Developers Diversified Ltd. v. Cuyahoga Cty. Bd. of Revision, 97-2329

• Decision Date: 02 December 1998
• Docket Number: No. 97-2329,97-2329
• Citation: 701 N.E.2d 975,84 Ohio St.3d 32
• Parties: DEVELOPERS DIVERSIFIED LTD. et al., Appellees, v. CUYAHOGA COUNTY BOARD OF REVISION et al., Appellees; North Olmsted Board of Education, Appellant.
• Court: Ohio Supreme Court

Page 32

84 Ohio St.3d 32

701 N.E.2d 975

DEVELOPERS DIVERSIFIED LTD. et al., Appellees, v. CUYAHOGA COUNTY BOARD OF REVISION et al., Appellees; North Olmsted Board of Education, Appellant.

No. 97-2329.

Supreme Court of Ohio.

Submitted Oct. 13, 1998.

Decided Dec. 2, 1998.

In 1987, Developers Diversified Ltd. et al. (collectively, "Developers Diversified") owned five of seven parcels of approximately forty-three acres of vacant land at the I-480 interchange with Columbia Road in North Olmsted. The land was zoned "single-family residential." Developers Diversified sued North Olmsted seeking to rezone the entire property so that Developers Diversified could develop an executive office park and hotel complex on it.

The North Olmsted Board of Education ("BOE"), appellant, and appellee North Olmsted, in 1989, filed a complaint with the appellee Cuyahoga County Board of Revision ("BOR"), challenging appellee Cuyahoga County Auditor's value for parcels it owned for tax year 1988. The year 1988 was the first year of a three-year interim period in Cuyahoga County spanning the years 1988, 1989, and 1990. The BOR decided the tax year 1988 complaint on March 14, 1990, finding an increase in assessed value.

On November 28, 1988, Developers Diversified settled its rezoning suit against North Olmsted. The parties agreed that North Olmsted would rezone the property and that Developers Diversified could develop offices, multifamily housing, and hotels on it. This rezoning made the property more valuable.

For the tax year 1990, the BOE and North Olmsted filed complaints challenging the values placed on the entire property, including the two additional parcels Developers Diversified had purchased since 1987. Developers Diversified moved to dismiss the 1990 complaints, but the BOR denied the motion because the complaints on these parcels for tax years 1988 and 1990, filed for the same interim period, were not the same. The BOR then determined that rezoning and conditions of the property resulted in a substantial change in its fair market value. The BOR, consequently, as to each parcel, increased the value of the land. Developers Diversified appealed the BOR's decisions to the Board of Tax Appeals ("BTA").

Developers Diversified again filed a motion to dismiss the complaints with the BTA, arguing that the complaints were second complaints for the same interim period in violation of R.C. 5715.19. The BTA, however, conducted a full evidentiary hearing on the valuation question; nonetheless, the BTA dismissed the complaints as to the parcels listed in the tax year 1988 complaint. The BTA ruled that an improvement to real property, one of the exceptions permitting a complainant to file more than one complaint for an interim period, must be "a physical change to or located on the real property." A rezoning, according to the BTA, was not such a change.

The BTA did increase the value of the two parcels that were not part of the tax year 1988 complaint. The values of these parcels are not at issue.

This cause is now before the court upon an appeal as of right.

Fred Siegel Co., L.P.A., Columbus, and Annrita S. Johnson, Cleveland, for appellees Developers Diversified Ltd. et al.

Stephanie Tubbs Jones, Cuyahoga County Prosecuting Attorney, and Timothy J. Kollin, Assistant Prosecuting Attorney, for appellees Cuyahoga County Board of Revision and Cuyahoga County Auditor.

Kolick & Kondzer, Thomas A. Kondzer and Rita M. Jarrett, Westlake, for appellant.

ALICE ROBIE RESNICK, Justice.

R.C. 5715.19(A)(2) provides:

"As used in division (A)(2) of this section, 'interim period' means, for each county, the tax year to which section 5715.24 of the Revised Code applies and each subsequent tax year until the tax year in which that section applies again.

"No person, board, or officer shall file a complaint against the valuation or assessment of any parcel that appears on the tax list if it filed a complaint against the valuation or assessment of that parcel for any prior tax year in the same interim period, unless the person, board, or officer alleges that the valuation or assessment should be changed due to one or more of the following circumstances that occurred after the tax lien date for the tax year for which the prior complaint was filed and that the circumstances were not taken into consideration with respect to the prior complaint:

" * * *

"(c) Substantial improvement was added to the property[.]"

The BOE first argues that it may file a second complaint for the same interim period because Developers Diversified added parcels to the property considered in the first complaint, thus forming a new economic unit. The BOE cites for support Park Ridge Co. v. Franklin Cty. Bd. of Revision (1987), 29 Ohio St.3d 12, 29 OBR 231, 504 N.E.2d 1116, in which this court held, at paragraph two of the syllabus:

"The true value for real property may well depend on its potential use as an economic unit. That unit may include multiple parcels, or it may be part of a larger parcel, on the auditor's records. The boundaries of that unit may change with time and circumstances. Thus, a separate tract for valuation purposes need not correspond with a numbered parcel. For tax valuation purposes, property with a single owner, for which the highest and best use is a single unit, constitutes a tract, lot, or parcel."

Park Ridge does not support the BOE's claim. In Park Ridge, the county auditor had assigned a separate permanent parcel number to each of thirty-four duplex units on separate city lots in Grove City and to thirty-five duplex units in Columbus. The trial court valued each rental complex as a separate unit, but the auditor and school boards argued...