ROBERT W. & CONNIE M. DAVIDSON,	)
	)
Complainants,	)
	)
v.	)		Appeal Number 01-10379
	)
PHILIP A. MUEHLHEAUSLER, ,	)
ACTING ASSESSOR,	)
ST. LOUIS COUNTY, MISSOURI,	)
	)
Respondent.	)

Decision of the St. Louis County Board of Equalization reducing the assessment made by the Assessor, SET ASIDE, Hearing Officer finds true value in money for the subject property for tax years 2001 and 2002 to be $235,370, assessed value of $44,720.

Complainants did not appear.

Respondent appeared by Counsel, Paula J. Lemerman, Associate County Counselor.

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

The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2001.

Complainants appeal the decision of the St. Louis County Board of Equalization which reduced the valuation of the subject property. The Assessor determined an appraised value of $235,370 (assessed value of $44,720, as residential property). The Board reduced the value to $205,000 (assessed value of $38,950). Complainant proposed a value of $170,000 (assessed value of $32,300). Respondent proposed a value of $235,370 (assessed value of $44,720). A hearing was conducted on May 22, 2003, at the St. Louis County Government Center, Clayton, Missouri, to receive the Respondent=s exhibits and the testimony of Respondent=s appraiser. A second hearing was scheduled for July 10, 2003, to receive testimony from Complainants. Complainants were unable to appear due to a personal emergency.

1. September 5, 2001 - Complaint for Review of Assessment filed with the Commission.

2. September 20, 2001 - Filing of Complaint acknowledged.

3. September 28, 2001 - Order setting Prehearing Conference for 11:30 a.m., November 27, 2001.

4. November 27, 2001 - Order setting Evidentiary Hearing for 9:30 a.m., February 20, 2003.

5. February 26, 2002 - Order setting March 15, 2002 as date for filing of stipulation, as Counsel for Respondent advised Chief Hearing Officer on February 20, 2002 the case has been settled by stipulation.

6. March 19, 2002 - Order setting case for Evidentiary Hearing at 9:00 a.m., June 11, 2002, since no stipulation was filed as ordered.

7. June 12, 2002 - Order giving Complainants until and including July 1, 2002 to advise in writing if they wish to proceed with an Evidentiary Hearing or dismiss the appeal.

8. July 1, 2002 - Letter from Complainants requesting an Evidentiary Hearing.

9. July 30, 2002 - Order setting Evidentiary Hearing for 9:00 a.m., November 21, 2002. Parties advised as an alternative to the Evidentiary Hearing that they could submit the case on documents and a written statement as to opinion of value and basis for said opinion.

10. November 7, 2002 - Letter from Complainants requesting an continuance of the November 21st Evidentiary Hearing due to work conflicts (out of country until late December).

11. November 13, 2002 - Order canceling November 21st hearing and advising that the case would be set for evidentiary hearing at the conclusion of all pending 2001 residential hearings in St. Louis County.

12. January 29, 2003 - Order setting May 13, 2002 as date for Evidentiary Hearing.

13. May 5, 2003 - Letter from Complainants requesting a continuance of Evidentiary Hearing due to being out of town on business.

14. May 9, 2003 - Order canceling Evidentiary Hearing for May 13 and ordering an exchange of exhibits. Parties were ordered to exchange and file with the Commission a copy of the exhibits that were to be presented in their case in chief. Case was set for Evidentiary Hearing on May 22, 2003.

15. May 21, 2003 - Letter from Complainants requesting continuance of the Evidentiary Hearing until the week of July 7-11, due to Mr. Davidson being out of town on May 22, 2003.

16. May 21, 2003 - Order setting May 22, 2003 as date for taking testimony of Respondent=s appraiser due to the appraiser would not be available after May 22nd to testify as she was leaving employment with Respondent. Order gave Complainants until June 12, 2003 to file with the Commission a written statement setting forth their opinion of value and the basis therefor, with copies of all documents which support their opinion of value and advising that the Hearing Officer would decide the case, unless there was objection, based on Respondent=s Exhibits, testimony of Respondent=s appraiser and the statement and documents to be filed by Complainants on or before June 12.

17. May 22, 2003 - Evidentiary Hearing held to take testimony of Respondent=s appraiser and receive into evidence Respondent=s exhibits.

