INTRODUCTION
Perhaps few features of the federal constitution are more familiar
(or, at least, more litigated) than the guarantee that no person shall "be deprived of life, liberty or property, without due process of law." '
The legal process mandates that before any citizen is permanently deprived of property, they must receive meaningful notice regarding the government's intention to carry out such deprivation.
Individuals must be given a fair chance to prepare evidence and arguments to contest the government's proposed actions, as well as an adequate opportunity to present this information during a hearing before an impartial tribunal.
The inherent tension between due process requirements and the objectives of law enforcement raises an intriguing question: what if there were specialized police dedicated to upholding constitutional guarantees? These "Due Process Police" might advocate for a property tax assessment system that ensures landowners receive pre-deprivation notice of increased assessments and the opportunity to challenge them They would likely support a framework that allows for three levels of independent review by elected officials prior to the issuance of tax bills, emphasizing the importance of transparency and fairness in the assessment process.
The U.S Constitution's Fifth Amendment ensures that no individual can be deprived of life, liberty, or property without due process of law, a principle that is reinforced by the Fourteenth Amendment's Section 5, which applies to the states Similarly, the West Virginia Constitution echoes this commitment by stating that all individuals are entitled to due process and the judgment of their peers.
According to Article III, Section 10 of the Virginia Constitution, state courts may interpret the due process standard to provide a higher level of protection than that offered under the federal constitution in specific circumstances, as evidenced in cases like State v.
In West Virginia, the higher standard of due process, as established in Neuman, 371 S.E.2d 77, 80, Syl Pt 3 (W Va 1988), is primarily applied in criminal cases and has not been utilized in disputes regarding taxpayers' rights against government tax assessments Consequently, it can be inferred that the due process standards at both state and federal levels are the same when it comes to taxation issues.
2 Walter Butler Bldg Co v Soto, 97 S.E.2d 275 (W Va 1957); Simpson v.
3 State ex rel Moats v Janco, 180 S.E.2d 74, 80 (W Va 1971)
WEST VIRGINIA LAW REVIEW system, the Due Process Police would doubtless say: "Have a good day, and go on about your worthy business."
The Due Process Police would likely express concern over a property tax system that fails to notify property owners of increased assessments, as this undermines transparency and fairness They would also criticize a system that denies taxpayers remedies for not submitting required statements on time, as it disproportionately penalizes those who may face legitimate challenges Furthermore, the limited timeframe for the primary reviewing body to assess appeals before assessments become final raises questions about due process and adequate oversight Lastly, having the same body manage local government fiscal affairs while also reviewing tax base challenges could lead to conflicts of interest and a lack of impartiality in the assessment process.
"You are under arrest and you have the right to remain silent," would be the response to the latter system expected of the Due Process
In West Virginia, the review of property tax assessments is governed by a singular system, with the courts serving as the primary means of ensuring due process The judicial system has consistently upheld the validity of this framework and the outcomes it produces.
This article aims to critically examine West Virginia's property tax assessment review processes from a due process standpoint, highlighting the complexities and inconsistencies within the existing system It will explore the extensive body of case law surrounding these issues, alongside the contributions of practitioners, academics, and public stakeholders, ultimately advocating for a comprehensive reform of the current procedures.
4 The county commission sitting as a board of equalization and review (the board).
5 The county commission See inra note 19.
This article focuses solely on the procedural elements of the property tax assessment review process, intentionally excluding the separate topic of how property values are determined for assessment It emphasizes that the county assessor plays a key role in this system, ensuring clarity in the review procedures.
The State Tax Commissioner first assesses the true and actual value of a property, known as the "appraised" value Subsequently, a constitutionally mandated percentage of 60% is applied to this appraised value to calculate the "assessed" value.
PROPERTY TAX APPEALS SYSTEM officials and others to bring more fairness, uniformity and order into the system.
DuE PROCESS: THEORY AND APPLICATION
Constitutional guarantees of due process of law are not defined by a fixed set of procedures applicable to every situation where government actions threaten an individual's legal rights Instead, they represent a flexible framework, with requirements tailored to the specific context of each case.
Courts often employ a three-dimensional sliding scale standard when assessing due process adequacy, consistently focusing on a trio of factors that must be weighed and balanced in each case involving due process concerns.
