Court Opinion

ID: 9730751
Source: CourtListenerOpinion
Date Created: 2023-08-26 15:22:42.813563+00
Date Added: 2024-06-11T18:26:09.044262
License: Public Domain

Ryan, J.
We address a conflict which has a long and protracted history arising out of Saginaw Township’s 1971 tax assessment of appellee’s property. The original dispute between the parties was initially resolved by this Court in 1974 in a unanimous opinion written by Justice Fitzgerald. CAF Investment Co v State Tax Comm, 392 Mich 442; 221 NW2d 588 (1974). The Court reversed the decision of the tax commission and remanded to the Tax Tribunal1 for proceedings consistent with the opinion.
The Tax Tribunal thereafter conducted two weeks of hearings culminating in a lengthy opinion dated April 5, 1976. On appeal as of right to the Court of Appeals, the Tax Tribunal was again reversed and the case was remanded for redetermination. The Court of Appeals concluded that the tribunal failed to follow the dictates of this Court’s earlier decision. CAF Investment Co v Saginaw Twp, 79 Mich App 559; 262 NW2d 863 (1977).
We have again granted leave to appeal. 403 Mich 801 (1978).
I
The facts giving rise to this dispute are exten*447sively stated in our prior decision and need not be repeated at length here.
It suffices to say that C.A.F. disagrees with Saginaw Township’s assessed valuation of commercial property owned by the company. The property is encumbered by a long-term lease with the S.S. Kresge Company for a K-Mart store. The lease is not expected to expire, until 1998 if available options are exercised. Under the economic conditions for the assessment years now in dispute, 1971-1975, actual income under the lease is relatively low. Expert witnesses for both parties conceded, however, that the lease fairly reflects 1963 economic conditions, the year the lease was made.
When this case was here before, C.A.F. was challenging Saginaw Township’s true cash valuation of $1,442,364 for the subject property.2 That *448determination had been appealed to the State Tax Commission which essentially sustained the township’s earlier assessment. In making that decision, the tax commission relied heavily upon the testimony of Norman Daniels, a staff appraiser. Daniels had submitted a true cash valuation of $1,600,-000 based upon both the capitálization of income and the depreciated reproduction cost methods of appraisal. The basis for Daniels’ calculation of capitalized income value was a projection of the expected 1971 rental return for comparable property. Reduced to its simplest terms, this represented an "economic rental” value, of $2.00 per square foot based upon the operations of similar K-Mart properties.3 Implicit in the valuation was that the property was then available to rent in the marketplace, which of course was not the case.
On appeal to this Court, C.A.F. contended that "true cash value”, as defined by statute, could only be determined by reference to the actual income realized under the terms of the lease with S.S. Kresge. Basing his calculations of capitalized income value on actual income, the C.A.F. appraiser, Dean Nelson, arrived at a valuation of $787,500. C.A.F. contended that this figure accurately reflected true cash value. The tax commission’s reliance upon an "economic rental” or "hypothetical income” as a basis for appraisal, C.A.F. argued, had no reasonable relationship to the usual selling price or fair market value of the property which is the constitutional and statutory standard for determining true cash value.
The tax commission defended its valuation by pointing out that C.A.F.’s actual rental figures under the lease resulted in an unreasonably low *449capitalized valuation. The tax commission equated the statutory language "economic income” with the appraisal term "economic rental”. Thus, the tax commission contended that if property is leased under a long-term lease for a rental which in later years proves unduly low in the face of economic changes, actual rent could be ignored and the potential rental income of the property on the open market could be utilized.
Justice Fitzgerald incisively framed the issue presented to this Court as follows:
"[W]hether, under Michigan law, the tax commission was entitled to consider and give weight to evidence of valuation based upon a rate of return which comparable, unencumbered property could earn in the present marketplace in the face of an existing unfavorable long-term lease with an actual rate of return which is substantially less than the present 'going rate’.” 392 Mich 442, 447.
This Court held that under the circumstances of the case presented, the answer was, "No”. It was held that, as used in the statute, "economic income” meant "actual income”. Id., 454. To the extent that the capitalization of income method is used for determining true cash value, the assessor was obligated to use the actual income under the existing long-term lease as the basis for his calculations. Id. The record indicated that the lease was the product of an arm’s-length transaction and fairly reflected economic conditions at the outset. To the extent that the tax commission permitted actual income to be ignored, the township’s valuation was clearly in error. A hypothetical rental income based on comparable properties leased at more favorable rates was an improper basis for determining true cash value. Id., 455.
