State Tax Commission of Missouri
ENRIC R. AMBROSI,)
v.) Appeal No.08-73000
ROBERT RAINES, ASSESSOR,)
MORGAN COUNTY, MISSOURI,)
AFFIRMING HEARING OFFICER DECISION
UPON APPLICATION FOR REVIEW
On November 21, 2008, Senior Hearing Officer W. B. Tichenor entered his Decision and Order (Decision) affirming the assessment by the Morgan County Board of Equalization.
Complainant timely filed his Application for Review of the Decision.
CONCLUSIONS OF LAW
Standard Upon Review
The Hearing Officer is not bound by any single formula, rule or method in determining true value in money, but 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.
The Hearing Officer as the trier of fact may consider the testimony of an expert or non-expert witness and give it as much weight and credit as he may deem it entitled to when viewed in connection with all other circumstances.The Hearing Officer is not bound by the opinions of experts or owners who testify on the issue of reasonable value, but may believe all or none of a witness’ testimony and accept it in part or reject it in part.
The Commission will not lightly interfere with the Hearing Officer’s Decision and substitute its judgment on the credibility of witnesses and weight to be given the evidence for that of the Hearing Officer as the trier of fact.
A review of the record in the present appeal provides support for the determinations made by the Hearing Officer.There is competent and substantial evidence to establish a sufficient foundation for the Decision of the Hearing Officer.A reasonable mind could have conscientiously reached the same result based on a review of the entire record. The Commission finds no basis to support a determination that the Hearing Officer acted in an arbitrary or capricious manner or abused his discretion as the trier of fact and concluder of law in this appeal.
Complainant’s letter that is the basis for his Application for Review essentially takes exception to the Hearing Officer not giving weight to a Real Estate Broker’s Estimate of Value.The remainder of Complainant’s Application for Review is more or less a rehashing of information and points raised as the evidentiary hearing.The Hearing Officer addressed the factors in the Broker’s estimate which rendered it unpersuasive.The Hearing Officer did not err in his determination that the broker’s estimate was an insufficient basis for the owner’s opinion of value.
The Commission upon review of the record and Decision in this appeal, finds no grounds upon which the Decision of the Hearing Officer should be reversed or modified.Accordingly, the Decision is affirmed.The Decision and Order of the hearing officer, including the findings of fact and conclusions of law therein, is incorporated by reference, as if set out in full, in this final decision of the Commission.
Judicial review of this Order may be had in the manner provided in Sections 138.432 and 536.100 to 536.140, RSMo within thirty days of the mailing date set forth in the Certificate of Service for this Order.
If judicial review of this decision is made, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the courts unless disbursed pursuant to Section 139.031.8, RSMo.
If no judicial review is made within thirty days, this decision and order is deemed final and the Collector of Morgan County, as well as the collectors of all affected political subdivisions therein, shall disburse the protested taxes presently in an escrow account in accord with the decision on the underlying assessment in this appeal.
SO ORDERED February 11, 2009.
STATE TAX COMMISSION OF MISSOURI
Bruce E. Davis, Chairman
Jennifer Tidwell, Commissioner
Charles Nordwald, Commissioner
DECISION AND ORDER
Decision of the Morgan County Board of Equalization reducing the assessment made by the Assessor is AFFIRMED.Hearing Officer finds Complainant did not rebut the presumption of correct assessment by the Board. True value in money for the subject property for tax year 2008 is set at $235,800, residential assessed value of $44,800.
Evidentiary hearing was held on at the Morgan County Courthouse, Versailles, Missouri.
Complainant appeared pro se.
Respondent appeared pro se.
Case heard and decided by Senior Hearing Officer W. B. Tichenor.
The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2007.
Complainant appeals, on the ground of overvaluation, the decision of the Morgan County Board of Equalization, which reduced the valuation of the subject property.The Assessor determined an appraised value of $240,000, assessed value of $45,600, as residential property.The Board reduced the value to $235,800, assessed value of $44,800.Complainant proposed a value of $150,000, assessed value of $28,500.
