Official Publication of the Minnesota Association of Assessing Officers mnmaao.org EQUAL OktoberfestEYES Issue
FAll 2016 Volume 38 Number 146
Tax Court: The Blandin Paper Company Photo Contest Winners What You Get For - Farmland
Global Assessment Germany
Exempt Example: A Tour of the Oliver H. Kelley Farm
Beerview: Assessing the Local Ale EDITORIAL MAAO COMMITTEE LEADERSHIP
Executive Officers President Nancy Wojcik, SAMA Lori Thingvold, SAMA st Wright County 1 Vice President Kyle Holmes, SAMA Managing Editor Financial Officer William Effertz, SAMA Past President Dan Whitman, SAMA
Regional Directors
Jason Jorgensen, SAMA Region 1 Joy Kanne, SAMA Meeker County Region 2 Sue Schulz, SAMA Associate Editor Region 3 Daryl Moeller, SAMA Region 4 Mark Peterson, SAMA Region 5 Lorna Sandvik, SAMA Region 6 Joe Udermann, SAMA Solomon Akanki, SAMA Region 7 Doug Walvatne, SAMA City of Brooklyn Park Committee Chair Region 8 Mary Jo Otten, SAMA Region 9 Kent Smith, CMA
Committee Chairs Agricultural Tom Dybing, SAMA CAMA and GIS Randy Lahr, SAMA Jamie Freeman, SAMA Conference Coordinator Paul Knutson, SAMA, RES Clearwater County Editorial Solomon Akanki, SAMA Information Systems Matt Gersemehl, SAMA Legislative Mark Peterson, SAMA Membership Coordinator Rebecca Malmquist, SAMA, RES Nominating and Procedures Michelle Moen, SAMA Nancy Gunderson SAMA On-Line Administrator Lori Schwendemann, SAMA Clay County Rules and Resolutions Marvin Anderson, SAMA Sales Ratio Jason McCaslin, SAMA Secretary Thomas May, SAMA, AAS Silent Auction Jane Grossinger, SAMA Site Selection Luis Rosario, SAMA Jake Pidde, AMA Stearns County Strategic Planning Marvin Anderson, SAMA Summer Seminar Coordinator Kim Jensen, SAMA, CAE Tax Court / Valuations Laura Fridgen, SAMA Treasurer Reed Heidelberger, SAMA
Educational Workgroups Amber Hill, CMA Assessor Standards Michael Stalberger, SAMA Polk County Assessor Development Patrick Chapman, SAMA Course Management Tina Diedrich-Von Eschen, SAMA Course Curriculum Joy Kanne, SAMA Education Kim Jensen, SAMA, CAE New Members Scholarship Kelly Schroeder, SAMA ? Coming Soon!
2 Equal Eyes | Fall 2016 Our Cover Photo: Heidelberg, Germany by Tobias Vonder Haar IN 8 THIS Global Assessment: ISSUE... Germany
IN EVERY ISSUE FEATURES
Commissioner’s Comments 5 Presidential Perspective 6 COMMERCIAL PROFILE: MAAP Update 7 GERMAN-BASED Transitions 22 13 Classifieds 23 ALDI GROCERY STORES
Out of the Past 24 AMA/SAMA Designees 26 BEERVIEW: What You Get For... 29 Assessing the Tax Court 30 Local Ale 18 State Board of Assessors 58
* The statements made or opinions expressed by authors in Equal Eyes do not necessarily represent a policy position of the Minnesota Association of Assessing Officers.
3 Equal Eyes | Fall 2016 From the Editor:
Fall Greetings Fellow Assessors:
As fall sets in and winter approaches it is time to reflect on the summer of 2016. I found that we had a strong market this summer with sales launching skyward again. We recently sold our home in Baxter after only nine days on the market, and saw other properties in our area sell just as fast. I also noticed a rise in new home construction compared to previous years. It is nice to see the market bounce back from the downward slide that has plagued us over the past few years. Have a safe fall finishing up your quintiles and measuring up your new construction.
Happy Harvest!
Jason Jason Jorgensen Equal Eyes Associate Editor
4 Equal Eyes | Fall 2016 Commissioner’s COMMENTS State Fair, #OurMN, and the Property Tax Refund Program Written by Cynthia Bauerly Minnesota Commissioner of Revenue
Summer’s end in Minnesota means many dollars. We collaborated with other state (PTR), which includes the Homestead Credit things – but one of my favorites is the State agencies to showcase some of the State of Refund and the Renter Property Tax Refund, Fair. Growing up, I looked forward to the Minnesota’s greatest resources and services helps people whose property taxes – paid fair because as a 4-Her, taking an exhibit to – such as parks, education, clean water, and on their home or through their rent – are the fair was a culmination of a lot of work community programs. significantly high in relation to their income. and provided me with a chance to enjoy my But only if they file a refund claim. Many favorite fair foods with good friends. Now I We used web videos, Twitter, and Facebook people do not know about, or do not realize look forward to it for a different reason: the to start the conversation. Then we encouraged they may qualify for, a PTR. chance to speak directly with our customers people at the fair and online to join in; they at the Minnesota Department of Revenue’s could post a photo or tweet with the hashtag To help spread the word, I encourage you to information booth. #OurMN to share what they love about our promote the PTR program at budget and levy state. (Revenue even had a “selfie” booth hearings. As in the past, we can provide you Each year, the department sets up shop in the at the fair.) with the PTR handout we used at the State Education Building to remind Minnesotans Fair so you can make it available at these about the Property Tax Refund, K-12 You can watch the videos through our public hearings. Contact our Property Tax Education Credit and Subtraction, and tax website. Go to www.revenue.state.mn.us Information & Education section for details. credits for military veterans. Of course, we and click the YouTube icon at the bottom of work hard all year to make sure people know the page. To learn more about this campaign It was great seeing so many of you at about who qualifies for these tax benefits and search the hashtag #OurMN on Twitter. the MAAO Fall Conference. We always how to receive them, but there is no better appreciate the opportunity to share opportunity than the fair to talk to so many Your MN information and to hear your ideas about people within such a short amount of time. how we can work together to improve our As we enter budget season, also known as property tax system. We all play a role More than that, however, our booth is a great autumn, I hope the state campaign helps in funding the future of our state and its opportunity to show people that Revenue highlight how your work ultimately helps communities. And we all have a stake in is about more than tax laws, forms and fund important local services and priorities. that future. instructions, and audits. Visitors respond to Working with assessors and other property our presence – with questions, ideas, praise tax officials is a crucial part of our job at Cynthia Bauerly is commissioner of the (more than you might think) and, yes, some Revenue, and we work hard to provide you Minnesota Department of Revenue. complaints and criticisms (fewer than you with the information and other resources might think). needed for your job. We are expanding our online training to make it easier to attend, I enjoy meeting people at the Revenue and to help ensure everyone can make the booth each year, discussing tax benefits best use of our data upgrades such as eCRV and the work we do at Revenue. It’s a great and the Property Tax Record Information reminder that – while opinions vary on System (PRISM). taxes and government services– we all pay to invest in our state and its future. And we Property taxes are a key source of local all benefit from these investments and the funding. However, because they are services they provide. based in part on property value – rather than ability to pay – property taxes can #OurMN disproportionately impact the budgets of low- and middle-income families (both During this year’s fair, Revenue led a renters and homeowners). campaign called #OurMN, a social media effort to highlight what we get for our tax The state Property Tax Refund program
5 Equal Eyes | Fall 2016 prESIDENT’S pERSPECTIVE Written by Nancy Wojcik Challenges MAAO President
It is already that time of year when our Many college students today, anticipate opportunities for your office, many college association transitions into a new fiscal year. selecting a major after they have an students are required to complete volunteer I can’t believe this last year has passed so opportunity to broaden their horizon and hours as a pre-requisite for graduation. quickly. I want to extend a thank you to explore many college courses and intern the MAAO membership for allowing me to opportunities. In addition, many high school As an organization, we will be focusing serve as your President this last year. It has students are now taking college courses in on expanding our horizons as we look been an honor, and a pleasure. I only wish their junior year of high school to lessen at expanding our avenues in promoting that we, as an organization could have had the financial burden of college costs, not the assessment profession and MAAO. the opportunity to address some Omnibus thinking about a future career. With this in Our focus on acquiring new members, tax bill issues with the legislature. I have mind, career recruitment begins much earlier offering scholarships and new education great confidence in the MAAO Executive than it ever has. opportunities will assist us in investing in Directors direction in the upcoming year. our current members and recruiting talented Many new ideas have been introduced for As a profession, we have a few colleges with employees into our profession. fruition in the next fiscal year. I want to a designated real estate major, that we can thank the Executive Directors, Committee focus on, but why limit ourselves to only I wish each and every one of you a wonderful Chairs, Committee Members, and those schools? Working in an assessment fall season, with your families, friends, and employees for their commitment in serving office, you are constantly undergoing co-workers, and as most of you know, “I’ll the membership. They are the heartbeat of computer changes and innovations, be on the computer 24/7”, so please drop our organization. I want to especially thank managing programs and workflow, handling me a note by email, phone or stop by any Lori Schwendemann, Online Coordinator, personnel issues, creating manuals and time, as I will always be of service to the Tina Diedrich-Von Eschen and Bob Wilson, training materials, reviewing surveys, members of MAAO. Weeklong Coordinators, for their years of blue prints and income and expense data, service to MAAO, as we transition their calculating figures, sketching, etc. This Best Regards, functions into the Education Coordinator listing of some of our duties covers majors position. They have all served MAAO and program areas of college and vocational Nancy Wojcik, SAMA for many years and their knowledge and schools that we may have never considered MAAO President 2015-2016 experience are invaluable. We will continue before. For example, have you thought to receive their input and insight in new roles to recruit students or employees from with MAAO. information systems, program management, human resources, surveying, engineering, As an organization we have many challenges accounting, business analyst, economic ahead, one of the top, for all assessing development, etc.? Have you considered offices is the recruitment and retention approaching colleges to participate in of employees. At our MAAO Executive job fairs? MAAO as an organization Board meetings I hear of so many personnel will be concentrating on collecting salary changes and retirements from each region. information across our state to assist This has been an area of growing concern assessing offices with the information to in the past but has become heightened assist them with reviewing staff salaries. by the retirement of many assessment We also will be focusing on providing professionals, and our professions salary association, career and education materials to inequity across the state. How do we work job and college fairs. I strongly recommend together to retain our employees and acquire your office get involved with student future employment candidates across the interns and summer temporary employment state? opportunities to expose students to our profession. I encourage you to think outside Most of us started college with a the box, offer a career investigation day predetermined college major and a career for students from the local high school or goal in mind. This is no longer the case. colleges. Think about offering volunteer
6 Equal Eyes | Fall 2016
2016 MAAP Summer Workshop
Written by Kelly Princivalli Carver County MAAP President 2016-2017
The annual MAAP Summer Workshop was held August 18-19, 2016 th MAAP Officers at the Holiday Inn Elk River, MN. The 35 annual summer workshop was a success, in part because of the speakers. Kicking it off on Kelly Princivalli Thursday morning was Gary Griffin, the Crow Wing County President 2016-2017 Assessor, discussing with humor, office policies and communication. Carver County Gary discussed different ways his county communicates with 952 361-1971 [email protected] taxpayers and how to provide them with valuable information also reaching out for feedback from the taxpayers in their district. There Melonie Flaws were very good ideas presented so I encourage anyone interested to Vice President 2016-2017 contact Gary. Always a favorite of MAAP, Jessi Glancey was there Crow Wing County 218-824-1302 with her co-workers, Adam Hupach, Jeff Holtz, Gretchen Buechler, [email protected] Taylor Forsyth and Mark Vagts to present on such topics as eCRV, MCAST, and PRISM. (Get ready PRISM is coming soon.) Some Jessica Arneson other topics covered: Secretary/Treasurer 2015-2017 Washington County Living by the Lake / Seasonal and Resort Classification. 651-430-6097 Legislative Updates / DOR Updates / Assessor Licensing [email protected]. Thank you to all our presenters! You are greatly appreciated. us
Michaelle Cronquist New officers were elected during the luncheon business meeting. For Past President 2016-2017 Vice President, Melonie Flaws from Crow Wing County was elected, Crow Wing County for Secretary/Treasurer, remaining for another year, Jessica Arneson 218-824-1015 [email protected] from Washington County, for Executive Board Member at Large, remaining for another year, Debbie Maresch from Carver County, for Debbie Maresch Conference Coordinator, also remaining for another year, Lisa Executive Board Member at Large Hawkins from Olmsted County, for Education Board Member, Lacy 2015-2017 Standke from Steele County and Amanda Lee, from Mower County. Carver County 952-361-1963 Elected to the Communicator and Directory, Kerry Stacherski, [email protected] Sherburne County and Emma Zachman, Hennepin County. Newly elected and remaining officers and board members were Lisa Hawkins congratulated and the outgoing officers and board members were Conference Coordinator 2015-2017 Olmsted County thanked for all the time they contributed to MAAP. 507-328-7655 [email protected] MAAO provided scholarships for recipients to use towards MAAP’s 2017 Summer Workshop registration. The scholarships were Amanda Lee awarded randomly during prize drawings throughout the seminar. Education Board Member at Large 2016-2018 The recipients of MAAO scholarships were: Cathy Olson - Aitkin Mower County County, Dawn Klein – Dakota County, Brenda Carlstrom – Dakota 517-537-6771 County, Kristi Haan – Washington County, Mary June Pekarek – [email protected] Benton County and Shirley Olson – City of Brooklyn Park. Lacy Standke Education Board Member at Large Thank you to MAAO for your continued support! 2014-2016 Steele County 507-444-7438 [email protected]
7 Equal Eyes | Fall 2016 GermanyGlobal Assessment:
Located in central Europe, Germany is made up of the North German Plain, the Central German Uplands (Mittelgebirge), and the Southern German Highlands. The Bavarian plateau in the southwest averages 1,600 ft (488 m) above sea level, but it reaches 9,721 ft (2,962 m) in the Zugspitze Mountains, the highest point in the country. Germany’s major rivers are the Danube, the Elbe, the Oder, the Weser, and the Rhine. Germany is about the size of Montana.
