In a proposed decision released Wednesday, the tax appeals board affirmed the values assessed by King County Assessor John Wilson for the warehouses for 2018, rejecting Amazon's claim that the large single-tenant buildings do not command as high a price as smaller multitenant buildings.
Amazon sought a combined valuation of $111 million, arguing that Wilson used rental rates and comparable sales of differently sized and sometimes smaller properties instead of properties similarly sized to its "mega-warehouses."
The board, however, found that Amazon failed to meet its burden of showing the assessor likely overvalued the properties in the first place. The board said the comparable rental rates used in the company's cost approach were for months earlier than the assessment date and included rents for a vacant property.
"For the owner to prevail in these appeals, the hearing record must contain clear, cogent, and convincing evidence that value corrections are in order," the board said. "The evidence before the board does not meet this standard."
Amazon also argued under an income capitalization approach that some areas of the warehouses containing robotics storage should be viewed as personal property rather than real property. Instead, the board found that the company did not provide evidence that it paid a personal property tax assessment for that area of the warehouse.
The board also rejected Amazon's cost and income capitalization approaches for excluding certain relevant factors and explanations, including entrepreneurial incentive, a proper explanation of actual costs, the value of office space and an acknowledgement that shelf space would raise rental rates.
The proposed decision was issued Aug. 28. Proposed decisions become final 20 calendar days after being issued unless a written exception is filed by one of the parties, according to the decision. It is unclear if an exception was filed in this case.
Jim Hall, the chief appraiser for the King County Department of Assessments, told Law360 in an email on Monday that he could not find any exception filed in the case. He added that due to COVID-19, there have been administrative slowdowns and the board still may still be catching up.
Spokespersons for Amazon did not immediately respond to requests for comment on Friday.
Counsel information was not immediately available.
The case is Amazon.Com.DEDC LLC v. John Wilson, case numbers 95531 and 95532, in the Washington Board of Tax Appeals.
--Editing by Vincent Sherry.
Update: This article has been updated with comment from the King County Department of Assessments.
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