Scott and Dawn Hagedorn v MDOR

BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN,
Appellants,
V.
STATE OF MONTANA,
DEPARTMENT OF REVENUE,
Respondent.
CASE :PT-2026-10
FINDINGS OF FACT,
CONCLUSIONS OF LAW, ORDER,
AND OPPORTUNITY FOR
JUDICIAL REVIEW
AUG 19 2026
Montana Tax Appea! Board
STATEMENT OF THE CASE
This is an appeal of a final decision by the Madison County Tax Appeal Board
(CTAB) denying Scott and Dawn Hagedom (Taxpayers) a reduction in value on the
subject property identified by geocode of 25-0784-29-3-04-01-0000, located near Twin
Bridges, Montana (Subject Property). The Taxpayers appealed that outcome to the
Montana Tax Appeal Board (MTAB) on February 19, 2026. Appeals PT-2026-5, PT-
2026-10, and PT-2026-11 involve the same Taxpayers and were heard on the same
record. This decision only addresses PT-2026-10. However, the Board took judicial
notice of foundational information related to all three cases for judicial efficiency. The
Board affinns the CTAB's determination.
ISSUE TO BE DECIDED
Whether the CTAB erred in denying the Taxpayers' request for a value reduction
on the Subject Property.
EXHIBIT LIST
The following evidence was submitted at the hearing:
Taxpayers' Exhibits:
1. Withdrawn;
2. Withdrawn;
3. CTAB Hearing Determinations - PT-2026-10 and PT-2026-11;
4. Multi-Parcel Exclusion and Ignored Comparable Sales;
5. Land Model Inequality - PT-2026-10 and PT-2026-11;
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
6. Overvaluation Evidence Package - PT-2026-10 and PT-2026-11;
7. CTAB Attachments - PT-2026-10 and PT-2026-11;
8. Nearby Comparable Sales - Rochester Road and Rochester Basin;
9. Department Supplemental Discovery - Refused Requests and
Contradictions;
10. Department Supplemental Discovery Response Email, dated May 7,
2026;
11. Photograph of Department Document Production Box;
12. Withheld Communications and Privilege Logs;
13. Bob Finstad - Undisclosed Department Participant;
14. Mark Wood - Department Appraiser; and
15. Aerial Maps of Comparable Properties.
Department's Exhibits:
A. Land Model;
B. Property Record Card; and
C. AB-26 Determination Letter.
PROCEDURAL HISTORY
The Department of Revenue (Department) valued the Subject Property at
$46,548 for the 2025-2026 appraisal cycle. Ex. B; MTAB Hr'g Tr. 108:16-18. The
Taxpayers filed an AB-26 Request for Informal Classification and Appraisal Review
with the Department, and the Department issued a Form AB-26 Determination Letter
on November 26, 2025, making no change to the $46,548 appraised value. Ex. C. The
Taxpayers appealed the Department's determination to CTAB on December 23, 2025.
MTAB Dkt. 3. The CTAB hearing was held on January 16, 2026, and the CTAB's
decision denying the Taxpayers' requested reduction was sent to the parties on January
16, 2026. MTAB Dkt. 3; MTAB Hr 'g Tr. 108:22-23. The Taxpayers appealed to MTAB
on February 19, 2026, per Mont. Code Ann. § 15-2-301, requesting a total value of
$22,500. MTABDkt. 1; MTAB Hr'g Tr. 108:19-21. The MTAB hearing was conducted
in Helena on May 21, 2026, at which the following were present:
a. Dawn Hagedom, Taxpayer; and
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORNv. STATE OF MONTANA, DEPARTMENT OF REVENUE
b. Dave Burleigh, Department Counsel; Michele Peterson-Cook,
Department Counsel; Kandy Fleurisma, Paralegal; Tina Oliver, Area
Manager; and Katelyn Thomton, Modeler.
The record includes all materials submitted to CTAB, a recording of the CTAB
hearing, all materials submitted to MTAB with the appeal, additional exhibits submitted
by the parties prior to and at the MTAB hearing, and a transcript of the MTAB hearing.
