Montgomery County Ohio Property Tax - PDF

							                     OHIO BOARD OF TAX APPEALS

Marek & Maria Fiszlewicz,           )              CASE NO. 2004-M-1157
                                    )
       Appellants,                  )             (REAL PROPERTY TAX)
                                    )
             vs.                    )             DECISION AND ORDER
                                    )
Montgomery County Board of Revision )
and the Montgomery County Auditor, )
                                    )
       Appellees.                   )

APPEARANCES:

                For the Appellants -     Marek Fiszlewicz, pro se
                                         Maria Fiszlewicz, pro se
                                         1967 Woodson Court
                                         Dayton, Ohio 45459

                For the County -         Mathias H. Heck, Jr.
                Appellees                Montgomery County Prosecuting Attorney
                                         Laura G. Mariani
                                         Assistant Prosecuting Attorney
                                         P.O. Box 972
                                         301 W. Third Street
                                         Dayton, Ohio 45422

         Entered July 29, 2005

Ms. Margulies, Mr. Eberhart, and Mr. Dunlap concur.

             This cause and matter comes to be considered by the Board of Tax

Appeals upon a notice of appeal filed by appellants on October 16, 2004 from a

decision, dated September 17, 2004, of the Montgomery County Board of Revision

("BOR"), appellee.

             The subject property is located in the Trotwood taxing district of

Montgomery County, Ohio, and further identified as parcel no. H33-5-5-28. The
Montgomery County Auditor found the true and taxable values of the subject property

for tax year 2003 to be as follows:

Parcel No. H33-5-5-28
                                               True Value    Taxable Value
Land                                            $ 68,870      $ 24,100
Building                                        $ 143,120     $ 50,090
Total                                           $ 211,990     $ 74,190

              Upon consideration of the complaint filed by appellants, the BOR

determined the true and taxable values of the subject property for the 2003 tax year

were correct as assessed by the auditor.

              Through their notice of appeal, appellants claim that the correct value

for their parcel for tax year 2003 is as follows:

Parcel No. H33-5-5-28
                                               True Value    Taxable Value
Land                                            $ 35,000      $ 12,250
Building                                        $ 120,000     $ 42,000
Total                                           $ 155,000     $ 54,250

              The matter was submitted to the Board of Tax Appeals pursuant to R.C.

5717.01 upon the notice of appeal, the statutory transcript certified by the

Montgomery County Auditor as secretary of the BOR and the testimony adduced at

the hearing before this board.

              The subject property is an 8.274-acre plat of land located in Trotwood,

Montgomery County.        The property is improved with a single rental property

containing two units. Each unit is approximately 1,372 square feet and includes three

bedrooms, two full baths (although no master bathroom), and a two-car garage. Each
rental unit leases for approximately $750 per month. The appellants testified that they

were unable to raise rents because of competing rental properties, particularly the

apartment complex abutting their property. The apartment complex, Mr. Fiszlewicz

testified, rented a 2,000-square-foot, three-bedroom townhouse, with basement, for

$690.

              The appellants purchased the parcel in 1992 for $33,500. According to

their testimony, they originally intended to build more than two rental units on the

property. However, the land is not level and slopes to a creek. A portion of their

property is on each side of the creek. The water table is quite high at certain spots on

the appellants' land and rainwater at times does not quickly drain. Because of the

water drainage issues, which continue to be a problem to the present time, additional

costs to the original building were incurred in order to level the land and to secure the

footers for the building. Additionally, because the storm and sanitary sewers do not

reach the appellants' entire property, the cost to bring needed services to additional

buildings, according to the appellants, would be quite high.

              At the hearing before this board, the appellants presented information

concerning rental properties they believed to be comparable to the subject. The

appellants testified, and the testimony was acknowledged by the witness for the

appellee BOR, that few rental properties in their neighborhood had sold during a

relevant time period. Accordingly, the appellants expanded their research to sales in

neighborhoods they believed comparable to their own.             While not physically
inspecting each and every property they offered as comparables, the appellants,

especially Mrs. Fiszlewicz, were quite informed about the comparable sales. Mrs.

Fiszlewicz testified that she had viewed a number of the properties when they were

for sale because the appellants were at times potential purchasers, interested in adding

additional locations to their rental business.

