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Alabama law requires the assessment of both real and personal property and the levy of ad valorem taxes on both. Each purchaser of real property who owns such property on October 1 st is required to assess that property with the tax assessor (or, in some counties the revenue commissioner) between October 1 st and January 1 st. Once assessed, the taxpayer is not required to reassess each year unless there have been improvements made or some change in the status of the taxpayer or property occurs. The address of the taxpayer given at the time of assessment will control all subsequent valuation notices or other legal notices, so it is very important for each taxpayer to make sure that the address remains a good address from year to year. Changes in address can be accomplished by a simple letter to the tax assessor in the county where the real property is located. Anyone wishing to assess real property must present to the tax assessor evidence of ownership, such as a copy of a deed.

Personal property returns are made for all personal property owned by the taxpayer as of October 1 st of each year. The return is due by December 31 st. The assessment of such personal property is made by the tax assessor prior to the following October 1 st, and the tax due to be paid prior to January 1 st. Ad valorem real property tax is also due October 1 st, but not delinquent until January 1 st. Alabama law does not permit incremental payment of ad valorem taxes and interest accrues at the rate of 12% per annum on all unpaid ad valorem taxes.

Once the assessment is completed, the tax collector issues the bill. Alabama law has four classes of property and rates of assessment:

Class I – all property of utilities, 30%
Class II – all property not otherwise classified (commercial), 20%
Class III – all agricultural, historic, and residential, 10%
Class IV – pickup trucks for personal use, 15%

The amount of tax is calculated by multiplying the assessed value by the applicable millage rate in effect for the particular location of the property. Like most states, Alabama has numerous exclusions and exemptions to taxation that may be applicable. One of the most commonly overlooked exclusions is the broad exemption of inventory from personal property returns.

Appraisal and valuation in Alabama are conducted by the board of equalization for each of the 67 counties. Alabama law requires notice to the taxpayer if the value changes from the value assigned for the prior year. A taxpayer has 30 calendar days from the date of the notice within which to make a written protest of the valuation. A taxpayer has the legal right to a hearing before the board of equalization and the right to appeal the decision of the board to the circuit court of the county where the real or personal property is located. All appeals must be filed 30 days after the board decision. On appeal, either party may elect to have a jury selected to hear the case.

New Property Owner Must Follow Administrative Appeal Route Started by Previous Owner.

The owner of the property did not appeal the value for 2007. The owner of the property did appeal the value for 2008. A new owner purchased the property before the SBOE hearing. After losing in the SBOE, the new owner filed suit appealing both 2007 and 2008. The suit was filed after the expiration of the time for appealing a decision of the SBOE, but before the December 15th deadline for the filing of a suit in the event no administrative appeal was filed. The Court dismissed the 2008 claim reasoning that once the administrative appeal was filed for 2008, the new owner stepped into the shoes of the previous owner and had to follow that administrative process, including filing the complaint within the time the previous owner would have had. Jewel Investment v. Maricopa County, TX2007-000633.

The notices are out for the reassessment for 2009 taxation based on a January 1, 2008 value. In previous articles, we have raised issues as to where that may lead given the present economic circumstances facing North America.

What we must now be alerted to is not only the value as determined but also the implementation of the “phase-in” and tax capping regimes now within the discretion of the local municipalities. The legislative scheme has changed dramatically as a result of the new reassessment to allow a phase-in of those values for commercial/industrial properties over a four-year period upon which is placed a municipal tax capping/clawback regime.

What is extremely important to note is that not only does an appeal with respect to the assessment returned for 2009 impact the base 2008 value, the appeal may also reference the 2005 value set forth in the Notice of Assessment as the benchmark for the “phase-in”.

Court Holds Assessor's Technique for Removing Hotel Intangibles Illegal

The Superior Court recently held that the Los Angeles County Assessor's technique for removing non-taxable intangible property from the value of
an operating hotel business, in order to determine the assessed value of the hotel's real property, violated California law. The Assessor had urged the county Assessment Appeals Board to accept the "Rushmore appraisal technique" for removing a Hilton franchise, hotel management and workforce, and other intangible assets and rights from the business enterprise value of a full-service hotel. Although the Board followed
the Assessor's suggestion, the court declined to do so. In its ruling, the court stated that the Assessor's "approach is improper" and that the "appraisal technique [used by the Assessor and adopted by the Board] violated California law." The court also said that the Assessor's
valuation method "impermissibly subjected intangible assets to taxation." (EHP Glendale, LLC v. County of Los Angeles, LASC No. BC385925, Feb. 18, 2009.)

