NORMAN & MAXINE BAUER,	)
	)
Complainants,	)
	)
v.	)		Appeal Number 03-10072
	)
PHILIP MUEHLHEAUSLER, 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 2003 and 2004 to be $122,000, assessed value of $23,180.

Complainants 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.

Complainants appeal, 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 $140,900 (assessed value of $26,770, as residential property). The Board reduced the value to $118,600 (assessed value of $22,530). Complainant proposed a value of $90,000 (assessed value of $17,100). A hearing was conducted on April 20, 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, Mr. Bauer, testified in his own behalf. He gave the opinion of value for the subject property to be $90,000. There were two factors which Mr. Bauer felt devalued the Complainants= property. The first negative factor was the fact that the subject property is not on the county sewer system, but has a septic tank. The second factor is the appearance of the home, especially a difference in the color of bricks on the rear garage wall when a car crashed through the wall in 1985. The damage to the wall was repaired but the bricks did not exactly match.

Complainants offered into evidence the following exhibits:

Exhibit A A copy of a Supplement to Sale Contract, dated April 15, 1998, relating to the cost of getting a neighboring property connected to the county sewer.

Exhibit B A listing of sales of properties in the subject area, dated 6/23/99.

Exhibit C A listing of sales of properties in the subject area, dated 9/2/01

Exhibit D 3 photographs of the back wall of the garage showing the damage done in 1985.

Counsel for Respondent objected to exhibits A, B and C on the grounds hearsay, relevancy and lack of foundation. The objections were sustained, and Exhibits A, B and C were not received into evidence. Exhibit D was received into evidence.

Respondent placed into evidence the testimony of Mr. John Rebsamen, appraiser for St. Louis County. The appraiser testified as to his appraisal of the subject property. The Appraisal Report, Exhibit 1, of Mr. Rebsamen was received into evidence. Mr. Rebsamen arrived at an opinion of value for the subject property of $122,000 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.

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 5546 Homeward Lane, St. Louis, Missouri. It is identified by locator number 31K230243. The property consists of a .44 of an acre lot. It is improved by a single-family one-story masonry house with a full basement and a two-car front entry garage. The improvements are considered to be average quality construction. The house was built in 1961 and the improvements appear to be in average physical condition. The residence has a total of six rooms, which include three bedrooms, two full baths, and contains 1,344 square feet of living area. There is some deferred maintenance on the exterior of minor tuck-pointing. No structural problems exist, however some cracks in the brick and the concrete foundation are visible. These are generally consistent with a home of the subject=s age. The rear garage wall and adjacent area sustained damage from a vehicle approximately 20 years ago and was repaired. The subject house is on a septic system. Exhibit 1, p. 5.

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

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, 2003, to be $90,000.

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 of the subject property. The properties were located within less than 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.

6. The comparables were described as follows:

Comparable 1 (5418 Ringer Road - .30 of a mile Northeast of the subject) sold in September 2002 for $130,000. This property consists of a .23 of an acre lot improved by a single-family one-story masonry and frame structure with a full basement and a one-car attached garage. The improvements are considered to be average quality construction. The house was built in 1979 and the improvements appear to be in good physical condition. The residence has a total of five rooms, which include two bedrooms, two full baths, one half bath and contains 1,416 square feet of living area. The property has a septic system.

Comparable 2 (5932 Rockland Lane - .44 of a mile Southwest of the subject) sold in September 2002 for $114,000. This property consists of a .40 of an acre lot improved by a single- family one-story vinyl sided frame structure with a full basement and a two-car attached garage. The improvements are considered to be average quality construction. The house was built in 1949 and the improvements appear to be in average physical condition. The residence has a total of four rooms, which include two bedrooms, one full bath and contains 765 square feet of living area. The property is on a public sewer system.

Comparable 3 (5562 Homeward Lane - .11 of a mile Southwest of the subject) sold in December 1999 for $125,000. This property consists of a .79 of an acre lot improved by a single- family one-story masonry structure with a full basement, a two-car attached garage and a two-car attached carport. The improvements are considered to be average quality construction. The house was built in 1956 and the improvements appear to be in good physical condition. The residence has a total of six rooms, which include three bedrooms, one full baths, and contains 1,064 square feet of living area. The property has a septic system.

