State Tax Commission of Missouri

 

HOENER ASSOCIATES,                               )

)

Complainant,                )

)

v.                                                         )           Appeal Number 07-20007

)                        

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, AFFIRMED, Hearing Officer finds true value in money for the subject property for tax years 2007 and 2008 to be $119,400, assessed value of $22,690.

Complainant appeared by Bruce Dell.

Respondent appeared by Counsel, Carl W. Yates, III, Associate County Counselor.

Case heard and decided by Hearing Officer Maureen Monaghan.

ISSUE

The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2007.

SUMMARY

Complainant appeals, 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 $119,400, assessed value of $22,690, as residential property.  Complainant proposed a value of $90,000, assessed value of $22,690.  A hearing was conducted on January 23, 2008, at the St. Louis City Hall, 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

            The following exhibits were offered into evidence on behalf of the Complainant.

            Exhibit A – Photographs of Subject Property

            Exhibit B – Estimate of Repairs as Prepared by the Owner

            Exhibit A was received into evidence.  Respondent objected to Exhibit B for lack of foundation.  Said objection was sustained. 

            Testimony of Bruce Dell.

Respondent’s Evidence

The following exhibits were offered into evidence on behalf of the Respondent.

Exhibit 1 – Appraisal of Subject Property

All Exhibits were received into evidence.

Testimony of Tim Keller.

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 6711 Plainview, St. Louis, Missouri.  The property is identified by parcel number 5490-00-0250-0.  The property consists of a lot measuring 35 feet by 125 feet. The lot is improved by a single-story brick, single-family structure.  The house was built in 1941 and appears to be in fair condition.  The residence has 1,008 square feet of living area.  There is a full unfinished basement and a one-car garage.

3.         There was no evidence of new construction and improvement from January 1, 2007, to January 1, 2008.

4.         Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board.

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 blocks of the subject, one being on the same street.  Each sale property sold at a time relevant to the tax date of January 1, 2007.  The sale properties were similar to the subject.  The appraiser properly adjusted for differences between the subject and each sale property.  The adjustments made were appropriate for the present appraisal problem.

6.         Respondent’s evidence met the standard of substantial and persuasive to establish the value of the subject, as of January 1, 2007, to be $119,400 and sustain the Assessor and the Board.  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

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 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).

Presumption on Assessor’s Value

            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, 348-349 (Mo. 2005).  Citing to Hermel, supra; and Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).

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 (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, pp. 3-4.

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, 2007.  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).

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 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965). 

The owner testified that the property was purchased in August 2006 (five months prior to the tax date of January 1, 2007) for $120,000.  The owner testified that he purchased the property as a “tear down” for an addition to his property for Hoener Associates, Inc., Architects, a firm that specializes in educational property.  The property had not been condemned and had people residing in the structure until approximately one year before his purchase. 

The owner provided photographs showing a steel rod used for repair of the property and the cracks throughout the building.  The photographs also depicted the condition of the bricks, the need for tuck pointing, and condition of the porch. 

The Complainant failed to provide evidence as to market value of the property or comparable properties.

Methods of Valuation

Missouri courts have approved the comparable sales or market approach, the cost approach 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).

Assessor’s Opinion of Value

The Assessor presented the testimony of Tim Keller, a real property appraiser at the St. Louis Assessor’s Office.  Mr. Keller presented an appraisal of the subject property.  Mr. Keller used the sales comparison approach as it is the most indicative of buyers and sellers in the market place.  Mr. Keller found three sales within three blocks of the subject property and the sales occurred in August of 2005.  The properties sold from between $132,500 and $170,500.  Downward adjustments were made for the view, condition, gross living area and finished of basement.  Upward adjustments were made for square footage and porches.  After all adjustments were made, a final value of $126,000 was determined.

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 appraiser properly adjusted for differences between the subject and each sale property.  The adjustments made were appropriate for the present appraisal problem. Although no adjustments were made for the date of sale of the comparable properties, the sale of the subject property five months prior to the tax date of January 1, 2007 for $120,000 is substantial and persuasive evidence of the market value of the property.

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.

DECISION

Complainant failed to meet his burden of proof.  There was no substantial and persuasive evidence provided to support the fair market value of $90,000 proffered by Complainant. 

The owner failed to rebut the presumptions of correct assessment, therefore the assessment as made by the Assessor and sustained by the Board must be affirmed.

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 2007 and 2008 is set at $22,690.

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 February 5, 2008.

STATE TAX COMMISSION OF MISSOURI

 

 

_____________________________________

Maureen Monaghan

Hearing Officer

 

 

 

 

 

 

Certificate of Service

 

I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 5th  day of February, 2008, to: Bruce Dell, 6707 Plainview Ave., St. Louis, MO 63109,  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; Gregory Daly, Collector, 110 City Hall, St. Louis, MO 63103.

 

 

___________________________

Barbara Heller

Legal Coordinator