decided: June 17, 1965.
SCHENLEY LAND COMPANY, APPELLANT,
ALLEGHENY COUNTY BOARD OF PROPERTY ASSESSMENT
Appeal from order of Court of Common Pleas of Allegheny County, Oct. T., 1960, No. 371, in case of Schenley Land Company v. Board of Property Assessment, Appeals and Review of Allegheny County.
Leonard M. Mendelson, with him Edward C. Leckey, for appellant.
Francis A. Barry, First Assistant County Solicitor, with him James Victor Voss, Assistant County Solicitor, and Maurice Louik, County Solicitor, for appellee.
Ervin, P. J., Wright, Watkins, Montgomery, Jacobs, and Hoffman, JJ. (Flood, J., absent). Opinion by Ervin, P. J. Wright, J., concurs in the result.
[ 205 Pa. Super. Page 578]
Schenley Land Company owned two three-story brick apartment buildings in Pittsburgh, known as 5615 and 5625 Hempstead Road. The Board assessed this property at $151,450 for the triennial years beginning in 1960, being an assessment of $19,650 for the land and $65,900 each for the buildings. On appeal by the taxpayer the board sustained the assessment. Appellant then appealed to the Court of Common Pleas, alleging the assessment exceeded the market value of the property and that lack of uniformity existed.
[ 205 Pa. Super. Page 579]
The board offered in evidence a certified copy of the assessment record and rested, thus establishing a prima facie case for the validity of the assessment: N. Park Village, Inc. v. Board of Property Assessments, 408 Pa. 433, 184 A.2d 253. Through a bookkeeper, appellant offered in evidence the income and expense statements of the apartments for the years 1958 and 1959. The second witness for appellant, Mr. Strauss, a real estate expert, testified the market value of the property was $17,000 for the land and $113,000 for the buildings (total of $130,000) compared to an assessment of $151,450, and that the ratio of assessed to market value was 116%. Mr. Strauss cited five other apartment buildings as alleged comparables and gave his opinion as to the market value compared to the assessed value of each property. On the basis of these figures he found a ratio of assessed to market value of approximately 71%, all ratios being between 70% and 72% as to these comparable apartments.
Appellant also offered in evidence the report of the State Tax Equalization Board to show the ratio between assessed and market value for Allegheny County. The court below excluded such evidence.
The court below rejected in large measure the testimony of Mr. Strauss, on the ground he improperly considered reproduction costs in determining market value of appellant's and the alleged comparable properties. The court also stated that Mr. Strauss relied heavily on the income statements which did not reflect the true economic picture of the property because (1) they did not disclose mortgage payments or depreciation factors and (2) the statements were prepared for income tax purposes.
[ 205 Pa. Super. Page 580]
Admittedly depreciated reproduction cost may not be a major or basic factor in determining market value: Buhl Foundation v. Bd. of Property Assessment, 407 Pa. 567, 180 A.2d 900; Baldwin-Lima-Hamilton Corp. Page 580} Appeal, 412 Pa. 299, 194 A.2d 434. Here, however, it is clear Strauss did not base his estimate of market value to any material degree on reproduction cost, or to such extent as to invalidate his testimony on market value: Cf. Crucible Steel Co. v. Allegheny County Board of Property Assessment, Appeals & Review, 356 Pa. 373, 52 A.2d 190. For instance, Strauss stated on redirect examination that the reproduction cost would not affect his valuation. Nor were the income statements irrelevant or invalid because they did not contain mortgage or depreciation figures, or because they were prepared for income tax purposes. This evidence of income derived from the property was relevant on the issue before the court and should have been considered by it: Park Drive Manor, Inc. Tax Assessment Case, 380 Pa. 134, 110 A.2d 392; Flamingo Apartments, Inc. v. Board of Revision of Taxes, 383 Pa. 223, 118 A.2d 197; Buchman Tax Assessment Case, 164 Pa. Superior Ct. 137, 63 A.2d 136.
Strauss' testimony as to comparables was admissible both to show market value of the contested property, and also to show lack of uniformity: Deitch Co. v. Board of Property Assessment, 417 Pa. 213, 209 A.2d 397; McKnight Shopping Center, Inc. v. Board of Property Assessment, 417 Pa. 234, 209 A.2d 389.
In this case no countervailing evidence was offered by the board. Where no countervailing proof is offered by the board and the taxpayer's evidence is relevant and credible, it must be given due weight and cannot be ignored by the court: Deitch Co. v. Board of Property Assessment, supra; McKnight Shopping Center, Inc. v. Board of Property Assessment, supra. As indicated in McKnight Shopping Center, Inc. v. Board of Property Assessment, supra, while the testimony of appellant's witnesses may not have been completely satisfactory, it "cannot be disregarded unless the lower court in the exercise of its discretion
[ 205 Pa. Super. Page 581]
finds it incredible." The statement of the court below that there is no competent evidence to show the assessment is unfair, or lacking in uniformity, is not supported by the record.
This appeal also raises the question whether the State Tax Equalization Board figures were admissible to show the ratio of assessed to market value in the district. This evidence is not, under the implications of Pittsburgh Miracle Mile Town & Country Shopping Center, Inc. v. Board of Property Assessment, 417 Pa. 243, 209 A.2d 394, presently admissible, and the ruling of the court below on this point was correct.
Section 17 of the Act of June 27, 1947, P. L. 1046, 72 PS § 4656.17, which created the State Tax Equalization Board, provides as follows: "Nothing contained in this act shall be construed to change or affect the validity of the assessed valuation of any real property for the purpose of levying taxes by any political subdivision."
The very purpose of the offer of the report was "to change or affect the validity of the assessed valuation of" the real estate involved in this appeal. The offer, therefore, flies in the teeth of § 17 and could not be admitted.*fn1
[ 205 Pa. Super. Page 587]
The court below was in error in its view that much of appellant's evidence on market value and uniformity was invalid. The case should be reviewed and consideration given to the recent Supreme Court cases of Deitch Co. v. Board of Property Assessment, supra, and McKnight Shopping Center, Inc. v. Board of Property Assessment, supra.
The order of the court below is vacated and the case is remanded for further proceedings consistent with this opinion.