In the case of Columbus City Schs. Bd. of Edn. v. Franklin County Bd. of Revision, 10th Dist. Franklin Nos. 19AP-204, 19AP-206, 19AP- 207, 19AP-208, 19Ap-209, 19AP-210, 19AP-211, 19AP-212, 2020-Ohio-200, an Ohio appellate court held that, when using the sale price of an arm’s length transaction to determine the value of property, the Board of Tax Appeals (“BTA”) is required to consider the creditworthiness of the buyer and, if applicable, the nature of the lease in a sale/leaseback transaction.
In this case, the BTA used the most recent sale price of an arm’s length transaction of a piece of property to determine the property’s value because the BTA held that it could not determine whether the lease price was above market rents. Parties negatively affected by this determination appealed the matter and argued that, under R.C. 5713.03, the BTA was required to consider factors other than the price of the most recent arm’s length transaction when determining a property’s value.
The Ohio appellate court held that the creditworthiness of a buyer in an arm’s length transaction and the nature of a sale/leaseback transaction, if applicable, could affect a sale price as to make it different than market value; thus, the BTA was required to consider such factors when using the sale price of an arm’s length transaction to determine a property’s true value.
To read this case, click here.
Authors: Matthew John Markling and the McGown & Markling Team.
Note: This blog entry does not constitute – nor does it contain – legal advice. Legal jurisprudence is like the always changing like the Midwestern weather. As a result, this single blog entry cannot substitute for consultation with a McGown & Markling attorney. If legal advice is needed with respect to a specific factual situation, please feel free to contact a McGown & Markling attorney.