Robert A. Nichols v. Board of Assessors of the Town of Marblehead (February 2, 2009)

COMMONWEALTH OF MASSACHUSETTS
APPELLATE TAX BOARD

ROBERT A. NICHOLS	.		v.	BOARD OF ASSESSORS OF								THE TOWN OF MARBLEHEAD
Docket No. F294439				Promulgated:		 								February 2, 2009							
	This is an appeal originally filed under the informal procedure pursuant to G.L. c. 58A, § 7A and G.L. c. 59, §§ 64 and 65, from the refusal of the appellee Board of Assessors of the Town of Marblehead ("appellee" or "assessors") to abate taxes on certain real estate located in Marblehead owned by and assessed to Robert A. Nichols ("appellant" or "Mr. Nichols") under G.L. c. 59, §§ 11 and 38, for fiscal year 2008.  The appeal was subsequently transferred to the formal procedure at the request of the appellee under G.L. c. 58A, § 7A.  
Commissioner Egan heard the appeal.  Chairman Hammond and Commissioners Scharaffa, Rose, and Mulhern joined her in the decision for the appellee.    
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.  
	Robert A. Nichols, pro se, for the appellant.
	Michael A. Tumulty, assessor, for the appellee. 
 			 	FINDINGS OF FACT AND REPORT
	On the basis of the testimony and exhibits offered into evidence 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 6,000 square-foot parcel of oceanfront real estate located at 3 Kimball Street in Marblehead ("subject property").  The parcel is improved with a Colonial-style, 2,096 square-foot, wood-framed home constructed in 1940.  The home features six rooms, including three bedrooms, as well as two full bathrooms.  Additional features include a two-car garage, three porches, and two decks.  For fiscal year 2008, the assessors valued the subject property at $1,726,500 and assessed a tax thereon, at a rate of $8.34 per $1,000, in the total amount of $14,399.01.   In accordance with G.L. c. 59, § 57C, the appellant timely paid the tax assessed without incurring interest.  
	The appellant timely filed an Application for Abatement with the assessors on January 29, 2008.  The assessors denied the application on February 6, 2008.  On March 25, 2008, the appellant seasonably filed his appeal with the Board.  Based on these facts, the Board found and ruled that it had jurisdiction to hear and decide this appeal.  
	The appellant argued that the subject property was overvalued for fiscal year 2008 because the value attributed to the land - $1,512,000 - represented an excessive increase from previous years.  In support of this argument, the appellant asserted that the rate of increase in the subject property's overall assessment was disproportionate compared to a neighboring property, 2 Kimball Street ("neighboring property"). 
The appellant additionally argued that the subject property was overvalued because the assessors failed to consider the impact of applicable zoning restrictions on its value.  In 1983, the appellant sought to obtain a building permit to make moderate alterations to his home, including slightly extending the deck.  While the Marblehead Zoning Board of Appeals ("Board of Appeals") granted the appellant permission to extend the deck, it denied permission to otherwise enlarge the existing building structure.  The appellant argued that the inability to expand his home negatively impacted the value of the subject property.    
	The appellant introduced into evidence a chart that compared the assessments of the subject property to those of the neighboring property for fiscal years 1992 to 2008.   The chart shows that for all fiscal years from 1992 through 2007, the subject property had a lower assessed value than the neighboring property.  The chart shows that for fiscal year 2008, the subject property increased in assessed value by $453,600 to $1,726,500 while the neighboring property decreased in assessed value by $30,400 to $1,466,200.  Accordingly, for fiscal year 2008, the assessed value of the subject property was $260,300 greater than the assessed value of the neighboring property.      
Evidence entered into the record showed that the neighboring property is located across the street from the subject property and has obstructed water views, but is not an oceanfront property with unobstructed water views, as is the subject property.  The appellant did not account for this difference between the two properties, and the Board found that he failed to establish that the two properties were in fact comparable.  
