Village at Main Street Phase II, LLC v. Department of Revenue

164 September 18, 2014 No. 61

IN THE SUPREME COURT OF THE

STATE OF OREGON

VILLAGE AT MAIN STREET PHASE II, LLC,

Respondent,

v.

DEPARTMENT OF REVENUE,

State of Oregon;

and Clackamas County Assessor,

Appellants.

(TC 5054; SC S061133 (Control))

VILLAGE AT MAIN STREET PHASE III, LLC,

Respondent,

v.

DEPARTMENT OF REVENUE,

State of Oregon;

and Clackamas County Assessor,

Appellants.

(TC 5055; SC S061137)

VILLAGE RESIDENTIAL, LLC,

Respondent,

v.

DEPARTMENT OF REVENUE,

State of Oregon;

and Clackamas County Assessor,

Appellants.

(TC 5056; SC S061138)

VILLAGE RESIDENTIAL, LLC,

Respondent,

v.

DEPARTMENT OF REVENUE,

State of Oregon;

and Clackamas County Assessor,

Appellants.

(TC 5057; SC S061139)

Cite as 356 Or 164 (2014) 165

En Banc

On appeal from the Oregon Tax Court.*

Argued and submitted January 16, 2014.

Carolyn Alexander, Senior Assistant Attorney General,

argued the cause and filed the brief for appellant Department

of Revenue. With her on the brief were Ellen F. Rosenblum,

Attorney General, and Anna Joyce, Solicitor General.

Kathleen J. Rastetter, Senior Assistant County Counsel,

filed the briefs for appellant Clackamas County Assessor.

With her on the briefs was Stephen L. Madkour, Clackamas

County Counsel.

Donald H. Grim, Greene & Markley, PC, Portland,

argued the cause and filed the brief for respondents on

review.

LANDAU, J.

The limited judgments of the Tax Court are reversed,

and the cases are remanded to the Tax Court for further

proceedings.

In four property tax appeals, taxpayers had challenged only the value of

the improvements to the property. While those matters were on appeal to the

Magistrate Division of the Tax Court, the legislature enacted ORS 305.287,

which allows the other parties to an “appeal” to seek a determination of the value

of other components of the property. In taxpayers’ subsequent appeals to the

Regular Division of the Tax Court, the Department of Revenue and the Clackamas

County Assessor invoked ORS 305.287 and attempted to challenge the value of

the land. The Regular Division of the Tax Court rejected the argument, holding

that ORS 305.287 applied only to proceedings before the Magistrate Division.

The department and the assessor appealed. Held: (1) ORS 305.287, which refers

to “appeals” to a “body or tribunal,” permits a party to raise new issues not just

before the Magistrate Division, but also before a county board of property tax

appeals and before the Regular Division of the Tax Court; and (2) because ORS

305.287 became effective before taxpayers filed their appeals to the Regular

Division in this case, it was not retroactive to apply that statute to these appeals

to the Regular Division.

The limited judgment of the Tax Court is reversed, and the cases are

remanded to the Tax Court for further proceedings.

______________

*  Appeals from the Oregon Tax Court, Henry C. Breithaupt, Judge, 20 OTR

524 (2012)

166 Village at Main Street Phase II v. Dept. of Rev.

LANDAU, J.

In these consolidated property tax appeals, tax-

payers challenged the valuation of their real property by

the Clackamas County Assessor. In their appeals to the

Magistrate Division of the Tax Court, they challenged only

the valuation of the improvements on their land, not the val-

uation of the land itself. The Magistrate Division affirmed.

Taxpayers then appealed to the Regular Division of the

Tax Court, again challenging only the valuation of their

improvements. In the meantime, however, the legislature

had enacted ORS 305.287. Under that new statute, even if a

taxpayer challenges only one aspect of a property tax assess-

ment, any other party to an “appeal” may challenge other

aspects of the assessment as well. Relying on that stat-

ute, the county asserted for the first time before the Regular

Division of the Tax Court that it had erroneously under-

valued taxpayers’ land. The Tax Court concluded, however,

that challenges before the Regular Division are not “appeals”

for the purposes of that statute. Village at Main Street Phase

II v. Dept. of Rev., 20 OTR 524 (2012). As a result, the court

ruled that the county could not challenge the valuation of

taxpayers’ land. The issue before us now is whether the Tax

Court correctly concluded that ORS 305.287 does not apply

to appeals to the Regular Division of the Tax Court. For the

reasons that follow, we conclude that the Tax Court erred in

ruling that the statute does not apply and that the county

may not challenge its own land valuations.

I. BACKGROUND

To provide context for the parties’ dispute about

the meaning of ORS 305.287, we begin with an overview of

the property tax appeal process, followed by a brief descrip-

tion of the relevant facts and a summary of the Tax Court’s

decision.

A.  The Property Tax Appeal Process

In Oregon, property taxes are assessed for, among

other things, real property, including any improvements on

that real property. The taxes—referred to as “ad valorem”

taxes—are based on the value of the property and improve-

ments. The state’s property tax system largely relies on

Cite as 356 Or 164 (2014) 167

county tax assessors to value property subject to taxation,

calculate the tax, collect the tax, and distribute the revenue

to taxing districts. By law, the county assessor is required

to value the land and any improvements separately. ORS

308.215(1)(a)(E), (F) (as renumbered by the legislature in

2012; Or Laws 2012, ch 30, § 1).