Should a private prison be taxed as residential property under Colorado property taxation law? Colorado provides an alternate tax rate for residential property. The commercial assessment rate is 29% of market value, whereas residential property is currently taxed at 7.96% of market value. Several private prison companies have established private prisons and one has contracted with the State of Colorado to operate prisons on behalf of the State. Currently these prisons are taxed at the commercial rate.

Colorado law defines residential improvements as “a building, or that portion of a building, designed for use predominantly as a place of residency by a person, a family, or families. C.R.S. 39-1-102(14.3) Houses, along with apartment buildings and nursing homes fall within this definition. It is reasonable to conclude that a prison should also fall within this definition and receive the benefit of the residential tax rate. The savings would be enormous to the taxpayer.

Enrico Vaccaro carries on a solo legal practice in Bridgeport in a building where he shares office space with two other attorneys. His arrangement with these attorneys includes access to and use of the office furniture and office equipment located there. He owns but a fax machine, printer and a telephone.

Attorney Vaccaro did not file a personal property declaration with the Bridgeport assessor for two assessment years, apparently overlooking his ownership of the aforementioned items. The Bridgeport deputy assessor, reasoning that Attorney Vaccaro “must have owned office furniture and equipment in the year(s) in question….” acted under the relevant statue to complete a declaration for him. The deputy assessor made informed guesstimates about how much personal property Mr. Vaccaroo would likely have therein located. To make matters worse, the deputy assessor added a 25%penalty due to Mr. Vaccaro’s failure to file a declaration.

Understandably perturbed by the deputy assessor’s attribution to him of property he did not own, together with a concomitant tax, Mr. Vaccaro challenged the assessor’s actions in court.

Judge Trial Referee Arnold W. Aronson recognized that Mr. Vaccaro was obligated to file personal property declarations although Judge Aronson held that he not have to list any property owned by the attorneys from whom he leased the office space. Judge Aronson based his ruling on the fact that there was “no evidence that (Mr. Vaccaro) entered into a written contract to lease the office equipment from the other attorneys.” The “intermittent” use of the office equipment as opposed to an ongoing lease, absolved Mr. Vaccaro from any obligation to declare it to the assessor. Moreover, the other attorneys in the office had filed appropriate declarations with the assessor.

Reviewing all the information, the Superior Court reduced Mr. Vaccaro’s personal property assessment from $11,719 to $60, the depreciated value of the telephone, printer, and fax machine.

Vaccaro v. City of Bridgeport, Superior Court, Judicial District of Fairfield, Docket No. CV-074021160 (December 10, 2008)

DISTRICT OF COLUMBIA / WASHINGTON D.C. Property Tax Update
Updated December 2007

Federal prosecutors have charged two D.C. real property tax employees, together with others outside the government, with multiple counts of fraud and conspiracy relating to the issuance of false real property tax refund checks over a seven-year period. The government alleges that one of the employees masterminded the scheme and used her family, friends and some fellow employees to assist in the massive fraud estimated to have reached at least $20 million.

The bogus refund checks were made payable to fictitious companies that the conspirators controlled. The conspirators often used slight variations of the names of legitimate businesses and individuals to further their scheme. The government is now attempting to sort out how this fraud, the largest in D.C. history, went unnoticed for such a long period of time.

In Florida, partial payments of real property taxes are generally not permitted. One exception is when an assessment is being contested, a taxpayer may make a good faith payment of “not less than the amount of the tax which the taxpayer in good faith admits to be owing.” In a recent case, the court addressed good faith payments and wrote that the legislative intent was to ensure that revenue continues to flow to counties during the potentially lengthy legal appeal process. Although the court found it is not statutorily required, the best practice when making a good faith payment is to submit such payment with a cover letter expressly reciting that it is a good faith payment and setting forth the taxpayer’s method of calculation of the taxes being paid. We also recommend identifying the appropriate person in the tax collector’s office and notifying them that a good faith payment is being made so it can be processed and applied correctly.

This is a critical year for metropolitan Atlanta-area taxpayers to be proactive in filing returns of fair value. Failing to do so may leave taxpayers with excessive taxes based on valuations or appraisals performed long before the economic downturn -- which are now irrelevant to current market evaluations. Valuations based upon any appraisal or sale before August, 2007 are suspect. The taxing authorities may be basing taxes upon evaluations on vacant properties or which produce far less revenue than anticipated. Owners and advisors anticipating new evaluations in 2009 will be sadly disappointed because many counties will not send out new notices, hoping to maintain existing tax appraisal values, particularly if property owners have not registered an objection to the existing value by filing a new return indicating a lower value. If there is no new notice, the value remains the same, and there is nothing from which to appeal.

In Georgia, taxpayers file returns of fair market value (as of January 1) by either March 1 or April 1, depending upon the county of the location of the property. In most counties, returns must be received by the taxing authority by the deadline or postmarked by the US Postal Service (NO private meter stamps) by the deadline. Check with each county if postmarks are permitted. This is not a year where appeal rights will be nearly as important as returns, because most property values may well not be changed by the assessors.

