Charles Johnson v. Brooks (SLCO)

 

CHARLES JOHNSON,)

)

Complainant,)

)

v.) Appeal Number 09-10300

)

MICHAEL BROOKS, ACTING ASSESSOR,)

ST. LOUIS COUNTY,MISSOURI,)

)

Respondent.)

 

 

DECISION AND ORDER

 

HOLDING

 

Decision of the St. Louis 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 $675,000, residential assessed value of $128,250.Complainant appeared pro se.Respondent appeared by Associate County Counselor Paula J. Lemerman.

Case heard and decided by Senior Hearing Officer W. B. Tichenor.

ISSUE

Complainant appeals, on the ground of overvaluation and discrimination, the decision of the St. Louis County Board of Equalization, which sustained the valuation of the subject property.The Commission takes this appeal to determine (1) the true value in money for the subject property on January 1, 2009; and (2) whether there was an intentional plan by the assessing officials to assess the property under appeal at a ratio greater than 19% of true value in money, or at a ratio greater than the average 2009 residential assessment ratio for St. Louis

County.[1]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 St. Louis County Board of Equalization.A hearing was conducted on October 12, 2010, at the St. LouisCountyGovernmentCenter,Clayton,Missouri.

2.Assessment.The Assessor appraised the property under appeal at $728,700, a residential assessed value of $138,460.The Board sustained the assessment.[2]

3.Subject Property.The subject property is located at 12 Flynn Forest Lane, Glendale, Missouri.The property is identified by locator number 22L141005.The property consists of a 12,690 square foot lot.The lot is improved with a two-story colonial style, single-family residence that was built in 1996.The gross living area is 3,840 square feet.There is a full basement with 1,300 square feet of finish, including a fourth full bath.The exterior is brick veneer on three sides, with pre-painted siding on the back of the home.The home has a three car attached garage with one side and two rear-entry access.The residence has a total of ten rooms, four bedrooms, three full and one half bath above grade.The structure is in good condition, and the quality of the materials and the workmanship appear to be consistent with surrounding properties.No functional obsolescence exists and there is no significant deferred maintenance.[3]

4.Complainant’s Evidence.Mr. Johnson testified in his own behalf.He gave his opinion of value to be $633,000.This was based upon his conclusions and information contained in Exhibits A, B and G.The following exhibits were filed with the Commission and exchanged with Counsel for Respondent prior to the evidentiary hearing.[4]

 

EXHIBIT[5]	DESCRIPTION	DISPOSITION
A	Flynn Forest Subdivision Assessment Comparison	Received
B	Flynn Forest Subdivision Assessment Analysis	Received
C	Flynn Forest Subdivision Assessed Values v. Sales Price	Obj. – Sustained
D	Flynn Forest Subdivision Sales Comps 2009 Assessment cycle	Obj. – Sustained
E	Sales over $700,000 within 1 mile of 12 Flynn Forest	Obj. – Sustained
F	Mass Appraisal Comparable Sales – 613 Wyndham Crossing Cir.	Withdrawn
G	2009 Appraisal Cycle – Brookhaven Court	Received
L	Photograph 12 Flynn Forest	Received
M	Photograph 12708 Wyndbush	Withdrawn
N	Photograph 12 Gramercy Place	Received
O	Photograph 624 Wyndham Crossing	Withdrawn
P	Photograph 673 Wyndham Crossing	Withdrawn

 

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.[6]

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, 2009, to be $633,000, as proposed.[7]

5.Respondent’s Evidence.The following exhibits were filed with the Commission and exchanged with Complainant prior to the evidentiary hearing.

 

Mr. Armstrong testified in support of his appraisal.The properties relied upon by Respondent’s appraiser were comparable to the subject property for the purpose of making a determination of value of the subject property. The properties were located within less than a mile of the subject.Each sale property sold at a time relevant to the tax date of January 1, 2009.The sale properties were similar to the subject in style, quality of construction, age, condition, room, bedroom and bathroom count, living area, location, site size and other amenities of comparability.The appraiser made various adjustments to the comparable properties for differences which existed between the subject and each comparable.All adjustments were appropriate to bring the comparables in line with the subject for purposes of the appraisal problem.

Respondent’s evidence met the standard of substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the value of the subject, as of January 1, 2009, to be $675,000.

6.Assessed Value.The subject property being residential property must be assessed at 19% of its true value in money[8], or $128,250.

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.[9]

Basis of Assessment

The Constitution mandates that real property and tangible personal property be assessed at its value or such percentage of its value as may be fixed by law for each class and for each subclass.[10]The constitutional mandate is to find the true value in money for the property under appeal.By statute real and tangible personal property is assessed at set percentages of true value in money.[11]In an overvaluation appeal, true value in money for the property being appealed must be determined based upon the evidence on the record that is probative on the issue of the fair market value of the property under appeal.

Presumption In Appeals

There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.[12]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, or Respondent when advocating a value different than the value set by the Board, 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.[13]Complainant’s evidence failed to rebut the presumption of correct assessment by the Board.Respondent presented substantial and persuasive evidence that rebutted the presumption of correct assessment and established value.

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.[14]True value in money is defined in terms of value in exchange and not value in use.[15]It is the fair market value of the subject property on the valuation date.[16]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.[17]

 

The conclusion of value made by Mr. Armstrong was based upon the Standard For Valuation.[18]Complainant’s evidence presented on the issue of value did not come under the required standard.

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.[19]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.[20] Complainant failed to present an opinion of the fair market value of his property based upon any of the accepted appraisal methodologies.Respondent’s appraiser concluded value relying on the sales comparison approach.

Complainant Failed To Prove Value of $633,000

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.[21]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.”[22]

Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[23]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.[24]

The owner of property is generally held competent to testify to its reasonable market value.[25]The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.[26]As will be addressed below in the examination of Complainant’s exhibits, the owner’s opinion was not founded upon any accepted appraisal approach.The opinion was not based upon proper elements or a proper foundation to arrive at what a willing buyer and seller would have agreed to as the purchase price of the property on January 1, 2009.Accordingly, Complainant’s exhibits and testimony provided no probative evidence on the issue of overvaluation or the claim of discrimination.

Exhibits

Complainant’s exhibits failed to provide substantial and persuasive evidence to either prove the fair market value of the property on January 1, 2009, or to establish a claim of discrimination.The documents developed by Mr. Johnson were simply not relevant to the issues in the appeal.

Exhibits A, B & G – Overvaluation Issue

Exhibits A, B and G were received into evidence in order to permit the owner to explain the basis for his opinion of value.However, they are not probative on the issue of true value in money on January 1, 2009, for the property under appeal.Likewise, as will be addressed below, these exhibits are not relevant to the claim of discrimination.

Exhibit A provided assessment information on the fourteen properties in the Flynn Forest Subdivision relative to the 2007 and 2009 appraisals by the Assessor’s o

ffice.Information was also provided on the changes to valuations to eleven properties after an appeal of the original assessment was made in 2009.The exhibit provides nothing that is recognized as a proper appraisal methodology for ad valorem tax purposes.Comparing assessments with neighboring properties is not accepted as a proper approach to appraise a property i