We granted certiorari in this real property tax case to determine whether the court of appeals assigned the appropriate burden of proof to a taxpayer in a proceeding before the Colorado Board of Assessment Appeals (“BAA”). Sampson v. Teller County Bd. of Equalization,
I. Facts and Proceedings
Taxpayer, Richard F. Sampson, owns a mobile home and the ten-acre parcel of real property on which it sits in Teller County, Colorado. The mobile home is a 1971 double-wide manufactured home consisting of approximately 1,104 square feet, three bedrooms, and one-and-one-half bathrooms. The home sits on a non-permanent cinder block foundation.
In August 2001, the Teller County Assessor’s office issued a Notice of Valuation for Sampson’s property indicating a market value of $93,951.00. Sampson did not protest this initial valuation.
After this notice was sent, there were additional mobile home sales in Teller County to provide further sales analyses in the valuation process of mobile home properties. On this basis, the Board of Equalization (“BOE”) ordered the Teller County Assessor (“assessor”) to perform new valuations for assessment of mobile homes. The assessor revalued Sampson’s mobile home and fixed the market value of Sampson’s property at $137,919.00.
Sampson protested this revised valuation to the BOE, which affirmed. Sampson then appealed to the BAA, challenging the BOE’s decision to uphold the revised valuation and seeking to reinstate the initial $93,951.00 valuation previously assigned to the property.
At the BAA hearing, Sampson appeared pro se via telephone conference call. Sampson maintained the property had been overvalued because the home does not have a permanent foundation and is located on a privately maintained road while the comparable sales used by the BOE were of newer mobile homes on permanent foundations located approximately 25 miles away. He did not, however, introduce evidence of comparable sales of property.
The BAA concluded Sampson “presented sufficient probative evidence and testimony to prove that the subject property was incorrectly valued for the tax year 2001.” It explained that: (1) There exists a basis for the differences in value for mobile homes situated on permanent foundations; mobile homes situated on permanent foundations can obtain favorable financing in the market place; (2) the comparable sales presented by the BOE did not accurately compare to Sampson’s property; (3) the BOE did not present evidence establishing that older mobile homes not situated on a permanent foundation, like Sampson’s, appreciated to the same level as the comparables it used; (4) it disagreed with the comparable sales and adjustment calculations presented by the BOE; and (5) the assessor’s office did not address all factors affecting the valuations for mobile homes of Sampson’s type in this area.
The BAA ordered the BOE to reduce the 2001 actual value of Sampson’s property to the amount of the initial valuation, $93,951.00, with $63,553.00 allocated to land and $30,398.00 allocated to improvements.
Teller County appealed. In a published opinion, the court of appeals reversed. The court of appeals noted that, although the BOE’s valuation was no longer presumptively correct in light of article X, section 20 of the Colorado Constitution, (the Taxpayer’s Bill of Rights, or “TABOR”), the taxpayer nevertheless had the burden of proof. The court of appeals held the taxpayer had the burden of proof in the BAA proceeding to establish an appropriate basis for an alternative reduced valuation of the subject property under the applicable statutory scheme. Sampson,
Applying this burden of proof, the court held the BAA erred in reducing the subject property’s valuation to $93,951.00. Id. Specifically, it concluded that, because the BAA rejected all valuation evidence presented, there existed no competent evidence to support the valuation and, accordingly, the taxpayer failed to meet his burden of providing an appropriate basis for a reduced valuation. Id.'
The BAA appealed. We granted certiorari to review the court of appeals’ holding.
II. Analysis
The parties do not dispute that a taxpayer challenging an assessment has the burden of
The BAA argues a taxpayer protesting an assessment in a BAA proceeding only has the burden to prove by a preponderance of the evidence that the assessment of the taxpayer’s property is incorrect and need not prove an alternative valuation. We agree.
We first review the statutory scheme regulating taxpayer proceedings and the valuation of mobile homes. We then turn to the taxpayer’s burden of proof and conclude a taxpayer must only prove, by a preponderance of the evidence, that an assessment is incorrect to prevail at a BAA proceeding. Finally, we determine that article X, section 20, of the Colorado Constitution does not affect this burden of proof.
A. Statutory Scheme
1. Taxpayer Protest Procedures
Article X, section 3(l)(a), of the Colorado Constitution requires that valuations for assessment be based on appraisals by assessing officers. See also § 39-5-104, C.R.S. (2004). Once the assessor determines the actual value of the property and issues a Notice of Valuation, a taxpayer has the right to protest the assessor’s valuation. § 39-5-122, C.R.S. (2004). If the assessor denies a taxpayer’s protest, the taxpayer may petition the county BOE. § 39-8-106, C.R.S. (2004).
