concurring:
I concur in the result reached in the lead opinion and generally concur with its reasoning. I write separately to address two matters: (1) the applicable standard of review and (2) the importance of considering the duration of the federal contracts and the rental subsidies.
A. Standard of Review
The lead opinion concludes that the Commission’s decision to treat federally subsidized projects as a distinctly separate type of property and to consider the benefits and burdens of the federal contracts amounts to a finding of fact. As such, it would be entitled to “deference,” governed by a “substantial evidence standard on review,” Utah Code Ann. § 59-l-610(l)(a), rather than the “correction of error” standard applicable to conclusions of law. Utah Code Ann. § 59-1-610(l)(b).
If the lead opinion is correct, then presumably, a Commission decision to completely disregard the federal contracts and the subsidized rents would likewise have been entitled to deference. That is a more sobering proposition. The valuation swing that would have resulted from a complete disregard of contract rents is, by any measure, overwhelming. Using contract rents, the Commission put the values for the Glenbrook and Urey Belle Apartments at $1,100,000 and $750,000, respectively, whereas market rents supported appraisals only in the $500,000 range for each complex.
While the Commission has urged this court to construe the issues as factual in nature, its written findings of fact, conclusions of law, and final decision are not entirely consistent with this position. The Commission acknowledges that it was not called upon to resolve conflicts in the evidence; to the contrary, the evidence was essentially not in dispute. Rather, the Commission, as well as the parties, in reality, want legal guidance. In its findings, the Commission noted:
Both appraisals relied heavily upon the income approach in their final determination of fair market value, and both used many of the same comparable sales and comparable rents in their analysis.
While the appraisers disputed some points on one another’s appraisals, the real issue focuses on methodology, specifically how to value federally subsidized housing.
The parties in these cases ask the Tax Commission to determine whether or not the benefits and burdens related to federally subsidized rental housing contracts should be considered in determining the value of these properties for ad valorem tax purposes.
Both sides recognize that the issue is a legal one and certainly is of first impression for the Tax Commission and consequently, the Utah courts.
(Emphasis added.)
In its conclusions of law, the Commission opined that “there exists mass controversy and confusion over how to value federally subsidized housing.” It.supported this observation by contrasting the holdings in two cases on which the parties herein continue to rely. While the cases reach different conclusions, they are in accord in one respect, i.e., each treats the issue as being legal rather than factual in nature.
In Alliance Towers v. Stark County Board of Revision, 37 Ohio St.3d 16, 523 N.E.2d 826 (1988), relied upon herein by the landowners, the Ohio Supreme Court held that the fee simple estate is to be valued as if it were unencumbered, that the contract rents (federally subsidized) did not indicate the true value of the property and were not competent evidence thereof, and that the analysis by the county’s appraiser was flawed by reliance thereon. Id., 523 N.E.2d at 831-33. The opposite result was reached by the Supreme Court of Illinois in Kankakee County v. Property Tax Appeal Board, 131 Ill.2d 1, 136 Ill.Dec. 76, 544 N.E.2d 762 (1989). It held:
[W]e conclude that the PTAB erred as a matter of law in accepting a valuation that relied only on the rent the property would command in the open market of unsubsidized housing. A government subsidy contract that enhances the income-earning capacity of a particular piece of property must be considered in assessing the fair *119cash value of that property for taxation purposes.
Id., 136 Ill.Dec. at 83, 544 N.E.2d at 769 (emphasis added).
The Commission opted to go with the position advanced in Kankakee. Its decision, which followed the findings outlined above, has the clear sound and impact of a legal conclusion. The Commission’s response to what it termed a “legal” issue “of first impression” is as follows:
The Commission recognizes that the special federal financing programs offered through HUD section 8 and FmHA have created a distinctly separate Mnd of property that requires the assessing entity to value the property in question in light of the federal restraints and benefits.
