State Tax Commission of Missouri
|CHRISTOPHER J. VATTEROTT,||)|
|Appeal No. 15-13559
|JAKE ZIMMERMAN, ASSESSOR||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
DECISION AND ORDER
The assessment made by the Board of Equalization of St. Louis County (BOE) is AFFIRMED. Complainant Christopher J. Vatterott (Complainant) did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE. Assessed value in money for the subject property for tax years 2015 and 2016 is set at $230 residential ($1,200 true market value or TMV).
Complainant appeared pro se.
Respondent Jake Zimmerman, St. Louis County Assessor, (Respondent) appeared by attorney Steven Robson, Assistant County Counselor.
Case heard and decided by Senior Hearing Officer Amy S. Westermann.
Complainant appealed on the ground of overvaluation. Respondent initially set the true market value (TMV) of the subject property, as residential property, at $1,200. The BOE sustained Respondent’s valuation. The Commission takes this appeal to determine the TMV of the subject properties on January 1, 2015.
The Senior Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
FINDINGS OF FACT
- Jurisdiction. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission.
- Evidentiary Hearing. The issue of overvaluation was presented at an evidentiary hearing, which was held on May 25, 2016, at the St. Louis Government Administration Building, 41 South Central Avenue, Clayton, Missouri.
- Identification of Subject Property. The subject property is identified by parcel/locator number 12M341443. The subject property is further identified as 4100 Cypress Road, St. Ann, Missouri. (Exhibit A8; Exhibit 1)
- Description of Subject Property. The subject property is an approximately 3,920 square foot, irregularly-shaped, vacant parcel of land bounded on three sides by city streets: Cypress Road, St. Lawrence Lane, and International Plaza Drive. (Exhibit A6; Exhibit 2) The parcel’s two remaining lot lines adjoin a neighboring property’s lot lines. (Exhibit 2) The neighboring property includes a one-story brick house. (Exhibit A6) Complainant also owns the neighboring property.
- Assessment. Respondent set a TMV of $1,200, residential, as of January 1, 2015. (Exhibit 1)
- Board of Equalization. The BOE sustained Respondent’s TMV of the subject property.
- Complainant’s Evidence. Complainant testified in his own behalf. Complainant offered as evidence Exhibit A, which contained: (1) a copy of the Senior Hearing Officer’s Order on Filing of Complaint (Exhibit A1-A4); (2) a copy of a bid to purchase the subject property that Complainant had presented to the St. Louis County Department of Revenue’s Trustee Office on November 7, 2011 (Exhibit A5); (3) a copy of a hand drawn survey map of the subject property and surrounding streets and the adjoining property (Exhibit A6); a copy of a check drafted on the bank account of Complainant dated November 7, 2011, in the amount of $400 and paid to the St. Louis County Department of Revenue for the purchase of the subject property (Exhibit A7); and a copy of the change of assessment notice for the subject property dated June 26, 2015, and showing the appraised value to be $1,200 as of January 1, 2015 (Exhibit A8).
Complainant testified that he had purchased the subject property on November 7, 2011, after negotiating the price of $400 with the owner, St. Louis County. Complainant testified that he had purchased the property from St. Louis County after the property had been abandoned and had remained unsold following three years of tax sales. Complainant testified that he had purchased the property clear of any liens and back taxes and that the property was not encumbered by a mortgage. Complainant testified that, at the time of the evidentiary hearing, the subject property was on the market for sale in conjunction with the neighboring property that included the brick one-story house. Complainant testified that the subject property’s contribution to the value of the adjoining lot was negligible and possibly detracted from the overall asking price of $48,000. Complainant testified that he believed the subject property’s proximity to a public bus stop and problems with litter also detracted from its value and desirability. Complainant opined that the value of the subject property was $500 as of January 1, 2015. (Complaint)
Respondent did not object to Complainant’s exhibit, which was received into the record.
- Respondent’s Evidence. Respondent offered as evidence Exhibit 1, the Notice of Decision from the BOE, which sustained Respondent’s valuation of $1,200. (Exhibit 1) Respondent also offered as evidence Exhibit 2, a satellite map of the subject property, the neighboring property, and the streets bounding the subject property. (Exhibit 2)
Complainant did not object to Respondent’s evidence, which was received into the record.
CONCLUSIONS OF LAW AND DECISION
The Commission has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious, including the application of any abatement. The Senior 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. Article X, Section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo (2000) as amended.
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. Article X, Sections 4(a) and 4(b), Mo. Const. of 1945. The constitutional mandate is to find the true value in money for the property under appeal. By statute, real, and tangible personal property are assessed at set percentages of true value in money: residential property at 19% of true value in money; commercial property at 32% of true value in money; and agricultural property at 12% of true value in money. Section 137.115.5 RSMo (2000) as amended.
Weight to be Given Evidence
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).
Complainant’s Burden of Proof
To obtain a reduction in assessed valuation based upon an alleged overvaluation, the Complainant must prove the true value in money of the subject property on the subject tax day. Hermel, Inc., v. State Tax Commission, 564 S.W.2d 888, 897 (Mo. banc 1978). True value in money is defined as the price that the subject property would bring when offered for sale by one willing but not obligated to sell it and is bought by one willing or desirous to purchase but not compelled to do so. Rinehart v. Bateman, 363 S.W.3d 357, 365 Mo. App. W.D. 2012); Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008); Greene County v. Hermel, Inc., 511 S.W.2d 762, 771 (Mo. 1974). True value in money is defined in terms of value in exchange and not in terms of value in use. Stephen & Stephen Properties, Inc. v. State Tax Commission, 499 S.W.2d 798, 801-803 (Mo. 1973). In sum, true value in money is the fair market value of the subject property on the valuation date. Hermel, Inc., 564 S.W.2d at 897.
