Wallace Paul Boquist v. Board of Assessors of the Town of Lincoln (September 26, 2014)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD


WALLACE PAUL BOQUIST	v.		BOARD OF ASSESSORS OF
			THE TOWN OF LINCOLN


Docket Nos.: F306906,			Promulgated:
             F314768			September 26, 2014		
		

	These are appeals 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 Lincoln ("assessors" or "appellee"), to abate taxes on certain real estate located in the Town of Lincoln owned by and assessed to Wallace Paul Boquist ("appellant") under G.L. c. 59, §§ 11 and 38 for fiscal years 2010 and 2012 ("fiscal years at issue").
	Commissioner Chmielinski heard these appeals.  Chairman Hammond and Commissioners Scharaffa, Rose and Good joined him in the decisions 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.  

	Wallace Paul Boquist, pro se, for the appellant.
Harald Scheid, Chief Assessor, for the appellee.
FINDINGS OF FACT AND REPORT
Introduction and Jurisdiction
On January 1, 2009 and January 1, 2011, the relevant assessment dates for the fiscal years at issue, the appellant was the assessed owner of a 5.79-acre parcel of land located at 241 Old Concord Road in Lincoln, improved with a single-family residence and a separate building containing a studio apartment (collectively, the "subject property").  The parcel is divided into a 0.57-acre "prime" residential site, on which the improvements sit, and 5.22 acres of land that is classified as agricultural/horticultural land  under G.L. c. 61A ("Chapter 61A").  
For fiscal year 2010, the assessors valued the subject property at $744,964, and assessed a tax thereon in the total amount of $8,768.77.  More specifically, the residence and prime site were valued at $744,400, and taxed at a rate of $11.47 per thousand, while the Chapter 61A land was valued at $564, and taxed at the rate of $15.09 per thousand.  The appellant paid the tax without incurring interest.  On December 9, 2009, the appellant filed an abatement application with the assessors which was denied by vote of the assessors on March 8, 2010.  The appellant seasonably filed his Petition Under Formal Procedure with the Appellate Tax Board ("Board") on June 2, 2010.
For fiscal year 2012, the assessors valued the subject property at $670,301, and assessed a tax thereon in the total amount of $9,496.28.  More specifically, the residence and prime site were valued at $669,600, and taxed at a rate of $13.81 per thousand, while the Chapter 61A land was valued at $701, and taxed at the rate of $18.17 per thousand.  The appellant paid the tax without incurring interest.  On October 27, 2011, the appellant filed an abatement application with the assessors which was denied by vote of the assessors on November 4, 2011.  The appellant seasonably filed a Petition Under Formal Procedure with the Board on January 31, 2012.
On the basis of the preceding facts, the Board found and ruled that it had jurisdiction over the instant appeals.
Property Description
 The subject property consists of 5.79 acres bordered by Fairhaven Bay Pond ("pond") to the west and Old Concord Road ("OCR") to the east.  The pond is a wide portion of the Sudbury River and OCR is an unpaved, dead-end road running parallel to the pond.  The subject property is located in the middle of a group of ten residential properties located between OCR and the pond.  All properties along this heavily-wooded stretch enjoy pond frontage, making it a sought-after area. The assessors classified the subject property as an "R5" for assessment purposes, indicating that it was in a desirable location.  
 The parcel is divided into a 5.22-acre portion which has been classified as agricultural/horticultural land under Chapter 61A since 2005, and a 0.57-acre, or 24,829-square-foot, prime site.  The subject property is improved with a contemporary-style dwelling, built in 1951, which the assessors considered to be in "average" condition.  The dwelling contains 1,775 square feet of living space, including three bedrooms, and it also features two full bathrooms and a fireplace.  It has a wooden exterior, a tar and gravel flat roof, and a concrete block foundation.  There is also a 792 square-foot, detached studio apartment.  
The Appellant's Case-in-Chief
 For fiscal year 2010, the appellant's primary claim was that the subject property was overvalued.  In particular, he disagreed with the assessors' valuation of the subject's 24,829 square-foot prime site.  In support of this claim, the appellant entered into evidence a multi-sectioned binder containing assessment data for nine neighboring properties located on OCR, as well as the subject property, for fiscal years 2004 through 2010.  
In making his presentation, the appellant emphasized the increase in value of his prime site between fiscal years 2009 and 2010.  During that time period, the subject property's prime site increased in value approximately 37.5%, from $432,005 to $593,880.  The appellant presented a chart comparing the assessment data of the other nine OCR properties with the subject property's assessments over the same time period.    Relevant portions of the appellant's comparative assessment data are summarized in the following chart.
	        Appellant's Comparable Assessment Data 
Address	Prime Site Size
(sq. ft.)	2009 Prime Site Adj.  Factor	2009 Prime  Site Value ($)	2010 Prime Site Adj. Factor	2010 Prime Site Value ($) 	Total Change($)	% Change 		219 OCR	 80,000	  1.0	  696,000	  1.0	748,800	  52,800	  7.6		225 OCR	 80,000	  1.0	  696,000	  1.0	748,800	  52,800	  7.6		231 OCR	 80,000	  1.7	1,183,200	  1.3 	973,440	(209,760)	(17.7)		233 OCR	 80,000	  1.45	1,009,200	  1.3	973,440	 (35,760)	 (3.5)		237 OCR	 80,000	  1.35	  939,600	  1.3	973,440	  33,840	  3.6		247 OCR	 80,000	  1.0	  696,000	  1.0	748,800	  52,800	  7.6		253 OCR	 80,000	  1.15	  800,400	  1.0	748,800	 (51,600)	 (6.4)		259 OCR	 80,000	  1.4	  974,400	  1.3	973,440	    (960)	 (0.1)		263 OCR	 80,000	  1.45	1,009,200	  1.3	973,440	 (35,760)	 (3.5)		Subject 	 24,829	  2.0	  432,005	  2.555	593,880	 161,875	 37.5 		As illustrated by this data, between fiscal years 2009 and 2010, the assessed value of the subject property's prime site increased at a higher rate than the prime sites of the nine comparison properties during the same time period.  The appellant argued that this provided evidence that the subject property was overvalued.  
In further support of his argument that the subject property was overvalued, the appellant presented a graph comparing the changes in the town's adjustment factors for the subject property and his selected comparison properties' prime sites from fiscal years 2001 to 2010.  The data presented by the appellant for fiscal years 2006 to 2010 is represented in the following graph. 



