State Tax Commission of Missouri

 

STEPHEN CAMPBELL,                                 )

)

Complainant,                )

)

v.                                                         )           Appeal Number 05-10095

)                        

PHILIP MUEHLHEAUSLER, ASSESSOR,   )

ST. LOUIS COUNTY, MISSOURI,               )

)

 Respondent.                )

 

 

DECISION AND ORDER

 

HOLDING

 

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 2005 and 2006 to be $342,000, assessed value of $64,980.

Complainant appeared pro se.

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

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

ISSUE

The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2005.

SUMMARY

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 $485,300, assessed value of $92,210, as residential property.  The Board reduced the value to $407,800, assessed value of $77,480.  Complainant proposed a value of $250,000, assessed value of $47,500. 

A hearing was conducted on May 9, 2006, 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’s Evidence

Complainant testified in his own behalf and offered his opinion of value for the subject property to be $250,000.  No documentation was provided in support of this opinion of value.

Complainant called Darryl Knopf, State Certified General Real Estate Appraiser to testify as to his appraisal of the subject property for refinance purposes.  Mr. Knopf’s appraisal was received into evidence as Exhibit A.  Mr. Knopf reached an opinion of fair market value for the Campbell residence of $290,000 as of February 25, 2004.  Mr. Knopf did not have an opinion as to what the subject’s fair market value would have been as of January 1, 2005.  

Mr. Campbell offered the following documents in evidence.

Exhibit B – 2006 Home Sale Guide from USA Today.

Exhibit C – Home sales data from SmartMoney, December 2005.

Exhibit D – Home sales data from the USA Today website, dated 12/24/05.

Exhibit E – Copy of Map and Photographs referencing property at 6 Meadow Acres Lane.

Exhibit F – Copy of the 1999 Sales Contract on the subject property.

Exhibit G – Copy of page 2 of the Assessor’s Record on the Subject Property.

Counsel for Respondent objected to Exhibits B, C and D on the grounds of hearsay, relevance and lack of foundation.  The objections were sustained and the exhibits were excluded and not considered in the rendering of the Decision in this case.  General sales data on percentage of increase on home sale prices is not a recognized method for the appraisal of property for ad valorem tax purposes.  Such information has no probative value as to the price a willing buyer and seller would pay for any given property.

Exhibit E was offered as a rebuttal exhibit with regard to Comparable 4 in the Respondent’s appraisal (Exhibit 1).  It was received into evidence, however it had no rebuttal value, as it did not rebut any factual statement in Exhibit 1.  Exhibits F and G were offered to show the sale history on the subject property.  The information as to the 1999 purchase of the property by Mr. Campbell and his testimony in explanation provides no substantial and persuasive evidence that supports Mr. Campbell’s opinion of value of $250,000 as of January 1, 2005.  The 1999 purchase of the subject property by Complainant is too remote in time to establish fair market value as of January 1, 2005.

Respondent’s Evidence

Respondent placed into evidence the testimony of Mr. John D. Rebsamen, State Certified Residential Real Estate 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 $342,000 based upon a sales comparison approach to value.  In performing his sales comparison analysis, the appraiser relied upon the sales of four properties which he deemed to be comparable to the subject property.   Exhibit 2, copies of maps showing the location of Highway 40/I-64 in relation to the subject and Comp 4 in Exhibit 1 was received into evidence.

FINDINGS OF FACT

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 71 Berkshire Drive, Richmond Heights, Missouri.  The property is identified by locator number 20 K 440031.  The property consists of .52 of an acre lot improved by a single family, one-story brick house, two-car attached masonry garage, covered patio, paved walkway and paved driveway leading to the rear entry garage.  The improvements are of average construction.  The home was built in 1956 and the improvements conform to the typical age, style, size and condition for the market area.  There are no apparent items of deferred maintenance.  The home has a total of 7 rooms, including 3 bedrooms and 2.5 baths.  It contains 2,349 square feet of living area.  The basement has not finished rooms.  To the rear of the property is Highway 40/I64.  Due to the adjacent highway proximity, the location and view is considered below average for the neighborhood.  