On review, petitioners argue, “As a matter of law, this ruling is in error.” The lead opinion disregards the clear manner in which the issue is thus cast and miseharaeterizes the majority’s position. Petitioners urge this court to hold that the benefits and burdens of the federal contracts should be ignored and that the Commission should be precluded, as a matter of law, from considering them. The majority rejects that position. Rather than imposing a “straightjacket,” which Justice Russon apparently perceives, the majority frees the Commission from the one urged by petitioners. Moreover, the concept may be less applicable to the Commission than to a fee appraiser. In Redevelopment Agency of Salt Lake City v. Mitsui Investments, Inc., 522 P.2d 1370, 1373 (Utah 1974), which gave birth to the straightjacket language,1 the condemnor challenged the admissibility of an allegedly deficient appraisal prepared by the landowner’s appraiser. In extending wide latitude to the appraiser and allowing admission, the court reasoned that the alleged deficiencies could be exposed during cross-examination and the fact finder (jury) could determine the weight to be given. Id. In the instant case, the Commission is the fact finder as well as the decider of legal issues. It expresses more than an opinion to be weighed against the opinions of others; it performs a “quasi judicial” function, County Bd. of Equalization of Kane County v. State Tax Comm’n, 88 Utah 219, 223-24, 50 P.2d 418, 421 (1935), and its expressions become the law of the case. There is nothing in Mitsui or any other known precedent which would preclude this court from clarifying the parameters within which the Commission may employ its expertise. To the contrary, it is this court’s role to determine whether the statute, method, or rule of appraisement pursuant to which property has been valued will achieve the constitutional imperative of equal taxation. See Kennecott Corp. v. Salt Lake County, 702 P.2d 451, 455 (Utah 1985).
If the Commission’s ruling is judged by a correction of error standard, the result is the same as that reached in the lead opinion. The reasoning of the Kankakee court is clearly superior to that reflected in Alliance Tower. It recognizes the obvious: “A willing buyer would most certainly consider the guaranteed income rate set by the Federal government when determining the fair cash value of the property.” Kankakee, 136 Ill. Dec. at 83, 544 N.E.2d at 769. Utah law presumes that in arriving at “fair market value,” both buyer and seller would have “reasonable knowledge of the relevant facts.” Utah Code Ann. § 59-2-102(8). It follows that they would be expected to make reasonable decisions in light of this information, and accordingly, it is not credible to assume that they would be oblivious to the value-enhancing impact of significantly higher federally guaranteed rents.
Employing a different standard of review does not undermine the essential reasoning and analysis contained in the lead opinion. What is stated therein about the appraisal process continues to apply. Valuation is “ ‘an art, not a science,’ ” Beaver County v. Utah State Tax Comm’n, 916 P.2d 344, 355 (Utah 1996) (Beaver County I) (quoting Utah Ass’n of Counties v. Tax Comm’n, 895 P.2d 825, 828 (Utah 1995)); “any single formula” is inadequate, Rio Algom Corp. v. San Juan County, 681 P.2d 184, 188 (Utah 1984); and the so-called fee simple rule is not a rule of law, but a technique of appraisal generally but not always employed. The legal conclusion that the benefits and burdens of the *120federal contracts must be considered simply clarifies the framework within which the Commission has flexibility to employ its expertise.
Notwithstanding the necessity of flexibility in appraisal methodology and the deference to which the Commission is entitled, there must always be borders—outer limits—which circumscribe the permissible area of judgment and discretion and guard against appraisal approaches which may lead to aberrations. To hold otherwise would be to license a potentially capricious, irrational, or unreasonable result. For this reason, methodology cannot always, in every ease, be solely a question of fact. In Beaver County v. State Tax Commission, 919 P.2d 547 (Utah 1996) (Stewart, J., separate opinion) (Beaver County II), Justice Stewart perceives the same incorrect characterization which seems to me to exist in this ease. He states:
The Commission has developed significant and substantial expertise in dealing with highly complicated matters of valuation, which, as the majority opinion points out, do indeed involve matters of opinion and judgment. For that reason, it is appropriate for this Court to defer to the Commission’s expertise, as long as the methodology rests on a reasonable and consistent application of sound principles for determining fair market value. It is hardly appropriate, however, for this Court to act as if the Commission’s methodology is an issue of fact whereby this Court all but abandons its constitutional and statutory responsibilities of judicial review by treating that which is not a factual inquiry as if it were.
