Indianapolis Pub. Transp. Corp. v. Dep't of Local Gov't Fin.

40 N.E.3d 536

INDIANAPOLIS PUBLIC TRANSPORTATION CORPORATION, Petitioner

v.DEPARTMENT OF LOCAL GOVERNMENT FINANCE, Respondent.

No. 49T10–1203–TA–19.

Tax Court of Indiana.

July 15, 2015.

Beth H. Henkel, Law Office of Beth Henkel LLC, Indianapolis, IN, Attorney for Petitioner.

Gregory F. Zoeller, Attorney General of Indiana, Evan W. Bartel, Deputy Attorney General, Indianapolis, IN, Attorneys for Respondent.

ORDER ON RESPONDENT'S MOTION FOR JUDGMENT ON THE PLEADINGS

WENTWORTH, J.

Indianapolis Public Transportation Corporation (“IndyGo”) filed an appeal with this Court after the Department of Local Government Finance (“DLGF”) issued the 2012 Budget Order for Marion County. The matter is currently before the Court on the DLGF's Motion for Judgment on the Pleadings (Motion). In that Motion, the DLGF asserts that IndyGo does not have standing to bring its appeal and therefore its case must be dismissed. Being duly advised, the Court denies the DLGF's Motion.

BACKGROUND

IndyGo, a public transportation corporation formed and operating under Indiana Code § 36–9–4, provides bus service throughout Marion County, Indiana.¹ See Indianapolis Pub. Transp. Corp. v. Dep't of Local Gov't Fin., 988 N.E.2d 1274, 1275 (Ind. Tax Ct.2013). In late summer of 2011, IndyGo, through its authorized officers and after the appropriate public hearings, adopted its proposed budget for 2012, complete with estimated property tax levies and applicable tax rates.² (See, e.g., Pet'r Pet. Judicial Review (“Pet.”), Exs. A, C.) Pursuant to Indiana Code § 36–3–6–9, IndyGo submitted its proposed budget to the City–County Council of Indianapolis and Marion County (the Council).³ (See Pet., Ex. C.)

On October 17, 2011, the Council made several changes to IndyGo's proposed budget appropriations and tax levy rates.

(Compare Pet., Ex. C at 8 with Ex. D at 8.) See also Ind.Code § 36–3–6–9 (2011) (providing that when the Council reviewed IndyGo's proposed budgets and tax levies, it was allowed to “reduce or modify but not increase” them). Meanwhile, the Council was in the process of preparing proposed 2012 budgets for the City of Indianapolis and Marion County. (See Pet. ¶¶ 24–25⁴ , Ex. E.) Ultimately, all three budgets were forwarded to the DLGF for review. See, e.g., Ind.Code § 36–9–4–51(d) (2012) (providing not only that the budgets for IndyGo, the City of Indianapolis, and Marion County were to “be prepared and submitted at the same time, in the same manner, and with the same notice[,]” but also that the DLGF could review them “in the same manner”).

On February 3, 2012, the DLGF issued “1782 Notices” to all taxing units within Marion County advising them of the revisions, reductions, and adjustments that it proposed to make to their budgets, rates, and levies. (See Pet. ¶¶ 27–30, Exs. F–H.) See also Ind.Code § 6–1.1–17–16(d) (2012) (explaining that the DLGF shall provide notice to each political subdivision specifying any proposed revision, reduction, or increase to its tax levies or rates). For instance, the DLGF indicated that, among other things, it was reducing the tax rates applicable to the City of Indianapolis's debt service and cumulative capital development fund levies and Marion County's general fund levy. (See Pet., Exs. G at 2, H at 2.) The DLGF also reduced the tax rates applicable to IndyGo's debt service and transportation cumulative fund levies. (Compare Pet., Ex. D at 8 with Ex. F at 3–4.) The City of Indianapolis, Marion County, and IndyGo were all given time to respond to the DLGF's proposed adjustments. (See Pet., Exs. F at 1, G at 1, H at 1.) See also I.C. § 6–1.1–17–16(d).

On February 7, 2012, IndyGo submitted a response asserting that the DLGF made several errors in calculating IndyGo's tax rate adjustments. (See Pet. ¶ 31, Ex. I.) The DLGF sent an email to IndyGo stating that the tax rate adjustments would remain in place. (See Pet. ¶ 40–41, Ex. K at 2.)

On February 15, 2012, the DLGF issued the 2012 Budget Order for Marion County which incorporated the final budgets, tax rates, and tax levies for IndyGo, the City of Indianapolis, and Marion County. (See Pet. ¶ 41, Ex. L.) On February 22, 2015, IndyGo sent an email to the DLGF identifying yet another error with respect to the DLGF's adjustment to IndyGo's debt service fund levy. (See Pet. ¶ 43, Exs. M at 2, N at 1.)

On February 27, 2012, the DLGF amended the 2012 Budget Order for Marion County. (See Pet. ¶ 44, Ex. O.) The amended 2012 Budget Order for Marion County did not address, however, any of the objections or errors raised by IndyGo relating to its tax package. (Pet.¶ 44.)

