Tax Court Remands to DLGF to Consider Taxpayer's Argument that Township Must Bear Full Cost of Loan Despite Fire Department's Use of Vehicle Outside of Township

Indiana Code § 36-6-6-14 authorizes a township to borrow money if it finds there is “a need for fire and emergency services or other emergency requiring the expenditure of money not included in [its] budget estimates and levy.” See IND. CODE § 36-6-6-14(a),(b) (2009). The Petitioners explain that to determine whether a fire and emergency services need exists, Indiana Code § 36-6-6-14 requires that a township
board and any other reviewing authority consider eight factors that the Petitioners refer to as the “needs analysis.”  (See Oral Argument Tr. at 31-32.) On appeal, the Petitioners assert that because the DLGF’s final determination cites the Tax Court’s Perry decision alone, the DLGF must have failed to consider the eight factors set forth in Indiana Code § 36-6-6-14(d), and therefore, the DLGF’s final determination is
contrary to law. (See Oral Argument Tr. at 31-32; Petrs’ Br. at 21-26.)

Indiana Code § 36-6-6-14 authorizes a township to borrow money for “nonbudgeted” emergency items. See I.C. § 36-6-6-14. Here, however, the Gregg Township Board’s loan resolution sought to borrow money pursuant to its authority to make a capital purchase under an entirely different statutory scheme, Indiana Code § 36-8-13. (See Cert. Admin. R. at 20.) Indeed, Indiana Code § 36-8-13-3 authorizes a
township to

[p]urchase firefighting and emergency services apparatus and equipment for the township, provide for the housing, care, maintenance, operation, and use of the apparatus and equipment to provide services within the
township . . . and employ full-time or part-time personnel to operate the apparatus and equipment to provide services in that area.

IND. CODE § 36-8-13-3(a)(1) (2009). See also IND. CODE §§ 36-8-13-5, -6 (2009) (explaining that a township may either make an appropriation from its budget or borrow money from a financial institution to make the purchase). Neither Indiana Code § 36-8-13 nor Indiana Code § 36-6-6-14(d) indicate that they are somehow interdependent.

Accordingly, the DLGF was not required to perform the “needs analysis” set forth in Indiana Code § 36-6-6-14(d) before it approved the Gregg Township Board’s loan resolution under Indiana Code § 36-8-13. Therefore, the Court is not persuaded by the Petitioners’ first claim that the DLGF’s final determination is contrary to law.

II.

Next, the Petitioners argue that the DLGF’s final determination is not supported by substantial evidence. For example, they assert that in approving the Gregg Township Board’s loan resolution, the DLGF improperly afforded Fire Chief Hayes’s testimony too much weight because as an employee of the fire department, his interests are aligned with those of the fire department and not with those of the Township. (Oral Argument Tr. at 13-16; Petrs’ Br. at 14-19 (claiming that Hayes’s testimony merely went to why the fire department wanted a new vehicle, not why the Township needed it).)

The Petitioners also explain that the Township’s evidence is conclusory, claiming for example that if the current vehicle had in fact been in various accidents, the Township should have presented the DLGF with “pictures evidencing damage[ as well as] invoices for [the vehicle’s] repair[.]”  (Petrs’ Br. at 16 (footnote added).) Accordingly, the Petitioners maintain that the Township’s evidence demonstrates nothing more than Fire Chief Larry Hayes’s desire to have a new toy. (See Cert. Admin. R. at 534, 591.)

The Court will find that the DLGF’s final determination is not supported by substantial evidence if it determines that a reasonable person, upon reviewing the administrative record in its entirety, could not find enough relevant evidence to support the Township’s loan resolution decision. See Amax Inc. v. State Bd. of Tax Comm’rs, 552 N.E.2d 850, 852 (Ind. Tax Ct. 1990). In making that determination, the Court
cannot reweigh the evidence contained in the administrative record nor can it judge the credibility of the witnesses who testified at the administrative hearing. See Freudenberg-NOK Gen. P’ship v. State Bd. of Tax Comm’rs, 715 N.E.2d 1026, 1030 (Ind. Tax Ct. 1999) (citations omitted), review denied. Here, however, the Petitioners have invited the Court to do exactly that: they invite the Court to reweigh the evidence, to judge the credibility of the Township’s witnesses, or to hold that the Township should
have presented some other evidence for the DLGF to consider. (See, e.g., Petrs’ Br. at 20 (requesting that the Court give no weight to the Township’s evidence).) These invitations are not within the Court’s prerogative. See Freudenberg-NOK Gen. P’ship, 715 N.E.2d at 1030. Accordingly, the Court is not persuaded that the DLGF’s final determination is not supported by the evidence. See Clark-Pleasant Cmty. Sch. Corp., 899 N.E.2d at 765 (citations omitted) (explaining that the Court will give deference to any reason the DLGF bases its final determination on as long as that reason is supported by substantial evidence).

III.

Finally, the Petitioners claim that the DLGF’s final determination wrongly requires the taxpayers of Gregg Township to bear the entire cost of the loan even though the fire department will use the new vehicle to respond to calls outside Gregg Township. (Petrs’ Br. at 27-32.) Thus, allege the Petitioners, the DLGF’s final determination violates both Article 1, Section 23 and Article 10, Section 1 of the Indiana Constitution.

While the Petitioners raised this argument at the administrative hearing, the DLGF failed to address it in its final determination. (Cf. Cert. Admin. R. at 528-30, 533, 536 with Cert. Admin. R. at 11.) In reviewing the administrative record, the Court notes that the parties presented competing evidence with respect to this issue. Accordingly, the Court remands this issue to the DLGF so that it may fulfill its duty to review the
evidence, weigh it, and make a determination thereon.

http://www.in.gov/judiciary/opinions/pdf/05241301mbw.pdf