By Amanda Estes

Staff Writer

In a much quicker process than anticipated, South Portland’s Board of
Assessment Review denied Maine Mall owner, Chicago-based General Growth
Properties’ (GGP) a property tax abatement – but the debate isn’t over
yet.

GGP will take its appeal to the Maine State Board of Property Tax
Review after representatives arrived at a Dec. 12 meeting before the
board of assessment review, unprepared to answer questions due to a
risk of criminal prosecution.

The seven-member, council appointed board acts in a “quasi-judicial”
capacity and hears appeals of the assessor’s denial of an abatement or
exemption request.

Jonathan Goldberg, an attorney with the Portland firm MittelAsen
representing the company, said GGP had been preparing for months to
argue its case before the board, but that case was largely focused on
the testimony of Washington, D.C. appraiser David Lennhoff, who
prepared a report challenging South Portland Assessor Elizabeth
Sawyer’s April 1, 2006 appraisal. Massachusetts attorney Anthony
Ambriano had planned to represent Lennhoff and conduct the
cross-examination of the city assessor, however, there was some
question as to whether out of state counsel had the authority to appear
before the board. Goldberg said. Ambriano was present at the meeting,
but did not participate because his involvement could put his license
at risk, Goldberg said.

“We’re sorry it worked out this way,” Goldberg said. “It was not by choice. We were caught short.”

According to Lennhoff’s report, the 73.4-acre Maine Mall area, divided
into 11 tax parcels, has a “retrospective ‘just’ value on April 1,
2006” of roughly $190 million. The report finds Sawyer’s assessment of
roughly $262 million to be incorrect because it does not deduct value
for the income attributed to “management expertise, tangible personal
property and intangible personal property including reputation,
operating agreements with the three anchors, assembled work force, etc.”

“It isn’t necessarily a fully accepted appraisal technique in this
country and [has] lost cases –  on this issue,” Sawyer said of
Lennhoff’s interpretation.

GGP’s report states the property was purchased in October 2003 for $265
million, but also states it has “evolved over time and suffers from
various forms of depreciation.”

“If anything that type of property has increased in value,” Sawyer countered.

Should GGP be granted an abatement, depending on the tax rate, the city
could be forced to return between $900,000 and $1 million to GGP for
the 2006 tax year, Sawyer said.

“We’re already into the 2007-2008 tax year so you could double that
number because I’m certain that would carry forward to the next year,”
she said.  

South Portland Board of Assessment Review members were visibly
frustrated about GGP’s intent to rest on the submitted report and even
questioned the report’s authenticity.

“As a board member, I’m in the uncomfortable position to make a
decision without the information,” said board chairman Paul Cloutier.
He said the property owner has the responsibility of providing a weight
of evidence to prove the city’s assessment is wrong.

With no on present to testify about GGP’s report, Attorney William
Dale, representing Sawyer, requested it be thrown out of the
proceedings.

“We learned only moments ago that Mr. Lennhoff would not be here,” Dale said. “I have two file folders full of questions.”

Dale said the city had been asking GGP for the appraisal report for a
year. The report was prepared in October and the city received it 10
days before the hearing. Dale said he requested a continuance in order
to have an expert review the report, but GGP refused to agree to
delaying the proceedings.

The board of assessment review voted 5-0 to deny the abatement. Board
member Brian Linscott was absent from the hearing and Joseph Conroy
recused himself, saying he is a neighbor and a friend of Dale’s and
felt uncomfortable participating.

Goldberg said he and the GGP team will have further consultations with
the attorney general’s office to determine whether Ambriana will be
able to act as counsel before the state board.

Board member Maureen Hasson said she was at a loss to make a decision
that night without the expert testimony, but expressed some regret the
matter will now be turned over to the state.

“I think it’s too bad because the properties are in South Portland and they’re very important properties,” she said.