	The appellant asserted that the fair cash value of the subject property was $1,062,275, which he determined by reviewing properties situated in the vicinity of the subject property, located at 1 Kimball Street and 5 Kimball Street ("1 and 5 Kimball Street").  He noted that zoning ordinances allow for structures of up to 4,200 square feet of living area on the lots at 1 and 5 Kimball Street.  In contrast, the subject property is limited by ordinance to a living area of up to only 2,100 square feet.  The appellant therefore concluded that because the subject property was restricted to having a home with a living area equal to roughly fifty percent of the allowable living areas at 1 and 5 Kimball Street, the fair cash value of the subject property should be fifty percent of the average assessed values of 1 and 5 Kimball Street.  Applying this methodology, the appellant arrived at a fair cash value of $1,062,275 for the subject property.  
The appellant did not offer any other support for the underlying logic or assumptions of this valuation method. Moreover, the appellant provided no evidence that any of the properties on which he based his analysis were in fact comparable to the subject property.     
	In support of their assessment, the assessors introduced the following exhibits: aerial photographs of the subject property; aerial photographs of Kimball Street; a plot plan of the subject property; a zoning map; certain zoning bylaws; various photographs of the subject property; various floor plans of the subject property; a photograph of 4 Kimball Street at the time of its sale in 2005 for $1,631,600 as well as a more current photograph of 4 Kimball Street; various Board of Appeals decisions for properties on Kimball Street; a copy of the 1997 property record card for 5 Kimball Street; a copy of the 2008 property record card for 5 Kimball Street; and the valuation analysis of Michael A. Tumulty, Marblehead's Assistant Assessor, which included photographs of and property record cards for four comparable sales properties.  
	The zoning map and bylaws illustrate that the subject property and the neighboring property are not situated within the same zoning district.  While the subject property resides within the "shoreline expanded single residence" district, the neighboring property resides within the "expanded single residence" district.  Mr. Tumulty's valuation analysis included sales of four comparable properties, all of which have ocean views.  These comparable properties include: 4 Kimball Street in Marblehead ("Sale One"); 8 Bass Rock Lane in Marblehead ("Sale Two"); 13 Goodwin's Court in Marblehead ("Sale Three"); and 172 Front Street in Marblehead ("Sale Four").  
Sale One has an inferior location to the subject property, although the parcel is larger in size.  The home has 2,491 square feet of living area compared to the subject property's 2,008 square feet.  However, this comparable dwelling is much older, has no garage and is in inferior condition to the subject property.  After adjusting the 2005 sale price of $1,631,000 to account for these differences, as well as for time of sale, Mr. Tumulty determined that Sale One indicated a value of $1,754,600 for the subject property.       
Sale Two has a location similar to that of the subject property, although the parcel is larger in size.  The home is smaller than the subject property, with 1,545 square feet of living area.  Both homes were built at the same time, but Sale Two is in slightly inferior condition compared to the subject property.    After adjusting the 2006 sale price of $1,575,000 to account for these differences, Mr. Tumulty determined that Sale 2 indicated a value of $1,641,150 for the subject property.  
Sale Three has a location superior to the subject property, though the parcel is smaller in size.  The home, with 2,089 square feet of living area, is roughly the same size as the subject property but is nearly one-hundred years older.  However, it is in slightly superior condition and has a partially-finished basement as well as two full and one half bathrooms, compared to the subject property's two full bathrooms.  This comparable property does not have a garage.  After adjusting the 2005 sale price of $2,450,000 to account for these factors, as well as the time of sale, Mr. Tumulty determined that Sale Three indicated a value of $2,021,000 for the subject property.  
Sale Four has a similar location, but a slightly larger parcel than the subject property.  The home offers 2,733 square feet of living area.  It was built more recently than the subject property and has a fully-finished basement.  Sale Four has three full and one half bathrooms, compared to the subject property's two full bathrooms.  This comparable property does not have a garage.  After making adjustments to the 2005 sale price of $2,000,000 to account for these differences, Mr. Tumulty concluded that Sale Four indicated a value of $1,717,750 for the subject property.  
Based on a review of these four sales, Mr. Tumulty's final opinion of value for the subject property as of January 1, 2007 was $1,750,000.  
