SOUTH PORTLAND – The city won the latest challenge of its tax assessment on the Maine Mall this week after the mall’s owners failed to turn over their own appraisals of the property.
The city and General Growth Properties, which has owned the mall for nearly a decade, have staged nearly annual battles over the property tax bill for Maine’s premier retail location, but South Portland has prevailed each time.
That includes the challenge to the city’s 2009 assessment, which was dismissed by the state Board of Property Tax Review on Thursday.
Appeals of assessments for 2010 and 2012 are still pending, but William Dale, the city’s lawyer, said the company’s failure to produce its own appraisals may lead the state panel to summarily dismiss those cases as well.
David Keating, a spokesman for Chicago-based General Growth Properties, which is commonly referred to as GGP, declined comment Friday.
The company can appeal the board’s ruling in court and hasn’t yet indicated whether it will continue its challenge of the 2009 assessment.
Dale said the company and city have come up with dramatically different appraisals for the property over the years.
In 2006, the city valued the property — which includes a largely undeveloped lot across Maine Mall Road in addition to the mall itself — at $261 million, a drop from the $270 million Growth Properties had paid three years previously. The company, however, argued that the property’s value had dropped sharply and was worth just $190 million.
The Board of Property Tax Review ruled in the city’s favor on that case in 2009.
The company appealed its 2009 assessment as well, saying that city’s assessment of $241 million was $61 million too high.
According to Dale, Growth Properties said it hadn’t conducted its own appraisal of the property, but court records in the company’s bankruptcy reorganization — it filed for court protection in 2009 and emerged in 2010 — indicated the company paid more than $3.7 million to an appraisal firm to determine the values of most of its properties.
The Maine Mall is listed as one of the 329 properties that the firm of Cushman & Wakefield was to appraise for creditors under a May 2009 contract.
When the company failed to turn over any appraisal, the board dismissed the company’s appeal.
Dale said state law requires the company to provide copies of any appraisals it has produced, along with some other business records.
Growth Properties’ appeal of the 2010 assessment was just rejected by the South Portland Board of Assessment Review and is being appealed to the state board, Dale said.
He said he would again seek the company’s appraisal and if the company doesn’t turn one over, ask the state board to reject the appeal on the same grounds as the 2009 appeal.
The ruling won’t result in any windfall for South Portland.
Dale said that state law requires a property owner to pay taxes based on the city’s assessment and then seek a refund by appealing to local and state boards.
He said the taxes on the property were about $1.5 million higher each year under the city’s assessment versus the amount the company claimed.
But the city will save on legal fees if the appeal is dismissed before formal hearings are held.
Dale said it costs up to $100,000 to defend an assessment, including legal fees and the cost of bringing in expert witnesses.
Staff Writer Edward D. Murphy can be contacted at 791-6465 or at: