State Tax Commission of Missouri
DIERBERG WILDWOOD, )
v. ) Appeal No.11-11325
JAKE ZIMMERMAN,ASSESSOR, )
ST. LOUIS COUNTY, MISSOURI, )
DECISION AND ORDER
Decision of the St. Louis County Board of Equalization sustaining the assessment made by the Assessor is AFFIRMED.Complainant failed to present substantial and persuasive evidence to rebut the presumption of correct assessment by the Board of Equalization.
True value in money for the subject property for tax years 2012 is set at $770,000, commercial assessed value of $246,400.
Complainant represented by Counsel, Robert Greenberg, Ballwin, Missouri.
Respondent represented by Associate County Counsel, Edward Corrigan.
Case decided by Senior Hearing Officer W. B. Tichenor.
Complainant appeals, on the ground of misclassification, the decision of the St. Louis County Board of Equalization, which sustained the valuation and classification of the Complainant’s property.The Commission takes this appeal to determine the classification for the subject property on January 1, 2011. 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.Complainant appeals on the ground of Misclassification, asserting that the proper classification of the property should be agricultural.
2. Dismissal of Appeal & Reinstatement. By Order dated 6/18/12, Complainant was to file Certification to Prosecute on or before January 31, 2013.Complainant failed to so certify and Order Dismissing Appeal was issued March 6, 2013.Complainant was given until March 19, 2013, to file a Motion to Set Aside Dismissal and Reinstate the appeal.On March 11, 2013, Complainant filed its Motion to Set Aside and Reinstate.By Order dated 3/15/13, the Order Dismissing Appeal was vacated and the appeal was reinstated.
3. Exchange Schedule and Procedure. The Order dated 3/15/13 established an Exchange Schedule and Procedure.The Schedule and Procedure required that each party file and exchange exhibits and written direct testimony to establish their case in chief on or before 5/13/12.Complainant file and exchange the exhibits set out below under Complainant’s Evidence.Respondent did not file and exchange any exhibits or written direct testimony.
4. Identification of Subject Property. The Complaint for Review of Assessment identifies the subject property as being located at 16795 Manchester, Wildwood, Missouri.The Complaint gives the locator number for the property to be 24V630312.
5. Description of Subject Property. No description of the property was provided in Complainant’s exhibits.
7. Complainant’s Evidence. Complainant filed with the Commission the following documents:Exhibit A – Invoice from Kelpe Contracting for grading seed and straw for $26,482.20; Exhibit B – Invoice from Kelpe Contracting for Brome and Orchard Grass for hay production $7,544, and Exhibit C – Invoice from John T. Strecker Grading and Seeding LLC for $610.00.Complainant failed to comply with the Commission Order and file any written direct testimony to lay a foundation as the relevance of Exhibits A, B and C and how they establish a prima facie case of misclassification as commercial property for the property under appeal.
8. No Evidence of New Construction & Improvement. There was no evidence of new construction and improvement from January 1, 2011, to January 1, 2012; therefore the assessed value for 2011 remains the assessed value for 2012.
9. Presumption of Correct Assessment Not Rebutted. Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish that the primary use of the subject property as of 1/1/11 and 1/1/12 met the statutory definition of agricultural property. See, Presumption In Appeal, Agricultural Classification of Land, and Complainant Fails to Establish Agricultural Classification, infra.
10. Respondent’s Evidence. Respondent was under no burden of proof in the appeal and could rest upon the presumption of correct assessment by the Board.Respondent did so rest upon the presumption and declined to file and exchange exhibits or written direct testimony.
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.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.
Presumption In Appeal
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.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.In a misclassification appeal, the presumption of correct assessment is rebutted when the taxpayer presents substantial and persuasive evidence to establish that the Board’s assessment is erroneous and what the correct classification should have been placed on the property.
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.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.
Agricultural Classification of Land
Section 137.016.1(2), RSMo, provides the controlling definition for the classification of land as agricultural or horticultural property.That definition reads in relevant part;
“all real property used for agricultural purposes and devoted primarily to the raising and harvesting of crops; . . . . “
Section 137.017, RSMo, provides the following provisions relevant to the present appeal:
1. For general property assessment purposes, the true value in money of land which is in use as agricultural and horticultural property, as defined in section 137.016, shall be that value which such land has for agricultural or horticultural use.
4. For general property assessment purposes, the true value in money of vacant and unused land which is classified as agricultural and horticultural property under subsection 3 of section 137.016 shall be its fair market value.”
By Commission Rule, there are established eight Agricultural Land Productive Values for the assessment of agricultural and horticultural land. The grades and corresponding per acre values set by the Rule are:Grade # 1 – $985; Grade # 2 – $810; Grade # 3 – $615; Grade # 4 – $385; Grade # 5 – $195; Grade # 6 – $150; Grade # 7 – $75 and Grade # 8 – $30.Complainant did not present any evidence to establish in what productive grade the subject property should be placed based upon the specific factors detailed in the Rule.
