State Appellate Tax Board Upholds Town Assessors in William Graham Case
By IAN FEIN
In a highly anticipated decision that reverberated across the commonwealth, the Massachusetts Appellate Tax Board ruled unanimously this week that the values West Tisbury assessors placed on the North Shore estate owned by William W. Graham were largely correct.
The decision represents a pivotal victory for the town in the high-profile property tax appeal brought by Mr. Graham, a year-round resident who owns 235 acres at Mohu off Lambert's Cove Road. The tax board on Tuesday granted minor abatements on two of his seven parcels, lowering the total $51 million assessment by $520,000 - a decrease of roughly one per cent.
According to the tax board ruling, the town must reimburse Mr. Graham $5,460 in property taxes from fiscal years 2003 and 2004. Mr. Graham testified during the tax board hearing last summer that he felt he deserved more than $300,000 in tax relief.
Woburn attorney Ellen Hutchinson, who represented the town in the dispute, called the decision vindication for the West Tisbury assessors, whose practices and character were impugned in the case. Board chairman Michael Colaneri and principal assessor Jo-Ann Resendes did not return calls for comment this week.
But Ms. Hutchinson spoke for all. "We're ecstatic," she said. "There was no fraud, there was no error in the revaluation system, there were no flaws in how it was applied. And we're grateful that the appellate tax board saw the legal issues in the same way that we did."
In truth no one in the public sector knows how the quasi-judicial tax board saw the legal issues, because findings of fact have not yet been released in the case.
Mr. Graham, meanwhile, said he was disappointed but not surprised by the tax board decision, and he vowed to take his case to the Massachusetts Court of Appeals, the next step in the judicial process.
"The appellate tax board is somewhere you have to go and make a record before you go to the court of appeals," Mr. Graham said this week. "And that's the way I've always seen it."
State officials, tax attorneys and town assessors - who have closely followed the legal and political twists and turns in the case - this week tried to interpret the one-page tax board decision, which was issued on Tuesday absent any explanation or report. Findings of fact are not expected for months.
Former appellate tax board chairman Kenneth Gurge, who as a private attorney now represents both taxpayers and municipalities before the board, said yesterday that most practitioners familiar with the tax board expected such a decision in the case. Mr. Graham argued a unique theory, he said, and many people are still unclear what sort of remedy was sought.
"It was our understanding as outsiders that the taxpayer did not put forward any affirmative evidence of what he felt his value should be. So it's hard to see how the board could have ruled in his favor," Mr. Gurge said. "This case seemed like an attack on the way the assessments were done. And the general rule is that even if a taxpayer shows that the system is bad or an assessment is bad, that alone does not fulfill their burden of proof."
Mr. Gurge also said that had Mr. Graham won his case - which challenged the way assessors conduct townwide revaluations - it would have been a historical, precedent-setting decision for the appellate tax board and commonwealth.
"If this had gone completely the other way, it would have undercut the mass appraisal system that most towns rely on," Mr. Gurge said. "It would have really caused turmoil across the state."
Massachusetts Association of Assessing Officers president Edward Childs, also an assessor in Sandwich on the Cape, expressed relief yesterday that the tax board decision favored the town. He said the minimal return granted to Mr. Graham should repair the reputation of the West Tisbury assessors and their third party consultant, Vision Appraisal Technology of Inc., whose work came under scrutiny during the case. Vision Appraisal president Kevin Comer did not return a call for comment yesterday.
"I think a great deal of this decision upholds what has been done," Mr. Childs said. "In the end, this turned out to be just another residential case."
Officials at the Massachusetts Department of Revenue this week said they are still awaiting the fact-finding portion of the tax board decision, and that they stand by their previous recommendation that the towns on the Vineyard should explore regionalizing their assessing departments as a way to improve the accuracy of property values and accountability of Island assessors. Department officials have suggested that the five Island towns that use Vision Appraisal rely too heavily on the work of their outside consultant.
"We look forward to seeing the basis upon which the appellate tax board made its decision," division of local services spokesman Lydia Hill said this week. "But simply because the town won the case does not negate the fact that there was a disgruntled taxpayer who felt he wasn't being heard. We believe that the taxpayers of Martha's Vineyard deserve to have the most professional assessing operation available under law."
Mr. Graham said that the tax board decision, which placed the fair market value of his property at just over $50 million, failed to directly address his concerns, which center more on the comparison of his assessments to others in town, rather than the ultimate fair market value of his property. He reiterated his primary concern that assessors apply a fair and rational system uniformly across town.
"What I've said is that if my property is assessed at fair market value, then many of the other properties in town are assessed at half," Mr. Graham said.
He offered as examples the pending sale of an abutting property, which is currently owned by Dr. Timothy and Ellen Guiney, and the recent sale of a Tisbury Great Pond property previously owned by the family of town selectman Jeffrey (Skipper) Manter. The eight-acre Guiney property is set to close today for $7.5 million, substantially less than its $10.3 million assessment, while the seven-acre Manter property sold earlier this month for $3.25 million, substantially higher than its $1.5 million assessment.
"A selectman had his family property assessed at less than half of market value, while my next-door neighbor had theirs assessed at almost 40 per cent over," Mr. Graham said. "That's exactly what I've been saying all along."
The theory is known as disproportionate assessment. And according to tax board case law, a taxpayer in order to prove a disproportionate case must show an intentional and widespread scheme on the part of the assessors to overvalue a certain class of parcels.
Acknowledging the high burden of proof placed on such an argument, Mr. Gurge said that it has been roughly 25 years since any taxpayer has won a disproportionate assessment case at the appellate tax board.
Mr. Graham this week also questioned whether the decision in his case may have been affected by the political turmoil surrounding the imminent departure of tax board chairman Anne Foley, who presided over the hearing last summer. It is understood that Chairman Foley played a minimal role in the decision, and it is still unclear whether she will assist in writing the findings of fact.
West Tisbury selectmen at their regular meeting this week had no comment on the decision in a case that has dominated political discourse in town over the last year. The lawsuit has cost town taxpayers more than $200,000 in legal bills, and that number is expected to rise as Mr. Graham takes his case further up the appeals process.
More than one person this week suggested that the case might ultimately be decided by the Massachusetts Supreme Judicial Court.
Mr. Graham pointed bluntly to an earlier tax board decision in favor of the West Tisbury assessors that was overturned by the court of appeals in fall 2004.
"The last big victory West Tisbury and its attorney won at the appellate tax board was against the Martha's Vineyard Land Bank, when they decided to tax them. And that was summarily reversed by the court of appeals in a quite harsh opinion," Mr. Graham said. "I believe that's going to be the result here."
But Mr. Gurge noted that decisions of the appellate tax board have an affirmative rate of more than 90 per cent in the appellate courts. Mr. Childs also questioned the chance that Mr. Graham might succeed.
"On what basis would an appeals court could come back and overturn the decision?" Mr. Childs asked. "I think the taxpayer is going to have a hard road to hoe."