FINDINGS OF FACT
1. To whatever extent the following findings of fact may be construed as
conclusions of law, they are incorporated accordingly.
2. The Subject Property is a vacant parcel owned by Scott and Dawn Hagedom.
Ex. B. The Subject Property is located in Section 29, Township 02 South,
Range 07 West, near Twin Bridges, Montana, and is also identified by its
assigned geocode 25-0784-29-3-04-01-0000. Id. The Subject Property is 9.630
acres in total size and contains no improvements. Id.
3. The Department appraised the Subject Property's total value at $46,548 for the
2025-2026 appraisal cycle. Ex. B; MTAB Hr 'g Tr. 109:9-10. During the AB-26
informal review, the Department conducted an off-site record review because
the Taxpayers did not consent to photographs being taken of the Subject
Property. Ex. C; MTAB Dkt. 3. After conducting the review, the Department
made no change to the Subject Property's value. Ex. C. The Taxpayers
appealed the Department's valuation to CTAB on December 23, 2025. MTAB
Dkt. 3. The CTAB hearing was held on January 16, 2026, and the CTAB
denied the Taxpayers' request and upheld the Department's value of $46,548.
MTAB Dkt. 3; MTAB Hr 'g Tr. 108:22-23. The Taxpayers appealed to MTAB
on February 19, 2026, and asserted that the total value of the Subject Property
should be $22,500. MTAB Dkt. 1. The Department maintains that the correct
value for the Subject Property is $46,548. MTAB Hr'g Tr. 108:16-18.
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
4. Ms. Hagedom testified that she previously worked in real estate and conducted
market analyses for clients. MTAB Hr'g Tr. 179:12-13. Ms. Hagedorn
acknowledged that she has no prior experience as a fee appraiser. MTAB Hr 'g
Tr. 176:16-21,179:12-13.
5. Ms. Hagedorn asserted that the Department has withheld large amounts ofnon-
privileged communications. MTAB Hr'g Tr. 24:8-25:6. Ms. Hagedorn argued
that the withheld communications cannot all be privileged stating, "So are we
supposed to believe that that's the only time they ever talked about our
property between two staff members that weren't legal counsel?" MTAB Hr'g
Tr. 24:8-14. Ms. Hagedom also stated, "It seems to me like there's a lot of
withheld staff to staff communications, but how would I know?" Id.
6. Ms. Hagedom testified that the two Department employees. Bob Finstad and
Mark Wood, were undisclosed participants in the review process and notice of
their participation was improperly withheld during the discovery process. Ex.
13, 14; MTAB Hr'g Tr. 25:7-27:2.
7. Ms. Hagedom argues that the Department raised the total value of the Subject
Property from $19,209 in 2024 to $46,548 in 2025, which is a 142% increase in
the total value. MTAB Hr'g Tr. 109:8-11. Ms. Hagedom noted that this
represents an increase of more than two and a half times the value between
2024 and 2025. Id. Ms. Hagedom contends that the Department incorrectly
used the cost approach rather than the sales comparison approach to value the
Subject Property. MTAB Hr'g Tr. 109:12-18. Ms. Hagedom stated that her
argument is based on the Department's provided appraisal methodology, which
describes the sales-comparison approach as the Department's primary land-
valuation method and preferred method for residential property. Ex. 6; MTAB
Hr'gTr, 117:6-7.
8. Ms. Hagedom asserts that most sales in the Department's land model are
distant from the Subject Property and are subdivision lots with additional
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DA WN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
amenities such as access to electricity. MTAB Hr'g Tr. 109:23-24. Ms.
Hagedom added that the sales prices of the properties are trending between
$10,000 and $15,000 per acre, which she argues makes them incomparable to
the Subject Property. MTAB Hr 'g Tr. 110:2-4. Ms. Hagedom further testified
that the Subject Property is more than 13 miles from the nearest electrical or
landline service. MTAB Hr'g Tr. 111:1-2.
9. Ms. Hagedom argued that a market-supported increase from 2024 to 2025 for
the Subject Property would have been between 15% and 20%, rather than
142%. MTAB Hr'g Tr. 112:9-10.