18. June 13, 2003 - Letter from Complainants objecting to the Hearing Officer entering a decision based upon Respondent=s exhibits, testimony of Respondent=s appraiser and written statement of Complainants and requesting an Evidentiary Hearing during the period from July 7-11, 2003 to present Complainants= Athoughts on the condition of the property, ...@

19. June 17, 2003 - Order setting appeal for Evidentiary Hearing at 10:00 a.m., July 10, 2003.

20. July 10, 2003 - Fax message from Complainants that due to illness of Mr. Davidson=s mother he would be unable to attend the Evidentiary Hearing. Faxed letter requested that the Evidentiary Hearing be canceled and for the Hearing Officer to Atake note of my comments submitted earlier in my June 12, 2003 letter.@

*****

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

Complainants= evidence consists of a statement made in their letter of June 12 essentially that the opinion of value for the property being $170,000 was based on a meeting with Bob Burns (sic - Bruns) at which time, Mr. Davidson asserts that Mr. Bruns Aagreed this property was worth less than $170,000.@ Mr. Davidson expressed his opinion that the property is in poor condition and that a street runs through the property. Mr. Davidson=s statement references cracking foundation, septic concerns, grading for drain pipe, digging up of the driveway. No other evidence was presented to support the value of $170,000.

Respondent placed into evidence the testimony of Ms. Kathy A. Pusateri, state certified residential real estate appraiser for St. Louis County. The appraiser testified as to her appraisal of the subject property. The Appraisal Report, Exhibit 1, of Ms. Pusateri was received into evidence. Ms. Pusateri arrived at an opinion of value for the subject property of $248,000 based upon a sales comparison approach to value. In performing her sales comparison analysis, the appraiser relied upon the sales of three properties which she deemed to be comparable to the subject property. The appraiser also performed a cost approach to value which provided an indicated value of $253,900.

The following exhibits were also received into evidence.

Exhibit 2 Property Record Cards on 3 properties in the subject subdivision which were utilized by Ms. Pusateri in making a paired sales analysis to address the issue of the impact upon the subject of having the property divided by a subdivision road.

Exhibit 3 Topographical map of the subject neighborhood.

Exhibit 4 Plat maps of the subject subdivision.

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

2. The subject property is located at 2408 Dehart Farm Road, Wildwood, Missouri. The proper is identified by locator number 23Y240182. The property consists of a 3 acre tract of land. The land is improved by a one-story, frame single-family structure of good quality construction. The house was built in 1987 and appears to be in fair condition. The residence has a total of eight rooms, which includes three bedrooms, three full baths, and contains 1,998 square feet of living area. There is a full basement, which has 1,260 square feet of recreation area. The house has an attached, two-car garage. Exhibit 1, p. 5. The house also suffers from some condition problems relating to siding, flooring, septic drain field, heating/air conditioning, drywall, foundation crack, and front porch condition. Exhibit 1, p. 10.

3. There was no evidence of new construction and improvement from January 1, 2001, to January 1, 2002.

4. Complainants= 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, 2001, to be $170,000.

5. The properties relied upon by Respondent=s appraiser in performing her appraisal were comparable to the subject property for the purpose of making a determination of value of the subject property. The properties were located within one mile of the subject. Each sale property sold at a time relevant to the tax date of January 1, 2001. Each property was similar to the subject in style, quality of construction, age, condition, bedroom and bathroom count, living area, garage and other amenities.

6. The comparables were described as follows:

Comparable 1 (220 Dehart Farm Road - 1/2-3/4 of a mile Northeast of Subject) sold in November, 1999 for $275,000. This property consists of a 3.07 acre lot improved by a one-story, vinyl-sided single-family structure of good quality construction. The house was built in 1992 and appears to be in average condition. The residence has a total of seven rooms, which includes three bedrooms, two full and one half baths. The house contains 1,640 square feet of living area. There is a full basement, which has 700 square feet of recreation area. There is an attached, two-car garage. Exhibit 1, p. 8-9.

Comparable 2 ( 19128 Old Logging Road - 1/8-1/4 of a mile Northwest of Subject) sold in June, 1998 for $290,000. This property consists of a 3 acre lot improved by a one-story frame single-family structure of good quality construction. The house was built in 1987 and appears to be in average condition. The residence has a total of eight rooms, which includes three bedrooms, two full and one half baths. The house contains 2,396 square feet of living area. There is a full basement, which has 750 square feet of recreation area. There is an attached, two-car car-port. Exhibit 1, p. 8-9.

Comparable 3 (19125 Old Logging Road - 1/8-1/4 of a mile Northwest of Subject) sold in April, 2000 for $305,000. This property consists of a 3 acre lot improved by a one-story frame, atrium ranch, single-family structure of good quality construction. The house was built in 1990 and appears to be in average condition. The residence has a total of nine rooms, which includes four bedrooms, three full and one half baths. The house contains 1,970 square feet of living area. There is a full basement, which has 900 square feet of recreation area. There is an attached, two-car garage. Exhibit 1, p. 8-9.

