HomeMy WebLinkAbout19-23-C Discovery View Associates - Chris Robinson, PresidentJefferson County Board of Equalization
Board Clerk's Record of Hearing
Petition No: BOE 19-23-C
Taxpayer's Name: Discovery View Associates - Chris Robinson, President
Mailing Address: PO Box 5668, 1 Mount Jefferson Terrace, Suite 101
City: Portland State: OR. Zip Code: 97228-5668
Taxpayer's Parcel No:
Hearing Was Held On:
Board Members Present
Decision of Board:
948 332 903
Tuesday, March 10, 2020
Dave Garing, Daryl Gillette & Margaret Taylor
Value Sustained: $2,856,978.00
Value Changed From:
Other:
To:
Recorded on Tape No: BOE 031020
Hearing Began at (time): 10:27 a.m. Ended at (time): 11:28 a.m.
Chairperson (or Authorized Designee)
Date
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REV 60 0002e (w) (2/9/12)
ORDER OF THE JEFFERSON COUNTY
BOARD OF EQUALIZATION
Property Owner: Discovery View Associates, A Washington Limited Partnership
Parcel Number(s): 948 332 903
Assessment Year: 2019 Case Number: BOE 19-23-C
Date(s) of Hearing: 3/10/2020
Having considered the evidence presented by the parties in this appeal, the board hereby Sustains F]Overrules
the determination of the Assessor.
Assessor's Determination BOE Determination:
7X Land $507,208 OLand $507,208
7X Improvements $2,349,770 OImprovements $2,349,770
F--]Timber/Minemis F]Timber/Minerals
F]Personal Property F]Personal Property
Total $2,856,978 Total $2,856,978
This decision is based on our finding that: (See Attached)
Dated this.22-44day April, 2020
Dave Garing, ai an 0
NOTICE
Mail
iwa.
ie Shannon, Executive Assistant
order can be appealed to the State Board of Tax Appeals by fling a notice of appeal with them at P.O. Box 40915,
ipia, WA 98504-0915, or at their website at bta.state.wa.us/appeal/forms.htm within thirty days of the date of
of this order. The appeal forms are available from either your County Assessor or the State Board of Tax Appeals.
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Distribution
FORM REV 64 0058 (5/25/2017)
* Assessor * Petitioner
* BOE File
ORDER OF THE JEFFERSON COUNTY
BOARD OF EQUALIZATION
Appellant(s): Discovery View Associates, A Washington Limited Partnership
Appeal No.: BOE 19-23-C
Parcel No.: 948332903
Issue: Discovery View is a 48 -unit low income senior housing community that combines small living
units with common living areas for dining, social and recreational activities, transportation,
housekeeping, and a wellness clinic. Rents are subsidized by the United States Department of
Agriculture Rural Development Program (USDA RDP). Each year, the community submits income and
expense information to the USDA RDP and the USDA RDP determines how much of a subsidy it will
pay on a per unit basis to provide to bring the units to market rent. Discovery View also provides meal,
medical and housekeeping/laundry services. Due to the special nature of this property the Washington
State Department of Revenue issued Property Tax Advisory (PTA 15.1.2009) to describe how to assess
the value of the property. The appellants estimate of true and fair value is $1,122,736 ($507,208 for the
land and $615,528 for improvements/buildings). The Assessor's valuation of the property as of January
1, 2019 is $2,856,978 ($507,208 for the land and $2,349,770 for the improvements).
Appellant's Argument and Evidence: Alex C. Robinson, Consultant, Property Tax Analytics, Inc.,
represented Discovery View Associates at the Board of Equalization hearing on March 10, 2020. The
appellants' representative offered oral testimony at the hearing via telephone conference. He provided:
1. Letter dated February 18, 2020
2. Washington State Department of Revenue, Property Tax Advisory, (PTA 15.1.2009),
3. Discovery View Income Statement — January 2017 — December 2017,
4. Discovery View Income Statement — January 2018 — December 2018,
5. Chart labeled "Cap Rate" from limited data provided by CoStar Realty Information, Inc.,
6. Discovery View Rent Roll as of 12/31/2018, and
7. Comparables:
a. 420 97th Dr NE — Lake Village East Apartments, Everett, WA (sold 8/24/2016),
b. 191 NE Ernst St — Oak Harbor Estates, Gig Harbor, WA (sold 12/10/2018), and
C. 80 Spencer Rd — Cedar Grove Mobile Home Part, Sequim, WA (10/15/2018).
Appellant argued that property's assessed value should be based upon the Discovery View's reports of
2018 net operating income (NOI) for the rental income of $122,388 with a cap rate of 7.5% resulting in a
value of $1,631,840.
Assessor's Argument and Evidence: The Assessor's representative provided:
1. Area Map of the Subject Property,
2. Marshall & Swift Commercial Calculation Sheet of Subject Property,
3. Field Sheet of the Subject Property,
4. Various Flyers and Articles about the Services Provided and Rental rates for Low Income
Seniors,
5. Field Sheet with Recommended Value,
6. Marshall & Swift Commercial Calculation with Recommended Value, and
7. Washington State Department of Revenue, Update Upholding PTA 15.1.2009.
The representative used the Marshall & Swift Commercial cost approach to provide a cost estimate for
the building of $4,699,539 and then discounted it by 50% to reflect the restricted rents for a total assessed
value of $2,349,770.
Decision: The Property Tax Advisory, (PTA 15.1.2009) specifies that the income capitalization method
is the preferred approach for valuing low-income multifamily housing. The Assessor's representative
described asking the property manager for form RD3560 which provides income and expense
information. But this information was not provided. The taxpayer is required to provide "pertinent
data ... and other facts necessary for the appraisal of the property on a timely basis (See WAC 458-07-
0303(5)).
Appellant provided a report of the 2017 and 2018 income and expenses for the rental income only.
However, based upon the rental rolls, roughly a third of the property's total income is from service fees.
These were not included in the net income provided by Appellant.
The sales comparison approach is applicable when there are sufficient recent, reliable transactions to
indicate value patterns or trends in the market. The Appellant provides some sales generally but none
were comparable senior living properties with significant common areas and services.
Finally, if income data or comparable sales are not available, the cost approach may be used.
In this case, the Assessor's representative used the cost approach with a reduction based upon the rent
restrictions.
The law requires that the Board of Equalization presume the Assessor's valuation to be correct unless the
appellant presents clear, cogent and convincing evidence to the contrary. After consideration the Board
finds that the appellant did not present clear, cogent and convincing evidence necessary to overcome the
presumptive correctness of the value established by the Assessor. The Board of Equalization sustains the
value established by the Assessor.