  As illustrated by the graph, the adjustment factors were constant between fiscal years 2006 and 2009, whereafter the subject property's adjustment factor increased while the nine comparison properties' adjustment factors decreased.  
The appellant concluded his comparison of the subject property to the nine other OCR properties by analyzing their respective prime sites' valuation per square foot.  This information reflected the same trends evidenced by the graph shown above.  Again, the appellant argued that the sharp increase in his prime site's per-square-foot assessment was evidence of overvaluation when compared to the assessments of the other nine OCR properties' prime sites.  
 Finally, the appellant stated that the subject property's assessment deprived him of the "significant local tax benefits" that the Legislature, in enacting Chapter 61A, intended to confer "to property owners willing to make a long term commitment to farming."  According to the appellant, upon initially converting the bulk of his property to Chapter 61A land in 2005, he received a 53.9% property tax discount, which declined to 33.6% in 2009, and then to 12.2% in 2010.  He argued that the spike in the subject property's prime site valuation in fiscal year 2010 prevented him from achieving the tax benefits intended by Chapter 61A, which he advanced as an additional argument in support of an abatement.  
	The appellant offered no evidence or arguments pertaining to his fiscal year 2012 appeal.  
Appellee's Case-in-Chief
 The assessors presented their case-in-chief through the testimony of principal assessor, Harald M. Scheid, and the submission of several documents.  
Mr. Scheid testified that the subject property was considered to be located in an "R5" neighborhood, which he explained is a designation given to those properties with privacy and water frontage.  The assessors entered into evidence a copy of Lincoln's residential land table for "R5" properties ("land table"). Mr. Scheid testified that the land table had been certified by the Massachusetts Department of Revenue ("DOR") in conjunction with the town's Fiscal Year 2010 property revaluation, and evidence of DOR's certification was also entered into the record.  He argued that the subject property's prime site valuation was directly in line with the state-certified land table, which, he contended, provided an indication that it was not overvalued.  A sample of the data contained in the land table, relevant to fiscal year 2010, is reproduced in the following chart. 



