June 1, 2014

Kentucky Board of Tax Appeals Upholds Final Ruling of Cumberland County Board of Assessment Appeals for Four Acre Tract of Unimproved Land in Burkesville, Kentucky

Written By

By Erica Horn and Maddie Schueler

The Kentucky Board of Tax Appeals recently upheld an assessment for a four acre tract of unimproved land located at 317 Keen Street in Burkesville, Kentucky. See Taylor v. Cumberland County PVA, KBTA File No. K13-S-215 (Order No. K-24651, May 22, 2014). The Cumberland County Property Valuation Administrator (“PVA”) assessed the property at $80,000 for the 2013 tax year. The taxpayer valued the property at $50,000 in his petition of appeal. The Cumberland County Board of Assessment Appeals valued the property at $80,000, and the taxpayer appealed to the Kentucky Board of Tax Appeals (“KBTA”).

As the party seeking to set aside the assessment of the Cumberland County Board of Assessment Appeals, the taxpayer bore the burden of proving a lower value on appeal to the KBTA. The property at issue was zoned for commercial purposes. The taxpayer argued the value of the property was decreased because of water drainage issues. In support of his valuation, the taxpayer presented three residential land sales and a church land sale, ranging from $4,100 to $11,057 an acre.

The PVA relied upon two additional sales for approximately $20,000 an acre. One sale relied upon by the PVA occurred in 2011 for $20,000 an acre. There was only one building between the subject property and this sale. The taxpayer claimed he did not use this sale because it was too small. The other sale relied upon by the PVA was a 2012 sale of 2.59 acres of non­commercial river property that sold for $50,000. The taxpayer argued this sale was too far from Burkesville.

The Board noted that under Section 172 of the Kentucky Constitution, all property must be assessed for taxation at its fair cash value, which is estimated at the price it would bring at a fair and voluntary sale. The Board concluded the taxpayer did not meet his burden of showing the property was overvalued by the PVA for the year 2013. The Board noted that the non­commercial sales presented by the taxpayer were not comparable to the subject commercial property, located in the most expensive commercial area in Burkesville. The Board also found the PVA’s comparable sale of a property close to the subject property supported the PVA’s assessment. Therefore, the Board upheld the final ruling of the Cumberland County Board of Assessment Appeals valuing the property at $80,000 for tax year 2013.