A taxpayer who is dissatisfied with the county asses-

sor’s valuation may appeal the assessor’s decision through

four successive levels of review, each of which the statutes

refer to as an “appeal.”

The first level of review is (in most cases) before a

county board of property tax appeals (BOPTA). See ORS

309.100 (authorizing taxpayers to appeal to BOPTA); ORS

305.275(3) (party cannot appeal to Tax Court if party can

appeal to a BOPTA).1 The relevant statutes refer to review

by the county BOPTA as an “appeal.” See ORS 305.275(3)

(appeal to Magistrate Division is not allowed “[i]f a taxpayer

may appeal to the board of property tax appeals”). Indeed,

the name of the reviewing tribunal is the “board of property

tax appeals.” ORS 309.020(1)(a) (emphasis added).

A party dissatisfied with a decision of a county

BOPTA may seek review by the Tax Court. ORS 305.275(3).

The Tax Court, however, consists of two separate divisions:

the Magistrate Division and the Regular Division. See ORS

305.404 (reference to “Tax Court” in statutes “may include

either the regular division or the magistrate division of the

Oregon Tax Court, or both, or the judge or judges of the

[T]ax [C]ourt or its magistrates or a combination”); ORS

305.498(1) (“The magistrate division is established in the

Oregon Tax Court.”); Dept. of Rev. v. Froman, 14 OTR 543,

546 (1999) (“The Oregon Tax Court is one court with two

divisions.”).

The Magistrate Division is not a court of record;

proceedings before it are informal and are not subject to

the rules of evidence. See ORS 305.430(1) (“Proceedings

before the magistrate division shall not be reported.”); ORS

1

Not all property tax appeals go to a BOPTA. A taxpayer dissatisfied with

the assessment of primary or secondary industrial property may appeal directly

to the Tax Court. ORS 305.403; see ORS 309.100 (right to appeal to BOPTA does

not include appeals governed by ORS 305.403).

168 Village at Main Street Phase II v. Dept. of Rev.

305.501(4)(a) (subject to Tax Court rules, magistrate “is not

bound by common law or statutory rules of evidence or by

technical or formal rules of procedure,” but “may conduct

the hearing in any manner that will achieve substantial jus-

tice”); see also Froman, 14 OTR at 546-47 (“The Magistrate

Division is intended by the legislature to be informal and

user friendly.”).

The Regular Division, in contrast, is a court of record

with general jurisdiction. ORS 305.405(1). It has the same

powers as a circuit court. ORS 305.405(2), (3). Proceedings

before the Regular Division are “original, independent pro-

ceedings” that are “tried * * * de novo.” ORS 305.425(1). The

Regular Division is to “consider all properly admitted evi-

dence and reach its own independent conclusions” in any

given case. Reed v. Dept. of Rev., 310 Or 260, 265, 798 P2d

235 (1990).

Ordinarily, a party seeking review of a county

BOPTA decision must first appeal to the Magistrate Division.

ORS 305.501(1).2 The relevant statutes refer to review of a

BOPTA decision by the Magistrate Division as an “appeal.”

ORS 305.275(1), (3) (authorizing “appeal *  * to the mag-

*

istrate division of the Oregon Tax Court”). When a tax-

payer appeals a property tax assessment to the Magistrate

Division, the Department of Revenue is substituted for the

county assessor as a party. ORS 305.501(1).

A party dissatisfied with the decision of the Mag-

istrate Division may then seek review, de novo, by filing a

complaint in the Regular Division. ORS 305.501(5)(a) (party

who is “dissatisfied with a written decision of a magistrate

may appeal the decision to the judge of the [T]ax [C]ourt”).

The relevant statutes refer to that review, too, as an “appeal.”

Id.

The fourth and final level of review is before the

Supreme Court. ORS 305.445. On review before this court,

2

A case may be specially designated to proceed directly to the Regular Divi-

sion, either by rule or by court order. See ORS 305.501(1) (subject to an exception

involving mediation, “an appeal to the [T]ax Court shall be heard by a [T]ax

[C]ourt magistrate unless specially designated by the [T]ax [C]ourt judge for

hearing in the regular division”); TCR 1 C (detailing permissible types of special

designations).

Cite as 356 Or 164 (2014) 169

the court can review only for errors of law and for the

absence of substantial evidence in the record to support the

Tax Court’s decision. Id. The relevant statutes also describe

that final review as an “appeal.” Id. (“exclusive remedy for

review” of decision of Tax Court “shall be by appeal to the

Supreme Court”).

B.  The Nepom Rule, Ballot Measure 50, and ORS 305.287

Because an assessment entails separate valuation

of both the land and the improvements, a taxpayer seeking

review of an assessment is entitled to challenge the valua-

tion of either of those components, or both of them. In Nepom

v. Dept. of Rev., 272 Or 249, 256, 536 P2d 496 (1975), this

court held that, if a taxpayer challenged the valuation of

only one component—either the land or the improvements—

the sole issue before the reviewing body was the valuation of

that component. Thus, for example, if a taxpayer challenged

the value of the improvements, arguing that they were too

high, the county assessor could not seek to offset any drop

in that valuation by showing that the land had been valued

too low. See id. (“We conclude that plaintiff was entitled to

challenge only the value of the improvements * * *; however,

as the value of the land was not an issue in the case, the

Tax Court acted improperly in adding the reduction in the

improvement values to the land.”).