On March 28, 2012, IndyGo initiated an original tax appeal. IndyGo's petition stated in relevant part:

This is an action for judicial review pursuant to Ind[iana] Code § 6–1.1–17–16 ... [that] arises out of the DLGF's issuance of the 2012 Marion County Budget Order on February 15, 2012, over the objections of IndyGo as to certain matters detailed [t]herein. [ ]The DLGF subsequently amended and reissued the 2012 Marion County Budget Order on February 27, 2012, but the DLGF failed to address the issues to which IndyGo objected.... IndyGo has standing to bring this action, as the 2012 Budget Order, as amended, will result in a reduction of an estimated $768,330 in the 2012 General Fund and an estimated $39,924 [ ] in the Debt Service Fund levy.... This Petition is timely filed within 45 days of the date of the DLGF's issuance of the original 2012 Marion County Budget Order, in accordance with Ind[iana] Code § 6–1.1–17–16.

(Pet. ¶¶ 1, 4–5, 7, 9.)

On May 4, 2012, the DLGF filed its Motion pursuant to Indiana Trial Rule 12(C), asserting that because IndyGo did not have standing to appeal from the 2012 Budget Order for Marion County under Indiana Code § 6–1.1–17–16(g)(1), its case must be dismissed. (See Resp't Br. Mot. J. Pleadings (“Resp't Br.”) at 2–3.) The Court conducted a hearing on the DLGF's Motion on July 9, 2012. Additional facts will be supplied as necessary.

STANDARD OF REVIEW

“A motion for judgment on the pleadings pursuant to Ind[iana] Trial Rule 12(C) attacks the legal sufficiency of the pleadings.” Eskew v. Cornett, 744 N.E.2d 954, 956 (Ind.Ct.App.2001) (citation omitted), trans. denied. Thus, “[a] judgment on the pleadings is proper only when there are no genuine issues of material fact and when the facts shown by the pleadings clearly establish that the non-moving party cannot in any way succeed under the facts and allegations therein.” Id. (citation omitted).

When ruling on a motion for judgment on the pleadings, the Court looks solely at the pleadings and accepts all well-pleaded facts as true. See id. The moving party is deemed to have admitted those facts in favor of the non-moving party and the Court will draw all reasonable inferences in the non-moving party's favor.⁵ Id. In this case, the pleadings consist of IndyGo's petition for judicial review, the exhibits attached thereto, and the DLGF's answer. See Ind. Trial Rule 7(A) (explaining that the pleadings consist of, among other things, a complaint and an answer); Gregory & Appel, Inc. v. Duck, 459 N.E.2d 46, 50 (Ind.Ct.App.1984) (explaining that exhibits attached to a complaint are made part of the complaint).

LAW

A. Standing

The judicial doctrine of standing focuses on whether the complaining party in a lawsuit is the proper party to invoke the court's power. Bielski v. Zorn, 627 N.E.2d 880, 888 (Ind. Tax Ct.1994). More specifically, it “insure[s] that the party before the court has a substantive right to enforce the claim that is being made in the litigation.” Pence v. State, 652 N.E.2d 486, 487 (Ind.1995). Standing reflects that the plaintiff has a personal stake in the outcome of the lawsuit and has sustained, or is in immediate danger of sustaining, some direct injury as a result of the conduct at issue. Schloss v. City of Indianapolis, 553 N.E.2d 1204, 1206 (Ind.1990).

B. Indiana Code § 6–1.1–17–16

Indiana Code § 6–1.1–17–16 sets forth both the procedure by which the DLGF reviews the budgets, tax rates, and tax levies of political subdivisions and the mechanism by which the DLGF's review is then appealable to this Court. During the period at issue in this case, the relevant portions of that statute provided:

(d) Except as provided in subsection (i), IC 20–46, or IC 6–1.1–18.5, the department of local government finance may not increase a political subdivision's budget by fund, tax rate, or tax levy to an amount which exceeds the amount originally fixed by the political subdivision. However, if the department of local government finance determines that IC 5–3–1–2.3(b) applies to the tax rate, tax levy, or budget of the political subdivision, the maximum amount by which the department may increase the tax rate, tax levy, or budget is the amount originally fixed by the political subdivision, and not the amount that was incorrectly published or omitted in the notice described in IC 5–3–1–2.3(b). The department of local government finance shall give the political subdivision written notification specifying any revision, reduction, or increase the department proposes in a political subdivision's tax levy or tax rate. The political subdivision has ten (10) calendar days from the date the political subdivision receives the notice to provide a written response to the department of local government finance's Indianapolis office. The response may include budget reductions, reallocation of levies, a revision in the amount of miscellaneous revenues, and further review of any other item about which, in the view of the political subdivision, the department is in error. The department of local government finance shall consider the adjustments as specified in the political subdivision's response if the response is provided as required by this subsection and shall deliver a final decision to the political subdivision.

* * * * *

(f) The department of local government finance shall certify its action to:

(1) the county auditor;

(2) the political subdivision if the

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