State Tax Commission of
DONALD J. ORF, )
)
Complainant, )
)
v. ) Appeal Number 05-32518
)
SCOTT SHIPMAN, ASSESSOR, )
)
Respondent. )
DECISION AND ORDER
HOLDING
Decision of the St. Charles County Board of Equalization sustaining the assessment made by the Assessor, AFFIRMED, true value in money for the subject property for tax years 2005 and 2006 set at $149,260, assessed value of $28,360.
Complainant appeared pro se.
Respondent appeared by Counsel, Charissa Mayes, Assistant 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. Charles County
Board of Equalization, which sustained the valuation of the subject
property. The Assessor determined an
appraised value of $149,260 (assessed value of $28,360, as residential
property). Complainant proposed a value
of $130,000 (assessed value of $24,700).
A hearing was conducted on February 28, 2005, at the
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. He stated his opinion of fair market value was $130,000. This was based on the condition of the subject home and certain items of deferred maintenance, including cracks in the garage floor, concrete patio and sidewalk and water leaks in the basement. Complainant also was concerned as to the amount of the increase in value from 2003 to 2005. The increase was from $123,000 to $149,260 or an increase of 21.35%. No evidence was tendered in support of the owner’s opinion.
Respondent’s Evidence
Respondent placed
into evidence the Appraisal Report (Exhibit
1) of Mr. Steven D. Riney, Supervisor of Residential Property for
Mr. Riney adjusted for various differences between each comparable and the subject. The adjustments as a percentage of sale prices of the comparables were less than 1%, 4.8%, 1.8%, 2.5% and less than 1% for the five properties. The five adjusted sales prices calculated to $152,740, $147,510, $155,920, $158,880 and $152,430. The median adjusted sales price was $152,740. Mr. Riney gave equal weight to each sale. The average adjusted sales price was $153,496, rounded to $153,500.
FINDINGS OF FACT
1. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission from the decision of the St. Charles County Board of Equalization.
2. The subject property is located at
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 and the Board and establish the true value in money as of January 1, 2005, to be $130,000, 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 properties were located within three (3) blocks of the subject. Each sale property sold at a time relevant (12/03 – 3/05) 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, location, site size and other amenities. Exhibit 1. The adjustments made by the appraiser to arrive at his conclusion of value were appropriate to bring the comparables in line with the subject for purposes of the appraisal problem.
6. Respondent’s evidence met the standard of clear and convincing evidence to establish the value of the subject, as of January 1, 2005, to be $149,260 and thereby substantiate the presumption of correct assessment by the Assessor and the Board.
CONCLUSIONS
OF LAW
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.
Board of Equalization Presumption
There is a
presumption of validity, good faith and correctness of assessment by the
Presumption on Assessor’s Value
The Supreme Court of Missouri has held, “A tax
assessor’s valuation is presumed correct.”
Donna Snider v. Casino Aztar/Aztar Missouri Gaming Corp.,
SC86181, 3/01/2005. Citing to Hermel,
supra; and Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d
696, 702 (
Rebutting
of Presumption of Correct Assessment
The
presumption of correct assessment is rebutted when the taxpayer presents
substantial and persuasive evidence 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 (
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. Exhibit 1, p. 4.
Opinion Testimony by Experts
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).
Complainant’s Burden of Proof
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 (
Owner’s Opinion of Value
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
Methods of Valuation
Evidence of Increase in Value
In any case in St. Charles 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.
DECISION
The owner’s opinion of fair market value may always be given in an appeal before the Commission. However, such opinion of value without substantial and persuasive evidence to support that opinion possesses no probative weight or benefit on the issue of fair market value. In the present case, Mr. Orf’s opinion is based on his concern as to the percentage of increase in valuation from one assessment cycle to the other. Without other evidence to establish the fair market value of Complainant’s property on January 1, 2005, it is reasonable to assume that the property was probably somewhat undervalued for the 2003-04 assessment cycle, as well as their was no doubt some inflationary increase in real property values in St. Charles County from 2003 to 2005.
As to the various items of deferred maintenance noted in the testimony of Mr. Orf, these items of course impact on fair market value, however, without a basis from which to make some calculations as to cost for repair and value of the home as it existed in January 2005, with these conditions, it cannot be concluded that the fair market value was as proposed by Mr. Orf. Furthermore, the items of deferred maintenance are items that one would expect to find in other homes of a similar age to the subject. It is noteworthy that Mr. Riney in his valuation of the subject was able to locate five sales of homes all in the subject neighborhood only 2 or 3 blocks away. All of these homes were constructed within 1 to 3 years of the subject. It is reasonable to conclude that these homes would have similar maintenance issues related to concrete cracks and basement leaks. Mr. Riney made no specific adjustment to any of the sale properties for the condition issues raised by Mr. Orf, because Mr. Riney judged each of the comparables to be of average construction and condition like the subject.
In the absence of substantial and persuasive evidence to establish a value of $130,000 as proposed by the taxpayer, the valuation determined by the Assessor and sustained by the Board is presumed correct. The Riney appraisal provided clear and convincing evidence to substantiate the Assessor and Board presumptions.
ORDER
The assessed
valuation for the subject property as determined by the Assessor and sustained
by the Board of Equalization for
The assessed value for the subject property for tax years 2005 and 2006 is set at $28,360.
Complainant 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. Charles 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 March 10, 2006.
STATE TAX COMMISSION OF
_____________________________________
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 10th day of March, 2006, to: Donald Orf, 2809 Blanchette, St. Charles, MO 63301, Complainant; Charissa Mayes, Assistant County Counselor, 100 North Third Street, Room 216, St. Charles, MO 63301, Attorney for Respondent; Scott Shipman, Assessor, 201 North Second, Room 247, St. Charles, MO 63301-2870; Amy Gann, Registrar, 100 North Third Street, Suite 206, St. Charles, MO 63301; Barbara Walker, Collector, 201 North Second Street, Room 134, St. Charles, MO 63301.
___________________________
Barbara Heller
Legal Coordinator