LOUIS J. SWALLOW,	)
	)
Complainant,	)
	)
v.	)		Appeal Number 03-10138
	)
PHILIP MUEHLHEAUSLER, ASSESSOR,	)
ST. LOUIS COUNTY, MISSOURI,	)
	)
Respondent.	)

Decision of the St. Louis County Board of Equalization sustaining the assessment made by the Assessor, SET ASIDE, Hearing Officer finds true value in money for the subject property for tax years 2003 and 2004 to be $340,000, assessed value of $64,600.

Complainant appeared pro se.

Respondent appeared by Counsel, Paula J. Lemerman, Associate 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. Complainant attempted to raise the issue of discrimination at the evidentiary hearing.

Complainant appeals, on the ground of overvaluation, 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 $356,100 (assessed value of $67,660, as residential property). The Board reduced the value to $331,700 (assessed value of $63,030). Complainant proposed a value of $309,940 (assessed value of $58,890), in his Complaint for Review of Assessment. A hearing was conducted on April 27, 2004, at the St. Louis County Government Center, Clayton, Missouri.

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

Complainant testified in his own behalf and gave an opinion of value of $291,585. This was an amendment of the opinion given in the Complaint for Review of Assessment of $309,940, based on information relating to cost of piering for settlement problems with the subject house. Complainant=s opinion of value was based on his own analysis and methodology as set for in three exhibits.

Exhibit A, a statement of Complainant to the Commission, dated August 27, 2003, with attached spread sheets and photographs of the subject and neighboring properties.

Exhibit B, a statement of Complainant to the Board of Equalization, dated June 9, 2003, with attached spread sheets and a copy of the Change of Assessment Notice, dated May 19, 2003.

Exhibit C, a statement of Complainant to the Commission, dated April 26, 2004, with a photograph of a crack over one corner of the subject garage and a bid for installation of a piering system to address settlement problems of the subject house and garage.

Exhibits A, B and C were received into evidence over the objection of Respondent=s Counsel. See, DECISION, infra, for discussion of probative value of the exhibits.

Respondent placed into evidence the testimony of Mr. Arthur R. Froeckmann, Missouri State Certified Residential Appraiser for St. Louis County. The appraiser testified as to his appraisal of the subject property. The Appraisal Report, Exhibit 1, of Mr. Froeckmann was received into evidence. Mr. Froeckmann arrived at an opinion of value for the subject property of $350,000 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. At the evidentiary hearing, the appraiser, after hearing testimony of Complainant and reviewing the repair bid contained in Exhibit C, concurred that an additional negative adjustment of $10,000 to his final opinion of value would not be out of line to account for the settlement issue. This resulted in an indicated market value of $340,000 or an assessed value of $64,600.

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 12536 Cinema Lane, Sunset Hills, Missouri. The property is identified by locator number 26M120351. The property consists of 2.10 acre lot improved by a one-story brick ranch single-family structure of average quality construction. The house was built in 1976 and appears to be in fair to average condition. The residence has a total of eight rooms, which includes four bedrooms, two full and one half baths, and contains 2,942 square feet of living area. There is a full unfinished basement and an attached two-car garage. Other improvements include an open front porch, rear deck over a concrete patio, concrete walkway and driveway. There was no listing or sale of the property noted within three years prior to the tax date of January 1, 2003. The house suffers from some settlement problems on the Northwest and Southeast corners. Exhibit 1, p. 5; Exhibit C.

3. There was no evidence of new construction and improvement from January 1, 2003, to January 1, 2004.

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 $309,940, as set out on the Complaint for Review of Assessment or $291,585, as testified to at hearing.

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 of the subject property. The properties were located within a half mile 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 style, quality of construction, age, condition, room, bedroom and bathroom count, living area, location, site size and other amenities of comparability. Exhibit 1, pp. 5-8.

6. The comparables were described as follows:

Comparable 1 (12120 Westwick Place - .5 of a mile Northeast of the subject) sold in March 2001 for $345,000. This property consists of a .46 of an acre lot improved by a one-story brick single-family structure of average quality construction. Other improvements include an open front porch, patio, paved walkway and a blacktop driveway. The house was built in 1983 and appears to be in average condition. The residence has a total of seven rooms, which includes three bedrooms, two full baths, and contains 2,616 square feet of living area. There is a full unfinished basement. There is an attached two-car garage. There was no reported deferred maintenance.

Comparable 2 (12477 Matthews Lane - .2 of a mile North of the subject) sold in November 2002 for $340,000. This property consists of a 1.89 acre lot improved by a split level brick and frame single-family structure of average quality construction. Other improvements include an open front porch, two decks, paved walkway and blacktop driveway. The house was built in 1973 and appears to be in average condition. The residence has a total of eight rooms, which includes three bedrooms, three full baths, and contains 2,646 square feet of living area. There is a full basement with finished area. There is an attached three-car garage. There was no reported deferred maintenance.

