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Dispute Involving Taxation of Parcels Located in Multiple Towns Resolved in Favor of the Town of Sudbury

In John T. Adams, II v. Town of Sudbury, 2016 VT 11 (January 22, 2016), the Vermont Supreme Court affirmed the trial court’s decision regarding the taxation of a condominium community that lies in the Towns of Sudbury and Hubbardton.

Issue: Appellant and the Town of Sudbury had been involved in a long-standing dispute regarding the assessment of certain common lands located within the Wanee Villas and Resort condominium complex. The Wanee condominium complex consists of 26.9 acres substantially all of which is located in the Town of Hubbardton, including all of the privately owned residential units. However, a 1.29 acre tract of land common to the condominium development, and which includes 285 feet of frontage on Lake Hortonia, lies within the Town of Sudbury. The Town of Sudbury assessed the parcel and apportioned the tax due among the unit owners based upon their percentage interest in the condominium complex. Appellant objected to the assessment and brought suit against the Town of Sudbury. The trial court ruled in favor of the Town with respect to the calculation of the assessment and apportionment of the tax due.

Holding: The Court affirmed the trial court on all three issues raised on appeal. First, the Court affirmed the constitutionally of 27A V.S.A. § 1-105 which allows towns to tax common elements of a complex which are within their bounds even if the units themselves are located in another town. Appellant alleged that the statute violated the Equal Protection Clause of the Fourteenth Amendment of the U.S. Constitution and the Proportional Contribution Clause of the Vermont Constitution. This allegation was based on the assertion that a property with common lands in more than one town would be taxed at a higher total rate. The Court reasoned that Appellant had failed to prove that the combined valuations by Sudbury and Hubbardton exceeded the property’s fair market value. Next, the Court affirmed the trial court’s finding that Sudbury’s valuation of the parcel was reasonable and based on appropriate appraisal methods. Finally, the Court affirmed the trial court’s holding that the apportionment of the tax among condominium unit owners in relation to their percentage interest in the condominium complex was reasonable.

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