70.32 Cross-reference
Cross-reference: See also ch.
Tax 18, Wis. adm. code.
70.32 Annotation
When market value is established by a fair sale of the property or sales of reasonably comparable property are available, it is error for an assessor to resort to other factors to determine fair market value, although such factors in the absence of such sales would have a bearing on market value. Rules on judicial review of valuation presuppose that the method of evaluation is in accordance with the statutes; hence errors of law should be corrected by the court on certiorari and the failure to make an assessment on the statutory basis is an error of law. State ex rel. Markarian v. Cudahy,
45 Wis. 2d 683,
173 N.W.2d 627 (1970).
70.32 Annotation
While a sale establishes value, the assessment still has to be equal to that on comparable property. Sub. (2) requires the assessor to fix a value before classifying the land; it does not prohibit the assessor from considering the zoning of the property when it is used for some other purpose. State ex rel. Hensel v. Town of Wilson,
55 Wis. 2d 101,
197 N.W.2d 794 (1972).
70.32 Annotation
In making an assessment based on a recent sale of the property, the assessor cannot increase the value because no commission was paid to a broker. Lincoln Fireproof Warehouse v. Milwaukee Board of Review
60 Wis. 2d 84,
208 N.W.2d 380 (1973).
70.32 Annotation
Under an option agreement, the sellers' right to repurchase their homestead and their right of first refusal for the purchase of industrial buildings to be constructed on the property were factors going only to the willingness of the parties to deal, not their compulsion to do so; the value of these rights, together with the monetary amount per acre, comprised the total sale price of the land. Geipel v. Milwaukee,
68 Wis. 2d 726,
229 N.W.2d 585 (1975).
70.32 Annotation
Evidence of net income from unique property was admissible to show market value. An assessor's unconfirmed valuation based on estimated replacement cost less depreciation could not stand alone because of uncontroverted evidence of actual costs of recent construction. Rosen v. Milwaukee,
72 Wis. 2d 653,
242 N.W.2d 681 (1976).
70.32 Annotation
When there are no actual sales, cost, depreciation, replacement value, income, industrial conditions, location and occupancy, sales of like property, book value, insurance carried, value asserted in a prospectus, and appraisals are all relevant to determination of market value for assessment purposes. Mitchell Aero, Inc. v. Milwaukee Board of Review,
74 Wis. 2d 268,
246 N.W.2d 521 (1976).
70.32 Annotation
District-wide use of comparative sales statistics to determine annual percentage increases of assessments was invalid under sub. (1). Kaskin v. Board of Review,
91 Wis. 2d 272,
282 N.W.2d 620 (Ct. App. 1979). See also Lloyd v. Board of Review of City of Stoughton,
179 Wis. 2d 33,
505 N.W.2d 465 (Ct. App. 1993).
70.32 Annotation
An assessor erred in failing to consider disadvantages and liabilities that affect the fair market value of dams. Wisconsin Edison Corp. v. Robertson,
99 Wis. 2d 561,
299 N.W.2d 626 (Ct. App. 1980).
70.32 Annotation
The lease of comparable property constituted the "best information" regarding fair market value of leasehold improvements. Keane v. Bd. of Review,
99 Wis. 2d 584,
299 N.W.2d 638 (Ct. App. 1980).
70.32 Annotation
Sub. (1) requires the use of a cash equivalency adjustment in assessing property based upon the sale of comparable properties. Flint v. Kenosha County Rev. Bd.
126 Wis. 2d 152,
376 N.W.2d 364 (Ct. App. 1985).
70.32 Annotation
An assessment largely based upon consideration of equalized value was invalid. The court erred by remanding with the requirement that a new assessment consider the actual subsequent sale of the subject property. Kesselman v. Sturtevant,
133 Wis. 2d 122,
394 N.W.2d 745 (Ct. App. 1986).
70.32 Annotation
The board of review erred as a matter of law by basing an assessment on "market" rental income when there was a recent arms-length sale of the property. Darcel v. Manitowoc Review Board,