7. The appraiser made various adjustments to the comparable properties for differences which existed between the subject and each comparable. The adjustments for the various differences were appropriate to account for differences. The gross and net adjustments fell within generally accepted ranges for residential appraisals.

8. The net adjustments for Comparable 1 amounted to -$17,700 or -6% of the sales price. The net adjustments for Comparable 2 amounted to -$41,900 or -14% of the sales price. The net adjustments for Comparable 3 amounted to -$35,400 or -12% of the sales price.

9. The adjusted sales prices for the comparables calculated to $257,300, $248,100 and $269,600, respectively. The appraiser concluded on a $248,000 value which calculated to a value per square foot of $124.12 compared with the sales prices per square foot of living area for the comparables of $167.68, $121.04 and $157.54.

10. Respondent=s evidence was substantial and persuasive to rebut the presumption of correct assessment by the Board of Equalization.

11. To establish value, 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 and convincing to establish the value of the subject, as of January 1, 2001, to be $235,370.

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, p. 3.

Duty to Investigate

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 $235,370, 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, 2001. 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).

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 County 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.

The present case is unusual in that after repeated attempts to have an evidentiary hearing so that Complainants could appear in person, Complainants agreed to cancel the evidentiary hearing and requested that the Hearing Officer take note of written comments previously provided. The Hearing Officer has so noted both the Complainants= opinion of value and the basis for that opinion. However, the basis provided is not persuasive and is not probative to establish the value advocated.

Complainants offer a fair market value of $170,000. Essentially this is based upon nothing more than a statement asserted to have been made by an individual from the Assessor=s office. However, although Complainants were given various opportunities to submit documentation to support their opinion of value, nothing was filed with the Commission. The asserted statement made by Bob Bruns is inadmissible for a number of reasons.

First and foremost it is rank hearsay. It is an out of court statement offered to prove the truth of itself. It is apparent that Mr. Bruns, who has appeared before the Hearing Officer on numerous occasions, did not perform the appraisal of this property. Complainants made no request to have Mr. Bruns present to testify and be cross-examined relative to how he could have arrived at his opinion of value, absent an appraisal of the property. In short, no weight can be given to the unsupported and unsubstantiated statement purported to have been made by Mr. Bruns. Accordingly, the owner=s opinion has no probative value, since it is based upon an improper foundation and improper elements. Complainants= evidence is insufficient to rise to the level of substantial and persuasive to rebut the presumption of correct assessment by the board, let alone to establish the value proposed. As to Mr. Davidson=s claims relating to the Apoor@ condition of the property and related problems, those were adequately addressed by Respondent=s appraiser.

The evidence presented by Respondent meets the standard of clear and convincing to reestablish the value originally placed on the subject property by Respondent of $235,370. Respondent presented the appraisal of a state certified appraiser in which both a cost and sales comparison approach were performed. Furthermore, Ms. Pusateri accounted for the condition of the subject home and the fact the subject lot is divided by a subdivision road.

The appraiser made specific calculations relating to various condition problems, including siding, flooring, septic drain field, heat pump and air conditioning, laundry room door, garage foundation crack, wood deck, and front porch. From these calculations and estimates for repairs an appropriate adjustment was made to the sales comparables and an adjustment was also made in the cost approach relative to these factors. Exhibit 1, pp. 7, 9 & 10. In addition, the appraiser made an appropriate location adjustment to allow for the subject lot having a subdivision road split it. This allowance was made, even though her pair sales analysis for this factor did not establish that the market actually recognized this factor as a deficiency to the subject property. Exhibit 1, p. 9; Tr. 9, Lines 12-14.

The value and supporting evidence presented by Respondent=s expert is received for the purpose of sustaining the Assessor=s original valuation, since the value derived from the appraisal was an increase above the higher value between the assessor=s value and the board of equalization=s value. See, Evidence of Increase in Value, supra.

Complainants= opinion of value was not supported and substantiated by any relevant evidence. Therefore, it was without probative value in this appeal. Respondent=s appraisal was clear and convincing evidence to support the Assessor=s original value of $235,370. Accordingly, that value is to be set as the true value in money for the subject property as of January 1, 2001.

The assessed valuation for the subject property as determined by the by the Board of Equalization for St. Louis County for the subject tax day is SET ASIDE.

The assessed value for the subject property for tax years 2001 and 2002 is set at $44,720.

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 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 July 28, 2003.

STATE TAX COMMISSION OF MISSOURI

W. B. Tichenor

Chief Hearing Officer