ATTORNEYS FOR PETITIONER:                         ATTORNEY FOR RESPONDENT:
MARILYN S. MEIGHEN                                PAUL M. JONES, JR.
ATTORNEY AT LAW                                   PAUL JONES LAW, LLC
Carmel, IN                                        Indianapolis, IN

BRIAN A. CUSIMANO
ATTORNEY AT LAW                                                             FILED
Indianapolis, IN                                                       May 25 2017, 3:18 pm

                                                                            CLERK
                                                                        Indiana Supreme Court
                                                                           Court of Appeals

                                IN THE                                       and Tax Court




                          INDIANA TAX COURT

MONROE COUNTY ASSESSOR,                         )
                                                )
      Petitioner,                               )
                                                )
                     v.                         ) Cause No. 49T10-1512-TA-00032
                                                )
SCP 2002 E19 LLC 6697,                          )
a/k/a CVS 6697-02,                              )
                                                )
      Respondent.                               )


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

                                  FOR PUBLICATION
                                    May 25, 2017
WENTWORTH, J.

      The Monroe County Assessor challenges the Indiana Board of Tax Review’s final

determination establishing the assessed value of SCP 2002 E19 LLC 6697’s, a/k/a CVS

6697-02, (“CVS”) real property for the 2007 through 2013 tax years (the “years at issue”).

Upon review, the Court affirms.
                        FACTS AND PROCEDURAL HISTORY

      The property at issue is a 10,800 square foot CVS store that sits on 1.97 acres of

land in Bloomington, Indiana. (Cert. Admin. R. at 1634-35.) For each of the years at

issue, the Assessor valued the subject property as follows:          $3,043,100 (2007);

$3,037,700 (2008); $3,059,100 (2009); $2,995,100 (2010); $3,007,300 (2011);

$3,021,800 (2012); and $2,978,300 (2013). (Cert. Admin. R. at 129.) Believing these

values to be too high, CVS appealed each assessment to the Monroe County Property

Tax Assessment Board of Appeals (PTABOA). The PTABOA affirmed the assessments,

and CVS subsequently filed appeals with the Indiana Board.           The Indiana Board

consolidated the appeals and conducted an administrative hearing in November of 2014.

      At the administrative hearing, both parties presented appraisal reports done by

certified appraisers according to the Uniform Standards of Professional Appraisal Practice

(USPAP) for each of the years at issue. (See Cert. Admin. R. at 235-445, 1638-1888.)

CVS’s appraisal report (the “Coers Report”) stated that the cost approach was not

applicable because it would not be considered by market participants and there was

inadequate data to develop a valid estimate of value using this approach. (Cert. Admin.

R. at 410-11.) Therefore, the Coers Report relied solely on the sales-comparison and

income approaches, based on a combination of national, regional, and local data, in

valuing the subject property at $2,040,000 in 2007; $1,990,000 in 2008; $1,970,000 in

2009; $1,750,000 in 2010; $1,840,000 in 2011; $1,860,000 in 2012; and $2,010,000 in

2013. (Cert. Admin. R. at 328-411, 415-16.)

      In contrast, the Assessor’s value calculations in its appraisal report (the “Johnson

Report”) used all three approaches, based on local data, to value the subject property.



                                            2
(Cert. Admin. R. at 1807-08.) The Johnson Report concluded that the cost and income

approaches were the most reliable approaches for valuing the subject property, and it

relied on them more heavily for its reconciled values of $2,900,000 in 2007; $2,900,000

in 2008; $3,000,000 in 2009; $3,000,000 in 2010; $3,000,000 in 2011; $3,100,000 in

2012; and $3,100,000 in 2013. (See Cert. Admin. R. at 1807-09.)

       The Assessor also presented a report prepared by another certified appraiser that

reviewed the Coers Report (the “Tillema Review”). (Cert. Admin. R. at 1901-1938.) The

Tillema Review was based on the assumption that the Coers Report used an incorrect

interpretation of the market value-in-use standard.1 (Cert. Admin. R. at 1904, 1907, 1913,

1930-31.) Moreover, it specifically stated that the Coers Report was flawed because 1)

the cost approach was not applied despite being the most reliable means of valuing the

subject property and 2) the sales-comparison and income approaches used non-

comparable properties (i.e., vacant properties and “general retail” instead of “ongoing

national retail pharmacy” properties). (Cert. Admin. R. at 1904-05, 1907, 1909-13, 1917,

1919, 1921, 1923-25, 1927-28.)

       On November 10, 2015, the Indiana Board issued its final determination, finding

that the Coers Report’s valuation of the subject property under the income approach was

the best evidence of its market value-in-use. (Cert. Admin. R. at 178 ¶¶ 119-20.) Thus,

the Indiana Board found that the subject property’s value was $2,237,402 in 2007,




1
  The Real Property Assessment Manual defines a property’s market value-in-use as the value
“of a property for its current use, as reflected by the utility received by the owner or by a similar
user, from the property.” 2011 REAL PROPERTY ASSESSMENT MANUAL at 2 (incorporated by
reference at 50 IND. ADMIN. CODE 2.4–1–2(c) (2011)); see also Howard Cnty. Assessor v. Kohl’s
Ind. LP, 57 N.E.3d 913, 917 (Ind. Tax Ct. 2016), review denied.
                                                 3
$2,178,733 in 2008, $2,165,088 in 2009, $1,850,000 in 2010, $1,980,000 in 2011,

$1,980,000 in 2012, and $2,180,000 in 2013. (Cert. Admin. R. at 179 ¶ 121.)

       The Assessor initiated this original tax appeal on December 22, 2015. The Court

heard the parties’ oral arguments on October 31, 2016. Additional facts will be supplied

as necessary.

