School, town to share expense of suit
In a move to protect their common interest of tax revenue, the town and school district have agreed to share the cost of defending a suit brought by an area nursing home.
Capital Living also known as Hallmark Nursing, owners of The Orchard Nursing and Rehabitation Centre in North Granville, is seeking a reduction of its assessed valuation to $900,000 from $3.52 million.
The loss of taxable income would affect both the town and the school district, leading the two sides to share the cost of fighting the proceeding.
Owners of The Orchard are seeking a reduction from its assessed valuation, Granville Sole Assessor Dan Boone said, using the same law firm used by plastics manufacturer St. Gobain. St. Gobain successfully sued to reduce its assessment, but exempted the school from paying back any monies owed for overpayment. Boone said the law firm of Jerrold F. Janata and Associates specializes in this type of case and offers to take on the suit for a percentage of the settlement value.
The current assessed value was placed on the nursing home during the 2005 revaluation and was what he considered “low, ballpark” for similar types of properties in Washington County, Boone said.
“The school district will be providing half of the cost of the legal defense of this suit,” Granville Supervisor Rodger Hurley said.
The supervisor said he did not know exactly how long the procedure would take but expected it to be resolved within the year and in the town’s favor.
When asked how much a reduction of the assessment of the property could cost the town and school district Hurley said the ongoing litigation prevented him from commenting.
“I can’t talk about that because we’re involved in a legal matter that is ongoing,” he said.
Rounding the assessed value of the Orchard to $3.5 million and using $1 million as an example of a potential reduced assessment value, the tax impact could be substantial to the town and school. In 2006, for example, the first year Capital Living contests, with a town tax rate of $6.17 per thousand, The Orchard approximately paid the town $21,595 in taxes. With the reduced assessment, that amount would drop by $15,425 to $6,170.
Capital Living contests 2006-2009 in the suit, which means, if they are successful, the Orchard would receive thousands in overpaid taxes.
“I’m confident that we will win this (suit) because I’m confident that our assessment of the property is fair, accurate and reasonable when compared with other such properties in similar circumstances,” Hurley said. “I’m confident that when they resolve this issue it will be in favor of the Granville community.”
“I would echo (Supervisor Hurley’s) thoughts. I’m not allowed to discuss ongoing litigation,” Superintendent Dan Teplesky said. He said the agreement between the two looked out for the interests of both groups.
“It’s a partnership with the Town of Granville,” Teplesky said.
On April 6 the Granville Board of Education signed an agreement to share the cost of defending the lawsuit with the town; the measure passed the board unanimously.
Town officials formally agreed to join the effort April 9 at the regular meeting of the town board.
Despite being down two members due to illness and prior commitments the town board also unanimously passed the measure.
Town attorney Mike Catalfimo said he thought the cost of defending the suit could be as much as $10,000 with each body agreeing to pay half.
Half of the town’s portion was due, he said, and the town agreed to pay $2,500 towards the effort. Catalfimo and school district attorney Monica Duffy are working jointly on The Orchard litigation. He told the board the litigation “was proceeding about like you’d expect it to” but said there was no major progress to report.
A portion of the cost of the defense of the suit results from the need to bring in a professional commercial real estate appraiser, Boone said. The appraiser will study the problem and provide the town and school district with their own conclusion for a fair market price for the property.
Boone said the town had known for “about a year” that the company intended to contest its assessment because they had to notify the grievance board before the grievance deadline. Boone said the grievance board denies claims from commercial sources automatically and passes the matter on to the town’s attorney.
At press time Capital Living had not returned calls from The Granville Sentinel seeking comment on the matter.