*450This Court reversed the tax commission and remanded for a determination of true cash value based upon actual income. Due to a procedural error also committed by the tax commission, a full de novo hearing was held by the Tax Tribunal.
Not surprisingly, evidence developed at the hearing on remand essentially mirrored that taken at the original hearing. The C.A.F. appraiser, Dean Nelson, testified on behalf of C.A.F. and again arrived at a 1971 assessed valuation of $787,500 by capitalizing actual income under the existing long-term lease. Nelson expanded his appraisal to cover the intervening years to 1975. The highest valuation under his calculations was $950,-500 for the assessment year 1974. These figures, according to Nelson, represented the fair market value of the property to a commercial investor. Nelson opined that investors would look at the cash flow under the existing lease to determine the fair market value of the property.
Norman Daniels again testified on behalf of the township. His testimony and appraisal were corroborated by a fellow tax commission appraiser, Russell Galvin. Both testified that the most reliable method of determining the fair market value of the property was by the capitalization of income method. Two alternative methods of valuation were utilized to check the validity of the capitalization of income method.4 Both witnesses determined that the valuations for the assessment years in question were as follows: $1,509,000 in 1971; *451$1,570,000 in 1972; $1,640,000 in 1973; $1,705,000 in 1974; and $1,771,000 in 1975.
Daniels and Galvin testified that these figures reflected the true cash value of the entire property and not just the value of the lessor’s interest under the lease as reflected by use of actual rental income alone as suggested by the C.A.F. appraiser. On cross-examination both experts explained that, in essence, this meant that they looked to the hypothetical rental income of the subject property to make their calculations and ignored actual rent received under the lease. They even went so far as to say that to determine the total value of the subject property, actual rent received was irrelevant. Daniels admitted that with the exception of a change in the vacancy factor, there was no difference between the first appraisal submitted originally to the tax commission and the second appraisal provided to the Tax Tribunal at this hearing.
After taking the above testimony the Tax Tribunal made supplemental findings of fact, none of which are pertinent to the resolution of the present appeal,5 The Tax Tribunal then framed the *452legal issue which it deemed necessary for it to resolve in the dispute presented: "Where real property is subject to a long-term lease which currently provides less than the normal market rent, is such property to be assessed on a value predicated on the actual level of income?”
After a lengthy statutory analysis, the Tax Tribunal essentially reaffirmed the tax commission’s earlier assessment of the C.A.F. property. With modification to the capitalization rates and expense figures, the Tax Tribunal predicated the value of the property on the capitalization of income method of appraisal as employed by the tax commission appraiser, Norman Daniels. Market rent in lieu of actual income was utilized to *453reach a valuation of $1,389,452 for the assessment years 1971-1974. The 1975 assessment year valuation was determined to be $1,473,506.
Emphasized throughout the opinion was the Tax Tribunal’s belief that the Legislature did not intend the use of actual income to determine true cash value when that figure represented only a portion of the commercial income potential of the property involved. The appraisal submitted by C.A.F. appraiser Dean Nelson, consisting of a capitalization of actual income under the long-term lease, was considered to be "of little, if any, evidentiary value”. The foremost reason for its rejection was the appraisal’s failure to predicate valuation on "the amount of income the subject property is capable of producing”.
The Court of Appeals reversed the decision of the Tax Tribunal and again remanded. The Court reasoned that our prior decision required that capitalization of actual income form the basis of the tribunal’s calculations and held that by ignoring actual income and adopting the appraisal based upon the rate of return of comparable unencumbered property, the Tax Tribunal committed a clear error of law. CAF Investment Co v Saginaw Twp, 79 Mich App 559, 546-565; 262 NW2d 863 (1977).
On appeal, Saginaw Township contends that the Court of Appeals misconstrued our earlier decision; that our decision did not require the valuation of C.A.F.’s property to be based solely on actual rent; that actual rent need only be considered along with other relevant factors; and that if in light of unusual circumstances actual income did not reflect the true cash value of the entire property, actual income could be properly disregarded. The township also argues that to predicate *454valuation on the actual income received under a long-term lease allows a taxpayer to effectively "freeze” his real estate tax assessment against future inflation of land values which violates the constitutional requirement of uniformity of assessment.