              The appellants claimed that their property as a whole is overvalued,

beginning with the 8+ acres of land, assessed by the BOR at $68,870, or

approximately $8,350 per acre. The appellants provided auditor's records of a 26-acre

plot owned by a church, assessed for $63,000 ($2,423 per acre), a 40.928-acre plat of

land valued at $117,280 ($2,878 per acre) and a one-acre, unimproved parcel assessed

at $250 for the acre. The appellants claim that the auditor's valuations placed upon

these three properties is evidence that the assessment of their property is too high.

              The appellants then turned to the overall value of their property and

introduced evidence of sales of rental properties they believed to be comparable to

their property. The first group of sales occurred in a neighborhood known as Shiloh

Gardens.    The appellants testified that Shiloh Gardens is an older, but well-

maintained, neighborhood containing a number of doubles.              Seven two-family

properties sold during 2003 and the first five months of 2004. The sales prices ranged

from $113,000 for a double sold in April 2003 to $125,000 for a double sold in

November 2003. The properties are smaller than the subject, both in square footage

and number of bedrooms per unit. However, one property that recently sold, 5157
Kingsford Drive, is configured with three bedrooms in one unit and two bedrooms in

the other. The rents received by the Shiloh Gardens properties, ranging from $550 to

$655 per month, are lower than the rents garnered by the subject. Even the rent for

the three-bedroom unit, while the highest rent in the comparables, was $655 per

month.

                The appellants next presented information concerning properties located

on Basore Road that they believed to be comparable to the subject. The properties in

this area were closer in size to the subject, with three bedrooms and two bathrooms

per side. The appellants testified that the properties on Basore Road backed up to a

golf course, a nicer feature than the location of their property, which backed up to a

large apartment complex.

                While the appellants presented the auditor valuations for five properties

located on Basore Road, they found only two sales occurring during a relevant time

period. One property sold in June 2004 for $124,000 and the other sold in May 2001

for $126,000.

                The appellants also presented auditor's records for eleven properties

located in Riverside, Ohio. Only one property sold within a relevant time period.

However, the appellants testified that the valuations assessed against these properties

were relevant, as their property was modeled after the plans used to construct the

eleven properties listed.
             Finally, the appellants presented information concerning six properties

located on Glenside Court in Trotwood. These units are located near the subject

property. Some of the units were constructed at the same time as the subject property;

some are a little newer. While many have been for sale, only one double, 320-322

Glenside Court, has sold.    That property sold in May 2000 for $152,000.         The

appellants felt evidence of the auditor's values assessed against the Glenside Court

properties was relevant to their claim that their property was overvalued because of

the auditor's actions regarding the Glenside Court properties between 2001 and 2004.

In 2004, the auditor reduced the assessed values of the Glenside Court properties,

some by as much as 40 per cent.

             Following the appellants' testimony, the BOR presented the testimony of

Margie Belles, an employee of Title Assessment and Tax, an independent contractor

working with the Montgomery County Auditor's office. Ms. Belles did not present an

appraisal of the subject property, although she did indicate that she performed two of

the generally accepted forms of valuation, the income approach, and the sales

comparison approach, and concluded to a value under both methods. Ms. Belles

explained that she was asked to review information submitted by the appellants at the

hearing before the BOR. For purposes of this hearing, Ms. Belles testified regarding

value but did not provide any further factual information, other than what had been

provided by the appellants and the maps discussed infra.
              At the BOR's hearing, the appellants presented information regarding

certain land sales taking place in Montgomery County which the appellants believed

to be comparable to their property. Ms. Belles reviewed those sales, the location and

configuration of which were exhibited in Appellee's Ex. 3. Ms. Belles acknowledged

that the sales prices presented by the appellants were correct and the land acreage was

similar to the appellants' land. Nevertheless, Ms. Belles testified that it was her

opinion the appellants' land was more valuable than the comparables presented

because of the amount of road frontage available in the subject. The comparables had

approximately 238 feet of frontage and the appellants' property contains 816 feet of

frontage, or a little over three times as much. Appellee's Ex. 1 and 3 displayed the

configuration differences.

