THOMAS J. & DIANE C. WRIGHT,	)
	)
Complainants,	)
	)
v.	)		Appeal Number 03-20004
	)
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 $84,315, assessed value of $16,020.

Complainants appeared pro se.

Respondent appeared by Counsel, Carl W. Yates III, Assistant County 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.

Complainants appeal 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 $84,315 (assessed value of $16,020, as residential property). Complainants proposed a value of $50,000 (assessed value of $9,500). 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.

Complainant, Diane C. Wright, testified on behalf of Complainants. Ms. Wright=s testimony addressed the issue of the impact on the value of the subject property from a smokehouse operation being conducted on the property adjoining the subject on the southeast. It was Complainants= contention that the operation of the smokehouse on the property at 4013 Blow had reduced the fair market value of their property.

The following exhibits were received into evidence on behalf of Complainants.

Exhibit A    A video tape showing activity on the property at 4013 Blow, with a typed explanation of the activity shown on the tape.

Exhibit B    Written statement of Complainants setting forth the basis for their appeal.

Exhibit C    Copy of an estimate from A-1 Reliable Roofing & Tuckpointing.

Exhibit E    Copy of a Seller=s Disclosure Statement of the St. Louis Association of Realtors.

Exhibit G    Photographs of the exterior and interior of Complainants= home, privacy fence at 4013 Blow and top of smokehouse.

The following exhibits were excluded from evidence upon objection by Counsel for Respondent. See, Ruling on Objections, infra.

Exhibit D    Typed letter dated 12/8/03 under the name of James Wheatley.

Exhibit F1    Typed letter dated 5/17/02 under the name of James W. & Lillian M. Fernandez.

Exhibit F2    Typed letter dated 8/18/02 under the names of Theodore and Mary Therese Shear.

Exhibit F3    Typed letter dated 5/21/03 under the name of Ted Shear.

Exhibit F4    Copy of handwritten letter under the name of Angela Routt.

Exhibit H    Copy of State Tax Commission Orders dated 10/7/03 and 9/10/03, STC letter dated 7/18/03; copy of BOE hearing notice on Complainants= BOE appeal; copy of Complaint for Review of Assessment; copy of newspaper article on the BOE rejecting Complainants= appeal.

Exhibit I    Copy of various documents (letters, newspaper articles, statement of Complainants to BOE, photographs of smokehouse, portions of Ordinance 64749 and other St. Louis City Ordinances) presented to the BOE at Complainants= hearing before the Board.

Respondent=s Evidence

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 $106,000 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. The appraisal and opinion of value were not offered to advocate an increase in value but to sustain the value of $84,315, as originally determined by the Assessor.

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 4017 Blow Street. It is identified by parcel number 90150002000. The property consists of 4,320 square foot lot improved by a one-story, single-family, brick residence. The house was built in 1964. It contains 950 square feet of living area, with a full partially finished basement and a detached one-car garage. The house has four rooms, one bedroom and one bathroom. Exhibit 1.

3. There was no evidence of new construction and improvement from January 1, 2003, to the date of hearing.

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 $50,000.

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 3 blocks of the subject. Each sale property sold at a time relevant to the tax date of January 1, 2003. The sale properties are in the subject=s neighborhood. The sale properties were similar in style, quality of construction, age condition, room, bed room and bath room count, living area, lot size and other factors relevant to the appraisal problem presented in this appeal. Exhibit 1.

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

Comparable 1 (3934 Blow Street. - 3 blocks southeast east of the subject) sold in August, 2002 for $96,000. This property consists of a 6,650 square foot lot improved by a one-story brick, single-family, residence. The house is approximately 52 years old, in average condition, with five rooms, two bedrooms and one bathroom. The house has a total of 816 square feet of living area. There is a full basement, but no garage.

Comparable 2 (7351 Yates Street. - 3 blocks south of the subject) sold in July, 2002 for $105,000. This property consists of a 5,939 square foot lot improved by a one-story brick, single- family, residence. The house is approximately 49 years old, in average condition, with five rooms, two bedrooms and one bathroom. The house has a total of 940 square feet of living area. There is an attached carport and a full basement.

Comparable 3 (3915 Blow - 3 blocks southeast of the subject) sold in January, 2002 for $115,000. This property consists of a 6,900 square foot lot improved by a one-story brick, single- family, residence. The house is approximately 48 years old, in average condition, with five rooms, three bedrooms and one bathroom. The house has a total of 1,140 square feet of living area. There is a detached one-car garage and a full basement, with partial finish and a half bath.

7. The appraiser made various adjustments to the comparable properties for differences which existed between the subject and each comparable. The adjustments were appropriate for the purposes of the variances in relevant factors between each comparable and the subject.

8. The net adjustments for Comparable 1 amounted to +$6700 or 7% of the sales price. The net adjustments for Comparable 2 amounted to +$1,500 or 1.5% of the sales price. The net adjustments for Comparable 3 amounted to -$7,300 or 6.4% of the sales price.

9. The adjusted sales prices for the comparables calculated to $102,700, $106,500 and $107,700, respectively. The appraiser concluded on a $106,000 value which calculated to a value per square foot of $111.58 compared with the sales prices per square foot of living area for the comparables of $117.65, $111.70 and $100.87.

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 at least $84,315.

12. Smokehouses are a recent phenomenon in the south St. Louis City real estate market. Currently, influences of smoke houses on the market are not measurable as detracting to the value of an adjoining property. Exhibit 1.