Written by Lori Thingvold, Wright County 8 Equal Eyes | Fall 2016 Equal Eyes Managing Editor FEATURE : Global Assessment: germany
gift tax.
The amount of tax payable is dependent on the nature and value of the property, while the personal circumstances of the property owner are almost always disregarded. The taxpayer is obliged to make quarterly payments on 15 February, 15 May, 15 Berlin August and 15 November. Tax rate is: from 2.6 to 3.5 per thousand for real property in the former federal area, from 5 to 10 per thousand for real property in the new landing, 6 per thousand for all agricultural and forestry undertakings. Tax on real estate Real estate tax in in Germany is transferred The Capital City of Berlin by Flok 70 (courtesy of Flickr.com to the local authority in which the property is located. The tax is also imposed, when buying at least 95 % shares of a company The 5th largest country in Europe, Ger- The Capital City of Berlin is also the largest many shares borders with nine other coun- owning real estate. The tax becomes due city in Germany. Berlin has more bridges tries: Denmark, Poland, the Czech Repub- one month after the tax assessment. The lic, Austria, Switzerland, France, Belgium, than Venice – Berlin boasts 960 bridges and tax basis rate is 3.5 %. By law there are Luxembourg, and the Netherlands. 59.8 square kilometres of water consisting certain exemptions, for instance: the purchase of real estate by persons related of lakes and around 180 kilometres of Germany was once a cluster of small in the direct line to the vendor or the navigable waterways. Combined with its kingdoms, duchies and principalities – purchase of real estate of low value (not which were unified as the German Reich surrounding state Brandenburg, it houses exceeding 2 500 EUR). (Deutsches Reich) in 1871. Later it became Europe’s largest inland water network. Inheritance and gifts tax the Weimar Republic, the Third Reich (Na- tional Socialism), and in 1949 the nation Currency: Inheritance tax and gifts tax are similar in divided into the Soviet-supported East Ger- Germany. When either the person making many (German Democratic Republic) and The German currency is the Euro. Actually, the gift (or the testator or the recipient of the democratic West Germany (Federal Re- the Euro is not “German money”, but it is the gift) and the heir is a German resident, public of Germany). On October 3rd 1990, the currency we use in this country. the tax applies also to assets that are East and West were reunited overseas. When neither the person making The Euro replaced the German Mark and it is the gift (the testator or the recipient of the Land Area the official currency of the European Union. gift) and the heir is a German resident, the
tax applies only to assets that are located The land area consists of 135,236 sq mi Nineteen states in Europe currently use the in Germany. When tax is imposed in a (350,261 sq km). The total area is 137,846 Euro. These states are Austria, Belgium, foreign country, the tax paid overseas sq mi (357,021 sq km). Cyprus, Estonia, Finland, France, Germany, will be deducted from the tax payable in Greece, Ireland, Italy, Latvia, Lithuania, Germany. As general rule, recipients of Population Luxembourg, Malta, the Netherlands, gifts (inheritances) are divided into three Portugal, Slovakia, Slovenia and Spain. The 2014 estimated population was groups: 80,996,685 1 Euro = $1.12 (U.S. Dollars) group 1 – a spouse, children Capital City group 2 – parents and grandchildren Taxation group 3 – all others Germany’s capital city has shifted seven times – these cities have all at one time Real estate tax The tax rates vary according to the above or another been capitals of the German groups and also depend on the value of the An owner of property has the right to republic: Aachen, Regensburg, Frankfurt- asset. The tax payable fluctuates between consume, sell, mortgage, trannsfer, and 7 % (group 1) and 50 % (group 3). There am-Main, Nuremberg, Berlin, Weimar, taxation exits: property taxes: real estate are certain exemptions that depend on the Bonn (and East Berlin), and, since 1990, tax, tax on real estate, inheritance tax and degree of family kinship. Berlin again.
9 Equal Eyes | Fall 2016 FEATURE : Global Assessment: germany, continued
Oktoberfest by Steve Collis courtesy of Flickr.com
Tourism Inventions their breakout.
Oktoberfest is the world’s largest Volksfest Germany boasts some of world’s most (beer festival and travelling funfair). Held famous inventions. You can thank the It’s illegal to run out of fuel in the German annually in Munich, Bavaria, Germany, it Germans for: the light bulb, the automated Autobahn – although not forbidden, is a 16-day folk festival running from mid calculator, the automobile, insulin, the motorists are only allowed to stop in the or late September to the first weekend in clarinet, the pocket watch, television legendary highway for emergencies, in October, with more than 6 million people (partly), paraffin, petrol/gasoline & which having an empty tank of gas is not. from around the world attending the event Diesel engines,the automobile engine, the Drivers can be fined and also have their every year. Locally, it is often simply called differential gear, the motorcycle, the jet licenses suspended for up to six months. the Wiesn, after the colloquial name of the engine, the LCD screen, and the Walkman. Walking or running in the highway system fairgrounds (Theresienwiese) themselves. is also illegal and is punishable by a fine of The Oktoberfest is an important part of Interesting Facts around EUR 90. Bavarian culture, having been held since 1810. Other cities across the world also hold Germany was the first country in the Oktoberfest celebrations, modeled after the world to adopt Daylight saving time – Germany has legal say on what babies can original Munich event. DST, also known as summer time. This be named – German laws ban names that occured in 1916 in the midst of WWI and don’t denote a gender or use a family name Beer was put in place to conserve energy. as a first name. In 2014, the most popular children’s names were Sophie/Sofie for a I can’t speak of Oktoberfest without girl and Maximilian for a boy. mentioning beer. Germany is Europe’s Prison escape is not punishable by law second largest beer consumer – Germans in Germany – German law maintains drank 2.55 billion gallons of beer in 2012, that it’s a basic human instinct to be free Fanta originated in Germany as a result the lowest level since the reunification in and therefore, prisoners have the right to of the Second World War – due to a trade 1990, but that’s still more than anyone escape jail. Escapes, however, rarely go embargo that prevented importing Coca- else in Europe apart from the Czechs. unpunished because prisoners are held liable Cola syrup into Germany, the head of There are more than 1,200 breweries if they cause damage to property or inflict Coca-Cola in the country decided to create producing over 5,000 brands of beer. bodily harm against any individual upon a domestic product for the market using
10 Equal Eyes | Fall 2016 FEATURE : Global Assessment: germany, continued available ‘leftover’ products like whey and building. Each apple pomace. It’s the second oldest brand of one of these four the Coca-Cola Company and its second most penthouses gets popular drink outside of the United States. its own large roof It’s consumed 130 million times every day garden terrace, around the world. which can be accessed through a staircase inside College education in Germany is free the apartment. even for internationals – tuition fees for Calm and private, bachelor’s degrees in public universities was hence the perfect abolished in 2014 due to politicians thinking place for hobby that having to pay for higher education as gardeners, sun ‘socially unjust’. worshipers and starlit sky Over 800 million currywurst are eaten obvservers. in Germany each year – currywurst is a sausage served with a spicy sauce, and is While the roof of one of the most prestigeous neighbourhoods a street food that has become a cult classic this old building is completely re-newed, the in a small and quiet side street of the well in Germany. About 7 million currywurst rest of the building receives a comprehensive known boulevard Kurfürstendamm, also are eated in Berlin alone. There’s even a refurbishment too, in order to fit the known as Ku’damm. museum in Berlin dedicated to the popular modern high standard of these outstanding snack. penthouses. The facade, staircase and The street is blessed with well preserved marmoreal entrance are put back to their initial glance. The existing elevator in REAL ESTATE FOR SALE old building and high grown trees. Only a few steps away however you the front building will be refurbished and FOR SALE: will find the sparkling life with many extended to the top floor; the back building 2 BEDROOM PENTHOUSE cafès, restaurants and boutique stores on the other hand will receive a completely PRICE: 880,000 Euros such as Gucci, Hermes and Louis Vuitton. new modern glass elevator. The full potential This is where two worlds are meeting: of the inner court is expressed with extensive the chic lifestyle and reflective idyll. greening, bicycle stands and a granite bench, welcoming people when they enter the
building. High up under the open sky, life feels complete.A green oasis is growing in between the urban happenings of the city, redefining the modern penthouse-lifestyle in the charming flair of the early 20th century.
The holistic experience of light and nature were the basis for creating the Luzia roofgarden penthouses concept. A peaceful, quiet and natural place for retreat within the pulsing city centre with a garden so close to the sky - Luzia roofgarden penthouses stand out with light-flooded rooms, wide views across the city skyline, galleries and “Luzia roofgarden Penthouses” are located in high ceilings in the roof of this precious old
11 Equal Eyes | Fall 2016 FEATURE : Global Assessment: germany, continued
FOR SALE: FARMHOUSE Description:
PRICE: 313,895 Euros Historic farmhouse and converted barn with much flair. Raversbeuren above Enkirch, Mosel. Ideal to live and work for artists and freelance occupations, or for keeping animals. Plot Size 6650 m² Details
Floor Area: 310m² Part cellar, 2 rooms. Ground Floor: Hallway, home office, open-plan living-/dining room with wood-burner, Former Farmhouse and converted barn kitchen with Spanish tiles and Heartland gas stove, conservatory, workshop extension.. Oil central heating First Floor: Hallway, bathroom with guilt lion-feet roll-top bath and large walk-in shower, bedroom with balcony, custom-built bed and copper spirals in the wall against Many historic features electromagnetic pollution, dressing room, 2 further large rooms, guest room with separate entrance from terrace. Separate apartment in barn
Large artists studios in barn
Beautiful courtyard and English-style garden
Separate grazing
Easy access Frankfurt-Hahn airport and Mosel Valley
EE
12 Equal Eyes | Fall 2016 COMMERCIAL PROFILE
German-based ALDI Generates Big Business in United Sates
By now, most of us have heard of, shopped at, or assessed, an Aldi store.
Aldi was started in Germany more than a century ago by the Albrecht family, and opened its first store in the United States in 1976.
Although ALDI has been in the United States in 1976, the German grocery recently announced an aggressive US expansion, with plans to open 650 more stores in 5 years.
ALDI FACTS
• Aldi is an abbreviation: It stands for Albrecht Diskont (Albrecht Discount)
• It’s actually two companies: Two sons took over the company in 1946 and split the operation into Aldi North and Aldi South.
• Aldi owns hundresd of stores in America. The grocer now operates nearly 1,400 U.S. stores in 32 states, primarily from Kansas to the East Coast.
• Aldi and Trader Joe’s are sister companies. Trader Joe’s is owned by a trust created by Aldi co-founder, Theo Albrecht.
• Aldi is huge, but private. Aldi is one of the largest privately held companies in the world. It ranked eighth in Stores Media’s 2015 survey of the world’s largest retailers.
• Aldi is cheap, but there are some drawbacks to shopping there. You’ll need to bag your own groceries, pay for your shopping bags, and pay a quarter deposit for your cart.