Section 137.016.5 provides the statutory procedure for determining classification of property that is vacant, unused or held for future use, for which a determination as to its classification cannot be made under the statutory definitions.The eight factors are: immediate prior use, location, zoning, legal restrictions, availability of utilities size, access to public thoroughfares and other relevant factors.Complainant did not present any evidence to establish any of these factors so that an analysis could be performed to ascertain if the property was in fact on the assessment date a property that was vacant, unused or held for future use.
Written Direct Testimony
The Order dated 3/15/13 setting the Exchange Procedure in this appeal contained the following language under the procedure on Written Direct Testimony:
“Each party shall file with the Commission the original of written direct testimony of each witness expected to be called for the party’s case in chief, and serve a copy upon opposing counsel.Written direct testimony shall be in a question and answer form with each question numbered sequentially, typed on 8 ½ by 11 inch paper.Written direct testimony must be as complete and accurate as if it were oral testimony.
This language follows directly from the Commission Rule on the exchange procedure.
Complainant elected to not comply with the plain language of the Commission Order and file written direct testimony.
Complainant Fails to Establish Agricultural Classification
In order to prevail, Complainant must present substantial and persuasive evidence that the subject property’s use as of January 1, 2011, met the statutory definition of agricultural property. The taxpayer is the moving party seeking affirmative relief.The taxpayer therefore, bears this burden of proof.
The taxpayer elected to present the three documents as exhibits noted in FINDING OF FACT 7.As just addressed there is no testimony in the record which establishes the foundation for Complainant’s exhibits.Respondent failed to make any objections to Exhibits A, B and C, accordingly they come into the record and the case is decided upon these three documents absent the benefit of testimony to lay a foundation to establish relevance or give explanation as to what the documents are intended to establish concerning the use of the subject property during 2011 and 2012.
Exhibit A consists of an invoice billed to Greenberg Development, 15563 Manchester Road, Ballwin, MO 63011.The “job name” for this invoice is “Lot # 3.The invoice is dated 8/29/2010.It is for “Grading and Seed/Straw.It provides a description for two different charges.One is “Ea. Remaining amount to bill” in an amount of $18,488.20 and the other is “Ea. Brome and Orchard grass for hay production” in the amount of $8,004.
Exhibit B is billed to the same name and address as Exhibit A.The “job name” for this invoice, however, is “Lot 4A.”Exhibit B is also dated 8/29/10 and it is for “Ea. Brome and Orchard grass for hay production” in the amount of $7,544.
Exhibit C is a bill dated 6/11/12 made out to Greenberg Development, 15563 Manchester Rd, St. Louis, MO 63011.The bill is apparently for work at “Wildwood – – – – (unintelligible word) Centre.The work invoiced is:Brush hog area behind cinema – 7 hrs tractor – 525.00 and labor to weed-eat – 85.00; Total 610.00.
Counsel for Complainant in his letter of 11/30/12 to Respondent’s Counsel advises it is these three documents that constitute “. . . proof of the property being agricultural in nature”.The Hearing Officer is not so persuaded.Complainant rest its case upon three documents to establish that curing the years 2011 and 2012 the subject property was “used for agricultural purposes and devoted primarily to the raising and harvesting of crops”.
The most that the Hearing Officer can logically draw from the three documents is that: (1) Greenberg Development was billed for grading and apparently seeding of brome and orchard grass on two tracts of unidentified land intended to be used for hay production in August 2010; and (2) an area behind a cinema was mowed with a brush hog and subject to weed-eating in June 2012.There is nothing in any of the documents from which the Hearing Officer can logically or reasonably conclude that either one or both of the tracts of land on which brome and orchard grass was sown was in fact the subject tract of land.Likewise the documents do not establish that the use of a brush hog and a weed eater were for the property that is the subject of this appeal.Mowing of pasture land with a brush hog does not constitute hay production.In order for hay to be produced, the cut grass must be raked and allowed to dry or cure so that it may be baled.There is no evidence such was done with regard to the subject property. The documents fail to establish any hay production or other agricultural activity on the subject land during 2011 and 2012.
A taxpayer does not meet its burden if evidence on any essential element of the case leaves the Hearing Officer “in the nebulous twilight of speculation, conjecture and surmise.” This is exactly the location the Hearing Officer has been placed in this instance.The essential elements of Complainant’s case were: (1) to establish the property under appeal was used for agricultural purposes and devoted primarily to the raising and harvesting of crops during 2011 and 2012; and (2) to establish the appropriate agricultural land productive value so as to ascertain the value to be assigned, if the property was actually being used for an agricultural purpose.
Assuming, without finding (since there is no evidence upon which it can be found), that Lot # 3 and Lot # 4A identified on Exhibits A and B constitute the subject property, the evidence only would establish an apparent intention to commence an agricultural operation of hay production of the property.Intention to make use of a property for an agricultural purpose is not sufficient to obtain an agricultural classification.Furthermore, there is no evidence to establish that during 2011 and 2012 the property was devoted primarily to the raising and harvesting of brome orchard grass hay.No evidence as to the critical factors provided in detail by the Commission rule on land productive values was presented which would permit the Hearing Officer to ascertain exactly which land grade should have been applied to the subject, if Complainant had in fact established a primary use of raising hay.
