Opinion ID: 1188758
Heading Depth: 1
Heading Rank: 2

Heading: The Tax Court trial and ruling

Text: This case involves the valuation of the railroad operating properties covering years 1976 and 1977. By appropriate orders, the Department of Revenue had determined the market value of the plaintiffs' properties as follows: 1976 $42,085,201 1977 40,570,036 The plaintiffs filed complaints in the Tax Court alleging that the market value of the assessed properties was substantially less than the assessment of the Department of Revenue. Separate complaints were filed for each tax year, and the cases were consolidated for trial. At the commencement of trial, defendant said that it was abandoning its initial appraisal and would be seeking an increase in assessed valuation. After a lengthy trial before the Tax Court, the Tax Court issued its decision on February 14, 1979. [1] In its opinion, the Tax Court made no determination as to value, but indicated that of the three possible approaches to valuation of a railroad operating unit (Cost, Stock and Debt, and Income), [t]he parties and the court agree that the income approach is the most useful of the three approaches in light of the facts developed by the testimony. 8 OTR at 59. The Tax Court also stated general agreement with the defendant's method of computation of the income to be considered, 8 OTR at 59, while disagreeing with defendant's computations in several specific respects. Therefore, the Tax Court, pursuant to its TC Rule 26, [2] withheld the entry of its decree pending a recomputation by defendant in each of seven areas, following which the case would proceed, pursuant to TC Rule 26. 8 OTR at 75-76. After the defendant submitted its recomputations, a further hearing was held, following which the Tax Court ordered: IT IS FURTHER ORDERED that defendant recompute its proposed computations filed in this court on March 21, 1979, by determining the January 1, 1976, and 1977 allocated Oregon values, based solely upon defendant's income approach to value (continuing to comply with the requirements numbered 1, 4, and 7, found on pages 83-85 [8 OTR at 76] of the court's decision of February 14, 1979), together with the distribution of such values in Oregon of the three plaintiffs in this suit, and thereupon to prepare a form of decree to be submitted to the court pursuant to the court's Rule 27. The defendant filed revised Income approach calculations. Thereafter, the court entered a decree finding the true cash value of the plaintiffs' Oregon properties to be consistent with the defendant's final submission.