• Aldi’s rival, Lidl, plans to open its first U.S. store by 2018. EE
13 Equal Eyes | Fall 2016 1st Place Photo Contest Winner: Tim Graul, Ramsey County “Fairs, Festivals and Flea Markets”
14 Equal Eyes | Fall 2016
Fall Conference Sept. 25-28, 2016 - St. Paul
15 Equal Eyes | Fall 2016
Fall Conference Sept. 25-28, 2016 - St. Paul
16 Equal Eyes | Fall 2016
Fall Conference Sept. 25-28, 2016 - St. Paul
17 Equal Eyes | Fall 2016
Fall Conference Sept. 25-28, 2016 - St. Paul
18 Equal Eyes | Fall 2016 Assessing the Local Ale Written by Mike Vanderlinden Beerview: Wright County Beerview:
Kaleb Bessler, Cass County Fresh Snow - Ottertail Pennisula Leech Lake Area
19 Equal Eyes | Fall 2016 Feature: BEERVIEW
“He was a wise man who invented beer.” - Plato
there to play pinball and play the jukebox. reasons and to be honest I have made, and ir Fst, the fine print. I must disclose that (Revolution by the Beatles). The brewing drank, much worse beer. They feature four as I write this I am enjoying a handcrafted, side is very open and visable to patrons. “flagship” beers and fill in with seasonal black walnut stout, on tap from my garage. The floor was removed and the basement and specialty beers. This location was a For you see, I have been a hand crafty filled in to accommodate the equipment. The plumbing contractor in the day and has no homebrewer for at least 20 years. There floor joists were used to make the bar and hold on me. They have an exceptional patio are organizations and clubs and but have yet to install the heat for competitions, there is even a the late season. competition at the state fair, but I brew for fun and flavor. I also like to taste beer from, and at, Hayes Public House small regional breweries, craft is located in Buffalo with a view of breweries and nano breweries. Buffalo Lake, over the community The following list is just the local splash pad. A couple of young, list, Minnesota and Wisconsin local bearded fellows started this and it does not include any from brewery on a wing and a prayer, and Hennepin or Ramsey counties the heart of a true beer geek. They because there are so many it go the extra mile to create authentic would require its own research ales or “inspired old ales’ as they and article. What follows prefer. They employ oak barrels is not an endorsement nor a for aging and locally sourced cold panning of any establishment press coffee for their coffee porter. or their wares, but simply what They opened with a nitrogen tap as I experienced. Since I live in one of four taps which told me these Delano, and we have two micro guys liked beer, a lot. They are up breweries, I will start there. to nine taps now with occasional barrel tappings. The patio has a nice Lupine Brewing view but can be hot in mid summer as it is located on the west side of is located on River St in the building. Delano. It started in St Cloud brewing for distribution only the tables in the taproom. and did not have a taproom. When they Spilled Grain Brewhouse re-located to Delano they changed their South Fork Brewing business model and created a taproom and of Annandale has an impressive offering distrtibution brewery. The taproom side is also located in Delano, started as a wine of beers on tap. They specialize in single features reclaimed brick walls and original bar by a young, entrepreneurial, local couple. malt and single hop (SMaSH) beers that tin ceiling. Currently they offer 11 beers and It was closed for a period and retooled as a isolate specific flavors and aromas of certain Ginger Ale. The beer is good with a style full micro brewery. The beer is marginal, malts and hops. The open rafter design and for most palates. There is a lot of nostalgia they are more entrepreneurial than beer geek use of rustic corrugated metal and barnwood at this location as it was a café with a game and the excitement for their beer is shallow. give the place a nice feel with lots of seating room, back in the day, and I would go I still patronize the establishment for local inside and out.
20 Equal Eyes | Fall 2016 Feature: BEERVIEW, continued
Waconia Brewing New Glarus Brewing in Downtown WacTown has gained some is located in a little swiss village in central notoriety, locally, for their beer. With Wisconsin. There’s a swiss bakery, swiss four flagship beers and rotating seasonal sausage house, and of course a cheese selections they fit the standard taproom factory, Swiss Colony. The employee model. It’s easy to find but the parking can owned brewery was founded by a young be challenging depending on how far into entrepreneurial woman and currently your pub crawl you are. produces less than 300,000 barrels a year for distribution in Wisconsin only. The beer Lupulin Brewing garden is outstanding, though seasonal. The facility is almost overwhelming in size and Two words: Apricot Blonde. It’s a beer you sophistication. It would appear their capacity sicko, and it’s worth the trip to Big Lake. is a tad north of 300,000 and could easily be They have nice Chocolate Porter on nitro as August Schell Brewing distributed regionally. well. “Nitro” means that taps use nitrogen New Ulm, MN to push the beer instead of carbon dioxide. August Schell Brewing The benefit is smaller bubbles which makes it very creamy. Generally it is used on Bemidji Brewing began brewing in 1860 two miles outside of stronger, bolder beers to make it smoother New Ulm, they are still there today. Schells and less bitter. recently relocated and added a taproom. On has great beers, and that was before they opening day they featured six of their beers picked up the Grain Belt brand. I have served Lake Superior Brewing on tap. In their offering was a nice porter, Schells Dark at two weddings, it has a six the balance was adequate. The location is in dollar a glass flavor for two bucks a glass. of Duluth is Minnesotas first microbrewery. mixed redevelopment area one block off the The taproom is cool with a patio overlooking It is still run today by the original founder woolen mill outlet and surplus (cool stuff the Cottonwood River. The grounds are no who started it in the early 1990s. They for outdoorsy folk). It all has a nice feel longer than two miles from town but it feels had lots of help from UMD and local to it and they appear to have a solid local like it’s ten, surrounded by the brewery’s homebrewers, it was a true community customer base. deer park and Flandreau State Park. effort. They still feature their original creation; Special Ale. The brewery does not Castle Danger Brewery The brewery sponsers events year round and have a taproom but they do have a tasting my fav is Bockfest in February each year. room where you can sit down and order my in Two Harbors has fantastic deck It’s a German Mardi Gras, the Sat before Fat all time favorite oatmeal stout, Sir Duluth overlooking Lake Superior. You could Tuesday. It’s the day they release their Bock Oatmeal Stout. Try it on Nitro! spend hours watching The Lake and the Beer. There is music (lots of Johnny Cash), barges and enjoying a responsible amount Bock brats with kraut and several bonfires Dubh Linn Brew Pub of excellent craft beer. The rest of the year around the brewery grounds. At the bonfires you will have to watch from all the windows there are volunteer employees and family also in Duluth, is a bar, restaurant and nano and ample floor space inside. Try the Castle who will stir your beer with a hot poker from brewery. A nano brewery makes beer in 2-8 Cream! the fire. This hot poker will caramelize some keg batches. It allows them to experiment of the unfermented sugar and give the beer and develop unique, exotic flavors. Good Minhas Brewing notes of caramel. I think it makes the foam food, great beer, Minnesotas largest whiskey taste like roasted marshmallows, if the poker collection and hammerschlagen. Party on! formerly Huber Brewing in Monroe is hot enough. Proste! Wisconsin, is a craft brewery, brewing between 100,000 to 300,000 barrels a year Well that’s the list, I hope one, or more, has Lakefront Brewing as opposed to a micro brewery which brews piqued your interest. The next step should less than 100,000 barrels a year. They brew be for each region to do a chauffeured is located in Milwaukee, WI. It boasts one of 44 different brands on contract and 50 of pub crawl, in the interest of equalization. the top brewery tours in the nation, the coup- their own labels. Honestly, much of what I Potential elements of comparison could be de-ta of the tour is the bottling line featured tasted was unremarkable with very subtle value per barrel, value per tap, etc. COD in the Laverne and Shirley TV series. At the differences. The stand out was the Chocolate would become coefficient of draft. PRD end of the tour is beer sampling and a cash Bunny Stout. They claim to be the second would become popcorn related drinking. bar in a giant beer hall. They do serve bar oldest brewery in America-1845, with I think you get the gist of it. Have fun, food. Best Pumpkin Lager ever! Yuengling being the oldest-1829. drink responsibly, and say no to light beer. EE
21 Equal Eyes | Fall 2016 NTER OUR PHOTO CONTEST Transitions Best WishesUponRetirement
Compiled by Nancy Gunderson, SAMA Editorial Committee Member
Cindy Bowman Sherburne County
Cindy never guessed in 1997 that she’d be saying good-bye to nearly 20 years of fruitful employment in the assessing world. Cindy was introduced to this world at the City of Maple Grove, working for three years and moving on to the City of Plymouth for the next 14 years, earning her AMA in 2012. An unexpected bump in the road hit in 2014 when the administration at the City of Plymouth made the decision to outsource assessing services to Hennepin County. Cindy was grateful to be hired by Sherburne County at the age of 62 and was graciously welcomed by a wonderful staff.
Cindy would like to especially thank Nancy Bye, Jan Olsson, and Steve Berenbrinker for being positive influences in her success as a residential appraiser. She will miss all her friends and colleagues that she made along the way. Cindy is content and happy to move on to retirement, hoping for many healthy years to continue enjoying her family, grandkids, and friends.
Cindy’s retirement date is November 1st from Sherburne County. We all wish her the best in retirement.
Congratulations, Cindy!
22 Equal Eyes | Fall 2016 Classifieds 2206 Parklands Lane, Minneapolis
Frank Lloyd Wright designed home for sale for the first time since it’s construction in 1960.
Built into the side of a hill the home boasts 1,877 square feet on the main floor and 770 square feet below.
There are 3 bedrooms, 1 full bath, 1 partial bath, and fireplace all on the main floor. Located at the end of a cul-de-sac on 3.77 acres.
Listed in June for $1,495,000. Taxes for 2016 are approximately $14,809 EMV for payable 2016: $904,800
23 Equal Eyes | Fall 2016 https://www.coldwellbankerhomes.com Out OF tHE Past Written by Jason Jorgensen, SAMA Remembering Yesterday Meeker County Equal Eyes Associate Editor
2011 – 5 years ago 2001 - 15 years ago 1986 - 30 years ago
• Lane Thor, Julie Hackman, • In remembrance of 9/11 • Paul Knutson was victorious Ryan Short, And Mark in the Championship Meili were awarded SAMA 1996 - 20 years ago Volleyball Playoffs, but designations. received broken ribs in the • Tom May was hired as the process. • Judy Hahn, retired from Hennepin County Assessor. Sibley County after 23 years • The State Board of Assessors of service. • Lorna Thomas was awarded focused on licensure levels at with her SAMA. their meeting. • Member Clicks just released the new iPhone and iPad app • Mike Sheehy was a candidate for the MAAO website. for 2nd Vice President.
• The St. Louis Cardinals • Madeleine Albright is defeated the Texas Rangers 6-2 appointed as first female US in game seven of the World Secretary of State. Series. • Six-year-old Jon Benet • World population: Ramsey was found dead in her 6,928,198,253 billion. basement. 2006 – 10 years ago 1991 - 25 years ago
• Jacquelyn Betz, MDOR, was • Dorothy McClung was the Associate Editor for Equal seated as the Commissioner of Eyes. Revenue.
• Larry Johnson, 1955-2006, • Membership for MAAO City Assessor for Alexandria increased by 14 people raising Passed away after a struggle the overall members to 494. with amyloidosis. • Roger Storey received his • Gloria Erickson, retired from award for 25 years of service Pennington County Assessor from MAAO. after 30 years of service. • Median Household • The “Crocodile Hunter was Income: $30,126. killed by a stingray” Steve Irwin on September 4.
24 Equal Eyes | Fall 2016 2nd Place Photo Contest Winner: Gianna Olson, Hennepin County “Fairs, Festivals and Flea Markets”
25 Equal Eyes | Fall 2016 Meet Minnesota’s New
AMA & SAMA
Designees Written by Jake Pidde, AMA Stearns County Editorial Committee Member
AMA: Accredited Minnesota Assessor
Brian Green Brian Green, Dakota County, was awarded the AMA designation in May, 2016. His education includes Assessment Laws and Procedures, Appraisal Principles, Basic Valuation Procedures, Mass NoPhoto Appraisal Basics, Basic Income Capitalization, Advanced Income Capitalization, MN Assessment Photo Administration, Highest & Best Use & Market Analysis and USPAP. Brian has been a SRA member Unavailable since May 1993 (equivalent to a residential narrative). Brian has a Certified General Non Residential Submitted Appraiser license number 40415205. Brian has 4 years of assessment experience. Congratulations to you Brian!
Holly Soderbeck Holly Soderbeck, Department of Revenue, was awarded the AMA designation in May, 2016. Her education includes Assessment Laws & Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, MN Assessment Administration, Special Topics Workshop and USPAP. Holly’s Demonstration Form Report passed the grading committee in November 2015 and she passed the Photo ResidentialPhoto Case Study Exam in December 2015. Holly has 3 years of assessment experience. Congratulations to you Holly! Unavailable Unavailable John Mott John Mott, Hennepin County, was awarded the AMA designation in May, 2016. His education includes Assessment Laws & Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal No Procedures, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, MN Assessment Administration, Residential Modeling Concepts and USPAP. John’s Demonstration Photo Form Report passed the grading committee in November 2015 and he passed the Residential Case Submitted Study Exam in February 2016. John has 4 years of assessment experience. Congratulations to you John!
Continued on following page
26 Equal Eyes | Fall 2016 new designess, continued
AMA: Accredited Minnesota Assessor
Elisha Long Elisha Long, Isanti County, was awarded the AMA designation in May, 2016. Her education includes Assessment Laws and Procedures with Ethics, Bachelor’s DegreePhoto in Real Estate from St. Cloud State University (equivalent to Basic Appraisal Principles, Basic Appraisal Procedures, Elective and Residential Narrative), Mass Appraisal Basics, RealUnavailable Estate Finance and Investment, Income Approach to Valuation, MN Assessment Administration and USPAP. Elisha has 4 years of assessment experience. Congratulations to you Elisha!
David McNutt David McNutt, Douglas County, was awarded the AMA designation in May, 2016. His education NoPhoto includes Assessment Laws, History & Procedures, Residential Appraisal, Mass Appraisal Basics, UnavailablePhoto Basic Income Approach to Value, Income Approach to Valuation, Assessment Administration and USPAP. David’s Demonstration Form Report passed the grading committee in May 2005 and he Submitted passed the Residential Case Study Exam in December 2015. David has 15 years of assessment experience. Congratulations to you David!
Paul Grace Paul Grace, City of Minneapolis, was awarded the AMA designation in May, 2016. His education includes Assessment Laws and Procedures with Ethics, Mass Appraisal Basics, Basic Income PhotoNo Capitalization, Advanced Income Capitalization, MN Assessment Administration, Highest & Best UnavailablePhoto Use and Market Analysis and USPAP. Paul has a Certified General Residential Appraiser license number 4000926 and is a MAI member (equivalent to Principles, Procedures, two Income courses, Submitted elective, residential form appraisal report and both residential and income narratives). Paul has 4 years of assessment experience. Congratulations to you Pau!
