Weston Paper and Manufacturing Company v. Department of Local Government Finance

ATTORNEY FOR PETITIONER:    ATTORNEYS FOR RESPONDENT:
DAVID L. PIPPEN    STEVE CARTER    
ATTORNEY AT LAW     ATTORNEY GENERAL OF INDIANA
Indianapolis, IN    Indianapolis, IN
    
     LINDA I. VILLEGAS
    DEPUTY ATTORNEY GENERAL
    Indianapolis, IN
_____________________________________________________________________

    IN THE INDIANA TAX COURT _____________________________________________________________________

WESTON PAPER AND MFG. COMPANY, ) ) Petitioner, ) ) v. ) Cause No. 49T10-9903-TA-15 ) DEPARTMENT OF LOCAL ) GOVERNMENT FINANCE, See footnote         )
                )
    Respondent.            )    
_____________________________________________________________________
 
ON APPEAL FROM A FINAL DETERMINATION OF
THE STATE BOARD OF TAX COMMISSIONERS
 
NOT FOR PUBLICATION
SEPTEMBER 10, 2003

FISHER, J.
    Weston Paper and Manufacturing Company (Weston) appeals the State Board of Tax Commissioners' (State Board) final determination valuing its real property for the 1995 tax year. The issue is whether the State Board erred in grading Weston's improvement a "C." See footnote For the following reasons, the Court AFFIRMS the State Board's final determination.
FACTS AND PROCEDURAL HISTORY
    Weston owns an improvement in Allen County, which it uses for light manufacturing, warehousing, and office purposes associated with its business. For the 1995 assessment year, the local assessing officials graded Weston's improvement a "C." Weston appealed this assessment to the Allen County Board of Review (BOR) asserting that the "C" grade was incorrect. The BOR, however, denied its claim. In response, Weston appealed the BOR's determination to the State Board arguing that the improvement's grade should be reduced from "C" to "D." After a hearing on June 16, 1998, the State Board issued a determination denying Weston's request. See footnote
    On March 3, 1999, Weston initiated an original tax appeal. The parties stipulated to the record and, on March 9, 2001, this Court heard the parties' oral arguments. Additional facts will be supplied as necessary.
ANALYSIS AND OPINION
Standard of Review
This Court gives great deference to the final determinations of the State Board when it acts within the scope of its authority. Hamstra Builders, Inc. v. Dep't of Local Gov't Fin., 783 N.E.2d 387, 390 (Ind. Tax. Ct. 2003). This Court will reverse a final determination of the State Board only when its findings are unsupported by substantial evidence, arbitrary, capricious, constitute an abuse of discretion, or exceed statutory authority. Id.
    Furthermore, a taxpayer who appeals to this Court from a State Board final determination bears the burden of showing that the final determination is invalid. Id. To do so, the taxpayer must present a prima facie case by submitting probative evidence concerning the alleged assessment error. Probative evidence is evidence sufficient to establish a given fact that, if not contradicted, will remain sufficient. Id.; See also Hoogenboom-Nofziger v. State Bd. of Tax Comm'rs, 715 N.E.2d 1018, 1023 (Ind. Tax. Ct. 1999) (stating that the State Board's duty to support its final determination with substantial evidence is not triggered until the taxpayer has offered probative evidence to establish its prima facie case).
Discussion
    In Indiana, an assessor uses his subjective judgment to assign a grade to an improvement. See Mahan v. State Bd. of Tax Comm'rs, 622 N.E.2d 1058, 1064 (Ind. Tax Ct. 1993). The grading system allows the assessor to recognize variations in an improvement's materials, design, and workmanship. See Ind. Admin. Code tit. 50, r. 2.2-10-3(a) (1996). An established grade is applied as a multiplier to a previously determined base reproduction cost to arrive at a True Tax Value for an improvement. Miller Structures, Inc. v. Indiana State Bd. of Tax Comm'rs, 748 N.E.2d 943, 952 (Ind. Tax. Ct. 2001).
    At the administrative hearing, Weston claimed that its improvement should have been priced as a kit building or, in the alternative, assigned a "D" grade rather than a "C" grade. See footnote To support its claim, Weston presented photographs of the interior and exterior of the building and a report titled "Assessment Review and Analysis" (Analysis) prepared by its property assessment consultant, Lance K. Rickard (Rickard) of Landmark Appraisals, Inc. In this brief report, Rickard stated that "[t]he subject property does not conform to the base specifications of the pricing schedules [for "C" grade buildings]." (Joint Ex. 3 at 3 (emphasis in original).) Furthermore, he concludes that "[t]he subject property's warehouse and manufacturing sections are mostly light pre-engineered steel frame with metal siding [consistent with a kit building and] should be graded no higher than a "D." (Joint Ex. 3 at 3.)
Such statements are nothing more than conclusions and do not constitute probative evidence. As this Court has in the past stated, "[such] contentions are conclusory because they do not specifically detail why the improvements better resemble the description of D grade improvements as set forth in [the Indiana Administrative Code]. A taxpayer's conclusory statements do not constitute probative evidence concerning the grading of the subject improvement." Miller Structures, Inc., 748 N.E.2d at 953. Consequently, Weston failed to present a prima facie case and the determination of the State Board stands.
CONCLUSION
For the reasons stated above, this Court AFFIRMS the determination of the State Board.

Footnote: The State Board of Tax Commissioners (State Board) was originally the Respondent in this appeal. However, the legislature abolished the State Board as of December 31, 2001. 2001 Ind. Acts 198 § 119(b)(2). Effective January 1, 2002, the legislature created the Department of Local Government Finance (DLGF), see Indiana Code § 6-1.1-30-1.1 (West Supp. 2001)(eff. 1-1-02); 2001 Ind. Acts 198 § 66, and the Indiana Board of Tax Review (Indiana Board). Ind. Code § 6-1.5-1-3 (West Supp. 2001)(eff. 1-1-02); 2001 Ind. Acts 198 § 95. Pursuant to Indiana Code § 6-1.5-5-8, the DLGF is substituted for the State Board in appeals from final determinations of the State Board that were issued before January 1, 2002. Ind. Code § 6-1.5-5-8 (West Supp. 2001)(eff. 1-1-02); 2001 Ind. Acts 198 § 95. Nevertheless, the law in effect prior to January 1, 2002 applies to these appeals. Id. See also 2001 Ind. Acts 198 § 117. Although the DLGF has been substituted as the Respondent, this Court will still reference the State Board throughout this opinion.
Footnote: In addition, Weston raises various state and federal constitutional claims that this Court has declined to reach in previous cases. See, e.g., Barth, Inc. v. State Bd. of Tax Comm'rs, 756 N.E.2d 1124, 1127 n.1 (Ind. Tax. Ct. 2001). Because Weston's claims and supporting arguments are identical to those previously rejected by the Court, the Court will not address them.
Footnote: However, the State Board did determine that an excessive amount of land was classified as primary and adjusted the assessment accordingly. (Stip. R. at 7, 13.) That determination was not challenged in this appeal.
Footnote: Weston argues that the State Board's finding "of 322 linear feet of wall [that] is completely steel sandwich panel siding" is an implicit acknowledgment by the State Board that its improvement is a kit building. ( See Stip. R. at 12.) Weston, however, failed to support this conclusion through probative evidence. In other words, Weston was required to show how under the regulations, 322 feet of sandwich paneling made its improvement a kit building. Consequently, its argument fails on this point. See Miller Structures, Inc., 748 N.E.2d 943 at 953 (a taxpayer challenging a grade assessment must present evidence specifically demonstrating why the particular improvement at issue better resembles an alternative grade).