On May 12, 2015, the Indiana Tax Court ruled on the property tax appeals for two residential parcels owned by Property Development Company Four, LLC (the “Company”), which in 2003 bought two parcels in Grant County upon which two homes (the “Eastway Drive” and “Aspen Court” properties) were built. The Grant County Assessor failed to assess the new homes until 2006 and 2007, respectively, because he never received the building permits for the properties. The Assessor assessed both homes starting with the March 1, 2004, assessment date. The Treasurer, however, did not attempt to collect tax for these prior years’ assessments until 2010. On appeal, the Indiana Board of Tax Review nullified the 2004 assessment for the Aspen Court property due to an untimely notice but upheld the other assessments.
“Specific” assessment statute did not control. The Company argued that a more “specific” assessment statute, which applies to subdivision property assessments, trumped the Assessor’s use of the “general” assessment provision, Ind. Code § 6-1.1-9-4 (“Section 4”), to assess the homes. According to the Company, the specific provision applied only prospectively, so the Assessor was prohibited from retroactively increasing the properties’ values. Section 4 (along with Ind. Code § 6-1.1-9-1) allows Indiana assessors to assign value for omitted or undervalued property within three years of the relevant assessment date. The Court concluded, “The application of each of these statutes is triggered by different factual circumstances, and neither statute indicates that the application of one precludes an assessment under the other.” Slip op. at 6. The more “specific” statute, in fact, was merely a different assessment statute. The homes were omitted property, and the Assessor was allowed to assign value to them for prior years. Slip op. at 7.
Assessor’s notices were defective; tax bills were not timely notice. The Assessor used Form 122s to notify the Company of the retroactive assessments. Under the applicable provisions, the Court explained: “[A]n assessing official must mail written notice of the assessment of omitted or undervalued real property to a taxpayer that states 1) a general description of the property; 2) the amount of the increased or new assessment; and 3) a statement regarding the taxpayer’s right to review under Indiana Code § 6-1.1-15-1 [the property tax appeals statutes].” Slip op. at 9 (citations omitted). The Form 122s included descriptions of the homes and statements of the amount of the assessments. But they contained no information regarding the Company’s appeal rights. The notices, therefore, were defective. Slip op. at 9-10. While the annual tax bills may have constituted notice, those bills were not issued within three years of the assessment dates. Slip op. at 10 (citations omitted).
Court would not consider new arguments and new evidence on rehearing. The Assessor sought a rehearing, claiming the Court omitted a material fact in reaching its decision. The Assessor stated that the Company had received Form 11 assessment notices for the prior years’ increases and that those notices explained the Company’s review rights. The Assessor submitted certified copies of blank Form 11 notices as proof. The Assessor apparently “filled out” a Form 11 notice for one property, but that notice was not included in the certified administrative record. In an Order issued August 20, 2015, the Court explained: “When a litigant fails to present evidence to the Indiana Board, the Court may not consider that evidence on appeal.” Order at 2 (citation omitted). The Court could not consider the blank Form 11. Id. at 2-3. The Assessor admitted the Form 122 was inadequate notice, so the Court found that it had not omitted a material fact.
The Assessor further claimed the Court’s remedy of invalidating the retroactive assessments was “too extreme.” The Court noted that the Assessor was improperly asserting new arguments or theories. Id. at 3. In addition, the cases relied upon by the Assessor involved criminal convictions, so they were not persuasive. Id. at 4. Finally, the Court noted that it “has previously held that the failure to follow procedural rules is sufficient to invalidate an assessment.” Id. (citation omitted). The Court reaffirmed its holding.
The Court’s original opinion can be viewed here, and it’s Order on Petition for Rehearing can be viewed here.