If no return is filed for 2009, it is as if the same property is returned as the preceding year and at its previous final evaluation. Those who disagree with last year's evaluation and do not file returns will lose their appeal rights, a devastating mistake and major trap for taxpayers who expect a notice from which they can appeal. Values merely carry forward from year to year unless a return is filed in a timely manner, which is much earlier than the tax notices regarding any changes are mailed. Literally hundreds if not thousands of taxpayers will experience major surprises when they receive no notices but later do receive tax bills based upon the 2008 evaluation (and possibly at an even higher millage rate) and have no recourse.

If a value were established by an appeal, the value carries forward for the next two years, unless it is returned at a different value or if changes to the property affect its value. If the final value in an appeal is satisfactory for the next year, no return should be filed; however, continued scrutiny and vigilance are required in a period of declining values.

Idaho’s property tax appeal season will be upon us soon. This is a year to look closely at your tax values. In order to get ready for the very fast moving appeal process in Idaho, start by considering whether last year’s value makes sense for January 1, 2009. If not, you can initiate informal discussions with your assessor now. Be on the lookout for the formal assessment notices which are mailed on or before the first Monday in June. Appeals to the county board of equalization, a step that must be taken in order to have any further appeal options, are due by the fourth Monday in June. The boards of equalization must complete their work by the second Monday of July, so your appeal may not receive much attention there. Taxpayers may appeal on to the state board of tax appeals or, alternatively, they may go directly to court.

As part of Cook County's revolving three year cycle of property revaluations, all properties in the City of Chicago will be revalued in 2009.

We expect that Assessment Notices for Rogers Park and Lake View will be mailed some time after April 15th. From there the revaluation process will continue throughout the rest of 2009. Effective for 2009, the Cook County Board has revised the Ordinance which governs assessment ratios in all of Cook County. All commercial and industrial properties will now be assessed at 25% of market value. Up to 2009, industrial properties were assessed at 36% of market value and commercial properties were assessed at 38% of market value.

In the wake of the current devaluation of real estate, there is great uncertainty as to how the Chicago Revaluation will go forward. Every segment of the real estate market has suffered significant decline and the City, the County and the State are forecasting budget deficits. A reasonable assumption might be that assessments will go down but rates will increase geometrically. At the same time, history suggests that assessments will rise to minimize the need for big increases in the tax rate.

SPRING 2009 APPEAL DEADLINES

Indiana's property tax system continues to change due to the legislated tax reform last year. Unlike in the past, Notices of New Assessments will not be mailed in most Counties throughout Indiana this year. Although some taxpayers may receive Notices alerting them to changes in the assessed value for their property, it is more likely that any assessment changes will appear on the taxpayer's Spring 2009 tax bill. Once the tax bill is issued, showing a change in an assessed value, the taxpayer will have 45 days from the date the tax bill is issued to file an appeal contesting the new valuation. So it is imperative that taxpayers closely monitor the Spring 2009 tax bills, and be aware of appeal deadlines from those bills.

ISSUANCE OF ASSESSMENTS AND TAX BILLS
CONTINUE TO BE DELAYED IN INDIANAPOLIS (MARION COUNTY)

Much chaos remains in Indianapolis (Marion County) as the result of the State-ordered reassessment in 2007. Annual tax bills are delayed, new assessment notices are delayed, and uncertainty continues. The second installment 2007 (pay 2008) tax bill scheduled to be issued in June 2009 commences the deadline to file an appeal contesting the March 1, 2007 assessment. The taxpayer will have 45 days from the date the tax bill is issued to file an appeal contesting the March 1, 2007 assessment.

As property tax lawyers we are occasionally asked to assist in matters related to governmental incentives to the purchase and development of residential, commercial and industrial real estate projects. In Iowa, two of the more common incentives involve differing approaches that each can result in considerable decrease in real estate taxes attributable to the property and improvements to the property. The two approaches are property tax exemptions and tax incremental financing (“TIF”).

The property tax exemption program generally focuses on an exemption from taxation for the actual value added by the improvements made by the developer. The exemption period, and amount, vary, but a 100% exemption for a relatively short period, two or three years, is a common exemption incentive. The exclusion from taxation is generally tied to the value added to real estate during the process of construction for development or redevelopment.

TIF is available to municipalities pursuant to Iowa Code section 403.19 (2007). It is normally employed in approved tax increment financing districts. A typical City description of TIF benefits it will grant is:

Both property tax exemption and TIF are widely available and should be considered by developers for their projects in Iowa.