The key considerations include the individual's interest impacted by government actions, the potential for wrongful deprivation of that interest under existing procedures, and the effectiveness of enhanced safeguards to mitigate such risks Additionally, it is essential to weigh the government's competing interests related to the specific function at hand and the potential fiscal or administrative burdens that may arise from implementing stricter safeguards.
In most matters involving taxation, courts have given the third factor substantially more weight than the other two, which results in relatively summary proceedings.'" This approach rests principally on
In a landmark decision, the U.S Supreme Court affirmed West Virginia's approach to selling lands with delinquent property taxes, emphasizing that tax assessment and collection laws are treated distinctly from other deprivation cases The court noted that such laws are interpreted generously in favor of tax collectors, as established in Turpin v Lemon.
The prompt and regular collection of revenues is vital for the effective functioning and survival of a government, as it plays a crucial role in maintaining an orderly society.
In cases where administrative actions impact private economic interests, such as tax imposition, due process does not require a full hearing before a judge It is adequate for taxpayers to receive notice and have the chance to present objections to an impartial administrative tribunal before any permanent deprivation of their tax dollars occurs Additionally, the ability to claim a refund for overpaid taxes, which were paid under legal obligation, fulfills the due process requirements.
Courts prioritize the government's interest in maintaining revenue stability over a taxpayer's right to avoid overpayment, often showing less concern for the latter As long as there is a basic process in place for taxpayers to challenge tax assessments, the efficiency of that process is rarely subjected to rigorous judicial examination.
Upon thorough analysis, the official processes for reviewing tax assessments frequently lack significance, especially for individuals and small businesses.
13 State v Sponaugle, 32 S.E 283 (W Va 1898) Compare, however, this view that
Taxation is a fundamental aspect of sovereignty, significantly influencing local government operations Prior to 1961, the Legislature established a fiscal timetable that guided these local entities in their financial management.
14 Sponaugle, 32 S.E at 284-85 See also Walter Hellerstein, Judicial Review of
Property Tax Assessments, 14 TAX L REV 327 (1959) [hereinafter Hellerstein, Judicial
The Court in Sponaugle overlooked the reason why the due process provision of the West Virginia Constitution, which emphasizes "the judgment of his peers," is not applicable in tax cases.
16 McKesson Corp v Division of Alcoholic Beverages & Tobacco, Dep't of Business
17 See Nancy J Stara, Property Tax Appeals: An Appeal for Practical Due Process,
PROPERTY TAXAPPEALS SYSTEM informal, uneven and hurried tax review procedures frequently conduct- ed in an institutionally biased environment make the risk of erroneous deprivation particularly acute.
Much of the case law in West Virginia regarding tax review mechanisms demonstrates a theoretical and often unrealistic perspective on due process questions.
A superficial judicial inquiry fails to recognize the significant barriers ordinary citizens face in accessing timely and meaningful review opportunities, highlighting the practical inaccessibility of the system Additionally, there is no substantial threat to government operations if measures are implemented to enhance the effectiveness of these reviews.
The Supreme Court of Appeals of West Virginia seems overly focused on the importance of the third factor, overlooking the inherent bias against protesting taxpayers within the tribunal responsible for their initial hearings Additionally, due to a recently reaffirmed minimum jurisdictional amount for case reviews, the court may be unaware of the challenging and often inconsistent requirements that impact these reviews.
68 NEB L REv 601 (1989) [hereinafter Stara, Property Tax Appeals]
Improvements in due process for taxpayers can effectively coexist with measures aimed at addressing significant threats to local government finances that are present in the current system.
The county commission currently serves two conflicting roles: it acts as the primary authority responsible for levying taxes and also functions as the sole body to adjudicate disputes regarding the county's tax base This dual responsibility raises concerns about potential conflicts of interest, as highlighted in the dissenting opinion in Rawl Sales & Processing Co v County Comm'n, 443.
S.E.2d 595 (W Va 1994), Justice Neely observed that:
THE CURRENT SYSTEM
A comprehensive study of the property tax assessment system should start before the initial administrative review This is crucial because actions or omissions by taxpayers or tax assessors at earlier stages have a significant impact on the subsequent review process.
Policy Issues
The upcoming description of the system will follow a chronological order, while the analysis will focus on the key policy issues it raises These significant issues will be clearly labeled and defined for clarity.