Under the law in effect at the time, Nepom had lim-

ited practical effect. If a taxpayer challenged only one compo-

nent of a real property assessment, and if the county asses-

sor believed that the other component had been assessed

in error, the assessor could adjust the value of that other

component the following year. In 1997, however, the voters

approved Ballot Measure 50, which amended the Oregon

Constitution, creating a new provision, Article XI, section 11.

Among many other things, Measure 50 and its

implementing statutes reduced the assessed value of prop-

erty to 10 percent below 1995 values. Or Const, Art XI,

§ 11(1)(a). For future years, the value of property for tax

purposes cannot exceed three percent more than what it

was in the preceding year. Or Const, Art XI, § 11(1)(b); ORS

308.146(2). The combined effect of Nepom and Measure

50 was to curb the assessor’s ability to adjust any error in

170 Village at Main Street Phase II v. Dept. of Rev.

valuation of any assessment components that a taxpayer

elected not to challenge. See generally Flavorland Foods v.

Washington County Assessor, 334 Or 562, 565, 54 P3d 582

(2002) (summarizing effects of Measure 50).

In 2011, the legislature enacted ORS 305.287 to

address that combined effect of Nepom and Measure 50.

That statute provides:

“Whenever a party appeals the real market value of one

or more components of a property tax account, any other

party to the appeal may seek a determination from the

body or tribunal of the total real market value of the prop-

erty tax account, the real market value of any or all of the

other components of the account, or both.”

The legislature provided that the new statute took effect

“on the 91st day after the date on which the 2011 session of

the Seventy-sixth Legislative Assembly adjourns sine die.”

Or Laws 2011, ch 397, § 3. That led to an effective date of

September 29, 2011.

C.  Facts

With that background, we turn to the undisputed

facts. The taxpayers in this case are Village at Main Street

Phase II, LLC; Village at Main Street Phase III, LLC; and

Village Residential, LLC. They own apartment rental proper-

ties in Clackamas County. The Clackamas County Assessor

assessed those properties for property tax purposes.

Taxpayers disagreed with the 2006, 2007, and 2008

real market values of two tax lots, and the 2007 and 2008

real market values of one additional tax lot. Accordingly,

taxpayers appealed the assessor’s assessments to the county

BOPTA. The county BOPTA affirmed.

Taxpayers then appealed the BOPTA’s decision to

the Magistrate Division of the Tax Court. They challenged

only the valuation of the improvements, not the land. At the

time, the Nepom rule applied, so the sole issue before the

Magistrate Division was the valuation of the improvements.

While taxpayers’ appeal was still pending in the Magistrate

Division, however, the legislature enacted ORS 305.287.

The Magistrate Division rendered its decisions in

these appeals on December 13, 2011. Taxpayers, dissatisfied

Cite as 356 Or 164 (2014) 171

with the result, then appealed to the Regular Division of the

Tax Court. They did so by filing four separate complaints—

one challenging the valuation of improvements owned by

Village at Main Street Phase II, a second challenging the

valuation of improvements owned by Village at Main Street

Phase III, and the remaining two challenging the valuation

of improvements on two different tax lots owned by Village

Residential. None of the four complaints challenged the val-

uation of taxpayers’ land. The Department of Revenue filed

answers, and the county assessor intervened in all four cases.

The assessor, however, had come to believe that it

had undervalued taxpayers’ land. Believing that the newly

enacted ORS 305.287 authorized it to raise the issue, the

assessor moved for preliminary rulings in all four cases,

contending that taxpayers’ appeal to the Regular Division

constituted an “appeal” under ORS 305.287 that would

allow the assessor to correct the land valuations. Taxpayers

countered with motions seeking preliminary rulings that

ORS 305.287 did not apply.

D.  The Tax Court Decision

The Tax Court rejected the assessor’s arguments

and granted taxpayers’ motions for a preliminary ruling.

Village at Main Street, 20 OTR 524. The Tax Court acknowl-

edged that ORS 305.287 applies “whenever a party appeals”

one or more components of a property tax assessment and

that the relevant statutes refer to each of the four levels of

review of such an assessment as “appeals.” The court never-

theless concluded that the statute applies to only one of those

four levels of review, namely, appeals to the Magistrate

Division of the Tax Court. The court concluded that, based

on various contextual indicia of legislative intent, ORS

305.287 does not apply to appeals to a county BOPTA, the

Regular Division of the Tax Court, or the Oregon Supreme

Court.

Beginning with appeals to a county BOPTA, the

Tax Court noted that, under existing statutes, “[t]he appeal-

ing party can only be the taxpayer.” 20 OTR at 529. Because

“[t]he appeal referred to in ORS 305.287 is one that may be

made or taken by either party to a property tax dispute,” the

172 Village at Main Street Phase II v. Dept. of Rev.

court concluded, the statute must be understood not to apply

to appeals to a BOPTA. 20 OTR at 530.

In contrast, the Tax Court found no conflict between

ORS 305.287 and review by the Magistrate Division. Indeed,

the court observed, under Department of Revenue rules,

OAR 150-309.110(1), the county BOPTA order appealed to

the Magistrate Division must separately state the values of

each component of the property tax account, regardless of

whether the taxpayer challenged both components.

As for review of an assessment by the Regular

Division, the Tax Court concluded that its own review mech-

anisms and ORS 305.287 do conflict. The court acknowl-

edged that appeals to the Regular Division are described

in the statutes as “original,” “independent,” and “de novo.”