10. Ms. Hagedom asserted that the per acre value of the Subject Property is
disproportionately high compared to nearby sales. Ex. 8; MTAB Hr 'g Tr.
111:16-25. Ms. Hagedorn provided a list of six nearby sales to the Department
that she contends are more comparable to the Subject Property than the sales
used by the Department. Ex. 8; MTAB Hr'g Tr. Ill: 16-25. Five of the six
Taxpayer-provided sales occurred before the January 1, 2024, lien date, and
one occurred after. Ex. 8; MTAB Hr'g Tr. 111:16-23. Ms. Hagedom calculated
an average price of $2,191 per acre for the five pre-lien-date sales. Ex. 8;
MTAB Hr'g Tr. 111:16-23. Including the post-lien-date sale, the calculated
average is $2,366 per acre. Ex. 8; MTAB Hr'g Tr. 111:16-23. Ms. Hagedom
asserts that both averages are well below the Subject Property's average per
acre value of $4,833, indicating an unreliable value. Ex. 8; MTAB Hr'g Tr.
111:16-112:12. The Department included one of Ms. Hagedom's provided
sales in the land model but excluded the remaining sales because two involved
multi-parcel sales, two exceeded the Department's acreage limit, and one
occurred after the lien date. MTAB Hr'g Tr. 111:24-112:2, 146:4-20, 147:17-
148:3.
11. Department Area Manager, Tina Oliver, testified that the Department used a
multiplicative land model to value the Subject Property. Ex. A; MTAB Hr'g Tr.
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
53:6-15. The Subject Property is included in Department neighborhood
225.001 which encompasses the Rochester Road area. Ex. A. Within the land
model, Rochester Road properties receive Category 1 pricing based on two
sales from that area. Ex. A; MTAB Hr'g Tr. 53:6-15. Category 1 establishes a
one-acre base value of approximately $17,585, which is 41% of the model's
$42,471 standard base rate. Ex. A; MTAB Hr'g Tr. 53:6-15. The model's base
size is one acre, and the standard base rate represents the modeled value for one
uninfluenced acre. Ex. A; MTAB Hr'g Tr. 53:6-20, 182:6-183:3. Ms. Oliver
explained that the Department utilizes influences and category pricing to
account for differences in parcel characteristics. MTAB Hr 'g Tr. 185:23-25.
Ms. Oliver confirmed that the 41% influence factor for the Category 1 land
type is based on the location and amenities available to the Subject Property,
which is supported by market data. MTAB Hr 'g Tr. 186:1-7.
12. Ms. Oliver testified that the formula for the multiplicative land model the
Department used is Y = B(X / K)M, where Y is the market value, B is the
applicable base rate, X is the Subject Property size, K is the model's base size,
and M is the incremental rate. Ex. A; MTAB Hr'g Tr. 136:23-137:21. The
Category 1 base rate is $17,585, the Subject Property's size is 9.630 acres, the
land model's base size is 1 acre, and the incremental rate for the land model is
0.43. Ex. A, B; MTAB Hr'g Tr. 137:20-21, 139:21-22, 140:1-3. Ms. Oliver
testified that inputting these values into the formula produces an appraised
value of $46,548 for the Subject Property. MTAB Hr'g Tr. 140:8-12.
13. Ms. Oliver explained that the incremental rate adjusts value based on the
additional acres beyond the first base acre. MTAB Hr 'g Tr. 140:4-7. Moreover,
Ms. Oliver stated that the 41% influence factor indicates that the Category 1
land type's base rate is 41% of the land model's base rate. Ex. A; MTAB Hr'g
Tr. 138:19-24.
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
14. Ms. Oliver testified that the Subject Property's land value increased from
$19,209 in the 2024 tax cycle to $46,548 in the 2025-2026 tax cycle due to
market appreciation reflected in the sales used to develop the land model.
MTAB Hr'g Tr. 141:20-22. Ms. Oliver further stated that, in her experience, the
Department does not appraise land by applying a price-per-acre methodology.