Id: at 556.2
The existence of limitations which move judicial review beyond the “substantial evidence” standard appears to have been recognized by our court of appeals in a case arising from the Industrial Commission. The court stated:
The decision of the Commission is entitled to deference because of the agency’s expertise. However, the decision is subject to judicial review to assure that the facts support the conclusions arrived at by the Commission and that the decision falls within the limits of reasonableness or rationality.
Gay Hill Field Serv. v. Board of Review, 750 P.2d 606, 608 (Utah.Ct.App.1988) (citations omitted) (emphasis added).
For the Commission to have refused to consider the benefits and burdens of the federal contracts, including the guaranteed rents, would have breached the outer limits of permissible appraisal methodology and would not, in my judgment, have been entitled to deference. That was the holding in Kankakee and should be adopted here. The fact that the Commission embraced the correct legal position does not change the fundamental nature of its ruling. The Commission’s decision to consider the federal contracts and to treat federally subsidized housing as a “distinctly separate kind of property” should be upheld because it is legally correct, not because the Commission is owed deference as to its factual findings.3
Moreover, it is not at all unlikely that the appraisers will come much closer to unanimity once the ground rules are clarified. Having one set of appraisers concluding that it is improper to consider the federal contracts and another set of appraisers proceeding from the opposite premise creates an irrecon*121cilable methodology conflict which cannot reasonably be expected to result in comparative appraisals that will be helpful to the Commission. It is appropriate for this court to resolve the conflict, as did the Kankakee court, by holding that the benefits and burdens of the federal contracts, including the contract rents, must be considered.4
I hasten to add that the obligation to consider contract rents is not tantamount to requiring their employment. The Commission would retain wide latitude to evaluate their impact and to devise and employ the methodology that will best achieve the intended objective: namely, the determination of “fair market value.” The Kankakee court succinctly noted this latitude, suggested a caution, and identified important factors the taxing authority should consider:
We do not mean to suggest that the tax assessor, in applying the income approach to valuation, is limited to and must accept the actual rental figure under the government subsidy contract as the sole measure of projected income. In most eases, such an approach would lead to a distorted measure of fair cash value. Factors such as the transferability of the subsidy contract, the remaining term of the contract and restrictions on the amount of return on capital investment would certainly affect the value of the property. A valuation approach which considers the subsidy income, but does not consider the negative aspects of a subsidy agreement upon the earning capacity of subsidized property, would be inappropriate. The taxing authority must weigh both the positive and the negative aspects of the subsidy agreement and adjust the actual income figure to accurately reflect the true earning capacity of the property in question.
136 Ill.Dec. at 83, 544 N.E.2d at 769 (emphasis added).
B. Duration of Contract Term
The emphasis added to the Kankakee court’s language quoted above highlights a potentially important area which was not addressed by the Tax Commission. Neither party adequately focused on the fact that the contract rents are guaranteed for only twenty years, whereas FHA financing on Urey Belle has a fifty-year life and HUD financing on Glenbrook has a forty-year life. Because the contract rents roughly double the market rate, a prudent buyer of either apartment building would want some assurance on the renewability of the subsidized arrangement. On this the record is sketchy. The general partner in each of the partnerships that owned the respective apartment complexes testified:
Generally, these are renewed, but there’s some negotiation in the 20 years.
The newer contracts they’re writing on these [similar] properties ... in the last two or three years, actually has [sic] a 50-year tie-in, so its the useful life of the property....
