State Tax Commission of Missouri

 

GARY & JEAN HARMON,                           )

)

Complainants,               )

)

v.                                                         )           Appeal Number 05-20143

)

ED BUSHMEYER, ASSESSOR,                    )

ST. LOUIS CITY, MISSOURI,                      )

)

 Respondent.                )

 

 

DECISION AND ORDER

 

HOLDING

 

Decision of the St. Louis City Board of Equalization sustaining the assessment made by the Assessor is AFFIRMED.  Hearing Officer finds presumptions of correct assessment not rebutted. True value in money for the subject property for tax years 2005 and 2006 is set at $74,690, assessed value of $23,900, as commercial property

Complainant Gary Harmon appeared pro se.

Respondent appeared by Counsel, Carl W. Yates III, Associate City 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

Complainants appeal, on the ground of overvaluation, the decision of the St. Louis City Board of Equalization, which sustained the valuation of the subject property.  The Assessor determined an appraised value of $74,690, assessed value of $23,900, as residential property.  Complainant proposed a value of $44,540, assessed value of $14,250.  A hearing was conducted on Wednesday December 13, 2006, at the St. Louis City Hall, Room 120 – Assessor’s Conference Room, St. Louis, 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 offered into evidence the following exhibits and written direct testimony:

            Exhibit A – Copy of page 2 of appraisal report, dated May 28, 1998.

            Exhibit B – Copy of Q & A 18 – 26 of Respondent’s Exhibit 2 – Written Direct Testimony of Maria J. Thorpes.

 

            Exhibit C – Copy of page 2 of Respondent’s Exhibit 1 – Appraisal Report of Maria J. Thorpes, with handwritten notes.

 

            Exhibit D – Copies of two photographs from Exhibit 1.

            Exhibit E – Copy of page 18 from Exhibit 1.

            Exhibit F – Copy of two photographs with handwritten notation – Columbia & January.

            Exhibit G – Copy of photographs with handwritten notation – 2200 59th.

            Exhibit H – Copy of photograph with handwritten notation – 1720 Macklind.

            Exhibit I – Copy of letter dated, August 22, 2006 to Complainant, Re: Comparable Sales.

            Exhibit J – Copy of Change of Assessment Notice dated, April 1, 2005.

            Exhibit K – Copy of letter dated October 13, 2004, to Respondent from State Tax Commission, with handwritten notations.

 

            Exhibit L – Copy of letter to State Tax Commission from Complainant filed with Complaint for Review of Assessment, with handwritten correction of amount paid for subject property in 1998.

 

            Exhibit M – Copy of Board Decision filed with Complaint for Review of Assessment.

            Exhibit N - Copy of same document filed as Exhibit L.

            Exhibit O – Written Direct Testimony of Gary Harmon (references to exhibits by number have been corrected to letters by the Hearing Officer).

 

            Exhibits A through O were received into evidence.

Respondent’s Evidence

Respondent offered into evidence the following exhibits and written direct testimony:

Exhibit 1 – Appraisal Report of Maria J. Thorpes, Real Property Appraisal Supervisor for Respondent.

 

Exhibit 2 – Written Direct Testimony of Ms. Thorpes.

 

Exhibits 1 and 2 were received into evidence.  Exhibits 1 & 2 opined a fair market value for the subject property as of January 1, 2005, of $78,000.  This opinion of value was given in support of the Assessor’s original value which had been sustained by the Board of Equalization.  It was not offered to advocate an increase in value above $74,690.

Respondent also offered the testimony of John Gilbert, Real Estate Appraisal Manager for the St. Louis City Assessor.

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 City Board of Equalization.

2.         The subject property is located at 5251 Pattison Avenue, St. Louis, Missouri.  The property is identified by parcel number 4078-00-0360-0.  The property consists of .064 of an acre lot, more or less (2,780 square feet).  The lot is improved by a one-story predominantly brick building used as an office, workshop and mini-warehouse for a graphic art business.  The gross building area, including a partial basement is approximately 3,314 square feet, with a net usable area of approximately 2,300 square feet.  Part of the building dates from just after the turn of the 19th century, the remainder of the building was added in 1950.  Exhibit 1, pp. 2 & 4.

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 presumptions of correct assessment by the Board and establish the true value in money as of January 1, 2005, to be $44,540.

5.         Respondent’s appraisal was accepted only to sustain the original assessment made by the Assessor and not for the purpose of raising the assessment above that value.

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 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 the taxpayer presents substantial and persuasive evidence to establish that the assessor’s and Board’s valuation is erroneous and what the fair market value should have been placed on the property.  Snider, Hermel & Cupples Hesse, supra.

Evidence of Increase in Value

In any case in St. Louis City 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.

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; Exhibit 1, p. 3.

Complainants Fail To Meet Burden of Proof

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, 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).

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). 

Complainants failed to meet the burden of proof required to prevail in this appeal.  The exhibits and Mr. Harmon’s testimony fail to establish the fair market value of the subject property as of January 1, 2005.  Complainants presented no evidence of fair market value by a recognized methodology for an ad valorem appeal before the Commission.  An owner’s opinion of value unsubstantiated by either a recent sale or an appraisal of the property provides no foundation to establish value.  Complainants’ opinion of value was not based upon proper elements.  No probative value can be given to the opinion that a willing buyer and seller would have agreed to a purchase price of $44,540 on January 1, 2005.

The Complainants having failed to meet their burden of proof there is no need to analyze the valuation of the property as developed in Exhibit 1.  The presumptions of correct assessed having not been rebutted stand.  The value established by the assessor and sustained by the Board of $74,690 remains as the true value in money for the property for the 2005-2006 assessment cycle.

ORDER

The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for St. Louis City for the subject tax day is AFFIRMED.

The assessed value for the subject property for tax years 2005 and 2006 is set at $23,900.

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 City, 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 January 17, 2007.

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 17th  day of January, 2007, to:     Gary Harmon, 320 West Lake Drive, Edwardsville, IL 62024,  Complainant; Carl W. Yates III, Associate City Counselor, 314 City Hall, St. Louis, MO 63103, Attorney for Respondent; Ed Bushmeyer, Assessor, 120 City Hall, St. Louis, MO 63103; Ronald Leggett, Collector, 110 City Hall, St. Louis, MO 63103.

 

 

___________________________

Barbara Heller

Legal Coordinator