State Tax Commission of
STEVE J. HOLLAND, )
)
Complainant, )
)
v. ) Appeal Number 05-30057
)
MICHAEL O’FLAHERTY, )
DIRECTOR OF ASSESSMENT, )
)
Respondent. )
DECISION AND ORDER
HOLDING
The decision of the Board of Equalization, setting value at $175,000 (assessed value $33,350) is SET ASIDE. Value is set at $168,000 (assessed value $31,920) as proposed by Respondent at hearing.
ISSUE
The issue in this case is the true market value of a residential lot and dwelling.
SUMMARY
The subject property
is a residential property which was originally valued by the assessor at $118,110
(assessed value $22,440). Upon appeal,
the Board of Equalization raised value to $175,000 (assessed value $33,350). Complainant appeals asserting a value of $98,560
(assessed value $18,730). Respondent
presented evidence supporting a value of $168,000 (assessed value
$31,920). An evidentiary hearing was
held on
EXHIBITS
The following exhibits were entered into the record:
Complainant’s Exhibits
Exhibit A – Miscellaneous Photos and Information on Subject Property
Respondent’s Exhibits
Exhibit 1 – Appraisal Report
FINDINGS OF FACT
1. Jurisdiction is proper. Complainant timely filed his appeal from the decision of the Jackson County Board of Equalization.
2. The subject property is a 4.27 acre
tract improved with a 27 year old 1.5 story ranch-style home containing 1,692
square feet. The property is identified
as parcel number 60-100-03-12 more commonly known as
3. Respondent notes that the exterior of the subject property suffers from deferred maintenance. The wood roof, siding on the east side, one garage door and several windows need to be replaced. The interior is slightly dated but has been well maintained and is in overall good condition. The carpet is slightly worn and dated and would need to be replaced to bring it up to date and appealing to a potential buyer. Respondent notes that Complainant estimated the cost to repair at $20,000.
4. Respondent’s appraiser found sales of three similar properties
which sold for $169,900, $229,000 and $184,900.
These properties were located between 2.31 and 6.61 miles from the
subject property. After adjustments for
site, location, condition, age, living area, basement finish, porches, fences,
and garages, these properties indicated a range of value for the subject
property between $159,750 and $172,880. Based
upon these sales, Respondent’s appraiser determined a market value for the
subject property of $168,000 on
5. Complainant presented no comparable sales but testified that his home was of very basic construction. He testified that his home was located across the road from the county maintenance yard and that the maintenance yard was an eyesore which detracted from the value of his home. He testified that he believed that his lot was closer to 3.58 acres than 4.27 acres and that a portion of his property was subject to flooding with runoff from 50 Highway. Finally, Complainant testified that his property was located in the country with no curbs or gas and he was on a septic tank rather than a sewer line.
6. No evidence was presented which
suggested that any new construction or property improvements occurred between
7. The true value in money for the subject
property on
January 1, 2006, is $168,000, as determined by Respondent.
CONCLUSIONS
OF LAW
Highest and Best Use
True
value in money is the fair market value of the property on the valuation date,
and is a function of its highest and best use, which is the use of the property
which will produce the greatest return in the reasonably near future. Aspenhof Corp. v. State Tax Commission,
789 S.W.2d 867, 869 (
It
is true that property can only be valued according to a use to which the
property is readily available. But this
does not mean that in order for a specific use to be the highest and best use
for calculating the property’s true value in money, that particular use must be
available to anyone deciding to purchase the property. . . .A determination of
the true value in money cannot reject the property’s highest and best use and
value the property at a lesser economic use of the property. Snider v. Casino Aztar/Aztar Missouri
Gaming Corp., 156 S.W.3d. 341, 348-349 (
True
Value in Money
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 purchased by one who is desiring 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 (
Taxpayer has Burden of Proof
In Westwood Partnership v. Gogarty, 103 S.W.3d 152 (Mo. App. E.D. 2003), the court of appeals stated:
There is no longer an automatic
presumption regarding the correctness of an assessor's valuation. Section
138.431.3. This statutory change from the previous situation in which the
assessor's valuation was presumed to be correct does not mean that there is now
a presumption in favor of taxpayer. The taxpayer in a Commission tax appeal
still bears the burden of proof and must show by a preponderance of the
evidence that the property was improperly classified or valued. Industrial
Development Authority of
In Reeves v. Snider, 115 S.W.3d 375 (Mo. App. S.D. 2003), the court of appeals described the taxpayer's burden as follows:
Taxpayers were the moving parties
seeking affirmative relief, and as such, they bore the burden of proving the vital
elements of their case, i.e., the assessments were "unlawful, unfair,
improper, arbitrary or capricious.” Cupples Hesse Corp. v. State Tax Comm'n,
329 S.W.2d 696, 702 (Mo.1959); Westwood P'ship v. Gogarty, 103 S.W.3d
152, 161[8] (
To
prevail, Taxpayers had to "present an opinion of market value and then ...
