F ILE D JUN BOARD OF TAX APPEALS COLUMSUS, OHIO. is attached, TAX APPEAL TO THE SUPREME COURT OF OHIO. Westover Communities, LLC,

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1 U ^^I^^ ' ^^^ ^ TAX APPEAL TO THE SUPREME COURT OF OHIO Westover Communities, LLC, Appellant, BTA Case Nos vs. Franklin County Board of Revision, et al., Appellees. (Real Property Tax Appeal No. L 6^ r^ ^ ^ ^:,^ f,,, ^^..S ^l: e^ ^ - ^ ^^r:rv' ;,,_.^'^, '.-, ;^, ^..:, v :-, :^ o..,.^_...% ^..$= ^..;;.%^._;r.. ;;r,,,; ; ;a :i.. 'i i Y,i F ILE D JUN BOARD OF TAX APPEALS COLUMSUS, OHIO ^'^,% Appellant - Westover Communities, LLC 999 Polaris Parkway, Suite 200 Columbus, Ohio Appellees - Franklin County Board of Revision 373 South High Street, 201" Floor Joseph Testa Tax Commissioner Ohio Department of Taxation P.O. Box 530 Columbus, Ohio Hilliard City School Board of Education 2140 Atlas Street Columbus, Ohio NOTICE OF APPEAL Pursuant to Ohio Revised Code and Ohio Supreme Court Rule of Practice 2.3(A, appellant Westover Communities, LLC appeals to the Ohio Supreme Court from the Decision and Order of the Ohia Board of Tax Appeals (BTA of May 23, 2014, a copy of which is attached, SUMMARY OF BOARD OF TAX APPEALS DECISION: In an appeal from the Franklin County Board of Revision (BOR, Westover Communities, LLC, the owner, challenged the ; HAND DE LIVE "M'ED

2 BOR's valuation of two parcels. While the BOR had rejected the auditor's valuation, it did not fully accept Westover's valuation. The BOR utilized the conzparable values presented by Mr. Homer to adopt a lower valuation than the auditor. 'The Board of Education of the Hilliard City Schools (BOE filed a counter-complaint advocating for the retention of the auditor's values. At the BOR hearing, Westover presented the testimony of its majority owner and Thomas R. Horner, MAI, a certified appraiser, who utilized a "Cost Approach Land Residual Analysis." Despite the lack of any other appraisals, the BTA rejected Mr. Homer's analysis noting his valuation method was not included in Ohio Administrative Code (D and that Horner relied on information from the owiler as opposed to market data. After it completely rejected Mr. Horner's analysis, the BTA found that the BOR reduction in value was unsupported. Without performing any further independent analysis of its own, the BTA then simply reinstated the higher valuation found by the auditor for 2010 and 2011, AssiGNMENT OF ERROR No. 1: The Board of Tax Appeals erred in completely rejecting the only evidence before it on the value of the parcels. The only evidence before the Board was Mr. Horner's valuation, and at the very least the BTA should have utilized the unrebutted comparable sales information to determine the value of the property, which is the procedure used by the BOR to reduce the auditor's initial valuation. ASSIGNMENT OF ERROR No. 2: The Board of Tax Appeals erred in reinstating the auditor's valuation and in failing to conduct its own independent determination as to the taxable value of the parcels. See, Dublin City Board of ^.S'clzools v. Franklin Cty. Bd of Revision, Ohio Supreme Court Case No, , 2014-Ohio As required by Ohio Revised Code , this Notice has also been filed with the Board of Tax Appeals and is being served on the appellees via Certified Mail :

3 CERTIFICATE OF SERVICE "fpzeez Michael L. Close^-^ ( Kerry T. Boyle ( Dale D. Cook ( ISAAC 'wiles BURKHOLDER & TEETOR, LLC Two Miranova Place, Suite 700 ( Fax ( Attorneys foy Appellant Westover Communities, LLC Pursuant to Supreme Court Rule of Practice 14(B(2 and Ohio Revised Code , a copy of this Notice is being served via Certified Mail, postage prepaid, this ay of June, 2014, upon the following: Franklin County Board of Revision 373 South High Street, 20th Floor Appellee Joseph Testa Tax Commissioner Ohio Department of Taxation P.O. Box 530 Columbus, Ohio Appellee Hilliard City School Board of Education 2140 Atlas Street Columbus, Ohio Appellee Ron O'Brien Franklin County Prosecuting Attorney William J. Stehle Assistant Prosecuting Attorney 373 South High Street, 20th Floor Attoxneyfor Appellee Franklin County Board of Revision Karol C. Fox Rich & Gillis Law Group, LLC 6400 Riverside Drive, Ste. D Dublin, Ohio Attorney fon Appellee Hilliard City School Board of Education Dale D. Cook :