But it then observed that “nothing in the statutes prior to

the addition of ORS 305.287 suggested that if a claim for

relief had not been made for a component of an account to

the Magistrate Division[,] such a claim could be made for

the first time to the Regular Division.” 20 OTR at 530. To

the contrary, the Tax Court noted, ORS 305.501(1) pro-

vides that, ordinarily, tax appeals should first go to the

Magistrate Division before being directed at the Regular

Division. Accordingly, the Tax Court concluded, “[t]he

mechanisms of the Regular Division and ORS 305.287 do

not fit together well.” 20 OTR at 530. The Tax Court fur-

ther noted that the statutory time frames for filing appeals

also do not fit well with the application of ORS 305.287 to

the Regular Division. According to the Tax Court, because

ORS 305.280(4) gives only 30 days for a party to appeal a

decision from a county BOPTA, applying ORS 305.287 to

the Regular Division would, in effect, authorize parties to

appeal beyond that statutory deadline. See 20 OTR at 533.

Turning to review by the Oregon Supreme Court,

the Tax Court noted that pertinent statutes define such

review as very limited in scope, extending only to errors

of law or the absence of substantial evidence to support

findings of fact made by the Tax Court. Applying of ORS

305.287 to Supreme Court review, the court said, “would

cause serious statutory conflicts,” because it would require

the Supreme Court to make factual determinations not

Cite as 356 Or 164 (2014) 173

previously determined by the Tax Court, contrary to the

Supreme Court’s limited review authority. 20 OTR at 530-31.

After thus concluding that ORS 305.287 applies

only to appeals to the Magistrate Division, the Tax Court

observed that the statute did not become effective until

after taxpayers sought review at that level in this case. The

court then posed the question whether ORS 305.287 never-

theless applied retroactively to taxpayers’ appeal to the

Magistrate Division. The court summarily concluded that,

in the absence of any wording in ORS 305.287 suggesting

that it applies retroactively, the statute does not apply to

these proceedings at all. 20 OTR at 534-35.

After the Tax Court entered its order granting tax-

payers’ motions for a preliminary ruling, the assessor again

raised the ORS 305.287 issue by moving to file amended

answers and counterclaims. The court entered limited judg-

ments denying the assessor leave to file amended answers

and counterclaims. These appeals followed. See ORS 305.445

(appeal to Supreme Court is “sole and exclusive remedy” for

review of Tax Court decision).

II. ANALYSIS

On appeal, the department and the assessor con-

tend that the Tax Court erred in concluding that ORS

305.287 applies only to proceedings before the Magistrate

Division. According to the department and the assessor, the

statute applies to all levels of review, save review by this

court. Taxpayers maintain that the Tax Court correctly con-

cluded that ORS 305.287 applied only to Magistrate Division

appeals. In the alternative, taxpayers contend that, even

assuming that the statute applies to appeals to the Regular

Division, it does not apply in this particular case, because

there is no indication that the legislature intended the stat-

ute to apply retroactively.

A.  Whether ORS 305.287 Applies Only to Appeals to the

Magistrate Division

The parties’ contentions require us to construe

ORS 305.287. In performing that task, we are guided by

the interpretive principles of PGE v. Bureau of Labor and

174 Village at Main Street Phase II v. Dept. of Rev.

Industries, 317 Or 606, 610-12, 859 P2d 1143 (1993), and

State v. Gaines, 346 Or 160, 171, 206 P3d 1042 (2009). That

is, we seek to determine the meaning of the statute that the

legislature most likely intended by examining the text in

context, any relevant legislative history, and, if necessary,

pertinent canons of construction. Id. at 171-72.

We begin with the text. For convenience, we repeat

it here:

“Whenever a party appeals the real market value of one

or more components of a property tax account, any other

party to the appeal may seek a determination from the

body or tribunal of the total real market value of the prop-

erty tax account, the real market value of any or all of the

other components of the account, or both.”

ORS 305.287. For at least three reasons, that wording

strongly suggests that the legislature had in mind more

than one level of appeal.

First, ORS 305.287 states that it applies “whenever”

a party appeals. As used in that statute, the word functions

as a subordinating conjunction, which introduces the depen-

dent clause that begins the sentence and connects it to the

balance. See generally Fowler’s Modern English Usage 171

(3d ed 1996) (explaining subordinating conjunctions). Used

in that sense, “whenever” ordinarily means “at any or all

times that : in any or every instance in which.” Webster’s

Third New Int’l Dictionary 2602 (unabridged ed 2002); see

also American Heritage Dictionary of the English Language

1971 (5th ed 2011) (“at whatever time that : * * * every time

that”).3 Thus, the ordinary meaning of the statutory term

contemplates more than one instance in which a relevant

event—in this case, an appeal—occurs.

Second, the statute refers broadly to an “appeal” of

an assessment. As we have noted, the relevant statutes set-

ting out the four levels of review of a property tax assessment

3

The Tax Court observed that the word “whenever” has a more limited

meaning when used as an adverb. See Webster’s at 2602 (defining adverb “when-

ever” as “at whatever time : no matter when”). But, as we have noted, in ORS

305.287, the word does not function as an adverb. And, in any event, it is not so

clear to us that the definition of the adverb is quite as limited as the Tax Court

suggested. “[A]t whatever time” and “no matter when” do not necessarily imply

only a single event.