C.A.F. responds that the Court of Appeals applied the law of the case to the Tax Tribunal decision and correctly found it to be inconsistent; that the only appraisal which conformed with the principles of true cash value mandated by our prior decision was Dean Nelson’s; and that the Tax Tribunal’s partial reliance upon an appraisal based on hypothetical income was in clear conflict with our prior decision. /
II
The law of the case doctrine dispenses with the need for this Court to again consider legal questions determined by our prior decision and necessary to it. As generally stated, the doctrine is that if an appellate court has passed on a legal question and remanded the case for further proceedings, the legal questions thus determined by the appellate court will not be differently determined on a subsequent appeal in the same case where the facts remain materially the same. Corporation & Securities Comm v American Motors Corp, 379 Mich 531; 152 NW2d 666 (1967); Palazzolo v Sackett, 254 Mich 289; 236 NW 786 (1931); American Ins Co of Newark v Martinek, 216 Mich 421; 185 NW 683 (1921); Allen v Michigan Bell Telephone Co, 61 Mich App 62; 232 NW2d 302 (1975); Topps-Toeller, Inc v Lansing, 47 Mich App 720; 209 NW2d 843 (1973).
The application of this principle was recognized early in the judicial history of this state. In Pierce *455v Underwood, 112 Mich 186-187; 70 NW 419 (1897), Justice Montgomery stated:
"This case was before the court at a former term, and is reported in 103 Mich 62 [61 NW 344], to which reference is made for a statement of the facts. The case has been retried at the circuit, and has resulted in a verdict and judgment in favor of the plaintiff. The brief of the appellant raises the same questions which were discussed in the former case and reargues them. We cannot review the questions which were there disposed of. If it is claimed that the conclusions of law reached on the former hearing were erroneous, the remedy is by a motion for a rehearing, but a ruling of this court in a case becomes the law of the case to govern a new trial, and is not subject to review thereafter.”
The controlling facts in the instant dispute remain virtually identical with those which obtained when we decided this dispute the first time, other than the extension of the valuations through 1975. The appraisals submitted by the parties at the hearing on remand, in essence, utilized the same methods of valuation and arrived at virtually the same determinations of true cash value as before. The issues framed by the township on this appeal are nothing more than polemic restatements of the question decided on prior appeal.
Determinative in the present appeal is the Tax Tribunal’s reliance on the appraisal of Norman Daniels which substituted the economic rental or hypothetical income for the actual rent of the subject property under the long-term lease, despite this Court’s prior rejection of that criterion as a proper basis of valuation. The cross-examination of Daniels at the hearing on remand was, in part, as follows:
"Q. Well, but isn’t it true, Mr. Daniels, that in *456arriving at total value in this case, the actual rent received from K-Mart was irrelevant?
"A. What’s that again?
”Q. In arriving at total value, wasn’t the actual rent received by C.A.F. from K-Mart irrelevant?
"A. In valuing the total property value, yes.
"Q. Yes, it was irrelevant?
"A. Yes.
”Q. So if you had not considered any actual rent at all, you would have come out exactly the same in your total value?
"A. In valuing the fee simple estate, yes.”
The Tax Tribunal’s acceptance of Daniels’ appraisal based on the use of hypothetical income is evidenced by its adoption of the $2.00 per square foot rental income figure used by Daniels as opposed to the $1.30 per square foot actual rental figure. The error in basing valuation upon the rental value of comparable property was clearly stated by Justice Fitzgerald in our prior decision:
"The State Tax Commission’s ultimate determination of true cash value of $1,440,000 is based in part upon the testimony of Norman Daniels on 'economic income’ capitalization. To the extent it is based upon such evidence, the ultimate valuation relies upon a hypothetical rental income without consideration of actual rental income demonstrably related to fair market value. Such a valuation does not comport with the constitutional and statutory standard of 'true cash value’.” 392 Mich at 454-455.
