Dorothy & Robert Shelton v. Jake Zimmerman, Assessor St. Louis County

July 31st, 2018

STATE TAX COMMISSION OF MISSOURI

 

DOROTHY J. SHELTON and ROBERT A. SHELTON, )  
  )  
Complainants, )  
  )  
v. ) Appeal No. 17-10147
  ) Parcel/Locator No. 26Y440105
JAKE ZIMMERMAN, ASSESSOR )  
ST. LOUIS COUNTY, MISSOURI, )  
  )  
Respondent. )  

 

DECISION AND ORDER

 

HOLDING

 

The assessment made by the Board of Equalization of St. Louis County (BOE) is SET ASIDE, in part, and AFFIRMED, in part.  Complainants Dorothy J. Shelton (Mrs. Shelton) and Robert A. Shelton (collectively referred to as Complainants) presented substantial and persuasive evidence to rebut the presumption of correct classification by the BOE but did not present substantial and persuasive evidence to rebut the presumption of correct valuation of the subject property as of January 1, 2017.

Complainants appeared by counsel Eric Tremayne.

Respondent Jake Zimmerman, Assessor, St. Louis County, Missouri, (Respondent) appeared by Counsel Steven Robson.

Case heard and decided by Senior Hearing Officer Amy S. Westermann (Hearing Officer).

ISSUE

Complainants appealed on the grounds of overvaluation and classification.  Respondent initially set the true value in money (TVM) of the subject property, as residential property, at $2,900.  The BOE lowered Respondent’s valuation and set the TVM at $600, as residential property.  The value as of January 1 of the odd numbered year remains the value as of January 1 of the following even numbered year unless there is new construction or improvement to the property.  Section 137.115.1 RSMo   The State Tax Commission (STC) takes this appeal to determine the true value in money for the subject property as the property existed on January 1, 2017, under the economic conditions as they existed on January 1, 2017.

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.  Complainants timely appealed to the State Tax Commission.
  2. Evidentiary Hearing. The issues of classification and overvaluation were presented at an evidentiary hearing on June 1, 2018, at the St. Louis County Government Administration Building, 41 South Central Avenue, Clayton, Missouri.
  3. Identification of Subject Property. The subject property is identified by parcel/locator number 26Y440105.  It is further identified as 19007 Sunflower Ridge Lane, Wildwood, Missouri.  (Complaint)
  4. Description of Subject Property. The subject property is vacant land consisting of .23 acre, which is connected to approximately 53.55 acres classified as agricultural and owned by Complainants.  The subject property is zoned non-urban, as is the contiguous 53.55 acres.  No structures for human habitation are present on the subject property and, pursuant to local ordinance, none can be erected because the subject property consists of less than 3 acres.   
  5. Assessment. Respondent initially valued the subject property at $2,900 residential, as of January 1, 2017.  The subject property was assessed at the statutory rate of 19%.
  6. Board of Equalization. The BOE lowered Respondent’s valuation to $600, as residential.  The subject property was assessed at the statutory rate of 19%.
  7. Complainants’ Evidence. Complainants opined that the subject property should be classified as agricultural with a productivity value of Grade 8 as of January 1, 2017.  To support their opinions of classification and value, Complainants offered the following evidence:
Exhibit Description Ruling
WDT of Complainants Written Direct Testimony of Complainants Admitted
Exhibit A St. Louis County Parcel Map with aerial view of the subject property in relation to surrounding parcels Admitted
Exhibit B Wildwood parcel map with aerial view of the subject property in relation to surrounding parcels and showing grassland and timber on either side of Sunflower Ridge Lane Admitted
Exhibit C St. Louis County Parcel Map with satellite view of subject property in relation to 53 acres also owned by Complainant Admitted

 

Respondent did not object to Complainant’s exhibits, all of which were admitted into the record.