The 2009 appeal season is upon us. Most, if not all, of the new 2009 real property values are mailed in the month of March to property owners across Kansas. If you did not receive a 2009 valuation notice, you can contact the county appraiser’s office ( http://www.kansas.gov/kcaa/appraisers/main.htm ). Some counties have valuation information on-line. To see if the county has on-line information, check here. http://www.kansas.gov/kcaa/links.htm .

Taxpayers desiring to appeal their 2009 valuation have 30 days from the date the valuation notice was mailed. The directions to appeal are required by state law to be included on the valuation notice. The first level of appeal is with the county. If you are not satisfied with the results of that informal hearing, the next level of appeal is to the Kansas Court of Tax Appeals (“COTA). Additional information on how to protest can be found on the COTA website. http://www.kansas.gov/cota/

Most Kentucky counties will be mailing out their 2009 assessment notices in April. Kentucky law requires that a taxpayer be notified in writing of any increase in its real property tax assessment. Taxpayers wishing to challenge their tax assessments must do so during the statutory appeal period, generally the first two weeks of May. Taxpayers whose assessments do not increase may still challenge their assessments; however, they must also do so within the appeal period, and they generally will not receive written notice of the dates for appeal.

Appeal dates may differ from county to county, so taxpayers must check with the local assessing authority for the correct appeal dates.

Owners of exempt property may be hurt by a recent Louisiana law change. Historically, the owners of tax exempt property did not have to confirm that the exemption was being respected by the Assessor by checking the tax rolls during the public inspection period. The owner of exempt property could challenge a tax bill by paying the bill under protest and filing a lawsuit in district court. This procedure used to be in La. R.S. 47:2110. As the result of a major rewrite of the Louisiana law on tax sales, La. R.S. 47:2110 was renumbered La. R.S. 47:2134. In addition to renumbering the provision, the Legislature added a change that says exemption challenges must be handled like valuation challenges. The change was effective January 1, 2009. Thus, for 2009 and later years, an owner of exempt property must check the tax rolls during August and September of each year to confirm that exempt property has not been put on the taxable property tax rolls. If the Assessor decides to challenge the exemption and puts the property on the tax rolls, the property owner must file a protest with the local Board of Review and can appeal to the Louisiana Tax Commission. If the property owner waits to get a tax bill, it will likely have lost substantial rights and may be unable to challenge the assessment.

Most communities have sent out their fiscal year 2009 property tax bills. The fiscal year 2009 has an assessing date of April 1, 2008. If a taxpayer wishes to appeal the assessment he must file an Abatement Application with the assessor within 185 days from the commitment date. The commitment date is usually several days before the tax bills are actually sent out. When computing the filing deadline, the taxpayer must pay particular attention as to when the commitment date occurred. Once the Abatement Application is filed the assessor has 60 days to act upon the application. This 60-day period provides a very good opportunity for the taxpayer to present its case to the assessor. After the 60-day period the taxpayer has the right of further appeal. As a practical matter in most cases it is before the assessor that most meaningful results are attained.

In the late winter and spring of each year many assessors in Massachusetts send to various property owners request for information. These requests are sent out pursuant to MGL Ch. 59 section 38D which requires that they be answered within 60 days. Those requests for information are now being sent out. The requests seek income and expense information for calendar year 2008 and rent rolls as of January 1, 2009. This is purportedly to assist the assessors in determining the fair market value of the property for fiscal year 2010. The assessing date for fiscal year 2010 is January 1, 2009. In many communities the 2010 tax bills are sent out toward the end of 2009. In others they are sent out in the late summer or fall of 2009. The failure to provide the assessor with the information requested now may bar a taxpayer’s appeal of the fiscal year 2010 property tax bill in the future.

MARYLAND Property Tax Update

Wilkes Artis, Chtd.
American Property Tax Counsel (APTC)

For decades Michigan has had its own special March Madness; a non-contact sport that sometimes involves nail-biting races against the clock as taxpayers try to file Board of Review protests notwithstanding assessment notices arriving with no time to spare and filing requirements and deadlines that vary among Michigan’s thousands of taxing units (including a handful of jurisdictions that put time on their side by establishing February appeal deadlines). Mercifully, since 2007 those with certain properties, including properties classified as commercial or industrial real, have been given a Board of Review bye. However, the Board of Review challenge goes on for many taxpayers including those who wish to change a property’s classification.

Recent Michigan tax law changes make it more important than ever to ensure that Michigan property is classified correctly . In short, a property’s classification can determine entitlement to Michigan Business Tax (“MBT”) credits (based on property taxes paid) as well as a reduced property tax rate. Property classified as industrial personal has these credit and tax rate advantages; property classified as commercial personal also has a somewhat reduced tax rate. Significantly, Michigan courts may ultimately rule that the classification of a real property parcel determines the classification of that parcel’s personal property.

