State Tax Commission of Missouri

WILLIAM J. LASOTA, )

)

Complainant, )

)

v. ) Appeal Number 07-62531

)

DON DAVIS, ASSESSOR, )

JASPER COUNTY, MISSOURI, )

)

Respondent. )

DECISION AND ORDER

HOLDING

Decision of the Jasper County Board of Equalization increasing the assessment made by the Assessor is AFFIRMED. Hearing Officer finds presumption of correct assessment not rebutted. True value in money for the subject property for tax years 2007 and 2008 is set at $232,300, residential assessed value of $44,140.

Complainant appeared pro se.

Respondent appeared by Counsel, Jeremy Crowley, Assistant Prosecuting Attorney.

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, 2007.

SUMMARY

Complainant appeals, on the ground of overvaluation, the decision of the Jasper County Board of Equalization, which increased the valuation of the subject property. The Assessor determined an appraised value of $248,240, assessed value of $47,170, as residential property on the 2007 Notice of Change in Value of Real Property. The Assessor reduced the value to $231,720, assessed value of $44,030, as the result of an informal hearing (9/21/2007). The Board increased the value to $232,300, assessed value of $44,140. Complainant proposed a value of $209,070, assessed value of $39,720. A hearing was conducted on February 6, 2008, at the Jasper County Courthouse Annex, Carthage, Missouri.

The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.

Complainant’s Evidence

Mr. Lasota testified as to his opinion of value of $209,070. This was based upon the taxpayer’s opinion that properties in the subject neighborhood were all valued for assessment purposes at 90% of sale price. The following exhibits were received into evidence on behalf of Complainant.

Exhibit A – Summary of basis of opinion of value

Exhibit B – Appeal Documents

Exhibit C – Purchase Documents

Exhibit D – Summary of Comparables

Exhibit E – Map of Carl Junction, Missouri

Respondent’s Evidence

Respondent offered into evidence the appraisal report (Exhibit 1) of Ms. Christine Meadows, appraiser for Respondent. The appraiser testified as to her appraisal of the subject property. Exhibit 1 was received into evidence. Exhibit 1 concluded on a value for the subject property of $232,300 based upon a cost analysis and the purchase price.

FINDINGS OF FACT

1. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission from the decision of the Jasper County Board of Equalization.

2. The subject property is located at 727 Harlee Circle, Carl Junction, Missouri. The property is identified by parcel number 16-5.0-16-10-001-076.000. The property was purchased in June, 2006 for $232,300. There was no evidence of new construction and improvement from January 1, 2007, to January 1, 2008.

3. Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the true value in money as of January 1, 2007, to be $209,070.

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 of correct assessment is rebutted when the taxpayer presents substantial and persuasive evidence to establish that the assessor/Board’s valuation is erroneous and what the fair market value should have been placed on the property. Snider, Hermel & Cupples Hesse, supra. Complainant’s testimony and exhibits failed to rebut the presumption of correct assessment.

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 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 are 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 both 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’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).

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’s opinion in the present appeal is based upon his assertion that homes in his neighborhood are valued by the Assessor at 90% of their sale price and therefore his property should be valued at $209,070. Even if Complainant’s evidence established such a practice by the Assessor, which it did not, it would not establish true value in money (fair market value).

Mr. Lasota presented some data on three properties which he believed were comparable to his property. However, there was nothing contained in the supporting documents to establish a policy by the Assessor to assess properties at only 90% of sales price. One property (726 Kara Lane) did not have a sales price. The second property (102 Van Dusen) did not have the Assessor’s appraised value. The third property gave an unsupported sales price of $288,000 and an Assessor’s appraised value of $258,700, but no documentation to verify that as the value used for the 2007 assessment. In sum, the taxpayer’s evidence totally failed to establish that it is the policy of the Assessor to value properties at only 90% of sale price.

The opinion of value offered by Mr. Lasota was not based upon proper elements or a proper foundation. It was not a methodology which has been recognized by either the Courts of Missouri or the Commission as appropriate for arriving at fair market value. Proper methods of valuation and assessment of property are delegated to the Commission. It is within the purview of the Hearing Officer to determine the method of valuation to be adopted in a given case. See, Nance v. STC, 18 S.W.3d 611, at 615 (Mo. App. W.D. 2000); Hermel, supra; Xerox Corp. v. STC, 529 S.W.2d 413 (Mo. banc 1975). 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).

Evidence of the actual sales price of property is admissible to establish value at the time of an assessment, provided that such evidence involves a voluntary purchase not too remote in time. The actual sale price is a method that may be considered for estimating true value. St. Joe Minerals Corp. v. STC, 854 S.W.2d 526 (App. E.D. 1993). The sale of the subject in June 2006 for $232,300 is substantial and persuasive evidence of fair market value for January 1, 2007.

No probative weight can be given to the opinion of value tendered by Mr. Lasota. The actual sales price rebuts Mr. Lasota’s proposed value. Complainant failed to meet his burden of proof and rebut the presumption of correct assessment and establish fair market value.

ORDER

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

The assessed value for the subject property for tax years 2007 and 2008 is set at $44,140.

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 and an order to the Collector to release and disburse the impounded taxes. §139.031.3 RSMo. 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 Jasper 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 February 26, 2008.

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 26^th day of February, 2008, to: William Lasota, 727 Harlee Circle, Carl Junction, MO 64834, Complainant; Dean Dankelson, Prosecuting Attorney, 601 Pearl, Room 100, Joplin, MO 64801, Attorney for Respondent; Donald Davis, Assessor, 302 S. Main Street, Carthage, MO 64836; Bonnie Earl, Clerk; Stephen Holt, Collector, Jasper County Courthouse, Carthage, MO 64836.

___________________________

Barbara Heller

Legal Coordinator