HomeMy WebLinkAbout29. 22-275JUNE 28, 2022 22-275 RESOLUTION
(CARRIED___7-0_____LOST________LAID OVER________WITHDRAWN________)
PURPOSE: APPROVE SETTLEMENT AGREEMENT WITH BEECHWOOD
PLAZA HOTEL OF OSHKOSH, LLC (HILTON GARDEN INN)
FOR PROPERTY TAX ASSESSMENTS FOR TAX YEARS 2021-2022
FOR PROPERTY LOCATED AT 1355 WEST 20TH AVENUE
INITIATED BY: LEGAL DEPARTMENT
WHEREAS, Beechwood Plaza Hotel of Oshkosh, LLC filed suit challenging the
property tax assessment for its property, the Hilton Garden Inn, located at 1355 West 20th
Avenue in the City of Oshkosh; and
WHEREAS, the parties have reached a tentative settlement of this matter
contingent upon the approval of the Common Council compromising the claims for tax
years 2021 and 2022.
NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of
Oshkosh that the proper City officials are hereby authorized to enter into an appropriate
settlement agreement with Beechwood Plaza Hotel of Oshkosh, LLC pertaining to
property located at 1355 West 20th Avenue in the City of Oshkosh in resolution of current
litigation between the parties, 20-CV-557 in Winnebago County Circuit Court, according
to the following terms and conditions:
City staff will adjust the 2021 and 2022 assessment on the parcel to reflect a total
assessed value amount of $6,225,000.00.
The City will refund taxes for 2021 in the amount of $37,645.50 and shall pursue
chargeback as provided under the Wisconsin Statutes in relation to the other
taxing jurisdictions as detailed on the attachment to this resolution.
The City will adjust the assessed value for 2022 based upon the settlement
agreement.
JUNE 28, 2022 22-275 RESOLUTION
CONTD
Beechwood Plaza Hotel of Oshkosh, LLC will dismiss the lawsuit against the City and
the parties assert that they will release any claims against the other party and will
not file any further actions against the other party in relation to the subject matter
of this litigation.
BE IT FURTHER RESOLVED that the proper City Officials are hereby authorized
and directed to execute and deliver an agreement substantially in compliance with the
terms listed above, any changes in the execution copy being deemed approved by their
respective signatures, and said City officials are authorized and directed to take those
steps necessary to implement the terms and conditions of the Agreement.
City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5000 http://www.ci.oshkosh.wi.us
TO: Mayor and Members of the Common Council
FROM: Lynn A. Lorenson, City Attorney
DATE: August 10, 2018
RE: Approve Settlement Agreement with Beechwood Plaza Hotel of Oshkosh, LLC
(Hilton Garden Inn) for Property Tax Assessments for Tax Years 2021-2022 for
Property Located at 1355 West 20th Avenue
BACKGROUND
Beechwood Plaza Hotel of Oshkosh, LLC filed suit claiming excessive assessment for its
property located at 1355 West 20th Avenue in the City of Oshkosh seeking a refund of taxes paid
in 2021 and a reduced assessed value for 2022. Beechwood Plaza Hotel of Oshkosh, LLC owns
and operates the Hilton Garden Inn which sits on lands leased from Winnebago County on 20th
Avenue adjacent to the airport on the west side of Oshkosh near the interchange of Interstate 41
and 20th Avenue.
ANALYSIS
The 2021 Total Assessed Value of the property established by the Assessor was $7,579,400. The
value for this property was set in 2017 and has not changed through the course of several years
to the present. There have been no major alterations or additions to the site in that time.
Beechwood alleges a value for the property at $4,529,426 based upon a comparison with other
local Oshkosh hotels, and in particular based upon the value per room of the Holiday Inn
Express hotel. Beechwood hired an expert who compared the assessment of this hotel to other
hotels, and concluded that the assessment was not uniform and was too high. While this is not
a typical method for assessors to use in valuing properties, it is somewhat common in the hotel
market and can be converted to an assessed value. Based upon this method, Beechwood argues
that its hotel is valued significantly higher than other hotels in the City of Oshkosh.
The attorneys for the parties met with a mediator on Monday, June 20th and had extensive
conversations and negotiations on value. The City was represented by Attorney Ryan
Braithwaite of the Stafford Rosenbaum law firm, City Attorney Lynn Lorenson, City Assessor
Luke Alger and Contract Assessor Marty Kuehn with Tyler Technologies and have agreed to
recommend a two year settlement to their respective clients in the amount of $6,225,000 for the
assessed value, a reduction of $1,354,400 in assessed value. This amount results in a refund of
$37,645.50 for 2021.
The prior citywide reassessment was in 2017 and properties such as the Hilton Garden Inn
which had no sale or significant improvement have generally remained at the value set during
that assessment process. The City Assessor has reviewed this property for 2021 and 2022 and
recognizing that property valuation is a range of value, believes that the proposed settlement is
fair and equitable given the nature of the building, its condition and the assessment of other
hotel properties in Oshkosh. The final settlement amount of $6,225,000 was based on a
comparison with the Best Western hotel per room and gross building area values. The
$6,225,000 assessed value equates to $7,511,765 for a fair market value for 2021 and $8,412,162
for a fair market value in 2022.
It is worth noting that the City is anticipating a citywide reassessment in 2024 when all
properties will again be comprehensively reviewed.
FISCAL IMPACT
The reduced value will result in a refund of $37,645.50 for the 2021 taxes which had already been
paid. The appropriate amounts have been calculated for chargebacks to each of the taxing
jurisdictions. The City will ultimately be responsible for 41.764%, or $15,722.23, of the total
refund following chargeback approval. The attachment to the resolution details the calculation
and specific chargeback amounts for tax year 2021. There will be no interest paid on the
refunded amount.
Because the property tax roll has not yet been set for the 2022 tax year, the assessor will make
an appropriate adjustment for 2022 as required by the agreement and the taxes will be calculated
based on the adjusted amount when tax bills are sent in December.
RECOMMENDATION
Based upon all of the facts of this case, the Staff recommends that the Council pass the proposed
resolution and authorize staff to enter into an appropriate settlement agreement with
Beechwood Plaza Hotel of Oshkosh, LLC for the 2021-2022 tax years.
Respectfully Submitted, Approved:
Lynn A. Lorenson Mark A. Rohloff
City Attorney City Manager
Property
Parcel
Year
Assessed
Rate Original Settlement Difference
Total FMV 9,146,053 7,511,700
Assessment Ratio 0.8287072 0.8287072
Total Assessed Value 7,579,400 6,225,000
State - - - -
County 5.407 40,978.84 33,656.13 7,322.71
City 11.608 87,983.62 72,261.39 15,722.23
School District 11.350 86,027.47 70,654.80
School Credit (1.660) (12,578.87) (10,331.09)
Net School District 73,448.60 60,323.71 13,124.89
Tech College 1.090 8,258.03 6,782.36 1,475.67
Total 27.795 210,669.09 173,023.59 37,645.50
Total Refund 37,645.50
BEECHWOOD PLAZA HOTEL OSHKOSH
1355 W 20TH AVENUE
13-2301-0007
2021
I:\City Clerk\COUNCIL MEETING\Agendas\2022\06282022\Attachments\29. 22-275 attachment 1 - Copy of Beechwood Tax Refund Calculation