 Sample FY 2010 Data from Lincoln's Residential Land Table
Prime Site Land Area
(sf)	% of Full Prime Site (80,000 sf)	FY 2010 
Size Adjust.	FY 2010 Value ($)	FY 2010 Value ($/psf)	
 10,000	     12.5	  0.738	 552,240	  55.22	
 24,829*	      31	  0.79	 593,900	  23.92	
 40,000	      50	  0.85	 636,480	  15.91	
 60,000	      75	  0.925	 692,640	  11.54	
 80,000	     100	  1.000	 748,800	   9.36	
* Size of Subject Property's Prime Site
Mr. Scheid explained that the land table is non-linear.  According to the land table, a full prime site of 80,000 square feet, which was the prime site size of the nine OCR properties offered for comparison by the appellant, was assessed at a lower per-square-foot rate than were smaller prime sites, like the subject property's prime site.  The basis for this differential, he explained, is the well-established principle that unit prices generally decrease with increases in unit size.   
In addition, Mr. Scheid testified that in order to create a more stable and uniform land schedule, DOR eliminated the use of "site influences," beginning in fiscal year 2010.  
"Site influences" had previously been used to set values for properties, including those located on OCR, and this change in practice contributed in part to the increase in value from the preceding fiscal year emphasized by the appellant in his case-in-chief.  
 The assessors additionally introduced into evidence a copy of DOR's Farmland Chapter Land Recommended Value chart along with the property record card for the subject property.  These documents established that the portion of the subject property that had been converted to Chapter 61A land was valued in concert with the state-recommended rates.
Lastly, Mr. Scheid offered into evidence a number of vacant residential land sales in Lincoln, three from 2007; one from 2008; two from 2010; and one from 2011.  Each of the sales had a prime site of 80,000 square feet, with varying amounts of additional acreage.  They ranged in sale price from a low of $175,000 to a high of $1.3 million; however, those bookend prices represented extremes.  The remaining five sales were more closely clustered, ranging in price from $375,000 to $600,000.  Mr. Scheid did not perform a comparative analysis of the sales, nor did he make any adjustments to account for differences from the subject property, nor was any information offered to indicate whether the sales were arm's-length transactions.  
For fiscal year 2012, the assessors rested on the assessment as the appellant admittedly provided no evidence supporting his claim for abatement for that year.
  
   The Board's Subsidiary Findings of Fact and Ultimate Conclusions

On the basis of all of the evidence, the Board found that the appellant failed to meet his burden of establishing that the assessed value of the subject property exceeded its fair cash value for the fiscal years at issue.  
The appellant offered no evidence of recent sales of similar properties in the subject's vicinity that would indicate that the subject property was assessed for more than its fair cash value.  Instead, he focused on a comparison of the assessed value of the subject property's prime site and the prime sites of nine neighboring properties.  However, the relevant question is whether the assessment for the parcel of real estate, including both the land and the structures thereon, is excessive, and thus the appellant's comparisons were deficient.  
The more probative inquiry is between the overall assessed value of the subject property and the overall assessed values of the comparison properties.  Those values, along with other pertinent information regarding each property, are set forth in the following chart.




FY 10 Assessed Values of Ten OCR Properties
Address	Parcel Size (ac)	Living 
Area (sf)	Beds/
Baths	FY 10 Assessment($)	
219 OCR	 2.8	2,633	3/2	1,049,900	
225 OCR	 3.18	3,608	3/2	1,112,200	
231 OCR	 5.6	6,142	5/5.5	3,241,800	
233 OCR	 3.75	3,328	2/2.5	1,670,800	
237 OCR	 4.89	3,540	6/3.5	1,298,400	
247 OCR	 5.3	2,292	3/2	  943,700	
253 OCR	 2.16	2,444	4/2	1,011,300	
259 OCR	 3.45	3,446	2/2	1,441,900	
263 OCR	 4.15	6,421	4/4	2,064,500	
Subject	 5.79 	1,775	3/2	  774,964	







As is demonstrated by the chart above, the assessed value of the subject property was significantly lower than the assessed values of the properties offered for comparison by the appellant, and the Board could not conclude, based on this data, that the subject property was overvalued.  
Further, in making his comparisons, the appellant failed to take into consideration the well-established principle of diminishing returns with increases in unit size.  The subject property's prime site lot was significantly smaller than those of his comparison properties, and it was therefore logical that it would be valued at a higher value per square foot.  
Lastly, the Board rejected the appellant's claim that the increase in the value of his prime site deprived him of the tax benefits intended by the Legislature in enacting Chapter 61A.  The Board found that the assessors assessed the appellant's Chapter 61A land in compliance with DOR's guidelines, and as a result, the appellant enjoyed the benefit of dramatically reduced valuation of that land.  For example, for fiscal year 2010, the appellant's 5.22 acres of Chapter 61A land were valued at just $564.  By contrast, the evidence showed that, for that same fiscal year, the 2.31 acres of excess land at 263 Old Concord Road, offered for comparison by the appellant, were valued at $59,100, while the .96 acres of excess land at 219 Old Concord Road, also offered for comparison by the appellant, were valued at $24,800.  The appellant's claim that he did not derive the reduced tax benefits intended by Chapter 61A was squarely contradicted by the evidence, and the Board therefore rejected his argument.  
In addition to the aforementioned shortcomings in the appellant's evidence, the Board found that the evidence presented by the assessors provided additional support for the subject assessments.  Specifically, the Board found that the assessors demonstrated that they valued the subject property in accordance with the residential land tables and other guidelines approved by DOR.  This information, coupled with the presumptive validity of the assessments, and in light of the deficiencies in the appellant's evidence, compelled the Board to conclude that he failed to meet his burden of proving that the subject property was overvalued for fiscal year 2010.  
With respect to fiscal year 2012, the appellant presented no evidence showing that the subject property was overvalued as of the relevant date of valuation and he acknowledged as much in his testimony.  The Board therefore found that he failed to meet his burden of proof for fiscal year 2012 as well.  
In conclusion, on the basis of all of the evidence, the Board found that the appellant failed to meet his burden of establishing that the assessed value of the subject property exceeded its fair cash value for the fiscal years at issue, and it therefore issued decisions for the appellee in these appeals. 

