Written By: Scott R. Thomas
It’s a nice fall day and you sit down with a cup of coffee to go through your mail. You see you’ve got a letter from the County Auditor and you hold your breath. You open the letter and breathe a sigh of relief when you see the bold words “This is not a tax bill.” You read on and learn that the county thinks your property has increased in value. For about 30 seconds, you feel good, as you reflect on the wisdom of your investment. Then it sinks in that your Ohio property taxes are going up. Not just one year but every year after that. The notice typically provides scant information about the process and what rights you have as a property owner. Many property owners are unaware of their ability to fight the county’s determination. The good news is that you have the tools to contest an unfair valuation.
Years ago, the value of your property would stay unchanged until a sale occurred. An “arm’s length” sale between strangers is always the best evidence of a property’s value. Ohio counties have gotten more aggressive in recent years to increase their tax base. County auditors will now increase a property’s value on their records if they feel they have any justification for doing so, whether it be a comparable sale down the street or a “drive-by” appraisal by a county employee or independent contractor.
The first step is to seek a review by the County’s Board of Revision. You begin this process by filing a Complaint with the Board. That sounds difficult but it’s really just a form that requires you to identify the property and explain why you think the valuation is unfair. That is, you need to tell the County what you think the valuation should be and why. At this stage, only broad brush strokes are required. The Complaint form is usually available online. The Complaint must be filed by March of the following year. For example, if you got a notice this week, your Complaint would need to be filed in March 2016.
The Board will set your Complaint for a hearing. That hearing will usually be conducted in May or June. The hearing will typically be conducted at a conference room at the county offices. The usual players who appear are the County Auditor, the County Attorney, the County’s appraiser, and staff members. An attorney for the pertinent school district will often appear as well. School districts jealously protect the auditor’s valuations because they get the lion’s share of these revenues.
Convincing the Board to overturn the Auditor’s value is a tall order. To prevail, you have to convince the Board that if they affirm the Auditor’s opinion, their decision will be reversed on appeal. To get that kind of traction, you must present evidence at this hearing to support your opinion of the property’s value. You are not required to have an attorney at this hearing but you have little chance of success unless you hire an appraiser. The appraiser you select must not only prepare a report but also be willing to testify at the hearing. Without testimony—and the opportunity to cross-examine your appraisal, the Board may reject the appraisal report itself. Consequently, you want to be careful to select an appraiser who not only knows how to value your property accurately, but who can also communicate that valuation to the Board effectively. You need to work closely with your appraiser to determine the best strategy for calculating the value of your property. While there may be different ways to get to your number, choosing the Cost Approach, the Sales Comparison Approach, or the Income Capitalization approach may have strategic consequences you need to consider in advance.
You will also have an opportunity to examine the Auditor’s evidence. An attorney accustomed to these proceedings can be helpful in this regard. The time a county takes to render a decision varies but you can typically expect a decision within 30 days. If that decision is not in your favor, you can ask the Board of Tax Appeals (BTA) to review the case. You only have a short time to make this choice. Hiring an attorney at this stage is usually critical, if only because of the intricate procedural requirements imposed by the BTA. A misstep on any of these procedural issues may result in the loss of your appeal on a mere technicality. The BTA may conduct a hearing in Columbus but it will usually decline to hear evidence that was not presented to the Board of Revision. This underscores why it is so important to present your entire case to the lower Board. A property owner who saves the best witness for the BTA may find that witness never gets heard. Because the BTA operates state-wide and has no connection to the County, some property owners feel they get their first objective consideration at this stage.
The BTA usually takes much longer to render a decision than the Board of Revision. The tax bill based on the increased valuation will usually come due while your BTA case is still pending. In this situation, your attorney can often negotiate an arrangement with the County to ensure your account is not deemed delinquent.
If the BTA decides the case against you, the decision may be appealed to the Ohio Supreme Court. As before, the Supreme Court’s review will be limited to the issues before the BTA. The Supreme Court will refrain from disturbing a BTA decision if there are reasonable grounds to support it. That is, they will not intervene to say the BTA should have given more weight to your appraiser’s testimony than the County’s. Still, the Supreme Court will carefully review the BTA’s decision to ensure it conforms to Ohio law and judicial precedent.
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