Assuming further, again without finding, that it was simply Complainant’s intention to have the twelve percent agricultural assessment applied to the appraised value of $770,000, as determined by the Assessor and sustained by the Board, the record provides no evidence whatsoever upon which the Hearing Officer can conclude that the most “immediate most suitable economic use” of the property would be agricultural under 137.016.5.Exhibits A, B & C fail to supply any relevant information as to any of the eight factors upon which it might be concluded that the subject is land should be considered as being vacant and unused and given an agricultural classification under 137.017.4.
In order for the Hearing Officer to conclude that during 2011 and 2012 the subject property should be classified as an agricultural property, he would have to do so based upon nothing but “speculation, conjecture and surmise”, these elements do not constitute substantial and persuasive evidence to establish the case claimed by Complainant.Complainant filed to present evidence to establish its prima facie case and the classification made by the Assessor and sustained by the Board must be affirmed.
Issuance of Decision Absent Evidentiary Hearing
The Hearing Officer, after affording the parties reasonable opportunity for fair hearing, shall issue a decision and order affirming, modifying or reversing the determination of the board of equalization, correcting any assessment which is unlawful, unfair, improper, arbitrary or capricious. The filing of exhibits and written direct testimony establishes the basis upon which opportunity for an evidentiary hearing can be held.The present case with only Complainant’s three exhibits and no written direct testimony provided no basis upon which an evidentiary hearing could or should be conducted.
Since Complainant had voluntarily waived presenting any written direct testimony, an evidentiary hearing would serve no purpose, since there was no witness or witnesses who Respondent could cross-examine, as this would be the only purpose to hold an evidentiary hearing.Accordingly, the responsibility of the Hearing Officer, as has been addressed above, was to simply consider the exhibits that were filed and then proceed to ascertain if said exhibits, standing on their own without the benefit of any testimony to explain, or support them, met the standard of substantial and persuasive evidence to warrant a reclassification of the subject property.
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for St. Louis County for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax years 2011 and 2012 is set at $246,400.
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.
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 September 4, 2013.
STATE TAX COMMISSION OFMISSOURI
W. B. Tichenor
Senior Hearing Officer
 BOE Decision, dated 79/23/11 – Attached to Complaint for Review of Assessment.
 Complainant failed to label the exhibits for purposes of identification as had been ordered, therefore, the Hearing Officer has marked the exhibits for purpose of identification, as Exhibits A, B & C.
 Section 137.115.1, RSMo.
 Article X, Section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo.
 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)
 Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959)
 See, Cupples-Hesse, supra.
Substantial and persuasive evidence is not an extremely high standard of evidentiary proof.It is the lowest of the three standards for evidence (substantial & persuasive, clear and convincing, and beyond a reasonable doubt).It requires a small amount of evidence to cross the threshold to rebut the presumption of correct assessment by the Board.The definitions, relevant to substantial evidence, do not support a position that substantial and persuasive evidence is an extremely or very high standard.
“Substantial evidence: Evidence that a reasonable mind would accept as adequate to support a conclusion; evidence beyond a scintilla.”Black’s Law Dictionary, Seventh Edition, p. 580.
The word scintilla is defined as “1. a spark, 2. a particle; the least trace.” Webster’s New World Dictionary, Second College Edition.Black’s definition at 1347 is “A spark or trace <the standard is that there must be more than a scintilla of evidence>.”There must be more than a spark or trace for evidence to have attained the standard of substantial.Once there is something more than a spark or trace the evidence has reached the level of substantial.Substantial evidence and the term preponderance of the evidence are essentially the same. “Preponderance of the evidence.The greater weight of the evidence; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”Black’s at 1201.Substantial evidence is that a reasonable mind would accept as adequate to support the conclusion.Preponderance is sufficient to incline a fair and impartial mind to one side of the issue rather than the other, i.e. support the proposed conclusion.
 Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975).
 12 CSR 30-4.010 – Agricultural Land Productive Values
 Submitted to the Commission on 3/14/13.
 The Hearing Officer is well aware that both brome and orchard grasses are utilized for both hay production and pasture in Missouri, or they may also be used as simply ground cover for land that is not being used either as an active pasture for the grazing of livestock or for actual hay production from year to year.
 The Hearing Officer has personal experience operating both a brush hog and a weed eater.Neither are pieces of equipment utilized in a farming operation for the harvesting of hay.
 The Hearing Officer has personal knowledge, from having come from an agricultural background, to know about the production of hay and continues to be aware of same, being involved in a small agricultural enterprise which requires the purchase of hay from year to year.
 See, Rossman v. G.G.C. Corp. of Missouri, 596 S.W.2d 469, 471 (Mo. App. 1980).
 Section 138.431.5 RSMo; 12 CSR 30-3.080 (2)
 Section 138.432, RSMo.