Comparable 4 (5476 Ringer Road - .13 of a mile Northwest of the subject) sold in August 1999 for $129,000. This property consists of a .49 of an acre lot improved by a single-family one-story frame structure with a full basement and a two-car attached garage. The improvements are considered to be average quality construction. The house was built in 1956 and the improvements appear to be in average physical condition. The residence has a total of seven rooms, which include three bedrooms, three full baths, and contains 1,981 square feet of living area. The property has a septic system.

7. Two additional properties at 5573 and 5575 Starlit Drive, in the same subdivision as the subject sold in July and May of 2003 respectively for $164,000 and $160,000. The appraiser did not make adjustments to these properties to arrive at an indicated value. They were offered to demonstrate general sale prices close to, but after tax date. These properties were very similar to the subject in all relevant factors.

8. 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. The appraiser did make an adjustment to the one comparable that was on public sewer system. Adjustments were also made to those comparables deemed to be in superior condition to the subject.

9. The net adjustments for Comparable 1 amounted to -$6.900 or 5.31% of the sales price. The net adjustments for Comparable 2 amounted to +$7,600 or 6.67% of the sales price. The net adjustments for Comparable 3 amounted to -$10,900 or 8.2% of the sales price. The net adjustments for Comparable 4 amounted to -$6,000 or 4.65% of the sales price.

10. The adjusted sales prices for the comparables calculated to $123,100, $121,600, $122,100 and $123,000, respectively. The appraiser concluded on a $122,000 value which calculated to a value per square foot of $90.77 compared with the sales prices per square foot of living area for the comparables of $91.81, $149.02, $125.00 and $65.12. The two properties which were shown as having sold in 2003 sold for $119.75 and $102.04 respectively.

11. 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.

12. Respondent=s evidence met the standard of substantial and persuasive to establish the value of the subject, as of January 1, 2003, to be $122,000.

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 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.

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, 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).

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).

The opinion of value offered by Complainants was not supported by an approach to value which is recognized and accepted in the appraisal industry. The major issue of the subject being on a septic system was addressed through the Respondent=s appraisal. Complainants did not demonstrate that their opinion of value was based upon proper elements or a proper foundation. Therefore, no probative value can be given to it.

Exhibit A was excluded due to its lack of relevance. Complainant attempted to use a document that was executed approximately 5 years before tax date to establish the cost of connecting to the public sewer system. This is clearly a hearsay document and it is out of date. Complainant=s conclusion that it would cost $20,000 to be connected in 2003 is simply not established by Exhibit A. Even if Complainants had established the actual cost for connecting to the public system, this would not establish the market impact on fair market value for the property not being on public sewer. Furthermore, Mr. Rebsamen made a $10,000 deduction for this factor on the only comparable which was on the public sewer system. It is generally understood that the market will not return dollar for dollar the cost for various improvements to a property.

Exhibits B and C were excluded due to the fact that such newspaper listings provide no relevant evidence upon which a determination of value of another property can be made. The most that can be said for such a newspaper listing is that it reports the address of a property and a sale price. Without additional data such as date of sale and information to establish the relevant and essential factors of comparison to the subject these lists have not evidentiary value.

The evidence presented on behalf of Respondent in the appraisal report of Mr. Rebsamen provided substantial and persuasive evidence to rebut the presumption of correct assessment by the Board and establish the fair market value of the subject property of $122,000. The appraiser was able to utilize four different comparables, three of which, like the subject had a sewer system. The negative adjustment of $10,000 for the one comparable which was on a public sewer system was appropriate to account for this particular difference. Even though two of the comparables were approximately 600 square feet smaller or larger than the subject, this did not disqualify them as comparable properties. The two sales which occurred in 2003 provided additional support for the valuation of the property as determined by Respondent=s appraiser.

Complainants failed to present an opinion of value which was supported by an appropriate and recognized methodology for valuation. Respondent present an appraisal report utilizing the sales comparison approach to value. Respondent=s evidence met the standard of substantial and persuasive to establish the fair market value of $122,000. The value as determined by the Board has been rebutted.

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 $23,180.

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 April 29, 2004.

STATE TAX COMMISSION OF MISSOURI

W. B. Tichenor

Hearing Officer