PETITIONERS PRO SE:
JAMES R. KEMPER
PAMELA ANN KEMPER
ATTORNEYS FOR THE RESPONDENT:
ATTORNEY GENERAL OF INDIANA
LINDA I. VILLEGAS
DEPUTY ATTORNEY GENERAL
INDIANA TAX COURT
JAMES R. KEMPER & PAMELA ANN )
v. ) Cause No. 49T10-9911-TA-214
DEPARTMENT OF LOCAL )
ON APPEAL FROM A FINAL DETERMINATION
OF THE STATE BOARD OF TAX COMMISSIONERS
NOT FOR PUBLICATION
May 27, 2003
James R. Kemper and Pamela Ann Kemper appeal the final determination of the
State Board of Tax Commissioners (State Board) valuing their real property for the
March 1, 1995 assessment. The sole issue is whether the State Board
erred in applying a neighborhood desirability rating of good to the Kempers property.
For the reasons stated below, the Court AFFIRMS the State Boards final
FACTS AND PROCEDURAL HISTORY
The Kempers own land and a residential improvement at 6175 Rucker Road in
Lawrence Township, Marion County, Indiana. For the 1995 assessment, the Kempers property
was assessed with a neighborhood desirability rating of good. The Kempers appealed
their assessment to the Marion County Board of Review (BOR), which denied them
The Kempers subsequently filed a Form 131 Petition for Review of Assessment (131
Petition) with the State Board, challenging their neighborhood desirability rating. The State
Board held a hearing and, on October 29, 1999, issued a final determination,
making no change to the Kempers neighborhood desirability rating.
On November 18, 1999, the Kempers initiated an original tax appeal. On
November 13, 2000, the Court held a trial. Additional facts will be
supplied as necessary.
ANALYSIS AND OPINION
Standard of Review
This Court gives great deference to the final determinations of the State Board
when it acts within the scope of its authority. Thousand Trails, Inc.
v. State Bd. of Tax Commrs, 757 N.E.2d 1072, 1075 (Ind. Tax Ct.
2001). This Court will reverse a final determination of the State Board
only when its findings are unsupported by substantial evidence, arbitrary, capricious, constitute an
abuse of discretion, or exceed statutory authority. Id.
Furthermore, a taxpayer who appeals to this Court from a State Board final
determination bears the burden of showing that the final determination was invalid.
Id. The taxpayer must present a prima facie case by submitting probative evidence,
i.e., evidence sufficient to establish a given fact that, if not contradicted, will
remain sufficient. Id. Once the taxpayer presents a prima facie case,
the burden shifts to the State Board to rebut the taxpayers evidence and
support its findings with substantial evidence. Id.
The sole issue is whether the State Board erred in applying a neighborhood
desirability rating of good to the Kempers property. The Kempers argue that
the condition of Rucker Road militates against a good rating for their neighborhood.
The State Board, on the other hand, argues that the Kempers failed
to submit any probative evidence to support their claim. The State Board
Under the State Boards rules, neighborhood desirability factors into calculating physical depreciation for
residential improvements. Ind. Admin. Code tit. 50, r. 2.2-7-9(c) (1996). It
constitutes a composite judgment of the overall desirability based on . . .
the extent of residential benefits arising from the location of the dwelling.
Ind. Admin. Code tit. 50, r. 2.2-7-7.1(f)(7) (1996). Accordingly, an evaluation of
neighborhood desirability looks beyond the improvement itself to external features of the propertys
location that may affect its value. Corey v. State Bd. of Tax
Commrs, 674 N.E.2d 1062, 1065 (Ind. Tax Ct. 1997). The rating level
describes the balance between desirable and undesirable factors in the improvements location.
Id. In striking this balance, location of a parcel is simply the
beginning of the analysis, as land values may deviate substantially throughout a geographic
area. See Ind. Admin. Code tit. 50, r. 2.2-4-13(c) (1996). The
boundaries of the geographic area and the characteristics of the area determine the
amount of variation in value. Id.
The State Boards rules note that [i]t is impossible to create a precise
formula that measures every variable of location and converts those variables into a
precise value. Id. Nevertheless, the State Board established a range of
neighborhood desirability ratings with guidelines as to their application to residential parcels.
Id. The Kempers neighborhood desirability rating was good, which the State Boards
rules define as an attractive and desirable area. 50 IAC 2.2-7-7.1(f)(7)(C).
