CHARLES A. & NANCY J. FRANZ,	)
	)
Complainants,	)
	)
v.	)		Appeal Number 03-20099
	)
ED BUSHMEYER, ASSESSOR,	)
ST. LOUIS CITY, MISSOURI,	)
	)
Respondent.	)

Decision of the St. Louis City Board of Equalization sustaining the assessment made by the Assessor, AFFIRMED, true value in money for the subject property for tax years 2003 and 2004 set at $101,000, assessed value of $19,190.

Complainant, Charles A. Franz, appeared pro se.

Respondent appeared by Counsel, Carl W. Yates III, Assistant City Counselor.

Case heard and decided by Hearing Officer, W. B. Tichenor.

The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2003.

Complainant appeals the decision of the St. Louis City Board of Equalization which sustained the valuation of the subject property. The Assessor determined an appraised value of $101,000 (assessed value of $19,190, as residential property). Complainants proposed a value of $81,000 - $91,000 on their Complaint for Review of Assessment. A hearing was conducted on December 9, 2003, at the St. Louis City Hall, Assessor=s Conference Room, St. Louis, Missouri.

The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.

Mr. Franz testified in his own behalf. Mr. Franz did not challenge the appraised value set on his home by the Assessor. His claim related to the value of his property in relation to four other properties on the subject street. It was the contention of Mr. Franz that these four other properties were valued lower than his property. Exhibit A was received into evidence on behalf of Complainants. Exhibit A consisted of data sheets from the Assessor=s records showing the current appraised, assessed and prior assessed value on the subject and the properties at 6405, 6409, 6413 and 6400 Lavernell Court.

Respondent placed into evidence the testimony of Mr. David Donald, appraiser for St. Louis City. The appraiser testified as to his appraisal of the subject property. The Appraisal Report, Exhibit 1, of Mr. Donald was received into evidence. Mr. Donald arrived at an opinion of value for the subject property of $113,000 based upon a sales comparison approach to value. In performing his sales comparison analysis, the appraiser relied upon the sales of three properties which he deemed to be comparable to the subject property. Exhibit 1 was not offered to advocate an increase in the appraised value of the subject, but only to support the assessor=s original valuation and the Board decision.

Exhibit 2 was also received into evidence on behalf of Respondent. Exhibit 2 was an analysis of the value per square foot of living area for each property on Lavernell Court as determined by the Assessor for the 2003 assessment cycle. This analysis showed that the living area of the homes on Lavernell ranged from 954 to 1,463 square feet. The market values determined by the Assessor ranged from $95,100 to $124,100. The per square foot of living area values ranged from $75.65 (the subject) to $104.89.

1. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission from the decision of the St. Louis City Board of Equalization.

2. The subject property is located at 6401 Lavernell Court, St. Louis, Missouri. The property is identified by parcel number 63700000600. The property consists of a 7,985 square foot lot improved by a one-story brick single-family residence containing approximately 1,335 square feet of living area. The Assessor=s records do not indicate a room count and the appraiser was denied an interior inspection to determine a room count or bedroom count. The house is approximately 51 years old, with a basement and no garage or car-port. Exhibit 1.

3. There was no evidence of new construction and improvement from January 1, 2003, to the hearing date that would require a change in the valuation of the subject for the 2004 tax year.

4. Complainant=s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the true value in money as of January 1, 2003, to be $81,000 or $91,000, as proposed on the Complaint for Review of Assessment. Complainant did not challenge the value of $101,000 determined by the Assessor to be the fair market value of the subject.

5. The properties relied upon by Respondent=s appraiser in performing his appraisal were comparable to the subject property for the purpose of making a determination of value. The properties were located within one block of the subject. Each sale property sold at a time relevant to the tax date of January 1, 2003. The sale properties were similar to the subject in location, age, style, type of construction, condition, room count, bedrooms and bath rooms, living area, and other amenities. Exhibit 1.

6. The comparables were described as follows (Exhibit 1):

Comparable 1 (6409 Lavernell Court - second house to the southwest of the subject) sold in June, 2001 for $101,000. This property consists of a 6,250 square foot lot improved by a one- story brick single-family house, approximately 50 years old, with 1,179 square feet of living area.

Comparable 2 (6429 Lavernell Court - located on cul de sac at end of the subject street) sold in May, 2002 for $115,000. This property consists of a 8,223 square foot lot improved by a one-story brick single-family house, approximately 50 years old, with 1,168 square feet of living area.

