There’s a saying: “April showers bring May flowers.” Like the rain, property taxes provide an important foundation for funding local governmental services. To ensure the effectiveness of this process, fair and equitable taxation is essential. An avenue to contest assessments is crucial for fairness and equity. In Wisconsin, local boards of review (hereinafter BORs) provide that opportunity for property owners.
In municipalities across the state, local citizens and municipal officials prepare to serve on BORs. While members of BORs do not have capes or superpowers, these local heroes do provide a vital service in maintaining fair and equitable property taxes in Wisconsin and provide a good example of community involvement.
Overview of BORs
The property owner’s right to appeal a property tax assessment is part of the constitutional right to due process.1 Article I, section 9 of the Wisconsin Constitution declares that “every person is entitled to a certain remedy in the laws. They ought to obtain justice freely without being obliged to purchase it, promptly and without delay, conformably to the laws.” State law, Wis. Stat. section 70.47, provides this process for appeal by creating a local BOR to consider and decide property tax assessment appeals. The BOR is a quasi-judicial body responsible for correcting errors on the assessment roll and administering property tax assessment appeals.
The BOR is the first step in the formal appeal process for an individual property owner who protests an assessment. The property owner cannot pursue later avenues of appeal for an individual assessment unless a formal objection has first been made to the BOR. The BOR is responsible for adjusting any assessments proved incorrect as well as correcting any errors in the assessment roll. A BOR itself cannot value property but merely decides whether the assessor’s value is correct based on the facts presented to it.
The BOR has specific statutory duties, including the following:
correcting all description and computation errors in the assessment roll;
checking the roll for omitted property and for double assessments (omitted property must be placed on the roll and the owner notified); and
adjusting assessments when proven incorrect by sworn testimony.2
The BOR is responsible for evaluating evidence in the form of sworn testimony regarding the accuracy of an assessed value. The BOR may not substitute its judgment or opinion of value for the assessor’s. The BOR is legally bound to accept the assessor’s assessment as correct unless there is a sufficient showing of evidence that the valuation is incorrect.3
To hold a valid BOR proceeding, at least one voting member must attend a training session approved by the Wisconsin Department of Revenue (DOR) within two years after the board’s first meeting. While the law does not require it, the DOR encourages all BOR members to attend training each year to ensure proper procedure is followed with consistent and equitable results. A general timeline of events includes the following: 1) the assessment roll is open and available for public review (open book), 2) BOR’s first meeting (adjournment if necessary to complete the roll), 3) hearings, and 4) final adjournment.
New Requirements: Timing and Access
Recent statutory changes and case law impact BORs in two areas: timing and access.
Michelle Drea is an attorney who serves as the Wisconsin Property Assessment Manual and Guides editor for the Wisconsin Department of Revenue (DOR). She previously held positions with the city of Denver, Thomson Reuters, and a mid-sized company in Wisconsin. Her outside interests include running, writing, and spending time with her family.
Timing – New for 2018. Under revised Wis. Stat. section 70.47(1), the BOR must meet annually during the 45-day period starting the fourth Monday of April. The BOR cannot meet sooner than seven days after the last day on which the assessment roll is open for examination (open book).4 During open book, a property owner has the opportunity to discuss the assessment directly with the assessor and provide any information that might affect the assessment.
The minimum seven-day interim between open book and the BOR hearing is a change from prior law, which allowed open book and the BOR hearing to occur on the same day. However, this practice provided little time for a property owner to gather information for a BOR hearing if open book did not provide the desired outcome. The seven-day waiting period provides this opportunity for the property owner.
Property Owner Access to the BOR. Before 2017, property owners were required by statute to allow an assessor to conduct an interior inspection to appeal to the BOR. In a recent Wisconsin Supreme Court decision, Milewski v. Town of Dover,5 the court’s lead opinion concluded the following: 1) property owners had a due-process right to contest a tax assessor’s valuation of their real property as excessive; 2) a tax assessor entering a home to conduct an “interior view” for valuation purposes is entering private property for the purpose of obtaining information and is, therefore, conducting a Fourth Amendment search; and 3) the statutory procedure was unconstitutional because it required citizens to give up their Fourth Amendment right to be free from unreasonable government searches in their home in order to keep their Fifth Amendment due-process right to challenge their property tax assessment at the BOR.
The property owner cannot pursue later avenues of appeal for an individual assessment unless a formal objection has first been made to the BOR.
For circumstances in which available sources do not allow the assessor to develop a sound value for the property, the court highlighted the option of a special inspection warrant for gaining access to an interior view of the home.6 While the court did not discuss what specific facts would merit a warrant for interior view, factors to consider include, but are not limited to, whether information from a recent improvement inspection is available and the amount of information provided by the property owner.
The outcome of this case affects the BOR process. A property owner may now deny an assessor entry inside a residence and still appeal to the BOR. However, this does not preclude the assessor from seeking the special inspection warrant, if appropriate. Additionally, the property owner must still comply with all other requirements for appealing to the BOR under state law, such as submission of an objection form in writing and provision of other required materials.
A new statute7 does allow the BOR to deny a hearing to a property owner who does not allow the assessor to complete an exterior view of the home. However, the Wisconsin Supreme Court expressed due-process concerns regarding a similarly worded statute in Milewski.8 It is therefore unclear whether the court would uphold the new statute against a due-process challenge.
