RAYMOND & YVONNE KOSTER,	)
	)
Complainants,	)
	)
v.	)		Appeal Number 03-41501
	)
MARSHA PEERY, ASSESSOR,	)
AUDRAIN COUNTY, MISSOURI,	)
	)
Respondent.	)

Decision of the Audrain County 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 $69,960, assessed value of $13,290.

Complainants appeared pro se.

Respondent appeared pro se.

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

The Commission takes this appeal to determine whether the Assessor discriminated against the Complainants in her assessment of the subject land.

Complainants appeal the decision of the Audrain County Board of Equalization which sustained the valuation of the subject property. The Assessor determined an appraised value of $69,960 (assessed value of $13,290, as residential property). Complainants did not challenge the valuation of the subject property by the Assessor. Complainants asserted that the Assessor had discriminated against them by not valuing a neighboring property at the same land value as the subject property. A hearing was conducted on November 19, 2003, at the Audrain County Courthouse, Mexico, Missouri.

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

Complainant Raymond T. Koster testified on behalf of Complainants. Mr. Koster alleged discrimination due to the fact that his lot had been valued at its purchase price, but an adjoining tract of land was not valued at a similar value or increased in value to reflect the same value as Mr. Koster=s land. The following exhibits were received into evidence on behalf of Complainants:

Exhibit A     Map showing subject property and two tracts of land on either side of the subject.

Exhibit B    Buyer=s Statement on the purchase of the subject tract by Complainants in 1997.

Exhibit C    Deed conveying a 105 x 30 foot tract to Complainants.

Exhibit D    Calculation of per square foot area of the subject and the two tracts adjoining the subject.

Respondent testified in her own behalf. Ms. Peery prepared a valuation report which provided information as to her valuation on the subject property and two adjoining tracts which were the basis of Complainants= discrimination claim. The valuation report, Exhibit 1 was received into evidence.

1. Jurisdiction over this appeal is proper. Complainants timely appealed to the State Tax Commission from the decision of the Audrain County Board of Equalization.

2. The subject property is located at 310 N. Western, Laddonia, Missouri. It is identified by parcel number 05-00339.001. The property consists of a 105 by 120 foot tract of land improved by a residence.

3. Complainants did not challenge the fair market value placed on the subject property by the Assessor. The appeal was solely on the claim of discrimination.

4. Complainants= evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish that the Assessor had discriminated against Complainants in her assessment of the subject property.

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.

Board of Equalization Presumption

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).

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 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 a witness and give it as much weight and credit as he may deem it entitled to when viewed in connection with all other circumstances. 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).

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).

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.

2. The average level of assessment for residential property in Audrain County in 2003. This is done by (a) independently determining the market value of a representative sample of residential properties in Audrain County; (b) determining the assessed value placed on the property 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 Audrain County 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 the market value of their property. Without establishing their market value, they cannot establish their assessment ratio. Without establishing their ratio, they cannot establish that they are being assessed at a higher percentage of market value that any other property.

Complainants are willing to simply assume that the $5,500 value represents the fair market value of their lot. Of course, the assessment made by the Assessor on this tract is at 19% of that value. However, by Complainants= own evidence they had to purchase an additional 3,150 square feet of land at $750 or approximately 23.8 cents per square foot. It is not established by Complainants if their 15,750 square foot lot actually has a fair market value of only $5,500 or if it should be valued at $6,250, or at some other value based of on more recent sales of lots in Laddonia. This failure to establish the fair market value of the subject property or the subject lot prevents the Complainants from establishing whether their property is actually being assessed at 19% of its fair market value.

However, even if Complainants had established their market value, they have not demonstrated that a statistically significant number of other residential properties within Audrain County are being assessed at a lower ratio of market value than their property. Complainants= claim of discrimination is based upon one property which is classified as a mix use property as residential and commercial. Complainants did not claim that their property was over valued. They raised the issue of discrimination based upon essentially two simple facts. These facts are (1) The subject tract was purchased as vacant land for $5,500 in 1997 and the Assessor has assessed the subject land based on that value; and (2) the Assessor did not increase the value of the adjoining tract of land to reflect a value in accordance with the sale of the subject to Complainants.

The purchase price of the Complainants= 105 by 120 foot tract calculates to approximately 42.6 cents per square foot. Complainants assert that the adjoining tract of land, owned by a Mr. Todd, from whom they purchased their lot, should have been increased in value to represent a similar per square foot value. This is the total basis for their claim of discrimination.

Comparison to a single property does not establish a claim of discrimination. The assessment on a single mixed use property does not present a statistically significant number of residential properties in Audrain County to establish that Complainants are being assessed at a greater percentage of fair market value than the average assessment ratio for residential property in the county.

Complainants did not establish what the fair market value of the Todd property which they claim is undervalued in comparison to the subject land. Therefore, there is no way to determine that the residential portion of the Todd property is not being assessed at 19% of its fair market value. The Todd property suffers from various factors related to is location and the number of commercial buildings on parts of the entire tract. These all appear to detract from its value as a property for residential use or development. The 1997 sale of the vacant lot to the Complainants did not establish that the entire Todd tract should be valued at the same per square foot value as the price paid by Complainants.

There is one additional fatal defect to Complainants= claim of discrimination. This defect is attempting to make a discrimination claim based solely upon alleged land values for improved properties. Assessors assign a land value to real property when performing a mass valuation cost approach and then calculate the depreciated value of improvements (house, etc.) to arrive at the indicated value for the entire property. However, this does not give rise to a claim of discrimination for an improved property based upon the land value alone. The fair market value of the subject property as of January, 2003, must be determined based upon how the real property existed at that time, with its improvements.

There is no evidence in this record to establish that Complainants are not being assessed at 19% of the fair market value of their property, since they concede that the value assigned by the Assessor of $69,960 represents fair market value. There is no evidence to establish that the average assessment of residential property in Audrain County is at some percentage other than 19%. Accordingly, Complainants failed to establish an intentional plan of discrimination by the Assessor in the assessment of their property.

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

The assessed value for the subject property for tax years 2003 and 2004 is set at $13,290.

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 Audrain County, 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 10, 2003.

STATE TAX COMMISSION OF MISSOURI

W. B. Tichenor

Hearing Officer