Title: Polaris Amphitheater Concerts, Inc. v. Delaware Cty. Bd. of Revision

State: ohio

Issuer: Ohio Supreme Court

Document:

[Cite as Polaris Amphitheater Concerts, Inc. v. Delaware Cty. Bd. of Revision, 118 Ohio St.3d 
330, 2008-Ohio-2454.] 
 
 
 
POLARIS AMPHITHEATER CONCERTS, INC., APPELLANT, v. DELAWARE COUNTY 
BOARD OF REVISION ET AL., APPELLEES. 
[Cite as Polaris Amphitheater Concerts, Inc. v. Delaware Cty. Bd. of Revision, 
118 Ohio St.3d 330, 2008-Ohio-2454.] 
Taxation — Valuation of real property as distinct from improvements — Scope of 
appellate review is determined by the notice of appeal — Record does not 
support findings of the Board of Tax Appeals regarding land value — 
Decision reversed, and cause remanded. 
(No. 2007-0347 — Submitted January 23, 2008 — Decided May 29, 2008.) 
APPEAL from the Board of Tax Appeals, No. 2004-V-1294. 
____________________ 
 
PFEIFER, J. 
{¶ 1} Throughout the relevant period, Polaris Amphitheater Concerts, 
Inc. (“Polaris”) owned the five parcels at issue in this case, and those parcels 
collectively constituted the Germain Amphitheater, which was a venue for 
popular music concerts located in the city of Columbus and the Olentangy Local 
School District.  Polaris challenged the auditor’s valuation of the parcels for tax 
year 2003.  The primary focus of the challenge, both before the Delaware County 
Board of Revision (“BOR”) and the Board of Tax Appeals (“BTA”), lay in 
Polaris’s contention that the structures on the parcels did not constitute real 
property, but personal property.  If successful, this contention would have 
drastically reduced the assessed value of the property by eliminating that portion 
of the value associated with the improvements.  Ultimately, however, both the 
BOR and the BTA rejected Polaris’s attempt to recharacterize the improvements 
as personal property. 
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{¶ 2} On appeal to this court, Polaris does not take issue with the 
inclusion of the improvements in the real property tax base.  Instead, Polaris 
targets its appeal to the specific amount of value that the BTA allocated to the 
land as opposed to the improvements.  Polaris asserts that both its own appraisal 
and that presented by the Board of Education of the Olentangy Local Schools 
(“BOE”) show that the land had a much lower value than what the BTA found.  
Because this appraisal evidence was the only evidence of land value in the record, 
Polaris argues that the BTA’s finding of land value is not supported by probative 
evidence and should be reversed. 
{¶ 3} Polaris seeks to consider the land value in isolation from the value 
that the BTA allocated to the improvements.  By seeking reduction of the land 
value, and by not challenging the value allocated to the improvements, Polaris 
asks for an overall reduction in total value.  Indeed, Polaris’s notice of appeal and 
its brief seek a reduction in total value equal to the amount by which the land 
value is allegedly overstated. 
{¶ 4} The BOE opposes this request on two main grounds.  First, the 
BOE asserts as a jurisdictional matter that the total value of the property, both 
land and improvements, is always at issue in a valuation case and that Polaris 
cannot prevail because it has not contested the finding of the total value for the 
property.  Second, the BOE contends that in this particular case, any error in the 
value assigned to the land is merely an error in allocating value between land and 
improvements, not an error in determining the total value of the property. 
{¶ 5} We reject the BOE’s first argument.  The BOE relies on R.C. 
5715.19(A), which relates to the jurisdiction of the boards of revision and, 
derivatively, of the BTA.  R.C. 5715.19(A) does not define the jurisdiction of this 
court once a BTA decision has been appealed.  This court’s jurisdiction is 
governed by R.C. 5717.04, which requires that a notice of appeal “set forth * * * 
the errors therein complained of” in the BTA’s decision.  We have repeatedly held 
January Term, 2008 
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that the assignments of error set forth in the notice of appeal define the scope of 
our jurisdiction to grant relief to an appellant.  See Dayton-Montgomery Cty. Port 
Auth. v. Montgomery Cty. Bd. of Revision, 113 Ohio St.3d 281, 2007-Ohio-1948, 
865 N.E.2d 22 (“Dayton”), ¶ 32, citing Cleveland Bd. of Edn. v. Cuyahoga Cty. 
Bd. of Revision (1994), 68 Ohio St.3d 336, 337, 626 N.E.2d 933, citing Columbus 
Bd. of Edn. v. J.C. Penney Properties, Inc. (1984), 11 Ohio St.3d 203, 204-205, 
11 OBR 521, 465 N.E.2d 48. 
{¶ 6} Our unanimous decision last year in Dayton illustrates the point.  
In that case, the Dayton-Montgomery County Port Authority appealed the BTA’s 