This article addresses the effectiveness of the system in notifying taxpayers about essential tax information reporting rules, the penalties for non-compliance, proposed property tax assessments, and the accessibility of general assessment data for comparison It also highlights taxpayers' rights to administrative and judicial review regarding challenges to property tax assessments.
25 For example, any tax information reporting default is grounds for later denying the offending taxpayer any review of his or her assessment See infra Part III.B.2.
26 See discussion infra part IlI.B.3.
The rules for tax information reporting, including the necessary details and practical deadlines for filing and amending property tax returns, often lack clarity and consistency.
Taxpayers may face significant consequences due to unclear tax information reporting rules, which can lead to severe penalties for non-compliance These penalties are often overlooked and infrequently enforced, yet they can accumulate and result in serious financial repercussions for those who fail to adhere to reporting requirements.
The system's inadequate provisions for taxpayer access raise significant issues related to the timely and comprehensive availability of assessment information, impacting both current and historical property assessments for taxpayers and their properties.
Time Table for Review The system's tightly constricted time table for administrative and judicial review of tax assessments presents prac- tical difficulties for taxpayers 3 "
The informal nature of administrative hearings can result in inconsistent practices, reduced accountability, and insufficient documentation for judicial review.
Institutional Bias Not only does the tribunal assigned to adminis- tratively review proposed tax assessments have a directly competing,
27 See discussion infra Part lI.B.1.
28 See discussion infra Part III.B.2.
Under the West Virginia Constitution, property taxation must be equal and uniform across the state, as outlined in Article X, Section 1 To contest the assessment of one's property, individuals typically compare their property assessment with those of others.
Part 1I.C.2 Moreover, to make meaningful the judicially recognized right to challenge the assessments of others, reasonable access to such information is essential See infra Part
Due process mandates that citizens are given sufficient time to prepare a response to any proposed deprivation, as established in Mullane v Central Hanover Bank & Trust Co (1950) Additionally, it necessitates a reasonable timeframe for individuals to file a protest against such proposed deprivations, as highlighted in Krupica.
31 See discussion infra Part III.D.4.
The property tax appeals system involves a complex interplay of official duties among local government officials, which can lead to ambiguity and potential conflicts in their roles during the review process.
Standard of Proof The degree of proof required of a taxpayer to overcome the presumed correctness of an assessment has varied widely under the case law in West Virginia."
Judicial review encompasses a diverse range of perspectives on the extent to which courts can assess the accuracy of outcomes from administrative assessment reviews.
Standard of Judicial Review Historically, the test to be applied by different courts reviewing the result of an assessment challenge admin- istrative hearing has lacked certainty and consistency.
The lack of uniformity in tax information reporting, inconsistent administrative hearing procedures, and institutional bias undermine the constitutional requirement for equal and uniform property taxes across the state.
Fiscal Time Table Local government officials share legitimate concerns about the continued integrity of well-established time tables for the adoption and implementation of their annual budgets 38
Lump-sum refunds for overassessed property taxes can disrupt the fiscal plans of local government bodies, as the system mandates the return of any excess payments made by property owners.
34 See discussion infra Part IlI.D.3.
35 See infra Part 1II.E.2 See also Davis, Separation of Powers, supra note 24; David
D Johnson, Jr., Note, Extent of Judicial Review of Administrative Tax Determinations in
West Virginia, 50 W VA L.Q 75 (1946) [hereinafter Johnson, Jr., Extent of Judicial Re- view]
36 See discussion infra Part III.E.3.
38 See discussion infra Part III.D.6 But see how much greater concern such officials should have had about those matters prior to 1961 See infra note 123.
39 See discussion infra Parts III.F.1 and lII.F.2.
Local governments face significant cash flow challenges when taxpayers delay payments of expected taxes due to ongoing judicial reviews of their assessments This disruption can hinder the effective implementation of fiscal plans, particularly given the strict timelines that local government bodies must adhere to.
Costs of Administration Modification of the system by the imposi- tion of additional duties and expenditures on local assessment adminis- trators is a natural concern of local governments.
Having labeled and defined the principal policy issues arising from the system, this Article next outlines the detailed steps in its process.
