                           NOT DESIGNATED FOR PUBLICATION

                                             No. 120,705

               IN THE COURT OF APPEALS OF THE STATE OF KANSAS

                            In the Matter of the Equalization Appeal of
                                   RUFFIN WOODLANDS, L.L.C.,
                         for the Year 2017 in Wyandotte County, Kansas.


                                   MEMORANDUM OPINION

        Appeal from Board of Tax Appeals. Opinion filed July 2, 2020. Affirmed in part and dismissed in
part.


        Wendy M. Green, assistant counsel, of Unified Government of Wyandotte County/Kansas City,
Kansas, for appellant.


        Kevin J. Breer and Kelli N. Breer, of Breer Law Firm, LLC, of Westwood, for appellee Ruffin
Woodlands, LLC.


        Dwight R. Carswell, assistant solicitor general, Toby Crouse, solicitor general, and Derek
Schmidt, attorney general, for amicus curiae State of Kansas.


Before HILL, P.J., BUSER and BRUNS, JJ.


        PER CURIAM: Wyandotte County (the County) appeals the Kansas Board of Tax
Appeals' (BOTA) decision valuing property owned by Ruffin Woodlands, L.L.C.
(Ruffin) at $548,580 for the 2017 tax year. The County first contends that BOTA erred
by: (1) finding that it failed to show whether it conducted a "thorough review of the
subject property to determine the highest and best use" and (2) relying on the appraisal
evidence presented by Ruffin. The County also argues that K.S.A. 74-2426(c)(4)(B) is
unconstitutional because of its disparate treatment between a taxpayer's and a taxing
authority's rights of appellate review. Upon our review, we find no error by BOTA and
                                                    1
hold that the County lacks standing to raise its constitutional claim. Accordingly, we
affirm in part and dismiss in part.


                        FACTUAL AND PROCEDURAL BACKGROUND

       Ruffin owns 380.9 acres of property in Wyandotte County known as the
Woodlands. The Woodlands is a former dog and horse racing track containing
grandstands, dog kennels, horse barns, and other ancillary buildings built in 1989 and
1990. The facility opened in 1989 and featured greyhound racing after the passage of the
Kansas Parimutuel Racing Act (Racing Act), K.S.A. 74-8801 et seq. Horse racing was
added the following year. The Woodlands was the first racetrack in Kansas regulated by
the Kansas Racing and Gaming Commission and was the first legal gambling outlet
operated in the Kansas City metropolitan area since the 1930s.


       The Woodlands racetracks operated from 1989 until 2008. The Woodlands' annual
handle—the total amount of money wagered—in dog and horse racing decreased
dramatically during its operation. Between 1990 and 1997, the annual handle in dog
racing dropped from $155.2 million to $20.4 million. During that same time, the annual
handle in horse racing decreased from $42.2 million to $1.5 million. The decrease in the
Woodlands' annual handle coincided with the opening of several casinos in the Kansas
City area during the mid-1990s. In the last year that the Woodlands conducted dog and
horse racing, the annual handle for each type of racing was $6.1 million and $1.3 million
respectively. The Woodlands has remained vacant since it closed operations in 2008.


       The Racing Act was enacted in 1987 and has not been repealed. This Racing Act
allows organizations to receive a license to conduct horse and greyhound racing. K.S.A.
74-8813. The Racing Act also provides that applicants may receive (1) a facility owner
license to own a racetrack facility designed for horse and greyhound racing and (2) a
facility manager license to manage a racetrack facility. K.S.A. 74-8815(a) and (b).

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Licensed organizations may conduct parimutuel wagering on horse and greyhound races
at approved racetracks, as well as parimutuel wagering on simulcast horse or greyhound
races. K.S.A. 74-8819.


       In 2007, the Kansas Legislature enacted the Kansas Expanded Lottery Act
(Lottery Act), K.S.A. 74-8733 et seq. This Lottery Act allowed for electronic gaming
machines to be placed at parimutuel licensee locations. K.S.A. 74-8740. But before
electronic gaming machines could be placed, the voters of a county were required to
approve the placement of such machines in the county. K.S.A. 74-8743. The voters of
Wyandotte County approved placement of electronic gaming machines in 2007.