The BOE hears and considers all testimony and exhibits produced by the parties “with no presumption in favor of any pending valuation.” See § 39-8-107(1), C.R.S. (2004). The BOE has the authority to “raise, lower, or adjust any valuation for assessment appearing in the assessment roll.” § 39-8-102(1), C.R.S. (2004); see Arapahoe County Bd. of Equalization v. Podoll,
The assessor must make available, at least two days prior to the hearing, all data used to support the assessor’s valuation on taxpayer request. See § 39-8-107(3), C.R.S. (2004); Russell,
A taxpayer dissatisfied with a BOE decision denying a petition in whole or in part may submit the case to arbitration, see 39-8-108.5, C.R.S. (2004), or appeal the valuation set by the assessor or the adjusted BOE valuation to either the BAA or the district court of the county for a trial de novo. See § 39-8-108(1), C.R.S. (2004). Both the taxpayer and the assessor are parties to the district court or BAA proceeding and have the right to present evidence. See § 39-8-107(1); Russell,
The BAA is comprised of three members. All members of the BAA must be experienced in property valuation and taxation and be registered, licensed, or certificated pursuant to sections 12-61-700 to -718, C.R.S. (2004), which govern real estate appraisers. § 39-2-123, C.R.S. (2004). Likewise, Rules 2.1 to 2.4, 4 C.C.R. 725-2 (2003), of the Rules of the Colorado Board of Real Estate Appraisers set forth the requirements for registration, licensure or certification as a real estate appraiser. These rules require real estate appraisal education programs emphasizing basic appraisal principles and procedures. See id. The education must cover a variety of topics, including legal considerations in appraisal, economic principles, real estate markets and analysis, the valuation process, property description, and the sales comparison approach. See id.
The BAA or district court can review the BOE’s decision de novo. Russell,
2. Valuation of Mobile Homes
A mobile, or “manufactured,” home is: “a preconstructed building unit ... without motive power designed and commonly used for residential occupancy by persons in either temporary or permanent locations.” § 38-29-103, C.R.S. (2004). Colorado’s General Assembly placed an ad valorem tax on mobile homes in response to the rapid evolution of mobile homes into residential housing of a substantially permanent and immobile nature. American Mobilehome Ass’n, Inc. v. Dolan,
Accordingly, mobile homes are treated as real property for tax purposes. Mobile homes can also be converted from personal property to real property for all purposes. Leader Fed. Bank for Sav. v. Saunders,
The Colorado Constitution, article X, section 3, sets forth the basic framework for ad valorem taxation of real and personal property and depends on a calculation of the “actual value” of the property to be taxed. Russell,
The actual value of all real ... property ... shall be determined under general laws, which shall prescribe such methods and regulations as shall secure just and equalized valuations for assessments ....
Colo. Const, art. X, § 3(l)(a).
“Actual value” is synonymous with market value. See City & County of Denver v. Bd. of Assessment Appeals,
Market value has been described as “what a willing buyer would pay a willing seller under normal economic conditions.” Bd. of Assessment Appeals v. Colo. Arlberg Club,
This language implies that compliance with these procedures and instructions is necessary to accomplish the state goal of achieving fair and uniform valuation for assessment of real property. See Colo. Const, art. X, § 3; cf. Resolution Trust Corp. v. Bd. of County Comm’rs,
We begin our discussion of the taxpayer’s burden of proof in a BAA proceeding with a review of case law stating that a taxpayer has the burden of proving that an assessment is incorrect. We then consider the historical origins of the burden of proof in the context of property taxation. Specifically, we consider the traditional presumption that an agency complies with its statutory mandate and this presumption’s relationship to the taxpayer’s burden of proof. We conclude the taxpayer’s burden of proof derives from this presumption and requires a taxpayer to demonstrate that an assessment is incorrect. We further conclude that article X, section 20, which eliminates the presumption favoring a pending valuation, is consistent with this burden of proof.
