State Tax Commission of Missouri
CAPITAL BANK OF PERRYVILLE,)
)
Complainant,)
)
v.)Appeal Number 09-77000
)
CHARLES TRILLER, ASSESSOR,)
PERRY COUNTY, MISSOURI,)
)
Respondent.)
ORDER CORRECTING DECISION NUNC PRO TUNC
Decision issued September 3, 2010 is corrected nunc pro tunc, as follows:
On page 3 of the Decision, Finding of Fact 6, the figure “$173,470” is stricken, and the figure “$292,160” is inserted in lieu thereof.In all other respects the Decision is affirmed as issued.
SO ORDERED September 15, 2010.
STATE TAX COMMISSION OF MISSOURI
W. B. Tichenor
Senior Hearing Officer
DECISION AND ORDER
HOLDING
Decision of the Perry County Board of Equalization sustaining the assessment made by the Assessor is SET ASIDE.True value in money for the subject property for tax years 2009 and 2010 is set at $913,000, commercial assessed value of $292,160.Complainant appeared by Counsel, Vickie Cochran, St. Louis, Missouri.Respondent appeared by Counsel, Thomas Hoeh, Prosecuting Attorney Perry County, Perryville, Missouri.
Case decided by Senior Hearing Officer W. B. Tichenor.
ISSUE
Complainant appeals, on the ground of overvaluation, the decision of the Perry County Board of Equalization, which sustained the valuation of the subject property.The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2009.The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
FINDINGS OF FACT
1.Jurisdiction.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the decision of the Perry County Board of Equalization.Case submitted on exhibits.[1]
2.Assessment.The Assessor appraised the property at $1,210,987, a commercial assessed value of $387,513.The Board sustained the assessment.[2]
3.Subject Property.The subject property is located at 320 N. Main, Perryville, Missouri.The property is identified by map parcel number 76-10-4-19-2-1-43.[3]The property consists of a 1.133 acre tract.[4]The land is improved with a one story masonry and masonry veneer commercial bank building.The building has been constructed in phrases, starting in 1969 with additions in 1991 and 1994.The structure was updated in 2008, with new floor coverings, new teller line, wall coverings and ceiling tile.The building has 8,297 square feet of gross building area above grade,[5] including 9 private offices, 4 teller windows, a large lobby, 3 record vaults, a safe deposit box vault, a board rooms, and several work areas.The building has a 1012 square foot canopy cover for drive up lanes, and a partially finished 1,680 square foot basement.[6]
4.Complainant’s Evidence.Complainant offered into evidence Exhibit A – Summary Appraisal of Steve Vertin, MAI, Missouri Certified General Temporary Real Estate Appraiser.Mr. Vertin concluded an estimated value for the subject property as of January 1, 2009, of $290,000.Exhibit A was received into evidence.[7]There was no evidence of new construction and improvement from January 1, 2009, to January 1, 2010, therefore the assessed value for 2009 remains the assessed value for 2010.[8]Complainant failed to present substantial and persuasive evidence to establish the fair market value of the subject property as of January 1, 2009.See, Complainant Failed to Prove Value of $290,000, infra.
5.Respondent’s Evidence.Respondent offered into evidence Exhibit 1 – Summary Appraisal of James N. Southard, Missouri Certified General Real Estate Appraiser.Mr. Southard concluded an estimated value for the subject property as of January 1, 2009, of $913,000.Exhibit 1 was received into evidence.[9]Respondent presented substantial and persuasive evidence to prove the fair market value of the subject property as of January 1, 2009 to be $913,000.See, Respondent Proves Value of $913,000, infra.
6.True Value in Money and Assessed Value.The true value in money of the subject property as of January 1, 2009, is set at $913,000, a commercial assessed value of $173,470.