Mrs. Shelton testified that Complainants have owned the subject property for 35 years.  Mrs. Shelton testified that an easement exists on the subject property to allow for access to Bouquet Road but that Complainants only use the easement to remove trees from the subject property.  Mrs. Shelton testified that Complainants maintain pasture grass on the contiguous 53.55 acres and that a farmer bales the grass to feed cattle.  Complainants do not maintain grass or pasture on the subject property.  Mrs. Shelton testified that Complainants have harvested trees on the subject property and have replanted small trees.  Mrs. Shelton testified that only timber can be grown on the subject property due to the rugged terrain, which is unusual, hilly, sloped, and covered with trees.  In conjunction with the presentation of Exhibit A, Mrs. Shelton testified that a ravine lies to the south of Sunflower Ridge Lane with a high elevation of 780 feet and a low elevation of 764 feet.

Mrs. Shelton testified that Sunflower Ridge Lane cuts through the center of the subject property.  Mrs. Shelton testified that Complainants and a neighbor use the segment of Sunflower Ridge Lane that passes through the subject property as part of a shared driveway.  Mrs. Shelton testified that local ordinances prohibit the erection of a residence on the subject property because the ordinances require a minimum of 3 acres and because the subject property is zoned “non-urban.”

Complainants testified that the agricultural productivity value that is most appropriate for the subject property is Soil Grade 8 because the subject property is a deep ravine where no planting other than timber is possible.  (Mrs. Shelton’s testimony; WDT of Complainants)

On cross examination, Mrs. Shelton testified that Complainants have never logged trees commercially on the subject property but have cut down some trees to use as firewood.  With regard to Exhibit A, Mrs. Shelton testified that the property line for the subject property extended only to the center of Sunflower Ridge Lane and not on the north side of the driveway.  Mrs. Shelton testified that Complainants do not have a forest management plan for the subject property but will be looking toward entering into one in the fall of 2018.

  1. Respondent’s Evidence. Respondent advocated that the subject property was properly classified as residential and that the TVM of the subject property as of January 1, 2017, was $600.  Respondent offered the following evidence:
Exhibit Description Ruling
Exhibit 1 BOE’s Findings and Notice of Decision Admitted

 

Complainants did not object to Respondent’s exhibit, which was received into the record.

  1. Presumption of Correct Classification Rebutted – Correct Classification Established; Presumption of Correct Valuation Not Rebutted. Complainant’s evidence was substantial and persuasive to rebut the presumption of correct classification but not to rebut the presumption of correct valuation as of January 1, 2017.

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, including the application of any abatement.  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.  Article X, Section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo. 

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 property and tangible personal property are assessed at set percentages of true value in money:  residential property at 19%; commercial property at 32%; and agricultural property at 12%.  Section 137.115.5 RSMo (2000) as amended.

Investigation by Hearing Officer

In order to investigate appeals filed with the Commission, the Hearing Officer may inquire of the owner of the property or of any other party to the appeal regarding any matter or issue relevant to the valuation, subclassification, or assessment of the property.  Section 138.430.2 RSMo (2000) as amended.  The Hearing Officer’s decision regarding the assessment or valuation of the property may be based solely upon his inquiry and any evidence presented by the parties or based solely upon evidence presented by the parties.  Id.

The Hearing Officer heard the testimony and reviewed the photographs provided as evidence on the issues of the classification and the productivity value for the subject property.

Complainant’s Burden of Proof

There exists a presumption of correct assessment by the BOE – the BOE presumption.  The BOE presumption operates in every case to require the taxpayer to present evidence to rebut it.  Conversely, if Respondent is seeking to prove a value or classification different than that set by the BOE, then Respondent is required to rebut the BOE presumption.

In the present appeal, the BOE sustained the initial classification of Respondent but lowered the valuation of Respondent.  The issues before the STC are (1) whether the BOE properly classified the subject property as residential; and (2) whether the BOE properly valued the subject property at $600.  Complainant is now seeking to change the classification and the valuation.  Respondent is seeking to affirm the BOE’s determination of classification and valuation.  Therefore, the BOE presumption applies to Complainant with regard to both issues, i.e., Complainant must rebut the presumption by substantial and persuasive evidence to prevail.

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 STC 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).

Classification of Real Property

The classification of real property is determined by the actual use put to the property.  Chesterfield Village, Inc., and Chesterfield Center Corporation v. Jake Zimmerman, Assessor, St. Louis County, Mo., STC Appeal Nos. 15-13823 through 15-13825 and 15-13826 (March 27, 2018); Northtown Village v. Don Davis, Assessor, Jasper County. Mo., STC Appeal No. 03-62558 (May 27, 2004).

