Vandalia-Butler City School Dist. Bd. of Edn. v. Montgomery Cty. Bd. of Revision - Ohio Supreme Court Opinion - Ohio Supreme Court Decision

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[Cite as Vandalia-Butler City School Dist. Bd. of Edn. v. Montgomery Cty. Bd. of Revision, 106
Ohio St.3d 157, 2005-Ohio-4385.]

BOARD OF EDUCATION OF THE VANDALIA-BUTLER CITY SCHOOL DISTRICT,
APPELLEE, v. MONTGOMERY COUNTY BOARD OF REVISION ET AL., APPELLEES;
TIMBERLAKE L.P., APPELLANT.
[Cite as Vandalia-Butler City School Dist. Bd. of Edn. v. Montgomery Cty. Bd.
of Revision, 106 Ohio St.3d 157, 2005-Ohio-4385.]
Taxation -- Real property -- Valuation -- Burden of proving entitlement to
reduction of value fixed by board of revision lies with party seeking
reduction -- BTA's rejection of board of revision's valuation not
unreasonable, when.
(No. 2004-0343 -- Submitted July 26, 2005 -- Decided September 7, 2005.)
APPEAL from the Board of Tax Appeals, No. 2002-V-1596.
__________________

Per Curiam.
{¶ 1} The appellant, Timberlake L.P., challenges the value assigned to
its real property by the Montgomery County Auditor for tax year 2001. The
property -- identified in the county auditor's records as parcel number B02-006-
01-0063 -- is known as the Timberlake Apartments. A 144-unit apartment
complex constructed in 2000 is on the property, which covers 9.215 acres of land.
{¶ 2} For tax year 2001, the Montgomery County Auditor fixed the true
value of the property at $5,994,310. Timberlake asked the Montgomery County
Board of Revision to reduce that valuation, arguing that the property was worth
only $3,980,000 that year.
{¶ 3} The board of revision determined that the total value of the
property was $4,147,200, which prompted the Board of Education of the
Vandalia-Butler City School District to file an appeal under R.C. 5717.01 with the
Board of Tax Appeals ("BTA"). The board of education urged the BTA to set the

