STATE TAX COMMISSION OF MISSOURI
| ROGER WELKER, | ) | Appeal No. 19-11176 |
| Complainant, | ) | Parcel No. 31J540185 |
| ) | ||
| ) | ||
| v. | ) | |
| ) | ||
| JAKE ZIMMERMAN, ASSESSOR, | ) | |
| ST. LOUIS COUNTY, MISSOURI, | ) | |
| Respondent. | ) |
ORDER AFFIRMING
HEARING OFFICER DECISION UPON APPLICATION FOR REVIEW
HOLDING
On June 4, 2021, Senior Hearing Officer Laura Stork-Elam (Hearing Officer) entered a Decision and Order (Decision) affirming the decision of the Board of Equalization of St. Louis County (BOE). Roger Welker (Complainant) subsequently filed an Application for Review of the Decision and Order of the Hearing Officer.
We AFFIRM the Decision and Order of the Hearing Officer. Segments of the Hearing Officer’s Decision and Order may have been incorporated into our Decision and Order without further reference.
FINDINGS OF FACT AND PROCEDURAL HISTORY
The subject property is identified by Parcel Locator No. 31J540185. The subject property is further identified as being located at 5250 Milburn Road in St. Louis County, Missouri. The subject property is a residential parcel of real property consisting of a .28 acre lot and 1,520 square foot single-family home. The home has three bedrooms, one and one-half bathrooms, and a full basement. Complainant received the lot in 1970, and the home was built in 1971.
Jake Zimmerman, Assessor of St. Louis County, (Respondent) valued the subject property at $194,800. Complainant appealed to the BOE, which affirmed Respondent’s assessed valuation. Complainant timely appealed to the State Tax Commission (STC) alleging that the subject property was overvalued. The Hearing Officer held an evidentiary hearing on July 22, 2020, at the Wainwright State Office Building in the City of St. Louis, Missouri. Complainant appeared pro se and attended in person. Respondent was represented by counsel Monique McNutt, who attended by WebEx video conference. Complainant and Respondent each presented evidence in the form of testimony and exhibits. The Hearing Officer issued the Decision and Order on June 4, 2021, affirming the BOE on the ground that Complainant failed to present substantial and persuasive evidence that the BOE’s valuation of the subject property was erroneous.
Complainant timely filed an Application for Review. The STC thereafter issued its Order allowing the Application for Review and granting Respondent time to file a response. Respondent did not file a response.
CONCLUSIONS OF LAW
Complainant’s Points on Review
Complainant alleged the Hearing Officer erred by finding:
- that Complainant did not produce substantial and persuasive evidence to establish that Respondent overvalued the subject property, and;
- that the BOE did not follow the proper process in determining the subject property’s value.
Standard of Review
A party subject to a Decision and Order of a hearing officer of the STC may file an application requesting the case be reviewed by the STC. Section 138.432[1]. The STC may then summarily allow or deny the request. Section 138.432. The STC may affirm, modify, reverse, set aside, deny, or remand to the Hearing Officer the Decision and Order of the Hearing Officer on the basis of the evidence previously submitted or based on additional evidence taken before the STC. Section 138.432.
Commission’s Ruling
For the reasons that follow, the Commission finds Complainant’s arguments to be unpersuasive. The Commission, having thoroughly reviewed the whole record and having considered the Hearing Officer’s Decision, and the Application for Review of Complainant, affirms the Hearing Officer’s decision.
There is a presumption of validity, good faith and correctness of assessment by the BOE. 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). This presumption is a rebuttable rather than a conclusive presumption. The presumption of correct assessment is rebutted when the taxpayer presents substantial and persuasive evidence to establish that the BOE’s valuation is erroneous and what fair market value should have been placed on the property. Id.
The taxpayer in a STC appeal bears the burden of proof. The taxpayer is the moving party seeking affirmative relief. Therefore, Complainant bears the burden of proving by substantial and persuasive evidence the vital elements of the case, i.e., the assessment was “unlawful, unfair, improper, arbitrary, or capricious.” See, 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); Industrial Development Authority of Kansas City v. State Tax Commission of Missouri, 804 S.W.2d 387, 392 (Mo. App. W.D. 1991). Substantial evidence can be defined as such relevant evidence that a reasonable mind might accept as adequate to support a conclusion. Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959). Persuasive evidence is evidence that has sufficient weight and probative value to convince the trier of fact. Cupples Hesse Corp., 329 S.W.2d at 702. 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).
