Thomas M. Flanagan v. Board of Assessors of the Town of Sterling (June 27, 2007)

COMMONWEALTH OF MASSACHUSETTS
APPELLATE TAX BOARD




THOMAS M. FLANNAGAN			v.	BOARD OF ASSESSORS OF 
THE TOWN OF STERLING

Docket No. F285862				Promulgated:
							June 27, 2007



	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 appellee to abate a tax on real estate assessed under G.L. c. 59, §§ 11 and 38, for fiscal year 2006.
	Commissioner Mulhern heard the appeal and was joined in the decision for the appellee by Chairman Hammond and Commissioners Scharaffa and Rose. 
	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.  

	Thomas M. Flannagan, pro se, for the appellant.
	Harald Scheid, Assessor, for the appellee.


FINDINGS OF FACT AND REPORT
	On January 1, 2005, Thomas M. Flannagan, ("the appellant"), was the assessed owner of a parcel of real estate, improved with a single-family home, located at 15 Adam Taylor Road in the Town of Sterling ("subject property").  For fiscal year 2006, the Board of Assessors of Sterling ("assessors") valued the subject property at $747,800, and assessed a tax, at the rate of $11.59 per thousand, in the amount of $8,667.00.  The appellant timely paid the actual tax due without incurring interest, in accordance with G.L. c. 59, § 57C,.  
On January 9, 2006, in accordance with G.L. c. 59, § 59, the appellant timely filed an application for abatement with the assessors, which the assessors denied on March 27, 2006.  On June 22, 2006, in accordance with G.L. c. 59, §§ 64 and 65, the appellant seasonably filed his appeal with the Appellate Tax Board ("Board").  On the basis of these facts, the Board found and ruled that it had jurisdiction over this appeal.  
	On the basis of all of the evidence submitted at the hearing of this appeal, the Board made the following findings of fact.
The subject property consists of an approximately two-acre parcel of land improved with a wood-frame, modern Colonial-style dwelling, which was constructed in 2004.  The dwelling contains about 2,806 square feet of finished living area and includes four bedrooms plus two full bathrooms and one half bathroom.  The dwelling also contains an unfinished basement/utility area and a two-car garage.  
	The appellant presented a chart, which illustrated per-square-foot assessed valuations of only the building component of properties that he determined to be comparable to the subject property.  These values ranged from a low of $128.26 per square foot to a high of $187.64 per square foot.  The median was $161.46 and the average was $161.71 per square foot.  By way of this analysis, the appellant claimed that his dwelling should be assessed at $161.46 per square foot for the 2,806 square feet of finished living area.
	In addition to his comparable assessment analysis, the appellant also claimed that the assessors' property record card for the subject property was incorrect in three respects:
An area to the rear of the building referenced as "BAS 6x4" on the property record card was a stairway that was incorrectly included in the assessors' calculation of living area.

The owner claimed a 4x8 area in the garage is a stairway as opposed to internal living area.


The area designated as "FOP" on the property record card is not a porch but rather a concrete stoop.

The assessors challenged the claim of overvaluation principally by reliance on the sale price of the subject property, which exceeded the assessed valuation.  The sale of the subject property occurred on June 30, 2004 for a price of $788,000.  
As to the issue of per-square-foot of building value raised by the appellant, the assessor testified that there is a sliding scale for building pricing that usually follows the principle that smaller amounts of square footage are priced higher on a per unit basis than larger amounts of square footage.  
As to the appellant's claims regarding the property record card, the assessors responded as follows:
The assessors conceded that the area designated as "6x4 BAS" on the property record card is in fact a stairway and not living area.  The assessor determined that if this error were corrected on the property record card, the calculation would result in a value reduction of $3,300 for the building component.

The 4x8 area that protrudes into the garage is a mud room that is appropriately treated as living area.
The "FOP" area is a concrete or stone entry that is appropriately valued at $1,600+/-.

Lastly, the assessors presented a "Valuation Defense Summary" in which five sales were presented.  The indicated values from these sales ranged from $731,300 to $790,600 after appropriate adjustment, with an average of $758,100.  The assessors relied on this sales evidence as further evidence of the property's market value.
On the basis of all of the evidence of record, the Board found that the best evidence of value in this appeal was the $788,000 sale price of the subject property paid by the appellant on June 30, 2004, approximately six months before the relevant assessment date.  The sales analysis provided by the assessors further supported the assessed value of $747,800.  Additionally, the Board found credible the assessors' explanation that smaller-sized properties have a higher price per-square-foot value than larger properties.  
Notwithstanding the assessors' admission concerning the stairway at the rear of the building, the evidence of record, particularly the sale price of the subject property and the assessors comparable sales evidence, amply supported the assessed value of the subject property.  Accordingly, the Board found and ruled that the appellant did not meet his burden of proving overvaluation and issued a decision for the appellee in this appeal.  

