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ATTORNEYS FOR PETITIONER: JAMES W. BEATTY STEPHEN M. TERRELL LANDMAN & BEATTY Indianapolis, IN

ATTORNEYS FOR RESPONDENT: STEVE CARTER ATTORNEY GENERAL OF INDIANA LINDA I. VILLEGAS DEPUTY ATTORNEY GENERAL Indianapolis, IN _____________________________________________________________________

IN THE INDIANA TAX COURT
_____________________________________________________________________ PEDCOR INVESTMENTS-1996-XXV, L.P., ) ) Petitioner, ) ) v. ) Cause No. 49T10-0205-TA-56 ) JACKSON TOWNSHIP ASSESSOR, ) ) Respondent. ) _____________________________________________________________________ ON APPEAL FROM A FINAL DETERMINATION OF THE INDIANA BOARD OF TAX REVIEW _____________________________________________________________________ NOT FOR PUBLICATION May 9, 2007 FISHER, J. Pedcor Investments-1996-XXV, L.P. (Pedcor) appeals from a final determination of the Indiana Board of Tax Review (Indiana Board) valuing its real property for the March 1, 1998 assessment date. The sole issue for the Court to decide is whether the Indiana Board erred in denying Pedcor's low-income housing project an economic obsolescence depreciation adjustment. FACTS AND PROCEDURAL HISTORY In early 1998, Pedcor completed construction on "Phase I" of its Sycamore Springs apartment complex, located in Seymour, Indiana. Pedcor designed Phase I as

low-income housing in order to qualify for tax credits pursuant to Section 42 of the Internal Revenue Code (the LIHTC Program). 1 Pedcor subsequently completed a

second phase ("Phase II") of construction in the apartment complex. Phase II, however, operates as market-rate housing; it is not low-income housing. Under the LIHTC program, Pedcor received approximately $2.5 million in tax credits to award to investors, over a ten-year period, who provided financing for Phase I. In exchange for these tax credits, Pedcor agreed to rent all 128 units in Phase I to individuals whose income was 60% or less of the area's median gross income (adjusted for family size) and subject to Indiana Housing Finance Authority (IHFA) rental guidelines. Pedcor agreed to abide by these rental restrictions for a period of 30 years. Effective with the March 1, 1998 assessment date, the Jackson Township Assessor (Assessor) assessed the newly-constructed Phase I for the first time. In so

Federal law provides numerous tax incentives to encourage the production of affordable housing for low-income individuals, including the Low Income Housing Tax Credit (LIHTC) Program at issue here. See generally, 26 U.S.C.

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