Williams Industries v. State Bd. of Tax Com'rs

• Decision Date: 30 March 1995
• Docket Number: No. 49T10-9206-TA-00041,49T10-9206-TA-00041
• Citation: 648 N.E.2d 713
• Parties: WILLIAMS INDUSTRIES, Petitioner, v. STATE BOARD OF TAX COMMISSIONERS, and Jennifer Maher, Hearing Officer for the State Board of Tax Commissioners, Respondents.
• Court: Indiana Tax Court

Page 713

648 N.E.2d 713

WILLIAMS INDUSTRIES, Petitioner, v. STATE BOARD OF TAX COMMISSIONERS, and Jennifer Maher Hearing Officer for the State Board of Tax Commissioners, Respondents.

No. 49T10-9206-TA-00041.

Tax Court of Indiana.

March 30, 1995.

Curtis J. Dickinson, Dickinson & Associates, Indianapolis, Jeffrey S. Bate, Bate, Harrold & Meltzer, Shelbyville, for petitioner.

Pamela Carter, Atty. Gen., Marilyn S. Meighen, Deputy Atty. Gen., Indianapolis, for respondents.

FISHER, Judge.

Williams Industries (Williams) appeals a final determination of the State Board of Tax Commissioners (the State Board), assessing Williams's real property for the March 1, 1991, assessment. The sole issue for the court's review is whether the State Board abused its discretion in refusing to grant Williams's Form 130/131 Petitions for Review of Assessment.

FACTS AND PROCEDURAL HISTORY

Williams owns two parcels of commercial property in Whitley County, Indiana (parcel 1 and parcel 2). After the 1989 general reassessment, Williams received a Form 11 Notice of Assessment for each parcel. Petitioner's Exhibits 1 and 2. In March 1992, Williams received a tax bill on each parcel for tax year 1991. The tax bills indicated that each parcel's 1989 general reassessment values had been carried forward to 1991. ¹

On April 22, 1992, Williams, by its attorney-in-fact, Landmark Appraisals, filed two Form 130 Petitions for Review of Assessment with the Whitley County Auditor (Auditor), contending that the 1991 tax bills were too high. More specifically, Williams maintained that, in 1991, its property was entitled to a deduction for a "kit" building as well as an obsolescence adjustment. Consequently, Williams further maintained that its 1989 general reassessment values no longer reflected the parcels' proper values and, therefore, the 1989 general reassessment values should not have been carried forward to 1991.

In a letter dated April 22, 1992, the Auditor rejected Williams's Forms 130, explaining that since Williams had failed to file its Forms 130 within the statutorily prescribed period, the Form 130/131 method of review was no longer available. See Stipulation of Facts (filed March 3, 1993) at 2. The Auditor did, however, inform Williams that it could still seek review of its 1991 assessment by filing two Forms 134 Petition for Reassessment with the State Board. The Auditor included two Form 134 petitions and instructions for filing them in her letter to Williams.

Notwithstanding the Auditor's instruction to file two Forms 134, Williams filed a Form 131 Petition for Review of Assessment for each parcel with the Auditor on April 29, 1992, to be forwarded to the State Board. In a letter dated May 8, 1992, State Board hearing officer Jennifer Maher rejected Williams's Forms 131, stating:

The # 131 petitions in question were not able to be filed due to the fact the taxpayer had received Form 11s at the time of the last reassessment in 1989. The taxpayer had also paid taxes since that time and there have been no changes made to the building to warrant a new Form 11. The only time the tax bill can be used as a notice is if a Form 11 had not been sent at reassessment time and if they had made any changes and a Form 11 had not been sent at the appropriate time....

Stipulation of Facts at 3.

Williams now appeals to this court. Additional facts will be supplied as necessary.

STANDARD OF REVIEW

The State Board is accorded great deference when it acts within the scope of its authority. Mahan v. State Bd. of Tax Comm'rs (1993), Ind. Tax, 622 N.E.2d 1058, 1061. Thus, "the court will reverse the State Board's final determination only when it is unsupported by substantial evidence, constitutes an abuse of discretion, exceeds statutory authority, or is arbitrary or capricious." Id.

DISCUSSION AND ANALYSIS

In 1989, a general reassessment of all the property in Indiana took effect. IND. CODE 6-1.1-4-4(a) (prior to amendment by P.L. 332-1989, § 3). The next general reassessment will take effect in 1995. Id. (as amended by P.L. 332-1989, § 3). Thus, the property values assigned in the 1989 general reassessment are carried forward from year to year until the next general reassessment takes effect. See id. Nevertheless, assessing officials may assess or reassess real property between general reassessments. IND. CODE 6-1.1-4-30. Interim assessments are made to reflect changes to the property which may increase or decrease its general reassessment value. See IND. CODE 6-1.1-4-25.