determination of the value of its new office building in downtown Dayton.  The 
Port Authority contended that the actual-cost figures it presented to the board of 
revision constituted a more accurate valuation of its building than the figures used 
by the auditor.  Neither the Port Authority nor any other party had appealed the 
BTA’s determination of the valuation of the underlying land. 
{¶ 7} The BTA had found the value of the land to be $133,290, though 
the parties agreed that it should have been $316,620.  “The reduction of this figure 
to $133,290 appear[ed] to be clear error on the part of both the board of revision 
and the BTA.” Dayton, 113 Ohio St.3d 281, 2007-Ohio-1948, 865 N.E.2d 22, ¶ 
31.  Although the port authority had expressed at oral argument its willingness to 
stipulate to the higher land value, we held that we had no jurisdiction to correct 
the error in the land valuation because it was not the subject of an assignment of 
error in a properly filed notice of appeal: 
{¶ 8} “In spite of the agreement of the parties, however, we have no 
jurisdiction to effect a change of the land value from the value that the BTA 
found.  Our revisory jurisdiction over BTA decisions depends upon compliance 
with the statute, R.C. 5717.04, which requires that the appellant set forth in the 
notice of appeal the errors complained of in the BTA decision. Failure to so 
specify deprives the court of jurisdiction to grant a party relief on that ground. See 
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Cleveland Bd. of Edn. v. Cuyahoga Cty. Bd. of Revision (1994), 68 Ohio St.3d 
336, 337, 626 N.E.2d 933, citing Columbus Bd. of Edn. v. J.C. Penney Properties, 
Inc. (1984), 11 Ohio St.3d 203, 204-205, 11 OBR 521, 465 N.E.2d 48. 
{¶ 9} “* * * To preserve the question properly, either party aggrieved by 
the BTA's land valuation — the auditor or the board of education — should have 
filed its own appeal and specified the error. * * * Since that did not occur, we 
have no jurisdiction to correct the land valuation, and it follows that on remand 
the BTA likewise has no authority to depart from its previous finding that the land 
should be valued at $133,290.” Dayton, 113 Ohio St.3d 281, 2007-Ohio-1948, 
865 N.E.2d 22, ¶ 32-33. 
{¶ 10} Thus, Dayton makes clear that an appeal from the BTA’s 
determination of the value of real property does not necessarily place both the 
land and the building values at issue.  Consistent with Dayton, we hold that 
Polaris acted within its rights as a litigant to file a notice of appeal that challenged 
only the land valuation as a method of reducing the total valuation of the property. 
{¶ 11} The BOE’s second argument invites the court to exceed its 
jurisdiction and must therefore be rejected as well.  The BOE identifies as the 
“only apparent issue” the question of “how certain values are to be allocated 
between the land value and the improvement value,” with the result that “[i]f a 
reduction in the value of [Polaris’s] land is in order, then a corresponding increase 
in the value of the improvements would be proper.”  In other words, the BOE 
asserts a defense against the appeal by asserting that, even if the allocation is 
wrong, the total “true value” found by the BTA would still be correct, and the 
resulting taxes Polaris owes would not change. 
{¶ 12} Polaris responds by relying on Dayton, 113 Ohio St.3d 281, 2007-
Ohio-1948, 865 N.E.2d 22, ¶ 33.  Polaris argues that the BOE may not defend this 
appeal by arguing that any error in valuing the land is offset by an error in valuing 
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the improvements.  To do so, Polaris contends, the BOE would have had to file a 
cross-appeal.  We agree. 
{¶ 13} Our authority to review decisions issued by the BTA emanates 
from Section 2(B)(2)(d), Article IV of the Ohio Constitution, which states that 
this court’s appellate jurisdiction encompasses “[s]uch revisory jurisdiction of the 
proceedings of administrative officers or agencies as may be conferred by law.”  
(Emphasis added.)  The General Assembly conferred such appellate power on this 
court through R.C. 5717.04, and that statute strictly defines our authority to 
correct alleged errors committed by the BTA.  As we have already observed, R.C. 
5717.04 requires parties who seek review of a BTA decision to “set forth * * * the 
errors therein complained of,” and that mandate limits the scope of our appellate 
jurisdiction.  If the BOE wanted to invoke our jurisdiction to consider whether the 
BTA erred by assigning too little value to the improvements, then it had to file a 
cross-appeal setting forth that error pursuant to R.C. 5717.04. 
{¶ 14} The BOE suggests that it may advance its “mere misallocation” 