137 Wis. 2d 623,
405 N.W.2d 344 (1987).
70.32 Annotation
In determining market value under sub. (1), the board of review must determine whether financing arrangements between the seller and buyer affected the sale price; sub. (1) prohibits assessment exceeding market value. Flood v. Lomira Board of Review,
153 Wis. 2d 428,
451 N.W.2d 422 (1990).
70.32 Annotation
Factors applicable to the assessment of commercial property following its sale are discussed. State v. Greendale Board of Review,
164 Wis. 2d 31,
473 N.W.2d 554 (Ct. App. 1991).
70.32 Annotation
Section 70.32 establishes a unitary taxing scheme; mineral rights are taxed as an element of the real estate and not separately. Cornell University v. Rusk County,
166 Wis. 2d 811,
481 N.W.2d 485 (Ct. App. 1992).
70.32 Annotation
The capitalization of income method, based on estimated market rents rather than on actual rent, was an improper method of assessing subsidized rental property. Metro. Holding v. Milwaukee Review Bd.
173 Wis. 2d 626,
495 N.W.2d 314 (1993).
70.32 Annotation
Compliance with the s. 73.03 (2a) assessment manual is not a defense when the method of assessment violates s. 70.32 (1). Metropolitan Holding Co. v. Milwaukee Board of Review,
173 Wis. 2d 626,
495 N.W.2d 314 (1993).
70.32 Annotation
When an assessor disavows the correctness of a valuation of comparable property shown on the tax roll, the burden is on the assessor to explain why the assessment is incorrect. Brighton Square Co. v. Madison,
178 Wis. 2d 577,
504 N.W.2d 436 (Ct. App. 1993).
70.32 Annotation
A taxpayer challenging an assessment has the burden of proving that a sale was an arm's-length transaction. The taxpayer has the burden of proof on each assessment manual condition that must be met. Doneff v. Review Board of Two Rivers,
184 Wis. 2d 203,
516 N.W.2d 383 (1994).
70.32 Annotation
The use of owner-operator income to value property is allowed if the net income reflects the property's chief source of value, the income is produced without skill of the owner, or the owner's skill and labor are factored out and other valuation approaches are considered. Waste Management v. Kenosha County Board of Review,
184 Wis. 2d 541,
516 N.W.2d 695 (1994).
70.32 Annotation
There is no bright line rule for the number of comparable properties that must be shown to prove that the rule of uniformity is being violated. Assessments that are discriminatory and made based on arbitrary and improper considerations cannot stand. Levine v. Fox Point Board of Review,
191 Wis. 2d 363,
528 N.W.2d 424 (1995).
70.32 Annotation
Property that is encumbered by a bundle of rights must be appraised at its value using the current value of that bundle of rights. City of West Bend v. Continental IV Fund,
193 Wis. 2d 481,
535 N.W.2d 24 (Ct. App. 1995).
70.32 Annotation
Real property shall be valued based on the best information available. The best information is a recent arms-length sale of the property, followed by recent sales of comparable property. If either of those are not available the assessor may look to all factors that collectively have a bearing on the value of the property. Campbell v. Town of Delavan,
210 Wis. 2d 239,
565 N.W.2d 209 (Ct. App. 1997),
96-1291.
70.32 Annotation
Equalized value is not a measure of fair market value of individual properties; it is improper for an assessor to take it into account in valuing property. Noah's Ark Family Park v. Village of Lake Delton,
210 Wis. 2d 301,
565 N.W.2d 230 (Ct. App. 1997),
96-1074.
70.32 Annotation
For purposes of the uniformity clause, there is only one class of property. The burden of taxation must be borne as nearly as practicable among all property, based on value. Compliance with the requirement of s. 70.05 (5) that property be assessed at fair value at least once every 5 years is not a substitute for compliance with the uniformity clause and sub. (1). Approving an increased assessment for only one property despite evidence that it and other properties had recent sales at a price above prior assessments violated the law, and its approval by the board of review was arbitrary. Noah's Ark Family Park v. Village of Lake Delton,
210 Wis. 2d 301,
565 N.W.2d 230 (Ct. App. 1997),
96-1074.
