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Friday, November 13, 2015

Ind. Decisions - Tax Court posts two today, filed Nov. 12th

ILB: Both these opinions have not only the same name, but also the same case # - 71T10-1301-TA-2. But the link to the first is 11121501mbw, and the link to the second is 11121502mbw.

Notable also is the admonition at the end of "502" that begins;

... the Court notes that this case demonstrates yet another instance where infirmities in the DLGF’s fact-finding process have hindered the Tax Court’s review of the final determination and certified administrative record.

In Union Township, St. Joseph County v. State of Indiana, Department of Local Government Finance, a 6-page opinion, Judge Wentworth writes:

On January 8, 2013, Union Township, St. Joseph County filed an original tax appeal challenging the two final determinations of the Department of Local Government Finance (DLGF) that denied its two excess property tax levy appeals made in 2012. On June 18, 2013, the DLGF filed a Motion to Dismiss Union Township’s appeal, asserting that it was moot. The Court, being duly advised, denies the DLGF’s Motion. * * *

The DLGF contends that Union Township’s original tax appeal was rendered moot with the enactment of Indiana Code § 6-1.1-18-18. (See Resp’t Br. at 3-4.) Specifically, it asserts that once Union Township (as the “provider unit”) submitted a petition to increase its maximum permissible property tax levy under Indiana Code § 6-1.1-18-18 for purposes of maintaining the Union-Lakeville Fire Protection Territory, the DLGF was required to grant it “for 2014 and beyond.” Thus, the DLGF maintains that the ultimate relief Union Township seeks in its original tax appeal – the ability to recoup lost property tax revenue through an excess property tax levy – has already been provided through the application of Indiana Code § 6-1.1-18-18. (See, e.g., Hr’g Tr. at 50-51 (asserting that through the application of Indiana Code § 6-1.1-18-18, Union Township had been made whole).) The Court, however, disagrees.

Indiana Code § 6-1.1-18-18 was an obvious legislative response to a budgetary crisis that existed in Union Township. Nonetheless, the Legislature limited the provision of budgetary relief through that statute solely to the Union-Lakeville Fire Protection Territory. See I.C. 6-1.1-18-18. Thus, the revenue generated through a levy increase permitted under Indiana Code § 6-1.1-18-18 is to be placed in Union Township’s fire protection territory fund and to be used exclusively for the benefit of the Union-Lakeville Fire Protection Territory. * * *

Because Union Township’s original tax appeal seeks relief beyond what was provided to the Union-Lakeville Fire Protection Territory under Indiana Code § 6-1.1-18-18, it is not moot. The Court therefore DENIES the DLGF’s Motion to Dismiss.

In Union Township, St. Joseph County v. State of Indiana, Department of Local Government Finance, a 13-page opinion, Judge Wentworth writes:
Union Township challenges the two final determinations of the Department of Local Government Finance (DLGF) that denied the two excess property tax levy appeals it made in 2012. Upon review, the Court reverses those final determinations.

Union Township is a civil taxing unit located in St. Joseph County, Indiana. In July of 2012, Union Township, together with the Union-Lakeville Fire Protection Territory, requested the DLGF’s permission to impose an excess property tax levy. (See Cert. Admin. R. at 14-17.) Their appeal documentation asserted that due to a $40 million “error” in calculating Union Township’s 2010 net assessed valuation, they each suffered a property tax revenue shortfall in 2011. (See Cert. Admin. R. at 15.) More specifically, they explained that the error was the result of the DLGF certifying Union Township’s 2011 budget based on a net assessed valuation of $159,424,430, but St. Joseph County subsequently issuing the tax bills using a lower net assessed valuation of $119,968,732. * * *

For the above-stated reasons, the Court REVERSES the final determinations of the DLGF. The matter is REMANDED to the DLGF so that it may determine whether an error caused the $40 million discrepancy between the net assessed valuation used to certify Union Township’s 2011 budget and the net assessed valuation the St. Joseph County Auditor used in issuing the property tax bills related to that budget. If an error did in fact occur, the DLGF shall order “[a] correction . . . to be applied to [Union Township’s] levy limitations, rate, and levy for the ensuing calendar year to offset the cumulative effect that the error caused[.]” See IND. CODE § 6-1.1-18.5-14(b) (2015).

As an aside, the Court notes that this case demonstrates yet another instance where infirmities in the DLGF’s fact-finding process have hindered the Tax Court’s review of the final determination and certified administrative record. See also, e.g., City of Greenfield v. Indiana Dep’t of Local Gov’t Fin., 22 N.E.3d 887, 892 (Ind. Tax Ct. 2014); Gary Cmty. Sch. Corp. v. Indiana Dep’t of Local Gov’t Fin., 15 N.E.3d 1149, 1150 n.3 (Ind. Tax Ct. 2014). The Court strongly encourages the DLGF to correct these infirmities so that its adjudicatory process can develop all the relevant facts and legal arguments for possible review by the Court.

Posted by Marcia Oddi on November 13, 2015 09:55 AM
Posted to Ind. Tax Ct. Decisions