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CVS Corp. v. Searcy

Tax Court of Indiana

December 9, 2019

CVS CORPORATION, Petitioner,
v.
CATHY SEARCY, in her official capacity as ELKHART COUNTY ASSESSOR, Respondent.

          ON APPEAL FROM A FINAL DETERMINATION OF THE INDIANA BOARD OF TAX REVIEW

          ATTORNEY FOR PETITIONER: PAUL M. JONES, JR. PAUL JONES LAW, LLC Greenwood, IN

          ATTORNEYS FOR RESPONDENT: CURTIS T. HILL, JR. ATTORNEY GENERAL OF INDIANA KELLY S. EARLS ZACHARY D. PRICE WINSTON LIN ALEKSANDRINA P. PRATT DEPUTY ATTORNEYS GENERAL Indianapolis, IN

          WENTWORTH, J.

         On May 25, 2018, the Indiana Board of Tax Review issued a final determination valuing a CVS store in Elkhart, Indiana for purposes of the 2012 through 2015 assessments. CVS has challenged that final determination, but the Court affirms.

         FACTS AND PROCEDURAL HISTORY

         The property at issue in this case is the CVS store located at 104 West Hively Avenue in Elkhart, Indiana. (See Cert. Admin. R. at 1, 63.) The store, constructed in 2004, is approximately 10, 880 square feet and sits on 1.26 acres of land. (Cert. Admin. R. at 75.)

         The Elkhart County Property Tax Assessment Board of Appeals ("PTABOA") valued the subject property for the 2012 through 2015 assessments as follows: $1, 030, 600; $1, 090, 700; $1, 118, 200; and $1, 106, 200. (See Cert. Admin. R. at 1-2, 10-11, 28-29.) Believing those values to be too high, CVS timely filed appeals with the Indiana Board. The Indiana Board conducted one administrative hearing on all of CVS's appeals in May of 2017.

         During the hearing, certified appraisers for both CVS and the Assessor presented Appraisal Reports in conformance with the Uniform Standards of Professional Appraisal Practice ("USPAP") that valued the subject property for each of the assessment years. (See Cert. Admin. R. at 63-206, 255-531.) CVS's appraiser, Sara Coers, employed all three approaches to value the property (i.e., the sales comparison, income, and cost approaches), reconciling her results into a final value of $800, 000 for 2012; $840, 000 for 2013; $850, 000 for 2014; and $890, 000 for 2015. (See Cert. Admin. R. at 64, 198-99, 1132-33.) In arriving at these final values, Coers gave the most weight to her sales comparison and income approaches. (See Cert. Admin. R. at 75-77, 199, 1132-33.)

         The Assessor's appraiser, J. David Hall, also employed all three approaches, reconciling his results into a final value of $1, 790, 000 for 2012; $1, 800, 000 for 2013; $1, 810, 000 for 2014; and $1, 820, 000 for 2015. (See Cert. Admin. R. at 257, 440, 1438-39.) In arriving at his final values, Hall gave equal weight to each of the three approaches. (See Cert. Admin. R. at 440, 1439.)

         On May 25, 2018, the Indiana Board issued its final determination in the matter. In its final determination, the Indiana Board found that the sales comparison and income approaches presented in both Appraisal Reports contained so many flaws that they were unpersuasive, if not completely unreliable. (See, e.g., Cert. Admin. R. at 1012 ¶ 96.) The Indiana Board then examined the cost approaches provided in each Appraisal Report, and after finding both probative, it ultimately found Coers's approach more persuasive than Hall's. (See Cert. Admin. R. at 988 ¶¶ 18-19, 995-96 ¶¶ 39-42, 1001 ¶ 56, 1002-03 ¶ 62, 1007-08 ¶¶ 75-79, 1010 ¶¶ 86-87, 1012 ¶ 97.) Nonetheless, the Indiana Board found the portion of her cost approach that accounted for the presence of external obsolescence "entirely unsupported." (Compare Cert. Admin. R. at 131-40, 766-67, 773 (indicating why Coers believed the subject property suffered from external obsolescence and how she quantified it) with Cert. Admin. R. at 996 ¶ 42 n.6, 1007 ¶ 78, 1012 ¶ 98 (indicating why the Indiana Board did not find her rationale persuasive).) Consequently, the Indiana Board modified Coers's cost approach by removing the negative adjustment she made to account for the presence of external obsolescence and assigned the following values to the subject property: $1, 222, 805 for 2012; $1, 226, 743 for 2013; $1, 246, 096 for 2014; and $1, 211, 040 for 2015. (Cert. Admin. R. at 1012 ¶ 98 n.10.)

         CVS initiated an original tax appeal on July 6, 2018. The Court heard the parties' oral arguments on May 23, 2019. Additional facts will be supplied as necessary.

         STANDARD OF REVIEW

         The party seeking to overturn an Indiana Board final determination bears the burden of demonstrating its invalidity. Osolo Twp. Assessor v. Elkhart Maple LaneAssocs., 789 N.E.2d 109, 111 (Ind. Tax Ct. 2003). Accordingly, CVS must demonstrate to the Court that the Indiana Board's final determination in this matter is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; contrary to constitutional right, power, privilege, or immunity; in excess of or short of statutory jurisdiction, authority, or limitations; ...


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