Tammy Bourakis-Nigosian v. Board of Assessors of the Town of Clinton (December 4, 2009)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD


TAMMY BOURAKIS-NIGOSIAN      v.	BOARD OF ASSESSORS OF THE TOWN OF CLINTON                                                  

Docket No. F295976				  Promulgated:
        						  December 4, 2009


This is an appeal filed under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 59, §§ 64 and 65, from the refusal of the Board of Assessors of the Town of Clinton ("appellee" or "assessors"), to abate taxes on certain real estate in the Town of Clinton, owned by and assessed to Tammy Bourakis-Nigosian ("appellant") under G.L. c. 59, §§ 11 and 38 for fiscal year 2008 ("fiscal year at issue").
Commissioner Mulhern heard this appeal.  Chairman Hammond and Commissioners Scharaffa, Egan and Rose joined him in a decision for the appellant. 
	These findings of fact and report are made pursuant to a request by the appellant under G.L. c. 58A, § 13 and 831 CMR 1.32. 

	Tammy Bouraki-Nigosian, pro se, for the appellant.

	Robert B. Gibbons, Esq. and David J. Baird, Chairman of the Board of Assessors, for the appellee.

FINDINGS OF FACT AND REPORT
Based on the evidence and testimony offered at the hearing of this appeal, the Appellate Tax Board ("Board") made the following findings of fact.
On January 1, 2007, the appellant was the assessed owner of a 22,000-square-foot parcel of land improved with an eight-unit, 1970-vintage, garden-style, wood-framed, multi-unit residential building located at 38 Lane Avenue and 40 Winthrop Street in Clinton, Massachusetts ("subject property").  Five of the units at issue contain two bedrooms and one bathroom ("two-bedroom units"), and the other two units at issue contain one bedroom and one bathroom ("one-bedroom units").  All of the units have designated parking.
On January 17, 2007, the appellant converted the subject property from an apartment building to a condominium complex known as Chaudement Condominiums.  Upon converting the apartment building to a condominium complex, the appellant renovated two of the units.  She subsequently sold one of the renovated units on February 23, 2007.  At issue is the fair cash value of the remaining seven units still owned by the appellant at the time of this appeal: one renovated two-bedroom unit and six non-renovated units, four of which were two-bedroom units and two of which were one-bedroom units.
The assessors valued the subject property and assessed a tax thereon at the rate of $11.34 per $1,000 as follows:
Two-bedroom Style Condominium Units	
Unit	Assessed Value	Taxes Assessed	Size	
38B Lane Ave.	$143,800.00 	$1,630.69 	770 square feet	
40B Winthrop St.	$166,000.00 	$1,882.44 	770 square feet	
38C Lane Ave.	$143,800.00 	$1,630.69 	770 square feet	
38D Lane Ave.	$143,800.00 	$1,630.69 	764 square feet	
40C Winthrop St.	$158,600.00 	$1,798.52 	770 square feet*	
One-bedroom Style Condominium Units	
Unit	Assessed Value	Taxes Assessed	Size	
   38A Lane Ave.	$123,200.00 	$1,397.09 	546 square feet	
 40A Winthrop St.	$140,900.00 	$1,597.81 	546 square feet	
* indicates renovated unit	

