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a. Indiana assesses real property
based on its true tax value, which for most property is “the market
value-in-use of a property for its current use, as reflected by the utility received
by the owner or a similar user, from the property.” 2002 REAL PROPERTY ASSESSMENT MANUAL at 2
(incorporated by reference at 50 IAC 2.3-1-2). Evidence in a tax appeal
generally must be consistent with that standard. For example, a market
value-in-use appraisal prepared according to Uniform Standards of Professional
Appraisal Practice (“USPAP”) often will be probative. See Kooshtard Property
VI, LLC v. White River Twp. Assessor, 836 N.E.2d 501, 506 n.6 (Ind. Tax Ct.
2005). Actual construction costs or sales information for the property under appeal,
sales or assessment information for comparable properties, and any other information
compiled according to generally acceptable appraisal principles may also be
probative.
b. The statutory and regulatory
scheme for assessing agricultural land, however, requires the Board to treat
challenges to those assessments differently than other assessment challenges.
For example, the legislature directed the Department of Local Government
Finance (“DLGF”) to promulgate guidelines for assessing agricultural land using
distinctive factors, such as soil productivity, that do not apply to other types
of land. I.C. § 6-1.1-4-13. The DLGF determines a statewide base rate for assessing
agricultural land by taking a rolling average of capitalized income from agricultural
land. See REAL
PROPERTY ASSESSMENT GUIDELINES FOR 2002 – VERSION A at 99-100; see
also I.C. § 6-1.1-4-4.5(e) (directing the DLGF to use a six-year, instead
of a four-year, rolling average). The base rate is then adjusted according to soil
productivity factors. And influence factors are applied in predetermined
amounts based on how the land is classified. For example, agricultural
woodlands, which the Guidelines define as “land supporting trees capable of
producing timber or other wood products” that “has 50% or more canopy cover or
is a permanently planted reforested area,” receives an 80% negative influence
factor. GUIDELINES, ch. 2 at 104,
115. By contrast, assessors are directed to determine influence factors for
other land types by estimating the effect of a property’s peculiar
characteristics on its market value-in-use. See GUIDELINES, ch. 2 at
56-58, 74, 89-90.
c. Thus, unlike appeals of other
types of property that focus on the types of market based evidence described in the Manual
rather than on how the Real Property Assessment Guidelines for 2002 –
Version A were applied, appeals challenging the assessment of agricultural land
are governed by the Guidelines.
d. Mr. Popejoy challenged both the assessment of his land, which includes 17.73 acres of agricultural land plus a one-acre homesite, and of his home. The Board will address the assessment of the agricultural land first. According to Mr. Popejoy, most of the land is unsuitable for crops. But he did not show that any particular section of the land was misclassified. Indeed, only 2.7 acres were assessed as tillable land for a total of $3,550. The remaining 15.03 acres were assessed as woodland. After applying the pre-determined negative 80% influence factor, the entire woodland area was assessed for only $3,330.
e. Mr. Popejoy’s real dispute
appears to be with the assessment of his home and the one acre homesite. In challenging that portion
of the assessment, he largely relies on the deterioration of the home. But as
Ms. Becker explained, the assessment already accounts for significant
deterioration. More importantly, Mr. Popejoy did not offer any probative
evidence to quantify the extent to which the deterioration affected the market
value-in-use or to show a value, or even a range of values, for the property.
f. Mr. Popejoy, however, did show
that his property was assessed for a barn that was no longer standing on March
1, 2010. The Board therefore finds that the 2010 assessment should be reduced
by $1,000—the value that the Assessor assigned to the barn.
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http://www.in.gov/ibtr/files/Popejoy_09-017-10-1-1-00013.pdf
