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Tax Court: Mall property value should be reduced

April 11, 2016

The Indiana Board of Tax Review did not err when it reduced the property assessments of Lafayette Square Mall for 2006 and 2007, the Indiana Tax Court ruled Friday.

In 2006 and 2007, the mall was owned by companies that were a part of Simon Property Group. It sold the mall to Ashkenazy Acquisition Corp. for $18 million in December of 2007, but had already started administrative appeals challenging the mall’s 2006 and 2007 assessments. The Marion County Property Tax Assessment Board of Appeals reduced them to $28.1 million and $20 million in 2006 and 2007 respectively.

Thinking that was still too high, Simon appealed to the Indiana Board of Tax Review. Simon claimed the assessment should have been $15,281,398 in 2006 and its 2007 assessment $16,849,758. The board agreed with Simon, and the Marion County assessor appealed.

The assessor claimed the Indiana tax board’s final determination must be reversed because it is not in accordance with the law, but the assessor did not provide a cogent argument in this regard, so it received no attention from the court.

The assessor also claimed the final determination constituted an abuse of discretion. He said it erroneously relied on the 2007 sales price to support a reduction in the 2006 and 2007 assessments, and that it was too remote from Jan. 1 2005, and Jan. 1, 2006, valuation dates. He also said Simon failed to prove the sale was representative of the market.

The Tax Court said it has traditionally allowed that taxpayers can present evidence of modern-day property values as long as they can relate that evidence to appropriate valuation dates, so the too remote argument fails.

The representative argument also fails because documents revealed it was a valid transaction. Simon made a prima facie case the mall’s December 2007 sales price was representative of the market as it met fair sale requisitions.

The assessor also had other claims as to why the reduction should not happen, but Judge Martha Blood Wentworth wrote, “The assessor has not met his burden in demonstrating that the Indiana Board’s final determination is contrary to law or constitutes an abuse of discretion, as his arguments on appeal are unpersuasive and often incoherent, rife with open-ended questions, and lack citations to either facts in the administrative record or to legal authority.”

The case is Marion County Assessor v. Simon DeBartolo Group, et al., 49T10-1211-TA-00076.
 

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