You believe the county's valuation of your property is too high, so you appeal it to the State Tax Commission. You win.
Feeling pretty good about yourself, you open your next year's valuation notice -- and it's even higher than the previous year's original valuation!Hypothetical? Sadly, no. That scenario has occurred four years running to a local business that contends Salt Lake County is thumbing its nose at the state Tax Commission by ignoring successfully appealed property valuations.
County assessors counter that Tax Commission rulings have limited application.
Discover Financial Services successfully appealed the Salt Lake County's 1995, 1996 and 1997 valuations of its Sandy call center building to the Tax Commission, and is likely to appeal the 1998 valuation. The company's attorney, Steve Young, says county assessors and Board of Equalization hearing officers just keep on valuing the building too high year after year, as if the Tax Commission rulings didn't exist.
Every time the company has appealed the valuation it has won, but it has been forced to spend much time and money doing so.
"I just can't believe the Tax Commission decisions mean nothing," Young said. "It's been going on for years, and it looks like it's going to go on indefinitely."
What's more, County Commissioner Mark Shurtleff says Discover Financial isn't the only one experiencing the problem.
"I've had several calls on the exact same thing," he said.
In 1995 county assessors said Discover's call center was worth $8.8 million. On appeal, the Tax Commission reduced that to $5.6 million. In 1996 the county said the building was worth $9 million -- the Tax Commission again said $5.6 million. In 1997 the county said it was $10.4 million, but the Tax Commission lowered it yet again, to $5.9 million.
Detect a pattern? Discover Financial sure did.
"(The) assessor's office, tax administration office and board of equalization officers are constantly, repeatedly putting personal agendas before common sense and good policy," Discover's tax director Gerald Egner wrote to the County Commission recently. "I thought that two unanimous decisions by the Utah Tax Commission would resolve the matter. Unfortunately, this was not the case."
Last year, 1998, the assessor's office valued the property at $11.5 million. The county's Board of Adjustment lowered that to $8.8 million, but that's still almost $3 million more than the Tax Commission's latest figure.
Assessor division supervisor Tim Noyce explained the philosophy of his office this way: "There are issues that are misinterpreted by the (Tax) Commission. . . . If we disagree with a decision that comes from the Tax Commission, it would behoove us on behalf of the taxpayers (as a whole) to watch out for their interests."
There appears to be some confusion within the county as to whether assessors are required to heed Tax Commission rulings on valuation legal requirements (as opposed to simple application of those requirements).
County deputy attorney Mary Ellen Sloan says the rulings are legal precedent. Noyce says in most cases they're not. Most involved in the process appear to agree with Noyce.
There is also inconsistency in practice. The county has agreed to implement the Tax Commission's Discover Financial valuation ruling of 1995 (the issue that year was one of double taxation) but has refused to implement those of 1996 and 1997. The county -- meaning, in this case, the assessor's office -- has appealed the rulings to 3rd District Court, but Noyce said he doesn't intend to abide by them while the appeal is pending -- a process that will take many months, not to mention more lawyer fees.
The County Board of Adjustment administrative rules contain the following provision:
"Each tax year stands on its own with respect to application procedures. . . . Applications based on a prior or pending appeal to the Board, the State Tax Commission or a court of competent jurisdiction are not sufficient for the current year without additional supporting evidence."
"We give no weight to the Tax Commission," Shurtleff said, disbelieving. "Isn't that weird?"
The County Commission itself sits as the Board of Adjustment, but commissioners themselves rarely do more than rubber stamp the decisions of their hearing officers. In a meeting Monday, Shurtleff said he wanted to have a full-blown hearing with all three commissioners to examine Discover Financial's 1998 valuation but was voted down by commissioners Brent Overson and Mary Callaghan, who reasoned that their decision, no matter what it was, would surely be appealed to the Tax Commission anyway.
That didn't stop Overson, who in the past worked three years in the assessor's office, from speaking his mind about what he believes goes on there.
"It's a bureaucratic screw-up every year," he said. "The assessors are pretty arrogant about it. A taxpayer comes in and points out an error, (and the assessors say) yeah, we screwed up, so what? And they come to the same value some other way."
The assessors counter that it's easy to make them out to be the bad guys, especially for office-holders who stand to reap political benefit by pontificating on behalf of taxpayers.
"We have a fiduciary responsibility that we take very seriously," Noyce said. "Many people think we're out to get the individual, but we treat people fairly and equitably. We are the first ones to recognize an error."