MTABHr'gTr. 143:7-9.
15. Ms. Oliver testified on cross-examination that only one of Ms. Hagedom's six
proposed comparable sales was included in the land model. MTAB Hr'g Tr.
147:24-148:3. The Best Shot property sold for $39,900 in June of 2022 and
was time-adjusted to the January 1, 2024, lien date. MTAB Hr 'g Tr. 147:24-
148:3. Ms. Oliver testified that the Taxpayers' five remaining provided sales
do not qualify as comparables to the Subject Property for various reasons.
MTAB Hr'g Tr. 146:10-11. Two of the sales exceeded 25 acres in size and
parcels greater than 25 acres are not used in the Department's land models
according to policy. Ex. 6, Ex. 8; MTAB Hr'g Tr. 147:19-24. Two other sales
were excluded due to being multi-parcel transactions. Ex. 6, Ex. 8; MTAB Hr'g
Tr. 146:13-147:10. The Department excluded those sales because the parcels
were conveyed together under one warranty deed and realty transfer certificate,
preventing the Department from being able to determine the value attributable
to each parcel. Ex. 6, Ex. 8; MTAB Hr'g Tr. 146:13-147:10. The remaining sale
occurred after the January 1, 2024, lien date and was therefore not included in
the Department's land model for the 2025-2026 appraisal cycle. Ex. 6, Ex. 8;
MTABHr'gTr. 149:4-8.
16. Ms. Oliver testified on cross-examination that the sales in the land model are
comparable to the Subject Property because they have a direct impact on the
Rochester area market. MTAB Hr 'g Tr. 150:8-17. Ms. Oliver further testified
that the Department needs sales to create the land model and the sales in the
Rochester Road area act as the foundation needed to create the influenced base
rate used to value the Subject Property. Id.
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
17. Ms. Oliver testified that Mark Wood performed the Subject Property's AB-26
informal review but is no longer employed by the Department. MTAB Hr 'g Tr.
49:18-50:2.
18. Ms. Oliver testified that Bob Finstad is employed by the Montana State
Information Technology Services Division, and his only involvement with the
informal review was to verify when pictures would be removed from the
Department's internal systems pursuant to the Taxpayers' request. MTAB Hr'g
Tr. 51:11-16.
19. Department Modeler, Kate lyn Thomton, testified that the Department uses the
cost approach for all vacant land. MTAB Hr'g Tr. 155:24. Ms. Thomton
clarified that while the cost approach is the stated method used to value the
Subject Property, land models determine land value by comparing sales similar
to market modeling. MTAB Hr'g Tr. 158:8-12. Ms. Thomton stated that it is
the Department's general practice to exclude multi-sale properties and
properties over 25 acres from the land model. MTAB Hr'g Tr. 156:6-18.
20. Ms. Thomton testified that the Department utilizes multiple statistical checks to
ensure the accuracy of its land models, including the coefficient of dispersion
(COD), coefficient of variation (COV), R-squared value, and t-stat. Ex. A;
MTAB Hr'g Tr. 91:6-12. The COD is based on the average absolute deviation
of the data and a COD between five and fifteen percent indicates good
appraisal uniformity, meaning that there are no major outliers skewing the data.
Ex. A; MTAB Hr'g Tr. 91:18-24. The CO V is based on the ratio of the standard
deviation from the mean and a COV of less than twenty is preferred. Ex. A;
MTAB Hr'g Tr. 92:1-17. The R-squared value indicates how well a regression
model fits the data and a value closer to 1.00 is preferred. Ex. A; MTAB Hr'g
Tr. 92:1-17. The t-stat is a ratio that conveys whether the difference between
two sample means occurred by chance and a t-stat higher than two or lower
than negative two is preferred. Ex. A; MTAB Hr'g Tr. 92:1-17. For the Subject
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
Property's land model, the COD is 9.27, the COV is 12.81, the R-squared value
is 0.96, and the t-stat is -7.33, all of which are within the desired range and
indicate a reliable and accurate land model. Ex. A; MTAB Hr 'g Tr. 91:20-93:3.