A taxpayer must receive notice ² of her property's value in both the year a general reassessment takes effect, as well as in any year in which an interim assessment is made. IND. CODE 6-1.1-4-22. This notice serves to "trigger" a taxpayer's right to challenge the reassessment or assessment if she believes it to be erroneous. See I.C. 6-1.1-15-1. If, however, a taxpayer does not receive notice for a year in which a general reassessment takes effect or in which an interim assessment is made, her annual tax bill constitutes The issue in dispute today is what methods of relief are available to a taxpayer wishing to challenge an unchanged assessment in a non-general reassessment year. Williams contends that a taxpayer may pursue Form 130/131 relief in a non-general reassessment year upon receipt of either a Form 11 or a tax bill. Williams explains that it pursued the Form 130/131 relief upon receipt of its tax bill for alternative reasons:

notice for the purposes of triggering her right to challenge her assessment. IND. CODE 6-1.1-15-13. When no changes occur to the property to affect its general reassessment value, the general reassessment values are merely carried over. As a result, the taxpayer receives a tax bill only, which indicates the net value of the property and the amount of tax due.

First ... Williams'[s] real property was assessed [in 1991] ... and thus, Williams was entitled to official notice which it never received. Alternatively, Williams was not reassessed when it should have been, and the first notice of the assessor's failure to perform a timely reassessment of the property was upon Williams'[s] receipt of its annual tax bill. For either reason, Williams is entitled to Form 130/131 review because notice was required and not sent, and because the Form 130/131 review was filed within 30 days of Williams'[s] receipt of its tax bill.

Petitioner's Post-Trial Brief at 2. The court will now address each of Williams's reasons in turn.

A. WILLIAMS'S PROPERTY WAS "ASSESSED" IN 1991.

Williams maintains that "[t]he assessor actually assessed Williams'[s] real property [in 1991] in order to determine that changes in the existing assessment should not be made; therefore, [Form 11] notice was required." Petitioner's Post-Trial Brief at 6. Furthermore, Williams contends that because local assessors have the duty to keep assessments current under I.C. 6-1.1-4-25, the Whitley County Assessor neglected her duty when she did not make adjustments for changes that occurred in the property in 1991, merely carrying the 1989 general reassessment values forward to 1991. Transcript at 18.

First, Williams confuses the actual valuing of property with the ministerial functions of maintaining real property record cards, tax rolls, abstracts, and issuing annual tax bills. Indeed, Williams's property was not "assessed" in 1991 in the sense that the property was visually inspected as it was in 1989. Consequently, no new value was assigned to Williams's property for 1991. In 1992, Williams received a tax bill for the 1991 "assessment" which merely indicated the property's 1989 "assessed" value.

Second, while local assessors are duty bound to keep assessments current, I.C. 6-1.1-4-25, they are not bestowed with omniscient powers. Accordingly, assessors cannot intuitively know every property change that occurs within their jurisdiction in any given year. Assessors must therefore rely, in part, on property owners to keep abreast of changes occurring to the owners' respective properties. Indeed, assessors will typically make interim assessments upon the filing of building permits, or petitions for review, by the property owners. See Transcript at 59.

In the context of personal property assessment, our Supreme Court has previously stated: "[i]t is utterly unrealistic to expect every tax assessor to be on the premises of every taxpayer on precisely the first day of March every year to make an independent determination of what taxable property is on the premises at that specific time." South Shore Marina, Inc. v. State Bd. of Tax Comm'rs (1989), Ind., 543 N.E.2d 644, 645. Likewise, this court holds that it is just as unrealistic to expect assessors to intuitively know of every change on every parcel of real property in every year between general reassessments.

B. METHODS OF REVIEW

Prior to January 1, 1994, a taxpayer wishing to challenge her property's value had three methods available to her: 1) the Form 130/131 Petitions for Review of Assessment method; 2) the Form 134 Petition for Reassessment method; and 3) the Form 133 Petition "Because actions requiring notice do not occur every year, the Form 130/131 review process is not automatically applicable to every year." Id. at 760. Consequently, the second method of relief a taxpayer could pursue was to file a Form 134 petition with the State Board "on or before March 31st of any year which [wa]s not a year in which a general reassessment of real property bec[a]me[ ] effective." Id.; I.C. 6-1.1-4-7 (repealed, P.L. 41-1993, § 54). Like the Form 130/131 petitions, the Form 134 offered relief for both objective and subjective errors. Id.; Reams, 620 N.E.2d at 760. The relief provided by Form 134, however, was prospective only. Id.; see also I.C. 6-1.1-4-7 (repealed, P.L. 41-1993, § 54). In effect then, the Form 134 enabled the taxpayer to notify the assessor that a property change had occurred, and therefore the general reassessment should...