More specifically, a good rating indicates the location is pleasant. Generally, this location
is an improving area with good access to shopping, schools, and major roads.
This location may be in close proximity to recreational facilities. 50
The Kempers allege that their neighborhood desirability rating should be average. The
State Boards rules define average as an average area. 50 IAC 2.2-7-7.1(f)(7)(D).
Specifically, an average rating indicates the location is typical. Generally, this
location is a static area with little or no evidence of new development.
The distance to shopping, schools, and major roads is acceptable. The
average location is neither particularly attractive nor unattractive. It has some characteristics that
make it attractive and desirable, but these characteristics may be offset by other
which make it less desirable. 50 IAC 2.2-4-13(c)(4).
The Kempers bear the burden of proving that their neighborhood desirability rating is
incorrect. Corey, 674 N.E.2d at 106566. Mr. Kemper testified:
Rucker Road is an interconnect from Highway 37, now called Binford Boulevard, and
Ts in down at Fall Creek Road some two blocks south of the
property. The Road is extremely hilly and at times your vision of
oncoming cars is even blocked, and in a lighted situation with headlights at
night there are blind spots of [sic] the oncoming car[s]. . . .
school is some three miles distant, [and] the bus line
is a mile distant. [Rucker Road] is a narrow, two-lane road, no
curbs, [and] no sidewalks[.]
(Trial Tr. at 78, 13.)
The Kempers needed to submit sufficient evidence of undesirable features to show that,
on balance, the area in which they live is not attractive, desirable, or
pleasant as defined by the State Boards rules.
See 50 IAC 2.2-4-13(c)(3);
Corey, 674 N.E.2d at 1065. Mr. Kempers testimony merely shows that he
lives near a narrow, hilly road, which is not sufficient to tip the
balance away from the State Boards neighborhood desirability rating of good. Indeed,
nothing in Mr. Kempers testimony raises a doubt as to whether the State
Board correctly determined that his neighborhood is an improving area with good access
to shopping, schools, and major roads.
See 50 IAC 2.2-4-13(c)(3). See
also Corey, 674 N.E.2d at 106566 (holding that taxpayers have the burden of
showing that their neighborhood desirability rating is incorrect). Consequently, the Kempers have
not submitted probative evidence showing that the State Board erred when it assessed
their property with a neighborhood desirability rating of good. Because the Kempers
have not submitted probative evidence, they have not made a prima facie case.
Accordingly, the Court AFFIRMS the State Boards final determination.
For the aforementioned reasons, the Court AFFIRMS the State Boards final determination on
the Kempers neighborhood desirability rating.
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. 2001 Ind. Acts 198 § 119(b)(2). Effective January 1,
2002, the Legislature created the Department of Local Government Finance (DLGF) and the
Indiana Board of Tax Review (Indiana Board).
Ind. Code §§ 6-1.1-30-1.1; 6-1.5-1-3
(West Supp. 2001); 2001 Ind. Acts 198 §§ 66, 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. 2002); 2001
Ind. Acts 198 § 95. Nevertheless, the law in effect prior to
January 1, 2002 applies to these appeals. I.C. § 6-1.5-5-8. See
also 2001 Ind. Acts 198 § 117. Although the DLGF has been
substituted as the Respondent, this Court will still reference the State Board throughout
The Kempers also claim that the method of assessing their land varies
from year to year from the front-foot method to the acreage method.
They ask that the method be consistent from year to year. Because
the Kempers never raised this issue before the State Board, the Court is
precluded from reviewing it.
See Fleet Supply, Inc. v. State Bd. of
Tax Commrs, 740 N.E.2d 598, 599 n.1 (Ind. Tax Ct. 2000); Whitley Prods.
v. State Bd. of Tax Commrs, 704 N.E.2d 1113, 1119 (Ind. Tax Ct.
1998), review denied.
At trial, the Kempers attempted to introduce evidence that they never presented
to the State Board. The Courts scope of review, however, precludes it
from considering evidence not presented to the State Board.
Fleet Supply, 740
N.E.2d at 599 n.1.
Just because a road is hilly and narrow does not necessarily mean
that it provides poor access.
Cf. Hamm v. Dept of Local Govt Finance,
2003 WL 1987147 **34 (finding that a poorly maintained, one-lane county road that
was impassible during bad weather was sufficient evidence that the taxpayer lacked good
access to major metropolitan areas).