The Hearing Officer is not bound by any single formula, rule, or method in determining true value in money and is free to consider all pertinent facts and estimates and give them such weight as reasonably they may be deemed entitled. The relative weight to be accorded any relevant factor in a particular case is for the Hearing Officer to decide. St. Louis County v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977); St. Louis County v. STC, 515 S.W.2d 446, 450 (Mo. 1974); Chicago, Burlington & Quincy Railroad Company v. STC, 436 S.W.2d 650 (Mo. 1968).
In his first point, Complainant claims that the Hearing Officer erred in finding the BOE’s valuation was correct because a natural gas pipeline and easement that runs through the subject property, which Complainant argues negatively impacts the true value in money (TVM) of the property. (Application for Review) The Hearing Officer found that despite Complainant’s testimony, which addressed the dangerousness of gas pipelines and how they impact the TVM of the subject property and Exhibits A through E regarding gas pipelines in other states and gas pipelines generally, Complainant did not produce evidence of any monetary impact that the pipeline had on the TVM of the subject property. The record supports the Hearing Officer’s finding.
In his second point, Complainant claims that the BOE failed to follow the proper process in determining the subject property’s value given the comments made by an employee of the BOE. Complainant asserts that the BOE employee’s comments indicated that the BOE did not consider the newspapers Complainant provided as evidence in making its decision and any resulting value without considering the newspapers should not be used. (Application for Review) Our review is limited to a review of the decision of the Hearing Officer and whether the Hearing Officer’s decision was supported by the evidence in the record. The Hearing Officer’s decision demonstrates that she considered all evidence and testimony provided by Complainant, including the newspaper articles.
The taxpayer in a STC appeal bears the burden of proof. The taxpayer is the moving party seeking affirmative relief. Therefore, in this appeal, Complainant had the burden of proving that the BOE’s valuation was erroneous and of establishing what should be the fair market value of the subject property. The Hearing Officer found that Complainant did not present substantial and persuasive evidence rebutting the BOE’s value and establishing the true value of the subject property as of January 1, 2019. The record supports the Hearing Officer’s finding. The Commission finds that a reasonable mind could have conscientiously reached the same result as the Hearing Officer based on a review of the entire record. Hermel, 564 S.W.2d at 895-96; Black v. Lombardi, 970 S.W.2d 378 (Mo. App. E.D. 1998). The Hearing Officer did not err in affirming the decision of the BOE.
ORDER
The Decision of the Hearing Officer is AFFIRMED.[2] The Decision and Order of the Hearing Officer, including the findings of fact and conclusions of law therein, is incorporated by reference, as if set out in full, in this final decision of the Commission.
Judicial review of this Order may be had in the manner provided in Sections 138.432 and 536.100 to 536.140 within 30 days of the mailing date set forth in the Certificate of Service for this Order.
If judicial review of this decision is made, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the courts unless disbursed pursuant to Section 139.031.8.
If no judicial review is made within 30 days, this decision and order is deemed final and the Collector of St. Louis 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.
SO ORDERED September 24, 2021.
STATE TAX COMMISSION OF MISSOURI
_____________________________________
Gary Romine, Chairman
_____________________________________
Victor Callahan, Commissioner
_____________________________________
Will Kraus, Commissioner
Certificate of Service
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid September 24, 2021, to:
Elaina Mejia
Legal Coordinator
STATE TAX COMMISSION OF MISSOURI
| ROGER WELKER, | ) | Appeal No. 19-11176 |
| Complainant, | ) | Parcel No. 31J540185 |
| ) | ||
| ) | ||
| v. | ) | |
| ) | ||
| JAKE ZIMMERMAN, ASSESSOR, | ) | |
| ST. LOUIS COUNTY, MISSOURI, | ) | |
| Respondent. | ) |
DECISION AND ORDER
Roger Welker (Complainant) appeals the St. Louis County Board of Equalization’s (BOE) decision finding the true value in money (TVM) of the subject property on January 1, 2019, was $194,800, with an assessed value of $37,010. Complainant claims the property is overvalued and proposes a value of $161,000. Complainant did not produce substantial and persuasive evidence establishing overvaluation. The BOE’s decision is affirmed.[3]
The evidentiary hearing was held on July 22, 2020, at the Wainwright State Office Building in the City of St. Louis, Missouri. Complainant appeared pro se and attended in person. Respondent was represented by counsel Monique McNutt, who attended by WebEx video conference.
FINDINGS OF FACT
- Subject Property. The subject property is located at 5250 Milburn Road in St. Louis, Missouri. The parcel/locator number is 31J540185.
The subject property consists of a .28 acre lot and 1,520 square foot single family home. The home has three bedrooms, one and one-half bathrooms, and a full basement. Complainant received the lot in 1970, and the home was built in 1971.