Continued on following page
27 Equal Eyes | Fall 2016 new designess, continued
senior Accredited SAMA: Minnesota Assessor
Robin Nelson Robin Nelson, Washington County, was awarded the SAMA designation in May, 2016. Her education includes Assessment Laws, History and Procedures, Residential Appraisal, Techniques PhotoNo of Mass Appraisal, Basic Income Approach to Value, Income Approach to Valuation, Assessment UnavailablePhoto Administration and USPAP. Robin’s Residential Narrative Appraisal report passed the grading committee in June 2008. Robin had a successful oral interview with the Board in September 2008. Submitted Robin’s Income Narrative Appraisal report passed the grading committee in May 2016. Assessment experience since August 1998. Congratulations to you Robin!
Peter Preston Peter Preston, Blue Earth County, was awarded the SAMA designation in May, 2016. His education No includes Assessment Laws, History and Procedures, Residential Appraisal, Mass Appraisal Basics, Photo Basic Income Approach to Value, Income Approach to Valuation, MN Assessment Administration Photo and USPAP. Peter’s Demonstration Form Appraisal report passed the grading committee in May UnavailableSubmitted 2010 and he passed the Residential Case Study Exam in March 2011. Peter had a successful oral interview with the Board in November 2011. Peter passed the Income Property Case Study Exam in March 2016. Assessment experience since March 2005. Congratulations to you Peter!
Keith Triplett Keith Triplett, Wright County, was awarded the SAMA designation in May, 2016. His education includes Assessment Laws, History and Procedures, ProSource Residential Appraisal 101 – 104, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, Assessment Administration and USPAP. Keith’s Demonstration Form Appraisal report passed the grading committee in October 2010 and he passed the Residential Case Study Exam in October 2010. Keith had a successful oral interview with the Board in November 2010. Keith passed the Income Property Case Study Exam in March 2016. Assessment experience since September 2003. Congratulations to you Keith!
To recognize the accomplishments of new AMA and SAMA designees, we are spotlighting them when awarded by the State Board of Assessors. Are you a new designee? Get your photo ready!
28 Equal Eyes | Fall 2016 What you Get For....Farmland
Polk County - 80 Acres Sold December 2015 for $110,000 $1,375 / acre
Clearwater County - 80 Acres Sold August 2015 for $125,000 $1,562.50 / acre
Morrison County - 54 Acres 20 tillable acres Sold October 2015 for $99,000 $1,833.33 / acre
Becker County - 40 Acres Sold October 2014 for $75,000
$1,875 / acre
Polk County - 40 Acres Sold February 2016 for $110,000
$2,750 / acre
Stearns County - 40 Acres All Tillable—Sold March 2016 for $200,000
$5,000 / acre
29 Equal Eyes | Fall 2016 Tax Court: Blandin paper vs. “The Counties” Submitted by Jake Pidde, AMA Aitkin, Itasca, Stearns County Koochiching & St. Louis Editorial Committee Member
• Founded in 1901, the Blandin Paper Company owns and operates a paper mill located in Grand Rapids, MN.
• To provide a continuous supply of fresh wood for manufacturing, Blandin owns 4,680 parcels of tim- berland located in Aitkin, Itasca, Koochiching, and St. Louis Counties, consisting of approximately 187,000 acres.
• 156 petitions were filed.
Read the details of this very large tax court case on the following pages.
30 Equal Eyes | Fall 2016 STATE OF MINNESOTASubmitted by Jake Pidde, AMA Stearns County IN SUPREMEEditorial COURT Committee Member
A15-1666
Tax Court Dietzen, J.
County of Aitkin, et al.,
Relators,
vs. Filed: August 17, 2016 Office of Appellate Courts Blandin Paper Company,
Respondent.
______
Jay T. Squires, Rupp Anderson Squires & Waldspurger, PA, Minneapolis, Minnesota;
Michael J. Haig, Chief Assistant Itasca County Attorney, Grand Rapids, Minnesota;
James Ratz, Aitkin County Attorney, Aitkin, Minnesota; and
Nick D. Campanario, Assistant St. Louis County Attorney, Duluth, Minnesota, for relators.
Marc A. Al, Andrew P. Moratzka, Emma J. Fazio, Stoel Rives LLP, Minneapolis, Minnesota; and
Dennis L. O’Toole, Lano, O’Toole & Bengston, Ltd., Grand Rapids, Minnesota, for respondent.
Paul D. Reuvers, Jason J. Kuboushek, Iverson Reuvers Condon, Bloomington, Minnesota, for amici curiae Minnesota Association of Townships, Association of Minnesota Counties, Minnesota Association of Assessing Officers, and the Minnesota County Attorneys’ Association.
1
31 Equal Eyes | Fall 2016 tax court, continued
______
S Y L L A B U S
1. Appraisal evidence that uses the unit-rule method to determine the fair
market value of real property is admissible in a property tax proceeding provided that the
evidence has foundational reliability and the method used results in a determination of the
fair market value of each parcel before the tax court in accordance with Minn. Stat.
§ 273.12 (2014).Because the record does not establish that the appraisal evidence offered
by respondent satisfies these requirements, the tax court erred in admitting that evidence.
2. The tax court’s conclusion that the Conservation Easement reduced the
market value of the real property before the court is supported by the record.
Reversed and remanded for a new trial.
O P I N I ON
DIETZEN, Justice.
Blandin Paper Company (“Blandin”) filed 156 property tax petitions to challenge
the assessor’s estimates of market value, for purposes of property tax assessments, for
4,680 parcels of land constituting roughly 187,000 acres of land located in Aitkin, Itasca,
Koochiching, and St. Louis Counties (“the Counties”) for the January 2, 2010, and January
2, 2011, valuation dates. Before trial, the Counties moved to exclude evidence Blandin
offered regarding the unit-rule method for determining the market value of the property at
issue, arguing that the method was not recognized under Minnesota law and should not be
admitted into evidence. The tax court denied the Counties’ motion, and the consolidated
cases proceeded to trial. Over the objection of the Counties, the tax court determined that 2
32 Equal Eyes | Fall 2016 tax court, continued
the unit-rule method was admissible in property tax proceedings, adopted Blandin’s
appraisal values based on that method, and reduced the assessors’ aggregate market value
of the parcels for January 2, 2010, from $190,098,751 to $52,200,000; and for January 2,
2011, from $189,753,551 to $25,800,000. For the reasons that follow, we reverse and
remand for further proceedings consistent with this opinion.
Blandin Paper Company owns and operates a paper mill located in Grand Rapids,
where it manufactures lightweight coated paper used in magazines and catalogues. To
provide a continuous supply of fresh wood for its manufacturing operation, Blandin owns
4,680 parcels of timberland, located in Aitkin, Itasca, Koochiching, and St. Louis Counties.
The consolidated cases involve the January 2, 2010, and January 2, 2011, tax assessments
based on the market values of Blandin’s timberland properties.
The parcels are distributed among 78 taxing districts in the four Counties, and range
in size from one-half acre to more than 600 acres, for a total combined area of about
187,000 acres. The parcels vary with respect to physical attributes such as road access,
pond or stream frontage, topography, upland or lowland composition, and the amount of
timber on the parcel. Blandin has not sought to combine any of the parcels for property
tax purposes. Some, but not all, of the parcels are contiguous, but all of the parcels are
operated as a single economic unit—namely, a managed forest that supports the operation
of Blandin’s paper mill.
Blandin enrolled most of its forest property under Minnesota’s Sustainable Forest
Incentive Act (SFIA), Minn. Stat. ch. 290C (2014), for several years, including 2010 and
3
33 Equal Eyes | Fall 2016 tax court, continued
2011.1 Under SFIA, the State makes annual payments to the owners of forest land in return
for the owners’ agreement to practice sustainable forest management of those lands. See
Minn. Stat. §§ 290C.08, subd. 1, 290C.03. To enroll in SFIA, a property owner must agree
that the forest land is not and will not be developed in a manner inconsistent with SFIA
requirements. Minn. Stat. § 290C.04(a). Land must be enrolled in SFIA for a minimum
of 8 years, and the property owner must certify compliance with SFIA requirements
annually. Minn. Stat. §§ 290C.03(a)(4), 290C.05. Under SFIA, enrollees pay local ad
valorem property taxes, and later receive payments from the State. In 2009, the State
reduced the funding for SFIA by capping payments at $100,000 annually, later making that
cap permanent. See generally Meriweather Minn. Land & Timber, LLC v. State, 818
N.W.2d 557, 561-62 (Minn. App. 2012) (explaining the SFIA program and statutory
changes). As a result of this legislation, Blandin’s 2010 effective property tax rate after
SFIA reimbursements went from -$.30 per acre to approximately $7.91 per acre.
On July 8, 2010, Blandin granted a Conservation Easement to the State of Minnesota
for its forest land.2 Blandin granted to the State a perpetual Conservation Easement in and
to its forest land in exchange for $43,700,000. Blandin reserved the right to sell or transfer
the forest land, but Blandin’s successors were bound by the terms of the agreement.
1 Identifying the specific parcels of Blandin’s forest property that were enrolled in SFIA in any given year is not material to the issues before us in this appeal.
2 The Conservation Easement defines “protected property” to include the tax parcels that are the subject of this proceeding. For consistency, we use the term “forest land” to refer to the protected property that is subject to the Conservation Easement.
4
34 Equal Eyes | Fall 2016 tax court, continued
Finally, the easement required Blandin’s forest land to remain under unified ownership; it
could not be divided for sale, lease, mortgage, or license in any other form.3
In 2010 and 2011, the County Assessors in Itasca, St. Louis, Aitkin, and
Koochiching Counties followed the statutory procedures for valuing and assessing each of
the parcels that is the subject of this appeal. See Minn. Stat. §§ 273.11, .12 (2014).
According to the County Assessors, the aggregate value of Blandin’s parcels totaled
$190,098,751 for the 2010 assessment, and $189,753,551 for the 2011 assessment.
Blandin subsequently filed 156 petitions challenging those valuations. These petitions
alleged (1) that the assessors’ cumulative estimated fair market value for the parcels
exceeded the actual market value of the single economic unit represented by Blandin’s
forest land; and (2) that Blandin’s parcels were unequally assessed as compared with other
properties. The tax court consolidated the petitions for trial.
Before trial, the parties exchanged appraisal reports that addressed the market value
of the parcels as of January 1, 2010, and January 1, 2011. Both appraisers defined the
subject property as Blandin’s entire 187,000-acre, 4,680-parcel forest. Both appraisers
determined the “highest and best use” of the property was sustainable timber production.4
The Counties’ appraiser, Maxwell Ramsland, used a model to estimate the value for each
3 There are several additional exceptions that do not apply to this appeal.
4 The Counties’ expert described this use as “forest management activities,” which we understand to be another name for sustainable timber production. As there is no dispute regarding the highest and best use of the property, we adopt the phrase used by Blandin’s expert, “sustainable timber production,” to describe the use.
5
35 Equal Eyes | Fall 2016 tax court, continued
individual parcel included in the subject property. Blandin’s appraiser, Bret Vicary,
estimated the market value of the fee simple interest in the subject property as a single
economic unit based on his conclusion that the most likely purchaser of the property would
be an institutional investor that would purchase the property as a single economic unit.
Then, after considering comparable transactions involving forest land in other locations to
determine an aggregate value for the property, Vicary used timberland inventory data (and
in 2010, a factor to represent best-use potential value) to allocate a portion of the subject
property’s overall value to each of the four Counties, based on an average per-acre price.
Vicary’s appraisal method was referred to initially as a “larger-parcel rule” and later as the
“unit-rule method.”
The Counties filed a motion in limine to exclude Vicary’s appraisal evidence,
arguing that his unit-rule method is per se prohibited by Minnesota law, including by the
tax uniformity requirement of Article X, Section 1 of the Minnesota Constitution and the
Equal Protection Clause of the Fourteenth Amendment to the United States Constitution.
The tax court denied this motion, and then, because Vicary’s appraisals would be admitted
at trial, denied the Counties’ motion for summary judgment.
At trial, Vicary testified, consistent with his appraisal report, that the highest and
best use of the subject property was sustainable timber production, that the subject property
should be valued as a single economic unit, and that the resulting aggregate value should
be allocated to each County. Vicary testified that the aggregate value of the subject
property for the 2010 valuation date was $52,200,000 or $278 per acre, and for the 2011
valuation date was $25,800,000 or $138 per acre. The difference in value between the two 6
36 Equal Eyes | Fall 2016 tax court, continued
assessment dates, according to Vicary, was due in part to the Conservation Easement.
Vicary also presented evidence that the value of standing timber is a factor in determining
the value of the property on which the timber grows. Consequently, Vicary used
timberland inventory data (and in 2010, a factor to represent value for potential non-
timberland use in a small percentage of the total property) to allocate the aggregate value
into separate values for each of the four Counties.5
Ramsland’s report for the Counties stated that the aggregate value of the subject
property was approximately $177,000,000 for the 2010 valuation date, and $129,000,000
for the 2011 date.6 Ramsland considered comparable sales transactions, then relied upon
mass appraisal techniques to determine the value of each of the 4,860 parcels based upon
their individual characteristics, such as location, road access, and size.7
5 For the 2010 appraisal, Vicary allocated $1,421,160 to Aitkin County ($292/acre), $1,190,230 to Koochiching County ($209/acre), $5,064,068 to St. Louis County ($229/acre), and $44,524,542 to Itasca County ($287/acre). For the 2011 appraisal, he allocated $679,329 to Aitkin County ($138/acre), $540,413 to Koochiching County ($119/acre), $2,895,960 to St. Louis County ($132/acre), and $21,684,298 to Itasca County ($140/acre). After the close of Blandin’s case-in-chief, the Counties moved to dismiss for failure to state a claim, renewing their argument that Vicary’s unit-rule method was unlawful and failed to overcome the presumptive correctness of the assessors’ estimated market value. The tax court denied the Counties’ motion, noting that it had already ruled that Blandin’s appraisal evidence was admissible when it denied the earlier motion in limine.