3.         There was no evidence of new construction and improvement from January 1, 2005, to January 1, 2006.

4.         Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Assessor or the Board and establish the true value in money as of January 1, 2005, to be $250,000, as proposed.

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 four properties were located within a mile of the subject.  Each sale property sold at a time relevant to the tax date of January 1, 2005.  The sale properties were similar to the subject in style, quality of construction, age, condition, room, bedroom and bathroom count, living area, site size and other amenities of comparability.  The adjustments made by the appraiser were reasonable and appropriate to account for the differences between the subject and the comparables.

6.         Respondent presented substantial and persuasive evidence to rebut the presumption of correct assessment by the Assessor and the Board and establish the fair market value of the subject property as of January 1, 2005, to be $342,000.

CONCLUSIONS OF LAW AND DECISION

Jurisdiction

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.

Presumptions in Appeals

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, is accepted as true only until and so long as there is no substantial evidence to the contrary. 

The  Supreme Court of Missouri has held, “A tax assessor’s valuation is presumed correct.”  Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341 (Mo. 2005).  Citing to Hermel, supra; and Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).

            The presumption of correct assessment is rebutted when substantial and persuasive evidence is presented to establish that the assessor’s or Board’s valuation is erroneous and what the fair market value should have been placed on the property.  Snider, Hermel & Cupples Hesse, supra.

Standard for Valuation

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, supra.

Market Value

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

Complainant Fails to Prove Value

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, 2005.  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).

Complainant has failed to meet his burden of proof.  The Knopf appraisal was not offered to support the owner’s opinion of value, nor did it provide a fair market value as of January 1, 2005.  Complainant’s opinion of a fair market value of $250,000 was not supported by any recognized methodology for appraising property.

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).   In the present appeal, the opinion of value of $250,000 was not established to rest on a property foundation or to be drawn from proper elements, accordingly it can be given o probative weight.

Respondent presents Substantial and Persuasive Evidence

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.

In the present appeal, Respondent has met that burden.  The valuation of the subject property presented a difficult problem as to adjusting for the location of the subject property.  No pared sale could be found of a property similar to the subject that had recently sold which was located in such a way as to back to Highway 40/I-64 in St. Louis County.  However, the sale of the property at 6 Meadow Acres Lane (Comp 4, Exhibit 1) provides an indication of value for a property that faces Highway 40/I-64 although separate by the frontage road along the Highway.

Since Mr. Knopf offered no opinion of value for the Campbell property as of January 1, 2005, the Hearing Officer is not obliged to second guess a state certified appraiser and attempt to utilize the Knopf data to trend it up to the January 1, 2005, assessment date.  In any case, Mr. Campbell was not offering Exhibit A in support of his opinion of value of $250,000, as no attempt to reconcile the Knopf opinion of $290,000 was made.

            The Hearing Officer is persuaded by the only evidence tendered as to a fair market value of the subject property as of January 1, 2005, the Rebsamen appraisal. 


ORDER

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 2005 and 2006 is set at $64,980.

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 2000.

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 22, 2006.

STATE TAX COMMISSION OF MISSOURI

 

 

_____________________________________

W. B. Tichenor

Senior Hearing Officer

 

 

 

 

Certificate of Service

 

I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 22nd  day of May, 2006, to:    Stephen Campbell, 71 Berkshire, Richmond Heights, MO 63117, Complainant; Paula Lemerman, Associate County Counselor, County Government Center, 41 South Central Avenue, Clayton, MO 63105, Attorney for Respondent; Philip A. Muehlheausler, Assessor, County Government Center, 41 South Central Avenue, Clayton, MO 63105; John Friganza, Collector, County Government Center, 41 South Central Avenue, Clayton, MO 63105.

 

 

___________________________

Barbara Heller

Legal Coordinator