Ms. Thornton stated that the t-stat of-7.33 indicates that the Subject Property's
Rochester Road area differs from the model's baseline statistically, and that the
difference is unlikely to have occurred by chance. MTAB Hr'g Tr. 196:1-5.
JURISDICTION AND STANDARD OF REVIEW
21. The Montana Tax Appeal Board is an independent agency not affiliated with
the Montana Department of Revenue. Mont. Const., Art. VIII § 7; Mont. Code
Ann. § 15-2-101. The Taxpayers filed a timely appeal of the CTAB's decision
to the MTAB. Therefore, this Board maintains jurisdiction to hear and decide
this matter. Mont. Code Ann. § 15-2-301.
22. When reviewing a county tax appeal board decision under Mont. Code Ann. §
15-2-301, ]S/[TAB acts as a quasi-appellate body with authority to supplement
the record and is limited to issues properly preserved for appellate review.
O'Brien v. Mont. Dep 't of Revenue, 2026 MT 132, ^ 72.
23. The Board's order is final and binding upon all parties unless changed by
judicial review. Mont. Code Ann. § 15-2-301(6).
CONCLUSIONS OF LAW
24. To whatever extent the following conclusions of law may be construed as
findings of fact, they are incorporated accordingly.
25. "All taxable property must be appraised at 100% of its market value...." Mont.
Code Ann. § 15-8-111.
26. "[1]n connection with any appeal under [Mont. Code Aim. § 15-2-301], the
Montana board is not bound by common law and statutory rules of evidence or
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
rules of discovery and may affirm, reverse, or modify any decision. To the
extent that this section is in conflict with the Montana Administrative
Procedure Act, this section supersedes that act." Mont. Code Ann. § 15-2-
301(5).
27. DOR is entitled to a "presumption of correctness if its decisions are pursuant to
an administrative rule or regulation, and the rule or regulation is not arbitrary,
capricious or otherwise unlawful." Burlington N., 169 Mont. at 214, 545 P.2d
at 1090. However, DOR cannot rely entirely on the presumption in its favor
and must present a modicum of evidence showing the propriety of their action.
Western Air Lines v. Michunovich, 149 Mont. 347, 353, 428 P.2d 3, 7 (1967).
28. The Taxpayer bears the burden of proving the error of DOR'S decision.
Farmers Union Cent. Exch. v. Dep't of Revenue, 272 Mont. 471, 476, 901 P.2d
561, 564 (1995); Western Air Lines, 149 Mont. at 353, 428 P.2d at 7.
29. '"Assessment formulations' by [the Montana Tax Appeal Board] should be
upheld unless there is a clear showing of an abuse of discretion." Peretti v.
Dep't of Revenue, 2016 MT 105, ^ 15, 383 Mont. 340, 344, 372 P.3d 447, 450
(citing 0 We;// v. Dep't of Revenue, 2002 MT 130, ^ 23, 310 Mont. 148, 155,
49 P.3d 43, 47); see Northwest Land & Dev. v. State Tax Appeal Bd., 203
Mont. 313, 317, 661 P.2d 44, 47 (1983).
30. "When faced with a problem of statutory construction great deference must be
shown to the interpretation given the statute by the officers or agency charged
with its administration." Dep 't of Revenue v. Puget Sound Power & Light Co.,
179 Mont. 255, 262, 587 P.2d 1282, 1286 (1978) (citing Udall v. Tollman, 380
U.S. 1,16(1965)).
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
31. "[T]ax statutes are to be strictly construed against the taxing authority and in
favor of the taxpayer." Western Energy Co. v. Dep't of Revenue, 1999 MT 289,
If 10, 297 Mont. 55, 58, 990 P.2d 767, 769.
32. The Legislature intended the Department to utilize a number of different
approaches or combination of approaches, including the income approach,
sales comparison approach, and cost less depreciation approach, depending on
the market where the appraisals take place, when it assesses property and
estimates market value. Albright v. State, 281 Mont. 196, 208-09, 933 P.2d
815, 823 (1997).