To date Honigman clients have had some success in these classification appeals. While the State Tax Commission (“STC”) has not granted taxpayer requested relief in the vast majority of classification appeals filed, Honigman was able to persuade the STC to reconsider and reverse decisions it made on a significant issue impacting two Honigman clients. The arguments Honigman prepared were essential to this favorable achievement because another taxpayer, with other counsel making different arguments, had lost on exactly the same issue.

At least as important are on-going efforts in other appeals where Honigman has sought classification relief in local circuit courts. In both of the cases that have been heard to date, the circuit court has issued a writ of mandamus ordering the STC to issue a proper order changing the classification of the property to “industrial personal,” as the taxpayer had requested.

While the victories just mentioned are not the end of the story, the key lesson of the chapters written to date is that taxpayers facing unlawfully excessive taxation must act timely. Clearly, t ime to file 2009 Michigan property tax appeals is winding down. Whether an appeal needs to be filed with a Board of Review, or filed directly in the Michigan Tax Tribunal, taxpayers should act as soon as is possible. Given the complexities and intricacies of Michigan’s procedural and substantive property tax provisions, taxpayers also would be wise to confer with experienced Michigan property tax counsel as soon as they can with respect to their Michigan property taxes.

Many owners saw red when Minnesota’s truth in taxation statements arrived late last fall. Owners wanted to know: why hadn’t values been reduced to mirror the market decline evident by the end of 2008? The reason in most cases is that the assessor values the property as of January 2, 2008 for the pay 2009 taxes. Assessors argue that in early 2008, the market freefall was not apparent.

There is still hope for relief. The question of when market softness became apparent is sector and property specific. Properties with vacancy issues that were emerging or knowable in early 2008 are still ripe for appeal. Leasing and tenant problems that are not apparent to the assessor should be shared with the owner’s property tax professional.

Property owners in Missouri should be receiving their tax bills, within the next several weeks. Some will suffer sticker shock at the amount of the bill. Others may have appeals pending or have already sought relief through the appeal process. If an appeal is currently pending before the State Tax Commission it is required that taxes paid (due December 31, 2008) be accompanied by a protest letter. The letter should be attached to the check. For property owners who do not have appeals pending, nothing can be done about the 2008 bill. However, 2009 will be a reassessment year in Missouri setting the value of the property for tax purposes for the two year cycle. Missouri counties may have different appeal dates. Property owners should be reviewing their property values to determine if an appeal is warranted. Owners should be alert for possible notices of increase in valuation by the Assessor for 2009.

Car Rental Companies' Leasehold Interest Not Subject to Nevada's Possessory Interest Tax

In recent years several airports, such as in Anchorage, Baltimore-Washington, Kansas City, Fort Lauderdale-Hollywood, Houston, and Phoenix, have constructed consolidated car rental facilities to enhance the ground transportation services available to passengers.

These consolidated car rental facilities have also become a significant source of revenue for local and state governments. The issue before the Nevada State Board of Equalization was whether the leasehold interests of the rental car companies operating at the McCarran Consolidated Car Rental Facility ("Car Rental Facility") in Las Vegas were subject to the possessory interest tax. Nevada law, allows a county assessor to assess a tax on privately held leasehold interest, possessory interest, or beneficial interest of real property owned by federal, state, and local governments. Nevada's possessory interest tax is limited in that it does not apply to: (1) property located upon a public airport; or (2) property owned by a public airport authority that is not located upon a public airport but that is used for the purposes of a public airport.

The Car Rental Facility is located approximately three miles from the main terminal at McCarran International Airport. At the time of the appeal, two years of the assessment were before the State Board. We successfully argued that the Car Rental Facility is operated and managed as an extension of the airport terminal. It handles baggage, check-in, parking, and ground transportation services. Clark County Aviation manages the property as it does concessionaires in the main terminal by imposing McCarran Airport regulations and federal regulations on the car rental companies. In addition, the lease agreement with the Clark County Aviation defined the "Airport" to include the Car Rental Facility. As a result, the Clark County Assessor's Office settled the case just moments before the scheduled hearing by agreeing to refund taxes paid for two years and to discontinue assessing a possessory interest tax on the leasehold interest of the car rental companies.

Tax Year 2008 Equalization Ratio to be Published

The New Hampshire Department of Revenue Administration will be publishing the tax year 2008 equalization ratios this spring. The tax year 2008 has an assessing date of April 1, 2008. The filing deadline for tax year 2008 was March 1, 2009. In New Hampshire the equalization ratio is essential in determining whether or not your property is assessed properly. Many taxpayers filed tax year 2008 appeals not knowing what the equalization ratios were. When the equalization ratios are published taxpayers will have much better understanding of how strong or weak their appeals are. If your property is worth $1,000,000 and the equalization ratio is 50% the proper assessment is $500,000. If the equalization ratio is 100% the proper assessment is $1,000,000. If the equalization ratio is 150% the proper assessment is $1,500,000. With recent change in the real estate market we may see significant changes in the equalization ratios.