Remarkably, the Tax Tribunal is guilty of the same error for which we reversed the tax commission previously. It was presumptuous for the Tax Tribunal to embark upon a legal analysis of a question that was clearly presented to and decided by this Court on prior appeal. The Tax Tribunal’s *457division of the C.A.F. property into "leased fee” and "leasehold” interests for purposes of establishing the true cash value of the "entire” property is an inappropriate subterfuge to justify the tribunal’s determination to reject the use of actual income when it falls below the potential rental value of comparable properties currently on the market, and is unwarranted. The tax commission was reversed by this Court in our prior decision for its use of hypothetical income rather than actual income to reach a projected income figure. In its decision on remand, the tribunal has attempted to justify essentially the same method of valuation. In fact, the Tax Tribunal used the same "economic rental” figure of $2.00 per square foot supplied by Norman Daniels that the tax commission had employed in its calculations. We hold once again that such a method of valuation is erroneous.
The Tax Tribunal’s reasoning upon remand, and the township’s argument on appeal, is that our prior decision required only that actual income be "considered” in determining true cash value and that once it had given "consideration” to actual income and determined that it did not accurately reflect current rates of return of comparable property on the open market, actual income could be ignored.
The Tax Tribunal’s estimation of the significance this Court placed on actual income in this dispute falls woefully short of the mark.6 All the *458appraisers testified that the capitalization of income method was the best indication of value. Commercial investors rely heavily upon cash flow represented by the capitalization of actual income to judge the fair market value of property. Having chosen that method of valuation, consideration of "economic income” as provided by statute was imperative. Our prior decision left no doubt that "economic income” meant nothing other than actual income under the circumstances of this case. CAF Investment Co v State Tax Comm, supra, 454. We said as much: "[I]n this case the record indicates that long-term lease rental fairly reflects economic circumstances at the outset of the lease term and bears a demonstrable relation to true cash value”. Id., 456, fn 6. Other than the fact that actual income was less than the rate of return comparable property might receive under current market conditions, there was no suggestion that the lease was arrived at other than by arm’s-length negotiations.
A
A calculation under the capitalization-of-income method yields a projected income figure. Often, as here, that figure alone will reflect the fair market value of the property. Saginaw Township and the Tax Tribunal have maintained throughout the *459course of these proceedings, however, that projected income, as reflected by the capitalization of actual income received under the long-term lease, does not reflect the true cash value of the entire property. Instead, they argue, any projected income figure calculated on the basis.of actual income values only the lessor’s (C.A.F) interest in the property and ignores the lessee’s (K-Mart) interest under the lease, and that the lessee has a measurable interest in the land due to the economic advantage it enjoys by renting property for an amount that is less than the prevailing rate in the current market.
Whatever merit that proposition might have in the science of real estate appraisal, consideration of a so-called lessee’s interest by the means employed by the Tax Tribunal is foreclosed by our prior decision. Testimony of the tax commission experts was that in order to value the entire property, consisting of both the lessor’s and lessee’s interest, anytime actual income fell below the market rent or hypothetical income of comparable property actual income would be ignored, and it was ignored in this case for that very reason.
The fault of this methodology is that true cash value must equal the fair market value of the property to the owner. All experts conceded that economic income most accurately reflected that value. And, on the facts before us, economic income was nothing other than actual income, since it had been determined that for the years in question the lease rental reflected current economic circumstances and bore a demonstrable relation to true cash value. Moreover, to equate economic income with hypothetical income in every situation where actual rent under a long-term lease is less than the prevailing market rental *460would be to ignore the effect of the lease on a prospective investor’s judgment regarding the fair market value of the property. That was the very situation confronting this Court on prior appeal. We refused to allow the consideration of actual income to be diluted by reference to the potential income of comparable property then, and we do so now.7
B
In other cases there may well be other circumstances or considerations that necessarily require adjustment to the projected actual income figure to arrive at an accurate true cash valuation. These were mentioned in our prior decision and apparently were a source of the tribunal’s confusion on remand. Justice Fitzgerald stated in 392 Mich at 455-456:
"By the holding in this case, we do not mean to suggest that the tax assessor, in utilizing the income capitalization approach to valuation, is limited to, and must accept, the actual rental figure under an existing long-term lease as the sole measure of projected income and basis for capitalization. In most cases such an approach to true cash value would lead to distorted valuation. Such factors as the right to repossession of the land at the end of the lease, and the length of the lease term often suggest that the projected income figure should at least in part be adjusted to reflect current market conditions. It may also be appropriate to adjust the projected income figure in circumstances where financing was obtained at a much more favorable rate than the current going rate, and there is a high *461current rate of capitalization, in order to reflect the fact that the income-earning capacity of the property is greater than consideration of the unfavorable long-term lease rental at current capitalization rates would alone suggest. Furthermore, we can envision circumstances in which it may be inappropriate to consider lease term rental as a component of projected income. Finally, there may be such facts, peculiar to the circumstances under consideration, as would indicate that the income capitalization approach is too speculative to be a reliable indicator of valuation. In such circumstances the tax assessor may base his assessment upon a more reliable method of valuation.” (Footnotes omitted; emphasis added.)