Tax Information Reporting Rules
Forms, Time and Place to File
Property owners must submit their property lists to the county assessor by October 1 of the year before the tax year However, natural resource properties must be reported to the state tax commissioner by September 1, while industrial property lists are also due to the Tax Commissioner by October 1.
Generally, property is reported on forms designed by the Tax
Commissioner which in the case of industrial property owners, also includes property to be reported to the assessor However, some asses-
42 W VA CODE § ll-lC-10(b) (1995) This provision is part of comprehensive property tax valuation legislation enacted in 1990 as House Bill 4127 (HB 4127) This part of the statute represents the Legislature's official recognition of the practical primacy which the state tax agency had long occupied with respect to the valuation of such properties The shift of official appraisal duties for such properties, from the assessors to the state tax agen- cy, was one component of a broader statutory scheme which the Legislature adopted that same year in a final effort to achieve the objectives of the statewide property reappraisal for tax purposes, which was mandated by a constitutional amendment W VA CONST art X, §
16, entitled Property Tax Limitation and Homestead Exemption Amendment of 1982, direct- ed the Legislature to provide for periodic revaluations of all property in the state for proper- ty tax purposes.
PROPERTY TAX APPEALS SYSTEM sors require the use of other, locally developed reporting forms for various kinds of property 43
The broad power of each county assessor, to make reasonable but thorough inquiries in carrying out his or her statutory responsibilities
The court has frequently affirmed the authority of individual assessors to require taxpayers to complete detailed questionnaires to accurately determine property values In tax administration cases, the court tends to interpret laws favorably towards the government and unfavorably towards taxpayers However, the potential impact of localized reporting practices on uniform taxation across the state has not yet been directly addressed by the court.
Property owners must notify the assessor of any improvements to real property that increase its value by over $1,000 within sixty days of starting the project Additionally, industrial taxpayers are required to report any improvements made in the past year by June 15 of the following year.
43 In a growing number of counties, assessors have developed their own unique re- porting forms to be used by individual (non-business) taxpayers in those counties in lieu of the standardized state forms While the information requested on these forms often differs from county to county, many of them do employ a potentially more convenient deck-of- cards or coupon-book type of format for different types of personal property However, these local forms seldom solicit information about an individual's real property or certain common types of taxable property such as television satellite dish antennas Interview with Robert A.
Hoffman, Director, Legal Division West Virginia Department of Tax and Revenue (July 28,
1995) [hereinafter Interview with Robert A Hoffman] Given that all interior household furnishings are exempt from taxation, these must be seen as major omissions.
44 Calhoun County Assessor v Consolidated Gas Supply Corp., 358 S.E.2d 791 (W.
In the case of Va 1987, an assessor pursued the identification of property owners through third-party lessees of the same property Similarly, in In re Assessment of Shonk Land Co (W Va 1974), the county assessor mandated the completion of a specific form for coal properties Additionally, the In re Assessment of Certain Real Estate of Eastern Assoc Coal Corp (W Va 1974) further illustrates the legal requirements surrounding property assessments in the region.
46 But see infra note 158, regarding the interplay between uniformity of administra- tive practice and uniformity of tax assessment result.
WEST VIRGINIA LAW REVIEW building permit has been obtained, delivery to the assessor of the per- mit constitutes sufficient compliance with the reporting requirement 48
As a practical matter, few individual, and only some business, taxpay- ers regularly comply with these additional tax information reporting requirements 49
Unlike most tax administration systems, there is no defined authority for officers to grant extensions or allow amendments to filed information Additionally, the current reporting forms are not user-friendly, lacking clarity in both format and content, and provide minimal guidance on filing requirements and the significant penalties for non-compliance.
Penalties for Defaults in Reporting Tax
Failing to submit timely and complete property reports may result in a rarely enforced penalty ranging from $25 to $100, along with the loss of any rights to review or correct property assessments Additionally, a penalty of 1% of the assessed value of unreported property can be imposed for each year, up to five years, prior to the discovery of the omission Moreover, neglecting to report improvements to real property is classified as a misdemeanor.
49 The number of individual taxpayers who file any property tax returns at all varies widely from county to county, sometimes falling as low as 30% and rarely exceeding 60%
The number of people submitting real property improvement reports is significantly low However, most assessors mitigate the impact of this non-filing by routinely reviewing building permit records from the issuing agency This practice effectively addresses potential issues, except in rural, unincorporated areas of counties lacking a comprehensive building permit system.