Comparable 3 (9500 Crooked Creek Trail - .4 of a mile South of the subject) sold in August 2001 for $395,000. This property consists of a .55 of an acre lot improved by a split level stucco single-family structure of average quality construction. Other improvements include an open front porch, two decks, paved walkway, in-ground swimming pool, and concrete driveway. The house was built in 1983 and appears to be in average condition. The residence has a total of eight rooms, which includes four bedrooms, two full baths, and contains 2,565 square feet of living area. There is a full basement with finished area. There is an attached two-car garage. There was no reported deferred maintenance.

7. The appraiser made various adjustments to the comparable properties for differences which existed between the subject and each comparable. All adjustments appear to be appropriate to bring the comparables in line with the subject for purposes of the appraisal problem. An initial adjustment of a -$5,000 to address the settlement problem was made by the appraiser. At the hearing, the appraiser concurred that an additional -$10,000 adjustment, in light of the evidence in Exhibit C would be reasonable.

8. The net adjustments for Comparable 1 amounted to +$2,800 or less than 1% of the sales price. The net adjustments for Comparable 2 amounted to -$6,100 or less than 1% of the sales price. The net adjustments for Comparable 3 amounted to -$49,700 or 12.6% of the sales price. The net adjustment amounts and percentage adjustments amounts reflect the inclusion of an additional -$10,000 to account for the subject=s settlement problem.

9. The adjusted sales prices for the comparables calculated to $347,800, $333,900 and $345,300, respectively. The appraiser concluded on a $340,000 value which calculated to a value per square foot of $115.57 compared with the sales prices per square foot of living area for the comparables of $131.88, $128.50 and $154.00.

10. Respondent did not have to meet a standard of clear, convincing and cogent evidence in this appeal, under the provisions of Section 137.115, RSMo, as he was not 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 substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the value of the subject, as of January 1, 2003, to be $340,000.

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 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, 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.

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)

In order to prevail, Complainant 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).

Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the Board of Equalization, must meet the same burden of proof to present substantial and persuasive evidence of the value advocated as required of the Complainant under the principles established by case law. Hermel, Cupples-Hesse, Brooks, supra.

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).

Evidence of the actual sales price of property is admissible to establish value at the time of an assessment, provided that such evidence involves a voluntary purchase not too remote in time. The actual sale price is a method that may be considered for estimating true value. The actual sales price, between a willing seller who is not obligated to sell and a willing buyer who is not compelled to buy, establishes an outer limit on the value of real property. St. Joe Minerals Corp. v. STC, 854 S.W.2d 526 (App. E.D. 1993).

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.

Discrimination

In order to obtain a reduction in assessed value based upon discrimination, the Complainant must (1) prove the true value in money of the property under appeal 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. 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). The difference in ratios as between the subject property=s ratio and the average assessment ratio 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).

The Commission is without authority to amend the grounds alleged in the Complaint to include an additional ground for appeal. Daly v. State Tax Commission, 120 S.W.3d 262 (Mo. App. E.D. 2003) Lewis and Clark State Bank, et al., v. Muehlheausler, STC Appeals No. 01-11402 et al., Order, dated 3/04/04.

Complainant has the burden to present substantial and persuasive evidence to rebut the presumption of correct assessment by the Board and to establish the value asserted. In order to meet this burden of proof, the owner=s opinion of value must be based upon proper elements and a proper foundation. The courts of Missouri and the Commission have recognized basic appraisal approaches to determine fair market value in the absence of an actual sale of the subject property at a time relevant to the tax date. The theory of value advanced by Mr. Swallow was not any technique of valuation that is generally accepted and recognized within the appraisal field. Therefore, the owner=s opinion can be given no evidentiary weight. It has no probative value. Therefore, the Complainant=s burden of proof was not met.

Taxpayers often want to calculate the various percentages of increase on land, improvements and overall value of their property from the Assessor=s records. Sometimes taxpayers go a few steps further and make such calculations for neighboring properties, properties on their street or properties in their subdivision as shown in the Assessor=s records. Ordinarily when such theories of valuation have been presented before the Hearing Officer the taxpayer is arguing for the property under appeal to only be increased in value by the average percentage which has been calculated. Such an approach and the diverse variations that have been presented over the years come under the general title of Acomparative assessment.@

This type of valuation methodology is quite simple and very appealing to many taxpayers, because it is grounded in a very basic mathematical calculation. It is usually asserted that the figures are correct and therefore the value derived from such an arithmetical exercise must be correct. However, such a procedure (comparative assessment) is fatally flawed as it is based upon an incorrect assumption.