Emphasized are certain "adjustments” to project income. The factors mentioned are by no means exhaustive. They were mentioned to illustrate that a projected income figure arrived at by virtue of a capitalization of actual income may not reflect a truly accurate picture of a property’s fair market value. See Port Sheldon Twp v Ottawa County, 80 Mich App 91; 263 NW2d 299 (1977); Ramblewood Associates v City of Wyoming, 82 Mich App 342; 266 NW2d 817 (1978); Wolverine Tower Associates v Ann Arbor, 96 Mich App 780; 293 NW2d 669 (1980). They were not mentioned as reasons to ignore the use of actual income in calculating projected income in the instant case.
The right to repossession and the length of the lease in the instant case were accorded value in the Tax Tribunal’s calculations by adjusting the rate of capitalization.
C
The precise error in the tribunal’s calculation of true cash value having been indicated, and the Tax Tribunal having made detailed findings of fact *462on the expense and capitalization figures to be utilized, the actual per square foot rental value need now only be "plugged into” the formula to arrive at projected income.8
Ill
Saginaw Township contends that to predicate value of a given property upon the taxpayer’s rate of return under an economically unfavorable lease, *463while on the other hand valuating unencumbered property at current market level, is violative of the constitutional requirements of uniformity of assessment and due process.9
The Tax Tribunal expressed much the same concern. In the Tax Tribunal’s opinion not only must a valuation method reflect the value of propérty on the investment market, but it must also produce uniformity of assessment. Because a determination of projected income based on actual rental would depend upon the rental provided in the long-term lease, the Tax Tribunal felt uniformity of assessment could never be achieved unless market rent was utilized in every calculation.
We are not unmindful of the primacy of uniformity and equality in assessment. See Allied Supermarkets, Inc v Detroit, 391 Mich 460; 216 NW2d 755 (1974); In re Appeal of General Motors Corp, 376 Mich 373; 137 NW2d 161 (1965). The township’s argument, however, begs the question. The touchstone of uniform assessment is the true cash value or usual selling price of the property. Assessment decisions must recognize limitations or restrictions which have a bearing on the selling price of property. Brae Burn, Inc v Bloomfield Hills, 350 Mich 425; 86 NW2d 166 (1957).
The township’s appraiser testified that the property in the instant case would be bought and sold based upon the actual contract rent received under the long-term lease. We find that with certain adjustments this represented the true cash value *464of the property. Uniformity is achieved by assessing all property with the same true cash value at a consistent level.
We find C.A.F.’s answer to the Tax Tribunal’s concern for uniformity of assessment persuasive. Properties may have similar physical characteristics, but differences in economic factors will determine the usual selling price of the properties. Properties encumbered by different lease terms, zoning restrictions, or deed restrictions, although physically similar, would not have the same cash value on the open market. See Kensington Hills Development Co v Milford Twp, 10 Mich App 368; 159 NW2d 330 (1968); Lochmoor Club v Grosse Pointe Woods, 10 Mich App 394; 159 NW2d 756 (1968). It would be incongruous, indeed violative of the rule of uniformity, to assess two properties the same despite the fact that their usual selling prices are different.
We find no uniformity or due process violations in an assessment premised on true cash value as defined by this Court.
IV
We conclude that in failing to use actual income as the basis of its capitalization of income, the Tax Tribunal disregarded the mandate of CAF Investment Co v State Tax Comm, 392 Mich 442; 221 NW2d 588 (1974), and thereby committed error.
We direct the Tax Tribunal to enter a specific order forthwith and bring an end to this excessively protracted litigation.
