Opinion
2014-06-13
In the Matter of SANGERTOWN SQUARE, L.L.C., Petitioner–Respondent–Appellant, v. ASSESSOR OF TOWN OF NEW HARTFORD, Town of New Hartford and New Hartford Central School District, Respondents–Appellants–Respondents.
Tabner, Ryan and Keniry, LLP, Albany (Brian M. Quinn of Counsel), for Respondents–Appellants–Respondents. Gilberti Stinziano Heintz & Smith, P.C., Syracuse (Kevin G. Roe of Counsel), for Petitioner–Respondent–Appellant.
Tabner, Ryan and Keniry, LLP, Albany (Brian M. Quinn of Counsel), for Respondents–Appellants–Respondents. Gilberti Stinziano Heintz & Smith, P.C., Syracuse (Kevin G. Roe of Counsel), for Petitioner–Respondent–Appellant.
PRESENT: SCUDDER, P.J., CENTRA, CARNI, LINDLEY AND DeJOSEPH, JJ.
MEMORANDUM:
Petitioner, the owner of a mall in New Hartford, commenced proceedings to challenge the real estate tax assessments on its property for the tax years 2007/2008, 2008/2009, and 2009/2010. A hearing was held before a Referee, who issued a report reducing the tax assessments for all three years. Petitioner moved pursuant to CPLR 4403 to confirm the report, and respondents cross-moved to reject it, in whole or in part. Supreme Court granted in part and denied in part both the motion and cross motion, and this appeal and cross appeal ensued.
Contrary to respondents' contention, petitioner met its initial burden of establishing by substantial evidence that the property was overvalued, thus rebutting the presumption of validity of respondents' valuation ( see generally Matter of Roth v. City of Syracuse, 21 N.Y.3d 411, 417, 972 N.Y.S.2d 161, 995 N.E.2d 123;Matter of FMC Corp. [Peroxygen Chems. Div.] v. Unmack, 92 N.Y.2d 179, 188, 677 N.Y.S.2d 269, 699 N.E.2d 893;Matter of Alexander's Dept. Store of Val. Stream v. Board of Assessors, 227 A.D.2d 549, 550, 642 N.Y.S.2d 940). We reject respondents' further contention that petitioner's appraiser did not use an accepted method of appraisal. Although the appraisers for both petitioner and respondents utilized the income capitalization approach to value this income-producing property ( see Matter of Senpike Mall Co. v. Assessor of Town of New Hartford, 136 A.D.2d 19, 21, 525 N.Y.S.2d 104), the appraisers differed in their method of calculating market rent. Petitioner's appraiser estimated total market rental income by multiplying projected sales by the occupancy cost ratio, i.e., what tenants are willing to pay in total occupancy costs, such as base rent, real estate taxes, and common area charges, as a percentage of their retail sales. The Referee and the court properly concluded that petitioner's appraiser utilized a recognized appraisal method ( see W.T. Grant Co. v. Srogi, 52 N.Y.2d 496, 508–511, 438 N.Y.S.2d 761, 420 N.E.2d 953;Matter of White Plains Props. Corp. v. Tax Assessor of City of White Plains, 50 N.Y.2d 839, 840–841, 430 N.Y.S.2d 35, 407 N.E.2d 1332).
Respondents further contend that the appraisal and testimony of petitioner's expert was unreliable because he failed to disclose the necessary facts, figures, and calculations that support his conclusion, in compliance with 22 NYCRR 202.59(g)(2). We reject that contention ( cf. Matter of Board of Mgrs. of French Oaks Condominium v. Town of Amherst, 23N.Y.3d 168, ––––, –––N.Y.S.2d ––––, ––– N.E.2d ––––, 2014 WL 1697018 [May 1, 2014] ).
Contrary to respondents' contention, petitioner met its ultimate burden of establishing by a preponderance of the evidence that the property was overvalued ( see generally FMC Corp. [Peroxygen Chems. Div.], 92 N.Y.2d at 188, 677 N.Y.S.2d 269, 699 N.E.2d 893), and we agree with petitioner that the court erred in declining to confirm the report of the Referee in its entirety ( see Nager v. Panadis, 238 A.D.2d 135, 135–136, 655 N.Y.S.2d 946;see also Matter of Gargano v. City of N.Y. Dept. of Fin., 26 A.D.3d 329, 330, 809 N.Y.S.2d 165). The Referee's findings were supported by the record, whereas the findings of the court wherein it rejected the Referee's findings were not supported by the record. The Referee properly concluded that the inclusion of actual tenant tax reimbursements by respondents' appraiser in his calculation of gross income distorted the economic value of the property, as respondents' appraiser essentially conceded during his cross-examination with respect to the 2009/2010 tax year ( see generally Senpike Mall Co., 136 A.D.2d at 23, 525 N.Y.S.2d 104). While the Referee was able to make adjustments to the gross income estimate of respondents' appraiser in the 2009/2010 tax year, there was no testimony or evidence to support an appropriate adjustment to the tax reimbursements for the two prior tax years. The Referee thus relied on the estimation of gross income as calculated by petitioner's appraiser for those tax years. In relying on the estimation of gross income of respondents' appraiser for the 2007/2008 and 2008/2009 tax years, the court made an adjustment to the tax reimbursements that both parties now agree had no support in the record.
It is hereby ORDERED that the order and judgment so appealed from is unanimously modified on the law by granting the motion in its entirety and denying the cross motion in its entirety, and as modified the order and judgment is affirmed without costs.