Judge Calls Out DLGF ‘ Infirmities’ In Ruling For Township, Fire District

Dave Stafford for www.theindianalawyer.com

Indiana Tax Court Judge Martha Blood Wentworth had a few choice words for the Department of Local Government Finance in finding the state hadn’t answered the key question in a township’s tax appeal.

Wentworth ruled in favor of Union Township and Union-Lakeville Fire Protection territory in St. Joseph County, which claimed in tax levy appeals a $40 million assessed valuation error shortchanged the entities by almost $52,000 for the 2011 budget year.

“As  an  aside,  the  Court  notes  that  this  case  demonstrates  yet  another  instance where infirmities in the DLGF’s fact-finding process have hindered the Tax Court’s review of  the  final  determination  and  certified administrative  record. See also, e.g., City of Greenfield v. Indiana Dep’t of Local Gov’t Fin., 22 N.E.3d 887, 892 (Ind. Tax Ct. 2014); Gary Cmty. Sch. Corp. v. Indiana Dep’t of Local Gov’t Fin., 15  N.E.3d  1149,  1150  n.3 (Ind. Tax Ct. 2014).

“The Court strongly encourages the DLGF to correct these infirmities so that its adjudicatory process can develop all the relevant facts and legal arguments for possible review by the Court,” Wentworth wrote.

The court on Thursday released concurrent opinions in favor of the township. Wentworth reversed DLGF final determinations denying the township’s appeals and remanded the appeal to the DLGF for further proceedings. The court in a separate opinion denied DLGF’s motion to dismiss the appeal.

Wentworth wrote the department erred in denying the township’s first excess levy appeal, because the shortfall would negatively impact its ability to fund budgets for the township and the fire protection territory. The township demonstrated it depleted its reserves to fund operating costs.

The DLGF also had not answered “‘the $40 million question:’ whether or not an ‘error’ existed,” Wentworth wrote “Here, it is abundantly clear what relief Union Township seeks: it wants to recoup the $51,992 in property tax revenue it was unable to collect in 2011 as a result of the $40 million discrepancy.”

Wentworth remanded to the DLGF to determine whether an error caused the $40 million discrepancy between the net assessed valuation used to certify the township’s budget and the net assessed valuation the county auditor used in issuing property tax bills.

The Legislature granted relief to the fire protection territory, which the DLGF argued mooted the township’s appeal. Wentworth rejected that argument because while the relief provided about $25,000 for the fire protection territory, it provided no relief for the township’s general fund, which claimed it was entitled to $27,000 it was shortchanged due to the assessment error.

The case is Union Township, St. Joseph County v. State of Indiana, Department of Local Government Finance, 71T10-1301-TA-2.