February 19, 2015
MARINELAND GARDENS COMMUNITY ASSOCIATION, INC., Petitioner,
KOSCIUSKO COUNTY ASSESSOR, Respondent
ON APPEAL FROM THE FINAL DETERMINATION OF THE INDIANA BOARD OF TAX REVIEW.
ATTORNEYS FOR PETITIONER: TORREY J. BAUER, BAUER LAW OFFICE, P.C., Warsaw, IN; JEFFREY T. JONES, JONES LAW, PC, Warsaw, IN.
ATTORNEYS FOR RESPONDENT: GREGORY F. ZOELLER, ATTORNEY GENERAL OF INDIANA, EVAN W. BARTEL, DEPUTY ATTORNEY GENERAL, Indianapolis, IN.
The Indiana Board of Tax Review denied Marineland
Gardens Community Association, Inc.'s 2009 and 2010 property tax exemptions
because it failed to make a prima facie case that it was established for
the purpose of retaining and preserving its land and water
for their natural characteristics. The Court affirms the Indiana Board.
FACTS AND PROCEDURAL HISTORY
Marineland is the homeowners' association for a subdivision located on a lake in Kosciusko County. (Cert. Admin. R. at 469, 506.) Marineland was organized as a domestic, non-profit corporation in 1967. (Cert. Admin. R. at 452.) Marineland owns and maintains ten non-contiguous parcels of land within the subdivision. During the 2009 and 2010 tax years, Marineland applied for a property tax exemption on each parcel claiming that it " maintains these [parcels] for the purpose of retaining and preserving land and water for their natural characteristics[.]" (Cert. Admin. R. at 11, 23.) The Kosciusko County Property Tax Assessment Board of Appeals (PTABOA) denied the exemption applications. (Cert. Admin. R. at 6-8, 18-20.)
Marineland timely appealed each of the exemption denials to the Indiana Board. (See Cert. Admin. R. at 63-330.) The Indiana Board consolidated the appeals and held a hearing on June 13, 2012. At the hearing, Marineland presented, among other things, the testimony of both its president and a subdivision homeowner. The president testified that although one parcel contains gravel, the other nine parcels are unimproved. (Cert. Admin. R. at 528.) He stated that some parcels had narrow walking paths allowing access to the water and the piers from the road. (See Cert. Admin. R. at 506, 550-56.) (See also Cert. Admin. R. at 460-66.) Moreover, he explained that one of the parcels was a long and narrow (600 feet by 60 feet) strip that separated homes from the water's edge. (See Cert. Admin. R. at 495-96, 537-38.) (See also Cert. Admin. R. at 458-59.) This parcel has a seawall running along its length, interrupted by a boat ramp. (See Cert. Admin. R. at 544, 546.) (See also Cert. Admin. R. at 459.) In addition, the president pointed out that several parcels contained utility poles with lighting and possibly utility service. (Cert. Admin. R. at 555.) (See also Cert. Admin. R. at 456, 458.) He also indicated that Marineland permits the public to access all ten parcels, the piers, and the lake for recreational purposes such as fishing, walking, and picnicking. (See Cert. Admin. R. at 522, 533, 549, 559-61.) He further stated that Marineland does not conduct any business activity or allow outside vendors on the land. (Cert. Admin. R. at 529.) Finally, he explained that Marineland remains one of the few areas on Lake Wawasee where geese and other wildlife can still access the land because it is not fenced. (Cert. Admin. R. at 561-62.)
A homeowner from the subdivision testified that Marineland purchased one of the ten parcels specifically to prevent commercial buildings from being built on it. (See Cert. Admin. R. at 567-70.) He continued that Marineland later improved the parcel by adding gravel so that it could be used as a parking lot for the boat ramp. (See Cert. Admin. R. at 570.) (See also Cert. Admin. R. at 462.)
On September 7, 2012, the Indiana Board issued its final determination affirming all of the PTABOA's exemption denials. The Indiana Board found that Marineland failed to make a prima facie case that it was established for the purpose of retaining and preserving its land and water for their natural characteristics as required by Indiana Code § 6-1.1-10-16(c)(3). (Cert. Admin. R. at 432 ¶ ¶ 24-25.)
On February 13, 2013, Marineland initiated an original tax appeal. The Court conducted oral argument on June 21, 2013. Additional facts will be supplied when necessary.
STANDARD OF REVIEW
This Court gives great deference to final determinations of the Indiana Board when it acts within the scope of its authority. Tipton Cnty. Health Care Found. v. Tipton Cnty. Assessor, 961 N.E.2d 1048, 1050 (Ind.Tax Ct. 2012). The Court will reverse a final determination of the Indiana Board only if it is:
(1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;
(2) contrary to constitutional right, power, privilege, or immunity;
(3) in excess of statutory jurisdiction, authority, or limitations, or short of statutory jurisdiction, authority, or limitations;
(4) without observance of procedure required by law; or
(5) unsupported by substantial or reliable evidence.