6 Ramsland attributed a 25% reduction in value to the Conservation Easement for the 2011 valuation date.
7 In his report, Ramsland acknowledged that Vicary’s unit-rule method was a recognized practice in the timber industry, but was not recognized by Minnesota appraisers in the area of ad valorem property taxation. 7
37 Equal Eyes | Fall 2016 tax court, continued
Following trial, the tax court concluded that Blandin presented sufficient evidence
to overcome the prima facie validity of the assessors’ estimated market value of the
property, and to determine a market value for each parcel. The tax court ordered further
proceedings to determine whether extending Vicary’s allocation method to compute a per-
acre value for each of the affected 78 taxing districts (rather than merely the four affected
counties) would materially increase the accuracy of the final market value determinations
using Blandin’s unit-rule method. The tax court directed Vicary to supplement his report
by computing a per-acre value for 12 of the 78 affected taxing districts. After receiving
the parties’ submissions on this issue, the tax court held a further hearing to consider
Vicary’s supplemental report and computations.
On June 16, 2015, the tax court filed findings of fact, conclusions of law, and an
order for judgment. The court concluded that the highest and best use of the property for
both assessment dates was as a single economic unit for sustainable timber production.
The court reasoned that the most probable purchaser of the subject property, an institutional
investor such as a timber management organization or a timber real estate investment trust,
would use the unit-rule method to value the property. Further, the court concluded that
while Vicary’s allocation of the aggregated value of the whole to each county according to
the proportionate amount of gross timber value would materially misallocate value, the
same process for allocating value at the tax district level would not do so. The court
decided that the aggregated value should be allocated down to the 78 affected taxing
districts by: “(1) determining an average per-acre value for each taxing district based upon
8
38 Equal Eyes | Fall 2016 tax court, continued
the distribution of gross timber value; and (2) multiplying that figure by the total number
of acres lying within each taxing district.”
Vicary’s supplemental appraisal report, which the tax court accepted, expanded the
allocation process beyond the county level to individual tax districts, using the 12 sample
taxing districts the tax court identified to show how the process worked.8 For the 2011
valuation date the tax court concluded that the Conservation Easement reduced the value
of the property by $26,400,000. The court rejected the appraisal evidence presented by
Ramsland, concluding that his analysis was flawed and “entitled to no weight whatsoever”
because his appraisal was internally inconsistent, focused upon the wrong buyers, property,
and uses, and did not use a traditional sales comparison approach. The tax court then
ordered the Counties to recompute Blandin’s tax liability based on the allocation decision.9
The Counties appealed.10
8 For example, based upon timberland inventory data supplied by Blandin, Vicary allocated $5,064,068 of the total 2010 value ($52,200,000) to Saint Louis County, and computed an average of $229 per acre for land lying in that county.
9 The Counties moved for amended findings, conclusions, and a new trial, arguing that the tax court erred by: (1) denying their motion in limine; (2) excluding proposed evidence detailing the approach taken by the Counties to derive market values for each tax parcel; (3) excluding proposed evidence regarding the alleged lack of uniformity between similarly classed properties under Blandin’s valuation method; and (4) precluding the Counties from presenting evidence regarding the effect of the Conservation Easement on property value. The tax court subsequently issued an order dated August 28, 2015, which, except for an amendment to finding 6, denied the Counties’ motion.
10 The Counties did not appeal the tax court’s decision to reject Ramsland’s appraisal evidence. 9
39 Equal Eyes | Fall 2016 tax court, continued
I.
On appeal, the Counties first argue the tax court erred by concluding: (1) the unit-
rule method could be used to determine the market value for individual parcels in a property
tax proceeding; and (2) using the unit-rule method did not violate the tax uniformity
provision of Article X, Section 1 of the Minnesota Constitution and the Equal Protection
Clause of the U.S. Constitution.
We review a final order of the tax court to determine if the tax court lacked
jurisdiction, the tax court’s order is not justified by the evidence or in conformity with the
law, or the tax court’s order is affected by any other error of law. Minn. Stat. § 271.10,
subd. 1 (2014). Specifically, we review the tax court’s legal determinations de novo, and
we review its factual findings under the “clearly erroneous” standard. Cont’l Retail v. Cty.
of Hennepin, 801 N.W.2d 395, 398 (Minn. 2011). The tax court’s decision is clearly
erroneous if the decision is not reasonably supported by the evidence as a whole. Lewis v.
Cty. of Hennepin, 623 N.W.2d 258, 261 (Minn. 2001). We do not defer, however, to the
tax court’s valuation determination when the tax court has clearly misvalued the property
or has failed to explain its reasoning. Nw. Nat’l Life Ins. Co. v. Cty. of Hennepin, 572
N.W.2d 51, 52 (Minn. 1997).
Blandin argues that our review of the tax court’s decisions regarding the admission
of evidence is deferential. We agree. See Cont’l Retail, 801 N.W.2d at 399. But the
question we must resolve here is whether the tax court correctly applied Minnesota law in
making its evidentiary decisions. This is a question of law that we review de novo. See
Marlow Timberland, LLC v. Cty. of Lake, 800 N.W.2d 637, 640 (Minn. 2011). 10
40 Equal Eyes | Fall 2016 tax court, continued
The Counties argue that the Legislature has not expressly authorized the use of the
unit-rule method of valuation in a property tax proceeding, and therefore the tax court erred
in using this method to value Blandin’s forest land. To determine whether Blandin’s
proposed unit-rule method is allowed by Minnesota law, we first review the relevant law,
then describe Blandin’s valuation method, and finally apply the legal principles to the
Counties’ arguments on appeal.
A.
All property “shall be valued at its market value.” Minn. Stat. § 273.11, subd. 1
(2014). Market value is defined as “the usual selling price at the place where the property
to which the term is applied shall be at the time of assessment; being the price which could
be obtained at a private sale or an auction sale . . . .” Minn. Stat. § 272.03, subd. 8 (2014).
In determining market value for taxation, an assessor must “consider and give due weight
to every element and factor affecting the market value” as of January 2 of the year
preceding the year for which the taxes are payable. Minn. Stat. §§ 273.01, .12 (2014).
The market value of real estate is determined according to the property’s highest
and best use. Am. Express Fin. Advisors, Inc. v. Cty. of Carver, 573 N.W.2d 651, 659
(Minn. 1998). The highest and best use of a property is the one that is physically possible,
legally permissible, financially feasible, and maximally productive. Appraisal Institute,
Dictionary of Real Estate Appraisal 135 (4th ed. 2002). Moreover, “[w]henever a market
value opinion is developed, highest and best use analysis is necessary.” Berry & Co. v.
Cty. of Hennepin, 806 N.W.2d 31, 34 (Minn. 2011).
11
41 Equal Eyes | Fall 2016 tax court, continued
Evidence of the market value of real property is often introduced through appraisal
testimony, and the tax court enjoys broad discretion to admit or exclude such evidence.
Cont’l Retail, 801 N.W.2d at 399; see Minn. Stat. § 271.06, subd. 7 (2014) (stating the
rules of evidence apply to tax court proceedings “where practicable”). The testimony of
an appraisal expert is admissible provided that the witness is qualified, the opinion has
foundational reliability, and the testimony is helpful to the factfinder. Cont’l Retail, 801
N.W.2d at 399; Minn. R. Evid. 702. But the proponent of a novel theory must establish
that the proffered evidence is generally accepted in the relevant field. See Doe v.
Archdiocese of St. Paul & Minneapolis, 817 N.W.2d 150, 164-65 (Minn. 2012).
B.
During the tax court proceedings, the description of Blandin’s proposed appraisal
method evolved from the “larger-parcel rule” to the “unitary-valuation method.”11 The tax
court found that the unitary-valuation method, or unit-rule method, is a generally accepted
appraisal practice.12
The two valuation methods that Blandin introduced in this proceeding, the larger-
parcel rule and the unit-rule method, are separate and distinct. The larger-parcel rule may
11 Compare Blandin Paper Co. v. Cty. of Aitkin, No. 01-CV-11-375 et al., Order (Minn. T.C. filed May 23, 2013) (discussing the larger-parcel rule of appraisal proposed by Blandin’s appraiser) with Blandin Paper Co. v. Cty. of Aitkin, No. 01-CV-11-375 et al., Order at 2, 6-13 (Minn. T.C. filed Jan. 29, 2014) (discussing the unit-rule method of appraisal).
12 Blandin Paper Co. v. Cty. of Aitkin, No. 01-CV-11-375 et al., Order at 2 (Minn. T.C. filed Aug. 28, 2015).
12
42 Equal Eyes | Fall 2016 tax court, continued
be considered in eminent domain proceedings if the proponent demonstrates that there is a
unity of use such that the use to which the noncontiguous tracts of land are applied is so
connected that the taking from one tract of land in fact damages the other tract of land,
Minn. Stat. § 117.086, subd. 1 (2014) (stating “[i]n all eminent domain proceedings . . .
noncontiguous tracts of land may be considered as a unit for the purpose of the assessment
of the damages for a taking from only one of such tracts, provided that the use to which the
tracts are applied is so connected, that the taking from one in fact damages the other.”).
See, e.g., City of Crookston v. Erickson, 244 Minn. 321, 327, 69 N.W.2d 909, 914 (1955)
(adopting a rule that “where a part of an owner’s land is taken for a public improvement .
. . and the part taken constitutes an integral and inseparable part of a single use to which
the land taken and other adjoining land is put, the owner [can] recover the full damage to
his remaining property”) (internal quotation marks omitted); see also Larger Parcel,
Black’s Law Dictionary (10th ed. 2014); Appraisal Institute, Dictionary of Real Estate
Appraisal 160 (4th ed. 2002). Under the larger-parcel rule, the owner is entitled to damages
from the severance as well as for the value of the parcel taken. Larger Parcel, Black’s Law
Dictionary (10th ed. 2014). The larger-parcel rule is not applicable unless the owner
establishes a unity of ownership and unity of use. See Minn. Stat. § 117.086, subd. 1; City
of Crookston, 244 Minn. at 327, 69 N.W.2d at 914. Most jurisdictions also require
contiguity of the combined parcels unless strong evidence of unity of use is shown. Larger
Parcel, Black’s Law Dictionary (10th ed. 2014). Minnesota Statutes ch. 278 (2014),
however, does not adopt the larger-parcel rule in property tax proceedings.
13
43 Equal Eyes | Fall 2016 tax court, continued
The unit-rule method is used to value the entirety of a business, including all
property, as a going concern when the business enterprise is located in more than one
jurisdiction. The unit rule is defined as:
[A] method that values the property within a particular jurisdiction based on the fair share of the value of an operating enterprise of which the property is an integral part. The unit value concept values all the property as a going concern without geographical or functional division of the whole and includes tangible and intangible assets.
Appraisal Institute, Dictionary of Real Estate Appraisal 239 (6th ed. 2015).13
The Minnesota Legislature has adopted a unit-rule method to value the property of
railroads, utilities, and pipelines for tax purposes. Minnesota Statutes § 270.84 (2014)
directs the Commissioner of Revenue to annually “make a determination of the fair market
value of the operating property of every railroad company doing business in this state.” Id.
To do so, the Commissioner “employ[s] generally accepted appraisal principles and
practices which may include the unit method of determining value.” Id. Once valued, the
Commissioner apportions the value to the responsible taxing districts. Minn. Stat.
§ 270.86, subd. 1 (2014). Similarly, there are specific statutes that set forth a valuation
process for utilities and pipeline companies that use personal property in the State to deliver
or transport water, gas, or electricity. See Minn. Stat. §§ 273.37-.371 (2014). Other than
13 Historically, unit valuation was devised to address the difficult task of valuing a business as a going concern when the property of the business is located in more than one taxing district. James C. Bonbright, 2 The Valuation of Property 633 (1937). Courts generally disfavored such valuations, however, because of inaccuracies in the assessment method and inequities in how it was administered at the local level. See, e.g., People ex rel. Delaware, Lackawanna & W. R.R. Co. v. Clapp, 46 N.E. 842, 844 (N.Y. 1897) (stating that unit valuation “is misleading and impossible of application with any approach to justice or accuracy”). 14
44 Equal Eyes | Fall 2016 tax court, continued
for these regulated industries, the Legislature has not expressly adopted a state-wide
valuation method for multiple parcels held by one owner across multiple taxing districts.
C.
The Counties argue, in effect, that the name of these valuation theories is irrelevant.
The only valuation method authorized by the Legislature for a property owner such as
Blandin, according to the Counties, is the market value of each individual parcel. Thus,
we turn next to the relevant property tax statutes. The property tax statutes clearly state
that property taxes are assessed against individual tax parcels on the basis of market value.
