Berkeley County complex owner challenges tax value - WBOY.com: Clarksburg, Morgantown: News, Sports, Weather

Berkeley County complex owner challenges tax value

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The owner of a Berkeley County apartment complex recently argued before the state Supreme Court that the lower court erroneously determined a high value of the property.

Lee Trace filed the case in Berkeley County Circuit Court against Berkeley County assessor Gearl Raynes, the Berkeley County Council and the council, sitting as the Board of Review and Equalization, challenging the 2010 and 2011 tax year assessments.

One case on appeal to the state's highest court contests the court's property value determination and the other case seeks to clarify a previous order relating to the determination that the property owner's challenge to the 2010 tax assessment was not timely filed.

Trace purchased a 17-acre property, which was used to build a 156-apartment unit complex, in Martinsburg for $1,122,504. The complex carried fire insurance in the amount of $17 million.

According to court documents, while the complex was constructed, the assessor determined the property's value at $677,050. In 2010, the assessor determined it was worth $7,895,530. The next year, the assessor determined the value to be $7,593,430.

Court documents note the assessor used a cost approach to determine the property's 2011 value.

Trace then filed an application to review the assessment to the Board of Equalization and Review. Court documents say although Trace didn't submit an appraisal to show the property's value, Trace made a presentation about other apartment complex's assessments.

After Trace requested a hearing, the assessors completed a revised assessment, which used an income approach as opposed to the cost approach, to value the property $5,207,940.

The Board of Equalization and Review reduced the value from $7,895,530 to $6,400,690. 

Trace then petitioned for an appeal, saying the property should be valued at $3,492,696.

The Berkeley County Circuit Court judge denied relief concerning the 2010 assessment, saying Trace waived the right to challenge and didn't file a challenge within the timeframe. However, the court ruled the $6,400,690 value was not an accurate average of the two values.

Noting the fire insurance at $17 million, the court said this would yield an assessment of $10,200,000. The court found the value should be the average of the cost and income approaches to assessments, which is $6,551,735.

On appeal to the state's highest court, Trace argues the court came up with the wrong value by averaging the cost approach with the income approach assessment.

Trace also argued in the brief the court shouldn't have used the 2010 cost approach because it is irrelevant to the 2011 assessment and it shouldn't have used the income approach because the assessor and the court said it wasn't properly done.  Trace's brief also said the court's assessment made the real property taxes too high. 

Raynes, the assessor, argued in the brief to the state's highest court that averaging these two values was an appropriate way to arrive at true market value.

Raynes also argued Trace didn't provide all income and expense information to conduct an income approach appraisal before delivering property books to the board of review, the brief states.

For this reason, Raynes said the court was right to say he couldn't do an income appraisal when there wasn't enough information.

Trace's brief argued the court shouldn't have relied on the property's fire insurance when coming up with the value because it was irrelevant.

The assessor argued the Board of Equalization and Review requires the disclosure of fire insurance and said this amount can be given weight in determining value. The assessor and the Berkeley County Council said the circuit court didn't completely rely on this amount to determine the value.

The Berkeley County Council argued the assessor performed a cost approach to value appraisals for the 2011 correctly. Said petitioner raised no objections to the methodology or the accuracy of this assessment.

Trace also challenged the 2010 tax assessment, saying the assessor didn't perform the assessment right. In the brief, Trace said the 2010 notice didn't advise of a deadline for appeal.

Raynes argued the notice was sufficient and state code doesn't require an appeal date to be given.