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Friday, May 08, 2009

Ind. Decisions - Two today from the Indiana Tax Court, one involving "non-code" provisions

In Lake Co. Property Tax Assessment Board of Appeals v. St. George Serbian Orthodox Church, a 6-page opinion, Judge Fisher writes:

The Lake County Property Tax Assessment Board of Appeals (PTABOA) challenges the final determination of the Indiana Board of Tax Review (Indiana Board) which granted St. George Serbian Orthodox Church (St. George) a property tax exemption for the 2003 tax year (year at issue). On appeal, the PTABOA argues that the Indiana Board erred when it determined that St. George prima facie demonstrated that its cultural center qualified for the religious purposes exemption as provided in Indiana Code § 6-1.1-10-16. * * *

St. George’s Parish consists of its church, a priest’s residence, a garage, a community hall, a cultural center, and the 73.2 acres of land upon which those improvements stand. The cultural center is the subject of this appeal.

The cultural center, at 39,000 square feet, contains church administration offices, conference rooms, and a banquet facility complete with its own kitchen. St. George uses the cultural center for church events including, inter alia, choir practice, folklore practice, church meetings, and fish fries. The cultural center’s banquet facility is also available to the public for rent. * * *

The taxpayer bears the burden of proving that it is entitled to the exemption it seeks. * * *

In its final determination, the Indiana Board held that St. George met this burden. Indeed, the Indiana Board explained that during the administrative hearing, St. George not only presented evidence as to which church-affiliated organizations regularly used the cultural center, but it also provided a month-by-month listing of events that took place in the cultural center during tax years 2000, 2001, 2002, and 2003 (“calendar summaries”). The Indiana Board determined that these documents prima facie established that the cultural center was used 63% of the time for a religious purpose. The Indiana Board then explained that because the PTABOA failed to rebut this evidence during the administrative hearing, the cultural center was entitled to the exemption for the year at issue. * * *

To demonstrate an abuse of discretion, however, the PTABOA must do more than assert that St. George should have tried its case differently. Rather, the PTABOA must show this Court that there is probative evidence in the administrative record that affirmatively demonstrates that St. George did not predominately use its cultural center for religious purposes. The PTABOA has not met this burden, and therefore the Indiana Board’s final determination must stand.

In St. George Serbian Orthodox Church v. Lake Co. Property Tax Assessment Board of Appeals, a 7-page opinion, Judge Fisher writes:
St. George Serbian Orthodox Church (St. George) challenges the final determination of the Indiana Board of Tax Review (Indiana Board) which denied it a property tax exemption for the 2001 and 2002 tax years (years at issue). The issue on appeal is whether St. George's cultural center is entitled to the religious purposes exemption for the years at issue. * * *

On appeal, St. George claims that the Indiana Board's determination that it received notice of the change in its assessment through its tax bills is not supported by the evidence. St. George explains, however, that the Court need not even address the issue given that pursuant to a recent, retroactive amendment to Indiana Code § 6-1.1-11-3, its exemption applications for the years at issue were in fact timely filed. St. George is correct.

In 2008, the legislature enacted a non-code statutory provision [6] which provided the following: [text omitted]

This non-code section clearly evidences the legislature's intent to allow taxpayers until January 1, 2008 to file their exemption applications for the years at issue. Id. Because St. George's exemption applications were filed on March 3, 2003 for the years at issue, they were timely filed pursuant to Public Law 131-2008, § 66.[7]

[6] "A 'non-code' section is one which, though enacted with a piece of legislation, is not codified within the Indiana Code. Such 'non-code' provisions . . . are appropriately considered by a court when interpreting [] statute[s].” Sullivan v. Day, 661 N.E.2d 848, 851 n.3 (Ind. Ct. App. 1996), vacated in part on other grounds by 681 N.E.2d 713 (Ind. 1997).

[7] The PTABOA argues that because St. George did not raise the applicability of the non-code provision as an issue at the Indiana Board administrative hearing, the issue cannot be considered now on appeal. (Resp't Br. at 8 (citing IND. CODE ANN. § 33- 26-6-3(b) (West 2009) (which states that this Court's review of Indiana Board decisions “is limited to only those issues raised before the [Indiana Board], or otherwise described by the [Indiana Board], in its final determination”)).) The Court disagrees for two reasons.

First, the applicability of the non-code provision could not have been raised as an issue at the July 7, 2007 Indiana Board hearing, given it was not enacted until 2008. Second, and more importantly, in applying the law to this case now, the Court must not only consider and apply the terms of Indiana Code § 6-1.1-11-3, but its non-code provisions as well. See supra note 6.

Posted by Marcia Oddi on May 8, 2009 11:21 AM
Posted to Ind. Tax Ct. Decisions