DISCUSSION
33. The Taxpayers argue that the Subject Property's appraised value of $46,548 for
the 2025-2026 appraisal cycle is excessive and assert that a value of $22,500
more accurately reflects the market value. The Taxpayers allege a number of
deficiencies in the Department's valuation of the Subject Property. The
Taxpayers argue that the Department improperly used the cost approach rather
than the sales comparison approach to value the Subject Property, excluded
relevant nearby sales from the land model, utilized incomparable subdivision
lots in the land model, and did not adjust sales in the land model for factors
such as access disparity and distance from the Subject Property.
34. The Department maintains that the correct appraised value for the Subject
Property is $46,548 and the appraisal conforms to industry standards. The
Department contends that the cost approach was the correct valuation method
to use when valuing the Subject Property due to it being vacant land. The
Department explained that the Taxpayers' proposed comparable properties
were excluded because they involved multi-parcel sales, sold after the lien date,
or exceeded the Department's acreage limit. Lastly, the Department defends the
sales contained in the land model and argues that the sales were properly
adjusted and reflect accurate market value.
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORNv. STATE OF MONTANA, DEPARTMENT OF REVENUE
35. We first address the Taxpayers' dispute regarding the Department's valuation
method. The Subject Property contains no improvements and is classified as
vacant land, facts which neither party disputes. Although the parcel falls within
the Department's residential classification, it does not contain a residence or
other residential improvements. The information provided by the Department
to the Taxpayer states that, for residential property, "The sales comparison
approach is the preferred valuation method." The same document also states,
"In addition to vacant land, the cost approach is used for parcels with non-
typical circumstances and when there are insufficient sales data and reliable
market models cannot be developed state-wide by the department." This
language is not permissive but instead requires that vacant land be valued using
the cost approach. Ms. Thomton clarified, however, that land models are
developed from verified land sales. Ms. Thornton described the model as
technically employing a sales-comparison methodology because it uses sales to
estimate raw land value, even though the Department's system values vacant
land under the cost approach. Accordingly, while the cost approach designation'
is potentially misleading, it does not establish that the Department applied an
improper valuation methodology. Wetherefore find that the Department did
not err by valuing the Subject Property using the cost approach.
36. Next, the Taxpayers argue that the Department improperly excluded relevant
comparable properties from its land model. Ms. Hagedorn presented six
proposed comparable properties that are closer in proximity to the Subject
Property and that she argues are more comparable than the sales used by the
Department. The average per acre value of the six proposed comparable
properties is $2,366, which is significantly less than the Subject Property's
average per acre value of $4,833. Ms. Hagedom contends that including her
proposed comparable sales in the land model would result in a more accurate
market value for the Subject Property.
37. Ms. Oliver addressed the Taxpayers' proposed comparable properties during
cross-examination and explained the various reasons why five of the properties
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
were excluded from the land model. Ms. Oliver stated that two of the proposed
comparable properties, referred to as Big Rock Mine Sur and Independence
Mine Sur, were excluded due to being multi-parcel sales. The Department
excludes multi-parcel sales from its land models because the amount of value
that should be apportioned to each parcel cannot be accurately determined. The
New Year's Gift and Giltrap Subdivision Lot 4B properties were excluded
from the land model for being too large. Ms. Oliver testified that Department
procedure prevents properties greater than 25 acres in total size from being
included in land models, and the two proposed comparable properties are 49.89
and 90.13 acres, respectively. The final proposed comparable property that was
excluded from the land model, referred to as Carrie B Sur, was not included
because it sold on July 30, 2024, months after the lien date of January 1, 2024.
Ms. Oliver stated that the Taxpayers' proposed comparable property referred to
as Best Shot was included in the Department's land model. The property sold
on June 27, 2022, requiring the Department to time trend the value to match the
lien date of January 1, 2024, resulting in its sale price of $39,900 being
adjusted to $46,206. The Board finds that Ms. Oliver gave credible testimony
explaining why five of the proposed comparable properties were excluded from
the land model, and that the Department correctly followed appraisal procedure
in determining which properties to include in the land model.