See Minn. Stat. § 273.11, subd. 1 (stating “all property shall be valued at its market value”
and the assessor “shall value each article or description of property by itself”); see also
Minn. Stat. § 273.01 (“All real property subject to taxation shall be listed and ...each
parcel shall be reappraised at maximum intervals of five years.”); Minn. Stat. § 273.03
(“The auditor shall make . . complete lists of all lands or lots subject to taxation, showing
the names of the owners, if known; and, if unknown, so stated opposite each tract or lot,
the number of acres, and the lots or parts of lots or blocks, included in each description of
property.”); Minn. Stat. § 273.08 (2014) (“The assessor shall actually view, and determine
the market value of each tract or lot of real property listed for taxation . . . and shall enter
the value opposite each description.”). These statutes provide a limited mechanism for the
property owner to combine separate tax parcels. Minnesota Statutes § 272.46 (2014)
provides that the auditor may, upon written application of any person, combine legal
descriptions of contiguous parcels for property tax purposes when the applicant holds title
as property owner. But the auditor is not required to combine legal descriptions over 15
45 Equal Eyes | Fall 2016 tax court, continued
section lines when the parcels are located in different school districts or taxing districts.
Id. Blandin did not seek to combine any of the 4,680 parcels in question.
We have not previously resolved whether the unit-rule method and resulting
allocation of the aggregate value can be used in Minnesota property tax proceedings.14 In
Theobald v. County of Lake, 712 N.W.2d 180 (Minn. 2006), we refused to allow a taxpayer
to combine multiple parcels because, we concluded, the assessor’s duty was “to fairly
assess parcels of property as they are subdivided by the county auditor for tax purposes,”
and not to combine those parcels unless a proper motion to combine was made. Id. at 183
(citing Minn. Stat. § 273.08). In Marlow Timberland, LLC v. County of Lake, 800 N.W.2d
14 Blandin argues that we have “implicitly” endorsed or applied the unit-rule method in other cases. We disagree. None of the cases that Blandin cites involved multiple contiguous and non-contiguous parcels stretching across dozens of taxing districts. See 444 Lafayette, LLC v. Cty. of Ramsey, 830 N.W.2d 25, 27 (Minn. 2013) (describing the “subject property” and “three adjacent properties” in one county); Federated Retail Holdings, Inc. v. Cty. of Ramsey, 820 N.W.2d 553, 555 (Minn. 2012) (describing the county’s assessment of the fair market value of a tax parcel and a leasehold interest “in the parcel adjacent to the tax parcel”); Equitable Life Assurance Soc’y of the U.S. v. Cty. of Ramsey, 530 N.W.2d 544, 547 (Minn. 1995) (describing the “estimated market values of two contiguous parcels of real property”); Renneke v. Cty. of Brown, 255 Minn. 244, 244- 45, 97 N.W.2d 377, 378 (1959) (describing two “adjoining” parcels “located in the downtown district of Sleepy Eye”). The decisions the tax court relied on are also inapposite. See Bushaway Corp. v. Cty. of Hennepin, No. TC-13619, 1993 WL 190855, at *1 (Minn. T.C. June 4, 1993) (describing three parcels located in one taxing district, with one parcel “surrounded by” another parcel); Barry v. Cty. of Hennepin, No. TC-5561, 1988 WL 70689 (Minn. T.C. June 21, 1988) (valuing two adjacent parcels comprising a three-building apartment complex as a single unit and subsequently allocating value to each parcel); United Nat’l Corp. v. Cty. of Hennepin, No. 1482, 1983 WL 1026 (Minn. T.C. Apr. 21, 1983) (valuing three parcels comprising a shopping center as a single unit). These cases stand for the unremarkable proposition that tax parcels may be combined for property tax purposes. None of these cases address whether the unit-rule method is properly applied to value a collection of contiguous and non-contiguous parcels that stretches across multiple taxing districts in four counties. 16
46 Equal Eyes | Fall 2016 tax court, continued
637 (Minn. 2011), we considered whether the tax court properly dismissed a tax petition
that challenged the property taxes for 744 parcels located in four townships and two
unorganized territories in one county on the ground that the properties were over-assessed.
Id. at 639 (stating the taxpayer “purchased nearly 40,000 acres of real property located in
Lake County”). Although we reversed the tax court’s dismissal we did not address the
availability of the unit-rule method.
D.
With this background in mind, we return to the question of whether the unit-rule
method may be used by the tax court in a property tax proceeding. The Counties urge us
to conclude the unit-rule method is generally unavailable in a property tax proceeding, and
specifically that the property tax statutes require valuation on a parcel-by-parcel basis.
Blandin counters that real property must be valued based upon its market value and that
the unit-rule method is a reliable means by which to determine market value.
The tax court, agreeing with Blandin, rejected the Counties’ arguments. The tax
court reasoned that the statutes in question are administrative, not substantive, and have no
bearing on market value in this situation. We agree with the tax court that the applicable
standard pursuant to section 273.11 is market value, but we disagree that the statutory
directive for a parcel-by-parcel valuation can be ignored. Indeed, the property tax statutes
clearly provide that each tax parcel must be valued. See Minn. Stat. §§ 273.03,.08, .11
subd. 1, 273.12; see also Minn. Stat. § 272.193 (2014). Such a determination is not merely
17
47 Equal Eyes | Fall 2016 tax court, continued
administrative. Rather, a parcel-by-parcel determination is fundamental to the property tax
scheme established by the Legislature.15
On the other hand, the property tax statutes do not prohibit the use of the unit-rule
method when it has foundational reliability and results in a determination of the fair market
value of the subject properties in accordance with section 273.12. In fact, the property tax
statutes do not directly address the unit-rule method at all. Instead, the focus of the statutes
is on market value. The tax court concluded that the unit-rule method, which requires that
the owner or proponent of the method establish that the combined parcels operate as a
single economic unit, is generally accepted by the appraisal community.
We agree that the unit-rule method is generally accepted in the appraisal community
as a method to value an operating enterprise located in more than one jurisdiction in which
property is an integral part. We recognize that there is no generally accepted criteria for
the use of the unit rule in a property tax proceeding. But existing appraisal literature and
the larger-parcel rule provide guidance. See Appraisal Institute, Dictionary of Real Estate
Appraisal 160 (4th ed. 2002); Larger Parcel, Black’s Law Dictionary (10th ed. 2014).
Based upon relevant appraisal literature, we conclude the unit-rule method is not available
unless the proponent establishes a unity of ownership, unity of use, and contiguity of the
combined parcel. Contiguity of the land, however, may not be required if there is strong
15 We acknowledge that such a parcel-by-parcel determination in the case of 4,680 parcels may be tedious, but that is a determination required by the Legislature, not by this court. See, e.g., Under the Rainbow Child Care Ctr., Inc. v. Cty. of Goodhue, 741 N.W.2d 880, 890 (Minn. 2007) (recognizing that “tax policy choices are appropriately left to the political branches”). We also observe that Blandin had the right to apply to combine contiguous parcels within tax jurisdictions as provided for by Minn. Stat. § 272.46. 18
48 Equal Eyes | Fall 2016 tax court, continued
evidence of unity of use. Larger Parcel, Black’s Law Dictionary (10th ed. 2014).
Additionally, the proponent must show that the method results in a determination of the
fair market value of each parcel before the tax court in accordance with Minn. Stat.
§ 273.12.
We conclude that appraisal evidence that uses the unit-rule method to determine the
fair market value of real property is not prohibited in a property tax proceeding provided
that the evidence has foundational reliability and the method used results in a determination
of the fair market value of each parcel before the tax court in accordance with Minn. Stat.
§ 273.12. We defer to the tax court on matters clearly within its expertise, including when
and under what circumstances the unit-rule method should be applied in a particular case.
But the method must have foundational reliability and must be based upon the market value
characteristics of each property. Moreover, the unit-rule method is not available unless the
property owner establishes a unity of ownership, unity of use, and contiguity of the
combined parcel, although contiguity of the land may not be required if there is strong
evidence of unity of use. When the highest and best use of the real property before the tax
court is as combined parcels that operate as a single economic unit, that unity of use is
directly relevant to the market value of the property. Minn. Stat. § 273.12.16
16 The Counties argue that a unit-rule method cannot be used because Blandin failed to bring a motion to combine its properties under Minn. Stat. § 272.46. We disagree. Blandin gave notice that it intended to rely on the unit-rule method, and the Counties agreed that the highest and best use of the properties was as a single economic unit. The cases cited by the Counties are not relevant. See 444 Lafayette, LLC, 830 N.W.2d 25 (involving the valuation of real property that was benefitted by a parking easement, but not combining parcels across section lines); Federated Retail Holdings, Inc., 820 N.W.2d 553 (concerning
19
49 Equal Eyes | Fall 2016 tax court, continued
E.
We next examine whether Blandin’s unit-rule method, as presented in this case, has
foundational reliability. We observe that Blandin’s unit-rule method is significantly
different from the larger-parcel rule and unit-rule method that are generally accepted in the
appraisal community. Blandin’s method consists of two steps: (1) determining an
aggregated value of all properties that operate as a single economic unit; and then (2) the
allocation of the aggregated value into value determinations for each taxing district based
upon the presence of standing timber. We see three serious problems with Blandin’s
approach.
First, Blandin did not establish that all of the parcels are contiguous. The record
reflects that roughly 80% of the parcels appear to be contiguous. But the remaining parcels
are located well outside the area of contiguity and in some cases are a considerable distance
from Blandin’s paper mill. The tax court failed to explain why the lack of contiguity did
not detract from the use of the unit-rule method for these parcels, or why the remoteness
of certain parcels to the paper mill did not affect their highest and best use or their market
the valuation of real property that had a leasehold interest in adjoining property that “ran with the land”). These cases stand for the proposition that an adjoining easement and a leasehold interest must be considered when assessing market value, but neither stands for the proposition that multiple parcels must be combined to determine an aggregate value for property tax purposes. The other cases involving properties that were combined by agreement for tax purposes are also inapposite. See Equitable Life Assurance Soc’y of U.S., 530 N.W.2d at 547-48 (affirming the tax court’s valuation of a combination of two tax parcels together, with no allocation between the parcels); Renneke, 255 Minn. 244, 97 N.W.2d 377 (affirming the valuation of two parcels as one unit for tax purposes). 20
50 Equal Eyes | Fall 2016 tax court, continued
value. Any non-contiguous parcels should be excluded from the single economic unit
unless Blandin establishes unity of use.
Second, the unit-rule method offered by Blandin does not have a defined allocation
approach. See, e.g., Fla. E. Coast Ry. Co. v. Dep’t of Revenue, 620 So.2d 1051, 1055-57
(Fla. Dist. Ct. App. 1993) (applying the unit-rule method of valuation to determine ad
valorem taxes on a railroad company); see also Comcast Corp. v. Dep’t of Revenue, 337
P.3d 768, 772-73 (Or. 2014) (discussing the history of the unit rule and central assessment).
The tax court did not cite, and we are unable to find, an allocation methodology that is
generally accepted in the appraisal community. Minnesota’s property tax statutes require
that each parcel be valued based upon every factor and element that affects market value.
Minn. Stat. § 273.11, subd. 1; Minn. Stat. § 273.12. The risk of inaccuracies in Blandin’s
allocation method for 4,680 parcels, which relied on standing timber values, seems
apparent to us when the widespread distribution of the parcels is considered along with the
attributes beyond standing timber that are relevant to determining fair market value.
Third, the allocation method adopted by the tax court did not comply with the
requirement of the property tax statutes that an individualized determination of market
value be made for each tax parcel. Specifically, the tax court erroneously concluded that
it was appropriate to calculate the average per-acre value of the standing timber for each
taxing district, and then multiply that figure by the total number of acres lying within each
taxing district. This top-down approach (allocation of the whole value to the 78 taxing
districts) does not separately examine the unique characteristics of each parcel. The
myopic view that market value may be determined by the amount of standing timber on 21
51 Equal Eyes | Fall 2016 tax court, continued
the parcels in 15% of the taxing districts is contrary to Minn. Stat. § 273.12. Moreover,
the court’s determination that the highest and best use of the aggregated properties is timber
production is incomplete. The unit-rule method requires that there be a unity of highest
and best use. Thus, each parcel must have the same highest and best use. The court failed
to determine whether any parcel had a highest and best use other than timber production.17
Logically, any parcel in which timber production is not the highest and best use must be
removed from the unit-rule method analysis. Because the value determinations upon which
the tax court relied were based on gross timber averages and a single highest and best use
for the aggregated properties, the tax court’s determinations are contrary to Minn. Stat.
§ 273.12, which requires market value to be based upon the individual characteristics of
each parcel.
In sum, we conclude that appraisal evidence that uses the unit-rule method to
determine the fair market value of real property may be admissible in a property tax
proceeding, provided that the evidence has foundational reliability and the method used
results in a determination of the fair market value of each parcel before the tax court in
accordance with Minn. Stat. § 273.12. Because the record does not establish that the
17 While Vicary did consider other attributes for some of the parcels such as potential for recreational use, he did not indicate whether any parcel has a highest and best use other than timber production.
22
52 Equal Eyes | Fall 2016 tax court, continued
appraisal evidence offered by Blandin satisfies these requirements, however, the tax court
erred in admitting that evidence.18
II.
