INDIANA TAX COURT
BLACKBIRD FARMS APARTMENTS, LP, )
v. ) Cause No. 49T10-9812-TA-205
DEPARMENT OF LOCAL )
GOVERNMENT FINANCE, )
ORDER ON MOTION TO CORRECT ERROR
NOT FOR PUBLICATION
October 31, 2002
Comes now Blackbird Farms Apartments, LP (Blackbird) and files a Motion to Correct
Error (Motion) under Indiana Trial Rule 59. In its Motion, Blackbird challenges
this Courts holding in Blackbird Farms Apartments, LP v. Department of Local Government
Finance, 765 N.E.2d 711 (Ind. Tax Ct. 2002). Having reviewed Blackbirds Motion
and having held a hearing with regard thereto, the Court now DENIES Blackbirds
Motion for the reasons set forth below.
FACTS AND PROCEDURAL HISTORY
Blackbird owns real property (thirteen acres of land and a 154-unit apartment complex)
in Wabash Township, Tippecanoe County, Indiana. For the 1995 general reassessment, the
State Board of Tax Commissioners (State Board) valued Blackbirds land at $60,000 per
acre pursuant to the portion of the Tippecanoe County Land Order (Land Order)
applicable to Wabash Township. (See Stip. Ex. I).
Blackbird filed an original tax appeal with this Court on December 18, 1998,
challenging the assessment. After conducting trial and oral argument, this Court issued
an opinion affirming the State Board. Blackbird Farms, 765 N.E.2d at 716.
On April 16, 2002, Blackbird timely filed a Motion to Correct Error,
claiming that the Courts decision was erroneous because it misstate[d] the record, ignore[d]
Petitioners evidence, improperly applie[d] the prima facie standard, and ma[de] numerous errors of
law. (Petr Mot. to Correct Error at 26.) Additional facts will
be provided as necessary.
ANALYSIS & ORDER
Essentially, Blackbirds Motion focuses on two alleged errors: 1) the Court held
Blackbird to a higher burden of proof than the required prima facie standard;
and 2) the Court ignored Blackbirds evidence.
I. Blackbirds Burden of Proof
Blackbird contends that while it presented a prima facie case and met its
minimal showing, the Court imposed a standard upon [it] far beyond that of
making a prima facie case [and . . .] conceived of arguments or
possible challenges which could be made to [the] evidence . . . and
rejected [the] evidence because it did not disprove these possible challenges. (Petrs
Mot. to Correct Errors at 2-3) (emphasis in original.) The Court disagrees.
This Court accords great deference to the State Board when it 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, 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.
Because Blackbird was the party challenging the propriety of the State Boards final
determination, it bore the burden of demonstrating the final determinations invalidity. See
Clark v. State Bd. of Tax Commrs, 694 N.E.2d 1230, 1233 (Ind. Tax
Ct. 1998). To meet its burden, Blackbird was required to 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. See
id. (quoting GTE N., Inc. v. State Bd. of Tax Commrs, 634 N.E.2d
882, 887 (Ind. Tax Ct. 1994)).
In other words, Blackbird was required
to offer probative evidence concerning the alleged assessment error. See Herb v.
State Bd. of Tax Comm'rs, 656 N.E.2d 890, 893 (Ind. Tax Ct.1995).
In this particular case, in order for Blackbird to establish a prima facie
case that its land was improperly assessed under the Land Order, it was
required to make a two-prong showing that: 1) comparable properties 2) were
assessed and taxed differently. Blackbird Farms, 765 N.E.2d at 714 (citing 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)).
II. Blackbirds Evidence
At the administrative hearing, Blackbird submitted evidence showing that seven other apartment complexes
in Tippecanoe County were assessed between $30,000 and $36,000 per acre. (See
Stip. Ex. H.) The apartment complexes, however, were not in Wabash Township,
but rather in Fairfield Township, which is on the other side of the
Tippecanoe River. The Court reviewed the evidence and determined that it did
not make a prima facie showing that the properties were comparable. Blackbird
Farms, 765 N.E.2d at 715. Specifically, the Court held that because these
properties were not subject to the same part of the land order as
Blackbird, they could not be presumed comparable. Id. at 714-15 (emphasis added)
(citing State Bd. of Tax Commrs v. Indianapolis Racquet Club, 743 N.E.2d 247,
251-52 (Ind. 2001)). Absent that presumption, the Court stated that Blackbird was
required to show something else as indicia of comparability:
Whether or not properties are similar enough to be considered comparable depends on
a number of factors including (but not limited to) size, shape, topography, accessibility,
Id. (emphasis added) (quoting Beyer v. State, 280 N.E.2d 604, 607 (Ind. 1972)
(internal punctuation omitted)). See also Ind. Admin. Code tit. 50, r. 2.2-4-4.
The Court, after reviewing the administrative record, determined that it was void
of such a showing. Upon Blackbirds Motion, the Court reviewed the administrative
record again, and arrives at the same conclusion: Blackbird failed to show
how the seven other apartment complexes were comparable to its own.
while Blackbird presented evidence, it was not probative evidence, and therefore Blackbird failed
establish a prima facie case.
