|Case Forum:||Michigan Supreme Court|
|Keywords:||dark store, Michigan Tax Tribunal (MTT), valuation, value-in-use valuation, cost-less-depreciation valuation|
Stephanie Simon Morita (P53864) | Johnson Rosati Schultz & Joppich, PC | 27555 Executive Drive, Suite 250 | Farmington Hills, MI 48331 | 248-489-4100
1. Michigan Townships Association (MTA)
The decision in Clark is still valid precedent and applies to this case. The claim that somehow the Clark decision does not employ a proper cost-less-depreciation methodology that does not account for depreciation is belied by the fact that even in Clark the tribunal applied a substantial depreciation factor. Further, more recent decision of the courts have continued to utilize the cost-less-depreciation method where the property’s existing use is also its highest and best use, and there are insufficient appropriate sales comparables. Since this case has yet to be remanded for a determination as to whether the sales comparables can be adjusted and appropriately utilized, the claim the Court of Appeals has somehow mandated a cost-less-depreciation method is premature and untrue. The holdings in Clark are applicable to this case and it was not error for the Court of Appeals to rely upon them. The Court of Appeals properly determined that this case should be remanded for the taking of more testimony and evidence as to the effect of the deed restrictions, as well as for the consideration of the cost-less-depreciation approach. To do so was not an impermissible substitution of the tribunal’s weight of the evidence determinations when the tribunal’s determinations were not based upon the record as a whole and thereby constituted an error of law. Requiring the tribunal to look at the whole record and take additional evidence to support the tribunal’s determinations does not cause material injustice and is consistent with the other decisions of the courts.
|MSC requested LDF amicus brief?||No|
This case arises out of ad valorem property tax assessments for the tax years 2012, 2013, and 2014. The subject property is a 166,196 square foot “big-box” store built on 18.35 acres and