The Indiana Tax Court Friday upheld a final determination by the Indiana Board of Tax Review to assess farm land as agricultural that was purchased by a developer but remained undeveloped for years.
In Hamilton County Assessor v. Allisonville Road Development, LLC, 49T10-1204-TA-30, the Hamilton County assessor appealed the board’s final determination, which reduced Allisonville Road Development’s 2008 assessment to $15,684 on vacant land located in Fishers. The land had been in the hand of developers since the 1990s; it was actively farmed prior to that. Allisonville Road Development purchased the parcels in 2006.
The land developer challenged the assessor’s change in property classification from agricultural land to undeveloped, useable commercial land. No commercial activity had taken place on the land. The land was originally assessed at $2.237 million, which was reduced by the county property tax assessment board of appeals to $1.427 million before the developer appealed to the Board of Tax Review.
The Board of Tax Review explained that land could be reassessed under Indiana Code 6-1.1-4-12 if new events occurred, such as a change in the land’s use. Cessation of farming activities didn’t constitute a change sufficient to warrant reassessment.
“Here, the Assessor claims that the subject property has been used for commercial purposes since the 1990s because that is when it was sold to commercial developers and all active farming operations ceased. Thus, the Assessor equates a ‘change in use’ to nothing more than a change in ownership and potential use. A ‘change in use’ under Indiana Code § 6-1.1-4-12, however, requires something more,” Senior Judge Thomas Fisher wrote.
“Under the 2002 version of Indiana Code § 6-1.1-4-12, reassessments based on new classifications are permissible when land is subdivided into lots, rezoned, or put to a different use: i.e., when events that indicate that commercial development is imminent occur. Here, the cessation of farming activities and the subsequent non-use of land does not necessarily evidence the imminence of commercial development.”