       Under the Lottery Act, the racetrack facility manager receives 25% of the net
gaming machine income. K.S.A. 74-8747(a)(1). Forty percent of the net gaming machine
income is allocated to the State's expanded lottery act revenues fund. K.S.A. 74-
8747(a)(8). The other 35% of net income is allocated to certain funds, government
entities, and gaming expenses. K.S.A. 74-8747(a)(2)-(7), (9). In contrast to the State's
allotted 40% of gaming machine income from parimutuel racetracks, facility managers
for State operated casinos are required to provide only 22% of the casino's gaming
revenue to the State's expanded lottery act revenues fund. K.S.A. 74-8734(h)(12).


       Following the enactment of the Lottery Act, legislation has been frequently
introduced seeking to lower the State's allotment of gaming machine income from
parimutuel racetracks and increase the income kept by the racetrack. For example,
legislation was introduced in 2010 that proposed to reduce the State's allotment from 40%
to 22% and increase the racetrack facility manager's distribution to 58% of the income.
S.B. 401 (2010). However, this bill and other similar bills have been defeated.


       In December 2015, Ruffin purchased the Woodlands for $15 million. At the time
of purchase, Ruffin intended to renovate the property's improvements and operate a horse
                                             3
racing facility with slot machines following the passage of favorable parimutuel racetrack
gaming bills. Since purchasing the Woodlands, Ruffin has continued to support
legislation that would increase the percentage of gaming machine income retained by
racetrack facility managers. See, e.g., H.B. 2173 (2017); H.B. 2537 (2016). But, like
similar legislation previously introduced, the bills died in committee.


       The County retained Kevin Bradshaw to appraise the Woodlands for the 2017 tax
year. Using a computer assisted mass appraisal (CAMA) system, Bradshaw valued the
property at $7,025,690. Ruffin appealed this value to BOTA where the County had the
evidentiary burden to show the validity and correctness of its valuation. See K.S.A. 79-
1609. Ruffin retained Valbridge Property Advisors appraiser Bernie Shaner to appraise
the property. Shaner valued the property at $540,000.


The County's Appraisal Evidence

       At an evidentiary hearing before BOTA, Bradshaw testified that he valued the
Woodlands at $7,025,690 by using the cost approach. The cost approach considers the
value of the land plus the cost to reproduce the improvements minus the depreciation of
the improvements.


       In valuing the improvements on the Woodlands, Bradshaw considered that they
had not been touched in 10 years. Bradshaw determined that the improvements were in
disrepair and had limited value. As a result, Bradshaw applied an economic condition
factor of 20%, meaning an 80% reduction in value was initially applied to the
improvements. Bradshaw also applied a poor physical and functional rating to the
buildings to account for depreciation. Using these adjustments, Bradshaw valued the
buildings at $4,979,300. Bradshaw then determined the land had a value of $2,046,390
for a total property valuation of $7,025,690.



                                                4
       The County's valuation was based on Bradshaw's determination that the highest
and best use of the Woodlands was its current use as a dog and horse racetrack. Bradshaw
explained that under In re Tax Appeal of Yellow Freight System, Inc., 36 Kan. App. 2d
210, 217-19, 137 P.3d 1051 (2006), the County assumes "the current use is [the] highest
and best use unless there's reason to believe otherwise." Bradshaw believed that Ruffin
intended to continue dog and horse racing because there was no evidence that the
buildings were going to be removed. Bradshaw also noted that Ruffin employed a
maintenance person to ensure that the improvements did not further deteriorate.
However, Bradshaw did not analyze whether operating the Woodlands as a dog and horse
racetrack would be financially feasible.


Ruffin's Appraisal Evidence

       At the BOTA hearing, Shaner testified regarding the condition of the
improvements designed for dog and horse racing. Like Bradshaw, Shaner determined the
buildings were in poor condition. Shaner explained that the property was run down and
the structures have deteriorated. Shaner noted many deficiencies with the property:


   • All the buildings had original roofs, several of which were damaged and leaking.
   • Both the horse racing and dog racing facilities had damaged roofs and there was
       mold contamination in both grandstand buildings.
   • The ancillary buildings had exterior wood rot.
   • All the buildings had peeling, fading, and/or discolored exterior paint.
   • The metal railings and staircases had significant oxidation and rust.
   • Several buildings had broken windows and damaged gutters.
   • The asphalt and concrete paving used in the parking lots, roads, and sidewalks was
       cracked and deteriorated.
   • The interior of the buildings contained spots of mold and were in poor repair.
   • There was peeling vinyl tile from previous flooding.
                                            5
   • There was peeling paint on the ceiling and walls of the grandstand buildings.
   • There was damaged drywall and acoustic ceiling tiles from roof leaks.
   • The grandstand areas appeared to have been partially demolished before the
       Woodlands closed.
   • The landscaping on the property was overgrown and unkempt.
   • The plumbing and mechanical systems have been shut down for so long that
       problems will likely occur when restarted.
   • The heating and cooling systems would likely need total replacement.


       Shaner found that using the improvements to continue dog and horse racing was
not the highest and best use of the property. Shaner noted that Ruffin purchased the
Woodlands with plans to renovate it and reopen it as a horse racing track with slot
machines. But Shaner determined that the required improvements to revive the current
structures and convert them into a horseracing facility with slot machines would require
"an unbelievable amount of renovation." As a result, Shaner concluded that using the
Woodlands as a dog and horse racetrack was not physically feasible.


       Shaner also determined that dog and horse racing was not a financially feasible
use of the property. In reaching this conclusion, Shaner examined the historical and
current state of dog and horse racing in Kansas and the United States. Shaner found that
the popularity of dog and horse racing declined significantly during the 20th century, in
part due to increased competition from casinos. As a result, horse and dog racing would
not be financially feasible without supplemental income from slot machines. But slot
machines could only make horse and dog racing financially feasible if the State's share of
the income under the Lottery Act was reduced. And the Kansas Legislature had rejected
recent attempts to reduce the State's share of gaming machine income at parimutuel
racetracks. Therefore, Shaner concluded that:




                                             6
       "[b]ased on a combination of poor property condition, the decline of the greyhound and
       horse racing industries, and the continued failed passage of legislation that would reduce
       the state sales tax on slot machines at the subject [property] (from 40% to 22%), the
       existing improvements do not provide a legally permissible, physically possible,
       financially feasible, or maximally productive use."


       Ultimately, Shaner determined that the highest and best use of the Woodlands was
for residential development after removing the current structures. Shaner noted that the
possible use as residential subdivision development would conform to the pattern of land
use in the market area. After researching the issue, Shaner found that residential
development would be financially feasible because the demand would be "sufficient to
support construction costs and ensure the timely absorption of additional inventory in this
market."


       After finding that the highest and best use of the property was for demolition and
single-family residential development, Shaner used a sales-comparison approach to
determine that the market value of the Woodlands was $540,000 as of January 1, 2017. In
calculating the market value, Shaner concluded that the value of the land was $2,970,000
based on comparable land sales. Shaner then subtracted the estimated cost of
demolition—$2,430,000—to arrive at the $540,000 market value.


BOTA's Decision

       BOTA agreed with Ruffin's evidence and ruled that the appraised value of the
commercial portion of the property was $540,000. BOTA also found that an
improvement on the residential portion of the property should be appraised at $8,580, for
a total appraised value of $548,580. In reaching this valuation, BOTA found that Shaner's
analysis was reasonable and agreed that residential development was the property's
highest and best use. BOTA noted that "[t]he evidence does not indicate whether the
[County] conducted a thorough review of the subject property to determine the highest

                                                   7
and best use. Instead, the [County] assumed that the current use is the highest and best
use." BOTA rejected the County's highest and best use analysis, finding that "[t]he
economic feasibility of horse and dog racing is questionable, and the existing structures
have deteriorated to a condition that would be cost prohibitive to restore them."


       BOTA also agreed with Shaner's higher appraisal of the land's value, finding that
the comparable sales Shaner used were a better indicator of the Woodlands' land value
than the sales relied on by the County. Based on its determination that residential
development was the highest and best use of the property, BOTA noted that demolition
costs needed to be considered in the total appraised value. Finding that Shaner's
demolition estimates were reasonable, BOTA concluded that the $540,000 valuation of
the racetrack facility and associated land was appropriate.