Ind. Code § 33-26-6-6(e)(1)-(5) (2015). The party seeking to overturn the Indiana Board's final determination bears the burden of establishing its invalidity.
Osolo Twp. Assessor v. Elkhart Maple Lane Assocs., 789 N.E.2d 109, 111 (Ind.Tax Ct. 2003). Moreover, the Court will not reweigh any evidence presented or reassess the credibility of any witnesses who testified at the administrative hearing. Shelby Cnty. Assessor v. CVS Pharmacy, Inc. #6637-02,
994 N.E.2d 350, 353 (Ind.Tax Ct. 2013).
LAW AND ANALYSIS
Indiana Code § 6-1.1-10-16(c)(3) exempts a tract of land from property tax if it " is owned by a nonprofit entity established for the purpose of retaining and preserving land and water for their natural characteristics[.]" IND. CODE § 6-1.1-10-16(c)(3) (2009). The Indiana Board denied Marineland's exemption applications because it failed to show that it was established for the purpose of retaining and preserving the natural characteristics of its land. (See Cert. Admin. R. at 431 - 32 ¶ ¶ 20-24.) On appeal, Marineland asserts that because the Indiana Board gave no weight to its evidence showing that the subject parcels were maintained and preserved for their natural characteristics, its final determination constitutes an abuse of discretion and is unsupported by substantial evidence. (See Pet'r Pet. Judicial Review at 3-4.)
To be eligible for the exemption, Marineland had to show that it was established for the purpose of retaining and preserving its land for its natural characteristics. The record reveals that Marineland did not submit any organizational documents to the Indiana Board that laid out the purpose for which it was established. (See generally Cert. Admin. R. at 438-66 (indicating what evidence Marineland submitted at the administrative hearing).) (See also Cert. Admin. R. at 431-32 ¶ ¶ 20, 23.) Instead, Marineland's president simply presented evidence demonstrating how Marineland has and continues to use the land.
Even if evidence of a property's current or long-standing use could prove why an organization was established, much of the evidence that Marineland presented is contradictory. The Indiana Board recognized that some of Marineland's evidence might indicate that it was preserving and retaining its land and water for their natural characteristics. (See Cert. Admin. R. at 431-32¶ 21.) For instance, nine of its parcels were unimproved, geese and people had access to the land because it was not fenced in, and trees and grass were present on the parcels. (See Cert. Admin. R. at 522, 531-32, 561-62.) In addition, Marineland does not conduct any business activity or permit outside vendors on the land. (See Cert. Admin. R. at 529.) Nonetheless, the Indiana Board pointed out that other evidence showed that Marineland's land was used in a manner inconsistent with being established for the purpose of retaining and preserving the natural characteristics of its land. (See Cert. Admin. R. at 431¶ 21.) For example, several parcels contained improvements: one parcel was a gravel lot used for parking; another parcel had a long cement seawall, a boat ramp, and boat docks; and several parcels had utility poles with lighting. (See, e.g., Cert. Admin. R. at 520-21, 531-32, 542, 544, 546-47, 554.) In addition, much of Marineland's evidence focused on the use of the parcels for recreational activities such as walking, fishing, and boating. (Cert. Admin. R. at 506, 522, 532-34, 535-36, 546-47, 549, 554, 559-60.) Marineland, however, failed to explain to the Indiana Board how these uses furthered the exempt purpose.
This Court will find that a final determination of the Indiana Board is supported by substantial evidence if a reasonable person could view the record in its entirety and find enough relevant evidence to support the Indiana Board's determination. See Amax Inc. v. State Bd. of Tax Comm'rs,
552 N.E.2d 850, 852 (Ind.Tax Ct. 1990). Here, a reasonable person viewing the record would find enough relevant evidence to support denying the exemption because Marineland did not explain how its evidence indicates that it was established for the purpose of retaining and preserving the land and water for its natural characteristics under Indiana Code § 6-1.1-10-16(c)(3). See Long v. Wayne Twp. Assessor,
821 N.E.2d 466, 471 (Ind.Tax Ct. 2005) (stating that in order to make a prima facie case, a taxpayer must walk the Indiana Board and this Court through every element of its analysis) review denied.
For the foregoing reasons, the Court finds that the Indiana Board's final determination is supported by substantial evidence and is not an abuse of discretion. Accordingly, the Court AFFIRMS the Indiana Board's final determination in this matter.