Can a Taxpayer Appeal for a County's Assessment Based on a Base Year Market Value to Be Reduced to the Property's Current Market Value ?
In Appeal of Armco, Inc., 100 Pa. Commw. 452, 515 A.2d 326 (Pa. Cmwlth. 1986), Butler County used a base year market valuation system to do its county-wide assessment, as was authorized by Section 602(a) of the Fourth to Eighth Class County Assessment Law, Act of May 21, 1943, P.L. 571, as amended, 72 P.S. 5453.602(a).
Section 602(a) provides in pertinent part as follows:
After there has been established and completed for the entire county the permanent system of records consisting of tax maps, property record cards and property owners' index, as required by section three hundred six of the act herein amended, real property shall be assessed at a value based upon an established predetermined ratio, of which proper notice shall be given, not exceeding one hundred per centum (100%) of actual value.... In arriving at actual value the county may utilize the current market value or it may adopt a base year market value. 72 P.S. 5453.602(a).
The taxpayer filed an appeal under Section 704 of the Fourth to Eighth Class County Assessment Law, asserting that its assessment, which was developed using a base year market value, should be reduced to reflect the property's current market value.
Section 704 provides in pertinent part:
(b) In any appeal of an assessment the court shall make the following determinations:
(1) the market value as of the date such appeal was filed before the board of assessment appeals. In the event subsequent years have been made a part of the appeal, the court shall determine the respective market value for each such year.
(2) the common level ratio which was applicable in the original appeal to the board. In the event subsequent years have been made a part of the appeal, the court shall determine the respective common level ratio for each such year published by the State Tax Equalization Board on or before July 1 of the year prior to the tax year being appealed.
(c) the court, after determining the market value of the property pursuant to subsection (b)(1), shall then apply the established predetermined ratio to such value unless the corresponding common level ratio determined pursuant to subsection (b)(2) varies by more than fifteen per centum (15%) from the established predetermined ratio, in which case the court shall apply the respective common level ratio to the corresponding market value of the property.
(d) Nothing herein shall prevent any appellant from appealing any base year valuation without reference to ratio. 72 P.S. 5453.704.
The trial court agreed with the taxpayer, and Butler County appealed.
Butler County asserted that because it used a base year market valuation in its county-wide assessment, Section 704 was unconstitutional in contravention of the "uniformity clause" of the Pennsylvania Constitution.
The uniformity clause of the Pennsylvania Constitution states:
All taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be levied and collected under general laws. Pa. Const. art. VIII, 1
It argued that it was discriminatory to use one method to assess a property "administratively", i.e., by the assessor's office, and a different method to assess that property in the course of an assessment appeal.