70.32 Annotation
It was improper to rely solely on insurance replacement value to set the valuation of low income apartments encumbered with income and rental restrictions, although it is a relevant factor. Walworth Affordable Housing, LLC v. Village of Walworth,
229 Wis. 2d 797,
601 N.W.2d 325 (Ct. App. 1999),
98-2535.
70.32 Annotation
Income that is attributable to land, rather than personal to the owner, is inextricably intertwined with the land and is transferable to future owners. This income may be included in the land's assessment because it appertains to the land. Income from managing separate off-site property may be inextricably intertwined with land and subject to assessment if the income is generated primarily on the assessed property itself. ABKA Ltd. v. Fontana-On-Geneva-Lake,
231 Wis. 2d 328,
603 N.W.2d 217 (1999),
98-0851.
70.32 Annotation
The requirement to use the "best information" does not require that an assessor use actual figures in the absence of a sale. An assessor acted properly in using estimated expense figures when actual figures did not reflect regular expenses. ABKA Ltd. v. Fontana-On-Geneva-Lake,
231 Wis. 2d 328,
603 N.W.2d 217 (1999),
98-0851.
70.32 Annotation
It is clear from the Assessor's Manual that assessors should consider many market factors from a variety of sources when gathering and applying comparable sales information. Even sales prices of similar properties need some adjustment in order to arrive at an estimate of value for a different property. Joyce v. Town of Tainter,
2000 WI App 15,
232 Wis. 2d 349,
605 N.W.2d 284,
99-0324.
70.32 Annotation
An assessor cannot be free to choose between the mortgage subsidy rate and the mortgage market rate when using the income approach to valuing federally subsidized housing. If the use of a market rate was proper in
City of Bloomer, the use of a subsidized interest rate cannot be. Mineral Point Valley Limited Partnership v. City of Mineral Point,
2004 WI App 158,
275 Wis. 2d 784,
686 N.W.2d 697,
03-1857 70.32 Annotation
When a property carries with it a bundle of rights, an assessment must be based on the property at its value using the current value of that bundle of rights. A buyer necessarily acquires the right to the rents guaranteed in long-term leases. The goal of assessment is to ascertain what an investor would pay for the property, and contract rents, not market rents, whether above or below market rent, are the clearest indicator of what the investor would pay. Walgreen Co. v. City of Madison,
2007 WI App 153,
303 Wis. 2d 620,
735 N.W.2d 543,
06-1859.
70.32 Annotation
A property tax assessment of retail property leased at above-market rent values should be based on market rents and not on the above-market rental terms of the actual lease. Walgreen Co. v. City of Madison,
2008 WI 80,
311 Wis. 2d 158,
752 N.W.2d 687,
06-1859.
70.32 Annotation
When an assessor only after looking at prevailing market conditions and all variables determined that the market for lakefront property had grown so strong that factors other than beach length and beach quality were being ignored by the marketplace, the approach was not formulaic and is not in violation of
Campbell. Anic v. Board of Review of the Town of Wilson,
2008 WI App 71,
311 Wis. 2d 701,
751 N.W.2d 870,
07-0761.
70.32 Annotation
An assessment based on a Department of Revenue analysis of the sale of a mining company that owned the land was not based upon a recent arm's-length sale of the property. A value derived by analyzing a complex corporate transaction involving the sale of a variety of assets, tangible and intangible, independent and interdependent, is not equivalent to the price obtained in a sale of one component of that transaction. Forest County Potawatomi Community v. Township of Lincoln,
2008 WI App 156,
314 Wis. 2d 363,
761 N.W.2d 31,
07-2523.
70.32 Annotation
The Assessment Manual and case law set forth a 3-tier system for determining the fair market value of property. A recent arm's-length sale of the property is the best evidence of value, and is the basis for an assessment under tier one. If there has been no recent sale, an assessor must consider sales of reasonably comparable properties, which is the tier 2 approach. In the absence of comparable sales data, the assessor determines the value under tier 3, which permits consideration of all the factors collectively that have a bearing on value of the property in order to determine its fair market value. Nestle USA, Inc. v. DOR,
2009 WI App 159,
322 Wis. 2d 156,
776 N.W.2d 589,
08-0322.