argument as an alternative ground for affirming the BTA’s decision in this case.  
That suggestion is incorrect.  Our cases do not permit us to rectify an alleged error 
of the BTA unless that error was set forth in a proper notice of appeal, even if the 
alleged error aggrieved the party only because of the success of another party’s 
appeal.  For example, in Christian Church of Ohio v. Limbach (1990), 53 Ohio 
St.3d 270, 560 N.E.2d 199, the BTA granted a tax exemption under R.C. 5709.07 
and did not reach the property owner’s additional claim of exemption under R.C. 
5709.12.  On appeal, we reversed the grant of exemption and further held that we 
had no jurisdiction to consider the additional claim of exemption because the 
owner had not filed a cross-appeal.  Id. at 271, 560 N.E.2d 199, fn. 1.  Similarly, 
in Lenart v. Lindley (1980), 61 Ohio St.2d 110, 15 O.O.3d 152, 399 N.E.2d 1222, 
the Tax Commissioner appealed a BTA decision that reversed an assessment that 
he had issued against a corporate officer.  The corporate officer asserted “a 
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number of alternative grounds upon which this court could affirm the BTA in the 
event that appellant’s challenge is well taken,” but the court found that it had no 
jurisdiction over such arguments.  Id. at 115, fn. 1.  Indeed, R.C. 5717.04 
expressly affords litigants in BTA cases the opportunity to preserve issues by 
filing a cross-appeal:  when one party to a BTA case files an appeal from the 
BTA’s decision, the other parties have at least ten days to file a cross-appeal.  
R.C. 5717.04. 
{¶ 15} In Dayton, 113 Ohio St.3d 281, 2007-Ohio-1948, 865 N.E.2d 22, ¶ 
33, we relied on both Christian Church and Lenart in support of our holding.  
Today, we again rely on those cases as we decline to exercise jurisdiction over the 
BOE’s argument that the challenge raised by Polaris involves a mere 
misallocation of value between land and improvements. 
{¶ 16} We now turn to Polaris’s central contention:  that the land value 
found by the BTA is not supported by the record.  We agree that it is not.  The 
BTA found that the auditor’s total valuation at $20,734,000 was supported by the 
BOE’s appraisal, which had set a total value of $21,000,000.  Next, the BTA 
adopted the auditor’s determination that the land was worth $13,799,100.  Both 
appraisals controvert that determination.  Polaris’s appraisal expert determined a 
land value of $7,200,000, but perhaps more important, the BOE’s own appraisal 
expert had fixed the value of the land at $8,600,000. 
{¶ 17} Although the BTA’s finding of total value was supported by the 
BOE’s appraisal, its allocation of value to land was not.  The allocation of value 
between land and improvements does not constitute an arbitrary exercise; it 
relates to the basic method by which county auditors determine value.  The Tax 
Commissioner’s administrative rules direct the county auditors to arrive at total 
value by separately valuing the land and improvements.  See Ohio Adm.Code  
5703-25-07(B).  The commissioner also prescribes two different rules for land 
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valuation and the valuation of improvements.  Ohio Adm.Code 5703-25-07(C), 
5703-25-11, and 5703-25-12. 
{¶ 18} When we review BTA decisions, we determine whether the 
decision is “reasonable and lawful.”  Shiloh Automotive, Inc. v. Levin, 117 Ohio 
St.3d 4, 2008-Ohio-68, 881 N.E.2d 227, ¶ 15.  Under this standard, we will affirm 
the BTA’s determinations of fact if the record contains reliable and probative 
evidence to support the BTA’s findings.  Id.  But we will reverse if the record 
does not support, or if it contradicts, the BTA’s findings.  Dayton, 113 Ohio St.3d 
281, 2007-Ohio-1948, 865 N.E.2d 22, ¶ 14, 27-28.  Because the record in this 
case contains no support for, and indeed contradicts, the BTA’s finding of land 
value, we must reverse it.  As in Dayton, we remand for additional factual 
determination based upon the evidence in the record. 
{¶ 19} As we have already established, the BOE’s failure to file a cross-
appeal limits our jurisdiction on appeal.  By the same token, the absence of a 
cross-appeal limits the BTA’s jurisdiction on remand.  On remand, the BTA has 
jurisdiction to redetermine the value of the land.  In redetermining the land value, 
the BTA shall, among other things, address the parties’ dispute concerning the 
value of one parcel that Polaris alleges was not zoned for commercial use and that 
had been the subject of a recent sale.  However, the BTA on remand has no 
jurisdiction to disturb its previous determination of the value of the 
improvements. 
Decision reversed 
and cause remanded. 
 