Petition for Reconsideration

       After BOTA issued its opinion, the County filed a petition for reconsideration. In
its petition for reconsideration, the County argued that BOTA erred by ignoring its
evidence of the highest and best use of the property and instead accepting Ruffin's
proposed highest and best use. The County also argued that K.S.A. 74-2426(c)(4)(B) is
unconstitutional because of its disparate treatment of a taxpayer's and a county's right to
petition for review. BOTA sustained its original order, finding no argument required
modification of its opinion and that it lacked jurisdiction to hear the County's
constitutional claim. The County appeals.


                    BOTA'S FINDING THAT THE COUNTY DID NOT
                CONDUCT A THOROUGH HIGHEST AND BEST USE REVIEW

       The County contends BOTA erred when it found "[t]he evidence does not indicate
whether the [County] conducted a thorough review of the subject property to determine
the highest and best use." The County first argues that this finding was erroneous because

                                              8
it provided sufficient evidence to support its assessment that the current use of the
property is the highest and best use. Next, the County argues that BOTA applied the
wrong standard under the Uniform Standards of Professional Appraisal Practice (USPAP)
in making this finding.


Standards of Review

       We review BOTA's decisions under the Kansas Judicial Review Act (KJRA),
K.S.A. 77-601 et seq. K.S.A. 74-2426(c). The County bears the burden of proving the
invalidity of BOTA's actions and decision since it is the party asserting such invalidity.
K.S.A. 77-621(a)(1); In re Equalization Appeal of Wagner, 304 Kan. 587, 597, 372 P.3d
1226 (2016).


       K.S.A. 77-621(c) sets out eight standards under which an appellate court may
grant relief. In this case, the County cites K.S.A. 77-621(c)(4), (c)(5), (c)(7), and (c)(8) to
support its argument that relief should be granted. K.S.A. 77-621(c)(4) allows us to grant
relief if an agency "erroneously interpreted or applied the law." K.S.A. 77-621(c)(5)
allows us to grant relief if an agency "engaged in an unlawful procedure or has failed to
follow prescribed procedure." And K.S.A. 77-621(c)(8) allows us to grant relief if
BOTA's action was otherwise "unreasonable, arbitrary or capricious."


       The KJRA explains how our court reviews an agency's factual determination.
Under K.S.A. 77-621(c)(7) we may grant relief if the agency's action is based on a
determination of fact that is not supported "by evidence that is substantial when viewed
in light of the record as a whole." The phrase "in light of the record as a whole" includes
evidence both supporting and detracting from an agency's finding. K.S.A. 77-621(d). As
a result, we must determine whether the evidence supporting the agency's factual findings
is substantial considering all the evidence. Wagner, 304 Kan. at 599. Evidence is
substantial when a reasonable person would accept it as sufficient to support a

                                               9
conclusion. Geer v. Eby, 309 Kan. 182, 190, 432 P.3d 1001 (2019). When reviewing the
evidence in light of the record as a whole, we do not "reweigh the evidence or engage in
de novo review." K.S.A. 77-621(d).


The County's Evidence of Highest and Best Use

       The County points out that under Kansas caselaw, Bradshaw's report and
testimony provided substantial evidence to support a finding that the current use is the
highest and best use of the property. The County reasons that since it provided substantial
evidence of the highest and best use, BOTA erred when it determined that "[t]he evidence
does not indicate whether the [County] conducted a thorough review of the subject
property to determine the highest and best use."


       In Kansas, the market value of a subject property is based on its highest and best
use. In re Equalization Appeal of Johnson County Appraiser, 47 Kan. App. 2d 1074,
1090-92, 283 P.3d 823 (2012). Our court has identified four criteria used to determine the
highest and best use of property for determining a tax valuation. The highest and best use
must be (1) legally permissible, (2) physically possible, (3) financially feasible, and (4)
maximally productive. Yellow Freight System, 36 Kan. App. 2d 210, Syl. ¶ 8.


       In this case, the County's CAMA report explained that while a property's highest
and best use may change over time, the current use is considered the highest and best use
if there is no evidence of such change. Bradshaw testified that the County's appraisal
assumed the current use was the property's highest and best use because there was no
reason to believe otherwise.