Blackbird also submitted evidence at the administrative hearing showing that at about the
time Blackbirds land was purchased in 1990 for $10,000 an acre, six other
land sales were made in the County, with an average sale price of
$22,000 per 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. Blackbird Farms, 765 N.E.2d at
715 (citing Petr Br. at 7).
Under Indianas true tax value system, the assessed value of nonagricultural land is
based, theoretically, on its approximate 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). Those values are compiled
and reflected in the county land orders and are applied to various geographic
areas, subdivisions, or neighborhoods based on distinguishing characteristics or boundaries. Ind. Code
§ 6-1.1-4-13.6; Ind. Admin Code tit. 50, r. 2.2-4-4.
Once again, Blackbirds alleged comparable land sales all occurred outside Wabash Township (see
Stip. Ex. G.) and were not subject to the same part of the
Land Order. Thus, they will not merely be presumed comparable. Blackbird
Farms, 765 N.E.2d at 714-15 (citing Indianapolis Racquet Club, 743 N.E.2d at 251-52).
Instead, Blackbird was required to show how those properties were comparable to
its own, and the record reveals it did not.
Furthermore, Blackbird provided
no evidence to substantiate its claim that developmental costs were indeed $8,000.
This Court originally found that Blackbird did not meet its initial burden of
proof. Blackbird Farms, 765 N.E.2d at 716. Upon review and for
the foregoing reasons, this Court again finds the same. Petitioners Motion to
Correct Error is hereby DENIED.
SO ORDERED this 31st day of October, 2002.
Thomas G. Fisher, Judge
James W. Beatty
James F. Beatty
Stephen M. Terrell
LANDMAN & BEATTY
1150 Market Square Center
151 North Delaware Street
P.O. Box 44953
Indianapolis, IN 46244-0953
Attorney General of Indiana
By: Ted J. Holaday
Deputy Attorney General
Indiana Government Center South, Fifth Floor
402 West Washington Street
Indianapolis, IN 46204-2770
The Court has previously reviewed the facts of this case.
See Blackbird Farms Apartments, LP v. Department of Local Government Finance, 765 N.E.2d
711, 712 (Ind. Tax Ct. 2002). Therefore, this Court will briefly review
only the relevant factual and procedural history of this case in order to
provide insight as to its current posture.
Blackbirds Motion asserts the Court
committed the following errors of law:
1. [It] erroneously ignored large amounts of the evidence presented by Petitioner,
mischaracterized the nature and extent of evidence submitted by the Petitioner, and misstated
the Record . . . .
2. [It] . . . missappl[ied] the law regarding a
prima facie case . . . .
3. [It] improperly imposed a burden upon Petitioner, as part of Petitioners prima
facie case, to disprove possible arguments by the Respondent.
4. [It] improperly required Petitioner as part of its prima facie case
to place into evidence certain portions of an administrative rule, where matters of
law are subject of judicial notice[.]
5. [It] incorrectly ignored summaries which [sic] were admitted under Ind. R.
Evid. 1006, and effectively require[d] that exhibits be read verbatim into the Record
before they may be considered by the Court, all of which is contrary
to Ind. Rules of Evidence . . . .
(Petr Mot. to Correct Error at 1-2.)
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. Clark v. State Bd. of
Tax Commrs, 694 N.E.2d 1230, 1233-35 (Ind. Tax Ct. 1998). If the
taxpayer does not present a prima facie case, however, the State Boards duty
to support its decision with substantial evidence is not triggered. Id.
Blackbirds evidence with respect to the seven apartment complexes did not
address shape or topography. With respect to size, Blackbird did submit the
record cards on the seven properties, but the Court (and presumably the State
Board) had to make the mathematical calculations to determine their sizes. The
State Board, and the Court, will not make Blackbirds case for it.
Clark v. State Bd. of Tax Commrs, 694 N.E.2d 1230, 1237 n.10 (Ind.
Tax Ct. 1998). At any rate, the sizes of these properties ranged
from less than one acre to more than fifteen acres. Size is
generally a less important element of comparison . . . [as m]ost types
of development have an optimal site size; if the site is larger, the
value of the excess land tends to decline at an accelerating rate. .
. . [A]ppraisers ordinarily give more weight to comparables that are approximately the
same size as the subject property. Appraisal Institute, The Appraisal of Real
Estate 303 (10th ed. 1992).
Blackbird also refers the Court to pages 17 through 19 in
the Trial Transcript for its testimony comparing the accessibility of its land with
the accessibility of the alleged comparables. (Petr Mot. to Correct Error at
7). The testimony contained in the transcript compares the proximity of the
alleged comparable apartment complexes to Blackbird Farms and Purdue University with phrases like
close to Purdue, hop on a bus and youre there, by way of
bus youre about the same, and as the crow flies. (Trial Tr.
at 17-23.) Unlike evidence of actual mileage, this testimony is not probative
evidence of proximity.
Again, no evidence was submitted comparing shape, topography and accessibility. (
Stip Ex. G.) Furthermore, with respect to size, the evidence indicates a
spread from one acre to seventy-three.