Court: No rehearing based on another decision

The Indiana Tax Court granted a petition for rehearing to clarify its ruling that a Hamilton County property qualified for a charitable/religious exemption. The Tax Court also denied rehearing a St. Joseph County case that claimed the decision in that case should be reconsidered based on the original ruling in the Hamilton County case.

On Wednesday, the Tax Court granted the petition for rehearing in Oaken Bucket Partners, LLC v. Hamilton County Property Tax Assessment Board of Appeals, et al., No. 49T10-0612-TA-113, and affirmed its previous decision in its entirety. The Tax Court held that a portion of Oaken Bucket's real property qualified for a charitable/religious purposes exemption for the 2004 tax year under Indiana Code Section 6-1.1-10-16. The Hamilton County Property Tax Assessment Board of Appeals and the county assessor filed a petition for rehearing because they believed the court committed reversible error when it failed to find Oaken Bucket had been prejudiced and that the earlier decision conflicts with Travelers' Insurance Co. v. Kent, 50 N.E. 562 (Ind. 1898), and Spohn v. Stark, 150 N.E. 787 (Ind. 1926).

The Tax Court disagreed, finding that when it determined that the Indiana Board's final determination wasn't supported by substantial evidence, it necessarily meant that the court found that Oaken Bucket had been prejudiced, wrote Judge Thomas Fisher. I.C. Section 33-26-6-4 doesn't state that a party may only be harmed when it suffers financial loss, but that the actions of the Indiana Board are the catalysts of prejudice.

Judge Fisher didn't find Oaken Bucket to conflict with the 1898 or 1926 decisions from the Indiana Supreme Court and pointed out that in 1975 the legislature rewrote the statute those cases relied on and removed certain words to make it less restrictive.

"In this case, the totality of the evidence established that Oaken Bucket possessed its own charitable purpose and that its property was both occupied and predominately used for religious purposes," he wrote.

The Tax Court denied rehearing in Jamestown Homes of Mishawaka, Inc. v. St. Joseph County Assessor, No. 49T10-0802-TA-17, which the court originally handed down the same day as its ruling in Oaken Bucket. The Tax Court affirmed that Jamestown Homes of Mishawaka wasn't entitled to a property tax exemption on apartments it leased to low- and moderate-income people for below-market rent. Jamestown petitioned for rehearing, believing the Tax Court has to reconsider its decision based on the ruling in Oaken Bucket, and because the Tax Court created a new burden of proof.

In Oaken Bucket, there was no question the subject property was occupied and used for religious purposes; Jamestown, however, failed to show that its federal-subsidized, low-income housing was property used for a charitable purpose, Judge Fisher wrote.

Jamestown also claimed the Tax Court strayed from applying the well-established test for determining whether property qualifies for the exemption and applied a "new test." But the Tax Court didn't apply a new test and actually just explained to Jamestown that in order to meet its burden of proof, it had to do more than make statements that the provision of low-income housing is a charitable purpose, wrote the judge.