70.32 Annotation
Absent sufficient proof that no market existed for a property having a specialized use, an assessment under the tier 2 comparable sales approach based on an expanded definition of highest and best use to include a use for which a market exists would be contrary to sub. (1). The taxpayer has the burden of proving the absence of a market for the property with its current specialized use. That there were no known sales of properties put to that special use merely suggests that such properties are rarely bought and sold. It does not necessarily indicate that the taxpayer would be unable to find a buyer who intended to maintain the property as its current use. Nestle USA, Inc. v. DOR,
2009 WI App 159,
322 Wis. 2d 156,
776 N.W.2d 589,
08-0322.
70.32 Annotation
When there are no sales of the property itself or of reasonably comparable properties, an assessment cannot be made under a tier one or tier 2 methodology. The assessment is then made using a tier 3 methodology. The cost of replacement approach is the preferred tier 3 method of valuation when, as here, the property has a highly specialized use resulting in there being no comparable properties. Nestle USA, Inc. v. DOR,
2009 WI App 159,
322 Wis. 2d 156,
776 N.W.2d 589,
08-0322.
70.32 Annotation
In situations when it has been determined that there is no potential market for the subject property, it is contrary to sub. (1) to conclude that the highest and best use of the property should remain the same. That was not the case when there was at least a limited market for powdered infant formula production facilities. Nestle USA, Inc. v. Wisconsin Department of Revenue,
2011 WI 4,
331 Wis. 2d 256,
795 N.W.2d 46,
08-0322.
70.32 Annotation
Reassessing one property at a significantly higher rate than comparable properties using a different methodology and then declining to reassess the comparable properties by that methodology violates the uniformity clause. U.S. Oil Co., Inc. v. City of Milwaukee,
2011 WI App 4,
331 Wis. 2d 407,
794 N.W.2d 904,
09-2260.
70.32 Annotation
Comparing a taxpayer's appraised value to lower values assigned to a relatively small number of other properties has long been rejected as a claimed violation of the uniformity clause. Lack of uniformity must be established by showing a general undervaluation of properties within a district when the subject property has been assessed at full market value. Great Lakes Quick Lube, LP v. City of Milwaukee,
2011 WI App 7,
331 Wis. 2d 137,
794 N.W.2d 510,
09-2775.
70.32 Annotation
A property's assessed value is based on fair market value but a property's assessed value is not necessarily equal to its fair market value. Assessors must base assessments of real property on the property's fair market value. However, as the plain language of the Property Assessment Manual makes clear, a property's fair market value is not synonymous with its assessed value. In most cases individual property assessments are different than the property's fair market value. Stupar River LLC v. Town of Linwood Board of Review,
2011 WI 82,
336 Wis. 2d 562,
800 N.W.2d 468,
09-0191.
70.32 Annotation
The taxpayer challenging an assessment and classification has the burden of proving at the board hearing that the assessment and classification of property are erroneous; that the taxpayer did not meet his burden of proof; and that the board's determination to maintain the assessment is supported by a reasonable view of the evidence. Sausen v. Town of Black Creek Board of Review,
2014 WI 9,
352 Wis. 2d 576,
843 N.W.2d 39,
10-3015.
70.32 Annotation
Except for sub. (2) (c) 3., every subdivision of sub. (2) (c) uses the verb "means" instead of "includes" when defining a property classification. "Means" clearly limits the classes of property defined in those subdivisions to the specific types of property described therein. If the legislature intended the residential class to be restricted to the type of property described in sub. (2) (c) 3., it would have used the verb "means" instead of "includes." Aside from the property specifically described in sub. (2) (c) 3., any other property included in the residential class must fall within the ordinary meaning of the term "residential." West Capitol, Inc. v. Village of Sister Bay,
2014 WI App 52,
354 Wis. 2d 130, ___ N.W.2d ___,
13-1458.
