Troy Realty Associates Inc. v. Board of Assessors of City of Troy

• Decision Date: 16 May 1996
• Citation: 642 N.Y.S.2d 734,227 A.D.2d 813
• Parties: In the Matter of TROY REALTY ASSOCIATES INC. et al., Respondents, v. BOARD OF ASSESSORS OF the CITY OF TROY et al., Appellants. (And Another Related Proceeding.)
• Court: New York Supreme Court — Appellate Division

Page 734

642 N.Y.S.2d 734

227 A.D.2d 813

In the Matter of TROY REALTY ASSOCIATES INC. et al., Respondents, v. BOARD OF ASSESSORS OF the CITY OF TROY et al., Appellants (And Another Related Proceeding.)

Supreme Court, Appellate Division Third Department.

May 16, 1996.

Thomas V. Kenney Jr., Troy, for appellants.

Certilman, Balin, Adler & Hyman (Dale Allinson, of counsel), East Meadow, for respondents.

Before CARDONA, P.J., and WHITE, CASEY, PETERS and SPAIN, JJ.

CARDONA, Presiding Justice.

Appeal from an order and judgment of the Supreme Court (Canfield, J.), entered July 20, 1995 in Rensselaer County, which granted petitioners' applications, in two proceedings pursuant to RPTL article 7, to reduce petitioners' real property tax assessments.

Petitioners are the owners of an apartment complex located in the City of Troy, Rensselaer County. They commenced the instant proceedings to challenge the tax assessment on the property for the 1992-1993 and 1993-1994 tax years. The property consists of approximately 5.33 acres of land with eight two-story apartment buildings containing a total of 124 apartment units. Respondents assessed the property in 1992 at $1,388,000 and in 1993 at $783,916. The proceedings were heard at a consolidated trial. It was stipulated that the equalization and assessment rate was 24.97% for 1992 and 24.08% for 1993. Thus, the only issue was whether respondents had overvalued the property.

Supreme Court rejected respondents' appraisal reports on the ground, inter alia, that they failed to comply with 22 NYCRR 202.59(g)(2) by not setting forth the "facts, figures and calculations by which the [reports'] conclusions were reached". The court accepted the facts and conclusions in petitioners' appraisal report and ordered that petitioners' assessment be reduced for 1992 to $568,068 and for 1993 to $541,800. Respondents appeal.

We affirm. Tax assessments are presumptively deemed valid and the burden is on the party challenging an assessment to establish that the property is overvalued (see, Matter of Welch Foods v. Town of Portland, 187 A.D.2d 948, 591 N.Y.S.2d 646; Matter of General Motors Corp. Cent. Foundry Div. v. Assessor of Town of Massena, 146 A.D.2d 851, 536 N.Y.S.2d 256, lv. denied 74 N.Y.2d 604, 543 N.Y.S.2d 397, 541 N.E.2d 426). While respondents do not take issue with Supreme Court's exclusion of their appraisal reports, they do contend that petitioners failed to overcome this presumption. We disagree. Based upon our review of the record, we are satisfied that petitioners presented sufficient evidence to make out a prima facie case that the assessment was erroneous so as to overcome the presumption of validity (see, Matter of Stonegate Family Holdings v. Board of Assessors of Town of Long Lake, 222 A.D.2d 997, 635 N.Y.S.2d 352; Matter of Broadway-Saranac Lake Corp. v. Board of Assessors of Saranac Lake, 43 A.D.2d 649, 349 N.Y.S.2d 830). The evidence also leads us to conclude that Supreme Court properly adopted and relied upon petitioners' appraisal report in lowering petitioners' assessment.

Petitioners' appraiser relied on the net income approach in determining the value of the property. In so doing, he compared the property's actual income with other comparable properties and concluded that the property was functioning "prudently and economically". He, therefore, adopted reported actual income as appraised income for the 1992 and 1993 tax years. Although actual income may be disregarded if it does not reflect market value (see, Matter of Merrick Holding Corp. v. Board of Assessors of County of Nassau, 45 N.Y.2d 538, 543, 410 N.Y.S.2d 565, 382 N.E.2d 1341), here, petitioners presented evidence that the actual rents were reflective of the market and we find no error in...