Cite as 356 Or 164 (2014) 175

refer to each of those four levels as “appeals.” Under the cir-

cumstances, the general assumption of consistency counsels

us to assume that the legislature intended the same word to

have the same meaning throughout related statutes unless

something in the text or context of the statute suggests a

contrary intention. See, e.g., State v. Cloutier, 351 Or 68, 99,

261 P3d 1234 (2011) (“[I]n the absence of evidence to the

contrary, we ordinarily assume that the legislature uses

terms in related statutes consistently.”). There may well be

indications in related statutes suggesting that the legisla-

ture did not intend ORS 305.287 to apply to all four levels

of appeal. Still, nothing in the text of that statute itself sug-

gests that it applies to only one such level.

Third, ORS 305.287 refers to appeals to a “body or

tribunal,” suggesting that the legislature understood it to

apply to more than one level of appeal and to different types

of appellate entities. Indeed, if the legislature had intended

to limit the application of ORS 305.287 to a single entity,

the broad phrasing of the statute in terms of an appeal to

a “body or tribunal” would serve no apparent purpose. See

Crystal Communications, Inc. v. Dept. of Rev., 353 Or 300,

311, 297 P3d 1256 (2013) (“As a general rule, we construe

a statute in a manner that gives effect, if possible, to all its

provisions.”).

On the face of the statute, then, ORS 305.287 would

appear to apply to any property tax appeal. Nothing in its

wording suggests that it is limited to one level of appeal.

The legislative history of ORS 305.287 on the issue

is sketchy, but pertinent portions appear to confirm our

reading of the statute. During the floor debate on the bill

that became ORS 305.287, Representative Barnhart—the

carrier of the bill—explained that, under then-current law, a

party could appeal one component of a real property assess-

ment through “various appeal levels.” Audio Recording,

House Floor Debate, House Bill (HB) 2572, May 16, 2011,

at 39:46-42:05 (statement of Rep Phil Barnhart). That lim-

ited, he explained, what the “various appeals bodies” could

consider. Id. Under Measure 50, however, that meant that,

if a taxpayer challenged only one component of the assess-

ment, an error in the other component could not be corrected

176 Village at Main Street Phase II v. Dept. of Rev.

later. Id. He said that the bill was intended to remedy that

problem and prevent under-evaluations that could not later

be corrected. Id. Thus, Representative Barnhart explained

that what is now ORS 305.287 was intended to remedy the

fact that the “various appeal levels” and “various appeals

bodies” were precluded from addressing certain errors in

property assessments.

Before the Senate Committee on Finance and Rev-

enue, Representative Barnhart similarly explained that,

under then-current law, if a taxpayer appealed one compo-

nent of an assessment, Measure 50 would preclude reas-

sessment of the other component. Audio Recording, Senate

Committee on Finance and Revenue, HB 2572, May 25,

2011, at 36:04-38:22 (statement of Rep Phil Barnhart). The

bill before the committee, he explained, was intended to

allow “the local appeals board and the tax court” to consider

all components of a tax account, not just the one that the

taxpayer challenges. Id.

During the same hearing, the policy coordinator for

the Association of Oregon Counties submitted a statement

to the committee asserting that the purpose of the bill was

to permit “the magistrate or judge in a property tax appeal

to ensure the correct final valuation of property in the pro-

cess of making the component value adjustment requested

by the taxpayer.” Testimony, Senate Finance and Revenue

Committee, HB 2572, May 25, 2011, Ex DD (statement of

Gill Riddell, Association of Oregon Counties).

Thus, it appears that the legislature was aware

that, at the least, ORS 305.287 would apply to “various

appeals bodies,” including “the local appeals board” and “the

magistrate or judge” in the Tax Court. Nothing in the leg-

islative history suggests that ORS 305.287 was intended to

apply to only one level of property tax appeal, much less that

the sole level of “appeal” for the purposes of that statute is to

the Magistrate Division of the Tax Court.

That does not necessarily foreclose a conclusion

that the statute nevertheless has a more limited applica-

tion. Analysis of other related statutes and other evidence

of legislative intent may reveal that the legislature did not

intend ORS 305.287 to apply to all four levels of property tax

Cite as 356 Or 164 (2014) 177

appeals. We turn, then, to each of the four levels of property

tax review to determine whether there is evidence that the

legislature intended such a more limited application.

1.  County BOPTA appeals

We begin with the first level of appeal, to a county

BOPTA. As we have noted, the very name of the board—a

board of property tax appeals—indicates that the legis-

lature understood that review by a county BOPTA is, at

least in some sense, an “appeal.” Moreover, as we have also

noted, ORS 305.287 refers to appeals to a “body or tribu-

nal.” A county BOPTA certainly qualifies as one or the

other. Finally, as we have also noted, the legislative history

appears to confirm that the legislature understood that the

statute applied to appeals to, among other things, “the local

appeals board.”

The Tax Court nevertheless concluded that ORS

305.287 does not apply to appeals to a county BOPTA for

two reasons. We find neither reason persuasive.

The Tax Court first noted that applying ORS

305.287 to appeals to a county BOPTA would introduce a

conflict among statutes. The court noted that relevant stat-

utes permit only a taxpayer to appeal to a county BOPTA.

The court then observed that ORS 305.287 is not limited

to cases in which the taxpayer appeals. “Accordingly,” the

tax court concluded, “the appeal referred to in ORS 305.287

cannot be the ‘one-sided’ appeal to a BOPTA.” 20 OTR at

530. The argument does not follow, however. ORS 305.287

merely states that “[w]henever a party appeals” (emphasis

added) the value of real property, other parties may seek

a determination of other components of the valuation the

appealing party may not be challenging. As we have noted,

the statute is written in terms that apply to multiple levels

of appeal. The fact that the generic term “a party” is not

limited to taxpayers does not mean that the statute cannot

apply to taxpayer appeals to a BOPTA. There is no incon-

sistency between ORS 305.287 and the limitation that only

taxpayers may initiate an appeal.