Comparable 3 (6408 Printz - 1 block east of subject) sold in February, 2002 for $119,000. This property consists of a 5,652 square foot lot improved by a one-story brick single-family house, approximately 50 years old, with 1,257 square feet of living area.

7. The appraiser made various adjustments to the comparable properties for differences which existed between the subject and each comparable. The adjustments made were appropriate to account for the differences between the given sale properties and the subject.

8. The net adjustments for Comparable 1 amounted to +$100 or less than 1% of the sales price. The net adjustments for Comparable 2 amounted to +$1,200 or less than 1% of the sales price. The net adjustments for Comparable 3 amounted to -$1,900 or 1.6% of the sales price.

9. The adjusted sales prices for the comparables calculated to $101,100, $113,800 and $117,100, respectively. The appraiser concluded on a $113,000 value which calculated to a value per square foot of $85,28 compared with the sales prices per square foot of living area for the comparables of $85.66, $98.45 and $94.67.

10. Respondent was required to meet a standard of clear, convincing and cogent evidence in this appeal, under the provisions of Section 137.115, RSMo, as he was seeking to sustain the original valuation presumed to have been made by a computer, computer-assisted method or a computer program.

11. Respondent=s evidence met the standard of clear, convincing and cogent to establish the value of the subject, as of January 1, 2003, to be $101,000.

The Commission has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious. Article X, section 14, Mo. Const. of 1945; Sections 138.430, 138.431, RSMo. The hearing officer shall issue a decision and order affirming, modifying or reversing the determination of the board of equalization, and correcting any assessment which is unlawful, unfair, improper, arbitrary, or capricious. Section 138.431.4, RSMo.

There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization. Hermel, Inc. v. STC, 564 S.W.2d 888, 895 (Mo. banc 1978); Chicago, Burlington & Quincy Railroad Co. v. STC, 436 S.W.2d 650, 656 (Mo. 1968); May Department Stores Co. v. STC, 308 S.W.2d 748, 759 (Mo. 1958).

The presumption in favor of the Board is not evidence. A presumption simply accepts something as true without any substantial proof to the contrary. In an evidentiary hearing before the Commission, the valuation determined by the Board, even if simply to sustain the value made by the Assessor (which is not presumed to be correct), is accepted as true only until and so long as there is no substantial evidence to the contrary.

There is no presumption that the assessor=s valuation is correct. Section 138.431.3, RSMo.

Section 137.115, RSMo 1994, requires that property be assessed based upon its true value in money which is defined as the price a property would bring when offered for sale by one willing or desirous to sell and bought by one who is willing or desirous to purchase but who is not compelled to do so. St. Joe Minerals Corp. v. State Tax Commission, 854 S.W.2d 526, 529 (Mo. App. E.D. 1993); Missouri Baptist Children=s Home v. State Tax Commission, 867 S.W.2d 510, 512 (Mo. banc 1993). It is the fair market value of the subject property on the valuation date. Hermel, Inc. v. State Tax Commission, 564 S.W.2d 888, 897 (Mo. banc 1978).

Market value is the most probable price in terms of money which a property should bring in competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeable and assuming the price is not affected by undue stimulus.

Implicit in this definition is the consummation of a sale as of a specific date and the passing of title from seller to buyer under conditions whereby:

1. Buyer and seller are typically motivated.

2. Both parties are well informed and well advised, and each acting in what they consider their own best interests.

3. A reasonable time is allowed for exposure in the open market.

4. Payment is made in cash or its equivalent.

5. Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.

6. The price represents a normal consideration for the property sold unaffected by special financing amounts and/or terms, services, fees, costs, or credits incurred in the transaction.

Real Estate Appraisal Terminology, Society of Real Estate Appraisers, Revised Edition, 1984; See also, Real Estate Valuation in Litigation, J. D. Eaton, M.A.I., American Institute of Real Estate Appraisers, 1982, pp. 4-5; Property Appraisal and Assessment Administration, International Association of Assessing Officers, 1990, pp. 79-80; Uniform Standards of Professional Appraisal Practice, Glossary; Exhibit 1.

In order to investigate appeals filed with the Commission, the Hearing Officer has the duty to inquire of the owner of the property or of any other party to the appeal regarding any matter or issue relevant to the valuation, subclassification or assessment of the property. The Hearing Officer=s decision regarding the assessment or valuation of the property may be based solely upon its inquiry and any evidence presented by the parties, or based solely upon evidence presented by the parties. Section 138.430.2, RSMo.