OPINION
"All property, real and personal, situated within the commonwealth . . . shall be subject to taxation."  G.L. c. 59, § 2.  The assessors are required to assess real estate at its fair cash value determined as of the first day of January of each year.  G.L. c. 59, §§ 2A and 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 appellant has the burden of proving that the subject property has a lower value than that assessed. "'The burden of proof is upon the petitioner to make out its right as [a] matter of law to [an] abatement of the tax.'" Schlaiker v. Assessors of Great Barrington, 365 Mass. 243, 245 (1974) (quoting Judson Freight Forwarding Co. v. Commonwealth, 242 Mass. 47, 55 (1922)). "[T]he [B]oard is entitled to 'presume that the valuation made by the assessors [is] valid unless the taxpayers . . . prov[e] the contrary.'" General Electric Co. v. Assessors of Lynn, 393 Mass. 591, 598 (1984) (quoting Schlaiker, 365 Mass. at 245). 
In appeals before this Board, a taxpayer "may present persuasive evidence of overvaluation either by exposing flaws or errors in the assessors' method of valuation, or by introducing affirmative evidence of value which undermines the assessors' valuation."  General Electric Co., 393 Mass. at 600 (quoting Donlon v. Assessors of Holliston, 389 Mass. 848, 855 (1983)). "A taxpayer may show that its property is overvalued by demonstrating that the assessors relied on inaccurate information contained in their property record cards that improperly increased the value of the subject property."  Kelly v. Board of Assessors of Bedford, Mass. ATB Findings of Fact and Reports 1998-941, 946; see also Olivieri v. Board of Assessors of Egremont, Mass. ATB Findings of Fact and Reports 1998-950, 955; Mason v. Board of Assessors of Lakeville, Mass. ATB Findings of Fact and Reports 1998-558, 566.   
However, a taxpayer does not establish the right to an abatement merely by showing that land or building is overvalued.  "The tax on a parcel of land and the building thereon is one tax . . . although for statistical purposes they may be valued separately."  Assessors of Brookline v. Prudential Insurance Co., 310 Mass. 300, 317 (1941).  In abatement proceedings, "the question is whether the assessment for the parcel of real estate, including both the land and the structures thereon, is excessive.  The component parts, on which that single assessment is laid, are each open to inquiry and revision by the appellate tribunal in reaching the conclusion whether that single assessment is excessive."  Massachusetts General Hospital v. Belmont, 238 Mass. 396, 403 (1921); see also Buckley v. Assessors of Duxbury, Mass. ATB Findings of Fact and Reports 1990-110, 119; Jernegan v. Assessors of Duxbury, Mass. ATB Findings of Fact and Reports 1990-39, 49.  
In the present appeal, the Board found that the appellant failed to prove that the assessed value of his property exceeded its fair cash value as of January 1, 2005.  The appellant presented no evidence as to the value of the property in its entirety, including both his land and building.  Rather, his analysis focused on alleged mistakes by the assessors in measuring and valuing only his dwelling.  This analysis did not support a finding that the assessed value of his overall property, including land and building, exceeded its fair cash value on the relevant assessment date.  . 
In contrast, the Board noted that "[s]ales of property usually furnish strong evidence of market value, provided they are arm's-length transactions and thus fairly represent what a buyer has been willing to pay for the property to a willing seller."  Foxboro Associates v. Board of Assessors of Foxborough, 385 Mass. 679, 682 (1982).  Actual sales of the subject "are very strong evidence of fair market value, for they represent what a buyer has been willing to pay to a seller for [the] particular property [under appeal]."  New Boston Garden Corp. v. Board of Assessors of Boston, 383 Mass. 456, 469 (1981), quoting First Nat'l Stores, Inc. v. Assessors of Somerville, 358 Mass. 554, 560 (1971).   Sales within a reasonable time of the assessment date contain credible information for determining the fair market value of the property at issue.  See McCabe v. Chelsea, 265 Mass. 494, 496 (1920).  The Board found no evidence to indicate that the sale of the subject property was anything but an arm's-length transaction.  Therefore, the Board found and ruled that the purchase price paid was reflective of the property's fair market value on its sale date, just six months prior to the relevant assessment date.  Consequently, the Board found that the subject property's sale price was the best evidence of its fair market value as of the assessment date.   
On this basis, the Board decided this appeal for the appellee.

					     APPELLATE TAX BOARD


				By:	_________________________________
		 			Thomas J. Mulhern, Commissioner



A true copy,


Attest: ______________________________
	    Assistant Clerk of the Board

ATB 2007-608