The Tax Court next observed that, under ORS

309.026(2), a county BOPTA may entertain petitions to reduce

178 Village at Main Street Phase II v. Dept. of Rev.

a valuation, but not increase it. Nothing in ORS chapter

309, however, limits a county BOPTA’s authority to increase

a component of a valuation, so long as the total value does

not exceed the current assessment. Again, there is no incon-

sistency between ORS 305.287 and the statutory authority

of a county BOPTA.

2.  Appeals to the Magistrate Division of the Tax Court

We turn to the second level of property tax appeals—

the Magistrate Division of the Tax Court. The Tax Court

concluded that ORS 305.287 applies to appeals to the

Magistrate Division, and all parties agree. So do we.

As we have noted, relevant statutes refer to review

by the Magistrate Division as an “appeal.” Moreover,

ORS 305.287 applies to appeals to a “body or tribunal,”

and the Magistrate Division plainly qualifies. The par-

ties have not identified any text or context that other-

wise suggests that ORS 305.287 should not apply to the

Magistrate Division, and we are aware of none. To the

contrary, the legislative history suggests that the legisla-

ture understood the statute to apply to proceedings before

the Magistrate Division. See Testimony, Senate Finance

and Revenue Committee, HB 2572, May 25, 2011, Ex DD

(statement of Gil Riddell, Association of Oregon Counties)

(stating that bill “permits the magistrate or judge in a

property tax appeal to ensure the correct final valuation

of property”) (emphasis added).

3.  Appeals to the Regular Division of the Tax Court

We next address appeals to the Regular Division

of the Tax Court, the third level of property tax appeals.

As is true with appeals to both the county BOPTA and the

Magistrate Division, ORS 305.287 on its face appears also

to apply to appeals to the Regular Division. The legislature

has labeled Regular Division review as an “appeal.” And the

Regular Division certainly constitutes a “body or tribunal.”

Moreover, as we have just noted, the legislative history sug-

gests that the legislature understood that the statute would

apply to the “magistrate or judge in a property tax appeal.”

Testimony, Senate Finance and Revenue Committee, HB

2572, May 25, 2011, Ex DD (statement of Gil Riddell,

Association of Oregon Counties) (emphasis added).

Cite as 356 Or 164 (2014) 179

The Tax Court nevertheless concluded that “[t]he

mechanisms of the Regular Division and ORS 305.287 do

not fit together well.” 20 OTR at 530. In support of that

assertion, the court cited ORS 305.501(1), which the court

read to state a general principle that Tax Court appeals

must first be heard by the Magistrate Division before going

to the Regular Division. We are not persuaded.

ORS 305.501(1) provides that, if a case has not been

assigned to mediation, “an appeal to the [T]ax [C]ourt shall

be heard by a [T]ax [C]ourt magistrate unless specially

designated by the Tax Court judge for hearing in the reg-

ular division.” (Emphasis added.) Thus, that statute itself

expressly allows the Tax Court to permit tax appeals to be

heard by the Regular Division in the first instance, without

further legislative limitation. And, in fact, Tax Court rules

provide that the Tax Court may designate by rule entire cat-

egories of cases to come directly to the Regular Division or

may authorize by order individual appeals to be heard by

the Regular Division without having gone to the Magistrate

Division. TCR 1 C. Given that the statute already contem-

plates exceptions to the notion that all Tax Court appeals

must originate in the Magistrate Division, it is not clear to

us why applying ORS 305.287 to the Regular Division is

incompatible with the existing statutory scheme.

To the contrary, a review of the statutes defining

the relationship between the Magistrate Division and the

Regular Division suggests that allowing a new issue to be

raised on appeal to the Regular Division is consistent with

the role of the Regular Division. As we have noted, pro-

ceedings before the Magistrate Division are informal, not

reported, and not subject to the rules of evidence. See ORS

305.430(1) (Magistrate Division proceedings not reported);

ORS 305.501(4)(a) (Magistrate Division proceedings gener-

ally not subject to rules of evidence). Such proceedings do not

produce a “record” in the ordinary sense that the Regular

Division later reviews.

In contrast, Regular Division proceedings are “orig-

inal, independent proceedings.” ORS 305.425(1). They do not

entail reviewing a record created by the Magistrate Division.

Rather, they entail the creation of a new record, de novo.

180 Village at Main Street Phase II v. Dept. of Rev.

See id. Any findings of fact by the Magistrate Division—

and the evidence on which it based those findings—do not

bind the Regular Division in any way. See White I v. Dept.

of Rev., 19 OTR 47, 49-50 (2006) (because ORS 305.425(1)

requires Regular Division proceedings to be original, inde-

pendent, and de novo, the Regular Division “cannot rely on

factual statements contained in the magistrate’s decision as

proof of their truth”); Dept. of Rev. v. Guardian Management

Corp., 16 OTR 17, 20 (2002) (“[T]he mandate of *  * [ORS

*

305.425(1)] is such that no party can be compelled to accept

any record created in the Magistrate Division.”).

That combination of statutory directives—requiring

informal proceedings before the Magistrate Division, while

requiring Regular Division proceedings to be original, inde-

pendent, and de novo—means that the parties before the

Regular Division are not limited to the evidence or the argu-

ments that they presented in the Magistrate Division. The

Tax Court itself has recognized as much, observing that

its statutory duty to conduct de novo review of Magistrate

Division decisions allows litigants to “start over with a clean

slate in terms of arguments made and evidence presented.”