This potential legal issue may be avoided entirely by granting a BOR hearing even if the property owner denied an exterior view. The DOR recommends allowing a BOR hearing even if the property owner denied an interior or exterior view. The lack of access to view and the credibility of evidence offered as a result can be managed as an evidentiary issue at a BOR hearing, rather than denying a BOR hearing.
The following resources are available for municipalities, BOR members, property owners, and their representatives:
BOR Hearing Process
BOR hearings are open to the public.9 The following should attend hearings: assessor, property owner or duly authorized agent, BOR members, municipal attorney (optional), property owner’s lawyer (optional), the assessor’s lawyer (optional), and the municipal clerk (optional if not a member of the BOR). A record is created of all proceedings. The property owner or representative is heard first and is examined under oath.
The BOR is a quasi-judicial body and so parties have the right to cross-examine the adversarial parties’ witnesses. Property owners and assessors can ask each other questions. Members of the BOR may also ask questions.
The BOR must evaluate the weight of evidence and its effect on the presumption that the assessor is correct. A property owner may present information to the BOR that had not been provided to or known by the assessor. A property owner may appeal a land classification or valuation.
State law requires the assessor to classify land on the basis of use.10 There are eight statutory classifications for real property: residential, commercial, manufacturing, agricultural, undeveloped, agricultural forest, productive forest land, and other. Classification affects assessed value.
The BOR must meet annually during the 45-day period starting the fourth Monday of April.
For example, the standard for assessing agricultural land in Wisconsin is use-value. In use-value assessment, the use of the land is the most important factor in determining its assessed value. Use-value requires that the assessed value of farmland be based on the income that could be generated from its rental for agricultural use. A property owner that would like its property to be classified as agricultural would need to provide evidence that the land is devoted primarily to agricultural use.
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For valuation objections, the BOR looks first to whether there has been a recent sale of the property and then to whether sales of reasonably comparable property are available, as required by the Wisconsin Supreme Court case, State ex rel. Markarian v. City of Cudahy.11 The Markarian case confirmed a hierarchy of evidence as the best indicator of value and held that only in the absence of a recent, arm’s-length sale of the property in question and sales of reasonably comparable property can the assessor, in determining fair market value, consider all factors collectively that bear on the value of property.
Pursuant to the holding in Milewski,12 the court held that a property owner should not have to cede its Fourth Amendment right to be free from unreasonable searches and seizures, with the assessor as the governmental agent and the search as data collection through interior view, to gain its Fifth Amendment right to due process – the right to appeal valuation at the BOR. The shift provided in this decision makes lack of view an evidentiary consequence rather than an issue of availability of a BOR hearing. The BOR, as a quasi-judicial body, is required to weigh evidence presented that may be seen by only the property owner.
Here is an example: A property owner denies interior inspection but allows an exterior inspection. At the BOR, the property owner attempts to introduce testimonial evidence that the assessor was not allowed to view. What should the BOR do in weighing the credibility and relevance of that evidence?
A property owner may now deny an assessor entry inside a residence and still appeal to the BOR.
Considering the Markarian hierarchy, the BOR can ask the following when evaluating the credibility and relevance of evidence provided: 1) What is the effect of the offered evidence on overall valuation? 2) If the evidence submitted was viewed solely by the property owner, can the evidence offered be documented or corroborated? For example, if it is testimony – are verifiable photos or recordings available? 3) Is there a recent sale of the property? 4) If not, are there sales of comparable properties to justify the change to the assessor’s valuation? 5) What adjustments were made to the comparable sales? 6) Was an independent appraisal conducted? If so, what was the result?
Property owners should be prepared to answer these questions with credible evidence to prove the assessed value is in error. State law provides the BOR with the option to subpoena more evidence or ask further questions if provided with evidence showing an assessment may be in error.13 Based on the evidence, the BOR then makes a determination about classification or value.14
Recent statutory changes and case law highlight property owners’ Fourth Amendment privacy rights. However, the need for accurate data to create constitutionally sound valuations has not changed. While the impetus is on the assessor to find and validate that data, the property owner has an equally strong interest in accurate data being used as a basis for valuation.
The work of BOR members helps provide a fair and equitable system of property taxation in Wisconsin. The position is not well paid nor offered with great fanfare. However, the BOR is essential to protecting our constitutional rights in a fundamentally sound system. While no one is excited to receive their property tax bill or to go to the BOR, spring assessments are key to providing the property taxes necessary to fund the local governmental services all Wisconsin residents enjoy.
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Michelle Drea, Wisconsin Department of Revenue, Madison.
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1 Milewski v. Town of Dover, 2017 WI 79, 377 Wis. 2d 38, 899 N.W.2d 303.
2 Wis. Stat. § 70.47(6).
3 Wis. Stat. § 70.47(8)(i).
4 Wis. Stat. § 70.45.
5 Milewski, 2017 WI 79, 377 Wis. 2d 38.
6 Wis. Stat. § 66.0119.
7 Wis. Stat. § 70.47(7)(aa).
8 Milewski, 2017 WI 79, 377 Wis. 2d 38.
9 Wis. Stat. § 70.47.
10 Wis. Stat. § 70.32(2)(a).
11 State ex rel. Markarian v. City of Cudahy, 45 Wis. 2d 683, 173 N.W.2d 627 (1970).
12 Milewski, 2017 WI 79, 377 Wis. 2d 38.
13 Wis. Stat. § 70.47(8)(d).
14 Wis. Stat. § 70.47(9)(a).