       As the County suggests, our court has previously held that similar evidence was
sufficient to support a finding that a subject property's highest and best use is the
property's continuing use. See Johnson County Appraiser, 47 Kan. App. 2d at 1090-92;

                                              10
Yellow Freight System, 36 Kan. App. 2d at 217-19. But contrary to the County's
argument, these cases do not suggest that an appraiser conducts a "thorough review" of a
property's highest and best use when the appraiser merely assumes that the current use is
the highest and best use. As a result, BOTA did not erroneously apply Johnson County
Appraiser or Yellow Freight System by finding that the County did not conduct a
thorough review of the property's highest and best use.


       Moreover, BOTA's comment regarding the County's analysis is supported by
substantial evidence. Despite its closure in 2008, the County assumed the highest and
best use of the Woodlands was a parimutuel racetrack facility for horse and dog racing.
No parimutuel racetracks have operated in Kansas since the Woodlands closed in 2008.
And Bradshaw admitted that he performed no analysis on whether dog and horse racing
would be financially feasible. Accordingly, we find that a reasonable person could agree
with BOTA's determination that the County did not conduct a thorough review of the
property's highest and best use.


Compliance with USPAP

       The County next argues that BOTA applied the wrong standards under the USPAP
in finding that "[t]he evidence does not indicate whether the [County] conducted a
thorough review of the subject property to determine the highest and best use." After
noting that USPAP Standard 6 applies to mass appraisals and USPAP Standards 1 and 2
apply to single-property appraisals, the County claims:


       "The County's report conforms to USPAP Standard 6 and for BOTA to hold the County's
       report to USPAP Standard 1 or 2 by requiring a thorough highest and best use analysis as
       if performing a single property appraisal would be a deviation of prescribed procedure or
       an error of law."




                                                  11
       "Kansas law requires all appraisals to be prepared in accordance with USPAP
standards." In re Equalization Appeal of Target Corporation, 55 Kan. App. 2d 234, 238,
410 P.3d 939 (2017). A failure by BOTA to adhere to the USPAP standards when
reaching a determination may constitute a deviation from a prescribed procedure or an
error of law. Johnson County Appraiser, 47 Kan. App. 2d at 1087.


       Standard 6 of the USPAP governs the development and reporting of mass
appraisals, whereas USPAP Standards 1 and 2 control the development and reporting of
individual appraisals. Yellow Freight System, 36 Kan. App. 2d at 214. Since the County
valued the Woodlands through a mass appraisal, USPAP Standard 6 applied to its
appraisal. As a result, the County did not need to satisfy the requirements of USPAP
Standards 1 and 2. See Johnson County Appraiser, 47 Kan. App. 2d at 1089-90.


       USPAP Standard 6-3(a) provides: "When necessary for credible assignment
results, an appraiser must . . . identify and analyze the effect on use and value of . . . [the]
highest and best use of the real estate." USPAP, p. 42 (2016-2017 ed.). The comment to
Standard 6-3(a) states that "[i]n considering highest and best use, an appraiser must
develop the concept to the extent required for a proper solution to the appraisal problem."
USPAP, p. 42 (2016-2017 ed.). When an appraiser provides an opinion of highest and
best use, the appraiser must discuss how that opinion was determined in the written report
of mass appraisal. USPAP, Standard 6-8, pp. 45-48 (2016-2017 ed.).


       In this case, the County's report addressed highest and best use by noting "[t]he
highest and best use of a property may change over time if the character of the
neighborhood changes creating demand for a different use. If there is no evidence of such
a change, the current use is considered the highest and best use." And at the hearing,
Bradshaw explained that he assumed dog and horse racing was the highest and best use
because it was the current use. When considering nearly identical circumstances, our
court has found that the county's evidence of highest and best use satisfied the
                                               12
requirements of USPAP Standard 6. Johnson County Appraiser, 47 Kan. App. 2d at
1091-92.


       While the County's evidence may have satisfied the minimum requirements of
determining highest and best use in USPAP Standard 6, the County fails to show that
BOTA erred by suggesting that the County did not conduct a thorough review of the
property's highest and best use. In making the complained-of statement, BOTA did not
suggest that the County failed to satisfy USPAP Standard 6 and never implied that it was
requiring the County to satisfy USPAP Standards 1 or 2. Instead, the statement was part
of BOTA's explanation for why it rejected the County's highest and best use
determination in favor of Ruffin's when calculating the property's fair market value. In
other words, BOTA did not impermissibly reject the County's highest and best use
analysis by finding it violated USPAP standards, it appropriately rejected the County's
determination by reasonably finding that Ruffin's analysis was more reliable.


