A disagreement over the taxable value of Independence Village of Waterstone could end up costing Oxford Township a large chunk of tax revenue.
Independence Village filed a tax appeal petition on May 28, 2003 with the Michigan Tax Tribunal seeking to reduce the facility’s 2003 taxable value from $7,056,550 to $610,865 and 2003 State Equalized Value from $8,057,320 to $610,865.
If the tax appeal is successful, the township would be forced to refund Independence Village the sum of $59,180, plus interest and costs.
Independence Village of Waterstone is a 145,725-square-foot luxury retirement and assisted living community, which opened in 2003 and boasts 145 residential units.
According to township attorney Gary Rentrop, Independence Village filed a tax appeal with the township’s three-member Board of Review in March 2003, but the board upheld the property’s assessment, which was performed by the Oakland County Equalization Division, the entity which does all the township’s assessing.
In preparation for the state Tax Tribunal hearing, for which a date has not been set, the county will employ an independent appraiser to reaffirm its position, Rentrop said. This appraiser will cost $16,000.
County Equalization requested the township split that cost with them 50/50. In response, the township board Jan. 28 voted to spend up to $8,000 for the appraiser.
Independence Village stated the basis for their appeal in a March 4, 2003 letter to the township Board of Review.
“The equalized value and taxable value of each property exceed 50 percent of its true cash value in violation of applicable statutes and constitutional limitations,” wrote attorney Randall P. Whately, who’s representing Independence Village in this matter. “Under Michigan law true cash value is synonymous with market value. On behalf of the taxpayer, we do not believe that the usual selling price of this property would support the assessment, based on our knowledge of the market for this type of property. We are not aware of market transactions which, when properly analyzed, would support the valuation indicated by the assessment.”
“Furthermore, to the extent the cost approach was or could be applied to determine the true cash value of the assessed property referenced by this letter, we do not believe that the value indicated as of the tax date by subtracting all existing depreciation from replacement cost new, and adding the result to any applicable land value, will support the assessment,” Whately wrote.
As for the personal property such as furnishings, Whately wrote that the “original acquisition cost and multipliers used by the assessor do not account for functional obsolescence and economic obsolescence and do not reliably measure physical depreciation.”
Supervisor Bill Dunn said Independence Village’s value claims are “ridiculously low.”
“Walk through that place sometime and tell me if you think it’s worth the little bit they claim it is,” Dunn said. “If that’s really all they think it’s worth, I’ll offer to buy it right now. That’s a really great deal.”
Dunn said he’s confident the Tax Tribunal will uphold the county’s assessment of the facility, just as the township Board of Review did last year.