According to Missouri law, “residential property” is all real property (1) improved by a structure which is used or intended to be used for residential living by human occupants; (2) vacant land in connection with an airport; (3) land used as a golf course; (4) manufactured home parks; (5) bed and breakfast inns in which the owner resides and uses as a primary residence with six or fewer rooms for rent; and (6) time-share units as as defined in Section 407.600 except to the extent such units are actually rented and subject to sales tax under Section 144.020.1(6); but residential property shall not include other similar facilities used primarily for transient housing.  Section 137.016.1(1).

“Agricultural and horticultural property” is all real property used for agricultural purposes and devoted primarily to the raising and harvesting of crops; to the feeding, breeding and management of livestock which shall include breeding, showing, and boarding of horses; to dairying, or to any other combination thereof; and buildings and structures customarily associated with farming, agricultural, and horticultural uses.  Section 137.016.1(2).  Agricultural and horticultural property shall also include land devoted to and qualifying for payments or other compensation under a soil conservation or agricultural assistance program under an agreement with an agency of the federal government.  Id.

Where real property is used or held for use for more than one purpose and such uses result in different classifications, the county assessor shall allocate to each classification the percentage of the true value in money of the property devoted to each use; except that, where agricultural and horticultural property, as defined in this section, also contains a dwelling unit or units, the farm dwelling, appurtenant residential-related structures and up to five acres immediately surrounding such farm dwelling shall be residential property, as defined in this section.  Section 137.016.4 (emphasis added).

All real property which is vacant, unused, or held for future use; which is used for a private club, a not-for-profit or other nonexempt lodge, club, business, trade, service organization, or similar entity; or for which a determination as to its classification cannot be made under the definitions set out in subsection 1 of this section, shall be classified according to its immediate most suitable economic use, which use shall be determined after consideration of:

(1)  Immediate prior use, if any, of such property;

(2)  Location of such property;

(3)  Zoning classification of such property; except that, such zoning classification shall not be considered conclusive if, upon consideration of all factors, it is determined that such zoning classification does not reflect the immediate most suitable economic use of the property;

(4)  Other legal restrictions on the use of such property;

(5)  Availability of water, electricity, gas, sewers, street lighting, and other public services for such property;

(6)  Size of such property;

(7)  Access of such property to public thoroughfares; and

(8)  Any other factors relevant to a determination of the immediate most suitable economic use of such property.

 

Section 137.016.5 (emphasis added).

Valuation of Agricultural Land

Land devoted primarily to the raising and harvesting of crops is valued by its productivity value.  The STC sets forth those valuations, based upon grades, in the Code of State Regulations (CSR).  As relevant to this decision, 12 CSR 30-4.010(1) provides, in pertinent part:

(F) Grade #6. Soils are generally unsuited for cultivation and are limited largely to pasture and sparse woodland. Limitations—

  1. Moderate to steep slopes (eight to twenty percent (8–20%));
  2. Severe erosion hazards present;
  3. Grades #3 and #4 bottomland subject to frequent damaging flooding (more than once in two (2) years), and Grade #5 bottomland subject to occasional damaging flooding (once every three to five (3–5) years); and
  4. Intensive management required for crops.

Use value: one hundred fifty-eight dollars ($147);

 

(G) Grade #7. These soils are generally unsuited for cultivation and may have other

severe limitations for grazing and forestry that cannot be corrected. Limitations—

  1. Very steep slopes (over fifteen percent (15%));
  2. Severe erosion potential;
  3. Grades #5 and #6 bottomland subject to frequent damaging flooding (more than

once in two (2) years);

  1. Intensive management required to achieve grass or timber productions; and
  2. Very shallow topsoil. Use value: seventy-three dollars ($73) . . . .