4 Westover C ommuniti es, LLC, vs. OHIO BOARD OF TAX APPEALS Appellant(s, Frank.lin County Board of Revision, et al., APPEARANCES: Appeilees. CASE lr1o(s and (REAL,1'ROPER'I'Y TAX DECISION AND ORDER For the Appeliant(s - Isaac, Wiles, Burkholder & Teetor, LLC Kerry T. Boyle Two Miranova Place, Suite 700 For the County - Ron O'Brien Appellees Franklin County Prosecuting Attozney William J. Stehie Assistant Prosecuting Attorney 373 South High Street, 20`h Floor For the A,ppellee Board of Edn. Entered MAY^ ^ Rich & Gillis Law Group, LLC Karol C. Fox 6400 Riverside Drive, Suite D Dublin, Ohio Mr. Williamson, Mr. Johrendt, and Mr. Harbarger concur. Appellant(s appeal decisions of the board of revision ("BOR" which determined the value of the subject real property, parcel nuznber(s and 'fhese matters are now considered upon the notices of appeal, the transcripts certified by the BOR pursuant to R.C , and the appellant's written legal argument. The subject's total true value was initially assessed at $1,903,200j for tax y year '2010 and at $2,264,700 for tax year A decrease complaint was filed with the BOR seeking a reduction in value to $1,750,000 for ta.<^ year The Board of Education-of the Hilliard City Schools ("BOE" filed a cotrntercomplaint advocating for the retention of the auditor's values. At the hearing before the BOR, the appellant first presented the testimony of Robert Yoakam, majority owner of the appeilant, company. Yoakam testified that the appellant purchased the property in April of 2006 with the intention of building condominium units. Due to a downturn in the economy, however, he explained that only five buildings, totaling ten units, have been completed, with only four units sold. The appellant then presented the testimony and report of Thomas R. Homer, MAZ. Homer testified that he utilized 1 The values stated within this decision represent the total true value of both parcels combined,

5 a"c^ndomiziium Analysis,"2 a `Cost. Approach Land Residual Analysis," and the sales comparison approach to arrive at an opinion of value of $290,000, or $5,370 per pad sitc as of January 1, The BOE crossexamined Homer and questioned his methodology, arguing that his opinion of value was only twenty-percent of the actual purchase price of the subject from April The BOR issued decisions decreasing the total true value of the subject to $1,256,700 for tax year 2010 and to $1,603,700 for tax year On the audio portion of the BOR's decision, it noted that it "had issues with Homer's approach." 1ne BOR explained that Homer appraised over twelve acres when approximately ten were at issue and that he did n t value the improvements included on the parcels as of tax lien date. When cases are appealed from a board of revision to this board, an appellant must prove the adjustment in value requested. See, e.g., Shinkle v. Ashtabula Cty. Bd of Revision, 135 Ohio St.3d 227, Ohio-397. As the Supreme Court of Ohio has consistently held, "[t]he best method of determining value, when such inforrnation is available, is an actual sale of such property between one who is willing to sell but not compelled to do so and one who is willing to buy but not compelled to do so. However, such information is not usually available, and thus an appraisal becomes necessary." State ex rel. Park Invest. Co. v. Bd. of Tax Appeals (1964, 175 Ohio St. 410, Such is the case in these matters, as the records do not indicate that the subject property "recently" transferred through a qualifying sale. Although appellant has presented a qualifying appraisal of the subject property, i.e,, values the property as of January 1, 2010, performed for tax valuation purposes, and properly authenticated, we do not find the value conclusion therein to be competent evidence of value.3 As we have noted on previous occasions, the appraisal of real property is not an exact science, but is, instead, an opinion, the reliability of which depends upon basic competence, skill, a.nd ability demonstrated by the appraiser. See, e.g., Cyclops Corp. v. Richland Cty. Bd, of Revision (May 30, 1985, BTA No A-566, et seq., unreported, As Homer admitted his condominium analysis produced a value that was "not logical," and that his sales coinparison approach4 was used only as support, we will focus on 1-lorner's cost approach. In his cost approach land residual analysis, Homer first determined an average retail price by gathering comparable sales prices and effected a:ive percent adjustment due to market conditions. He then deducted costs of construction according to information pr,4vi4ed by the owner to arrive at a value of $290,000 under that approach. Initially, we note that this method is not included in the valuation rnethods provided for in Ohio Adm. Code (D. Next, Homer relied upon information provided by the owner and not independent market data. See Olmsted Falls Village Assn. v, Cuyahoga Cly. Bd of Revision (1996, 75 Ohio St.3d 552, 555 ("an appraiser may employ actual income as reduced by actual expenses if both amounts conform to market," (Emphasis added. Continuing, the Court noted that it has 2 Because this approach resulted in a negative value, 1-Iorner testified that the "Cost Approach Land Residual A.nalysis" was appropriate. The record contains no evidence of value for tax year Horner's report states that only two comparable sales are included because of limited market data. Thus, with such limited data, we are not able to rely on this approach to determine value. 2

