Here,
the Petitioners presented a market value appraisal prepared by Jeffrey R, Vale,
an Indiana certified appraiser and MAI, who prepared the appraisal in
accordance with USPAP. Using the sales comparison approach, the cost approach,
and the income capitalization approach, the appraiser estimated the value of
the property to be $1,155,000 as of January 1, 2009. An appraisal performed in
conformance with generally recognized appraisal principles is often enough to
establish a prima facie case that a property’s assessment is incorrect. See
Meridian Towers East & West v. Washington Township Assessor, 805 N.E.2d
475, 479 (Ind. Tax Ct. 2003). Further, the Petitioners’ representative
presented some evidence to trend the appraised value to the correct valuation
dates. Thus, the Board finds that the Petitioners raised a prima facie case
that their property should be assessed at $1,224,700 for March 1, 2008, $1,238,200
for March 1, 2009, and $1,058,000 for March 1, 2010.
The
Petitioners also presented the sales disclosure form and the closing statement
from the purchase of the subject property for $1,050,000 on January 22, 2009.
However, Mr. Hume admitted that the sale was a negotiated deal among real
estate investors – some of whom had interests in the both sides of the
transaction. The Respondent’s appraiser voiced the same concern in his
appraisal. Moreover, the Respondent’s appraiser contends that public records
show that the purchase price was $1,315,593. Thus, because the property was not
widely marketed, the buyer and seller shared some common investors, and because
the actual price of the property is in dispute, the Board finds that the
property’s purchase price is less reliable than the property’s appraised value.
Once
the Petitioners raised a prima facie case that their property was over-valued,
the burden shifts to the assessing official to rebut the Petitioners’ evidence.
See American United Life Insurance Co. v. Maley, 803 N.E.2d 276 (Ind.
Tax Ct. 2004). To rebut or impeach the
Petitioners’ case, the Respondent has the same burden to present probative
evidence that the Petitioners faced to raise a prima facie case. Fidelity
Federal Savings & Loan v. Jennings County Assessor, 836 N.E.2d 1075,
1082 (Ind. Tax Ct. 2005).
Here,
the Respondent also presented an appraisal of the property’s market value. The
Respondent’s appraisal was prepared by William Stronks, an Indiana certified
general appraiser who prepared the appraisal in accordance with USPAP. Mr.
Stronks used all three approaches to value and estimated the value of the
property to be $1,550,000 as of January 1, 2009. While Mr. Stronks did not
provide any explanation about how the appraisal of January 1, 2009, might
demonstrate or be relevant to the value of the property as of January 1, 2007,
January 1, 2008, or March 1, 2010, the Respondent’s appraiser valued the
property as of the same date the Petitioners’ appraiser used. Thus, there is
some evidence in the record that trends the property’s appraised value to the
relevant valuation dates.
Both
the Petitioners’ appraisal and the Respondent’s appraisal occurred sufficiently
contemporaneously with the statutory valuation dates to be probative of the
property’s value for the 2008, 2009 and 2010 assessment dates. The Board must,
therefore, weigh the evidence presented by both parties and determine the most
persuasive evidence of the property’s value.
First,
although both appraisers used the same comparable land sales to develop the
land value for the subject property, the Respondent’s appraiser used a sale
price of $375,000 for 7101 E. 81st Avenue. The Petitioners’ appraiser, however,
presented the sales disclosure information showing the property sold for
$300,000. Mr. Vale also contends the 30% adjustment to 9527 Broadway for zoning
used by Mr. Stronks is excessive because the property is surrounded by
commercial property and there is no justification for believing a zoning change
would cost $114,000.
Mr.
Vale also contends that the sale price of $875,000 for 218 South East Street
used by Mr. Stronks in his sales comparison approach to value is incorrect. Mr.
Vale submitted the sales disclosure form which shows that the property sold for
$666,000. Mr. Vale further contends that the location adjustments in the
Respondent’s appraisal are too low because the subject property is hidden. Mr.
Vale argues that the Petitioners’ property is not located on a major
thoroughfare like the Respondent’s appraiser’s comparable sales.
Further,
Mr. Vale disagreed with Mr. Stronks’ value using the income capitalization
approach. Mr. Vale argues that 4340 Lincoln Highway in Matteson, Illinois, and
2744 East 146th Street in Carmel, Indiana, are leased to national health clubs
who would not be interested in the subject property because of its location.
Further, the properties located at 4340 Lincoln Highway in Matteson, Illinois,
2744 East 146th Street in Carmel, Indiana, and 9159 Wicker Boulevard
in St. John, Indiana, are all on commercial thoroughfares unlike the subject
property.
The
Respondent, on the other hand, did not raise any issues with the Petitioners’
appraisal. In fact, Mr. Metz testified, “I believe both appraisals took into
consideration all three approaches to value and both appraisers probably ran
into the same problems, separately, the lack of comparable sales and,
obviously, the limitations to the three different approaches to value.” And he
concluded “[i]t appears like they both came to a somewhat similar conclusion.”
Thus, because of the errors identified by the Petitioners’ appraiser in the
Respondent’s appraisal and the Respondent’s failure to present any impeachment
or rebuttal evidence, the Board finds the Petitioners’ appraisal more probative
of the subject property’s market value-in-use for the 2008, 2009 and 2010
assessment years.