38. Lastly, the Taxpayers argue that the Department failed to adjust sales used in
the land model for differences in access, utilities, and distance from the Subject
Property. The Taxpayers also challenge the model's use of subdivision lots
located closer to Twin Bridges in valuing the Subject Property. While
subdivision lots were included in the land model, they were used to determine
the base rate of the land model. The base rate for the Subject Property's
Category 1 land type did not incorporate subdivision lots and was instead
determined using two sales which were also located in the Rochester Road
area. The Category 1 land type used to value the Subject Property has a 41%
influence factor, meaning the properties in that land type are valued at 41% of
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
the base rate. Ms. Oliver explained that the Department utilizes influences and
category pricing to account for the different characteristics of a parcel. Ms.
Oliver confirmed that the 41% influence factor for the Category 1 land type is
based on the-market data reflecting the location and amenities available to the
Subject Property. Applying the Category 1 influence factor resulted in a
reduction in value that the Board believes accurately accounts for the disparity
between the Subject Property and other properties contained within the land
model.
39. Ultimately, the Taxpayers have not overcome the burden of proving that the
Department made an error in valuing the Subject Property. The record before
the Board indicates that the Department followed proper mass appraisal
procedure in valuing the Subject Property. The Department appropriately
valued the vacant Subject Property using verified vacant-land sales and making
adjustments for location and parcel size. Additionally, the Department followed
procedure in excluding multi-parcel sales, sales of property over 25 acres, and
sales that occurred after the lien date from the land model. The Department also
accounted for differences between the Subject Property and other properties
within the land model by applying an influence factor that took into account
location and differences in amenities. Therefore, the Board upholds the
Department' s value.
40. The Taxpayers also made two discovery-related claims. First, the Taxpayers
allege that the Department improperly withheld portions ofnon-privileged '
communications. Second, the Taxpayers argue that the participation of two
Department employees. Bob Finstad and Mark Wood, was not properly
disclosed.
41. Regarding the first discovery-related claim, Ms. Hagedorn testified that the
Department supplied only one written internal communication and alleges that
numerous pages of non-privileged communications were withheld. Ms.
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BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
Hagedom argued that the withheld communications cannot all be privileged,
.stating, "So are we supposed to believe that that's the only time they ever
talked about our property between two staff members that weren't legal
counsel?" Ms. Hagedorn also stated, "It seems to me like there's a lot of
withheld staff to staff communications, but how would I know?"
42. The Department maintains that all non-privileged communications were
disclosed. In its supplemental responses, the Department explained that the
privilege log contains 150 pages that were provided but partially redacted, and
652 pages of completely withheld communications. The Department clarified
that all withheld communications were between Department staff and legal
staff, and in all instances the legal staff were communicating in anticipation of
litigation. The Department stated that in each case, the privilege claims
constitute either attomey-client privilege or work-product privilege.
Department Counsel also emphasized that it is extremely inefficient to have
written dociunentation for every communication, and most conversations
happen informally face-to-face.
43. The Taxpayers have not provided evidence supporting their contention that the
Department withheld non-privileged communications beyond their belief that
such withholdings occurred. In comparison, the Department provided sufficient
explanation for the withheld materials and explained why the communications
constitute attomey-client or work-product privilege. Therefore, the Board does
not believe the Taxpayers have shown that the Department improperly withheld
non-privileged communications.
44. Regarding the second discovery-related claim, the Taxpayers argue that Mr.
Finstad's participation was improperly withheld from the Department's initial
discovery responses and was only disclosed in the Department's supplemental
discovery responses. The Taxpayers also contend that Mr. Wood was
improperly omitted from the Department's initial discovery responses and was
only referred to as a "former staff member." The Department maintains that its
15

BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
discovery responses were properly responsive to the Taxpayers' specific
information requests.
45. The Board does not find any error in the Department's discovery responses. As
the Department noted in its supplemental response email, the Taxpayers' first
interrogatory asked the Department to identify "each person at the Department"
who has knowledge or was involved in the appraisal process. The phrase "at
the Department" makes the request specific to current employees and is
narrower in scope than a request broadly asking for the name of any person
who had knowledge or was involved in the appraisal process, for example. Ms.