       Accordingly, the County failed to show that BOTA erred by finding that "[t]he
evidence does not indicate whether the [County] conducted a thorough review of the
subject property to determine the highest and best use."


                  BOTA'S RELIANCE ON RUFFIN'S APPRAISAL EVIDENCE

       The County next contends BOTA erred by relying on Shaner's appraisal because
(1) his highest and best use analysis was incomplete, and (2) he failed to consider the cost
approach and income approach to determine whether his valuation was reasonable.


       As previously stated, we may grant relief if the agency (1) erred in interpreting or
applying the law, (2) failed to follow prescribed procedures, (3) based its action on a
determination of fact not supported by substantial evidence when viewed in light of the
entire record, or (4) ruled in a way that was otherwise unreasonable, arbitrary, or

                                             13
capricious. K.S.A. 77-621(c)(4), (c)(5), (c)(7), and (c)(8). The County bears the burden to
prove that BOTA's decision is invalid. K.S.A. 77-621(a)(1).


Shaner's Highest and Best Use Analysis

       The County first argues that BOTA erred by relying on Shaner's appraisal because
he failed to analyze whether any use, other than vacant land held for residential
development, would be more productive for the property. The County claims that because
of this deficiency, Shaner failed to adequately address the maximum productivity
component of the highest and best use analysis. Although the County does not specify
which subsection under K.S.A. 77-621 would entitle it to relief, we discern that the
County is relying on subsection (c)(8) to suggest that BOTA's reliance on Shaner's
highest and best use analysis was unreasonable.


       To support its argument, the County relies on an excerpt from Property
Assessment Valuation produced by the International Association of Assessing Officers,
which states that assessing maximum productivity "requires the appraiser to determine
which use, from among all uses that are physically possible, legally permissible, and
financially feasible, produces the highest rate of return or value to the property being
appraised." Property Assessment Valuation, International Association of Assessing
Officers, p. 31 (3d ed. 2010).


       However, contrary to the County's claims, Shaner considered uses other than
residential development when determining the highest and best use of the property.
Because the property was in disrepair and attendance for dog and horse racing was in
decline, Shaner found that resuming horse and dog racing in the existing improvements
was not financially feasible. He also considered modifying the existing use by fixing the
structures and adding slot machines. But Shaner concluded that such modifications would



                                             14
only be economically beneficial if the State's share of slot machine income was reduced.
Still, attempts to lower the State's share have been unsuccessful.


       Because the improvements contributed to no economically viable use, Shaner
determined that demolition and redevelopment presented the only productive use of the
land. While Shaner noted that the vacant property could allow for numerous potential
uses, residential subdivision development would conform to the pattern of land use in the
market area.


       Shaner's appraisal sufficiently addressed the issue of highest and best use, and
BOTA reasonably relied on Shaner's analysis. Although the County asserts that Shaner
should have thoroughly analyzed more potential uses, "[t]he highest and best use analysis
is not intended to be an exhaustive analysis of every possible use for the subject
property." Property Assessment Valuation, International Association of Assessing
Offices, p. 32 (3d ed. 2010). Notably, our court has found that BOTA appropriately relied
on less extensive analysis to determine the issue of highest and best use. See Yellow
Freight System, 36 Kan. App. 2d at 217-19 (holding that an appraiser's assumption that a
property's current use is the highest and best use provides sufficient evidence to support
BOTA's determination on the issue).


       While questions may exist regarding some of the assumptions underlying Shaner's
highest and best use analysis, we find nothing that so undermines it that a reasonable
person could not accept his conclusion that the highest and best use of the Woodlands is
residential development after removing the current structures. See In re Equalization
Appeal of Target Corporation, No. 111,602, 2015 WL 2131691, at *4 (Kan. App. 2015)
(unpublished opinion). BOTA did not err by relying on Shaner's highest and best use
analysis.




                                             15
Valuation Approaches

       The County next argues that BOTA erred by relying on Shaner's appraisal because
he failed to analyze the cost approach or the income approach of valuation to determine
whether his appraisal was reasonable.