All property must be reviewed annually to determine the effect of market forces on all assets. In conjunction with this process, the following steps should be taken in order to have standing before the Tax Court.

Luxury Decontrol of Apartments Ruled Illegal When Building Owner Received Tax Abatement Benefits

In a stunning reversal, the Appellate Division of the State Supreme Court ruled that notwithstanding a State Agency’s regulations and opinion to the contrary, rent stabilization provisions which permitted vacancy, high rent or luxury decontrol of apartments were illegal when a property was receiving J-51 tax abatement benefits. The J-51 program grants certain tax exemptions and abatements for property improvements and unfortunately applies stricter rent stabilization restrictions. Until this decision, the owners of Peter Cooper Village and Stuyvesant Town, an 80 acre 11,200 unit residential complex had been able to increase apartments up to market rents when they were vacated, exceeded $2,000 in rent or the household income exceeded $175,000. This ruling overruled a lower court decision, which held that the owners could seek market rents when the apartments became vacant or luxury decontrolled. This latest ruling will limit the rents the owners may charge now and in the past. A further appeal is expected.

Business personal property is subject to assessment at 100% of fair market value as of January 1 of each year in North Carolina. Business personal property includes machinery and equipment, furniture and fixtures, and computers and some forms of software. Listings, which must be filed by January 31 or the extended filing date if an extension is filed, must also include construction in progress, supplies and other forms of assessable property.

Personalty is generally assessed using trending and depreciation tables published by the NC Department of Revenue on an annual basis. The state's tables are based upon IRS class lives and BLS indexes. While generally adequate for mass appraisal purposes, the state's schedules do not reflect extraordinary obsolescence - whether functional or external - and may therefore produce values in excess of market.

Counties must either notify taxpayers of the proposed assessed value and give them 30 days to appeal or the notice is given when tax bills are mailed and the taxpayer has 30 days to appeal at that time.

Critical Filing Deadline – March 31, 2009 Marks the Deadline for Filing Tax Complaints in Ohio.

With the economy in its current state taxpayers must be diligent in minimizing expenses. Contesting over assessed property taxes should be foremost on the list of ways to reduce costs. In order to contest the 2008 taxes payable in 2009 taxpayers must file with the county board of revision no later than March 31, 2009. Complaints must be received by the county by the deadline as such it is wise to have the complaint time stamped to prove that the complaint was timely filed.

Furthermore, taxpayers need to be aware that a tax complaint may have been filed against them by their local school district. Ohio is one of the few states where school districts will file a complaint with the county auditor (assessor) seeking to increase the taxes on properties within their jurisdiction. Although unwanted and expensive as well as potentially inequitable, it is well settled law that permits school districts to file tax cases.

Finally, Ohio tax law is full of pitfalls. Prior to filing taxpayers should seek counsel to ensure that the filing that they intend to make is meritorious as well as properly filed.

Pursuant to 68 O.S. ' 2902, a taxpayer may qualify for a five (5) year manufacturing exemption if certain statutory conditions are met. One condition requires that the initial application reflect a net increase in annualized payroll which must be maintained or increased for each subsequent year. The amount of net payroll increase varies from two hundred fifty thousand dollars ($250,000) to one million dollars ($1,000,000) depending upon the population of the county in which the facility is located. Because layoffs almost certainly decrease the annualized payroll, a taxpayer risks not qualifying for the manufacturing exemption.

The Oklahoma Legislature is currently considering Senate Bill 929, which may suspend the payroll maintenance requirement if a facility has been in existence for ten (10) years and employs at least 250 people. Other bills may also be introduced in this session to address the loss of exemptions due to employee layoffs.

While April 15 th is “tax day” for federal and state income taxpayers, April 1 st is equally important to property taxpayers who wish to avoid paying property taxes for the upcoming year. Below is a list of exemptions for selected types of properties for which applications or statements must be filed with the local county assessor or the Oregon Department of Revenue on or before April 1 st to qualify for exemption from property taxes.

Cancellation of assessment for commercial facilities under construction. New buildings or additions to existing buildings are exempt from property tax assessment for up to two years while under construction. The building or structure must be under construction on January 1, 2007, not have been used or occupied before that time, constructed in the furtherance of the production of income (e.g. an industrial or commercial building or condo), and in the case of nonmanufacturing facilities, the building or structure must first be used or occupied not less than one year from the time construction commences. For manufacturing facilities, any machinery and equipment located at the construction site which is or will be installed in or affixed to the building or structure under construction may also be exempt.

