State of Wisconsin ex rel. Collison v. City of Milwaukee Board of Review (Property Tax Assessment)

In State of Wisconsin ex rel. Collison v. City of Milwaukee Board of Review (2018AP669), the Court of Appeals District I upheld the tax assessment of a property with environmental pollution.

Property owner Ronald Collison appealed a $31,800 tax valuation of his property, arguing the property’s fair market value is zero dollars due to environmental pollution. However, the court upheld the assessor’s decision to derive market value by potential income generated from the property. The assessor was aware that there was contamination but had no information regarding the extent or cleanup costs. In reaching the $31,800 valuation, the assessor found that the property could generate income as a parking lot regardless of contamination. The court found that the assessor properly used the income assessment approach because it represented the highest and best use of the property.

Collison further challenged the legality of the City of Milwaukee Environmental Contamination Standards (CMECS), which he argued conflict with a requirement in Wis. Stat. § 70.32(1m) requiring assessors to consider impairment value from environmental pollution. CMECS prohibit assessors from valuing property as contaminated unless an audit has substantiated the contamination. The court rejected Collison’s argument because the assessor took into account impairment from environmental pollution even though the property had not undergone an audit.

Finally, Collison argued that the income approach in the Wisconsin Property Assessment Manual conflicts with § 70.32(1m). The court held that the assessor’s use of the income approach was compatible with the statutory requirements to take environmental pollution into account.