Using the taxpayer’s actual income and expenses (which were accepted by the Tax Tribunal as accurate), and vacancy factor, and the rate of *465return and tax rate adopted by the Tax Tribunal, the values for 1971 and 1975 are as follows:
1971 1975
$1.31/sf $1.63/sf
Gross income 141,000 174.554
Vacancy and credit loss -2,820 (2%) -0-
Effective gross income 138,180 174.554
Expenses -33,866 -41,064
Net Income 104,314 133,490
Overall rate 10.00% 10.50%
Tax rate 2.23% 2.25%
12.23% 12.75%
Value Estimate:
197X_ 104,314. $852,935.40
1993
1975_ 133,490. $1,046,980.30
.1275
The 1971 value was applied to the years 1972, 1973, and 1974 as well.10 Thus, capitalization of actual income yields the following figures:
Tax Year Cash Value Assessment Level Assessment
1971 $ 852,935.40 17.04% $145,340.19
1972 852.935.40 50.00% 426.467.70
1973 852.935.40 48.44% 413,161.90
1974 852.935.40 50.00% 426.467.70
1975 1,046,980.30 50.00% 523,490.15
It is hereby ordered that the Tax Tribunal enter a final order in accordance with the foregoing figures. Interest on any refund shall be calculated as prescribed by MCL 205.737(4); MSA 7.650(37)(4).
*466No costs, a public question being involved.
Coleman, C.J., and Kavanagh and Levin, JJ., concurred with Ryan, J.

 During the course of the appeal, the Legislature enacted the Tax Tribunal Act which transferred jurisdiction over property tax appeals from the tax commission to the Tax Tribunal. MCL 205.701 et seq.; MSA 7.650(1) et seq.

 "True cash value” is the basis for the uniform general ad valorem taxation of real property. Const 1963, art 9, § 3. The Legislature, during the period in question, defined "true cash value” in MCL 211.27; MSA 7.27, to mean, in essence, the "usual selling price” of such property on the open market, taking into account various other factors, including the "present economic income of structures”.
MCL 211.27; MSA 7.27 provided in pertinent part:
" 'Cash value’ means the usual selling price at the place where the property to which the term is applied shall be at the time of assessment, being the price which could be obtained for the property at private sale, and not at forced or auction sale. Any sale or other disposition by the state or any agency or political subdivision of lands acquired for delinquent taxes or any appraisal made in connection therewith shall not be considered as controlling evidence of true cash value for assessment purposes. In determining the value the assessor shall also consider the advantages and disadvantages of location, quality of soil, zoning, existing use, present economic income of structures, including farm structures and present economic income of land when the land is being farmed or otherwise put to income producing use, quantity and value of standing timber, water power and privileges, mines, minerals, quarries, or other valuable deposits known to be available therein and their value.
"Except as hereinafter provided, property shall be assessed at 50% of its true cash value in accordance with article 9, section 3 of the constitution.” 1973 PA 109.
This section has since been amended by 1976 PA 293, § 1; 1976 PA 411, § 1; and 1978 PA 25, § 1.

 The terms "economic rental”, "hypothetical rental income”, "potential income/rent”, and "rate of return on comparable property” are used interchangeably throughout this opinion.

 It should be noted that our prior decision left open the prospect of utilizing other appraisal methods to determine true cash value in the appropriate circumstances. See 392 Mich at 450, fn 2. It was the unanimous opinion of the appraisers in the instant case that the capitalization of income method reflected the most accurate and reasonable assessment of fair market valuation and it is that method, therefore, which is the proper basis for the tribunal’s assessment.

 The Tax Tribunal developed the following additional facts and circumstances at the hearing on remand:
"1. At the time of the initial assessment in 1971, that triggered this appeal, petitioner refused to provide the appraisal firm that reappraised all the property in the assessment district with the income and expense data on which this appeal is based.
"2. During this hearing petitioner, represented by counsel only at the hearing, objected to the introduction of the mortgage and to petitioner’s balance sheet for December 31, 1966, which were both introduced by respondent as its Exhibits No. 11 and 13, respectively, which were admitted as evidence.
"3. The balance sheet (respondent’s Exhibit 13) indicated the total cost of subject property was $1,057,318.88, while the mortgage (respondent’s Exhibit 11) indicated petitioner was loaned $1,250,000 on subject property on November 15, 1963, or for a mortgage loan of $192,681 in excess of cost. Petitioner offered no explanation for this excess.
"4. That there are only three or four developers in the country who *452have been able to develop 'K-Mart’ properties. There was no adequate explanation offered as to why this was so.
"5. That S.S. Kresge Company is a very desirable 'Triple AAA’ [sic] tenant from an economical standpoint.
"6. That petitioner’s appraiser, in making his appraisal predicated on lease rental income only, did so on instructions of petitioner.