The appellant paid the taxes due without incurring interest.  On February 1, 2008, the appellant timely filed an abatement application with the assessors, which the assessors denied on March 6, 2008.  On June 4, 2008, the appellant timely filed her Petition under Formal Procedure with the Board.  Based on these facts, the Board found that it had jurisdiction to hear and decide this appeal.
Unrenovated two-bedroom units
The appellant testified that four of the subject two-bedroom units were not renovated.  She submitted into evidence photographs of these units, which depicted basic cabinetry, countertops, appliances, flooring and finishes throughout the units.  The appellant testified, and her photographs revealed, that the four two-bedroom units at issue were very similar in appearance and size.  The First Amendment to Master Deed of Chaudement Condominiums, submitted into evidence by the assessors, indicated that three of the four units had living areas of 770 square feet, while the two-bedroom unit at 38D Lane Avenue had a living area of 764 square feet.  The original Master Deed of Chaudement Condominiums, also submitted by the assessors, indicates that the unit at 40B Winthrop Street was mistakenly listed as being 1,023 square feet in size, instead of 770 square feet.
The appellant advanced a comparable-sales analysis to challenge the subject property's assessment for the fiscal year at issue.  As part of her analysis, she included the property record cards for the sales of four two-bedroom, garden-style condominium units that she considered to be comparable to the subject unrenovated, two-bedroom units in style, size and location.  The four purportedly comparable sales occurred between December 4, 2006 and August 29, 2008 and they indicated a sales range of $101,205 to $129,900.  However, the property record card for one of the purportedly comparable sales indicated that the assessors had classified the sale as "unqualified."  Without consideration of the "unqualified" sale, the sales range was from $118,500 to $129,900.  The appellant also advanced a comparable-assessment analysis, which included the property record card for one purportedly comparable garden-style, two-bedroom condominium unit.  This unit was assessed at $131,000 for the fiscal year at issue.  
The appellant then submitted a table, which summarized the sale prices per square foot and assessed values per square foot of her comparables, along with the assessed values per square foot of the subject units.  She did not make any adjustments to her comparable sales or comparable assessment for variances such as date of sale, location of unit, age of construction, or gross living area.
David J. Baird, the Chairman of the assessors, testified in defense of the subject assessments.  The appellee introduced several exhibits, including the property record cards for the subject properties and a spreadsheet summarizing the assessed values and sales prices for sixteen purportedly comparable two-bedroom condominium units, which occurred during 2007, including 40D Winthrop Street, the renovated two-bedroom unit sold by the appellant.  The sales data provided by the assessors indicated a sales range of $109,000 to $266,000.  The assessed values of these comparable properties ranged from $117,000 to $242,000.  The assessment-to-sales ratio ("ASR") - the ratio between the selling price and assessed value of the property - for the comparable properties provided by the assessors ranged from 0.85 to 1.08.  The mean ASR was 0.96.  Mr. Baird explained that a mean ASR of 0.96 indicates that the assessments of the comparable properties were actually four percent lower than the average sale prices of the subject properties.  Thus, the assessors argued, although there may have been some inconsistencies in the assessments within the subject complex, the assessed values of the subject properties were within the statistical tolerance required by the Department of Revenue.  
Mr. Baird further testified that the appellant's four purportedly comparable sales were in inferior locations, and that three of the sales occurred after the valuation date, including one almost 21 months after the January 1, 2007 valuation date.  The appellant did not dispute Mr. Baird's contention.  The Board found Mr. Baird's testimony on this matter to be credible.