Cancellation of assessment of pollution control facilities. A pollution control facility constructed in accordance with specific Oregon statutes and that has been certified by the Environmental Quality Commission may be exempt to the extent of the highest percentage figure certified by the Commission as the portion of the actual cost properly allocable to the prevention, control or reduction of pollution.

Exemption of nonprofit student housing . Student housing that is rented exclusively to students of any educational institution that offers at least a two-year program acceptable for full credit towards a baccalaureate degree may be exempt from certain ad valorem assessment. The exemption applies to student housing of an educational institution that is either public or private.

Exemption of low income housing. Property owned or being purchased by a nonprofit corporation that is occupied by low income persons or held for future development as low income housing, or a portion thereof, may qualify for tax exemption.

Exemption of ethanol production facilities. The real and personal property of an ethanol production facility may qualify for exemption of fifty percent of the assessed value of its property for up to five assessment years.

Exemption of rural health care facilities. The real and personal property of a health care facility with an average travel time of more than thirty minutes from a population center of 30,000 or more may be exempt from property taxation if the property constitutes new construction, new additions, new modifications or new installations of property as of January 1 st. Additionally, the exemption must be authorized by the county governing body in which the facility is located. The exemption can be for up to three years.

Exemption of long term care facilities. The real and personal property of a nursing facility, assisted living facility, residential care facility or adult foster home may qualify for exemption if the facility has been certified for the tax year as an essential community long term care facility. The Legislature specifically declared that a property tax exemption would enable essential long term care facilities to increase the quality of care provided to the residents because the full value of the exemption is applied to increasing the direct caregiver wages and physical plant improvements that directly benefit the facility residents and staff.

Special assessment of nonexclusive fare use zone farmland. Any land that is not within an EFU zone but that is being used, and has been used for the preceding two years, exclusively for farm use may qualify for farm use special assessment if the gross income derived from the farming operation meets a certain amount that depends upon the size of the farmland.

Special assessment of designated forestland in Western and Eastern Oregon. Forestland being held or used for the predominant purpose of growing and harvesting trees of a marketable species and that has been designated as forestland, or land in either Western or Eastern Oregon, the highest and best use of which is the growing and harvesting of trees, may qualify for special assessment if certain other requirements are met and a timely application filed.

Taxpayers who believe they qualify for cancellations of assessments, exemptions or special assessment should contact the office of the county assessor in which the property is located, or contact the Oregon Department of Revenue, to request application forms and instructions. The fact that a cancellation, exemption or special assessment is granted for one year does not mean the property automatically qualifies for exemption in subsequent tax years. A number of these cancellations, exemptions and special assessments require that applications be filed with the county assessor or the Department of Revenue each year. That is, an exemption or special assessment may be lost if an application is not filed in each successive year.

April 1 is the last day to file for the above-mentioned cancellations, exemptions and special assessments and assessing authorities do not have discretion to accept a late filing.

Pittsburgh, Pa played host to the Pennsylvania Supreme Court this September. The issue brought to the Court by Clifton et al, and Pierce v. Allegheny County was whether the state law that permits a county to establish a base tax year is unconstitutional. Currently state law permits the County to establish a base tax year. In 2005 Allegheny County decided to ignore the reassessment and use 2002, the date of the last reassessment as a base year. A great number of the counties in Pennsylvania use base years. The result of the base year is that counties do not have regular reassessments; and they rely on a sales ratio study to create perceived uniformity.

A ruling against the use of base years will likely create some short term drastic changes to the tax system in Pennsylvania and a flood of reassessments.

In Rhode Island You Must File an Account

In Rhode Island the deadline for filing an account with the assessors is approaching. The proper and timely filing of an account is a jurisdictional prerequisite to a valid appeal in many property tax appeal cases. The account must be filed by January 31, of each year. It is possible to request an extension to file the account between March 1 and March 15th. The account must describe the parcel of property and claim a value as of December 31. The account must be notarized and signed under oath. Many assessors send the account forms to taxpayers. Other assessors make the account forms available at their office. Still other assessors ask that the taxpayer craft its own form. In any event the proper and timely filing of an account is required in most cases. Taxpayer beware the account needs to be filed properly and timely.

Countywide reappraisal often results in increased assessments because Tennessee counties are only reappraised every four- to six-years. The four largest Tennessee counties where last reappraised in 2005, and are among the counties undergoing reappraisal in 2009. In light of recent years’ economic and market conditions, most taxpayers expected values to decrease in 2009. To the shock of many taxpayers, values have increased as much as 18% in certain areas. Although some residential property values have slightly decreased in value or remained flat, commercial property values have largely increased.

