Opinion ID: 1730025
Heading Depth: 1
Heading Rank: 14

Heading: Costing Methodology

Text: DRI argues that the Board's 2004 valuations were arbitrary and unreasonable because the assessor did not follow regulations and manuals promulgated by the Property Tax Administrator, and specifically those published by Marshall & Swift, LP, such as the Residential Cost Handbook and Marshall Valuation Service. The assessor testified that the TerraScan program which she utilized in determining the 2004 valuations utilized costing information published by Marshall & Swift, and the record cards generated by TerraScan include a notation that data used for calculations is supplied by Marshall & Swift. The reports make reference to a Manual Date, and the record cards reference Marshall Swift tables dated June 2001. The assessor testified that she did not know if Marshall & Swift published new costing tables in June 2001 and that she did not manually compare the TerraScan information on the DRI properties to the Marshall & Swift tables, but, rather, relied upon the program to use the correct information. Newell testified as to her understanding that Marshall & Swift compiles data and issues updates on a regular basis. She stated that quarterly multipliers should then be used to trim the costs published on the pages that you already have in your Handbook to a current date to adjust the costs. The following exchange then occurred: [DRI's counsel:] Now, specifically were there sheets distributed forit comes out in a book for June 1st of 2001 for averagelow quality, fair quality, average quality, good quality, that would cover thea change made for June, 2001? [Newell:] For residential there were not. Q That's A For residential [TERC chairman]: Is that for the cost factors ... or is that [Newell]: It [TERC chairman]: I'm sorry. I can't tell whether counsel is asking you the definitions of change or did the cost factors change. [Newell]: I believe the question was, did you receive a new page, printout, data. [TERC chairman]: Cost factors? [Newell]: On June of 2001 for the residential section. [TERC chairman]: All right. [Newell]: That's why I said, no, not for the residential. [TERC chairman]: But it's a cost factor. It's not the descriptor. It's not the definitions. [Newell]: Yes, cost. [TERC chairman]: And it wasn't a factor that you would apply to a prior value. [Newell]: Wasn't the multipliers. [TERC chairman]: Wasn't the multiplier, all right. [DRI's counsel]: Thank you. The record lists a Marshall & Swift Valuation Service Manual dated 6/2001 as one of the documents which TERC could consider and utilize without inclusion in the record pursuant to § 77-5016(3), although it does not appear that TERC made specific reference to this manual in this case. DRI argues, on the basis of this evidence, that the TerraScan program utilized incorrect Marshall & Swift costing information in arriving at the 2004 valuations. We cannot determine from the rather confusing record whether or not this is so. Moreover, DRI offered no evidence as to which Marshall & Swift manual should have been used, or whether the use of a different manual would have resulted in lower valuations. While we acknowledge that this evidence raises some questions regarding the costing methodology employed by the assessor, we cannot conclude on the basis of this evidence alone that the valuations derived from the TerraScan program utilizing Marshall & Swift costing information were arbitrary or unreasonable. DRI also argues that an audit of the Banner County assessor's office conducted by the Department of Property Assessment and Taxation for the period of October 2001 through January 2002 is probative of deficiencies in the 2004 valuations at issue here. We are not persuaded by this argument and agree with the conclusion of TERC that on this record, it cannot be determined that discontinued assessment practices for years prior to 2003 affected valuation of the subject property for the tax year 2004. [20]