70.32 Annotation
Nothing in s. 70.10 requires a property to be classified based on its actual use or prevents an assessor from considering a property's most likely use. An owner's subjective expression of intent is not dispositive of a property's most likely use. The Assessment Manual directs assessors to consider whether the property owner's actions are consistent with an intent for residential use, but that is only one of 7 factors the Manual directs assessors to consider. West Capitol, Inc. v. Village of Sister Bay,
2014 WI App 52,
354 Wis. 2d 130, ___ N.W.2d ___,
13-1458.
70.32 Annotation
A property need not be zoned residential in order to be classified as residential for property tax purposes, as long as residential use is likely to be allowed. West Capitol, Inc. v. Village of Sister Bay,
2014 WI App 52,
354 Wis. 2d 130, ___ N.W.2d ___,
13-1458.
70.32 Annotation
Under sub. (2) (c) 4., land is nonproductive when it is neither producing nor capable of productive use. Property that is capable of productive use is not nonproductive and not entitled to the 50-percent assessment reduction under sub. (4). West Capitol, Inc. v. Village of Sister Bay,
2014 WI App 52,
354 Wis. 2d 130, ___ N.W.2d ___,
13-1458.
70.32 Annotation
Taxation of undeveloped real property in Wisconsin. Hack, Sullivan, 1974 WBB No. 1.
70.323
70.323
Assessment of divided parcel. 70.323(1)(a)(a) If a parcel of real property is divided, the owner of a divided parcel may request a valuation of the divided parcels. A request shall be in writing and submitted to the treasurer of the taxation district in which the property is located. If the taxation district treasurer is in possession of the tax roll, the treasurer shall make the requested valuation. If the tax roll has been returned under
s. 74.43, the taxation district treasurer shall forward the request to the county treasurer, who shall make the requested valuation.
70.323(1)(b)
(b) The appropriate treasurer shall, with the assistance of the assessor of the taxation district, attribute to each new parcel its value for the year of division. The value of each new parcel shall represent a reasonable apportionment of the valuation of the original undivided parcel, and the total of the new valuations shall equal the valuation of the original undivided parcel on January 1 of that year. The value of a new parcel as determined under this subsection is the value of that property for purposes of
s. 70.32 for the year of division.
70.323(2)
(2) Appeal. A determination under
sub. (1) may be appealed by bringing an action in circuit court within 60 days after the determination is made. The court shall determine whether the value determined under
sub. (1) represents a reasonable apportionment of the valuation of the original undivided parcel on January 1 of that year. If the court determines that the value does not represent a reasonable apportionment, the court shall redetermine the parcels' values, the total of which shall equal the valuation of the original undivided parcel on January 1 of that year.
70.323(3)
(3) Lien extinguished. Payment of all real estate taxes based on the value determined under
sub. (1) or
(2) extinguishes the lien against the parcel created under
s. 70.01.
70.323(4)
(4) Cooperation of assessor. The assessor of the taxation district shall assist the treasurer of the taxation district or of the county under
sub. (1).
70.323(5)
(5) Not applicable where written agreement. This section does not apply if there is a written agreement providing for the payment of real property taxes on the divided parcels in the year of division.
70.323 History
History: 1987 a. 378.
70.327
70.327
Valuation and assessment of property with contaminated wells. In determining the market value of real property with a contaminated well or water system, the assessor shall take into consideration the time and expense necessary to repair or replace the well or private water system in calculating the diminution of the market value of real property attributable to the contamination.
70.327 History
History: 1983 a. 410;
1995 a. 378.
70.337
70.337
Tax exemption reports. 70.337(1)
(1) By March 31 of each even-numbered year, the owner of each parcel of property that is exempt under
s. 70.11 shall file with the clerk of the taxation district in which the property is located a form containing the following information:
70.337(1)(a)
(a) The name and address of the owner of the property and, if applicable, the type of organization that owns the property.
70.337(1)(b)
(b) The legal description and parcel number of the property as shown on the assessment roll.
70.337(1)(d)
(d) A description of any improvements on the land.
70.337(1)(e)
(e) A statement indicating whether or not any portion of the property was leased to another person during the preceding 2 years. If the property was leased, the statement shall identify the portion of the property that was leased, identify the lessee and describe the ways in which the lease payments were used by the owner of the property.