                                STANDARD OF REVIEW

       The party seeking to overturn a final determination of the Indiana Board bears the

burden of demonstrating its invalidity.   Osolo Twp. Assessor v. Elkhart Maple Lane

Assocs., 789 N.E.2d 109, 111 (Ind. Tax Ct. 2003). Accordingly, the Assessor 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; without observance of procedure required

by law; or unsupported by substantial or reliable evidence. See IND. CODE § 33-26-6-

6(e)(1)-(5) (2017).

                                       ANALYSIS

       On appeal, the Assessor contends that the Indiana Board’s final determination

must be reversed because it is “random, not supported by substantial evidence, and lacks

a coherent/rational basis for the values reached.” (Pet’r Br. at 1-2.) In support, the

Assessor makes numerous claims that the Court consolidates and restates as 1) whether

the final determination is contrary to law because it applies the wrong standard for market

value-in-use, and 2) whether the Coers Report provides substantial and reliable evidence

of the subject property’s market value-in-use because it does not rely on local data.



                                            4
                                     I. Contrary to Law

       The Assessor first claims that the Indiana Board’s final determination is contrary

to law because it did not value the subject property in accordance with Indiana’s market

value-in-use standard. (Pet’r Br. at 2.) The Assessor argues that in relying upon the

Coers Report, the Indiana Board applied this Court’s previous decisions that have

interpreted the market value-in-use standard erroneously as fair market value. (See Oral

Arg. Tr. at 8, 16, 22-23, 29.) In support, the Assessor states that the addition of Indiana

Code §§ 6-1.1-4-432 and -443 shows that the Legislature intended the Court to interpret

the market value-in-use standard differently. (See Pet’r Br. at 1-2, 7; Pet’r Reply at 1-2.)

       In a recent case regarding another CVS store in a different location, but involving

the same litigants, attorneys, and issues, the Court rejected this same argument. See

Monroe Cnty. Assessor v. SCP 2007-C-26-002, LLC, 62 N.E.3d 478, 481 n.1 (Ind. Tax

Ct. 2016) (upholding the Court’s interpretation of the market value-in-use standard and

finding that Indiana Code §§ 6-1.1-4-43 and -44 did not change that standard), review

denied. Thus, the Court incorporates its analysis and conclusions in that case here and

will not address the argument anew.




2
  Indiana Code § 6-1.1-4-43 applied only to assessments made during the 2014 and 2015
assessment years. See IND. CODE § 6-1.1-4-43(a)(1) (2014) (repealed 2016). Accordingly, it
does not apply to the years at issue here.
3Indiana Code § 6-1.1-4-44 was enacted in 2014 and expressly applied to all assessment appeals
pending before the PTABOA or the Indiana Board at that time, including this matter. See IND.
CODE § 6-1.1-4-44(a)(2) (2014) (repealed 2016). This statute limited the comparable properties
that could be used to determine the market value-in-use of commercial, non-income producing
real properties and sale leaseback properties by prohibiting appraisers from using property that
had been vacant for a year or more. See I.C. § 6-1.1-4-44(a), (d)(1). The Coers Report’s sales-
comparison approach used vacant properties that were prohibited by Indiana Code § 6-1.1-4-
44(d)(1), and thus the Indiana Board gave it no weight. (Cert. Admin. R. at 171-72 ¶¶ 96-98.)
                                               5
                II. Unsupported by Substantial or Reliable Evidence

      The Assessor further asserts that the Indiana Board’s final determination is not

supported by substantial or reliable evidence because in its income approach the Coers

Report relied too heavily on properties that were not located in Monroe County, and its

explanations were inadequate, inconsistent, and conclusory. (Pet’r Br. at 13-17.) The

Assessor further argues that the Indiana Board should not have relied on the Coers

Report’s income approach at all because its values were so close to those determined

under its sales-comparison approach, which the Indiana Board had rejected for including

properties inconsistent with Indiana Code § 6-1.1-4-44(d)(1). (Pet’r Br. at 15-17.)

      A final determination is supported by substantial evidence if the record contains

more than a scintilla of evidence in support of the decision and a reasonable person

viewing the entire record could find enough relevant evidence to support the Indiana

Board’s determination. DeKalb Cnty. Assessor v. Chavez, 48 N.E.3d 928, 931-32 (Ind.

Tax Ct. 2016). The evidence shows that the Coers Report adjusted the comparable

properties used in its income approach to reflect their differences from the subject

property and that it provided thorough explanations of the methodologies it employed.

(Cert. Admin. R. at 172-73 ¶¶ 100-102; see also, e.g., Cert. Admin. R. at 327-48

(explaining the income approach methodologies).)         The Assessor asks the Court,

however, to find that this supporting evidence is not persuasive, which is tantamount to

asking the Court to reweigh the evidence. This Court will not reweigh the evidence absent

an abuse of discretion by the Indiana Board. Hubler Realty Co. v. Hendricks Cnty.

Assessor, 938 N.E.2d 311, 315 (Ind. Tax Ct. 2010). “An abuse of discretion may occur if

the Indiana Board’s decision is clearly against the logic and effect of the facts and



                                            6
circumstances before it, or if the Indiana Board misinterprets the law.” Id. at 315 n.5

(internal citations omitted).   Here, the Assessor has not identified evidence that

demonstrates that the Indiana Board’s final determination is against the logic and effect

of the facts and circumstances in this matter. Consequently, the Court finds that there is

substantial and reliable evidence that supports the Indiana Board’s decision and that it

did not abuse its discretion.

                                     CONCLUSION

       For the above stated reasons, the Indiana Board’s final determination in this matter

is AFFIRMED.




                                            7