Grant Cty. Assessor v. Dayville Public Sch. Dist. 16J, 20 OTR

240, 243 (2011). Or, as the Tax Court has stated on de novo

review of a decision of the Department of Revenue:

“ ‘If either the taxpayer or assessor can improve his case, as

he moves from successive administrative hearings to the

court, by using new approaches (justified by further study)

or offering stronger comparable sales (discovered through

greater diligence), these changes in presentation are per-

mitted under the statutory provision for a presentation “de

novo,” so long as they aid in reaching the goal of true cash

value.’ ”

Clark v. Dept. of Rev., 14 OTR 221, 224 (1997) (quoting Price

v. Dept. of Rev., 7 OTR 18, 23 (1977)).

The Tax Court also expressed concern in this case

that applying ORS 305.287 to the Regular Division would

permit parties, in effect, to avoid the 30-day statutory lim-

itation for appealing from county BOPTAs. Again, we are

not persuaded.

Cite as 356 Or 164 (2014) 181

The Tax Court’s reasoning appears to assume that

ORS 305.287 independently authorizes an appeal, when

the statute plainly does not do that. As we have explained,

ORS 305.287 states that, whenever a party appeals a real

property valuation and challenges only one component of

the valuation, other parties may “seek a determination”

as to other components. The statute neither requires nor

authorizes other parties to file a separate notice of appeal to

obtain that determination. Moreover, ORS 305.280(4) spells

out a deadline for an appellant to file an appeal. It does not

affect a respondent’s time to respond to that appeal. Indeed,

if the Tax Court’s reading of ORS 305.287 were correct, then

even in the Magistrate Division—where everyone agrees

that ORS 305.287 applies—an appellant could foreclose a

respondent from invoking that statute by the simple expedi-

ent of filing the notice of appeal on the 30th day, leaving no

time for the responding party to raise new issues.

In short, ORS 305.287 applies to the Regular Divi-

sion, which is capable of conducting any and all necessary

factfinding to address a new issue raised pursuant to that

statute.

4.  Appeals to the Oregon Supreme Court

The final level of property tax review is an appeal

to this court. The Tax Court concluded that ORS 305.287

does not apply to such appeals, and the parties agree. Once

again, so do we.

On its face, ORS 305.287 would seem to apply to

proceedings before this court as well. As was true for the

Magistrate Division and the Regular Division, this court

is a “body or tribunal,” and the legislature designated the

proceedings before this court as an “appeal.” Other relevant

statutes, however, make clear that the legislature did not

intend ORS 305.287 to apply to appeals from the Regular

Division to the Supreme Court.

As we have noted, this court’s review authority on

appeal from the Regular Division is limited. ORS 305.445

states in part that “the scope of review of either a decision or

order of the [T]ax [C]ourt judge shall be limited to errors or

questions of law or lack of substantial evidence in the record

182 Village at Main Street Phase II v. Dept. of Rev.

to support the [T]ax [C]ourt’s decision or order.” The legis-

lature thus has directed this court not to resolve new ques-

tions of fact in those appeals.

Furthermore, the legislature’s decision to limit

this court’s review authority was deliberate. Before 1997,

this court reviewed decisions of the Tax Court de novo. In

1995, the legislature amended the statute defining this

court’s review authority by eliminating de novo review and

substituting the current, more limited scope of review. See

Or Laws 1995, ch 650, § 25 (establishing present scope of

review); Piedmont Plaza Investors v. Dept. of Rev., 331 Or

585, 588 n 1, 18 P3d 1092 (2001) (noting then-recent change

to scope of review that became effective in 1997, but using

prior de novo standard applicable to that case).

This court could not adhere to that limited scope of

review if parties could raise new valuation issues under ORS

305.287 for the first time on appeal from decisions of the Tax

Court. The value of a component of real property poses a ques-

tion of fact. See Brooks Resources Corp. v. Dept. of Rev., 286 Or

499, 503-04, 595 P2d 1358 (1979) (“The appropriateness of a

particular valuation method or combination of methods is not

determined by fixed principles of law, but is a factual determi-

nation that depends on the record developed in each case.”).

Thus, to decide a new valuation issue under ORS 305.287, this

court necessarily would have to engage in original factfinding.

That sort of original factfinding would be directly contrary to

the scope of review prescribed in ORS 305.445.

We are left with a choice between either reading

ORS 305.287 to apply to appeals to a body or tribunal other

than the Oregon Supreme Court or concluding that the stat-

ute impliedly repealed the limitations on this court’s review

authority under ORS 305.445. Such implied repeals are not

favored in the law. See Arken v. City of Portland, 351 Or 113,

137, 263 P3d 975 (2011) (noting that “repeal of a statutory pro-

vision by mere implication is disfavored”). We therefore con-

clude that ORS 305.287 does not apply to appeals to this court.

B.  Whether ORS 305.287 Applies to This Case

Taxpayers urge that, even if ORS 305.287 applies

to appeals to the Regular Division of the Tax Court, the

Cite as 356 Or 164 (2014) 183

statute should not be applied to them in this case. In tax-

payers’ view, applying the statute to them in this case

would amount to retroactive application of the statute in the

absence of any indication that the legislature intended the

statute to apply in that way. As taxpayers see it, applying

ORS 305.287 to them constitutes “retroactive” application

because they initiated their appeals before the statute went

into effect. The fact that they initiated their appeals to the

Regular Division of the Tax Court after the statute went into

effect, they argue, is of no moment, because those appeals

involved the same “matter” as the previous appeals.

