Arizona Court ofAppeals Division One Holds that When the Value of Real Property Is Set After an Administrative Appeal to the Arizona Tax Court the Value Rolls Over to the Next Tax Year Pursuant to A.R.S. § 42-16002(B).

Concord Equities, L.L.C. owns a large parcel of land in Pima County that is used for a 248-unit apartment complex,.  Pima County Assessor Bill Staples mailed a notice of property valuation toConcord for tax year 2006.  The Assessor had set the full cash value at $7,867,800 and the limited property value at $7,201,920.  Concord disputed these amounts and therefore instituted an appeal by filing a petition with the Assessor pursuant to A.R.S. § 42-16051 (2003).  When the Assessor recommended no change, Concord appealed to the State Equalization Board under A.R.S. § 42-16157 (2001).  The Board determined that A.R.S. § 42-16002 required the full cash and limited property values for the 2005 tax year to roll over for tax year 2006. The 2005 value was based upon a full cash value of $6,696,000 to which the parties had stipulated in tax court, a reduction from the Assessor’s previous determination of full cash value.  The Board reduced the full cash value to the tax year 2005 level, and the limited cash value accordingly dropped pursuant to A.R.S. § 42-13301 (1999).  The Assessor and Pima county then appealed to the tax court pursuant to A.R.S. §§ 42-16168(A) (1999), 42-16203 (2001), 42-16207 (1999), and 12-163 (2003).  The tax court grantedConcord’s cross-motion for summary judgment denied the Assessor andPimaCounty’s motion, and awardedConcord its costs.  The Assessor and County appealed.       

The ArizonaAppeals Court affirmed.  The Court concluded that Concord was entitled to roll over treatment because A.R.S. § 42-16002(B) provides (in pertinent part) that “[i]f a review or administrative appeal pursuant to article 2, 3 or 4 of this chapter [16] results in a reduction of the valuation or a change in the classification of property, in the next year the valuation or classification of property shall be the valuation or classification that was determined by the review or appeal . . . .”   This roll-over provision clearly applied because Concord had pursued an appeal to the Board and tax court under statutes in Articles 2 and 4 of chapter 16, and that appeal ultimately resulted in a reduction of the valuation.  The Court awardedConcord its costs and attorneys’ fees on appeal as well.                           

Judge Kessler authored the opinion; Judges Thompson and Downie concurred.