       Each parcel of real property must be appraised at its fair market value. K.S.A. 79-
501. "Fair market value" is the amount of money that a well-informed buyer would be
justified in paying and a well-informed seller would be justified in accepting for the
property in an open and competitive market. K.S.A. 79-503a.


       There are three recognized approaches for determining the fair market value of
property: (1) the sales-comparison approach, which uses sales of comparable properties
to estimate value; (2) the cost approach, which uses the cost of the land and replacement
of the buildings minus depreciation to estimate value; and (3) the income approach,
which uses the anticipated income generated from the property to estimate value. See
Wagner v. State, 46 Kan. App. 2d 858, 861, 265 P.3d 577 (2011); In re Tax Appeal of
Porter House Apartments, No. 108,579, 2013 WL 6726257, at *3 (Kan. App. 2013)
(unpublished opinion). "All appraisers must consider and apply the three approaches to
value in order to determine the fair market value of property when data to perform each
approach is readily available." 46 Kan. App. 2d at 861 (quoting PVD Directive No. 98-
033). However, utilization of all three approaches may not be appropriate when valuing
certain types of property. See In re Tax Appeal of Porter House Apartments, 2013 WL
6726257, at *3.


       The three valuation approaches are embodied in K.S.A. 79-503a. Johnson County
Appraiser, 47 Kan. App. 2d at 1087. This statute provides a nonexhaustive list of factors
for appraisers to consider in connection with cost and income when valuing property,
including:

                                            16
   • The classification of lands and improvements. K.S.A. 79-503a(a).
   • The size and location of the property. K.S.A. 79-503a(b)-(c).
   • Depreciation, which can include physical deterioration and functional, economic,
       or social obsolescence. K.S.A. 79-503a(d).
   • The cost of reproducing the improvements. K.S.A. 79-503a(e).
   • Productivity while taking into consideration all government restrictions. K.S.A.
       79-503a(f).
   • The property's earning capacity. K.S.A. 79-503a(g).
   • Sale value on the open market. K.S.A. 79-503a(i).
   • A comparison with the value of property that has known and recognized value.
       K.S.A. 79-503a(k).


       In this case, Shaner considered the factors listed in K.S.A. 79-503a when
appraising the Woodlands. Shaner noted that the tract was zoned for agricultural use and
a special use permit allowed horse racing and casino use on the property. But Shaner
believed that the property could likely obtain a zoning change to allow for medium-
density, single-family residential use given the surrounding uses. In valuing the property,
Shaner considered the large size and accessible location of the property.


       After examining the physical deterioration of the buildings and economic
obsolescence of their intended use for dog and horse racing, Shaner found that the
improvements had no remaining economic life. Since continuing use of the current
improvements would not be economically productive, Shaner determined that demolition
and redevelopment was the highest and best use of the property. Therefore, Shaner
valued the property as vacant land after subtracting the cost of demolition.


       To value the land, Shaner used the sales-comparison approach, noting that site
value is most often estimated using that approach. Shaner did not develop a valuation


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based on the cost approach or the income approach. He explained that all the approaches
to value were considered, but only a land valuation based on the sales-comparison
approach was developed given the property's highest and best use.


       BOTA reasonably relied on Shaner's appraisal even though he developed a
valuation based only on the sales-comparison approach. Given that demolition and
redevelopment represent the highest and best use of the property, a well-informed buyer
would not be justified in paying more for the costs of reproducing the same buildings that
would be removed. Because the cost approach would add the value of the property's
improvements to the appraisal, it would not produce the fair market value of the property.


       Additionally, Shaner reasonably determined that an income approach was an
inappropriate method to value the property. The Woodlands has been closed and has
generated no income since 2008. And Shaner determined that continuing the use of the
existing improvements or modifying the improvements' current use would not be
profitable. Accordingly, Shaner's appraisal provided substantial evidence to support
BOTA's valuation even though he relied on the sales-comparison approach.


       BOTA did not err by relying on Shaner's appraisal.