Any form of comparative assessment theory starts with the presumption that the Assessor properly valued the subject property in the prior assessment cycle or the present cycle. This is in error. By statute there is no presumption that the Assessor has correctly valued the subject property in any assessment cycle. In like manner there is no presumption that the Assessor has correctly value the other properties being used in the comparative assessment. Therefore, any calculations made from such comparisons are of no probative value.

While the calculations may be correct, all they demonstrate is the percentage difference between one assessment cycle and the following cycle. They do not establish that in point of fact the fair market value of the property was what the Assessor set in the 2001 or the 2003 cycle. That is the critical issue.

Mr. Swallow has presented his own theory of value based on a comparative assessment technique. It has no more relevance to fair market value than any other comparative assessment method which the Hearing Officer has observed over the past twelve years in literally hundreds of appeals. There simply is no proper appraisal basis for the methods of valuation that Mr. Swallow proposes. No licensed or certified appraiser is going to value property as Complainant has attempted. The procedure put forth has never been accepted by the courts of this or any other state to the knowledge of the Hearing Officer, nor has the Commission ever sanctioned such a method for valuing property.

The first method Mr. Swallow offered was to calculate the percentage of the land and improvement as a part of the total assessed value for the subject property in the 1993 through 2003 assessment cycles. He then calculated the percentage changes for land, improvement and total assessed value for each of the six assessment cycles. From this he calculated the (1) average of land as a percent of the total assessed value; (2) average percent changes for land and improvement and total. This calculation was made for the 1993 through 2001 cycles and also for 1993 through the 2003 proposed cycles.

Mr. Swallow then proposed a total propose percentage increase for 2003 over the 2001/02 assessment cycle of 5.49%. The total assessed value of the subject property for 2001/02 was $56,910. Applying the 5.49% to the prior assessed value produces an indicated assessed value of $60,035, or a fair market value of $315,950 (56,910 x .0549 = $3,124, rounded to 3,125; $56,910 + $3,125 = $60,035; $60,035/.19 = $315,973, rounded to $315,970). In other words, this method does not support the proposed value of $309,940. It is in any case an inappropriate method for valuation with no probative value.

This method assumes that in point of fact the Assessor=s assessed values for each of the prior assessment cycles actually represented fair market value. By statute there is no presumption of such correctness. Mr. Swallow would need to establish that each of the indicated market values did in fact represent the fair market value for the subject property for each of the five prior assessment cycles. Even establishing that would not establish a net percentage increase in the total assessed value of 10,75% by the Board of Equalization was in error. This is because market evidence from prior assessment cycles does not provide market data for the 2003 assessment cycle.

There is no question that the percentages calculated by Mr. Swallow are mathematically accurate. However, the percentages simply have no relevance to whether the fair market value of the subject property on January 1, 2003, should be $309,940 as originally proposed by Complainant, or $315,970 as calculated using the average percentage of change as proposed by the Complainant. This theory of value has no probative value whatsoever, because it is not based upon a single element of market data at to what the property would have sold for in an open market transaction on January 1, 2003. That is the issue that must be addressed.

The next theory of valuation developed by Mr. Swallow was to arrive at calculations as to the percentage of the total assessment that the land value represents for the subject, for the properties utilized by the county=s mass appraisal system and also four other properties on the subject street. From all of these various calculations, Complainant concludes the land assessment should not exceed $18,000 or 30.6% of the total assessment on the subject property. No real challenge is made by Mr. Swallow to the assessment for improvement. The Board set the improvement assessed value at $40,890 (fair market value of $215,210). If an $18,000 land assessed value is added to the improvement assessed value then a total assessed value of $58,890 (40,890 + $18,000 = $58,890; $58,890/.19 = $309,947, rounded to $309,950) is established. This is the assessed value which was proposed by Complainant in his Complaint for Review of Assessment.

However, once again this method is devoid of any actual market data relative to the subject=s land value or value as improved. The land value advocated by Mr. Swallow is based simply on calculations as to percentages of land assessed value in relation to the total assessed value and averaging the resulting figures. Without market data to establish the fair market data for his land, Mr. Swallow has no proper basis to establish his proposed value for either the subject land or the subject land as improved.

The matter of the land value established by either the Assessor on a property record card or by the Board in its decision letter in an appeal before the Commission is irrelevant. As pointed out by Mr. Swallow A... the land component of the sale price is not and cannot be separately identified.@ Exhibit A. Sales of improved real estate simply do not establish what the buyer and seller agreed to as a separate land value, if any, since it is unnecessary in real estate transactions. In like manner it is unnecessary in appeals before the Commission.

