1979 Valuation of Parcel No. R2348750330 of Crow, Matter of

• Decision Date: 20 April 1983
• Docket Number: No. 13990,13990
• Citation: 662 P.2d 1125,104 Idaho 681
• Parties: In the Matter of the 1979 VALUATION OF PARCEL NO. R2348750330 OF Stanley D. CROW and Donna F. Crow, Appellants. In the Matter of the Appeal of Stanley D. CROW and Donna F. Crow from the Board of Equalization of Ada County for the Tax Year 1979. Stanley D. CROW and Donna F. Crow, Appellants, v. The BOARD OF EQUALIZATION and the Board of Ada County Commissioners, Respondents.
• Court: Idaho Supreme Court

Page 1125

662 P.2d 1125

104 Idaho 681

In the Matter of the 1979 VALUATION OF PARCEL NO. R2348750330 OF Stanley D. CROW and Donna F. Crow, Appellants.

In the Matter of the Appeal of Stanley D. CROW and Donna F. Crow from the Board of Equalization of Ada County for the Tax Year 1979.

Stanley D. CROW and Donna F. Crow, Appellants, v. The BOARD OF EQUALIZATION and the Board of Ada County Commissioners, Respondents.

No. 13990.

Supreme Court of Idaho.

April 20, 1983.

Stanley Crow, Boise, for appellants.

Greg H. Bower, Scott L. Campbell and David W. Ball (argued), Boise, for respondents.

BISTLINE, Judge.

This is an appeal from a judgment in two matters which were consolidated in the district court, upon appeals by the appellants herein, Stanley and Donna Crow (hereinafter "Taxpayers"), to the district court from the Board of Ada County Commissioners and the Board of Equalization of Ada County. The basic facts in this case are as follows.

The Taxpayers are individuals, husband and wife, who are residents of Ada County. The property in question is improved real estate upon which the Taxpayers' home is located.

The Ada County Assessor assessed the entire property, both house and land, for the year 1978 at a market value for assessment The proceedings in this matter began on June 26, 1979, when the Taxpayers timely filed a written protest of the 1979 assessment of their property with the Board of Ada County Commissioners, sitting as a board of equalization, requesting that the market value of their property for assessment purposes be lowered to $60,000. A similar request was made by the Taxpayers in a July 5, 1979, petition to the Board of Ada County Commissioners. Both the protest and the petition were based upon the then applicable version of I.C. § 63-923(2), ² which the Taxpayers contend limits the market value of the property for assessment purposes for the 1979 year to the 1978 market value for assessment purposes, with an adjustment for inflation limited to two percent. On July 5, 1979, the Board of Ada County Commissioners, sitting as a board of equalization, denied the Taxpayers' protest, and on July 16, 1979, the Board of Ada County Commissioners denied the Taxpayers' petition.

                [104 Idaho 682]  purposes of $60,000.  At the time the property was appraised for the year 1978, the Taxpayers' home was under construction;  the $60,000 valuation was an appraisal which took into account the fact that the Taxpayers' home was at that time a partially completed structure. 1  Construction of the home was completed during 1978.  Thereafter, the Ada County Assessor assessed the property for the 1979 tax year at a market value for assessment purposes of $163,300, including $12,000 for the land and $151,300 for the Taxpayers' home
                

The Taxpayers appealed the Commissioners' July 16 denial of their petition to the district court, and at the same time the Taxpayers appealed to the Idaho Board of Tax Appeals from the July 5 denial of their protest. The Board of Tax Appeals affirmed the denial of the protest, and the Taxpayers appealed that decision to the district court. Thereafter, the two cases were consolidated in the district court.

On January 24, 1980, the parties through counsel entered into a stipulation of facts. Based on that stipulation, the parties cross-moved for summary judgment. On May 15, 1980, the district court granted Ada County's motion, and affirmed the determinations of the Idaho Board of Tax Appeals and the Ada County Commissioners.

On June 4, 1980, the Taxpayers offered to prove certain facts regarding rules and regulations of the Idaho State Tax Commission. That offer of proof was effectively replaced by a volume of rules and regulations which was later submitted by stipulation to the district court and constituted all of the rules and regulations that were possibly material to this action. Upon the Taxpayers' motion, the district court ordered a rehearing, limited to the question of what impact, if any, certain rules and regulations of the Tax Commission would have on the court's decision. On November 6, 1980, the district court reaffirmed its May 14, 1980, decision denying the Taxpayers relief. A notice of appeal was thereafter timely filed.

