29. In this case, the Respondent had the burden of proof. The Respondent presented a USPAP compliant appraisal prepared by John Leader that was dated December 19, 2013. It had an effective date of “2008–2010.” Resp’t Ex. 1. Mr. Leader valued the subject property using all three approaches to value: the cost approach, the income approach, and the sales comparison approach. He placed the most weight on the cost approach and valued the subject property at $12,900,000. In his cost approach Mr. Leader used the square foot methodology with increased adjustments for building heights of twenty feet. He estimated the value for 2009, but not for 2008, because of some “land errors.” Mr. Leader stated that this value could also suffice for 2008 because there was not much change in the market.
30. In his sales comparison approach to value, Mr. Leader did not view the local lease agreements for the subject property, but did look at the income and expense data acquired from the owner. In the regression analysis he used Loop Net sales that represented regional and national retail sales from 2008 through 2010. The building areas ranged from 6,400 square feet to 125,238 square feet. Mr. Leader adjusted these sales to the local market, and came up with a value of $13,044,455 for the subject property under the sales comparison approach. Once again, the sales used in Mr. Leader’s analysis were much smaller and the majority of the sales were from 2009 and 2010, with the exception of three from 2008.
31. Further, the income approach in the Respondent’s appraisal was flawed. Mr. Leader relied on market rents of “similar” properties; however, the properties he relied on differed in size and in use when compared to the subject property. Mr. Leader did not go into detail about any adjustments made in his income approach to account for the differences that existed. Again, the major problem with Mr. Leader’s income approach is that he did not relate his income approach to the valuation date of January 1, 2007.
32. Mr. Leader presented his appraisal information for the years of 2008 through 2010. He did not calculate specific values for 2008 but instead stated that the market was steady for all of the years included in his appraisal. He provided no support for his assumption. To elaborate on Mr. Leader’s appraisal, there were multiple flaws. There was not enough information in the appraisal from 2008 to form a value of opinion for the March 1, 2008, assessment date. For instance, Mr. Leader stated that there was a problem with the land valuation through the assessor for the 2008 assessment and therefore used his 2009 calculation as his cost approach to value. However, he failed to explain how this information related to the relevant valuation date of January 1, 2007. Further, the sales used in the income and sales comparison approaches were mostly from 2009 and 2010. The local assessing officials were instructed to use sales of properties occurring between January 1, 2007, and December 31, 2008, in performing ratio studies for a March 1, 2008, assessment date. Mr. Leader’s comparable sales information was more in line with 2009 and moving forward. The Respondent did not present a prima facie case that the 2008 assessment value should be $12,900,000, or that the current assessment of $12,870,800 is correct.
33. Because the Respondent failed to meet her burden of proof, the 2008 assessment must be reduced to the previous year’s level of $12,253,100. That, however, does not end the Board’s inquiry. The Petitioner requested that the 2008 assessment be lowered to $7,000,000. Thus, the Petitioner has the burden of proving that it is entitled to any additional reduction. The Board therefore turns to the Petitioner’s evidence.
34. The Petitioner offered an appraisal performed by Mr. Edison and Mr. Dillman, both certified appraisers. Mr. Edison and Mr. Dillman performed the appraisal according to USPAP guidelines. The effective date of the appraisal is January 1, 2011. Both Mr. Edison and Mr. Dillman contend the appraisal applies to 2008 through 2011. Mr. Edison and Mr. Dillman utilized the cost, income and sales comparison approaches to value. The cost approach and the sales comparison approach both valued the subject property at $7,100,000. The income approach valued the subject property at $6,900,000.
35. The Petitioner’s appraisal is flawed in various ways, but most importantly, the appraisal does not appear to reflect the market for the assessment date in question, March 1, 2008. The information used in the Petitioner’s appraisal is from 2010 and 2011 and is too far removed from the valuation date of January 1, 2007. Further, the valuation date was never even mentioned in the appraisal. Although, Mr. Edison and Mr. Dillman claim that the appraisal incorporates 2008, the appraisal itself contains no such statement. Using income and expense data from 2010 and 2011 and sales from 2009 through 2011 without relating it back to 2008 falls short of what is required. Thus, the Petitioner did not meet its burden to reduce the property to $7,000,000.
36. In a sense, the parties have agreed through their evidence that, whatever the value of the subject property was, it was the same in 2008, 2009, and 2010. Both parties seem to agree that the market was static for this time period. However, for this appeal the valuation date was January 1, 2007. Neither party’s appraisal even mentions this date. And at the hearing, neither appraiser made any attempt to relate his respective value estimate to January 1, 2007. The appraisers only asserted through testimony that their retrospective value estimates applied to 2008 and forward. Because the valuation date in question here is January 1, 2007, neither appraiser offered probative evidence of the subject property’s correct 2008 assessment.
37. In this appeal, neither party offered probative evidence of the value for March 1, 2008, or January 1, 2007. Consequently, because neither the Respondent nor the Petitioner met the burden of proof, the assessment reverts back to the prior year, or March 1, 2007, assessment of $12,253,100. See Ind. Code § 6-1.1-15-17.2(b) (2014).