- Respondent and BOE. Respondent classified the subject property as residential and determined the TVM on January 1, 2019, was $194,800. The BOE classified the subject property as residential and independently determined the TVM on January 1, 2019, was $194,800.
- Complainant’s Evidence. Complainant testified that he believes the TVM of the subject property on January 1, 2019, was $161,000, the previous appraised value, and that a 50-foot easement for a 22-inch high pressure natural gas transmission line negatively impacts the value of the subject property. Complainant submitted (1) Exhibit A, a May 1, 2007, newspaper article titled “Pipeline blast’s cause still unknown” from The State Journal Register, a Springfield, Illinois newspaper; (2) Exhibit B, an undated newspaper article titled “ Pipeline explodes, Pawnee farmer worried about injuries to livestock” from The State Journal Register; (3) Exhibit C, a plat from the Guaranty Land Title Company that shows the Mississippi River Transmission Corporation easement; (4) Exhibit D, a copy of one page addressing underground pipelines from an emergency information book; and (5) Exhibit E, an Enable Mississippi River Transmission, LLC map dated as generated on March 16, 2020, that includes pipeline information.
Respondent’s attorney made relevance objections to Exhibits A and B, and made an objection that no expert was offered to testify as to Exhibit E. Those objections were overruled with an indication that they would be taken into account when determining the weight of the evidence. Exhibits C and D were received into evidence without objection.
Complainant testified that although Exhibits A and B discuss a different pipeline, they illustrate the tremendous damage that can occur when a natural gas transmission line ruptures. Complainant further testified that Exhibit C shows the location of the Mississippi River Transmission Corporation pipeline easement relative to the subject property and the neighboring property that he owns; Exhibit D illustrates how a normal pipeline easement looks today in contrast to the Mississippi River Transmission Corporation pipeline, which he believes was placed in 1929; and Exhibit E explains information about the Mississippi River Transmission Corporation pipeline location and specifications.
- Respondent’s Evidence. Respondent submitted (1) Exhibit 1, the BOE’s October 4, 2019, Findings and Notice of Decision, determining a $194,800 appraised value; (2) Exhibit 2, a computer generated Comparable Sales Analysis Report for Tax Year 2019; and (3) Exhibit 3, the property record card for the subject property. Complainant’s objections were overruled, and Exhibits 1, 2, and 3 were received into evidence.
Sharon Kuelker, who has been employed by Respondent as a residential appraiser senior since 2007 and as a residential appraiser since 2002, testified in support of the BOE’s value of $194,800. Ms. Kuelker indicated that she agreed with the market value of $194,800 based on the computer generated comparable sales found in Exhibit 2; she did not have a comparable property with a gas line on it that sold; and the subject property had not been for sale.
- Value. The TVM of the subject property on January 1, 2019, was $194,800, with an assessed value of $37,010.
CONCLUSIONS OF LAW
- Assessment and Valuation. Residential real property is assessed at 19% of its TVM as of January 1 of each odd-numbered year. Section 137.115.5(1)(a). “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.” Snider v. Casino Aztar/Aztar Mo. Gaming Corp., 156 S.W.3d 341, 346 (Mo. banc 2005) (internal quotation omitted). The fair market value is “the price which the property would bring from a willing buyer when offered for sale by a willing seller.” Mo. Baptist Children’s Home v. State Tax Comm’n, 867 S.W.2d 510, 512 (Mo. banc 1993). Determining the TVM is a factual issue for the STC. Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008). The “proper methods of valuation and assessment of property are delegated to the Commission.” Savage v. State Tax Comm’n, 722 S.W.2d 72, 75 (Mo. banc 1986).
“For purposes of levying property taxes, the value of real property is typically determined using one or more of three generally accepted approaches.” Snider, 156 S.W.3d at 346. The three generally accepted approaches are the cost approach, the income approach, and the comparable sales approach. Id. at 346-48; see also St. Louis Cty. v. Sec. Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977).
The comparable sales approach “is most appropriate when there is an active market for the type of property at issue such that sufficient data are available to make a comparative analysis.” Snider, 156 S.W.3d at 348. For this reason, the comparable sales approach is typically used to value residential property. “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.” Id. at 347-48 (internal quotation omitted). “Comparable sales consist of evidence of sales reasonably related in time and distance and involve land comparable in character.” Id. at 348.
- Evidence. The hearing officer is the finder of fact and determines the credibility and weight of the evidence. Kelly v. Mo. Dep’t of Soc. Servs., Family Support Div., 456 S.W.3d 107, 111 (Mo. App. W.D. 2015). The finder of fact in an administrative hearing determines the credibility and weight of expert testimony. Hornbeck v. Spectra Painting, Inc., 370 S.W.3d 624, 632 (Mo. banc 2012). “It is within the purview of the hearing officer to determine the method of valuation to be adopted in a given case.” Tibbs v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 9 (Mo. App. S.D. 2020). The hearing officer “may inquire of the owner of the property or of any other party to the appeal regarding any matter or issue relevant to the valuation, subclassification or assessment of the property.” Section 138.430.2.