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 $84,315, 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. 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); Reeves v. Snider, 115 S.W.3d 375 (Mo. App. S.D. 2003).

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.

Upon Complainants seeking to have certain exhibits introduced into evidence. Counsel for Respondent posed various objections. The Hearing Officer sustained same at the evidentiary hearing and now sets forth in greater detail the rulings and basis for same. Primarily, the excluded exhibits (D, F, H & I) constitute hearsay and therefore must be excluded. None of the out of court declarants were present to be cross examined. Even if they had been, their testimony would have generally been duplicative of Ms. Wright=s testimony and would not have been probative on the issue of fair market value.

Essentially, all of the excluded documents address the issue of the smokehouse, but offer nothing upon which a determination of the fair market value of Complainant=s home could be determined. Those documents which are copies of STC Orders, letter and Complaint form are all ready part of the file in this appeal and do not need to be introduced as separate exhibits. Furthermore, they are not probative on any issue before the Commission in this appeal.

Complainants challenge the valuation of their property based upon a single claim. That claim is that the smokehouse, constructed after their purchase in August, 2000, of their home for $82,000, has caused a loss in value to their property. There is no real dispute that there exists a smokehouse on the property next door (4013 Blow) to the Wrights= home.

The evidence is in conflict as to the operation of the smokehouse as of January 1, 2003. Ms. Wright believed that the smoke house was used as late as February, 2003. Mr. Donald=s investigation revealed that the owner of the smoke house property had ceased using it as a smoke house in or about January, 2002 due to complaints from the Wrights. In addition, Mr. Donald was advised by the St. Louis City=s Citizen Service Bureau that the only complaints regarding the smoke house had been lodged by Mr. and Mrs. Wright.

A review of Exhibits A (video tape), G and Exhibit 1 (photographs) failed to persuade the Hearing Officer that the existence of the smoke house or the operation thereof had decreased the value of Complainants= property by $32,000 since their purchase in 2000. The claim of the interior damage from smoke alleged to be due to the smoke house operation was not established by substantial and persuasive evidence. The interior photographs left the Hearing Officer with the conclusion that the discoloration was not that inconsistent with the general condition of a 40 year old house. Mr. Donald=s interior inspection on September 24, 2003 of the Complainants= home did not reveal smoke damage. The exterior photographs contained in Exhibit G, as well as, Mr. Donald=s exterior photographs in Exhibit 1 do not establish any visual smoke damage to the fascia, soffit, gutter, roof or the garage. The Complainants= garage is located just across the approximately 6 foot high privacy fence at 4013 Blow from the smoke house. However, the photographs fail to reveal any residual soot or smoke damage to the structure which is closest to the smoke house.

The Complainants bear the burden of proof on the issues of both the alleged smoke damage and more importantly the extent to which any such damage has impacted on the value of their home. 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); Reeves v. Snider, 115 S.W.3d 375 (Mo.App. S.D. 2003). Complainants= case essentially is that the neighbor=s smoke house has reduced the value of their home. However, there is no evidence presented on this record from which the Hearing Officer can find that on January 1, 2003 the subject property would have only commanded $50,000 in a market sales transaction. What is not disputed is that prior to the construction of the smoke house the subject property had a fair market value of $82,000 approximately 28 months prior to the 2003 tax date. There is no evidence that would justify a $32,000 deduction from even the 2000 fair market value of the Complainants= property for the smoke house factor.

Furthermore, the additional evidence on this record (Respondent=s appraisal) demonstrates that the fair market value of the subject property on January 1, 2003 was in point of fact approximately $106,000. In order to conclude that the subject property was only worth $50,000 because the neighbors had during 2001 and part of 2002 occasionally operated the smoke house would require a finding that the smoke house had a detrimental impact on the Wright property of $56,000. There is simply no evidence to support such a conclusion. Complainants failed to meet their burden of proof on this essential element of their case.

Respondent=s evidence was clear and convincing that the subject property has a fair market value of at least $84,315. Pursuant to Section 138.060 RSMo and 12 CSR 30-3.075, Respondent=s evidence was only received for the purpose of sustaining the Assessor=s value and not to increase the valuation.

Complainants questioned how Mr. Donald could appraise the subject property when he had no comparables that had a smoke house next door. While this factor is relevant, it does not render Mr. Donald=s valuation irrelevant. The appraisal demonstrates in a clear and convincing manner that, absent the smoke house factor, the subject property has a value of approximately $106,000. In the appraiser=s expert opinion, the matter of the smoke house being next door was not a detriment which warranted a negative adjustment to the sale comparables. The Hearing Officer concurs with the conclusion of Mr. Donald on this point.

There is no market data upon which it can be determined that the existence of the smoke house would result in a lower sales price for the subject. As noted above, the Complainants bore the burden of proof on the smoke house issue. Their burden was not met as to an amount of deduction, if any, which should be attributable to the factor of the smoke house. Even assuming that some downward adjustment for the existence of the smoke house would be warranted, an adjustment of approximately $22,000 or nearly 21% would still result in a market value of $84,000 for the subject.

The Hearing Officer recognizes that the past operation of the smoke house has been a very strong point of contention for the Complainants. The Hearing Officer is not in any way seeking to trivialize the Complainants= opposition to the existence and operation of the smoke house. However, the evidence simply does not establish that the fair market value of the subject property on January 1, 2003 would have been only $50,000. The evidence clearly establishes a value of at least $84,315, accordingly the value determined by the Assessor and sustained by the Board must be affirmed.

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 $16,020.

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