SUPREME COURT OF OHIO
value of the property at the amount originally determined by the county auditor.
The BTA held a hearing and concluded that the county auditor's original
valuation of the property was in fact correct, and the BTA therefore reversed the
decision of the board of revision and directed the county auditor to again set the
value of the property at $5,994,310.
{¶ 4} Timberlake has now appealed to this court. For the reasons that
follow, we affirm the BTA's decision.
{¶ 5} "When cases are appealed from a board of revision to the BTA, the
burden of proof is on the appellant, whether it be a taxpayer or a board of
education, to prove its right to an increase [in] or decrease from the value
determined by the board of revision." Columbus City School Dist. Bd. of Edn. v.
Franklin Cty. Bd. of Revision (2001), 90 Ohio St.3d 564, 566, 740 N.E.2d 276.
And when the BTA is considering testimony and appraisal reports about the value
of property, "the BTA possesses wide discretion in evaluating the weight of the
evidence and the credibility of the witnesses that come before it." Fawn Lake
Apts. v. Cuyahoga Cty. Bd. of Revision (1999), 85 Ohio St.3d 609, 613, 710
N.E.2d 681.
{¶ 6} In this case, the board of education argued before the BTA that the
decision of the board of revision was not supported by any probative, competent
evidence. Timberlake had presented testimony before the board of revision from
a real-property-tax consultant, and the BTA concluded in its opinion that he was
not qualified to offer expert testimony about the property's value.
{¶ 7} At the hearing before the BTA itself, a state-certified real estate
appraiser testified on behalf of Timberlake. That appraiser -- Stephen Ewan --
calculated a value for the property under three different methods: (1) the income-
capitalization approach, which focuses on a property's capacity to generate
income for the owner, (2) the sales-comparison approach, which focuses on the
prices of comparable properties that have changed hands recently, and (3) the cost
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January Term, 2005
approach, which focuses on the cost of replacing the improvements on the
property. Ewan relied on all three valuation methods to reach his final
conclusion, and he appraised the property's value at $4,000,000.
{¶ 8} The BTA found Ewan's opinion unconvincing. The comparable
properties that Ewan examined in appraising the property were nearly 30 years
older than the Timberlake apartment project, and, according to the BTA, Ewan
failed to make "any meaningful adjustments to the sales comparables" to account
for their age. The BTA also described Ewan's cost-approach analysis as
"circular" and characterized his income analysis as "unreliable." Ewan's
appraisal was not "probative" of the property's value, according to the BTA, and
the BTA found no other evidence supporting the board of revision's decision to
reduce the value of the property from the amount originally set by the county
auditor. In the absence of that evidence, the BTA reversed the board of revision's
decision and directed that the auditor's original valuation be restored.
{¶ 9} Timberlake argues in its appeal here that the BTA should not have
ruled in the board of education's favor, given that the board of education was the
appellant before the BTA and presented no witnesses or other evidence at the
BTA hearing. To be sure, the burden of proof rested on the board of education
before the BTA, but "[h]ow a party seeking a change in valuation attempts to
meet its burden of proof * * * is a matter for that party's judgment." Snavely v.
Erie Cty. Bd. of Revision (1997), 78 Ohio St.3d 500, 503, 678 N.E.2d 1373. The
board of education could meet its burden of proof before the BTA by showing --
through cross-examination of Timberlake's appraiser and in a posthearing brief --
that the board of revision had erred when it reduced the value from the amount
first determined by the auditor.
{¶ 10} We have explained that the BTA is entitled to "render its own
independent decision as to the valuation of the property in issue." Cincinnati
Milacron Indus., Inc. v. Brown Cty. Bd. of Revision (1988), 35 Ohio St.3d 32, 33,
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SUPREME COURT OF OHIO
517 N.E.2d 896, citing R.C. 5717.03. "[A] determination of the true value of real
property by a board of revision * * * is not presumptively valid." Amsdell v.
Cuyahoga Cty. Bd. of Revision (1994), 69 Ohio St.3d 572, 574, 635 N.E.2d 11.
{¶ 11} Moreover, the BTA was entitled to reject the testimony that
Timberlake's appraiser offered, for as we have said, the BTA "is not required to
adopt the appraisal methodology espoused by any expert or witness." Hotel
Statler v. Cuyahoga Cty. Bd. of Revision (1997), 79 Ohio St.3d 299, 303, 681
N.E.2d 425. "We will not reverse the BTA's determination on credibility of
witnesses and weight given to their testimony unless we find an abuse of * * *
discretion." Natl. Church Residence v. Licking Cty. Bd. of Revision (1995), 73
Ohio St.3d 397, 398, 653 N.E.2d 240. The BTA's decision in a valuation case
such as this will be undone by this court "only when it affirmatively appears from
the record that such decision is unreasonable or unlawful." Throckmorton v.
Hamilton Cty. Bd. of Revision (1996), 75 Ohio St.3d 227, 229, 661 N.E.2d 1095.
{¶ 12} In the absence of probative evidence supporting the reduction in
value ordered by the board of revision, and in light of the problems identified by
the BTA with the even lower value proposed by the Timberlake appraiser, the
BTA's conclusion that the county auditor's original valuation should be reinstated
was not unreasonable. "In the absence of probative evidence of a lower value," a
county board of revision and the BTA "are justified in fixing the value at the
amount assessed by the county auditor." Salem Med. Arts & Dev. Corp. v.
Columbiana Cty. Bd. of Revision (1998), 82 Ohio St.3d 193, 195, 694 N.E.2d
1324. The BTA's decision to reject the board of revision's valuation and reinstate
the auditor's original finding is supported by the evidence, and the BTA did not
abuse its discretion in reaching that conclusion. The decision of the BTA is
therefore affirmed.
Decision affirmed.
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January Term, 2005

MOYER, C.J., RESNICK, LUNDBERG STRATTON, O'CONNOR, O'DONNELL
and LANZINGER, JJ., concur.

PFEIFER, J., concurs in judgment only.
__________________

Rich, Crites & Wesp, L.L.C., and Mark H. Gillis, for appellee Board of
Education of the Vandalia-Butler City School District.

Wayne E. Petkovic, for appellant.
______________________
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