Petrin v. Town of Scarborough
| Decision Date | 16 February 2015 |
| Docket Number | Docket No. BCD-AP-14-03 |
| Parties | DONALD PETRIN, et al. Plaintiffs-Appellants v. THE TOWN OF SCARBOROUGH Defendant-Appellee. |
| Court | Maine Superior Court |
Cumberland, ss.
This is an appeal, pursuant to Rule 80B of the Maine Rules of Civil Procedure, from a decision of the Town of Scarborough's Board of Assessment Review, denying the Appellants' requests for tax abatement on their properties. The Appellants in their brief advance three distinct grounds on which the Board's denial of their abatement requests should be reversed:
Based on these arguments, the Appellants contend that the 2012 assessments of their properties were manifestly wrong, and that the Board's denial of their abatement requests should be reversed.
Appellant taxpayers own properties on or near the Atlantic Ocean in the Higgins Beach, Pine Point, and Pillsbury Shores neighborhoods of Scarborough.
The Town of Scarborough Assessor last conducted a town-wide valuation of residential property in 2005. In 2012, after analyzing sales data for the period after the town-wide valuation, Assessor Paul Lesperance (who has since retired) undertook a partial revaluation of Town residential properties, focusing on specific neighborhoods on or near the ocean, and omitting interior neighborhoods.
As a result of the partial revaluation, the Assessor increased the assessed value of the residential properties in the targeted neighborhoods, including the properties owned by the Appellants. (R. 307.) The assessed value of properties in other Scarborough neighborhoods remained the same. Id. The overall result of the 2012 partial valuation is that water-influenced property1 in Scarborough bears a higher proportion of the Town property tax burden than it did before the partial revaluation.
The Appellants appealed their increased assessments to the Board of Assessment Review (the "Board"), which consolidated the appeals, held hearings, and unanimously denied the appeals on December 18, 2013. (R. 309.)
In a Rule 80B appeal, the Superior Court reviews findings made by the municipal decision maker to determine whether those findings were based upon an "erroneous interpretation of the law" or based upon conclusions of fact not "supported by substantial evidence on the record as a whole." Bruk v. Town of Georgetown, 436 A.2d 894, 897 (Me. 1981). "Substantial evidence is 'evidence that a reasonable mind would accept as sufficient to support a conclusion.'" York v. Town of Ogunquit, 2001 ME 53, ¶ 6, 769 A.2d 172 (quoting Sproul v.Town of Boothbay Harbor, 2000 ME 30, ¶ 6, 746 A.2d 368). The court must affirm the decision of the [Board] unless that decision was unlawful, arbitrary, capricious, or unreasonable." Driscoll v. Gheewalla, 441 A.2d 1025, 1026 (Me. 1982). Procedural unfairness is reversible error and a "decision can be 'arbitrary and capricious' if it was not the product of the requisite processes." Hopkins v. Dep't of Human Servs., 2002 ME 129, ¶ 12, 802 A.2d 999 (citations omitted). "That the record contains evidence inconsistent with the result, or that inconsistent conclusions could be drawn from the evidence, does not render the [Board's] findings invalid if a reasonable mind might accept the relevant evidence as adequate to support the [Board's] conclusion." Town of Vienna v. Kokernak, 612 A.2d 870, 872 (Me. 1992). The party seeking to overturn the decision bears the burden of persuasion on appeal. Town of Sw. Harbor v. Harwood, 2000 ME 213, ¶ 6, 763 A.2d 115, 117 (citing Sawyer Envtl. Recovery Facilities, Inc. v. Town of Hampden, 2000 ME 179, ¶ 13 760 A.2d 257).
The court presumes tax assessments are valid. Ram's Head Partners, LLC v. Town of Cape Elizabeth, 2003 ME 131, ¶ 9, 834 A.2d 916. "A taxpayer who seeks a tax abatement must prove that the assessed valuation is 'manifestly wrong.'" Terfloth v. Town of Scarborough, 2014 ME 57, ¶ 12, 90 A.3d 1131. A taxpayer can prove an assessment is manifestly wrong by showing:
Tusem v. Town of Raymond, 2001 ME 61, ¶ 9, 769 A.2d 865. To prevail on a claim of unjust discrimination, taxpayers must demonstrate "that the assessor's system necessarily results inunequal apportionment." Ram's Head, 2003 ME 131, ¶ 10, 834 A.2d 916 (quoting City of Biddeford v. Adams, 1999 ME 49, ¶ 14, 727 A.2d 346). Because the Board concluded that the Appellants failed to meet their burden of proof, this court will vacate the Board's decision denying tax abatement "only if the record compels a contrary conclusion to the exclusion of any other inference." Terfloth, 2014 ME 57, ¶ 13, 90 A.3d 1131.