Renovated two-bedroom units
The appellant explained that the units located at 40C and 40D Winthrop Street had been totally renovated.  She submitted pictures detailing new kitchens, complete with new solid maple cabinets, stainless steel appliances and granite counter tops; new bathrooms with ceramic tile; and other high-end features such as sanded hardwood floors, Berber carpet in the bedrooms, bead board wainscoting, and new lighting fixtures.  The renovations also included new patios and landscaping, all surrounded by new PVC fencing.  The appellant testified that the total cost of the renovation was about $37,120 per unit, including about $24,000 in construction costs.  
The assessors cited the sale of Unit 40D Winthrop Street within the complex as an indicator of the value for the remaining renovated unit within the subject property, Unit 40C Winthrop Street.  Unit 40D Winthrop Street sold on February 23, 2007, less than two months after the relevant assessment date, for $159,000.  
Unrenovated one-bedroom units
Neither party submitted sales of one-bedroom units.  The appellant claimed that no sales of one-bedroom condominiums occurred in Clinton, Massachusetts during the relevant time period.  She further testified that she had consulted with area real estate professionals and was told that one-bedroom condominium units generally sell for about $30,000 less than similarly built two-bedroom condominiums.   
On the basis of the evidence and its subsidiary factual findings, the Board made the following ultimate findings of fact.
Unrenovated two-bedroom units
The Board found credible Mr. Baird's testimony that the appellant's four purportedly comparable sales were in inferior locations.  The appellant made no adjustments for differences such as location, time of sale, or other factors that affect a property's valuation and, therefore, assessment.  The Board, therefore, found that the appellant failed to meet her burden of proving that Units 38B, C and D Lane Avenue, the lower-assessed two-bedroom units within the subject properties, were overvalued.
However, the Board found a discrepancy in the assessments between virtually identical units located within the complex.  Units 38B, C and D Lane Avenue were all unrenovated, two-bedroom units with about 770 square feet of living space that were assessed at $143,800.  However, Unit 40B Winthrop Street was assessed at $166,000, despite being nearly identical in size, construction detail, and condition to Units 38B, C and D Lane Avenue.  For this reason, the Board found that the fair cash value of 40B Winthrop Street was $143,800, in line with the assessed value of the other unrenovated, two-bedroom units in the subject property. 
Renovated two-bedroom units 
The Board found that the sale of Unit 40D Winthrop Street within the complex was a persuasive indicator of the value for Unit 40C Winthrop Street, a renovated unit of approximately the same size within the same complex.  Unit 40D Winthrop Street sold on February 23, 2007, less than two months after the relevant assessment date, for $159,000.  The Board thus found that the sale of 40D Winthrop Street for $159,000 supported the assessment of 40C Winthrop Street at $158,600. 
Unrenovated one-bedroom units
Based on the appellant's testimony, which the Board found to be credible, and the photographs which she submitted into evidence, the Board found that Unit 40A Winthrop Avenue, a one-bedroom condominium with 546 square feet was virtually identical with its counterpart, Unit 38A Lane Avenue, a one-bedroom condominium with 546 square feet.  However, while Unit 38A Lane Avenue was assessed at $123,200, Unit 40A Winthrop Avenue was assessed at $140,900.  Accordingly, the Board found that the fair cash value of Unit 40A Winthrop Street was $123,200.
On the basis of these facts, the Board found and ruled that the appellant met her burden of proving that Units 40A and 40B Winthrop Street were overvalued for the fiscal year at issue.  The Board thus abated the real estate taxes in the total amount of $452.47 to reflect the abated values of Units 40A and 40B Winthrop Street.  The Board further found and ruled that the appellant failed to meet her burden of proving that the remaining units were overvalued for the fiscal year at issue.  