                     CONSTITUTIONALITY OF K.S.A. 74-2426(c)(4)(B)

       The County next contends that K.S.A. 74-2426(c)(4)(B) violates its rights under
the Due Process Clause and Equal Protection Clauses of the Fourteenth Amendment to
the United States Constitution, as well as its rights under Section 1 of the Kansas
Constitution Bill of Rights. The County claims that the statute violates its due process
and equal protection rights because it allows only a taxpayer and not a taxing authority to
petition for review in a district court.



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       Whether a statute is constitutional is a question of law over which we exercise
unlimited review. Solomon v. State, 303 Kan. 512, 523, 364 P.3d 536 (2015). When faced
with a constitutional challenge, we presume the statute is constitutional and resolve all
doubts in favor of a statute's validity. State v. McLinn, 307 Kan. 307, 344, 409 P.3d 1
(2018). Moreover, we must interpret a statute in a manner that renders it constitutional if
there is any reasonable way to do so. "Before a statute may be struck down, the
constitutional violation must be clear." Solomon, 303 Kan. at 523.


       In an appeal of an order by BOTA, any aggrieved party may file a petition for
review in the Court of Appeals. K.S.A. 74-2426(c)(4)(A). But a taxpayer is given the
option to first appeal by filing a petition for review in the district court. K.S.A. 74-
2426(c)(4)(B). If a taxpayer chooses to appeal to the district court, the district court must
conduct a trial de novo, meaning the court tries the matter anew and decides it
independently, based solely on the evidence presented in the district court. See K.S.A.
74 -2426(c)(4)(B); Manzano v. Kansas Dept. of Revenue, 50 Kan. App. 2d 263, 268, 324
P.3d 321 (2014). The County argues that providing the remedy of a de novo trial before
the district court to a taxpayer but not a taxing authority violates its due process and equal
protection rights.


       However, the County lacks the ability to challenge the constitutionally of K.S.A.
74-2426(c)(4)(B) on Fourteenth Amendment grounds. Our Supreme Court has noted that
"local governments do not have standing to invoke the protection of the Fourteenth
Amendment to the United States Constitution against the actions of state government."
Gannon v. State, 298 Kan. 1107, 1133, 319 P.3d 1196 (2014). As a result of this rule,
"political subdivisions of a state lack standing to challenge the validity of a state statute
on Fourteenth Amendment grounds." City of Moore v. Atchison, Topeka, & Santa Fe Ry.
Co., 699 F.2d 507, 511-12 (10th Cir. 1983). Since the County is a political subdivision of
Kansas, see State ex rel. Tomasic v. Kansas City, 237 Kan. 572, 585, 701 P.2d 1314


                                              19
(1985), it lacks standing to challenge the validity of K.S.A. 74-2426(c)(4)(B) on
Fourteenth Amendment grounds.


       Similarly, the County may not rely on Section 1 of the Kansas Constitution Bill of
Rights to challenge the constitutionally of K.S.A. 74-2426(c)(4)(B). This section provides
that "[a]ll men are possessed of equal and inalienable natural rights, among which are
life, liberty, and the pursuit of happiness." Kan. Const. Bill of Rights, § 1.


       Our Supreme Court has found that local governments are not "persons" as that
term is used in Section 18 of the Kansas Constitution Bill of Rights. Gannon, 298 Kan. at
1134. In Gannon, the court noted United States Supreme Court caselaw finding that local
governments may not invoke Fourteenth Amendment protections against actions of the
state. 298 Kan. at 1133. Since Kansas courts typically construe the due process
protections of Section 18 to be the same as those guaranteed by the Fourteenth
Amendment, the Gannon court held that school districts lacked standing to raise a due
process claim under Section 18 because they are local governments. 298 Kan. at 1134.


       Like Section 18 addressed in Gannon, Section 1 of Kansas' Bill of Rights is "given
much the same effect as the Equal Protection Clause of the Fourteenth Amendment."
State ex rel. Tomasic, 237 Kan. at 583. And like in Gannon, we construe a political
subdivision's ability to invoke Section 1 to challenge the constitutionality of a statute in
line with the Fourteenth Amendment and find that it lacks standing to do so. Accordingly,
we dismiss the County's constitutional claims for lack of standing. See Board of Sumner
County Comm'rs v. Bremby, 286 Kan. 745, 750, 189 P.3d 494 (2008).


       Affirmed in part and dismissed in part.




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