6 ., "required the BTA to inalce factual findings, supported by the record, of the appropriate market rents and ^ expenses to be used in the income approach to value." Id. We must also point out that we find that Homer did not adequately establish a change in market conditions, e.g., paired sales that wouid demonstrate such change. Lastly, we echo the BOR's concems that Homer's appraisal does not accurately identify the acreage at issue nor does it account for existing improvements.s With no evidence upon which to rely, we now turn to the BOR's valuation. As indicated by the digital hearing recording, the BOR apparently utilized one of Homer's comparable sales for a land value and the auditor's improvenient value to determine the total true value of the subject property. The BOR, however, included no information in the record as support for their conclusions. Therefore, in considering the record before us in its entirety, we find the BOR's determinations to reduce the subject's values to be unsupported by competent and probative evidence.6 Under such circumstances, we are m.indful of the court's decision in Yandalia-BErtler Citv Schools Bd of Edn. v. Montgomery C'ty. Bd. of Revision (2011, 130 Ohio St.3d 291, 2011-Ohio-5078, at 21, which held: "It is true that the ahsence of sufficient evidence requires the BTA to reverse a reduction or increase ordered by a board of revision. See Columbus City School Dist. Bd ofedn. v. Franklin Cty. Bd of Revision (2001, 90 Ohio St.3d 564, (Emphasis sic. Accordingly, based upon the record and discussion herein, we determine that the value of the subject property as of the effective tax lien dates, i.e., January 1, 2010 and January 1, 201 1, were as originally - assessed by the auditor as follows: The county's property record cards, which were never in dispute, list the subject as copprised of acres with existing improvements on each parcel. Horner's report, however, states that it covers acres and that the purpose of the appraisal was to "estimate the market value of the 54 units remaining under the developer's ownership." It is thus unclear to this board how the value concluded to by Homer applies to the entirety of the parcels at issue and we will not engage in speculation regarding this issue. See Lakota Local School Dist. Bd. of Edn. v. Butler Cty. lid of Revision, 108 Ohio St.3d 310, 2006-Ohio-I 059, at 26 ("Mere speculation is not evidence.". 6 In its brief, the appellant analogizes the instant matter to the case of Dublin City Schools 13r1, of Edn. v. Franklin Cty. ]3d. of Revision, Slip Opinion No Ohio-4543, arguing that the BOE did not preseait any evidence of value and that the auditor failed to consider the property's depreciation. We find the instant matter distinguishable from Dublin,supra. First, the court in Dublin pointed out that the BOR adopted the taxpayer's valuation, Id. at 20. In the instant matter, the BOR disagreed with and did not adopt Horner's valuation conclusions, but rather concluded to its own values. Second, the court in Dublin found that the auditor had not accounted for the unfinished state of the units or the units' depreciation in value due to market conditions. Id. at 23. Here, importantly, the parties have not disputed the accuracy of the property record card regarding the completed nature of the improvements and we find that Homer's appraisal does not evidence a change in market conditions. Lastly, and as discussed herein, we do not find that Homer's appraisal is competent and probative evidence of value and thus does not provide evidence to negate the auditor's valuation. 3

7 4 -. 3anutir,y 1,2010: in PARCEL NUMBER TRUE VALUE $1,186,300 $ 716,900 TAX.A.BLE VALUE $415,210 $250,920 January 1, 2011: PARCEL NUMBER TRUE VALUE TAXABLE VALUE $1,276,400 $446, $ 988,300 $345,910 with this decision and order, It is the order of the Board of Tax Appeals that the subject property be assessed in conformity 1 hereby certify the foregoing to be a true and complete copy of the action taken by the Board of Tax Appeals of the State of Ohio and entered upon its journal this day, with respect to the captioned matter A.J. Groeber, oard Secretary I 4