              Ms. Belles also researched the water drainage issue by contacting the

city of Dayton's engineer's office. She was informed that the property did not sit in a

flood plain. Her own visit to the property revealed the creek that exists on the back of

the property. Ms. Belles acknowledged that land existed on both sides of the creek,

but indicated that there is a cleared area that represented about two-and-one-half times

the area used to build the rental building located on the property. From the quantity

of vacant land available and the sales prices obtained for land at and around tax lien

date, Ms. Belles did not believe a reduction in value to the land was warranted.

              Ms. Belles also researched comparable sales and agreed with the

appellants that very few comparable properties had sold within a relevant time period.
Ms. Belles considered sales of rental properties on Shiloh Springs and Golden

Meadow Court, but found neither area comparable to the subject, based upon age of

the construction, and the character of the neighborhood. She agreed that the most

comparable properties to that of the appellants were located on Basore Road, but

commented that adjustments were required because the sale properties were situated

on much smaller plots of land, only one-quarter of an-acre.

             Ms. Belles only generally discussed the comparable sales, apparently

focusing on the sales presented by the appellants at the BOR hearing and attempting

to make some adjustments to the sales prices. She testified that she adjusted the sales

prices of the property at 3591-93 Golden Meadow Court that sold in May 2003 for

$118,000 and adjusted the land values of the auditor's values for the Basore properties

to derive a market value for the subject property of $203,670. She also derived a

value under the income approach of $203,870, utilizing a gross rent multiplier of 110.

Considering both methods of value, Ms. Belles testified that her final conclusion of

value was $204,000.

             We begin our review of this matter by noting that a party who asserts a

right to an increase or decrease in the value of real property has the burden to prove

the right to the value asserted. Cleveland Bd. of Edn. v. Cuyahoga Cty. Bd. of

Revision (1994), 68 Ohio St.3d 336; Crow v. Cuyahoga Cty. Bd. of Revision (1990),

50 Ohio St.3d 55; Mentor Exempted Village Bd. of Edn. v. Lake Cty. Bd. of Revision

(1988), 37 Ohio St.3d 318.       Consequently, it is incumbent upon an appellant
challenging the decision of a board of revision to come forward and offer evidence

which demonstrates its right to the value sought. Cleveland Bd. of Edn., supra;

Springfield Local Bd. of Edn. v. Summit Cty. Bd. of Revision (1994), 68 Ohio St.3d

493. Once an appellant has presented competent and probative evidence of true value,

other parties asserting a different value then have a corresponding burden of providing

sufficient evidence to rebut the appellant's evidence. Springfield Local Bd. of Edn.,

supra; Mentor Exempted Village Bd. of Edn., supra.

              Having noted the appropriate standard of review, we now proceed to

determine the taxable value of the subject property. We first turn to the Ohio Revised

Code for guidance. R.C. 5713.01 provides, in part:

              "The auditor shall assess all the real estate situated in the
              county *** at its true value in money ***."

In determining what constitutes "true value in money," the Supreme Court has held

that the best evidence of a property's fair market value or "true value in money" for

tax purposes is the amount for which the property would sell on the open market

between willing parties. State ex rel. Park Investment Co. v. Bd. of Tax Appeals

(1964), 175 Ohio St. 410; In Re Estate of Sears (1961), 172 Ohio St. 443.

              In other words, for real estate tax purposes, property must be valued at

what that property would sell for in an arm's-length transaction. Walters v. Knox

County Board of Revision (1989), 47 Ohio St.3d 23. However, many times persons

challenging their property's tax valuations are not in the market to sell. In such cases,

Ohio Adm. Code 5703-25-07 provides that "true value in money" may be arrived at
by considering any or all of the three recognized approaches to value: (1) the market-

data approach, in which recent sales of comparable properties are weighed; (2) the

income approach, in which income attributed to a property is capitalized; and (3) the

cost approach, which adds the depreciated cost of the improvements to the land to the

value of the land itself. The three listed methods of valuing property generally reflect

modern appraisal practice.

               We also note that while an owner is entitled to provide an opinion of his

property's worth, to be considered probative such an opinion must be supported with

tangible evidence of a property's value. Smith v. Padgett (1987), 32 Ohio St.3d 344,

347. See, also, Amsdell v. Cuyahoga Cty. Bd. of Revision (1994), 69 Ohio St.3d 572;

Tokles & Son, Inc. v. Midwestern Indem. Co. (1992), 65 Ohio St.3d 621. The weight

to be accorded an owner's evidence is left to the sound discretion of this board.