The Hearing Officer is not bound by any single formula, rule or method in determining true value in money, but is free to consider all pertinent facts and estimates and give them such weight as reasonably they may be deemed entitled. The relative weight to be accorded any relevant factor in a particular case is for the Hearing Officer to decide. St. Louis County v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977); St. Louis County v. STC, 515 S.W.2d 446, 450 (Mo. 1974); Chicago, Burlington & Quincy Railroad Company v. STC, 436 S.W.2d 650 (Mo. 1968).

The Hearing Officer as the trier of fact may consider the testimony of an expert witness and give it as much weight and credit as he may deem it entitled to when viewed in connection with all other circumstances. The Hearing Officer is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe all or none of the expert=s testimony and accept it in part or reject it in part. St. Louis County v. Boatmen=s Trust Co., 857 S.W.2d 453, 457 (Mo. App. E.D. 1993); Vincent by Vincent v. Johnson, 833 S.W.2d 859, 865 (Mo. 1992); Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. 1991); Curnow v. Sloan, 625 S.W.2d 605, 607 (Mo. banc 1981).

If specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert on that subject, by knowledge, skill, experience, training, or education, may testify thereto.

The facts or data upon which an expert bases an opinion or inference may be those perceived by or made known to the expert at or before the hearing and must be of a type reasonably relied upon by experts in the field in forming opinions or inferences upon the subject and must be otherwise reliable, the facts or data need not be admissible in evidence. Section 490.065, RSMo; Courtroom Handbook on Missouri Evidence, Wm. A. Schroeder, Sections 702-505, pp. 325-350; Wulfing v. Kansas City Southern Industries, Inc., 842 S.W.2d 133 (Mo. App. E.D. 1992).

The Respondent has imposed upon him by the provisions of Section 137.115.1, RSMo, the burden of proof to present clear, convincing and cogent evidence to sustain a valuation on residential property which is made by a computer, computer-assisted method or a computer program. There is a presumption in this appeal that the original valuation, which was sustained by the Board of Equalization, was made by a computer, computer-assisted method or a computer program. There was no evidence to rebut the presumption, therefore, in order to sustain the valuation of the subject property at $101,000, appraised value, Respondent=s evidence must come within the guidelines established by the legislature and must clearly and convincingly persuade the Hearing Officer as to the value sought to be sustained.

The statutory guidelines for evidence to meet the standard of clear, convincing and cogent include the following:

(1) The findings of the assessor based on an appraisal of the property by generally accepted appraisal techniques; and

(2) The purchase prices from sales of at least three comparable properties and the address or location thereof. As used in this paragraph, the word comparable means that:

(a) Such sale was closed at a date relevant to the property valuation; and

(b) Such properties are not more than one mile from the site of the disputed property, except where no similar properties exist within one mile of the disputed property, the nearest comparable property shall be used. Such property shall be within five hundred square feet in size of the disputed property, and resemble the disputed property in age, floor plan, number of rooms, and other relevant characteristics.

Section 137.115.1(1) & (2).

Clear, cogent and convincing evidence is that evidence which clearly convinces the trier of fact of the affirmative proposition to be proved. It does not mean that there may not be contrary evidence. Grissum v. Reesman, 505 S.W.2d 81, 85, 86 (Mo. Div. 2, 1974). The quality of proof, to be clear and convincing must be more than a mere preponderance but does not require beyond a reasonable doubt. 30 AmJur2d. 345-346, Evidence section 1167. AFor evidence to be clear and convincing, it must instantly tilt the scales in the affirmative when weighed against the evidence in opposition and the fact finder=s mind is left with an abiding conviction that the evidence is true.@ Matter of O=Brien, 600 S.W.2d 695, 697 (Mo. App. 1980).

In order to prevail, Complainants must present an opinion of market value and substantial and persuasive evidence that the proposed value is indicative of the market value of the subject property on January 1, 2003. Daly v. P.D. George Co., 77 S.W.3d 645, 651 (Mo. App. 2002); Hermel, Inc. v. State Tax Commission, 564 S.W.2d 888, at 897. Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. See, Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959). Persuasive evidence is that evidence which has sufficient weight and probative value to convince the trier of fact. The persuasiveness of evidence does not depend on the quantity or amount thereof but on its effect in inducing belief. Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975). See also, Westwood Partnership v. Gogarty, 103 S.W.3d 152 (Mo. App. E.D. 2003); Daly v. P. D. George Co., 77 S.W.3d 645 (Mo. App. E.D. 2002).

The owner of property is generally held competent to testify to its reasonable market value. Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970). The owner=s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation. Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965).