The Counties next argue that the tax court erred in reducing the January 2011
valuation due to the presence of the Conservation Easement. According to the Counties:
(1) the reduction in value is contrary to Minnesota law requiring that the fee simple interest
unencumbered by an easement be valued for property-tax purposes; and (2) the applicable
version of Minn. Stat. § 273.117 grants an assessor the discretion to ignore the easement
in valuing property, and the record does not support the tax court’s reduction in value. We
will address each argument in turn.
A.
Minnesota Statutes § 272.03, subd. 1(a), states that real property “includes . . . all
rights and privileges belonging to or appertaining to the land.” See also Federated Retail
Holdings, Inc. v. Cty. of Ramsey, 820 N.W.2d 553, 560 (Minn. 2012) (discussing covenants
that run with the land). Generally, an easement is an interest in real property consisting of
18 The Counties argue that application of the unit-rule method violates the tax uniformity requirement in Article X, Section 1 of the Minnesota Constitution and the Equal Protection Clause of the Fourteenth Amendment to the United States Constitution. According to the Counties, taxing a portfolio of commonly owned properties based on an allocated or contributory value, but taxing individually owned properties based on market value, violates the Minnesota and United States Constitutions. The Counties rely on Hamm v. State, 255 Minn. 64, 95 N.W.2d 649 (1959), and Orchard Gardens Country Club, Inc. v. Commissioner of Revenue, 294 N.W.2d 701 (Minn. 1980), to support their argument. Because we conclude that market value is an element of the unit-rule method, and more importantly, because we remand to the tax court for a new trial on all issues, we decline to address the Counties’ constitutional challenge. 23
53 Equal Eyes | Fall 2016 tax court, continued
the right to use or control the land, or an area above or below it, for a specific limited
purpose. Easement, Black’s Law Dictionary (10th ed. 2014); Appraisal Institute, The
Appraisal of Real Estate 75 (14th ed. 2013). A conservation easement typically restricts
the future land use of the property to preservation, conservation, wildlife habitat, or some
combination of those uses, although farming, timber harvesting, or other rural uses may be
permitted to continue. Appraisal Institute, The Appraisal of Real Estate 75 (14th ed. 2013).
An easement may or may not reduce the fair market value of the subject property depending
on the facts and circumstances. See Alvin v. Johnson, 241 Minn. 257, 262, 63 N.W.2d 22,
25 (1954) (stating that “[a]ppurtenant easements are factors definitely affecting values”).
The Counties rely on TMG Life Ins. Co. v. Cty. of Goodhue, 540 N.W.2d 848 (Minn.
1995), to argue that the market value of the property is its value on a fee-simple basis. In
TMG Life, we considered whether property before the tax court must be valued on the lesser
leased-fee or a fee-simple interest. Id. at 850-53. The petitioner had an ownership interest
in the property. The dispute centered on whether market value contemplates comparable
market rents, or the actual leased rent at the time of the assessment. Id. at 853. We
concluded that the county assessor was correct to use the higher market rent at a
comparable store to estimate the market rate. Id. We reasoned that when determining the
market value of property under Minn. Stat. ch. 278, the property is valued on a fee-simple
basis, not a leased-fee basis. Id. But TMG Life did not address whether a conservation
easement that burdens the subject property should be considered in determining its market
value. Consequently, TMG Life is inapposite.
24
54 Equal Eyes | Fall 2016 tax court, continued
Here, the Conservation Easement burdens the subject properties. Specifically, the
Conservation Easement imposes substantive restrictions upon the use of Blandin’s
properties, restricting their use and limiting Blandin’s ability to sell or transfer the
properties. Notably, both Vicary and Ramsland recognized that these restrictions
negatively affected the subject properties’ value.
B.
The Counties next argue that the applicable version of Minn. Stat. § 273.117 gives
the county assessor the authority to ignore the presence of a conservation easement on a
property, and that a reduction in value is not supported by the record.
The Counties’ argument is based to some extent on recent amendments to the statute
that governs valuation of conservation easements for property tax purposes. The statute,
Minn. Stat. § 273.117, was enacted in 1981, amended in 2008, and amended again in 2013.
The 1981 version of the statute provided that “[r]eal property which is subject to a
conservation restriction or easement shall be entitled to reduced valuation under this
section.” Minn. Stat. § 273.117 (1982).
The 2008 version of section 273.117 is applicable to the property tax valuations at
issue in this case. It provides that:
The value of real property which is subject to a conservation restriction or easement may be adjusted by the assessor if:
(a) the restriction or easement is for a conservation purpose as defined in section 84.64, subdivision 2, and is recorded on the property; (b) the property is being used in accordance with the terms of the conservation restriction or easement.
25
55 Equal Eyes | Fall 2016 tax court, continued
Minn. Stat. § 273.117 (2008). This version of section 273.117 replaced the requirement
that a conservation easement be factored into a property’s value with language giving the
assessor the discretion to account for a conservation easement on a case-by-case basis. Id.
In 2013, the statute was once again amended, and its current form prohibits an assessor
from lowering the value of real property due to the presence of a conservation easement.
Minn. Stat. § 273.117 (2014).
We conclude that when an assessor exercises his or her discretion under the 2008
version of section 273.117 and declines to adjust for the presence of a conservation
easement, that decision is reviewable by the tax court in accordance with Minn. Stat.
§ 278.01 (2014). Specifically, an assessor’s valuation is prima facie valid. Minn. Stat.
§ 271.06, subd. 6 (2014) (“[T]he order of the commissioner or the appropriate unit of
government in every case shall be prima facie valid.”); Minn. Stat. § 272.06 (2014)
(providing that the assessment is “presumed to be legal until the contrary is affirmatively
shown”). When a taxpayer challenges a property assessment, “there is a prima facie
presumption that the assessor’s valuation is proper, and the taxpayer has the burden of
proving that the assessment is excessive.” S. Minn. Beet Sugar Coop. v. Cty. of Renville,
737 N.W.2d 545, 558 (Minn. 2007) (quoting In re McCannel, 301 N.W.2d 910, 923 (Minn.
1980)).
In sum, the tax court’s conclusion that the Conservation Easement reduced the
market value of the parcels is supported by the record. However, because we remand the
case for a new trial on all issues, the tax court will have to decide what impact, if any, the
26
56 Equal Eyes | Fall 2016 tax court, continued
Conservation Easement has on the market value of the parcels under the valuation analysis
applied on remand.
III.
In sum, we conclude that appraisal evidence that uses the unit-rule method to
determine the fair market value of real property may be admissible in a property tax
proceeding, provided that the evidence has foundational reliability and the method used
results in a determination of the fair market value of each parcel before the tax court in
accordance with Minn. Stat. § 273.12. The elements of the unit-rule method are unity of
ownership, unity of highest and best use, and contiguity of the land. Contiguity of the land,
however, may not be required if unity of use is established.Because the record does not
establish that the appraisal evidence offered by respondent satisfies these requirements, the
tax court erred in admitting that evidence.
We acknowledge that this complicated proceeding rests on a voluminous record.
The trial before the tax court was largely occupied with resolving the difficult legal
question of whether the unit-rule method of valuation is available in a property tax
proceeding. We commend the tax court for conducting a fair trial that resulted in thorough
orders that clearly presented this difficult issue for our review. Although a considerable
record already exists, having concluded that the unit-rule method is available and limited
as set forth in this opinion, we believe that both parties should be given the opportunity to
present evidence in favor of their respective positions. Accordingly, we remand to the tax
court for a new trial on all issues.
Reversed and remanded. 27
57 Equal Eyes | Fall 2016 State Board of Assessors
KEITH ALBERTSON GARY AMUNDSON
BOBBI SPENCER
DAVE MARHULA JANE GROSSINGER
BRIAN KOESTER
DEB VOLKERT GREGG LARSON
58 Equal Eyes | Fall 2016 State BoardState of Board of A Assessorsssessors Meeting Minutes St. Michael City Center Tuesday, May 17, 2016
Provided by Bobbi Spencer Minnesota Department of Revenue Chairperson Brian Koester convened the meeting at 9:00am.
Board members in attendance were: Keith Albertsen Brian Koester Gary Amundson Gregg Larson Charlie Blekre Dave Marhula Jane Grossinger Deb Volkert
Keith Albertsen made a motion to nominate Brian Koester as chair and that nominations cease. Dave Marhula seconded the motion. The motion carried.
Keith Albertsen made a motion to nominate Gary Amundson as vice-chairperson and that nominations cease. Dave Marhula seconded the motion. The motion carried.
Deb Volkert made a motion to appoint Jane Grossinger to the CEH committee. Gregg Larson seconded the motion. The motion carried.
Minutes of the March 15, 2016 meeting were reviewed. Keith Albertsen moved to approve the minutes as amended. Dave Marhula seconded the motion. The motion carried.
Minutes of the closed portion of the March 15, 2016 meeting were reviewed. Dave Marhula moved to approve the minutes as amended. Charlie Blekre seconded the motion. The motion carried.
Updates Form Report Update
Submitted Approved Rejected Reports being Dates Reports Reports Reports Graded
July 1, 2013–December 31, 2013 6 6 0 0
January 1, 2014–June 30, 2014 10 9 1 0
July 1, 2014–December 31, 2014 13 11 2 0
January 1, 2015 – June 30, 2015 20 15 5 0
July 1, 2015 – December 31, 2015 14 12 2 0 Passed Reports Have not Received Received Received Not enough (7/1/2013January 1, 2016 – Ma–y 16, 2016 25 23 applied1 for 1 AMA SAMA CMAS experience 5/16/2016) AMA yet
76 35 3 7 31 0
Two Day Meeting: Tentative 2 day meeting has been confirmed for November 15 & 16. If interviews don’t fill up will cancel the second day. July Meeting: Conflicts with a board members calendar had to change the July meeting date from July 19, 2016 to July 26, 2016. Assessors who confirmed an AMA oral interview for July 19, 2016 were contacted and they all confirmed that July 26, 2016 would work for them. The board’s meeting date is now confirmed for July 26, 2016. Warning Letter Issued: The board issued a warning letter under Minn. Stat. § 270.41, subd. 3, on April 18, 2016 stating that the assessor worked as the city assessor without holding the appropriate Minnesota assessor licensure which was a violation of Minnesota Rules 1950.1020, subp. 4; and performing assessment/appraisal work involving commercial/industrial properties without having obtained a required Minnesota assessor license was a violation of Minnesota Statutes 273.11, subd. 13.
59 Equal Eyes | Fall 2016 state board of assessors meeting minutes, continued
Updates (cont.)
Notification Letter Issued: The board issued a notification letter to a city manager stating that the city has twice violated Minnesota Rules 1950.1020, subp.4, on April 19, 2016 by hiring an individual that did not hold a Minnesota assessor license as their city assessor. Outside Activity Discussion: An email was sent to the requester informing them of the board’s decision. MAAO Education committee update from Brian & Gary: MAAO is combining some of the new committees that were created a couple of years ago to enable better participation on them.
Course Completion Certificates: MAAO’s use of a two page completion certificate for three of their courses is causing issues for assessors and the board. Keith Albertsen made a motion that the State Board of Assessors will only accept one page course completion certificates effective July 1, 2016. Jane Grossinger seconded. The motion carried.
Approved Continuing Education Hours Requests
2016 Annual Residential Real Estate Summit – Cory Bultema requested CEH’s for this summit that was held on April 8, 2016 and sponsored by Minnesota Real Estate Journal. The board’s continuing education committee approved this request for 4 continuing education hours. 2016 MAAO Summer Seminars – Kim Jensen requested CEH’s for 12 different seminars that will be held on May 25 – 26, 2016 and sponsored by MAAO. The board’s continuing education committee approved this request for continuing education hours as requested. Advanced Spreadsheet Modeling for Valuation Applications - Maribelle Cushman requested CEH’s for this seminar sponsored by the North Star Chapter, Appraisal Institute. The board’s continuing education committee approved this request for 15 continuing education hours (includes a 1 hour exam). Appraising Manufactured Homes – Kim Nord requested CEH’s for this online course sponsored by McKissock. The board’s continuing education committee approved this request for 7 continuing education hours. Complex Litigation Appraisal Case Studies - Maribelle Cushman requested CEH’s for this seminar sponsored by the North Star Chapter, Appraisal Institute. The board’s continuing education committee approved this request for 7 continuing education hours. Construction Details & Trend – Nancy Fisher requested CEH’s for this online course sponsored by McKissock. The board’s continuing education committee approved this request for 7 continuing education hours. Fundamental Concepts of Analysis – Nancy Fisher requested CEH’s for this online course sponsored by McKissock. The board’s continuing education committee approved this request for 7 continuing education hours. IAAO 2016 GIS/CAMA Conference & Pre-Conference Workshop – John Jacobson and Michael Sheplee requested CEH’s for this conference that was held on February 22 - 25, 2016 and sponsored by IAAO. The board’s continuing education committee reviewed each request and approved continuing education hours. The number of continuing education hours was based on the number of instructional hours stated on the signed submitted Uniform Request for Recertification Credit document provided by the requesters. Income Approach for Residential Properties – Joe Haeg requested CEH’s for this seminar sponsored by the North Star Chapter, Appraisal Institute. The board’s continuing education committee approved this request for 7 continuing education hours. MNCCC Annual Conference – Darci Gawthrop requested CEH’s for this conference being held on June 6 – 9, 2016 and sponsored by MNCCC – MN Counties Computer Cooperative. The board’s continuing education committee approved five seminars for a minimum of 3 hours to a maximum of 5.25 continuing education hours.
