938 P.2d 1245 (Idaho 1997), 23018, Greenfield Village Apartments, L.P. v. Ada County

• Citation: 938 P.2d 1245, 130 Idaho 207
• Opinion Judge: SCHROEDER, Justice. McDEVITT,
• Party Name: GREENFIELD VILLAGE APARTMENTS, L.P., an Oregon limited partnership, Petitioner-Appellant, v. ADA COUNTY, Idaho; and Robert McQuade, Ada County Tax Assessor, Respondents.
• Attorney: Penland Munther Boardman, Chtd., Boise, for petitioner-appellant. Forrest R. Goodrum argued. Greg H. Bower, Ada County Prosecutor, Cary B. Colaianni, Deputy Prosecuting Attorney (argued), Boise, for respondents.
• Judge Panel: [130 Idaho 211] TROUT, C.J., and JOHNSON and SILAK, JJ., concur. McDEVITT, J., concurs in result.
• Case Date: June 12, 1997
• Court: Idaho Supreme Court

Page 1245

938 P.2d 1245 (Idaho 1997)

130 Idaho 207

GREENFIELD VILLAGE APARTMENTS, L.P., an Oregon limited partnership, Petitioner-Appellant,

v.

ADA COUNTY, Idaho; and Robert McQuade, Ada County Tax Assessor, Respondents.

No. 23018.

Supreme Court of Idaho, Boise.

June 12, 1997

Page 1246

[130 Idaho 208] Penland Munther Boardman, Chtd., Boise, for petitioner-appellant. Forrest R. Goodrum argued.

Greg H. Bower, Ada County Prosecutor, Cary B. Colaianni, Deputy Prosecuting Attorney (argued), Boise, for respondents.

SCHROEDER, Justice.

This is an appeal from a property tax assessment of an apartment complex owned by appellant Greenfield Village Apartments, L.P. (Greenfield), an Oregon limited partnership that is registered to do business in Idaho. Greenfield's apartment complex is a low-income rental housing project constructed under section 42 of the Internal Revenue Code. Greenfield entered into a Regulatory Agreement with the Idaho Housing Agency (Agreement). Under the Agreement, Greenfield is eligible for a low-income housing tax credit of $258,012, and the Agreement sets forth a restrictive covenant that binds Greenfield and all subsequent owners to restricted rent charges for twenty years.

I.

BACKGROUND

The Ada County Tax Assessor (Assessor) employed three market approaches in the appraisal of Greenfield's apartment complex for ad valorem tax purposes: (1) the "cost approach" which yielded a value of $3,148,610, (2) the "income approach" which yielded $3,201,120, and (3) the "sales comparison approach" which yielded $3,201,100. The Assessor assessed Greenfield's apartment complex as having a 1995 taxable value of $3,201,000, utilizing the "sales comparison approach." Greenfield filed a protest of valuation. Greenfield hired a private appraiser who appraised the property at $2,650,000, as an estimate of "the market value of the subject apartment complex, subject to the restrictive covenants imposed under the Regulatory Agreement." The Ada County Board of Equalization (Board) upheld the taxable value determined by the Assessor. Greenfield appealed to the district court pursuant to I.C. § 63-2210(3) (repealed 1997), requesting that the assessment of the apartment complex be reduced to $2,650,000 for the calendar year 1995. Greenfield further requested a mandatory injunction directing the Assessor to base future tax valuations on maximum rent chargeable for the apartment complex under the Agreement entered into by Greenfield and the Idaho Housing Agency, rather than relying upon hypothetical "market rate" rents. The district court affirmed the decision of the Board and upheld the Assessor's determination of taxable value for the 1995 tax year. Greenfield appealed to this Court.

Page 1247

II.

STANDARD OF REVIEW

On appeal, this Court reviews agency decisions independently of appellate decisions by the district court. Willig v. State Dep't of Health & Welfare, 127 Idaho 259, 261, 899 P.2d 969, 971 (1995); Boise Group Homes, Inc. v. Idaho Dep't of Health & Welfare, 123 Idaho 908, 909, 854 P.2d 251, 252 (1993); Dovel v. Dobson, 122 Idaho 59, 61, 831 P.2d 527, 529 (1992).

Judicial review is confined to the record, and the reviewing court does not substitute its judgment for that of the administrative agency on questions of fact. Boise Group Homes, 123 Idaho at 909, 854 P.2d at 252; Dovel, 122 Idaho at 61, 831 P.2d at 529; Morgan v. Idaho Dep't of Health & Welfare, 120 Idaho 6, 8-9, 813 P.2d 345, 347-48 (1991). The value of property for purposes of taxation determined by an assessor is presumed correct, and the burden of proof is on the taxpayer to show by clear and convincing evidence that the taxpayer is entitled to the relief claimed. Merris v. Ada County, 100 Idaho 59, 64, 593 P.2d 394, 399 (1979); Ada County v. Sears, Roebuck & Co., 74 Idaho 39, 46-47, 256 P.2d 526, 530 (1953). The Court will grant a taxpayer relief " 'where the valuation fixed by the assessor is manifestly excessive, fraudulent or oppressive; or arbitrary, capricious and erroneous resulting in discrimination against the taxpayer.' " Merris, 100 Idaho at 64, 593 P.2d at 399 (quoting Sears, Roebuck & Co., 74 Idaho at 46-47, 256 P.2d 526). The Court may reverse or modify if substantial rights of the parties have been prejudiced by administrative findings which violate constitutional or statutory provisions, are in excess of authority, are made upon unlawful procedure, or are clearly erroneous or arbitrary and capricious. Dovel, 122 Idaho at 61,...