OPINION
The appellant has the burden of proving that the property has a lower value than that assessed.  "'The burden of proof is upon the petitioner to make out [his] 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 board 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)).
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)).  
In the present appeals, the appellant relied on a comparison of the assessed value of the subject property's prime site and the assessed values of the prime sites of nine neighboring properties in making his claim for abatement. His evidence failed for a number of reasons. 
First, a taxpayer does not conclusively establish a right to abatement merely by showing that his land or building is overvalued. 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.  Here, the appellant primarily disputed the valuation of his prime site, offering no evidence regarding the valuation of the parcel as a whole.  Even assuming arguendo that the Board concluded that the subject's land was overvalued, which it did not, that conclusion alone would not have entitled the appellant to an abatement, as he failed to demonstrate that the assessed value of the subject property as a whole exceeded its fair cash value.   
Second, the appellant's primary argument - that the subject property's comparatively smaller prime site was assessed at a higher per-square-foot value than the much larger prime sites of several neighboring properties - failed to take into consideration the well-established principle that "[generally], as size increases, unit prices decrease. Conversely, as size decreases, unit prices increase." (appraisal institute, the appraisal of real estate 212 (13th ed. 2008); see also Seto v. Assessors of Quincy, Mass. ATB Findings of Fact and Reports 2006-585, 591.  Accordingly, the Board was not persuaded by this argument, or by the evidence offered in support of it. 
Lastly, the Board was not persuaded by the appellant's claim that the assessment of the subject property deprived him of the tax benefits intended by the Legislature in enacting Chapter 61A.  The record showed that the assessors valued the appellant's Chapter 61A land in accordance with DOR's guidelines, resulting in a significantly lower assessed value, and tax, for that land.  Moreover, even if the Board found merit in this argument, it would not furnish grounds for an abatement in these appeals.  
In conclusion, on the basis of all the evidence, the Board found and ruled that the appellant failed to meet his burden of proving that the assessed value of the subject property exceeded its fair cash value for the fiscal years at issue.  Accordingly, the Board issued decisions for the appellee in these appeals.  
		
						THE APPELLATE TAX BOARD

					By: ___________________________________
					    Thomas W. Hammond, Jr., Chairman
							

A true copy,
Attest: ___________________________
			Clerk of the Board

 Chapter 61A was enacted by the Legislature in 1973 "for the purpose of developing and conserving agricultural or horticultural lands."  See St. 1973, c. 1118, s. 1.  Pursuant to Chapter 61A, taxpayers with a minimum of five acres who make a commitment to agricultural or horticultural use of their land are rewarded with a reduction in property tax for that land.  
 This amount includes a Community Preservation Act ("CPA") surcharge of $221.99.  
 This amount includes a CPA surcharge of $236.37.
 The rating scale goes from R1 to R7, with R7 being the most desirable. 
 The prime site adjustment factors are a combination of a town-designated ratio based on the size of a prime site, with 1.0 being a full prime site of 80,000 square feet, which is the minimum size required by zoning, and additional adjustments made for notable differences in quality.  The appellant previously had a full prime site of 80,000 square feet, but his prime site decreased to just 24,829 square feet after he converted the remaining 5.22 acres to Chapter 61A land.
 The land table was lengthy and could not readily be reproduced in its entirety here. 
 The information introduced by the assessors indicated that this parcel had extremely poor access, which may explain why its sale price was much lower than the other parcels.  
 Although neither the appellant nor the assessors brought it to the Board's attention, it appeared from the property record card that the appellant was also the assessed owner of 247 OCR, and that he had likewise converted a large portion of that property to Chapter 61A land, which explained why it had the second-lowest overall assessed value - with the subject's being the lowest - among all ten of the OCR properties.  
 This amount does not include the 792-square-foot studio apartment. 
 However, the Board did not place reliance on the residential land sales offered by the assessors, as no evidence was introduced to establish that they were arm's-length transactions, nor were adjustments made to account for differences from the subject property.  

ATB 2014-704