Oliver testified that Mr. Wood left the Department on January 16, 2026. As Mr.
Wood was no longer employed by the Department at the time the discovery
request was made, he would not fit the description, and his omission was not
improper.
46. The Board also does not find any error in the disclosure of Mr. Finstad.
Taxpayers take issue with the fact that Mr. Finstad's involvement was not
disclosed in the Department's initial discovery responses and was only
disclosed later in the Department's supplemental responses. The Taxpayers'
initial discovery requests asked for, among other things, the name of each
person at the Department who "had any involvement in, knowledge of, or
responsibility for the assessment, appraisal, valuation, audit, review, appeal
processing, or any other action taken with respect to the Subject Property or the
Taxpayers during the tax years at issue." Ms. Oliver testified that Mr. Finstad is
employed by the Technology Services Division and did not assist with the
appraisal or processing of the Subject Property in any way. Instead, Mr.
Finstad's involvement was limited to verifying whether photographs could be
deleted from the Department's records. Prior to the CTAB hearing, the
Taxpayers made multiple requests to have "all past photographs of our property
(both real and personal) be completely purged from your systems and
databases." Department Coimsel stated that Mr. Finstad's involvement was
16

BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
considered to be fielding a generalized technological question which would not
make him responsive to the discovery request as it was written. Mr. Finstad
was later named in the Department's supplemental responses after the
Taxpayers requested the name of every sender and recipient contained within
the Department's privilege log, which Department Counsel determined
included Mr. Finstad.
47. Based on the testimony before the Board, it appears that Mr. Finstad's
involvement was limited to answering a specific technological question related
to computer systems utilized by the Department. The Board heard credible
testimony that Mr. Finstad did not participate in or influence the Taxpayers'
assessment or appeal, making his exclusion from the initial discovery responses
reasonable. While the technological question answered by Mr. Finstad
stemmed from the Taxpayers' request to have their properties' photographs
removed, it was not specific to the Taxpayers or the Subject Property but was
instead a general question regarding the capabilities of the Department's
systems. Therefore, Mr. Finstad's initial nondisclosure was not improper.
17

BEFORE THE MONTANA TAX APPEAL BOARD
SCOTT AND DAWN HAGEDORN v. STATE OF MONTANA, DEPARTMENT OF REVENUE
ORDER
48. The CTAB's determination is affirmed, and the Department's value of $46,548
is upheld.
Dated this 19th day of August 2026.
^^6-
^~~^	A; ^
, SEAL :
^-^
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y
^7^5F^*
^
Travis Brown, Chairman
AV- MilL.^
AdaiiiJVtillinoff, Member
opher 	'hy, ^le^iber
Notice: You are entitled to judicial review of this Order by filing a petition in district
court within 60 days of the service of this Order. The Department of Revenue shall
promptly notify this Board of any judicial review to facilitate the timely transmission
of the record to the reviewing court. Mont. Code Ann. § 15-2-203(2).
18

BEFORE THE MONTANA TAX APPEAL BOARD
Certificate of Service
I certify that I caused a true and correct copy of the foregoing Findings of Fact,
Conclusions of Law, Order, and Opportunity for Judicial Revie-w to be sent by email
and United States Mail via Print & Mail Services Bureau of the State of Montana on
August 19, 2026, to:
Scott and Dawn Hagedom
P.O. Box 577
Twin Bridges, Montana 59754
sold(%hagedomauction.com
Dave Burleigh
Michele Peterson-Cook
State of Montana, Department of Revenue
Legal Services Office
P.O. Box 7701
Helena, Montana 59604-7701
David.burleigh(%mt.gov
Michele. Cook(%mt.gov
Heather Thurs
Madison County Tax Appeal Board
P.O. Box 278
Virginia City, Montana 59755
Paula Gilbert
State of Montana, Department of Revenue
Property Assessment Division
P.O. Box 8018
Helena, Montana 59604-8108
/
v	
Ha	^^Madison Ambrose
Legal Administrative Assistant
19