50 W VA CODE § 11-3-10 (1995) These penalties, including the denial of remedies for review and correction of erroneous assessments, apply to a failure or refusal "to deliver any statement required by law." Id Such quoted language has been held to include, not only the regular tax returns, but also any special, locally designed report required by a par- ticular assessor Shonk Land Co., 204 S.E.2d at 68 Moreover, the court has held that an assessor does not need to prove willfulness in sanctioning a taxpayer for non-compliance with such tax information reporting rules Id.; Eastern Assoc Coal Corp., 204 S.E.2d at 71
The property tax appeals system imposes penalties ranging from $10 to $100, which can seem harsh given the minor infractions that may lead to such fines It is concerning that the law does not provide any authority or grounds for reducing or eliminating these penalties once they are enforced.
Notice of Tax Information Reporting
Current property reporting forms lack information on penalties for non-compliance, only mentioning potential misdemeanor penalties for failing to report real property improvements However, these forms do specify the deadlines for submitting property reports.
Proposed Assessed Values, Taxability and Classi-
N otice
If the assessed value of a property is set to increase by more than 10% compared to the previous tax year, the assessor is required to provide written notice to the property owner This notice must be delivered at least 15 days before the county commission's first meeting in February, where it acts as a board of equalization and review.
52 W VA CODE § 11-3-3a (1995) Although assessors often have a ready means to discover such information unilaterally, see supra note 49, nothing in the law suggests that the assessor's actual knowledge of the improvement exonerates a property owner's default in not reporting the improvement The statute does provide that "delivery of a copy of the building permit to the assessor by the owner or the issuing authority shall be sufficient no- tice " W VA CODE § 11-3-3a (1995).
53 Despite massive non-compliance with the tax information reporting rules by indi- viduals, enforcement of the various penalties for non-filing is also virtually non-existent for such taxpayers Presumably, this lax enforcement is because local assessing officials recog- nize the harshness of such penalties Interestingly, there is authority for the view that tax- payers, who have not been provided, or even asked to file, lists of their real property, (such as in a county using local forms for only personal property), are not subject to the bar-of- all-remedies penalty for such non-filing Killen v Logan County Comm'n, 295 S.E.2d 689,
Under West Virginia law, if a valuation increase occurs across one or more districts, notice can be provided through publication to reduce administrative costs However, this requirement does not apply to personal property.
During board meetings, if an increase in a property's assessed value beyond the assessor's initial proposal is approved, the property owner must receive at least five days of prior written notice To streamline administration, individual written notices are not required for general valuation increases across an entire district, where publication of the notice suffices The specific contents of these notices are not mandated, and they often lack detailed information, such as the property's appraised and assessed values or comparisons to the previous year's assessment.
After a property owner submits their tax return and while the county commission is convened as the board, they can request information from the assessor about the classification and taxability of their property.
Access to Assessment Information
Although comparisons with other properties are the principal meth- od to challenge an assessment, present statutes contain no procedure
59 W VA CODE § 11-3-24a (1995) (emphasis added) "Taxability" refers to the ques- tion of whether, because of its use or nature, certain property is expressly exempted by the state constitution from the imposition of property taxes "Classification" refers to the consti- tutional tax rate class to which different kinds of property are assigned (e.g., owner-occupied residences are taxed under class 2, the maximum rate of which is one-half of the maximum rate imposed under class 4 on tenant-occupied residences located in a municipality) Howev- er, there is no current requirement that the assessor initiate notice to a taxpayer of any pro- posed adverse determination regarding his or her property's taxability or classification.
The Property Tax Appeals System ensures transparency by granting the right to access appraised values, proposed assessed values, and classifications of properties for taxpayers before the board meeting.
Administrative Review of Proposed Assessments
Allocation of Authority to Review
The county commission acts as a board of equalization and review, addressing inquiries about proposed property assessments These assessments are based on a constitutionally mandated percentage of 60% of the property's true value, as determined by the assessor Special properties, including natural resources and industrial properties, are appraised differently, reflecting their unique characteristics.
If the assessor disagrees with the property values set by the Tax Commissioner, they must provide valid reasons for not accepting these values.