present substantial and persuasive evidence that the proposed value is
indicative of the market value of the subject property on tax day."
Daly v. P.D. George Co., 77 S.W.3d 645, 651 (
Substantial and Persuasive Evidence
Substantial
evidence is that evidence which, if true, has probative force upon the issues,
i.e., evidence favoring facts which are such that reasonable men may differ as
to whether it established them, and from which the Commission can reasonably
decide an appeal on the factual issues. Cupples-Hesse
Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (
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 (
Comparable Sales Approach
The
comparable sales approach uses prices paid for similar properties in arms-length
transactions and adjusts those prices to account for differences between the
properties. Comparable sales consist of
evidence of sales reasonably related in time and distance and involve land
comparable in character. This approach
is most appropriate when there is an active market for the type of property at
issue such that sufficient data is available to make a comparative
analysis. Snider v. Casino
Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341, 347-348 (
Experts
An
expert’s opinion must be founded upon substantial information, not mere
conjecture or speculation, and there must be a rational basis for the
opinion. Missouri Pipeline Co. v.
Wilmes, 898 S.W.2d 682, 687 (Mo. App. E.D. 1995). The state tax commission cannot ignore a
lack of support in the evidence for adjustments made by the expert witnesses in
the application of a particular valuation approach. Drey v. State Tax Commission, 345
S.W.2d 228, 234-236 (
The
testimony of an expert is to be considered like any other testimony, is to be
tried by the same test, and receives just so much weight and credit as the
trier of fact may deem it entitled to when viewed in connection with all other
circumstances. The hearing officer, as
the trier of fact, has the authority to weigh the evidence and 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 may accept it in part or
reject it in part. Beardsley v.
Beardsley, 819 S.W.2d 400, 403 (
DISCUSSION
In order to prevail, Complainant must present
an opinion of value and then present substantial and persuasive evidence
tending to demonstrate that his opinion of value is supported by market
evidence. Complainant has failed to meet
this burden of proof. The overwhelming
evidence suggests that Complainant’s property would sell for at least $168,000
as determined by the Respondent.
ORDER
The assessed value determined by the Board of Equalization, is SET ASIDE. The Clerk is ordered to place a new value of $168,000 (assessed value $31,920) on the subject property for tax years 2005 and 2006.
A party may file with the Commission an application for review of a hearing officer decision within thirty (30) days of the mailing of such decision. The application shall contain specific detailed 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.
If an application for review of a hearing officer 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 Jackson 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 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
_____________________________________
Luann Johnson
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been mailed postage prepaid this 22nd day of May, 2006, to: Steve Holland, 24609 E. Langsford Road, Lee’s Summit, MO 64063, Complainant; William Snyder, Deputy County Counselor, Jackson County Courthouse, 415 E. 12th Street, Room 200, Kansas City, MO 64106, Attorney for Respondent; Michael O’Flaherty, Director of Assessment; Mary Jo Spino, Clerk; Mike Pendergast, Director of Collections, Jackson County Courthouse, 415 E. 12th Street, Kansas City, MO 64106; and Bob Ensminger, Real Estate Records, City of Kansas City, 1st Floor, City Hall, 414 E. 12th Street, Kansas City, MO 64106.
_______________________________
Barbara Heller
Legal Coordinator