Missouri courts have approved the comparable sales or market approach, the cost approach (replacement or construction) and the income approach as recognized methods of arriving at fair market value. St. Joe Minerals Corp. v. STC, 854 S.W.2d 526, 529 (App. E.D. 1993); Aspenhof Corp. v. STC, 789 S.W.2d 867, 869 (App. E.D. 1990); Quincy Soybean Company, Inc., v. Lowe, 773 S.W.2d 503, 504 (App. E.D. 1989), citing Del-Mar Redevelopment Corp v. Associated Garages, Inc., 726 S.W.2d 866, 869 (App. E.D. 1987); and State ex rel. State Highway Comm=n v. Southern Dev. Co., 509 S.W.2d 18, 27 (Mo. Div. 2 1974).

In any case in St. Louis City where the assessor presents evidence which indicates a valuation higher than the value finally determined by the assessor or the value determined by the board of equalization, whichever is higher, for that assessment period, such evidence will only be received for the purpose of sustaining the assessor=s or board=s valuation, and not for increasing the valuation of the property under appeal. Section 138.060, RSMo; 12 CSR 30-3.075.

Discrimination

In order to obtain a reduction in assessed value based upon discrimination, the Complainants must (1) prove the true value in money of their property on January 1, 2003. Koplar v. State Tax Commission, 321 S.W.2d 686, 690 (Mo. 1959); and (2) show an intentional plan of discrimination by the assessing officials resulting in an assessment of that property at a greater percentage of value than other property, generally, within the same class within the same taxing jurisdiction. Koplar, supra, at 695.

Complainants must first establish the market value of their property in order to determine the percentage of true value at which it is being assessed. Next, they must establish the true value of the other properties generally which they claim are assessed at a lower percentage of true value. Evidence of value and assessments of a few properties does not prove discrimination. Substantial evidence must show that all other property in the same class, generally, is actually undervalued. State ex rel. Plantz v. State Tax Commission, 384 S.W.2d 565, 568 (Mo. 1964). Then they must compare the ratio of assessed value to true value for both their property and the comparable properties to establish that their property is being assessed at a higher percentage of value. This difference in ratios must be shown to be grossly excessive. Savage v. State Tax Commission of Missouri, 722 S.W.2d 72, 79 (Mo. banc 1986). No other methodology is sufficient to establish discrimination. Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696 (Mo. 1958).

Complainant did not challenge the fact that the subject property had a fair market value of $101,000 as determined by the Assessor. Respondent=s evidence was clear and convincing to so establish. Accordingly, the value of $101,000 must be affirmed.

The claim of Complainant is for all intents and purposes a claim of discrimination. Mr. Franz did not assert that the fair market value of the subject property should not be $101,000. He simply claimed that in comparison to neighboring properties his home was overvalued. This methodology or approach to valuation in appeals before the Commission is not recognized by any court decision in Missouri. Therefore, the argument advanced by Mr. Franz has no probative value to support a reduction in the value of the subject property.

Even Mr. Franz=s exhibit fails to establish that the subject property is overvalued when compared to the four properties which he selected from off his street. When a comparison is made based on the per square foot values determined by the Assessor for the subject and the four properties referenced by Exhibit A, the only conclusion that can be reached is that the subject property has the lowest per square foot of living area value of any of these properties.

The subject has 1,335 square feet of living area and is valued at $101,000 or $75.65 per square foot of living area. The property at 6405 is 235 square feet smaller than the subject. The assessor valued it at $95,100 or $86.45 per square foot of living area. The property at 6409 is only 156 square feet smaller than the subject. It is valued at $100,500 (only $500 less than the subject) or at $85.25 per square foot. The property at 6413 only has 954 square feet of living area or 381 square feet smaller than the subject. It is valued at $82,800 or $86.79 per square foot. The property at 6400 is 215 square feet smaller than the subject. It is value at $98,200 or $87.67 per square foot. The conclusion is that of all the houses on Lavernell Court the subject has the lowest per square foot of living area value. It is the third largest house on the street. Complainant=s evidence failed to establish that in comparison the other houses on Lavernell Court that the subject was overvalued.

Where there is a claim of discrimination based upon a lack of valuation consistency, Complainants have the burden to prove:

1. The level of assessment for the subject property in 2003. This is done by independently determining the market value of the subject property and dividing the market value into the assessed value of the property as determined by the assessor=s office. However, in this instance, Complainants conceded that the Assessor has placed the appropriate fair market value on the subject property.