"7. One of respondent’s witnesses, a Level IV certification appraiser for the State Tax Commission, spent eight weeks preparing the appraisal on this property utilizing a market rent income valuation approach.
"8. That assessors cannot compel taxpayers to furnish income and expense data for use in appraising on an income valuation method.
"9. That assessors can only obtain such data from those that are willing to give it.
"10. That both petitioner’s and respondent’s appraisers made appraisals for the tax years 1971 and 1975, respectively, and at the request of the tribunal prepared and testified to estimates of value for the intervening 1972, 1973 and 1974 tax years.
"11. That petitioner’s appraiser had not prepared an appraisal based on the 'cost’ or 'market’ approach on the grounds that the income method was the best method and that in utilizing the lease rental income in lieu of market rent in 1975 he was acting on instructions of his client, the petitioner.
"12. Respondent’s other expert witness appraiser prepared a 'cost’ and 'market’ approach appraisal for 1971 but, together with respondent’s first expert witness who prepared the 'income’ method appraisal, agreed that the 'income’ method was the best method to be used with the subject property provided that the value could not be predicated on the lease rental income alone when such income is substandard compared to market rent and that in this case 'market rent’ was used by them in valuing the property.”

 It is contended by the township and Justices Fitzgerald and Moody that when we directed the Tax Tribunal to "consider” actual income in our previous opinion, 392 Mich 456, fn 6, we required only that the tribunal think about using actual income as the basis of its calculation, with the option to disregard it if it so chose. The contention is untenable. To construe "consider” in that manner is manifestly illogical since the Tax Tribunal (then the tax commission) had received into evidence at the first hearing, the one reviewed in our *458previous opinion, the testimony of Dean Nelson, the C.A.F. appraiser, who maintained that the true cash value of the property in question must be determined with reference to actual income. Patently, when we ordered the Tax Tribunal to "consider” actual income it had already thought about, and rejected, its use. Indeed, we quoted the tribunal’s recognition that its valuation of the property "was arrived at after 'consideration of all the information contained [in the noted facts]’ ”. 392 Mich 447 (quoting the Tax Tribunal) (emphasis added; brackets in original). Against this backdrop it is plain that the tribunal had considered actual income when we ordered it to "consider” the same. In this context, the only reasonable interpretation of "consider” is "use”.

 It should be noted that the appraiser for C.A.F. did adjust the capitalization rate to reflect the owner’s reversionary interest under the lease. The Tax Tribunal presumably acknowledged the validity of providing for the valuation of that interest by such an adjustment by further modifying the capitalization rate before employing it in their calculations of projected income.

 See Part IV, post.
The Tax Tribunal set forth its calculations as follows:
1971
Gross Income $214,522 (at $2/sq. ft.)
Vacancy & Credit Loss -10,726 (5%)
Effective Gross Income 203,796
Expenses -33,866
Net Income $169,330
Overall Rate 10.00 %
Tax Rate 2.23
Capitalization Rate 12.23 %
Value estimate by income approach:
$169,930 _ $1,389,452
.1223
1975
Gross Income $241,339 (at $2.25/sq. ft.)
Vacancy & Credit Loss -12,067 (5%)
Effective Gross Income 229,272
Expenses -41,400
Net Income $187,872
Overall Rate 10.50 %
Tax Rate 2.25
Capitalization Rate 12.75 %
Value estimate by income approach:
$187’872 = $1,473,506
.1275
The Tax Tribunal made findings of fact that the actual rental income per square foot under the long-term lease was $1.30 and $1.60 for the years 1971 and 1975, respectively.

 Const 1963, art 9, § 3, provides, in part, as follows:
“The legislature shall provide for the determination of true cash value of such property; the proportion of true cash value at which such property shall be uniformly assessed * *
Pursuant to this constitutional grant of authority, the Legislature enacted MCL 211.27; MSA 7.27, which has been set forth and discussed at length above.

 As to the years 1972, 1973 and 1974, the Tax Tribunal explained that the parties had submitted "estimates of value” for those years but characterized "these opinions” as "unsubstantiated estimates” and stated its conclusion that it should "restrict their use solely to determining that no unusual fluctuation of true cash value occurred in the intervening tax years”. The Tax Tribunal concluded that "[t]here [was] no evidence that such a fluctuation occurred”.