Valuation Commission, a statewide body whose meetings are sporadic and infrequent at best 64
Recently, a statewide property reappraisal for tax purposes was completed, resulting in the revaluation of properties across 65 counties The total property valuation determined during this process was mandated to be submitted by the assessor.
60 Predictably, in the absence of any statutory mandate to do so, it is highly unusual for such information to be made readily available to taxpayers by county assessors Perhaps, this is an even greater impediment to exercise of the right to challenge another's assessment than it is to the right to object to one's own assessment At least, in the latter case, there is some limited right to notice See supra Part III.C.1.
61 The county commission, which now sits as a board of equalization and review in passing on disputed valuation matters, is one of the levying bodies whose operations are funded by property tax revenues, and, even more critically, it has an overarching constitu- tional duty for the superintendence of the county's fiscal affairs W VA CoNsT art IX, §
11 Except for certain requirements involving age and residency, there is no particular quali- fication to be elected and to serve as a member of the county commission.
63 W VA CONST art X, § lb; W VA CODE § 11-IC-1 to -13 (1995)
The county commission, acting as a board of equalization and review, is mandated to utilize the appraised valuations to establish the true and actual value for assessment purposes, as outlined by the West Virginia Law Review.
Property taxability and classification issues are initially addressed by the assessor If these matters remain unresolved, they are then escalated to the Tax Commissioner, who is required to make a ruling by February 28.
Clerical errors and unintentional mistakes in assessments can be corrected by the county commission within one year from when the property books are delivered to the sheriff or when the error is discovered However, this correction procedure does not apply to issues related to value judgments, classification, or taxability that are reviewed under Section 11-3-24a.
"any other such clerical error or mistake involving the classification or taxability of property, may be corrected only when approved in writing, by the county assessor." 69
66 W VA CODE § I1-IC-12(a) (1995) (emphasis added) The emphasized language appears to be the basis for the widely accepted view that, notwithstanding the Tax
The Commissioner is legally obligated to initially appraise special properties; however, the board maintains its existing authority to adjust any assessments to ensure that these properties reflect their true and actual value, as outlined in W VA CODE § 11-3.
67 W VA CODE § 11-3-24a (1995) As used in this context, the term "classification" refers to assignment of property to one of the four constitutional tax rate classes, supra note
The classification of specific property types, such as farm land, managed timber land, and pollution control facilities, is crucial for applying special valuation methods According to West Virginia Code §§ 11-3-1 and 11-IC-5, the authority to determine eligibility for these classifications lies with the assessor and the Tax Commissioner.
(1995)); in the West 'Virginia Division of Forestry for managed timber land (W VA CODE § 11-IC-11 (1995)); and in the West Virginia Division of Environmental Protection for pollution control facilities (W VA CODE § 11-6A-2 (1995)).
69 Id (emphasis added) Presumably, judicial review of an assessor's disapproval (of the correction of any such clerical error) may be sought through application for a writ of certiorari See discussion infra Part III.E.1.
While there is no required preliminary meeting with an assessor, they are typically open to discussing taxpayer objections before the February board meeting However, the practicality of these informal review opportunities is limited, as taxpayers are often not notified of their proposed assessments in time to arrange such discussions.
Form of Request for Review
The statutes do not specify the format for a property owner's request for review by the board; however, this is relevant when addressing issues related to taxability or classification.
Tax Commissioner, both the property owner and the assessor must make a sworn statement giving a full description of the property and certain other information which the Tax Commissioner requires 7
The Tax Commissioner has developed specific forms for taxpayers in certain counties to use when contesting their property assessments These forms necessitate the submission of information regarding the values of at least three comparable properties to ensure that the protest is taken into account.
Presumptions, Burdens, and Standards of
The statutes contain no prescription regarding the presumptions, burden, or standard of proof required in connection with administrative review of proposed assessments However, case law is clear that there
70 It is interesting to note that in both the prior statutes in West Virginia, and in the current practices of other states, a preliminary meeting with the assessor, to attempt to re- solve objections to assessments, was required as a prerequisite to any further review See, e.g., 1904 W Va Acts ch 4, § 18; Ky REV STAT ANN § 133.120(1) (Michie/Bobbs-
72 The form created by the West Virginia State Tax Department is entitled LGR
The West Virginia Law Review establishes a presumption of correctness for the assessor's proposed property value, placing the burden of proof on the property owner However, recent judicial rulings indicate a division regarding the standard of proof necessary for property owners to meet this burden and challenge the presumption effectively.