Whether a statute applies retroactively is a ques-

tion of legislative intent, determined by the usual tools of

statutory construction. See Delta Air Lines, Inc. v. Dept. of

Rev., 328 Or 596, 601, 984 P2d 836 (1999) (whether a statute

applies retroactively is determined by applying rules of stat-

utory construction).4 But, before we would need to address

whether the legislature intended ORS 305.287 to be applied

retroactively, we must determine whether applying it to this

case would, in fact, constitute “retroactive” application of the

statute.

Determining what constitutes “retroactive” applica-

tion of a statute can be a difficult task because of the noto-

riously slippery nature of the notion of “retroactivity.” As

Justice Linde observed in Whipple v. Howser, 291 Or 475,

488-89, 632 P2d 782 (1981) (Linde, J., concurring):

“  ‘Retroactivity’ itself is a deceptively simple word for a

complex set of problems. In real time, all laws can oper-

ate only prospectively, prescribing legal consequences after

4

Citing Hoffart v. Lindquist, 182 Or 611, 620, 189 P2d 592 (1948), and Kempf

v. Carpenters and Joiners Union, 229 Or 337, 341, 367 P2d 436 (1961), taxpayers

contend that there is a presumption that statutes apply prospectively. That is not

an accurate statement of current law. As more recent cases make clear, the con-

trolling question is one of legislative intent, determined not by the invocation of

presumptions but by the usual rules of statutory construction. See, e.g., Whipple

v. Howser, 291 Or 475, 480-81, 632 P2d 782 (1981). In the absence of more direct

evidence of legislative intent, the court may resort to various “rules” or “maxims”

of construction pertaining to retroactivity—for example, the rule that substan-

tive statutes ordinarily apply prospectively only, while procedural statutes apply

retroactively. Id. at 481. But there is no presumption against retroactivity per se.

See Delehant v. Board on Police Standards and Training, 317 Or 273, 278, 855

P2d 1088 (1993) (“Retroactive application of a rule is not automatically impermis-

sible, however. The question is one of intent * * *.”).

184 Village at Main Street Phase II v. Dept. of Rev.

their enactment; they cannot change the past. On the other

hand, all new laws operate upon a state of affairs formed to

some extent by past events.”

See also Jill E. Fisch, Retroactivity and Legal Change: An

Equilibrium Approach, 110 Harv L Rev 1055, 1072 (1997)

(noting that “formulating a precise definition of retroactivity

is a difficult enterprise”); W. David Slawson, Constitutional

and Legislative Considerations in Retroactive Lawmaking,

48 Cal L Rev 216, 217 (1960) (“Enough has already been

said to show that the concept of retroactivity has not been

precisely analyzed in the literature to date and to suggest,

perhaps, that the concept is not capable of precise analysis.”).

“Retroactive” legislation often refers to laws that

“affect[  existing legal rights or obligations arising out of

]

past transactions or occurrences.” E.g., U.S. Bancorp v.

Dept. of Rev., 337 Or 625, 636-37, 103 P3d 85 (2004) (so stat-

ing). But whether a law “affects” existing rights or obliga-

tions depends on the nature of the law at issue; there is no

bright-line test. As this court explained in ZRZ Realty v.

Beneficial Fire and Casualty Ins., 351 Or 255, 262, 266 P3d

61 (2011), “  ‘[r]esponsible attention to the significance to be

attached to past events cannot be compressed into a sim-

ple formula. Too many different past events and too many

potential legal consequences are relevant for different kinds

of laws’ to announce a single formula” that would apply to all

statutes. (Alteration in original; quoting Whipple, 291 Or at

489 (Linde, J., concurring).)

With that in mind, we turn to the statute at issue

in this case. As we have noted, ORS 305.287 is directed at

issues that parties may raise “[w]henever a party appeals

the real market value of one or more components of a prop-

erty tax account.” We have just concluded that the “appeals”

to which the statute applies include appeals to the Regular

Division of the Tax Court. In this case, taxpayers appealed

to the Regular Division of the Tax Court after ORS 305.287

went into effect. Thus, the application of that statute to their

appeal is not retroactive.

Taxpayers object that the operative “appeal,” for

purposes of retroactivity analysis, is their appeal to the

Cite as 356 Or 164 (2014) 185

Magistrate Division, which occurred before ORS 305.287

went into effect. Taxpayers reason that their appeal to the

Regular Division was a part of the same “matter” that was

appealed to the Magistrate Division, which is but a different

division of a single Tax Court.

The objection is not well taken. ORS 305.287

applies to “appeals,” not to “matters.” As we have explained,

an appeal to the Regular Division is entirely separate from

an appeal to the Magistrate Division. Indeed, an appeal

to the Regular Division is “original” and “independent” of

prior proceedings or appeals and is “tried * * * de novo.” ORS

305.425(1).

Accordingly, we conclude that ORS 305.287 applies

to appeals filed after that statute’s effective date. Because

we have already determined that ORS 305.287 applies to

appeals to the Regular Division, and because taxpayers

appealed to the Regular Division after that statute became

effective, ORS 305.287 applies to these appeals. The Tax

Court erred in concluding otherwise.

The limited judgments of the Tax Court are

reversed, and the cases are remanded to the Tax Court for

further proceedings.