STATE TAX COMMISSION OF MISSOURI
|Complainant,||)||Appeal No. 21-18288|
|)||Parcel No. 25N310033|
|JAKE ZIMMERMAN, ASSESSOR,||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
DECISION AND ORDER
David Fry (Complainant) appeals the St. Louis County Board of Equalization’s (Respondent) decision valuing the subject residential property at $266,200 as of January 1, 2021. Complainant alleges overvaluation and asserts the true value in money (TVM) of the subject property as $140,000 as of January 1, 2021. The BOE decision is set aside. The TVM of the subject property as of January 1, 2021 is $190,000.
The evidentiary hearing was held on April 21, 2022, via Webex. Complainant appeared pro se. Respondent Jake Zimmerman, Assessor, St. Louis County, Missouri, was represented by counsel, Tim Bowe. The case was heard and decided by Senior Hearing Officer Benjamin C. Slawson.
FINDINGS OF FACT
- The Subject Property. The subject residential property consists of a 0.41 acre lot improved with a single-family two-story home located at 35 Balmagoun Ln. in St. Louis, Missouri. The house has a little over 2,000 square feet of living space and features a flat roof. The house was built on a concrete slab in 1950 and has three bedrooms and one bathroom. The original sewer lateral line is still functional, but Complainant stated that at some point it will need to be replaced. Complainant purchased the property in 2011 for $83,000. Complainant has not listed the property for sale in the last three years. Other than a few landscaping changes, Complainant has not made any improvements to the property in the last three years.
- Assessment and Valuation. Respondent determined the subject property’s appraised value was $266,200 as of January 1, 2021. The BOE determined the subject’s appraised value as of January 1, 2021, was $266,200.
- Complainant’s Evidence. Complainant introduced the following Exhibits, described below. All were admitted without objection.
|A||Appraisal of the subject property by Joel M. St. Pierre of In-Depth Appraisals, finding the TVM of the subject to be $190,000 as of January 1, 2021.|
|B||March 15, 2022 Quote by Reger Roofing and Siding Co. to remove and replace old roofing and flashing|
|C||Photographs of subject property interior and exterior, specifically showing water damage and patching in ceiling of utility room, and leaking rain collection on flat roof|
|D||April 4, 2022 quote and email by Maplewood Plumbing for $21,780 for plumbing repair to replace the 70 year old lateral line|
|E||Photographs of subject property interior, specifically of guest bedroom foundation and slab separation/sinking in the flooring|
|F||Photographs of subject property exterior, specifically the cedar siding in need of repair|
|G||Bid proposal by Lakeside Renovation & Design to redo the siding, fascia, and soffits around the house as well as install new fascia, soffit and gutters on the garage. The cost of siding replacement for the house is $47,345 and $9,765 for all the work on the detached garage.|
|H||Photographs of subject property interior, specifically of master bedroom foundation and slab separation/sinking in the flooring|
|I||Photographs of subject property interior, specifically of guest bedroom foundation and slab separation/sinking in the flooring|
|K||Photographs of subject property interior, specifically of bathroom showing cracking and settling of flooring|
|L||Photographs of subject property interior, specifically of mud room and kitchen showing settling of concrete slab and flooring|
|M||Complainant’s write up and summary of arguments on appeal|
|N||MARIS (Mid America Regional Info Systems) Listing for 2.948 lot for sale near Complainant’s property with a list price of $399,900.|
|O||Bird’s eye view of Complainant’s property and neighbors showing closeness to highway and resulting noise level from traffic described by Complainaint|
Complainant testified his opinion of value for the subject property is $140,000. Complainant said that Exhibit M contains a history of the subject property’s tax evaluation by Respondent as well as a summary of his arguments for overvaluation. Complainant stated that the property requires over $160,000 of repairs and offered bids and quotes from contractors as supporting evidence. Complainant also offered several pictures described above as evidence of all of the condition issues he believes devalue the property. Complainant asserted that, among other things, the house has settling issues which cause the flooring to buckle and the radiant heat not to work in several rooms. Additionally, in his opinion the siding, sewer lines, and several other features in the home need updating. Complainant also mentioned that because the house has a concrete slab and is located near a highway, blasting to rebuild a new structure is impossible. Complainant also offered Exhibit A, an appraisal by Joel M. St. Pierre. According to the Exhibit Mr. St. Pierre is a State Certified Residential Real Estate Appraiser in Missouri
On cross examination, Complainant admitted that he does not have professional training or experience in making repairs or remodels when determining the TVM of a subject property. Additionally Complainant stated that all of the condition issues he described existed when he bought the house in 2011.
- Respondent’s Evidence. Respondent introduced Exhibit 1, consisting of the October 29, 2021, BOE decision letter for the subject property. Exhibit 1 shows the BOE valued the subject property at $266,200. Respondent did not present any other evidence, but Counsel for Respondent stated on the record that Respondent agrees with the appraisal amount of $190,000 as of January 1, 2021 found by Mr. Joel St. Pierre in Complainant’s Exhibit A.
- Value. The TVM of the subject property as of January 1, 2021, was $190,000.
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.” 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).
“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. The STC has wide discretion in selecting the appropriate valuation method but “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.
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). “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 alsoWhite 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 produced evidence supporting a comparable sales approach to value and persuasively establishing that the BOE overvalued the property at $266,200. Exhibit A establishes that the TVM for the subject property is $190,000 as of the pertinent valuation date, January 1, 2021. While appraiser Mr. St. Pierre did not testify for Complainant, Respondent not only did not object to the admission of his appraisal report, but agreed with his conclusions and his finding of $190,000 for the TVM for the subject property as of January 1, 2021.
Examining Exhibit A in detail, Mr. St. Pierre uses the comparable sales approach to value and made market-based adjustments to determine the value of the subject. Mr. St. Pierre notes in his report “[t]he intended use of this appraisal is to assist the client to determine the value of the property for fair market value in its current as-is condition as of 01/01/2021.” Complainant testified that these conditions issues existed when he purchased the home in 2011. Therefore, the deferred maintenance and other problems with the house that Complainant testified to were considered by Mr. St. Pierre and factor into his valuation analysis. When analyzing the comparable sales and market conditions in the subject property’s area, Mr. St. Pierre notes several instances in his report where downward adjustments were necessary for differences between the subject property and others in the area.
While Complainant produced presented substantial and persuasive evidence to rebut the BOE and establish a new TVM of $190,000, Complainant’s testimony and other Exhibits are not substantial and persuasive evidence to establish a valuation of less than that amount. Complainant persuasively testified as to the many upgrades that would make his property more desirable and marketable, but these items were already considered in the appraisal Complainant offered as evidence. Therefore, Complainant did not successfully prove that his appraiser’s value figure of $190,000 should be adjusted lower.
CONCLUSION AND ORDER
The BOE decision is set aside. The TVM of the subject property as of January 1, 2021 is $190,000.
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 October 21, 2022.
Benjamin C. Slawson
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 October 21, 2022, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
 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.
 Complainant did not submit an Exhibit J. Exhibit P was pre-filed with the State Tax Commission by Complainant but not offered at the evidentiary hearing.
 Exhibit A, p. 3.