In a span of less than a year, the court issued two conflicting rulings regarding the burden of proof for objecting parties in assessment disputes The first decision established that an objecting party must demonstrate by a preponderance of the evidence that the assessment is incorrect Conversely, the second ruling required taxpayers protesting their assessments to provide clear and convincing evidence of their claims Notably, the latter decision did not acknowledge the former, and a decade later, the court reaffirmed the "preponderance of the evidence" standard in a per curiam opinion, referencing the earlier ruling This inconsistency raises questions about the court's interpretation of evidentiary standards in tax assessment cases.
In the Eastern American Energy opinion, the Land Co ruling emphasizes that taxpayers are responsible for demonstrating the inaccuracies of their assessments, as these assessments are initially presumed to be correct.
In the rapid legal landscape of the 1990s, the court swiftly reached a decision in just 28 days, a stark contrast to the previous decade's lengthy deliberations, once again referencing Pocahontas in its ruling.
Land Co emphasized that the responsibility lay with taxpayers to provide clear and convincing evidence to prove the tax assessments were incorrect However, in its recent ruling on the matter, the court decided not to follow the previously established whipsaw approach, as seen in the Maple Meadow Mining case.
73 In re Maple Meadow Mining Co., 446 S.E.2d 912, 916 (W Va 1994).
75 In re Tax Assessments Against Pocahontas Land Co., 303 S.E.2d 691, 699 (W.
76 Eastern Am Energy Corp v Thorn, 428 S.E.2d 56, 60, Syl Pt 3 (W Va.
77 Id at 57 (citing Pocahontas Land Co., 303 S.E.2d at 699).
78 Western Pocahontas Properties, Ltd v County Comm'n, 431 S.E.2d 661, 664 (W.
The court reaffirmed the "clear and convincing evidence" standard for administrative reviews of property tax assessments, but unfortunately, it did not address the implications for the Killen case.
U.S District Judge Haden's assertion that "West Virginia presently utilizes a burden of proof standard of 'clear and convincing evidence'" raises concerns about the clarity of guidance for ordinary taxpayers and officials The lack of precise language could lead to confusion regarding the fundamental distinction between different measures of proof, potentially undermining established legal standards Clearer direction is essential for those who must adhere to these rules, as ambiguity may inadvertently signal an intention to abolish long-standing legal distinctions.
The Tax Commissioner adheres to the principle that tax exemptions are interpreted narrowly against the claimant Additionally, a similar rule is applicable in cases involving classification disputes.
Hearing Process
Case law indicates that formal rules of evidence are not applicable in board proceedings, despite the absence of explicit statutes on the matter There is no requirement for witnesses to be sworn in, nor is there a formal process for receiving testimony.
The statutes lack clear guidelines on how to create a record before the board or the specific content it should include Additionally, there is no explicit mandate for the board to notify the affected taxpayer in writing about its decision, nor to provide an explanation for that decision Case law merely suggests that these practices should be followed.
81 CSX Transp., Inc., 871 F Supp at 900 (emphasis added).
82 In re Hillcrest Memorial Gardens, Inc., 119 S.E.2d 753, Syl Pt 2 (W Va 1961).
83 Based on the view that more favorable classification is in the nature of a partial exemption, in passing on such questions, the state applies the same rule of strict construction against taxpayers claiming the benefit of a lower classification Interview with Robert A.
WEST VIRGINIA LAW REVIEW [Vol 98:301 such proceedings need not be surrounded by extensive due process procedures 85
Parties and Counsel
All county citizens have the right to challenge property assessments before the board However, the statutory language lacks clarity regarding the other appropriate parties involved in these hearings, aside from the property owner and local residents, particularly in cases concerning significant natural resource properties While it appears that the assessor, who is responsible for the proposed assessments, would be the main party opposing taxpayer challenges, the statute presents some ambiguity regarding the assessor's role.