In voting to affirm, I indulge the assumption of renewability. To the extent that there is any uncertainty in this regard, it could be expected to influence what a prudent buyer would pay and a seller’s assessment of what it had to sell. Moreover, the effect would not await the expiration of the twenty-year contract term because a “knowledgeable” buyer, as the law presumes, see Utah Code Ann. § 59-2-102(8), would factor in the uncertainty at whatever time the negotiations occurred. The influence of a federal contract, including agreed rental rates, corresponds directly with the remaining life of such contract. Further, expiration of the contract term short of the anticipated economic life of the assessed property is relevant to value whether the contract rents are more or less than market rents. In the former, a prudent buyer would ask, How *122much longer are the subsidies guaranteed? in the latter, When will the property be set free to command market rates? That which is a value-enhancer in the Richfield market may be a value-depressant in other markets.5
The Urey Bell Apartments were constructed in 1980; the Glenbrook in 1983. The existing contracts will expire respectively in four and seven years. In contrast, the anticipated economic life of the projects will likely continue for some three decades or more. The Commission’s appraisals for the years in question were level.6 Such necessarily assumes an uninterrupted continuation of the stream of income on which the appraisals were premised. This may not accurately project the future, but in the absence of any real treatment by the parties or the Commission, no relief can be given in this appeal.7
C. Conclusion
Since the Commission reached the proper legal conclusion regarding the necessity of considering the federal contracts, the issues focus on the adequacy of its factual findings. I agree with the lead opinion’s conclusion that the property owners failed to demonstrate that Sevier County’s assessments inadequately addressed the benefits and burdens of the federal contracts which had been properly raised. The actual factual findings are supported by substantial evidence and are entitled to deference. I further agree with the opinion’s rejection of a claim of a constitutional violation. That is a correct legal conclusion.
Accordingly, I agree that the Commission’s decision should be affirmed.
DURHAM, J., concurs.
Having disqualified himself, STEWART, Associate C.J., does not participate herein; McIFF, District Judge, sat.
. The concept was applied in similar circumstances and for the same basic purpose in Department of Transportation v. Jones, 694 P.2d 1031, 1035 (Utah 1984).
. Whether Beaver County II was correctly decided and whether the issues therein were properly characterized is not germane to this case. The language from the separate opinion is cited solely to buttress my conclusion that the Commission's "methodology” is not without some limitations which are legally imposed and concerning which a correction of error standard is applicable.
. The lead opinion should consider inconsistencies with the stance taken by this court in review of decisions from other state agencies. For example, in Stewart v. Public Service Commission, 885 P.2d 759, 770 (Utah 1994), the court held, "The factors that the Commission may legitimately take into account in determining a rate of return are questions of law." (Emphasis added.) There may be legitimate distinctions between the approach to "rate” fixing by the Public Service Commission and the ascertainment of "fair market value” by the Tax Commission, but in either case, there simply must be legal boundaries which cannot be overstepped in the employment of expertise and the exercise of discretion.
. The lead opinion misconstrues the thrust and future effect of this requirement endorsed by a majority of the court. Justice Russon poses the question, "But what if expert testimony indicated that consideration of contract rents would distort the fair market value of the property ... ?” The question is ill-put since it assumes that the mere act of considering requires acceptance. The answer to the question is that if after fair consideration it appears that contract rents distort rather than aid the inquiry, then the Commission’s factual findings should so reflect.
. If market rents exceed contract rents, value may be compromised according to the number of years that the owner is "locked-in” to the lower rates. The degree of impact would depend upon an analysis of all the benefits and burdens of the federal contract and could be expected to erode as the contract moved toward expiration.
. Urey Bell was appraised at $750,000 for 1992 and 1993; Glenbrook was appraised at $1,100,00 for 1991, 1992, and 1993.
.Though providing no relief for years past, the analysis is relevant to the discharge of the Counfy's ongoing assessment responsibility. It responds to the request for legal guidance which is inherent in the Commission's decision and in the presentations of the parties addressed therein.