1. Case Law
A taxpayer’s burden of proof in a BAA proceeding is well-established: a protesting taxpayer must prove that the assessoi'’s valuation is incorrect by a preponderance of the evidence in a de novo BAA proceeding. We recently stated this burden of proof in Arapahoe County Board of Equalization v. Podoll,
Likewise, the court of appeals has consistently stated that the taxpayer’s burden of proof is to establish that the assessment is incorrect. Gyurman v. Weld County Bd. of Equalization,
Further, cases not explicitly stating the burden of proof have implicitly required the taxpayer to establish that the assessment is incorrect. In Majestic Great West Savings & Loan Ass’n v. Reale,
The burden of proving incorrectness corresponds to and derives from the historical presumption, which was rebuttable, that an assessor’s ascertainment of value for taxation was correct. See, e.g., Colo. & Utah Coal Co. v. Rorex,
As a general notion, a rebuttable presumption lends weight to particular inferences from a stated set of facts, but can be overcome by the party against whom the presumption operates. United Blood Serv. v. Quintana,
In all civil actions and proceedings not otherwise provided for by statute or by these rules, a presumption imposes upon the party against whom it is directed the burden of going forward with evidence to rebut or meet this presumption, but does not shift to such party the burden of proof in the sense of the risk of non-persuasion,which remains throughout the trial upon the party on whom it was originally cast.
A rebuttable presumption is different from a “burden of proof’ applicable to a claim in that the imposition of a presumption on an evidentiary point neither relieves a party nor imposes on a party the ultimate burden of proof. See CRE 301, cmt 1; see also City & County of Denver v. DeLong,
Under section 137-2-35, 6 C.R.S. (1963), the rebuttable presumption that an assessment was correct required a taxpayer to prove by clear and convincing evidence that an assessment was manifestly excessive, fraudulent, or oppressive. See § 137-2-35 (“the court shall not review, or give relief against an assessment ... unless it shall appear manifestly fraudulent, erroneous or oppressive”); Colo. & Utah Coal Co.,
In 1964, the General Assembly repealed section 137-2-35 and reenacted section 137-8-6, 6 C.R.S. (1963). Majestic Great W. Savings,
In Majestic Great West Savings, the court of appeals recognized that, while the taxpayer no longer had the burden of proving that an assessment was manifestly excessive, fraudulent, or oppressive, section 137-8-6 did not supply an alternative burden of proof. Id. However, there still existed a rebuttable presumption that the assessment was correct. Id.
In the absence of a statutorily-supplied burden of proof, Majestic suggested a burden of proof corresponding to the presumption that an assessment is correct. As noted above, the trial court found that clear and convincing evidence was the degree of proof to overcome the presumption that an assessment was correct. Majestic,
In 1971, the standard of proof changed from clear and convincing evidence to preponderance of the evidence pursuant to the enactment of section 52-1-128, 12 C.R.S. (1963) (recodified as section 13-25-127 in 1973). Thereafter, courts explicitly adopted the burden of proof implied in Majestic— that the taxpayer had the burden of proving the assessment was incorrect — but without explaining its relationship to the presumption. For example, the court in Honeywell Information Systems,
It is true that some courts have expressed that the burden of proof is to rebut the presumption of correctness: “[I]n a de novo hearing before the BAA, the burden of proof is on the taxpayer to rebut [the presumption that the valuation made by a county assessor is correct].” Snyder Family Trust,
Thus, the relevance of the presumption is limited to its historical relationship to the taxpayer’s burden of proof. That is, because these cases do not distinguish between the burden to overcome the presumption and the taxpayer’s burden of proof, the presumption’s relevance is limited to explaining the evolution of the burden of proof.
Notwithstanding the long line of cases establishing that the taxpayer has the burden of proving the assessment is incorrect, the BOE contends this burden is inconsistent with the statutory scheme governing property tax assessments. Specifically, the BOE argues that only establishing the assessment is incorrect stops short of establishing value, the goal of a BAA proceeding. Therefore, it maintains the court of appeals correctly concluded that a taxpayer must prove an appropriate basis for an alternative reduced valuation.
The court of appeals concluded the BAA’s reinstatement of the initial valuation was unsupported by competent evidence because the BAA was unable to reach an accurate valuation determination from the evidence presented. The court stated that the “taxpayer did not present any comparable sales evidence, and it ultimately discredited all the comparable sales evidence presented by the BOE. The BAA further ruled that it did not receive enough data from the parties to derive any accurate valuation.” Sampson,
The court of appeals’ resolution suggests the phrase “appropriate basis ... for an alternative reduced valuation” requires the taxpayer to present appropriate evidence of value sufficient to enable the BAA to determine the value of the subject property. Further, the BAA’s valuation must comply with the statute. See, e.g., Resolution Trust Corp.,
Case law, however, has not required the taxpayer to prove an alternative valuation that complies with statutory requirements. In Steamboat Ski & Resort Corp. v. Routt County Board of Equalization,
In addition, 501 South Cherry Joint Venture,
In this regard, a taxpayer is entitled to relief by demonstrating that the classification is incorrect. On this showing, the BAA has the authority to order reclassification, which ultimately requires reassessment by the county. See Gyurman,
Thus, relief is available regardless of whether the taxpayer provides an appropriate valuation so long as the taxpayer demonstrates that the assessment is incorrect.