2. The average level of assessment for residential property in St. Louis City in 2003. This is done by (a) independently determining the market value of a representative sample of residential properties in St. Louis City; (b) determining the assessed value placed on the properties by the assessor=s office for the relevant year; (c) dividing the assessed value by the market value to determine the level of assessment for each property in the sample; and (d) determining the mean and median of the results.

3. That the disparity between (1) and (2) is grossly excessive. The difference between the actual assessment level of the subject property and the average level of assessment for all residential property, taken from a sufficient representative sample in St. Louis City must demonstrate a disparity that is grossly excessive. Savage v. State Tax Commission of Missouri, 722 S.W.2d 72, 79 (Mo. banc 1986).

Complainants= discrimination claim fails because they failed to establish that they are being assessed at a higher percentage of market value that any other property. The four properties on the subject street presented by Complainants in Exhibit A do not constitute a representative sample of residential property in St. Louis City or even on the subject street. Mr. Franz selective presented the four properties on the subject street that are have the lowest appraised values. Incidentally, these four properties are all smaller in living area than the subject. The four properties on which Mr. Franz basis his claim of unequal valuation are being assessed at nineteen percent of the appraised value determined by the Assessor. Mr. Franz presented no evidence to establish that any of the four properties were not being valued at market value. He did not challenge in any manner that the four properties were not appraised at fair market value.

An analysis of all of the Lavernell Court properties shows that the average appraised value is $103,675 or 2.7% above the value of the subject. The average per square foot of living area value is $88.07 or 16.5% above the per square foot value of the subject. Therefore, in comparing all of the other properties on Lavernell Court to the subject, it is not overvalued compared to the other homes either on a total appraised value or on a per square foot of living area value.

When the subject is compared to the four Lavernell Court properties closest in living area to the subject, the comparison again demonstrates the subject is not overvalued. The house at 6408 is only 45 square feet larger than the subject. The 6424 house is only 95 square feet smaller than the subject. The subject is 104 square feet larger than the 6404 house and 128 square feet smaller than the 6412 house. The average of these homes is 1339.75 or only 4.75 square feet larger than Complainants= home.

These four properties are valued respectively at $107,100, $102,500, $108,300 and $124,100. This is an average of $110,500. Therefore, when the subject is compared to the four homes closest in living area to the subject, it is 9.5% less in overall value then the average appraised value of the four homes. The per square foot living area average value for these four homes is $82.49, or 9.1% more than the subject.

The owner=s opinion of overvaluation based on a selective comparison to the four smallest homes on the subject street is not a recognized methodology for either determining fair market value or establishing a claim of discrimination. Therefore, the owner=s opinion that Complainants= property is overvalued has no probative value because it is founded on improper elements and an improper foundation. Even assuming that such a type of comparison were recognized as a methodology to establish an unequal assessment, it would fail in this instance. The analysis demonstrated above from the data provided in Exhibit 2 clearly establishes that Complainants= property is not overvalued when compared to the other properties on the subject street.

Complainants, as the moving parties seeking affirmative relief bear the burden of proving the vital elements of their case. Reeves v. Snider, 115 S.W.3d 375, 379 (Mo. App. 2003); Westwood P=ship v. Gogarty, 103 S.W.3d 152, 181 (Mo. App. 2003).

The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for St. Louis City for the subject tax day is AFFIRMED.

The assessed value for the subject property for tax years 2003 and 2004 is set at $19,190.

A party may file with the Commission an application for review of this decision within thirty (30) days of the mailing of such decision. The application shall contain specific grounds upon which it is claimed the decision is erroneous. Failure to state specific facts or law upon which the appeal is based will result in summary denial. Section 138.432, RSMo 1994.

If an application for review of this decision is made to the Commission, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the Commission. If no application for review is received by the Commission within thirty (30) days, this decision and order is deemed final and the Collector of St. Louis City, as well as the collectors of all affected political subdivisions therein, shall disburse the protested taxes presently in an escrow account in accord with the decision on the underlying assessment in this appeal. If any or all protested taxes have been disbursed pursuant to Section 139.031(8), RSMo, either party may apply to the circuit court having jurisdiction of the cause for disposition of the protested taxes held by the taxing authority.

Any Finding of Fact which is a Conclusion of Law or Decision shall be so deemed. Any Decision which is a Finding of Fact or Conclusion of Law shall be so deemed.

SO ORDERED December 16, 2003.

STATE TAX COMMISSION OF MISSOURI

W. B. Tichenor

Hearing Officer