- Complainant’s Burden of Proof. The taxpayer bears the burden of proof and must show by a preponderance of the evidence that the property was overvalued or misclassified. Westwood P’ship v. Gogarty, 103 S.W.3d 152, 161 (Mo. App. E.D. 2003). The BOE’s valuation is presumptively correct. Tibbs v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 7 (Mo. App. S.D. 2020). The “taxpayer may rebut this presumption by presenting substantial and persuasive evidence that the valuation is erroneous” and must prove “the value that should have been placed on the property.” Id. “Substantial evidence is that evidence which, if true, has probative force upon the issues, and from which the trier of fact can reasonably decide the case on the fact issues.” Savage, 722 S.W.2d at 77 (internal quotation omitted). Evidence is persuasive when it has “sufficient weight and probative value to convince the trier of fact.” Daly v. P.D. George Co., 77 S.W.3d 645, 651 (Mo. App. E.D. 2002); see also White v. Dir. of Revenue, 321 S.W.3d 298, 305 (Mo. banc 2010) (noting the burden of persuasion is the “party’s duty to convince the fact-finder to view the facts in a way that favors that party”).
- Complainant Did Not Prove Overvaluation. Complainant did not produce substantial and persuasive evidence establishing that the BOE’s valuation was erroneous and that his opinion of value, $161,000, was the TVM of the subject property as of January 1, 2019. Although Complainant addressed the dangerousness of gas pipelines in his testimony and Exhibits A, B, and D and the easement and characteristics of the specific natural gas pipeline that he alleges impacted the TVM of the subject property in his testimony and Exhibits C and E, Complainant did not produce evidence of any monetary impact that the pipeline had on the TVM of the subject property. Complainant testified that the subject home is in “excellent shape” and comparable to Respondent’s comparables except for the fact that the comparable properties do not have an easement for a natural gas pipeline. However, Complainant did not provide any alternative comparable sales to utilize in the comparable sales approach. Further, to the extent that Complainant contended that such easement is a difference between the subject property and comparable properties that required an adjustment when utilizing the comparable sales approach to determine the TVM of the subject property, neither the necessity for nor the amount of such an adjustment has been persuasively established.
Respondent, although not required to, presented persuasive evidence in support of the BOE’s valuation. Ms. Kuelker, a residential appraiser, testified that she agreed with the computer-generated comparables found in Exhibit 2 and that her opinion of value was $194,800, the same value for the subject property listed on Exhibit 2 and determined by the BOE.
CONCLUSION AND ORDER
The BOE decision is affirmed. The TVM of the subject property as of January 1, 2019, was $194,800 with an assessed value of $37,010.
Application for Review
A party may file with the Commission an application for review of this decision within 30 days of the mailing date set forth in the certificate of service for this decision. The application “shall contain specific detailed grounds upon which it is claimed the decision is erroneous.” Section 138.432. The application must be in writing, and may be mailed to the State Tax Commission, P.O. Box 146, Jefferson City, MO 65102-0146, or emailed to Legal@stc.mo.gov. A copy of the application must be sent to each person listed below in the certificate of service.
Failure to state specific facts or law upon which the application for review is based will result in summary denial. Section 138.432.
Disputed Taxes
The Collector of St. Louis County, as well as the collectors of all affected political subdivisions therein, shall continue to hold the disputed taxes pending the possible filing of an application for review, unless said taxes have been disbursed pursuant to a court order under the provisions of section 139.031.
SO ORDERED June 4, 2021.
Laura A. Storck-Elam
Senior Hearing Officer
State Tax Commission
Certificate of Service
I hereby certify that a copy of the foregoing has been electronically mailed and/or sent by U.S. Mail on June 4, 2021, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
Elaina Mejia
Legal Coordinator
[1] All statutory citations are to RSMo. 2000, as amended, unless indicated otherwise.
[2] Missouri operates on a two-year reassessment cycle for valuing real property. See Section 137.115.1. Absent new construction or improvements to a parcel of real property, the assessed value as of January 1 of the odd year remains the assessed value as of January 1 of the following even year. Id.
[3] Complainant timely filed a complaint for review of assessment. The State Tax Commission (STC) has authority to hear and decide Complainant’s appeal. Mo. Const. art. X, Section 14; section 138.430.1, RSMo 2000. All statutory citations are to RSMo 2000, as amended.