Court upholds taxable value on apartment owner

By Cy Ryan

Tuesday, Sept. 30, 2008 | 11:12 a.m.

A company that owns 16 apartment complexes in Clark County has lost its bid to lower its taxable value by $24.5 million.

The Nevada Supreme Court ruled the state Board of Equalization properly accounted for the full cash value of Olen Residential Realty Corp., which had argued the county assessor failed to take into account the construction defects on the property in setting their values for the 2004-2005 tax year.

Olen Residential claims there were significant construction defects on the roofs, walls, chimneys, balconies, glass doors and others areas. It suggested its taxable value for that year should have been $11.8 million, not $36.3 million.

During its battle with the local and state governments, Olen received a $112 million judgment in a construction defect suit it had started involving some of its apartment.

The Supreme Court, in a 21-page unanimous decision, ruled the Clark County Assessor’s Office had properly considered the construction defects in its formula to figure the taxable value.

The court said the state and lower court records “demonstrates that the assessor appraised each parcel of land and its improvements” as required by a formula in the law.

The court, in a footnote to its decision, said Olen Residential in future years may apply for lower taxable values if its rental income decreases or the cost of repairs rise.