MOYER, C.J., and LUNDBERG STRATTON, O’CONNOR, O’DONNELL, 
LANZINGER, and CUPP, JJ., concur. 
__________________ 
 
LUNDBERG STRATTON, J., concurring. 
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{¶ 20} While I concur in the majority opinion because the statute and our 
case law dictate that result, I write to alert all unsuspecting parties that a cross-
appeal will be necessary due to recent tax law changes in order to preserve the 
issue of the value of property as a whole.  R.C. 5717.04 requires that a party 
seeking to appeal a decision of the Board of Tax Appeals (“BTA”) to this court 
must “set forth * * * the * * * errors complained of” in the BTA’s decision.  
Ordinarily, this mandate is standard practice, but in this case, it leads to a 
decidedly odd consequence:  as the majority describes, the statute permits the 
property owner to appeal from the determination of the value of the land while 
leaving the BTA’s determination of the value of the improvements beyond the 
jurisdiction of the court.  That is true even though the BTA determined the value 
of the land in close conjunction with determining the value of the improvements. 
{¶ 21} In most situations, a party that perceives an error in a lower court’s 
decision but is not aggrieved by the outcome of that decision need not file a cross-
appeal in order to preserve the right to raise the claimed error.  Instead of 
appealing, that party raises the issue in the course of defending against the other 
party’s appeal.  But R.C. 5717.04 and the cases in which we have applied that 
statute do not permit that procedure here. 
{¶ 22} Although I agree with the majority’s disposition of this issue, I 
write separately to note that this situation is likely to recur and that litigants who 
have prevailed before the BTA need to consider carefully whether they ought to 
file a protective cross-appeal when an opponent appeals the BTA’s decision to 
this court.  In this case, the property owner contended that the improvements 
constituted personal property pursuant to this court’s decision in Funtime, Inc. v. 
Wilkins, 105 Ohio St.3d 74, 2004-Ohio-6890, 822 N.E.2d 781.  As a result, the 
improvements were not, under the owner’s theory, subject to the real property tax 
at all.  The BTA ruled against the owner’s position on that issue and then 
determined the value of the land and improvements based on the evidence 
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presented.  When the owner assigned error only as to the valuation of the land in 
its notice of appeal, and when neither the board of education nor the county 
auditor cross-appealed the value assigned to the improvements, the owner placed 
the land-value at issue while foreclosing a comprehensive valuation of the 
property.  Such a procedural situation does not serve the ultimate interest in 
arriving at a proper total value for the property. 
{¶ 23} The situation presented here is likely to recur because in 2005, the 
General Assembly enacted tax reform measures that phased out the ad valorem 
tax that Ohio had traditionally levied on personal property used in business.  It is 
now obvious that owners will seek, where possible, to characterize property as 
personal property rather than as realty in order to avoid taxation of that property.  
Litigants in such cases need to be alerted to the need to file protective cross-
appeals whenever the preservation of the result they desire calls for the correction 
of a BTA error.  Doing so will ensure that property is properly valued, a result 
that serves all taxpayers. 
{¶ 24} I concur. 
__________________ 
 
Sleggs, Danziger & Gill Co., L.P.A., and Todd W. Sleggs, for appellant. 
 
Rich, Crites & Dittmer, L.L.C., Jeffrey A. Rich, and Mark H. Gillis, for 
appellee Board of Education of Olentangy Local Schools. 
 
David Yost, Delaware County Prosecuting Attorney, and Christopher 
Betts, Assistant Prosecuting Attorney, for appellees Delaware County Board of 
Revision and County Auditor.