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.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.[10]
Presumption In Appeals
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.[11]This presumption is a rebuttable rather than a conclusive presumption.It places the burden of going forward with some substantial evidence on the taxpayer – Complainant.The presumption of correct assessment is rebutted when the taxpayer presents substantial and persuasive evidence to establish that the Board’s valuation is erroneous and what the fair market value should have been placed on the property.[12]Complainant’s evidence[13] failed to rebut the presumption in favor of the Board’s value.Respondent’s evidence[14] rebutted the presumption of correct assessment.The case is decided free of the presumption.
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.[15]True value in money is defined in terms of value in exchange and not value in use.[16]It is the fair market value of the subject property on the valuation date.[17]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.[18]
Both appraisers concluded value under the Standard for Valuation.[19]
Methods of Valuation
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.[20]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.[21] Complainant’s appraiser concluded value after development of the sales comparison and income approaches.Respondent’s appraiser concluded value after development of the cost, sales comparison and income approaches.Accordingly, both appraisers have presented a conclusion of value derived from well recognized and accepted valuation methodologies for ad valorem appeals before the Commission.
Complainant Fails to Prove Value of $290,000
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, 2009.[22]There is no presumption that the taxpayer’s opinion is correct. The taxpayer in a Commission appeal still bears the burden of proof.The taxpayer is the moving party seeking affirmative relief.Therefore, the Complainant bears the burden of proving the vital elements of the case, i.e., the assessment was “unlawful, unfair, improper, arbitrary or capricious.”[23]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[24]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.[25]
The opinion of value of $290,000 opined via the appraisal report of Mr. Vertin is based upon an erroneous assumption.The appraiser valued a property with a building containing 4,836 square feet of built-out above grade area.[26]The calculation of an indicated value under the sales comparison approach applied the concluded per square foot value of $60 to the area of the building of 4,836 square feet.[27]In like manner the potential gross income calculated for the income approach of $9.50 per square foot was applied to the area of 4,836 square feet.[28]
The evidence presented on behalf of Respondent in the form of the floor plan[29] of the subject building established that the above grade area of the Complainant’s building is 8,298.Therefore, the indicated values presented in Exhibit A will not correlate to the subject property.No probative weight can be given to Exhibit A.Complainant failed to meet its burden of proof and establish a value of $290,000 as of January 1, 2009, for the subject property.
Respondent Proves Value of $913,000
Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the Board of Equalization, must meet the same burden of proof to present substantial and persuasive evidence of the value advocated as required of the Complainant under the principles established by case law.[30]The Southard appraisal provided substantial and persuasive evidence in the form of development of the three recognized approaches to value and reconciliation of the approaches to establish the true value in money for the subject property as of January 1, 2009, to be $913,000.
ORDER
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for Perry County for the subject tax day is SET ASIDE.
The assessed value for the subject property for tax years 2009 and 2010 is set at $292,160.
Application for Review
A party may file with the Commission an application for review of this decision within thirty days of the mailing date set forth in the Certificate of Service for this Decision.The application shall contain specific facts or law as grounds upon which it is claimed the decision is erroneous.Said application must be in writing addressed to the State Tax Commission of Missouri, P.O. Box 146, Jefferson City, MO65102-0146, and a copy of said application must be sent to each person at the address listed below in the certificate of service.
Failure to state specific facts or law upon which the appeal is based will result in summary denial. [31]
Disputed Taxes
The Collector of Perry 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 139.031.8, RSMo.
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 September 3, 2010.
STATE TAX COMMISSION OFMISSOURI
W. B. Tichenor
Senior Hearing Officer
[1] Neither party submitted written direct testimony.See Order Assigning Hearing Officer and Taking Appeal Under Advisement for Issuance of Decisions, dated August 4, 2010.
[11] 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)
[12] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959)
[15] 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).
[16] Daly v. P. D. George Company, et al, 77 S.W.3d 645, 649 (Mo. App E.D. 2002), citing, Equitable Life Assurance Society v. STC, 852 S.W.2d 376, 380 (Mo. App. 1993); citing, Stephen & Stephen Properties, Inc. v. STC, 499 S.W.2d 798, 801-803 (Mo. 1973).
[18] 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.
[20] 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).
[21] 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).
[23] 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. 1991).