago, Indianas Supreme Court emphasized that [w]hether or not properties are similar
enough to be considered comparable . . . depend[s] on a number of
factors including (but not limited to) size, shape, topography, accessibility, use, and[, in
the case of establishing a comparable sale,] closeness of the time of the
sale to the present action. Beyer v. State, 280 N.E.2d 604, 607
(Ind. 1972). The State Boards regulations have a similar emphasis:
The [county land valuation] commission shall use plat maps or recorded plats to
establish land value maps for the county. The land value maps show
outlines of blocks, streets, and alleys, and include all lots and their dimensions.
The commission shall collect sales data and land value estimates from licensed real
estate brokers and record this information on the maps. . . .
From the information, the commission shall delineate general geographic areas, subdivisions, or neighborhoods
based on characteristics that distinguish a particular geographic area, subdivision, or neighborhood from
the surrounding areas. The basis for delineation are [sic] such things as
Range of improvement values.
Restrictions on land use.
Natural geographic features, such as waterways, lakes, major roads, or streets.
Ind. Admin. Code tit. 50, r. 2.2-4-4(a), (b), (c). 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 State Bd.
of Tax Commrs v. Indianapolis Racquet Club, 743 N.E.2d 247, 251-52 (Ind. 2001).II. Land Sales
In the present case, Blackbird submitted assessment information on properties it believed to
be comparable. However, none of these comparable properties were in the same
township, and therefore not subject to the same portion of the land order.
Moreover, the record does not show that Blackbird explained how the land
at each of the apartment properties was comparable. Indeed, there is no
comparison of lot sizes or shapes, no comparison of topography or geographical features,
no comparison of lot accessibility and uses. Rather, Blackbird merely asserted that
the land is comparable. A taxpayers conclusory statement that something is
comparable does not constitute probative evidence.
Whitley Prods., Inc. v. State Bd.
of Tax Commrs, 704 N.E.2d 1113, 1119 (Ind. Tax Ct. 1998), review denied.
Because Blackbird did not present evidence that the land at the apartment
complexes was comparable to its own, it did not present a prima facie
case. This being so, the State Boards duty to support its decision
with substantial evidence was not triggered.
Clark, 694 N.E.2d at 1233.
Blackbird also submitted evidence at the administrative proceedings of comparable land sales in
Tippecanoe County. Specifically, it submitted a list indicating that, from a period
of 1990 to 1994, six land sales were made, with purchase prices ranging
from $11,000 an acre to $46,000 an acre, and averaging $22,000 an acre.
(Stip. Ex. G). Blackbird maintains that because the assessed value [of
a piece of land] is the raw price of land plus the cost
of development, and using the comparable assessments presented, these figures clearly support a
calculation of developmental costs at $8,000 per acre with an average assessed value
of $30,000 per acre. (Petr Br. at 7). Again, the Court
First, no evidence was submitted by Blackbird to substantiate that these land sales
were indeed comparable. As before, all the land sales were made in
other townships in Tippecanoe County.
See footnote Furthermore, Blackbird made no attempt to explain
how the land in its proposed comparables was similar to its own.See footnote
Finally, no evidence was submitted to substantiate the claim that developmental costs were
$8,000. Consequently, Blackbird failed to make a prima facie case, and therefore
the State Boards duty to
support its decision with substantial evidence was not
triggered. Clark, 694 N.E.2d at 1233.
Blackbird has not made a prima facie case with respect to the issue
of land valuation. Thus, for the foregoing reasons, the State Boards final
determination is AFFIRMED.
The State Board of Tax Commissioners (State Board) was originally the Respondent
in this appeal. However, the legislature abolished the State Board as of
December 31, 2001. P.L. 198-2001, § 119(b)(2). Effective January 1, 2002,
the legislature created the Department of Local Government Finance (DLGF),
see Indiana Code
§ 6-1.1-30-1.1 (West Supp. 2001)(eff. 1-1-02); P.L. 198-2001, § 66, and the Indiana
Board of Tax Review (Indiana Board). Ind. Code § 6-1.5-1-3 (West Supp.
2001)(eff. 1-1-02); P.L. 198-2001, § 95. Pursuant to Indiana Code § 6-1.5-5-8,
the DLGF is substituted for the State Board in appeals from final determinations
of the State Board that were issued before January 1, 2002. Ind.
Code § 6-1.5-5-8 (West Supp. 2001)(eff. 1-1-02); P.L. 198-2001, § 95. Nevertheless,
the law in effect prior to January 1, 2002 applies to these appeals.
Id. See also P.L. 198-2001, § 117. Although the DLGF
has been substituted as the Respondent, this Court will still reference the State
Board throughout this opinion.
Blackbirds real property is comprised of three separate real estate parcels.
For purposes of the administrative proceedings, as well as proceedings before this
Court, the three separate appeals were consolidated.
Footnote: As this Court explained years ago, the State Boards duty to
ensure uniformity and equality in tax rates and assessments is not an abstract
goal but rather a concrete obligation under both the state constitution and the
directives of the general assembly.
Bielski v. Zorn, 627 N.E.2d 880, 885
(Ind. Tax Ct. 1994).
The apartment properties Blackbird used as comparables were all located in Fairfield
Township, Tippecanoe County. The only portion of the land order that was
submitted into evidence, however, was the portion titled Wabash Township, Tippecanoe County.
Included in an effort to compare similarities between the subject property and the
properties used as comparables would be the portion of the land order relating
to Fairfield Township.
Nevertheless, the State Board did submit evidence (via the county assessor) to
support its final determination consisting of: six apartment complexes in the same
township (Wabash) (and consequently subject to the same part of the land order)
with land assessments at $60,000 per acre. (
See Stip. Exs. J2, J3,
J4, and J5).
Blackbird claims there were no comparable land sales made in Wabash Township
at the same time it purchased its land, and it therefore had to
rely on sales outside the township. That being said, it was still
incumbent on Blackbird to show how those land sales outside Wabash Township were
comparable to its own.
There was some supporting documentation submitted with Blackbirds list indicating that only
three of the comparable properties had similar zoning designations, and only two had
documentation stating that the transaction was made at arms length. Despite the
ability to read of all those involved, mere reference to evidence or documentation
without explanation will not qualify as probative evidence.
See Heart City Chrysler
v. State Bd. of Tax Commrs, 714 N.E.2d 329, 333 (Ind. Tax
Ct. 1999) (indicating that mere references to photographs or State Board regulations, without
explanation, will not qualify as probative evidence).