 

For purposes of valuation, forest land and horticultural land are treated differently from cultivated land.  12 CSR 30-4.010(2).  Forest land, whose cover is predominantly trees and other woody vegetation, should not be assigned to a land classification grade based on its productivity for agricultural crops.  12 CSR 30-4.010(2)(A) (emphasis added).  Forest land of two (2) or more acres in area, which if cleared and used for agricultural crops, would fall into land grades #1–#5 should be placed in land grade #6; or if land would fall into land grades #6 or #7 should be placed in land grade #7.  Id.  Forest land may or may not be in use for timber production, wildlife management, hunting, other outdoor recreation or similar uses.  Id.  Land utilized for the production of horticultural crops should be assigned to a land classification grade based on productivity of the land if used for agricultural crops.  12 CSR 30-4.010(2)(B)  Horticultural crops include fruits, ornamental trees and shrubs, flowers, vegetables, nuts, Christmas trees, and similar crops which are produced in orchards, nurseries, gardens, or cleared fields.  Id.

Claim of Overvaluation

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 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.

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).

Highest and Best Use

                True value in money is the fair market value of the property on the valuation date and is a function of its highest and best use, which is the use of the property which will produce the greatest return in the reasonably near future.  Aspenhof Corp. v. State Tax Commission, 789 S.W. 2d 867, 869 (Mo. App. 1990).  It is true that property can only be valued according to a use to which the property is readily available.  But this does not mean that in order for a specific use to be the highest and best use for calculating the property’s true value in money that particular use must be available to anyone deciding to purchase the property.  A determination of the true value in money cannot reject the property’s highest and best use and value the property at a lesser economic use of the property.  Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W. 3d 341, 348-349 (Mo. banc 2005).

Weight to be Given Evidence

The Hearing Officer is not bound by any single formula, rule, or method in determining true value in money and is free to consider all pertinent facts and estimates and give them such weight as reasonably they may be deemed entitled.  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).

The Hearing Officer, as the trier of fact, may consider the testimony of an expert witness and give it as much weight and credit as deemed necessary when viewed in connection with all other circumstances.  Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. W.D. 1991).  The Hearing Officer, as the trier of fact, is not bound by the opinions of experts but may believe all or none of the expert’s testimony or accept it in part or reject it in part.  Exchange Bank of Missouri v. Gerlt, 367 S.W.3d 132, 135-36 (Mo. App. W.D. 2012).

In this case, neither party presented expert testimony and evidence.

Official and Judicial Notice

Agencies shall take official notice of all matters of which the courts take judicial notice.  Section 536.070(6).  Courts will take judicial notice of their own records in the same cases.  State ex rel. Horton v. Bourke, 129 S.W.2d 866, 869 (1939); Barth v. Kansas City Elevated Railway Company, 44 S.W. 788, 781 (1898).  In addition, courts may take judicial notice of records in earlier cases when justice requires or when it is necessary for a full understanding of the instant appeal.  Burton v. Moulder, 245 S.W.2d 844, 846 (Mo. 1952); Knorp v. Thompson, 175 S.W.2d 889, 894 (1943); Bushman v. Barlow, 15 S.W.2d 329, 332 (Mo. banc 1929); State ex rel St. Louis Public Service Company v. Public Service Commission, 291 S.W.2d 95, 97 (Mo. banc 1956). 

In the present appeal, the Hearing Officer takes official notice of 12 CSR 30-4.010.

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, Inc., 564 S.W.2d at 897; 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. 1974).

“For purposes of levying property taxes, the value of real property is typically determined using one or more of three generally accepted approaches.”  Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341, 346 (Mo. banc 2005), citing St. Louis County v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977).  “Each valuation approach is applied with reference to a specific use of the property—its highest and best use.” Snider, 156 S.W.3d at 346-47, citing Aspenhof  Corp., 789 S.W.2d at 869.  “The method used depends on several variables inherent in the highest and best use of the property in question.”  Snider, 156 S.W.3d at 347.  “Each method uses its own unique factors to calculate the property’s true value in money.”  Id.  “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 348.  “Comparable sales consist of evidence of sales reasonably related in time and distance and involve land comparable in character.”  Id. (quotation omitted).  “This approach is most appropriate when there is an active market for the type of property at issue such that sufficient data [is] available to make a comparative analysis.”  Id.

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.

 

  1. Both parties are well informed and well advised, and both acting in what they consider their own best interests.

 

  1. A reasonable time is allowed for exposure in the open market.

 

  1. Payment is made in cash or its equivalent.

 

  1. Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.

 

  1. 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.