The legal backdrop for the analysis was summarized by the Law Court in Weekley v. Town of Scarborough:
The Maine Constitution requires that "[a]ll taxes upon real and personal estate, assessed by authority of this State, shall be apportioned and assessed equally according to the just value thereof." Me. Const. art. IX, § 8. "Just value" means market value. Alfred J. Sweet, Inc. v. City of Auburn, 134 Me. 28, 31, 180 A. 803 (1935). "The sale price of property is evidence of market value, which is used in determining property value for tax assessment purposes." Wesson v. Town of Bremen, 667 A.2d 596, 599 n. 5 (Me. 1995). See also Shawmut Inn v. Town of Kennebunkport, 428 A.2d 384, 394-95 (Me. 1981) (); Arnold v. Maine State Highway Comm'n, 283 A.2d 655, 658 (Me. 1971) () (citation omitted).
By statute, municipalities are required to maintain property assessments within a range of assessment ratios (ratio of assessed value to market value)—a minimum of 70% and a maximum of 110%. See 36 M.R.S. § 327(1). Thus, ongoing review and adjustment of assessments are necessary to assure that appropriate assessment ratios and, ultimately, equal apportionment of the overall tax burden, are maintained.
The Law Court has noted that, although "[t]ownwide revaluations are perhaps the best method of maintaining equal apportionment of the tax burden . . . assessors are not precluded from undertaking adjustments designed to maintain equal distribution of the tax burden in the time period between townwide revaluations." Moser v. Town of Phippsburg, 553 A.2d 1249, 1250(Me. 1989).2 In Moser, the Law Court held that such partial revaluations are an acceptable means of maintaining an equal distribution of the tax burden. Id.
The first of the three grounds advanced by the Appellants focuses on the method by which Town conducted the partial revaluation that resulted in the increased assessments of Appellants' properties.
In this case, the Appellants' parcels are located in three discrete neighborhoods within the Town of Scarborough: the Higgins Beach shorefront, the Pine Point shorefront, and the interior part of the subdivision known as Pillsbury Shores. (R. 307.) The last townwide revaluation in Scarborough took place in 2005. (R. 1259-60.) The objective of the 2005 revaluation was to assess all taxable real properties in the Town at or as close as possible to 100% of their market value. Id.
As did the municipality in Moser, the Town of Scarborough has monitored property sales each year and, based on its analysis of qualifying sales, made upward or downward adjustments in the assessment of specific properties. The purpose of such partial revaluations is to maintain assessments in line with the Town's overall ratio verified by Maine Revenue Services during the agency's annual audit.
In determining the 2012 land assessments, the Town assessor at the time, Paul Lesperance3 ("Mr. Lesperance" or the "Assessor"), determined that, though residential properties were following a sales ratio close to 100%, waterfront and water-influenced neighborhoods were tracking significantly lower at 70-80% ratios of assessed value to value on sale. (R. 1263.) Thus, in accordance with the Town's method of assessment mentioned above, Mr. Lesperance focused on the neighborhoods in which he determined that property assessments were at significant variance from the Town average. In total, Mr. Lesperance adjusted the land valuations of 754 parcels, including those owned by the Appellants.
The revaluation resulted in a 20% increase in assessed value for the Higgins Beach waterfront, a 25% increase for the Pine Point waterfront, and a 17% increase to the interior parcels in the Pillsbury Shores neighborhood. The Appellants argue that there was no evidence in the record before the Board that would allow it to conclude that these increases tended to equalize apportionment of the tax burden within the town. However, as noted previously, "assessors are not precluded from undertaking adjustments designed to maintain equal distribution of the tax burden in the time period between townwide revaluations." Moser, 553 A.2d at 1250. Rather, only a "rough equality" in tax treatment of similarly situated property...
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