60 Equal Eyes | Fall 2016 state board of assessors meeting minutes, continued
Approved Continuing Education Hours Requests (cont.) Real Estate Finance, Value & Investment Performance - Joe Haeg requested CEH’s for this seminar sponsored by the North Star Chapter, Appraisal Institute. The board’s continuing education committee approved this request for 7 continuing education hours. Residential Report Writing: More than Forms – Nancy Fisher requested CEH’s for this online course sponsored by McKissock. The board’s continuing education committee approved this request for 7 continuing education hours. The Appraiser as an Expert Witness: Preparation & Testimony - Maribelle Cushman requested CEH’s for this seminar sponsored by the North Star Chapter, Appraisal Institute. The board’s continuing education committee approved this request for 16 continuing education hours (includes a 1 hour exam). The Discounted Cash Flow Model – Concepts, Issues & Applications – Joe Haeg requested CEH’s for this seminar sponsored by the North Star Chapter, Appraisal Institute. The board’s continuing education committee approved this request for 7 continuing education hours. The New FHA Handbook 4000.1 – Kim Nord requested CEH’s for this online course sponsored by McKissock. The board’s continuing education committee approved this request for 7 continuing education hours. The Thermal Shell – Robert Brewster requested CEH’s for this online course sponsored by McKissock. The board’s continuing education committee approved this request for 3 continuing education hours. Understanding Residential Construction – Nancy Fisher requested CEH’s for this online course sponsored by McKissock. The board’s continuing education committee approved this request for 7 continuing education hours.
Request for Continuing Education Hours Susanne Barkalow requested the board review four seminars for continuing education hours that was offered at the Independent Fee Appraisers Annual Appraisal Conference. The conference was held on April 26 – 28, 2016 at Breezy Point Resort and sponsored by the MN Chapter of the National Association of Independent Fee Appraisers. . The Professional Appraiser: 2016 – 4 continuing education hours (offered on April 26) . 2016-2017 National USPAP Update – 8 continuing education hours (offered on April 27) . Current Issues in Appraising: 2016 – 2 continuing education hours (offered on April 28) . The Minnesota Economy: Forecasts & Risk for 2016 – 2 continuing education hours (offered on April 28) The two 2-hour seminars offered on April 28th are consecutive. One is from 8:00 am -10:00 am and the other from 10:00 am – 12:00 pm. They have separate approvals due to the different topics and presenters. All assessors who attended one is expected to attend the other as well, for a total of 4 hours that morning. Keith Albertsen made a motion to approve all of the seminars offered at the Independent Fee Appraisers Annual Appraisal Conference for the number of continuing education hours requested. Dave Marhula seconded. The motion carried.
Application for Certified Minnesota Assessor
David Hillstrom, St. Louis County, applied for the Certified Minnesota Assessor license. His education includes Assessment Laws and Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures and Mass Appraisal Basics. Assessment experience since April 2014.
Carissa McIlwain, Itasca County, applied for the Certified Minnesota Assessor license. Her education includes Assessment Laws and Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures and Mass Appraisal Basics. Assessment experience since June 2015. Carissa will meet the one year of assessment experience on June 1, 2016. Carissa’s CMA license will take effect on June 1, 2016.
Benjamin Puthoff, Nobles County, applied for the Certified Minnesota Assessor license. His education includes Assessment Laws and Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures and Mass Appraisal Basics. Assessment experience since April 2015.
Maria Shepherd, Hubbard County, applied for the Certified Minnesota Assessor license. Her education includes Assessment Laws and Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures and Mass Appraisal Basics. Assessment experience since October 2014.
61 Equal Eyes | Fall 2016 state board of assessors meeting minutes, continued
Application for Certified Minnesota Assessor, (cont.)
Heidi Stalboerger, Local Assessor working under Cheryl Foster in Stearns County, applied for the Certified Minnesota Assessor license. Her education includes Assessment Laws and Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures and Mass Appraisal Basics. Assessment experience since August 2014.
Gary Amundson made a motion to award the Certified Minnesota Assessor license to David Hillstrom, Maria Shepherd, Heidi Stalboerger, Benjamin Puthoff effective May 17, 2016 and Carissa McIlwain effective June 1, 2016. Jane Grossinger seconded the motion. The motion carried.
Application for Certified Minnesota Assessor Specialist Suzanne Bonnema, City of Minneapolis, applied for her Certified Minnesota Assessors Specialist license. Her education includes Assessment Laws, History and Procedures, Residential Appraisal Principles, Basic Valuation Procedures, Mass Appraisal Basics, Basic Income Approach to Value, Basic Income Capitalization. Suzanne’s Demonstration Form Appraisal report passed the grading committee in March 2016. Suzanne has 23 years of assessment experience. Dave Marhula made a motion to award the Certified Minnesota Assessor Specialist license to Suzanne Bonnema. Charlie Blekre seconded the motion. The motion carried.
Application for Senior Accredited Minnesota Assessor Robin Nelson, Washington County, applied for her Senior Accredited Minnesota Assessors license. Her education includes Assessment Laws, History and Procedures, Residential Appraisal, Techniques of Mass Appraisal, Basic Income Approach to Value, Income Approach to Valuation, Assessment Administration and USPAP. Robin’s Residential Narrative Appraisal report passed the grading committee in June 2008. Robin had a successful oral interview with the Board in September 2008. Robin’s Income Narrative Appraisal report passed the grading committee in May 2016. Assessment experience since August 1998. Gregg Larson made a motion to award the Senior Accredited Minnesota Assessor license to Robin Nelson. Dave Marhula seconded the motion. The motion carried.
Peter Preston, Blue Earth County, applied for his Senior Accredited Minnesota Assessors license. His education includes Assessment Laws, History and Procedures, Residential Appraisal, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, MN Assessment Administration and USPAP. Peter’s Demonstration Form Appraisal report passed the grading committee in May 2010 and he passed the Residential Case Study Exam in March 2011. Peter had a successful oral interview with the Board in November 2011. Peter passed the Income Property Case Study Exam in March 2016. Assessment experience since March 2005. Jane Grossinger made a motion to award the Senior Accredited Minnesota Assessor license to Peter Preston. Dave Marhula seconded the motion. The motion carried.
Keith Triplett, Wright County, applied for his Senior Accredited Minnesota Assessors license. His education includes Assessment Laws, History and Procedures, ProSource Residential Appraisal 101 – 104, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, Assessment Administration and USPAP. Keith’s Demonstration Form Appraisal report passed the grading committee in October 2010 and he passed the Residential Case Study Exam in October 2010. Keith had a successful oral interview with the Board in November 2010. Keith passed the Income Property Case Study Exam in March 2016. Assessment experience since September 2003. Jane Grossinger made a motion to award the Senior Accredited Minnesota Assessor license to Keith Triplett. Gary Amundson seconded the motion. The motion carried.
Appointments with the Board
Brian Green, Dakota County, met with the Board for his Accreditation Oral Interview. His education includes Assessment Laws and Procedures, Appraisal Principles, Basic Valuation Procedures, Mass Appraisal Basics, Basic Income Capitalization, Advanced Income Capitalization, MN Assessment Administration, Highest & Best Use & Market Analysis and USPAP. Brian has been a SRA member since May 1993 (equivalent to a residential narrative). Brian has a Certified General Non Residential Appraiser license number 40415205. Brian has 4 years of assessment experience and he applied for the Accredited Minnesota Assessor License. Dave Marhula made a motion to award the Accredited Minnesota Assessor license to Brian Green. Charlie Blekre seconded the motion. The motion carried.
62 Equal Eyes | Fall 2016 state board of assessors meeting minutes, continued
Appointments with the Board (cont.)
Holly Soderbeck, Department of Revenue, met with the Board for her Accreditation Oral Interview. Her education includes Assessment Laws & Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, MN Assessment Administration, Special Topics Workshop and USPAP. Holly’s Demonstration Form Report passed the grading committee in November 2015 and she passed the Residential Case Study Exam in December 2015. Holly has 3 years of assessment experience and she applied for the Accredited Minnesota Assessor License. Keith Albertsen made a motion to award the Accredited Minnesota Assessor license to Holly Soderbeck. Gary Amundson seconded the motion. The motion carried.
John Mott, Hennepin County, met with the Board for his Accreditation Oral Interview. His education includes Assessment Laws & Procedures with Ethics, Basic Appraisal Principles, Basic Appraisal Procedures, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, MN Assessment Administration, Residential Modeling Concepts and USPAP. John’s Demonstration Form Report passed the grading committee in November 2015 and he passed the Residential Case Study Exam in February 2016. John has 4 years of assessment experience and he applied for the Accredited Minnesota Assessor License. Gregg Larson made a motion to award the Accredited Minnesota Assessor license to John Mott. Deb Volkert seconded the motion. The motion carried.
Elisha Long, Isanti County, met with the Board for her Accreditation Oral Interview. Her education includes Assessment Laws and Procedures with Ethics, Bachelor’s Degree in Real Estate from St. Cloud State University (equivalent to Basic Appraisal Principles, Basic Appraisal Procedures, Elective and Residential Narrative), Mass Appraisal Basics, Real Estate Finance and Investment, Income Approach to Valuation, MN Assessment Administration and USPAP. Elisha has 4 years of assessment experience and she applied for the Accredited Minnesota Assessor License. Elisha’s AMA license will take effect on July 1, 2016 for the new fiscal year. Gary Amundson made a motion to award the Accredited Minnesota Assessor license to Elisha Long. Jane Grossinger seconded the motion. The motion carried.
David McNutt, Douglas County, met with the Board for his Accreditation Oral Interview. His education includes Assessment Laws, History & Procedures, Residential Appraisal, Mass Appraisal Basics, Basic Income Approach to Value, Income Approach to Valuation, Assessment Administration and USPAP. David’s Demonstration Form Report passed the grading committee in May 2005 and he passed the Residential Case Study Exam in December 2015. David has 15 years of assessment experience and he applied for the Accredited Minnesota Assessor License. Dave Marhula made a motion to award the Accredited Minnesota Assessor license to David McNutt. Gregg Larson seconded the motion. The motion carried.
Keith Albertsen excused himself from the interview with David McNutt since they both work for Douglas County. Paul Grace, City of Minneapolis, met with the Board for his Accreditation Oral Interview. His education includes Assessment Laws and Procedures with Ethics, Mass Appraisal Basics, Basic Income Capitalization, Advanced Income Capitalization, MN Assessment Administration, Highest & Best Use and Market Analysis and USPAP. Paul has a Certified General Residential Appraiser license number 4000926 and is a MAI member (equivalent to Principles, Procedures, two Income courses, elective, residential form appraisal report and both residential and income narratives). Paul has 4 years of assessment experience and he applied for the Accredited Minnesota Assessor License. Paul’s AMA license will take effect on July 1, 2016 for the new fiscal year. Deb Volkert made a motion to award the Accredited Minnesota Assessor license to Paul Grace. Gary Amundson seconded the motion. The motion carried.
63 Equal Eyes | Fall 2016 Discussion Items state board of assessors meeting minutes, continued
Discussion Items:
Rules Draft and SONAR: The board reviewed the rules and SONAR and made some changes. A rule sub-committee will further review the wording of the rules with the board’s attorney from the DOR Appeals & Legal Division.
Define Designations/Licenses: The following designations/licenses are equivalent to the corresponding education requirements.
Appraisal Institute: MAI is equal to Residential Appraisal Principles, Residential Appraisal Procedures, two income courses, elective, the Residential Form Appraisal report and both the Residential and Income narratives. SRA: is equal to Residential Appraisal Principles, Residential Appraisal Procedures, elective and a Residential narrative. IAAO: CAE is equal to Residential Appraisal Principles, Residential Appraisal Procedures, two income courses, the elective, the Residential Form Appraisal report and both the Residential and Income narratives. RES: is equal to Residential Appraisal Principles, Residential Appraisal Procedures, Mass Appraisal Basics, one income course, the elective and the Residential narrative. Dave Marhula made a motion to approve the designation equivalent to the corresponding designation, accept for the AAS designation. Gary Amundson seconded the motion. The motion carried.
Felony Policy: After much discussion it was decided to leave the board felony policy as is.
Challenge Exams and Seat Time: Tabled for July. (See handout) o Discuss sponsoring organizations policies for challenging exams. o Discuss sponsoring organizations policies for seat time. o Discuss CEH’s if an individual misses a substantial portion of a licensure course and passes the exam.
Assessment Experience: After much discussion it was decided to leave the assessment experience policy as is.
Revision to AMA Interview Questions: Review the revised list. Evaluate new questions that were added for the past two meetings. Tabled for July meeting.
BOA’s role in review of licensure courses: Decide on guidelines needed to move forward with developing criteria for courses, complaints, disciplinary actions, etc. Tabled for July meeting.
The chairperson set the next meeting date as Tuesday, July 26, 2016 at the St. Michael City Center in St. Michael at 9:00 am. Dave Marhula made a motion to pay the expenses for the meeting. Gregg Larson seconded the motion. The motion carried. Gary Amundson made a motion to adjourn the meeting. Deb Volkert seconded the motion. The motion carried.
64 Equal Eyes | Fall 2016 Official Publication of the Minnesota Association of Assessing Officers
65 Equal Eyes | Fall 2016