The owner of the former Ingalls school plans to appeal Farmington’s valuation for the property directly to the state, and says the matter may be headed to court.

The Farmington Board of Assessment Review voted Sept. 3 to reduce the 2024 property valuation by $361,500, making it $900,000 in an effort to compromise.

The actual worth of the property at 144 High St. has been a matter of debate. Ingalls Leasing, which owns the property, proposed selling it to Regional School Unit 9 for nearly $1.6 million but voters rejected the idea in May.

The property was previously owned by Tri County Mental Health Services, a nonprofit entity, which sold it May 10, 2023, to Ingalls Leasing for $470,000. The town had assessed the property at $1.26 million in 2013.

Now, the company, through its attorney Scott Herrick of Drummond & Drummond of Portland, argues that the property at fair market value is worth $470,000 and should be assessed at $371,300, using the town’s 79% state ratio certification for 2024.

The certified ratio, expressed as a percentage, shows how close a municipality’s assessed property values are to their just value.

Farmington completed a property revaluation recently to raise the certified ratio and those new values were sent to all owners Sept. 12.

Town assessor Frank Xu said during the Sept. 3 hearing that the $1.26 million valuation assessed by the town was determined using a state-approved appraisal system.

The 2023 purchase price raised significant concerns about its reliability as a representation of the full market value. The seller was a nonprofit entity and there was a favorable leaseback agreement, likely influencing the transition price, Xu wrote in a letter to the company earlier this year.

Xu said the property had been on the market for over two years, often a condition associated with seller concessions or atypical motivation. He also argued previously that the sale price does not align with subsequent market indicators and valuations for similar commercial properties with the town.

Herrick argued that the 2023 sale price should be a factor in the valuation.

He said the property was assessed at a fair market value of just under $1.6 million initially, and the board changed it to just under $1.14 million using the 79% state certified ratio.

“My client will appeal, given the new fair market valuation is still 2.4 times what was paid on the open market just (seven) months prior to the 2024 tax year,” Herrick wrote in an email to the Sun Journal. “I would note that we plan on appealing to the State Board of Property Tax Review as the statute indicates that if the property’s equalized value exceeds $1 million, that is the appropriate venue, but will reserve our right to proceed in Franklin County Superior Court as the Town’s written decision letter indicated that this is the appropriate place to appeal.”  

Maine law allows an abatement to be granted if the property materially is overvalued, generally 10% or more, Herrick said. It also requires the assessor to give great weight to the sale price in the assessment if it is a third-party sale on the open market in close time to the assessment.

The owner purchased the property after it had been listed with a broker on the open market for two years. There were no factors or agreements that would artificially lower the price, and it was an open market sale between unrelated third parties for full consideration, he said.