Gateway Pines Hahira, LP v. Lowndes Cnty. Board of Tax Assessors, 372 Ga.App. 705 (Ga.App., 2024)
Gateway Pines Hahira, LP (“Gateway Pines”) appeals from the superior court’s order granting partial summary judgment to the Lowndes County Board of Tax Assessors (“the Board”) in this dispute concerning the ad valorem tax assessment of a rent-restricted apartment complex. On appeal, Gateway Pines argues that the trial court erred by holding that (1) excluding certain tax credits from the fair market value of the property at issue would violate the uniformity provisions of the Georgia Constitution; (2) the income approach to valuation is inapplicable and may not be used to value the property; and (3) the tax credits should not be excluded when using the cost approach or considering unusual circumstances. For the reasons that follow, we affirm.
[. . .]
The trial court’s ruling that excluding Section 42 tax credits from the fair market value of Section 42 properties would be a violation of the taxation uniformity provision is consistent with the Supreme Court’s holding in Heron One and the Supreme Court’s explanation of that holding in Heron Two. . . . Excluding Section 42 tax credits from the assessment of fair market value would be inconsistent with the statutory definition of fair market value and would grant preferential treatment for ad valorem taxation purposes. . . . Thus, the trial court did not err in holding that excluding Section 42 tax credits from the fair market value of Section 42 properties would violate the taxation uniformity provision.
[. . .]
Gateway Pines argues that under OCGA § 48-5-2 (3), assessors are required to consider the income approach in determining the fair market value of income-producing Section 42 properties. However, the Supreme Court limited the applicability of the income approach in determining the fair market value of Section 42 properties despite being fully aware of OCGA § 48-5-2 (3). See Heron Two, 306 Ga. at 824 (4), n. 7, 833 S.E.2d 528 (“OCGA § 48-5-2 (3) defines the ‘fair market value of property’ as ‘the amount a knowledgeable buyer would pay for the property and a willing seller would accept for the property at an arm’s length, bona fide sale,’ and says that ‘[t]he income approach, if data are available, shall be utilized in determining the fair market value of income producing property ….’ ”). Thus, the trial court did not err by finding that “the income approach is inapplicable and may not be used based on the current structure of the tax credits which does not provide any actual income to the taxpayer.”
[. . .]
Consequently, the trial court did not err in holding that Section 42 tax credits should not be excluded when using the cost approach or when unusual circumstances are considered.