The primary issue before this Court is whether, under the applicable version of I.C. § 63-923(2), the Ada County Assessor was precluded from reappraising the Taxpayers' property in 1979. We hold that I.C I.C. § 63-923 began as a 1979 codification by the legislature of Initiative Petition No. 1, as adopted by the electorate at the general election of November 7, 1978. Section 2 of Petition No. 1 provided:

                §   63-923(2) did not preclude reappraisal of the Taxpayers' property and, therefore, affirm the decision of the district court upholding the legality of Ada County's assessment for the 1979 tax year
                

"1. The actual market value shall be determined by the County Assessor but where real property is concerned it shall be the actual use of the real property. The actual market value means the County Assessors valuation of property subject to taxation as shown on the 1978 tax Assessment under 'market value', or thereafter, the appraised value of property subject to taxation when purchased, newly constructed, or a change in ownership has occurred after the 1978 assessment. All taxable property which has not already been assessed up to the 1978 levels may be reassessed to reflect that valuation.

"2. The actual market value base may reflect from year to year the inflationary rate not to exceed two percent (2%) for any given year or reduction as shown in the consumer price index or comparable data for the area under taxing jurisdiction."

Before Initiative Petition No. 1 was adopted it was reviewed by Idaho Attorney General Wayne L. Kidwell, who issued Opinion No. 78-37, concluding that Section 2 of the initiative discriminated in an unconstitutional manner, "because a parcel of property which had been purchased, newly constructed or subjected to a change in ownership will be placed on the tax rolls at a value higher than that of a similar parcel which has not experienced one of these circumstances." The Attorney General offered the following recommendation:

"The only sensible and certain safeguard is that of deleting the distinction made in Section Two of the initiative between property purchased, newly constructed or subjected to change of ownership on the one hand and property which has not experienced any of these circumstances on the other hand." ³

The legislature codified section 2 of the initiative as I.C. § 63-923(2), with the changes as shown:

" (2)(a) The market value for assessment purposes of real and personal property subject to appraisal by the county assessor shall be determined by the county asseSsor according to the rules and regulations prescribed by the state tax commission, as provided in section 63-202, Idaho Code, but where real property is concerned it shall be the actual and functional use of the real property. All taxable property which has not been appraised at 1978 market value levels shall be reappraised or indexed to reflect that valuation for the tax year commencing January 1, 1980. All property placed on the assessment roll for the first time after 1978, and all property which is reappraised after 1978, shall be appraised or indexed to reflect 1978 market value levels.

" (b) The 1978 market values for assessment purposes of real and personal property shall be adjusted from year to year to reflect the inflationary rate but at a rate not to exceed two percent (2%) for any given year as shown in the consumer price index or comparable data for the area under taxing jurisdiction." 1979 Idaho Sess.Laws ch. 18, § 1 p. 24 (New material. .).

The changes shown above were made effective retroactively to January 1, 1979. Thus, I.C. § 63-923(2), as set forth above, was the version applicable to the 1979 tax year and the version which determines the propriety of the Ada County Assessor's 1979 reappraisal of the Taxpayers' property.

The Taxpayers argue that I.C. § 63-923(2) precluded reappraisal in 1979 of property that had been appraised in 1978. They assume that the two percent limitation in I.C. § 63-923(2)(b) "prevented re-appraisals (beyond the two percent (2%) adjustment) of property which increased in value for reasons such as zoning changes, location, nearby development, etc.," and argue that the legislature's deletion of the language expressly referring to appraisal of property which had been newly constructed or which had experienced a change of ownership, ⁴ demonstrates that the legislature intended to preclude reappraisal in such cases also. Thus, the Taxpayers ask this Court to conclude that their property was incorrectly assessed in 1979 by Ada County at a market value for assessment purposes of $163,300; they contend that the 1979 market value of their property for assessment purposes should have been determined to be the 1978 market value for assessment purposes of $60,000, plus two percent thereof, for a total of not more than $61,200.

We cannot accept the interpretation of I.C. § 63-923(2) offered by the Taxpayers. It is not supported by the language of the statute, it is contrary to the statutes and regulations governing ad valorem taxation, and it would result in the statute being unconstitutional.

I.C. § 63-923(2) provided in part:

"All taxable property which has not been appraised at 1978 market value levels shall be reappraised or indexed to reflect that valuation for the tax year commencing January 1, 1980. All property placed on the assessment roll for the first time after 1978, and all property which is reappraised after 1978, shall be appraised or indexed to reflect 1978 market value levels." (Emphasis added.)

The plain language of I.C. § 63-923(2) clearly demonstrates that the legislature did not intend to preclude reappraisals. Furthermore, we believe that the legislature's references in I.C. §...