"shall attend and render every assistance possible [(to the board)] in
85 Id In Pocahontas Land Co., the inadequacy of the hearing before the board (de- scribed as "chaotic" by the parties) was exacerbated to the point of invalidity when one commissioner departed to coach a basketball game at 4 p.m of the last day when the board could conduct hearings, thereby depriving the board of the quorum needed for it to lawfully act 303 S.E.2d at 699-700 Similarly, in the earlier case of Crouch v County Court, 181
S.E 819 (W Va 1935), there was "a total lack of evidence in the record tending to estab- lish a basis for the valuations reflected in the assessment." Id While the cited cases rep- resent isolated events, insofar as judicial intervention to correct them may be concerned, this author, and every practitioner appearing before the various county boards, can recall incident after incident where unrepresented taxpayers have had to contend with unrecorded discussions of issues rather than sworn testimony, with 15-minute limitations on hearings, with unex- plained and unsupported rulings upholding assessments, and with many other such deficien- cies in making a reviewable record for the circuit court.
86 In Tug Valley Recovery, the court relied on language in Section 11-3-25 ("any person aggrieved") and the former version of Section 18-9A-1I ("any other interested party") to assert such right, which the court ruled, extended not only to other taxpayers but also to any "recipient of tax supported services." 261 S.E.2d at 174 Although Section 11-3-
Section 25 pertains to judicial review of assessments, while the former Section 18-9A-1 granted the right to seek a writ of mandamus in circuit court In the Tug Valley Recovery case, the court easily recognized the entitlement to administrative review This recognition aligns with the stipulation in Section 11-3-25, which states that its remedies are exclusively accessible to specific individuals.
"who shall have appeared and contested the valuation" before the board 261 S.E.2d at 169.
87 W VA CoI)E § 1-IC-10(d)(2) (1995) (requiring the Tax Commissioner to defend, before the board, against challenges to the appraisals of natural resource properties, having an assessed value of more than two million dollars, and challenges of the appraisal of any property owned by a person who owns or controls natural resource property in the county with an assessed value exceeding two million dollars).
In 1995, the property tax appeals system established that the value of assessed property can be contested Additionally, both the assessor and the board have the authority to seek assistance from the county prosecuting attorney during hearings related to these appeals.
The prosecuting attorney serves as the general legal counsel for the county commission, representing the interests of the state, county, and district during appeals related to the commission's rulings on various matters.
Such multiple roles of the assessor, and of the prosecuting attorney, simply compound at least the appearance of institutional bias against taxpayers in these proceedings.
6 Time Table for Administrative Review
Taxpayers looking to contest their current year assessment must submit their valuation challenges to the board during its scheduled meetings, specifically after the board convenes and before it adjourns.
89 In Pocahontas Land Co., the court explained the foregoing statutory language by describing a bifurcated process whereby, at the initial meeting of the board, it works collaboratively with the assessor in an administrative setting "to monitor the accuracy of the assessor's performance [in preparing the proposed assessments]." 303 S.E.2d at 700 (quoting
After correcting all evident errors, the court transitions to the second phase of the process, where it assumes its role as a quasi-judicial administrative tribunal to address taxpayer protests regarding the assessments.
Id Presumably, the assessor then steps down from his or her advisor role and reappears before the board as a litigating party defending such challenged assessments.
91 W VA CODE §§ 11-3-25, -27 (1995) If the case involves natural resource or industrial property, the state attorney general represents "the tax commissioner or the asses- sor" on appeal W VA CODE § 11-lC-10(h) (1995) By using the disjunctive "or" there, the Legislature may be said to have revealed its intent that the assessor is, in fact, the prop- er party appearing before the board in such matters W VA CODE § 11-1C-10(d)(2) (1995).
The right of appeal is typically granted solely to individuals who have litigated a matter in the lower tribunal However, the absence of any mention of the Tax implications raises concerns about the completeness of the process.
The Commissioner's role in presenting cases before the board, excluding significant natural resource property disputes, raises questions about the Tax Commissioner's right to appeal to circuit court The statutory language introduces ambiguity regarding this assumption, suggesting that while a harmonious interpretation of the relevant code sections is possible, the clarity of these provisions is lacking.
92 The board must complete its work to certify annual assessments of property at true
The West Virginia Law Review outlines that assessors must deliver proposed assessments by February 1, with the review process potentially adjourning between February 15 and February 28 These strict timelines are designed to ensure that the county's tax base is determined promptly, allowing local government bodies to finalize their annual budgets before the fiscal year begins on July 1.