The Texas Legislature is currently meeting for its biennial five month legislative session. Last session approximately 300 property tax bills were introduced and 59 were passed by the Legislature. It appears that 300 property tax bills will be introduced again this year.

Utah law provides that all property which “operates as a unit across county lines” is subject to central assessment by the Utah State Tax Commission. Utah Code Ann. § 59-2-201(1)(a). On June 27, 2008, Qwest Corporation submitted a rulemaking request to the Commission wherein it requested that the Commission amend its central assessment rule to explicitly included cable companies that provide two-way telecommunications services within its umbrella of central assessment. Qwest argued that the current operation of certain cable companies in Utah clearly satisfies this statutory requirement for central assessment. Comcast and other cable have opposed the rule claiming that they should be viewed as local operating units because of the franchise agreements they are required to enter into to with cities and counties in order to provide services. The Commission should issue a decision by the end of September as to whether they are willing to entertain rulemaking procedures on this issue.

Refinancing is all but impossible. Assets are not trading. What is the fair market value of a property? According to assessment offices throughout Virginia, not much has changed – most assessments are even or only slightly down. Adding to the challenges owners face are increased real estate tax rates.

Most jurisdictions are in the final stages of preparing the 2010 budget on which the calendar year 2009 tax rate will be based. Look for tax rates to increase more than assessments have fallen. The result for many properties is higher taxes per square foot and assessments in excess of fair market value.

The tax assessors in Washington’s two largest counties have been in the news recently. Longtime King County Assessor Scott Noble was charged with two counts of vehicular assault in connection with a head-on collision while traveling the wrong way on Interstate 5. Initial reports indicated that Mr. Noble was intoxicated, and the Seattle Times published a prominent follow up story on Mr. Noble’s long struggle with alcohol. Both of Seattle’s daily newspapers called for Mr. Noble’s resignation soon after the incident came to light, but he remains in office at this time. The new Pierce County Assessor-Treasurer, Dale Washam, is attempting to fend off budget cuts for his office by reviving the very serious charge that his predecessor, Ken Madsen, failed to comply with the 6-year physical inspection cycle required by state law. Tacoma News-Tribune coverage of the story includes details of prior recall litigation against Mr. Madsen over this issue.

West Virginia Supreme Court Ruling Tough on Taxpayers Wanting to Contest their Assessment

The West Virginia Supreme Court of Appeals has held that the scheme of having the county commission sit as a board of equalization while serving as the chief fiscal agent for the county and deriving approximately 70% of its revenue from property taxes is not, on its face, unconstitutional. In West Virginia, the board of the equalization and review provides the first level administrative review of assessments. The Court also held that a taxpayer challenging an assessment bears the burden of proving by clear and convincing evidence that the assessment is incorrect. It reiterated that the State Tax Commissioner has very broad discretion as to what methods of valuation are applied in arriving at an assessment. The Court further held that upon appeal of an assessment to the circuit court on a writ of certiorari, the circuit court is to conduct a de novo review of the record below and may take additional evidence or may substitute its judgment on both facts and law for that made by the county commission sitting as a board of equalization and review. In Re: Tax Assessment Foster Foundations Woodlands Retirement, No. 33891; Bayer MaterialScience V. State Tax Commissioner et. al. Nos. 33378,33880 & 33881

Wisconsin Court Holds A New Statute Limiting Assessment Challenges To Be Unconstitutional

On January 20, 2009, the circuit court for Milwaukee County struck down as unconstitutional a statute the Wisconsin Legislature enacted in 2008 which limited the rights of certain property owners to challenge their assessments.

Under a longstanding Wisconsin statute permitting challenges to excessive assessments, property owners dissatisfied following review of their assessments by the local board of review can file a claim against the municipality and then file a suit in circuit court, which proceeds as an independent civil action. In 2001, the Wisconsin Supreme Court struck down on Equal Protection grounds a provision in the statute which made it inapplicable in the state’s most populous county, Milwaukee County. The Supreme Court found that the challenge procedures available under the statute were so far superior to the more limited procedures available within Milwaukee County that it was an equal protection violation to provide those procedures to some citizens while denying them to others.

In 2008, the Wisconsin Legislature enacted a new law which permitted municipalities to opt out of the excessive assessment statute by ordinance. In any municipality which enacted such an ordinance, property owners were left without resort to the broader challenge procedures available under the excessive assessment statute, just as Milwaukee County citizens were unable to access those procedures prior to the 2001 Supreme Court decision.

The City of Milwaukee, among other municipalities, enacted such an ordinance, and a Milwaukee property owner challenged the statute on the same Equal Protection grounds as in the earlier suit. On January 20, 2009, the circuit court struck down the statute, finding that it suffered from the same constitutional flaws as the provision the Supreme Court struck down in 2001.