Improved residential property is best valued by the sales comparison approach. In the market approach there is no need to separate out land value from total value. The fair market value of the entire tract as improved on the relevant tax date is all that is necessary to be established. Only if an appraiser is seeking to perform a cost approach would it be necessary to establish a separate land value.

In such an instance it would be necessary to establish from comparable sales of vacant land the land value. In the absence of sufficient vacant land sales, a cost approach should not generally be attempted. All of the various calculations of percentages by Mr. Swallow ignored the most basic issue in an overvaluation appeal before the Commission - fair market value of the real estate, that is the land and improvements combined. This theory of value has no support from market data either for land or the land as improved. As such, this theory presents no relevant or probative evidence on the issue of fair market value.

Mr. Swallow asserted that since the bid for repair to address the settlement problem which exists with the subject house came in at $18,355, that amount should be deducted from his previous opinion of value which would produce an indicated fair market value of $291,585. The Complainant is simply mistaken as to the proper means to account for cost to repair. The market will seldom, if ever, return dollar for dollar the amount expended for deferred maintenance items.

Appraisers always desire to have cost information related to repairs. However the adjustment to be made to comparables in a sales comparable analysis should reflect what the market would recognize for the non-existence of the condition which needs repair or maintenance. Simply deducting the total cost for some repair does not reflect market action. Such cost figures assist a trained and knowledgeable appraiser in making an adjustment.

The opinion of valued of $291,585 offered by Mr. Swallow was not based upon proper elements and a proper foundation. It started from a value which was not established by a recognized appraisal methodology. The deduction then made for the cost of piering was not in accordance with generally accepted appraisal practice. Therefore, the resulting opinion of value is not probative on the issue of fair market value.

The only ground stated in the pleading (Complaint for Review of Assessment) filed in this appeal was overvaluation. The introduction of the argument of unequal or inconsistent land values and unequal or inconsistent valuation under the computer-assisted mass appraisal system was an attempt to amend the grounds for appeal. Amendment of pleadings before the Commission is not permitted. Daly v. State Tax Commission, supra.

Even if Complainant was permitted to amend his pleading to include the ground of discrimination the evidence presented falls completely short of that necessary to carry forward such a claim. Where there is a claim of discrimination based upon a lack of valuation consistency, Complainant has the burden to prove 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.

Once the level of assessment as a percentage of true value in money has been established by Complainant, it is then the Complainant=s burden to establish the average level of assessment for residential property in St. Louis County for 2003. In order to meet this evidentiary burden, the Complainant must (a) independently determine the market values of a representative sample of residential properties in St. Louis County; (b) determine the assessed values placed on the representative sample properties by the assessor=s office for the relevant year; (c) divide the assessed values by the market values to determine the level of assessment for each property in the sample; and (d) determine the mean and median of the results of the total sample.

In order to establish the claim of discrimination, 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 County must demonstrate a disparity that is grossly excessive.

Complainant=s discrimination claim fails because he failed to establish the market value of the subject property. Without establishing the subject=s market value, the assessment ratio cannot be established. Without establishing the ratio for the property under appeal, it cannot be establish that the subject property is being assessed at a higher percentage of market value than the average of residential properties in St. Louis County.

However, even if Complainant had established the market value for the subject property, the discrimination claim would still fail because it was not demonstrated that a statistically significant number of other residential properties within St. Louis County are being assessed at a lower ratio of market value than the subject property. Complainant=s claim of discrimination is based upon only nine properties for which the Complainant failed to establish the market value for any of the properties. Complainant=s own evidence established that each of those properties are being assessed at the statutory assessment ratio of 19% for residential property. Complainant failed to establish that any of the nine properties were undervalued so as to render their true assessment ratio at some percentage other than 19%.

Because Complainant=s proffered evidence failed to establish the market value of the subject property and failed to establish the property under appeal as being assessed at a higher percentage of market value than a statistically significant number of other properties in St. Louis County, he would have failed to establish discrimination, if the Commission were permitted to allow Complainants to amend their pleadings.

The evidence presented by Respondent was substantial and persuasive to rebut the presumption of correct assessment by the Board of Equalization. The appraisal report of Mr. Froeckmann, with the additional adjustment for the settlement condition of the subject was substantial and persuasive evidence to establish the fair market value of the subject property to be $340,000, as of January 1, 2003.

The assessed valuation for the subject property as determined 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 2003 and 2004 is set at $64,600.

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 May 14, 2004.

STATE TAX COMMISSION OF MISSOURI

W. B. Tichenor

Hearing Officer