The Santa Ynez Band of Chumash Indians is seeking to recover $175,000 in property taxes it overpaid to Santa Barbara County originating from an erroneous 2015 assessment of its Camp 4 property, according to a lawsuit that now has gone to trial.
The higher tax bill stemmed from the appraisal of the 1,400-acre piece of land, leading the tribe to apply for a refund and reduction in the property’s value, which the County Assessment Appeals Board denied in 2018.
As a result, the tribe accused the Appeals Board of arbitrarily denying its application and accused the Assessor Division of taking advantage of the tribe and failing to properly investigate Camp 4’s sale in 2010, which the plaintiffs contend was not a fair market sale, according to the lawsuit filed in Superior Court on Oct. 31, 2018.
In addition to recovering property taxes, the tribe is seeking interest and costs related to the refund, along with attorneys fees.
The final word on the federal government taking a large parcel of land into trust for the Santa Ynez Band of Chumash Indians, was made last week by the assistant secretary of Indian affairs and published Wednesday in the Federal Register.
The trial, which is expected to last three days, is being held virtually due to the COVID-19 pandemic and the case will be decided by Judge Jed Beebe. It's an administrative appeal, which means the trial is only heard by a judge, according to Chumash attorney Richard Wideman.
County counsel, which represents the Appeals Board in the lawsuit, declined to comment. The Chumash did not respond to an email seeking comment.
“The Assessor’s complete failure to investigate the circumstances of the property's sales transaction violates applicable appraisal standards and ethics, including but not limited to the duty to confirm the details of the sales transactions, especially considering the prior sale of the property that is being appraised,” according to the lawsuit.
Camp 4 was purchased by the tribe from the Parker family, of Fess Parker fame, for a price of $40 million in 2010.
Derek Wiggam, the assessor’s only appraisal witness on the property, valued Camp 4 at a fair market value of $37 million, according to the lawsuit.
The Chumash contend that the fair market value was $21 million and, after adjustments, the assessed value was just over $18 million in 2015, according to Donald Bratt, an independent appraiser hired by the tribe.
Fess Parker purchased the property for $6 million in 1999, which was not considered in the appraisal, according to the lawsuit.
During the 2018 assessment appeal hearing, former Chumash chairman Vincent Armenta who negotiated with Eli Parker on the sale, testified that the price had nothing to do with the appraised value and that the Parkers took advantage of the tribe's immediate need to find land for housing.
"Owners of nearby properties were unwilling to sell their properties to plaintiff due to the negative feelings in the community towards the tribe," according to the lawsuit.
Wiggam was accused of using improper appraisal methods, including using newspaper articles verifying the transaction and making "faulty and speculative" assumptions of a possible subdivision.
Assessor Division employees cannot comment on pending litigation, according to spokesman Anthony Luis.
“It is not possible to assess the parties’ motivations in a real estate transaction unless the parties are interviewed and independent evidence [is] obtained,” according to the lawsuit. “Newspaper articles are hearsay and cannot be relied upon to support an opinion of value.”
During the second day of trial Tuesday, independent appraiser Allison Moore testified that contacting parties directly to find out what they intend to do with the property is helpful in determining its value.
“Not attempting to talk to as many parties, given the complexity (of the sale), is not the proper method,” said Moore, while acknowledging that sometimes parties can’t be reached. “I can always find a way around that. It just makes me work harder."
Moore testified that other factors influence price, such as whether the sale was made under duress or if it was made on the open market.
The Chumash claim it was not an open market transaction because it was purchased for the tribe's "unique and specialized" needs, which couldn't pertain to anyone else, according to the lawsuit.
Additionally, the land must be valued based on county zoning regulations, which prohibit housing on Camp 4, although the Chumash are permitted to build because they are a federally recognized tribe. Camp 4 is now in federal fee-to-trust, effectively preventing the county from collecting taxes on the property.
"The assessor in fact did impermissibly capture value specific to plaintiff by using the 2010 sale of the property to plaintiff to justify his inflated opinion of value, and by considering the plaintiff's unique development plans not available to any member of the public," the lawsuit said. "The assessor obviously took the tribe's development plans into account."
The trial resumes for its third and likely final day at 9:30 a.m. on Oct. 19 in Department 4 of Santa Maria court.
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