OPINION
	"All property, real and personal, situated within the commonwealth . . . shall be subject to taxation."  G.L. c. 59, § 2.  The assessors have a statutory obligation to assess real estate at its fair cash value.  G.L. c. 59, § 38.  Fair cash value is defined as the price on which a willing seller and a willing buyer in a free and open market will agree if both of them are fully informed and under no compulsion.  Boston Gas Co. v. Assessors of Boston, 334 Mass. 549, 566 (1956).  
The taxpayer has the burden of proving that the property has a lower value than that assessed.  Schlaiker v. Assessors of Great Barrington, 365 Mass. 243, 245 (1974).  The Board is entitled to presume that the valuation made by the assessors is valid unless the taxpayer proves to the contrary.  Id. at 245.  The taxpayer must demonstrate that the assessed valuation of its property was improper.  Foxborough Associates v. Board of Assessors of Foxborough, 385 Mass 679, 691 (1982) (citing Schlaiker, 365 Mass. at 245).  The taxpayer may sustain this burden by introducing evidence of fair cash value, or by proving that the assessors erred in their method of evaluation.  General Electric Co. v. Assessors of Lynn, 393 Mass. 591, 600 (1984).  
The three accepted methods of determining fair cash value are comparable sales, depreciated reproduction cost, and capitalization of income.  See Correia v. New Bedford Redevelopment Authority, 375 Mass. 360, 362 (1978).  "The appellant bears the burden of 'establishing the comparability of … properties [used for comparison] to the subject propert[ies].'"  Wood v. Assessors of Fall River, Mass. ATB Findings of Fact and Reports 2008-213, 2008-225 (citation omitted).  Moreover, "[w]hen comparable sales are used, allowances must be made for various factors which would otherwise cause disparity in the comparable prices." Pembroke Industrial Park Co., Inc. v. Assessors of Pembroke, Mass. ATB Findings of Fact and Reports 1998-1072, 1998-1082.  See also New Boston Garden Corp. v. Assessors of Boston, 383 Mass. 456, 470 (1981) ("Once basic comparability is established, it is then necessary to make adjustments for the differences, looking primarily to the relative quality of the properties, to develop a market indicator of value.") 
 In the instant appeal, the Board found that the properties submitted into evidence by the appellant were not comparable to the subject property.  The Board found credible, and the appellant did not dispute, Mr. Baird's testimony that the four comparable sales properties were in inferior locations from that of the subject properties.  Moreover, three of the four purportedly comparable sales occurred after the relevant valuation date, including one almost 21 months after the January 1, 2007 valuation date.  The appellant failed to make any adjustments to her comparable-sales analysis to account for these differences or for any other difference that would impact the subject property's fair market value.  Based upon the testimony of Mr. Baird and the other evidence of record, the Board found and ruled that the appellant failed to meet her burden of proving that the unrenovated two-bedroom units at 38B, C and D Lane Avenue were overvalued for the fiscal year at issue.
As for the assessment of the renovated two-bedroom condominium, the Board found that the sale price of Unit 40D Winthrop Street was a reliable indicator of the fair market value of Unit 40C Winthrop Street.  Unit 40D Winthrop Street was sold on February 23, 2007, less than two months after the relevant valuation date, for $159,000.  The sale price of 40D Winthrop Street amply supported the assessed value of 40C Winthrop Street of $158,600.  Based on this evidence, the Board found and ruled that the appellant failed to meet her burden of proving that Unit 40C was overvalued for the fiscal year at issue.  
	However, based on the evidence of record, including appellant's credible testimony, photographs and property record cards, the Board found that the unrenovated two-bedroom unit at 40B Winthrop Street was overvalued.  Unit 38B Lane Avenue, Unit 38C Lane Avenue, and Unit 38D Lane Avenue all contained about 770 square feet, were unrenovated and were assessed at $143,800.  However, Unit 40B Winthrop Street was assessed at $166,000, despite being virtually identical to Units 38B, 38C, and 38D Lane Avenue.  All four of the units were nearly the same size, in the same condition, and offered the same parking and amenities.  Similarly, the Board found that Unit 38A Lane Avenue and Unit 40A Winthrop Street were virtually identical based on the appellant's credible testimony and other evidence of record.  However, Unit 38A Lane Avenue was assessed at $123,400, while Unit 40A Winthrop Street was assessed at $140,900.  
General Laws c. 58A, § 12B provides in pertinent part that "at any hearing relative to the assessed fair cash valuation or classification of property, evidence as to fair cash valuation or classification of property at which assessors have assessed other property of a comparable nature or class shall be admissible."  "The introduction of ample and substantial evidence in this regard may provide adequate support for abatement."  Chouinard v. Assessors of Natick, Mass. ATB Findings of Fact and Reports 1998-299, 307-308 (citing Garvey v. Assessors of West Newbury, Mass. ATB Findings of Fact and Reports 1995-129, 135-36; Swartz v. Assessors of Tisbury, Mass. ATB Findings of Fact and Reports 1993-271, 279-80); see Turner v. Assessors of Natick, Mass. ATB Findings of Fact and Reports 1998-309, 317-18.  In the present appeal, appellant submitted ample credible evidence of comparable assessments.  The Board therefore found and ruled that the fair cash value of Unit 40B Winthrop Street was $143,800, in line with the assessments of the nearly identical units in the complex, and that the fair cash value of Unit 40A Winthrop Street was $123,200, in line with the assessment of the nearly identical Unit 38A Lane Avenue.  The Board thus granted corresponding abatements.  
Accordingly, the Board issued a decision in favor of the appellant abating the real estate taxes on the subject property in the total amount of $452.47.

    	    		   APPELLATE TAX BOARD

				By:				______	undefinedundefined_____
				   Thomas W. Hammond, Jr., Chairman



A true copy,


Attest:	______		_____
	    Clerk of the Board

  Although the seven units were assessed separately, the appellant filed one abatement application with the assessors.
  The property record card does not indicate the reason for the sale's disqualification.
  Unit 40D Winthrop Street, which contained 764 square feet of living space, is actually slightly smaller than Unit 40C Winthrop Street, which contained 770 square feet of living space.

ATB 2009-1160