A presumption exists that the assessed value fixed by the BOE is correct. Rinehart, 363 S.W.3d at 367; Cohen, 251 S.W.3d at 348; Hermel, Inc., 564 S.W.2d at 895. “Substantial and persuasive controverting evidence is required to rebut the presumption, with the burden of proof resting on the taxpayer.” Cohen, 251 S.W.3d at 348. 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). 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).
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.” Westwood Partnership, 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).
Generally, a property owner, while not an expert, is competent to testify to the reasonable market value of his own land. Cohen, 251 S.W.3d at 348-49; Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992). “However, when an owner’s opinion is based on improper elements or foundation, his opinion loses its probative value.” Carmel Energy, Inc., 827 S.W.2d at 783. A taxpayer does not meet his burden if evidence on any essential element of his case leaves the Commission “in the nebulous twilight of speculation, conjecture and surmise.” See Rossman v. G.G.C. Corp. of Missouri, 596 S.W.2d 469, 471 (Mo. App. E.D. 1980).
Board Presumption and Computer-Assisted Presumption
There exists a presumption of correct assessment by the BOE. In charter counties or the City of St. Louis, there exists by statutory mandate a presumption that the Assessor’s original valuation was made by a computer, computer-assisted method or a computer program – the computer-assisted presumption. These two presumptions operate with regard to the parties in different ways. The BOE presumption operates in every case to require the taxpayer to present evidence to rebut it. If Respondent is seeking to prove a value different than that set by the BOE, then it also would be applicable to the Respondent. The computer-assisted presumption is applicable only if (1) the BOE lowered the value of the Assessor and Respondent is seeking to sustain the original assessment and (2) it has not been shown that the Assessor’s valuation was not the result of a computer assisted method. The BOE’s valuation is assumed to be an independent valuation.
In the present appeal, the BOE sustained the valuation of Respondent; therefore, the computer-assisted presumption is not applicable in the present appeal.
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. See, Nance v. STC, 18 S.W.3d 611, 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). The Supreme Court of Missouri has also held that 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., 854 S.W.2d at 529.
In the present appeal based upon overvaluation, Complainant failed to present substantial and persuasive evidence to rebut the presumption of true market value advocated by Respondent. First, Complainant did not utilize a recognized approach to valuing the property, i.e., the sales comparison approach, the cost approach, or the income approach. Second, Complainant’s testimony did not compel a conclusion that the subject property was worth $500. Although Complainant testified that he believed the subject property was of little to no monetary value, Complainant testified that, at the time of the evidentiary hearing, the subject property was being offered for sale in conjunction with the neighboring property with an overall asking price of $48,000. Complainant testified that the subject property added negligible value and might be detrimental to the sale of the neighboring property, but Complainant did not present any market data demonstrating that potential buyers viewed the subject property as a negative factor in deciding whether to purchase the overall property.
Complainant testified that he paid $400 for the property in 2011 when he purchased it from the St. Louis County Department of Revenue after the property had been abandoned and had remained unsold following three years of tax sales. However, there was no evidence establishing that $400 was the fair market value of the property at the time Complainant purchased it. Notably, Complainant testified that he purchased the property only after negotiating St. Louis County’s waiver of the unpaid back taxes and liens. The “market value means the fair value of the property as between one who wants to purchase and one who wants to sell, not what could be obtained under peculiar circumstances when a greater than its fair price could be obtained, nor its speculative value; not a value obtained from the necessities of another; nor, on the other hand is it to be limited to that price which the property would bring when forced off at auction under the hammer. It is what it would bring at a fair public sale, when one party wanted to sell and the other wanted buy.” Kansas City, W&NWR Co. v. Fisher, 49 Kans 18 (1892), as articulated by the Journal of Property Tax Assessment and Administration, A Guide to Foreclosure-Related Sales and Verification Procedures, Vol. 6, Issue 4 37-56 (2009). The sale of the subject property in this case constituted peculiar circumstances that did not necessarily reflect the fair market value of the property in 2011. By extension, the sale occurring in 2011 did not necessarily reflect the fair market value of the property as of January 1, 2015.
Consequently, although Complainant presented evidence to support his opinion of the subject property’s TMV, it is neither substantial nor persuasive because, if relied upon, the fact finder would be required to resort to speculation to conclude the TMV of the subject property on January 1, 2015, should be $500.
The true market valuation for the subject property as determined by Respondent for the subject tax day and sustained by the BOE is AFFIRMED.
The assessed value for the subject property for tax years 2015 and 2016 is set at $230 ($1,200 TMV).
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, MO 65102-0146, 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 application for review is based will result in summary denial. Section 138.432, RSMo
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 139.031.8, 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 July 11, 2016.
STATE TAX COMMISSION OF MISSOURI
Amy S. Westermann
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been electronically mailed or sent by U.S. Mail on this 11 day of July, 2016 to:
Christopher J Vatterott, firstname.lastname@example.org
Steven Robson, St. Louis County Associate County Counselor, SRobson@stlouisco.com