STATE TAX COMMISSION OF MISSOURI
|Complainant,||)||Appeal No. 21-18360|
|)||Parcel No. 22N321140|
|JAKE ZIMMERMAN, ASSESSOR,||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
DECISION AND ORDER
Daryoush Aliakbari (Complainant) appeals the St. Louis County Board of Equalization’s (Respondent) decision valuing the subject residential property at $247,700 as of January 1, 2021. Complainant alleges overvaluation and asserts the true value in money (TVM) of the subject property as $212,000 as of January 1, 2021. The BOE decision is affirmed.
FINDINGS OF FACT
- The Subject Property. The subject residential property consists of a lot improved with a single-family home located at 956 Cleveland Avenue in Kirkwood, Missouri.
- Assessment and Valuation. Respondent determined the subject property’s appraised value was $330,700 as of January 1, 2021. The BOE determined the subject’s appraised value as of January 1, 2021, was $247,700.
- Complainant’s Evidence. Complainant introduced Exhibits A and B. Exhibit A is a proposed sale contract dated March 5, 2022, in which Prestige Custom Homes, Inc., offered to purchase the subject property for $200,000. Complainant did not sign the sale contract.
Exhibit B is an assessment notice showing Respondent determined the value of the adjacent property at 952 Cleveland was $260,000 as of January 1, 2021. Exhibits A and B were admitted into evidence.
Complainant testified the $200,000 sale contract and Respondent’s $260,000 assessment of the adjacent property at 952 Cleveland demonstrate the BOE’s $247,700 value is excessive and supports his proposed value of $212,000. Complainant testified the property at 952 Cleveland is larger and more desirable than the subject. Complainant asserted that because Respondent valued the larger, more desirable property at 952 Cleveland at $260,000, the subject property should be valued at $212,000 to reflect its smaller size and decreased marketability relative to 952 Cleveland.
- Respondent’s Evidence. Respondent introduced Exhibit 1, consisting of the BOE decision letter for the subject property. Exhibit 1 shows the BOE valued the subject property at $247,700.
- Value. The TVM of the subject property as of January 1, 2021, was $247,700.
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. Sections 137.115.1; 137.115.5(1)(a). The TVM is “the fair market value of the property on the valuation date[.]” 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). “True value in money is defined in terms of value in exchange not value in use.” Tibbs v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 7 (Mo. App. S.D. 2020) (internal quotation omitted). The TVM “is a function of [the property’s] highest and best use[.]” Snider, 156 S.W.3d at 346. “Determining the true value in money is an issue of fact for the STC.” Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008).
The TVM of a property is typically determined by the sales comparison approach, the income approach, or the cost approach. Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d at 346-48.
- 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). “Although technical rules of evidence are not controlling in administrative hearings, fundamental rules of evidence are applicable.” Mo. Church of Scientology v. State Tax Comm’n, 560 S.W.2d 837, 839 (Mo. banc 1977).
- Complainant’s Burden of Proof. The taxpayer bears the burden of proof and must show by a preponderance of the evidence the property is overvalued. Westwood P’ship v. Gogarty, 103 S.W.3d 152, 161 (Mo. App. E.D. 2003). The BOE’s valuation is presumptively correct. Tibbs, 599 S.W.3d at 7. The “taxpayer may rebut this presumption by presenting substantial and persuasive evidence that the valuation is erroneous.” Id. (internal quotation omitted). The taxpayer also 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 v. State Tax Comm’n, 722 S.W.2d 72, 77 (Mo. banc 1986) (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”).
Property owners are competent to testify to the reasonable fair market value of their property. Cohen, 251 S.W.3d at 348. However, if owner’s testimony is based on “improper elements or an improper foundation[,]” it is not substantial and persuasive evidence rebutting the presumptively correct BOE value. Id. at 349.
- Complainant Did Not Produce Substantial and Persuasive Evidence of Overvaluation.
Complainant did not produce substantial and persuasive evidence rebutting the presumptively correct BOE value. Complaint did not produce evidence supporting a comparable sales approach, income approach, or cost approach to value. The lack of evidence relating to a recognized valuation method renders Complainant’s proposed value speculative and unpersuasive. See Cohen, 251 S.W.3d at 349 (holding an opinion of value loses probative value when based on an improper foundation).
Complainant’s Exhibit A was an offer, not a sale. An offer may be relevant to value. But the rejection of an offer is also relevant. Complainant did not accept the $200,000 offer. Moreover, Exhibit A indicates the offeror – Prestige Custom Homes, Inc. – was a homebuilder, not an individual seeking a residence. An offer from a homebuilder or property rehabilitation firm may account for entrepreneurial profit and, therefore, may be less than an offer from a prospective resident.
Complainant’s Exhibit B shows Respondent’s assessment of an adjacent property. An assessment is not a sale. While Respondent is obligated to assess property according to its TVM, the STC determines the TVM by sales, not assessments. “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.” Snider, 156 S.W.3d at 347–48. Complainant did not produce evidence of arm’s-length sales or of the adjustments necessary to the subject property to 952 Cleveland or any other property. The STC “cannot base its decision on opinion evidence that fails to consider information that should have been considered under a particular valuation approach.” Id. at 348. Complainant’s Exhibit B is not substantial and persuasive evidence of the subject’s TVM.
Complainant did not produce substantial and persuasive evidence showing the BOE overvalued the subject property and “the value that should have been placed on the property.” Tibbs, 599 S.W.3d at 7.
CONCLUSION AND ORDER
Complainant did not produce substantial and persuasive evidence of overvaluation. The BOE decision is affirmed.
Application for Review
A party may file 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 of Missouri, 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.
The Collector of St. Louis County, and 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 the disputed taxes have been disbursed pursuant to a court order under the provisions of section 139.031.
SO ORDERED September 23, 2022.
Eric S. Peterson
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 September 23, 2022, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
Contact Information for State Tax Commission:
Missouri State Tax Commission
421 East Dunklin Street
P.O. Box 146
Jefferson City, MO 65102-0146
 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, sec. 14; Section 138.430.1, RSMo 2000. All statutory citations are to RSMo 2000, as amended.