AI- 8347
.
Special/Executive Session Board of Supervisors Mtg - 9:00 am
- Meeting Date:
- 03/20/2025
- Title:
- Large Tax Appeal CDS TWO LP v. Cochise County, TX2024-000242
- Submitted By:
- Lara Loewenheim, Board of Supervisors
- Department:
- Board of Supervisors
Presentation:
No A/V Presentation
Recommendation:
Document Signatures:
# of ORIGINALS
Submitted for Signature:
Submitted for Signature:
NAME
of PRESENTER:
of PRESENTER:
Paul Correa
TITLE
of PRESENTER:
of PRESENTER:
Chief Civil Deputy County Attorney
Mandated Function?:
Source of Mandate
or Basis for Support?:
or Basis for Support?:
Information
Agenda Item Text:
Discussion, direction and possible action regarding the proposed settlement of the Large Tax Appeal CDS TWO LP v. Cochise County, TX2024-000252, now pending in Arizona Tax Court, a division of the Superior Court of and for Maricopa County.
Pursuant to A.R.S. § 38-431.03 (A)(3) and (4), the Board may go into executive session for legal advice with the attorney of the public body and to consider its position and instruct attorneys regarding the public body’s position in pending litigation.
Pursuant to A.R.S. § 38-431.03 (A)(3) and (4), the Board may go into executive session for legal advice with the attorney of the public body and to consider its position and instruct attorneys regarding the public body’s position in pending litigation.
Background:
Taxpayer filed a civil action in Arizona Tax Court, seeking a reduction in assessed value for parcel number 105-08-007H and account number R010051285 for tax year 2025. Taxpayer submitted a proposed settlement offer on January 27, 2025. After inspecting the property on February 3, 2025, reviewing the taxpayers’ documentation which included Declaration of Affirmative Land and Covenants Agreement (LURA) and Arizona Department of Housing Low Income Housing Tax Credit Program Application, which included purposed financial statements and pro-forma income and expense date, the Assessor has determined that the Subject Property meets the statutory valuation qualification of a Low Income Housing Tax Credit (LIHTC) property pursuant to A.R.S. § 42 Article 13 of Chapter 13, and is subject to restricted rents and increased expenses due to enrollment in the LIHTC program. The Assessor agrees that the parcel’s full cash value for tax year 2025 should be lowered at 100% complete status and limited property value determined pursuant to A.R.S. § 42-13302(3). The Assessor’s recommended settlement offer is as follows:
• For tax year 2025, a reduction in full cash value from $5,754,147 to $2,841,477.
• For tax year 2025, a reduction in limited property value from $4,223,423 to $2,085,584.
• The assessment ratio shall remain at 10%.
• The legal class shall remain class 4 (residential).
Assessor shall recalculate the 2025 taxes on the subject property based upon full cash value and limited property value as stated above.
Pursuant to A.R.S. 42-16002, the Subject Property's reduced full cash value for the 2025 tax year as determined per the stipulated judgment shall be its full cash value for the 2026 tax year.
Based upon the reduction in full cash and limited property values of the Subject Property for the 2025 tax year, the Treasurer’s Office will calculate the refund owed, plus any interest at the legal rate pursuant to A.R.S. § 42-16214(A)(3) paid to Plaintiff’s attorney’s trust account.
Each party would bear their own attorneys’ fees and costs.
The taxpayer has accepted the settlement offer.
• For tax year 2025, a reduction in full cash value from $5,754,147 to $2,841,477.
• For tax year 2025, a reduction in limited property value from $4,223,423 to $2,085,584.
• The assessment ratio shall remain at 10%.
• The legal class shall remain class 4 (residential).
Assessor shall recalculate the 2025 taxes on the subject property based upon full cash value and limited property value as stated above.
Pursuant to A.R.S. 42-16002, the Subject Property's reduced full cash value for the 2025 tax year as determined per the stipulated judgment shall be its full cash value for the 2026 tax year.
Based upon the reduction in full cash and limited property values of the Subject Property for the 2025 tax year, the Treasurer’s Office will calculate the refund owed, plus any interest at the legal rate pursuant to A.R.S. § 42-16214(A)(3) paid to Plaintiff’s attorney’s trust account.
Each party would bear their own attorneys’ fees and costs.
The taxpayer has accepted the settlement offer.
Department's Next Steps (if approved):
Upon approval by the Board, the parties will file the stipulated judgment with the Arizona Tax Court disposing of this matter, pursuant to the settlement terms.
Impact of NOT Approving/Alternatives:
Additional litigation for the County with the risk that the Court may: (1) rule in the taxpayer’s favor; (2) order a larger reduction in the assessed value of the subject property; and (3) order the County to pay the Plaintiff’s fees and costs.
To BOS Staff: Document Disposition/Follow-Up:
Advise County Attorney's Office - Civil Division upon Board's approval.