 

Real Estate Appraisal Terminology, Society of Real Estate Appraisers, Revised Edition, 1984; see also, Real Estate Valuation in Litigation, J. D. Eaton, M.A.I., American Institute of Real Estate Appraisers, 1982, pp. 4-5; Property Appraisal and Assessment Administration, International Association of Assessing Officers, 1990, pp. 79-80; Uniform Standards of Professional Appraisal Practice, Glossary.

Discussion

Complainants’ evidence was both substantial and persuasive to support an opinion that the classification of the subject property was agricultural as of January 1, 2017.  However, Complainants’ evidence was neither substantial nor persuasive to support an opinion that the true market value of the subject property was $97.75 as of January 1, 2017.  Substantial evidence is that which is relevant, adequate, and reasonably supports a conclusion.  Cupples Hesse Corp., 329 S.W.2d at 702.  Persuasive evidence is that which causes the trier of fact to believe, more likely than not, the conclusion advocated is the correct conclusion.  Id.

The undisputed evidence established that the .23-acre subject property was vacant land as of January 1, 2017.  No structure intended for human habitation was located on the subject property as of January 1, 2017.[1]   The classification of the subject property cannot be determined under the definitions of Section 137.115.1; therefore, the provisions of Section 137.016.5 must be considered:

(1)  Immediate prior use, if any, of such property;

(2)  Location of such property;

(3)  Zoning classification of such property; except that, such zoning classification shall not be considered conclusive if, upon consideration of all factors, it is determined that such zoning classification does not reflect the immediate most suitable economic use of the property;

(4)  Other legal restrictions on the use of such property;

(5)  Availability of water, electricity, gas, sewers, street lighting, and other public services for such property;

(6)  Size of such property;

(7)  Access of such property to public thoroughfares; and

(8)  Any other factors relevant to a determination of the immediate most suitable economic use of such property.

 

The immediate prior use of the subject property before January 1, 2017, was as a source of firewood and a point of access to Complainants’ contiguous 53.55 acres.  The location of the subject property is in an area of St. Louis County commonly known to include both residential and agricultural parcels.  The subject property is zoned non-urban, and local ordinance prohibits the erection of a house on the subject property because it is less than 3 acres in size.  A driveway runs through the center of the subject property, an access easement is present on the property, and the remainder is hilly and covered with trees, so the subject property was not suitable for a residence as of January 1, 2017, even if local ordinance allowed one to be built.  Given this substantial evidence, the Hearing Officer is persuaded that the subject property is forest land and should have been classified as agricultural as of January 1, 2017.

With regard to the claim of overvaluation, Complainants argued that the subject property should be valued based upon Soil Grade 8.  However, according to 12 CSR 30-4.010(2)(A), forest land, whose cover is predominantly trees and other woody vegetation, should not be assigned to a land classification grade based on its productivity for agricultural crops.  Complainants’ evidence established that the subject property is covered predominately by trees.  Thus, assigning a soil grade is not the proper method of valuing the subject property.  Complainants did not use any other method, specifically one of the three court-approved methods of valuation, to arrive at an opinion of TMV.  Consequently, the Hearing Officer would be required to engage in speculation to conclude that Complainants’ opinion of the TVM of the subject property is equal to the productivity value assigned to Soil Grade 8 is correct.

ORDER

The classification of the subject property as determined by the BOE is SET ASIDE.  The TVM for the subject property as determined by the BOE is AFFIRMED.  The assessed value for the subject property is $72 agricultural ($600 TVM), as of January 1, 2017.

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

Disputed Taxes

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 31, 2018.

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 sent electronically or mailed postage prepaid this 31st day of July, 2018, to: Complainants(s) counsel and/or Complainant, the County Assessor and/or Counsel for Respondent and County Collector.

 

Jacklyn Wood

Legal Coordinator

 

[1] It should be noted that the classification of real property could change from tax cycle to tax cycle, depending upon the specific circumstances shown by substantial and persuasive evidence in each case.  For example, as of January 1, 2017, local ordinance prohibited a residence from being erected on a parcel of less than three acres of land.  However, in the future, if local ordinance is amended to allow for the erection of residences on parcels of less than three acres of land, the classification of the subject property could change to residential, regardless of its immediate prior use as vacant land classified as agricultural.