Appellate Tax Board Releases Findings in West Tisbury Case
By IAN FEIN
West Tisbury assessors did not discriminate against town resident William W. Graham and their valuation system is fundamentally sound, the Massachusetts Appellate Tax Board said last week in its long-awaited legal ruling on a high-profile property tax case that attracted attention across the commonwealth.
Released on Thursday, the report comes almost a full year after tax board issued a decision in the case largely favoring the town. The ruling represents a key victory for the assessors, whose practices were put under a spotlight by the case that challenged the way they conduct townwide revaluations.
The board in its 88-page ruling acknowledged inaccuracies in the assessors' methodology and testimony, but ultimately found that these did not warrant a significant abatement of taxes because Mr. Graham failed to prove that the $50 million value placed on his 235-acre north shore property was too high. The sometimes strongly worded opinion also referred to parts of the Graham legal argument as "riddled with conceptual errors," "spurious," "hollow" and "unfounded."
"Finally, and perhaps most importantly, unlike the assessors, [Mr. Graham] simply failed to offer credible evidence of the Graham properties' fair cash value for the fiscal years at issue," the tax board wrote. "In fact, the board could not discern from the voluminous record on what specific factors the appellants were relying."
The tax board findings broadly uphold the position of the assessors, who argued throughout the case that Mr. Graham had failed to meet his burden of proof.
"We are certainly gratified that the appellate tax board agreed with us on all of the major points," said Woburn attorney Ellen Hutchinson, who represented the assessors in this case and a separate unsuccessful property tax appeal filed by landowners next to Mr. Graham. "I believe there is a measure of vindication here for the assessors."
Board of assessors chairman Michael Colaneri yesterday did not return telephone calls for comment.
The case deals with Mr. Graham's assessments from fiscal years 2003 and 2004, when he paid the town more than a half million dollars in property taxes. Mr. Graham testified during the tax board hearing last summer that he believed he was owed more than $300,000 in tax relief. After making minor adjustments to two of his seven parcels, the board in its decision ordered West Tisbury assessors to reimburse Mr. Graham a total of roughly $5,000.
Release of the findings last week will now allow Mr. Graham to take his case to the Massachusetts Appeals Court, which he has vowed to do. He also has filed subsequent property tax appeals in each of the last three years, and just this month requested a number of public records from the assessors' office regarding those assessments.
Testimony in the case lasted 36 days spread out over a four-month period two years ago, making it the longest-running residential property tax appeal in the history of the commonwealth. West Tisbury taxpayers have spent more than $200,000 in legal bills defending the appeal.
The extraordinary length of the hearing and other controversies surrounding the case spurred a political shake-up at the quasi-judicial state agency, and led to the ouster of former chairman Anne T. Foley just as the board reached a decision in the West Tisbury case. As a result, Ms. Foley did not participate in writing the opinion for a case that she presided over in great detail.
Mr. Graham charged that tax board politics played a role in its decision on his case.
"The opinion was written by commissioners who did not see or hear a single witness, nor participate in five days of viewing properties on Martha's Vineyard. That's not the way the justice system should operate," Mr. Graham said yesterday.
Current tax board chairman Thomas W. Hammond Jr. said last week that the board in writing its final legal report used a road map set forth by Ms. Foley before her departure, and blamed delays in its release on a backlog of cases and short legal staff.
"It took a lot of time, but we wanted to make sure we got it right," Mr. Hammond said. "A lot of issues were raised in this case, and we wanted to make sure we covered the territory."
The tax board in its report boiled the case down to three legal issues: Did Mr. Graham show that the revaluation process in West Tisbury was so compromised by underlying errors that it resulted in unreliable assessments? Did Mr. Graham prove that his properties were worth less than what the assessors valued? And did Mr. Graham establish that the assessors undertook an intentional scheme of discrimination against him?
On all three questions, the board found that Mr. Graham failed to meet his burden of proof. The tax board finding noted that Mr. Graham decided not to submit evidence or appraisals about the market value of his property.
In contrast, the state tax board found that the assessors provided significantly more support and foundation for their case. The ruling relied heavily on a report filed by the assessors' expert witness, an outside appraiser. Though the findings list a series of inaccuracies and mistakes in the appraisal report, the board said the expert appraiser's credibility was enhanced by his willingness to revise his report after new evidence came to light during the hearing.
Meanwhile, the tax board dismissed testimony from an expert hired by Mr. Graham saying he lacked the requisite experience to evaluate the assessors' practices. The board also criticized the overall approach taken by Mr. Graham, who instead of providing independent evidence about market value, offered opinions about how his land assessments differed from other properties in the area and throughout town. The findings further note that Mr. Graham did not follow many of the procedures that the tax board typically requires when comparing properties to one another.
"The board found that while Mr. Graham possessed the requisite knowledge necessary to opine regarding the fair market value of the Graham properties (which he neglected to do), he did not demonstrate the expertise to propose meaningful changes in the assessors' mass appraisal methodology," the board wrote.
In particular, Mr. Graham challenged the assessors' treatment of wetlands, which they sometimes value at $500 an acre but other times combine with a number of other factors. The board in its opinion said it did not find evidence that such a policy was discriminatory, but did suggest that the practice was imperfect, referring to the assessors' valuing of wetlands as "acceptable under the circumstances."
In perhaps the central element of the case, Mr. Graham alleged that assessors during the 2002 townwide revaluation fraudulently altered a property record card for a nearby parcel. Changes to the property record allowed assessors to triple other values in the Paul's Point area near Lambert's Cove.
The tax board opinion accepted the assessors' explanation that changes to the property record were necessary to correct prior inconsistencies, and also found that the large jump in values was justified, considering a string of purchases that each topped $10 million in the area between 1999 and 2005.
Attorneys for Mr. Graham argued that the sale prices did not represent market value because they involved a trio of wealthy brothers who were assembling a family compound. The tax board left open such a possibility in its decision, but said the record provided insufficient evidence to establish that as fact because Mr. Graham never called to the stand any of the principals in those transactions.
The tax board also dismisses in a footnote what appeared to be an important part of the initial hearing - that, in addition to numerical changes on the nearby property record, assessors also changed the description from having a water view to no view. The question of whether a view existed on that property occupied days of testimony at the tax board hearing.
West Tisbury principal assessor Jo-Ann Resendes and an employee for the town's third-party revaluation company, June Perry of Vision Appraisal Technology, both testified that they visited the nearby property at a certain time and saw that the view from an existing house was largely blocked by trees.
The tax board said that their account and the "no view" description were inaccurate, but found that it did not affect the value assigned to the property.
"Other evidence established that at the time of the claimed visit, the house had already been razed and views of the water were apparent from much of the property," the tax board wrote. "The board found that while these inconsistencies served to diminish Ms. Resendes and Ms. Perry's credibility, they did not undermine the overall validity of the mass appraisal methodology employed by the assessors."