FISHER, Senior Judge.
This case concerns whether the Indiana Board of Tax Review erred in upholding David and Karen McKeeman's 2006 real property assessment. The Court finds it did not.
The McKeemans own residential property in Pleasant Township, Steuben County, Indiana. For the 2006 tax year, the McKeemans' property was assessed at $489,000 ($292,800 for land and $196,200 for improvements).
The McKeemans believed their land assessment was too high and sought review first with the Steuben County Property Tax Assessment Board of Appeals and then with the Indiana Board. On March 11, 2011, after conducting a hearing, the Indiana Board issued a final determination upholding the McKeemans' assessment in its entirety.
On April 22, 2011, the McKeemans initiated this original tax appeal. The Court heard oral argument on October 13, 2011.
The party seeking to overturn an Indiana Board final determination bears the burden to demonstrate that it is invalid. Hubler Realty Co. v. Hendricks Cnty. Assessor, 938 N.E.2d 311, 313 (Ind.Tax Ct.2010). Consequently, the McKeemans must demonstrate to the Court that the Indiana Board's final determination is arbitrary, capricious, an abuse of discretion, not in accordance with the law, or unsupported by substantial evidence. See IND. CODE § 33-26-6-6(e)(1), (5) (2014).
In Indiana, real property is assessed on the basis of its market value-in-use: the value "of a property for its current use, as reflected by the utility received by the owner or a similar user, from the property[.]" 2002 REAL PROPERTY ASSESSMENT MANUAL (Manual) (incorporated by reference at 50 IND. ADMIN. CODE 2.3-1-2 (2002 Supp.)) at 2. See also IND.CODE § 6-1.1-31-6(c) (2006). To determine a property's market value-in-use, assessing officials refer to a series of guidelines that explain the valuation process for both land and improvements. See REAL PROPERTY ASSESSMENT GUIDELINES FOR 2002-VERSION A (Guidelines) (incorporated by reference at 50 I.A.C. 2.3-1-2), Bks. 1 and 2. While assessments made pursuant to these guidelines are presumed to be accurate, a taxpayer may rebut this presumption with market-based evidence (e.g., sales data) that indicates that the property's assessment does not accurately reflect its market value-in-use.
The McKeemans have asked this Court to reverse the final determination of the Indiana Board for three main reasons. The McKeemans first contend that the Indiana Board erred in disregarding their claim concerning the establishment of their neighborhood. The McKeemans also contend that the Indiana Board erred in rejecting their base rate claim. Lastly, the McKeemans contend that the Indiana Board erred in concluding that their sales comparison analysis lacked probative value.
Indiana's assessment guidelines provide that assessing officials must establish specific "neighborhoods" within each township for purposes of assessment.
Id.
On appeal, the McKeemans maintain that the Indiana Board's final determination is erroneous because the properties within their neighborhood demonstrate that the Assessor must have ignored Indiana's assessment guidelines in establishing their neighborhood. (See Oral Arg. Tr. at 102-03; Pet'rs' Reply Br. at 4-9; Pet'rs' Br. at 3, 10-11, 13-16.) (See also Cert. Admin. R. at 116-21, 203-08.) For example, the McKeemans explain that certain properties in their neighborhood had access to paved roads while others did not, that significant size (i.e., depth) differences existed between some of the properties, and that a large, commercial, youth camp/retreat center bisected the entire neighborhood thereby destroying any real sense of cohesiveness.
The assessment guidelines, however, clearly indicate that a neighborhood may contain properties that vary with respect to road access, size, and use type. See Guidelines, Bk. 1, Ch. 2 at 8. Thus, those types of differences simply are not per se indicators of an improperly constituted neighborhood. Consequently, the Court cannot say the Indiana Board erred in rejecting the McKeemans' claim regarding the establishment of their neighborhood.
The McKeemans also maintain that the Indiana Board's final determination is erroneous because the Assessor's evidence, in and of itself, demonstrated that several properties that are not comparable to their own were used to establish their land's base rate. (See Pet'rs' Reply Br. at 7-8; Pet'rs' Br. at 3, 6-29.) This, however, is incorrect.
Indiana's assessment guidelines call for the development of neighborhood valuation forms that establish "base rates" for commercial, industrial, and residential land in each of the townships throughout the county. See generally Guidelines, Bk. 1, Ch. 2; IND.CODE § 6-1.1-4-13.6 (2006) (explaining the base rate establishment process). In this case, the administrative record reveals that the Assessor introduced the McKeemans' neighborhood valuation form and their property record cards, which demonstrated that the McKeemans' land was assessed consistent with the established base rate of $5,900 per front foot. (See Cert. Admin. R. at 157-59, 164.) The administrative record, however, does not disclose what properties were actually used in developing that base rate. (See generally Cert. Admin. R.) Consequently, the McKeemans have not shown that the Indiana Board erred in upholding the $5,900 base rate applied to their land.
During the Indiana Board hearing, the McKeemans presented a sales comparison analysis that valued their two parcels of residential land at $62,341
(See Cert. Admin. R. at 53-56, 97-115, 132-40, 198-212.) The Indiana Board determined the analysis lacked probative value because six of the Comps' sales prices were not reliable indicators of those properties' market value-in-use.
For the foregoing reasons, the Indiana Board did not err in upholding the McKeemans' 2006 assessment. Accordingly, the final determination of the Indiana Board is AFFIRMED.