On the basis of all of the evidence, the Board found that the appellant failed to meet his burden of proving that the assessed value of the subject property was greater than its fair cash value.  Further, the Board found that the valuation method employed by the appellee, which was based on properties that the Board found to be comparable to the subject property, yielded the best evidence of the subject property's fair cash value for fiscal year 2008.  
	Accordingly, the Board found and ruled that the appellant did not meet his burden of proving that the subject property was overvalued for fiscal year 2008 and therefore issued a decision for the appellee in this appeal.  
OPINION
Assessors are required to assess real estate at its fair cash value as of the first day of January preceding the fiscal year at issue.  G.L. c. 59, § 38.  The fair cash value of a property is defined as the price upon which a willing buyer and a willing seller would agree if both are fully informed and under no compulsion. Boston Gas Co. v. Assessors of Boston, 334 Mass. 549, 566 (1956).	 
The burden of proof is upon the taxpayer to make out a right to an abatement.  Schlaiker v. Assessors of Great Barrington, 365 Mass. 243, 245 (1974).  The assessment is considered to be valid unless the taxpayer meets its burden and proves otherwise.  Id.  A right to an abatement can be proven by either introducing evidence of fair cash value, or by proving that the assessors erred in their method of valuation.  General Electric Co. v. Assessors of Lynn, 393 Mass. 591, 600 (1984). 
Properties whose assessed values are relied upon must be comparable to the subject property in order to be probative of fair cash value.  Assessors of Lynnfield v. New England Oyster House, Inc., 362 Mass. 696, 703 (1972).  The appellant relied almost entirely upon a comparison of assessed values between the subject property and a neighboring property, and made no adjustment for differences between the two properties.  The Board found that the appellant failed to establish basic comparability between the properties, which the evidence showed to be situated in different districts for assessment purposes.  See Graham v. Assessors of West Tisbury, Mass. ATB Findings of Fact and Reports 2007-321, 398, aff'd 73 Mass. App. Ct. 1107 (2008) (recognizing that the quality and rating of neighborhoods are important considerations in valuing water front properties). 
Moreover, the Board found that data from a single property did not provide a sufficient basis for determining the fair cash value of the subject property.  See Jacobsen v. Board of Assessors of the Town of Concord, Mass. ATB Findings of Fact and Reports, 2008-480, 485-86.  The assessors, on the other hand, offered into evidence recent sales data of comparable properties, and made appropriate adjustments to account for differences.  The Board found the assessors' valuation analysis provided the best evidence of the fair cash value of the subject property.   
	The appellant also argued that the 1983 denial by the Board of Appeals of his application to expand the improvements situated on the subject property should be taken into account in determining the fair cash value of the subject property.  Further, he argued that, because applicable zoning restrictions limit the size of the home on the subject property to approximately half that of two nearby properties, the subject property's assessed value should be an average of the assessed values of those two nearby properties. 
 The appellant offered no supporting evidence to quantify what effect, if any, these zoning restrictions had on value.  First, the appellant failed to prove that the Board of Appeals' denial in 1983 was a permanent bar to modifications to the subject property, or anything more than the denial of a specific request made over twenty-five years ago.  Second, the appellant failed to demonstrate how the limitations on the size of his home, under the zoning bylaws, impacted the fair cash value of the subject property.  The Board was therefore unable to find that the appellant's valuation method, which relied on averaging the fair cash values of two nearby properties which were allowed, under the zoning bylaws, to have homes with larger living areas, yielded a reliable estimate of the fair cash value of the subject property.  
After considering all of the evidence, the Board found and ruled that the appellant did not meet his burden of proving that the subject property was overvalued for fiscal year 2008.  Accordingly, the Board issued a decision for the appellee in this appeal. 
				
				APPELLATE TAX BOARD




			By:								
				Thomas W. Hammond, Jr., Chairman
A true copy,


Attest: 					
		Clerk of the Board

 While this chart does not reference a source, the appellant attributed the contents to Marblehead's official town website.   

ATB 2009-70