To the extent the BOE also argues that the effect of article X, section 20 is to require the taxpayer to demonstrate an alternative valuation, we disagree. Article X, section 20 eliminates the presumption favoring a pending valuation in property tax appeals.
By eliminating the presumption of correctness, article X, section 20 attempts to’ put the taxpayer on equal footing with the county. Under the BOE’s approach, article X, section 20 would have the effect of changing the burden of proof from demonstrating incorrectness to demonstrating an alternative valuation, thereby imposing on the taxpayer a higher burden of proof. The taxpayer who demonstrated incorrectness but failed to produce an alternative valuation would be taxed based on the incorrect valuation as a result of the presumption’s elimination under article X, section 20. We discern no reason to interpret article X, section 20 as having the unintended effect of increasing the taxpayer’s burden of proof by requiring the taxpayer to demonstrate an alternative valuation. Rather, the elimination of the presumption comports with the rule that a taxpayer must demonstrate that an assessment is incorrect.
The taxpayer has long had the burden of disproving the assessment without the BOE introducing valuation evidence. In this regard, a taxpayer has always had the option of introducing a county’s assessment to provide the board with a context or to draw comparisons between the county’s assessment and the statutory requirements. As noted above, a taxpayer may request the assessor’s data. There is no reason this evidence could not be presented in taxpayer’s case-in-chief under the current statutory scheme. Further, the county’s assessment may be admitted into evidence somewhat informally, as it was in this ease, since it is known to all parties, readily available, and central to the hearing. Therefore, we do not agree with the BOE that the burden of proof announced here conflicts with appellate procedures generally.
Given our conclusion that the taxpayer’s burden is to prove incorrectness, we recognize that the objective of determining a property’s value will not always be accomplished at a BAA hearing. While the BAA members’ expertise enables them to determine from the evidence presented by the taxpayer whether the county’s valuation is incorrect, the taxpayer’s evidence may or may not be sufficient to further establish the subject property’s value for tax purposes. Thus, the BAA may properly remand the matter for an accurate assessment by the county, which is charged with the duty of assessing properties in accordance with the statutory mandate in the first instance. See 501 South Cherry Joint Venture,
While the burden of proving incorrectness may sometimes result in a hearing where value cannot be determined, the burden of proving incorrectness is consistent with and better serves state constitutional requirements. Although the narrow goal of the BAA proceeding is to value the subject property, the broader constitutional and statutory goal is to assess property at its “actual value” and to promote the principle of “equalized” value. Permitting a demonstrably incorrect assessment to stand merely because a value could not be determined at the BAA proceeding would be entirely contrary to the broader constitutional goal of deteimining actual value and promoting equalized value. It is for this very reason that remand to the BAA or BOE may be appropriate where necessary to determine an accurate value.
Hence, consistent with our case law, a taxpayer who meets the burden of demonstrating that an assessment is incorrect need not also show an alternative valuation under the market approach to prevail. Thus, we conclude a protesting taxpayer may prevail at a de novo BAA proceeding by demonstrating that an assessment is incorrect.
Accordingly, we hold the court of appeals erred in deteimining that a taxpayer in a BAA proceeding must demonstrate an alternative, reduced valuation of actual value under the market approach.
2. Valuation of Sampson’s Property
We review BAA decisions under the Administrative Procedure Act, section 24-4-106(11). See § 39-8-108(2), C.R.S. (2004); Colo. Arlberg Club,
There is sufficient evidence to support the BAA’s conclusion that Sampson satisfied his burden of proving the assessment was “incorrect.” See Steamboat Ski & Resort Corp.,
The BAA specifically found, with record support, that the assessor did not use appropriate comparable sales. Sampson’s home is located on a privately maintained road while the comparable sales used by the BOE were newer and approximately 25 miles away. In
The BAA also found that Sampson did not present comparable sales to support an alternative evaluation. It concluded that any adjustment made to the BOE’s sales for factors affecting the value would be inaccurate. As a result, it was presented with insufficient data to derive adjustment calculations. Therefore, the BAA used the initial valuation of the assessor, which was not contested by Sampson.
Where the taxpayer satisfies his burden of proving the assessment incorrect, but does not present an alternative evaluation, the proper remedy is to remand for a new assessment. See 501 South Cherry Joint Venture,
III. Conclusion
Accordingly, we reverse the judgment of the court of appeals and remand with directions to conduct further proceedings consistent with this opinion.
Notes
. In Podoll, we stated that the "assessor's ascertainment of the value of property for taxation is presumed to be correct.”