Property Tax Assessment Appeal Dismissed – Iowa

October 7, 2008 | Roger McEowen

Property owners that challenge property tax assessments must file their appeals properly.  That point was made clear in this case.  

Here, in 1995 the plaintiff and her husband bought a 9.5-acre tract in Boone County.  The property contained a house, two barns, granaries, a hog shed and other structures that were all in need of repair.  The property was classified as agricultural at the time of the purchase, and it was purchased with the intent of fixing it up into a vacation home and family retreat.  Accordingly, the plaintiff and her husband put about $800,000 into improving the property.  But, the plaintiff and her husband then divorced with the plaintiff becoming the sole owner of the property.  From 1998-2003, the county assessed the property’s land, buildings and dwelling, but didn’t include any value enhancement for the improvements that had been made.  In 2004, the plaintiff listed the property for sale with a realtor and it was after reading the listing that the assessor realized the property needed to be reclassified as commercial property rather than agricultural.  Based on the advertised selling price, the assessor determined that the previous assessments needed to be increased substantially.  But, because the annual assessment deadline of April 15 had already passed, the assessor sought permission of the Boone County Board of Review for permission to revalue and reclassify the property.  The assessor claimed that the improvements should be assessed as “omitted” property and that the property should be reclassified.  The Board agreed on both counts.
On May 17, 2004, the assessor mailed the plaintiff (who lived out of state) a notice of assessment concerning the omitted property which also notified the plaintiff that the property had been reclassified as commercial.  The notice informed the plaintiff that she had 10 days to appear at the assessor’s office to contest the revaluation and reclassification.  

Unfortunately, the assessor’s office bungled the mailing of the notice (sent it to the wrong address – the assessor sent it to the address they had on file, but the plaintiff had updated her address with the treasurer’s office, and the assessor’s office didn’t check the address with the treasurer’s office before mailing the notice) and someone other than the plaintiff signed (illegibly) the certified mail return receipt.  Thus, when the return receipt came back, the assessor’s office didn’t know that the plaintiff had never received notice.      

In the late summer or fall of 2005, the plaintiff received her tax bill from Boone County and noticed a substantial increase in her property tax.  Her realtor got a copy of the 2004 notice from the assessor and told the plaintiff the reason for the increase.  About 9 months later, the plaintiff petitioned the Board of Review challenging the assessment on various grounds – notice mailed to wrong address, clerical errors, notice was untimely (it was after the April 15 deadline), damages incurred due to errors that she couldn’t contest due to the statutory timeframe having passed, and property improperly reclassified).  The Board denied the plaintiff’s petition on several grounds, finding that the appeal was not timely and that no clerical error had occurred.  The plaintiff appealed to the district court which ruled that the plaintiff should have filed her appeal with the district court, and that her appeal to the Board was untimely because she didn’t file within 10 days of receiving actual notice of the change in valuation and classification.  The plaintiff appealed.

The appellate court affirmed.  The court noted that the plaintiff’s only avenue of appeal according to Iowa Code Chapter 443 required her to appeal to the district court when omitted property is involved in an assessment.  The district court is the only body that, by statute, can determine whether property has been truly omitted within the meaning of the statute allowing assessment of omitted property.  Baldwin v. Boone County Board of Review, No. 8-427/07-1145 (Iowa Ct. App. Oct. 1, 2008).