Cardinal Federal S. & L. Assn. v. Bd. of Revision (1975), 44 Ohio St.2d 13,

paragraphs two and three of the syllabus.

               In the present matter, we find that the appellants have presented an

opinion of value under the sales comparison approach.           They have researched

comparable neighborhoods and presented evidence as to sales of properties they

believe to be comparable to their own. Given the fact that the BOR's witness relied

upon many of the same properties to value the subject property, we agree that the

sales comparables offered to this board provided the best comparables available in the

marketplace.
              The BOR's witness also considered market sales, making adjustments to

those sales for size, quality of construction, comparability of amenities, etc. Such

adjustments, if supported by the market, are reasonable and generally considered.

Unfortunately, the BOR's witness did not support her adjustments through market

evidence. This board is unable to rely upon such adjustments without market support.

              The BOR's witness also opined a value under the income approach to

value. Ordinarily, we would place greater weight upon an opinion of value derived

under this approach. See Ohio Adm. Code 5703-25-07(D)(2), which provides "The

income approach should be used for any type of property where rental income or

income attributed to the real property is a major factor in determining value."

However, we have significant concerns about the BOR's witness' opinion.             The

witness testified that she valued the property utilizing a gross rent multiplier of 110,

but provided no market evidence for that gross rent multiplier. Our calculations using

this gross rent multiplier and the BOR's witness' final conclusion of value under the

income approach of $203,870, indicates a rental rate for the property in the range of

$930 per month, significantly higher than the actual rental rates charged, the rents

indicated for the Shiloh Springs area and the rents obtained by the apartment complex

behind the appellants' property. Thus, we cannot conclude that the BOR's witness

offered a reliable indication of value through the income approach.

              We agree with the appellants the sale most comparable to the subject is

that sale of 320-322 Glenside Court on or about May 2000 for $152,000. The BOR's
witness testified that this property, although smaller than the subject, was of similar

quality of construction. We also find that the sale property is of the same age as the

subject, and is located near the subject property. As such, we find the unadjusted

price is the best evidence of the value of the subject property as of tax lien date.

                 We must account for the difference in land size. We agree with the

BOR's witness that the configuration of the subject property lends itself to further

development. We acknowledge the difficulties with the land itself, but cannot find

that its value has not increased in nearly 10 years. We do not find any of the three

land sales presented by the appellants to be truly comparable to their property. First,

the values presented are auditor's appraised values, not land sales. The BOR was

correct when it explained to the appellants that comparative analyses of the tax

valuation of neighboring properties are not probative of the fair market value of an

individual property because the tax valuations themselves may not be indicative of the

market value of the comparisons. WJJK Investments, Inc. v. Licking Cty. Bd. of

Revision (1996), 76 Ohio St.3d 29; Haydu v. Portage Cty. Bd. of Revision (June 18,

1993), BTA No. 1992-H-576, unreported; Caron v. Hamilton Cty. Bd. of Revision

(Aug. 27, 1993), BTA No. 1992-B-879, unreported.1

                 The most comparable property sold for $152,000. The BOR's witness

testified that a comparable land site should be valued at $25,000. Deducting that


1
  It is for this same reason that we must reject the appellants' argument regarding the reduction in values for
the Glenside properties. This board has no information regarding the reason such properties were reduced.
Moreover, both the 2002 valuations and the 2003 valuations are just that -- auditor's assessments upon which
we cannot rely.
amount from the sale price, a value of $127,000 for the improvements is obtained.

Adding the BOR's land value for the subject property at $68,870, a value of $195,870

is derived. The Board of Tax Appeals finds this to be the value of the subject

property for 2003.

                   Therefore, considering the preponderance of competent and probative

evidence found in the record, this board finds that the correct values of the subject

property as of tax year 2003 are as follows:

Parcel No. H33-5-5-28
                                                True Value      Taxable Value
Land                                             $ 68,870        $ 24,100
Building                                         $ 127,000       $ 44,450
Total                                            $ 195,870       $ 68,550

                   It is the order of the Board of Tax Appeals that the Auditor of

Montgomery County list and assess the subject real property in conformity with this

decision and order.        It is further ordered that this value be carried forward in

accordance with the law.

ohiosearchkeybta