70.337(1)(f)
(f) The owner's estimate of the fair market value of the property on January 1 of the even-numbered year. The owner shall provide this estimate by marking one of a number of value ranges provided on the form prepared under
sub. (2). The assessor for the taxation district within which the property is located may review the owner's estimate of the fair market value of the property and adjust it if necessary to reflect the correct fair market value.
70.337(2)
(2) By July 1 of each even-numbered year, the clerk of each taxation district shall complete and deliver to the department of revenue a form on which the clerk estimates the value of tax-exempt property, classified by type of owner, within the taxation district.
70.337(3)
(3) The department of revenue shall prescribe the contents of the form for reporting the information required under
sub. (1), including the categories of value of property that the department of revenue determines will result in the best estimate of the value of tax-exempt property in this state. The department of revenue shall also prescribe the contents of the form under
sub. (2). The form under
sub. (2) shall provide for estimates of the value of tax-exempt property in the taxation district that is owned by various categories of owners, including property that is owned by the benevolent and educational associations; fraternal and labor organizations; nonprofit hospitals; private colleges; and churches and religious associations. The forms under
subs. (1) and
(2) shall be prepared and distributed under
s. 70.09 (3).
70.337(4)
(4) The department of revenue shall tabulate data from the forms received under
sub. (2) and prepare an estimate of the value of tax-exempt property in this state by category of owner. The department shall include this information in the summary of tax exemption devices prepared under
s. 16.425 (3).
70.337(5)
(5) Each person that is required to file a report under
sub. (1) shall pay a reasonable fee that is sufficient to defray the costs to the taxation district of distributing and reviewing the forms under
sub. (1) and of preparing the form for the department of revenue under
sub. (2). The amount of the fee shall be established by the governing body of the taxation district. This subsection does not apply to a church that is required to file a report under
sub. (1).
70.337(6)
(6) If the form under
sub. (1) is not received by March 31 of the even-numbered year, the taxation district clerk shall send the owner of the property a notice, by certified mail, stating that the property for which the form is required will be appraised at the owner's expense if a completed form is not received by the taxation district clerk within 30 days after the notice is sent. If the completed form is not received by the taxation district clerk within 30 days after the notice is sent, the property shall be appraised either by the taxation district assessor or by a person hired by the taxation district to conduct the appraisal.
70.337(7)
(7) This section does not apply to property that is exempt under
s. 70.11 (1),
(2),
(13),
(13m),
(15),
(15m),
(21) or
(30), property that is exempt under
s. 70.11 (18) if a payment in lieu of taxes is made for that property, lake beds owned by the state, state forests under
s. 28.03 or
28.035, county forests under
s. 28.10, property acquired by the department of transportation under
s. 85.08 or
85.09 or highways, as defined in
s. 340.01 (22).
70.339
70.339
Reporting requirements. 70.339(1)
(1) By March 15 each person that owns property that is exempt under
s. 70.11, except
s. 70.11 (1) and
(2), and that was used in the most recently ended taxable year in a trade or business for which the owner of the property was subject to taxation under sections
511 to
515 of the internal revenue code, as defined in
s. 71.22 (4m), shall file with the clerk of the taxation district in which the property is located a statement containing the following information:
70.339(1)(a)
(a) The name, address and telephone number of the owner of the property.
70.339(1)(b)
(b) The name, address and telephone number of a person who can be contacted concerning the use of the property in a trade or business.
70.339(1)(c)
(c) A general description of the activities engaged in to conduct the trade or business.
70.339(1)(d)
(d) The location and a description of the property that is used in the trade or business including, if applicable, the specific portion of a building that is used to conduct the trade or business.
70.339(2)
(2) The format and distribution of statements under this section shall be governed by
s. 70.09 (3).
70.339(3)
(3) If the statement required under this section is not received by the due date, the taxation district clerk shall send the owner of the property a notice, by certified mail, stating that failure to file a statement is subject to the penalties under
sub. (4).
70.339(4)
(4) A person who fails to file a statement within 30 days after notification under
sub. (3) shall forfeit $10 for each succeeding day on which the form is not received by the taxation district clerk, but not more than $500.