The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
Complainant testified in his own behalf.Mr. Ambrosi gave his opinion of the true value in money of the subject property as January 1, 2007, to be $150,000.The opinion of value was based upon a broker’s estimate of value (Exhibit B).The following exhibits were received into evidence:Exhibit A – photograph of subject; Exhibit B – Broker’s Estimate of Value; Exhibit C – Aerial photograph of subject; and Exhibit D – Three sales used by the Broker in arriving at his estimate of value.
Respondent testified as to the valuation of the subject property.The following exhibits were received into evidence: Exhibit 1 – photographs, property record card and aerial map of the subject property; Exhibit 2 – sales analysis and supporting documentation for the subject property; and Exhibit 3 – information on log homes.
FINDINGS OF FACT
1.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the decision of the Morgan County Board of Equalization.
2.The subject property is located at 31460 Red Arrow Road, Rocky Mount, Missouri.The property is identified by parcel number 21-50-16-5-3.The property consists of a 2.5 acre lot, with 550 feet of shore line on the Lake of the Ozarks.The lot is improved by a one-story log home of good quality construction, with a basement.The house was built in 2008 and appears to be in average condition.
3.The property is to be valued for tax year 2008, under the economic conditions as of January 1, 2007, as if the home constructed in 2008 had been in place on January 1, 2007.
4.Exhibits B and D upon which Complainant’s opinion of value was based were insufficient to establish that H. Fred Schien was qualified as an expert in appraisal of real property for purposes of presenting evidence before the Commission.
5.Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the true value in money as of January 1, 2007, to be $150,000, as proposed.
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 Appeals
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.The presumption of correct assessment is rebutted when the taxpayer presents substantial and persuasive evidence to establish that the Board’s valuation is erroneous and what the fair market value should have been placed on the property.A broker’s opinion letter does not constitute substantial and persuasive evidence when the valuation date of the opinion letter is May 14, 2008, when the sales data upon which the opinion is based does not constitute substantial and persuasive evidence to support the opinion of value.
Standard for Valuation
Section 137.115, RSMo, requires that property be assessed based upon its true value in money which is defined as the price a property would bring when offered for sale by one willing or desirous to sell and bought by one who is willing or desirous to purchase but who is not compelled to do so.It is the fair market value of the subject property on the valuation date.Market value is the most probable price in terms of money which a property should bring in competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeable and assuming the price is not affected by undue stimulus.
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.
2.Both parties are well informed and well advised, and both acting in what they consider their own best interests.
3.A reasonable time is allowed for exposure in the open market.
4.Payment is made in cash or its equivalent.
5.Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.
6.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.
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.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. The use of a broker’s opinion letter has not been recognized by the Commission as an appropriate method for valuation of real property in appeals before the Commission.No citation to a court case was presented to show that courts of this state have accepted such documentation for determining value.
Complainant’s Burden of Proof
In order to prevail, Complainant must present an opinion of market value and substantial and persuasive evidence that the proposed value is indicative of the market value of the subject property on January 1, 2007.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.”
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.
The evidence of value presented in this appeal, i.e. a real estate broker’s letter, does not constitute substantial and persuasive evidence to establish the fair market value of the subject property for the 2008 tax year.
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value.The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.The owner’s opinion of value rests entirely upon the conclusion of value rendered by a real estate broker.The broker’s opinion is not sufficient to rebut the presumption of correct assessment and establish the true value in money of the Complainants’ property.
The broker’s opinion is as of May 14, 2008, or approximately 18 months after valuation date (1/1/07).It is based upon sales occurring more than a year after the valuation date.Although sales data a year or two prior to valuation date and even a year or more after valuation date may sometimes be used by real estate appraisers, it is obvious in this instance, Mr. Schien did not understand he was valuing the property as of the wrong date.
The properties which undergird the broker’s opinion are of home built in 1988, 1980 and 1970.This is simply too great of a difference in age between these sales and the subject for these properties to be comparable to the subject.None of the sales have frontage on the Lake.None of the sales are shown to be log homes.All of these factors render the broker’s opinion of value as without any probative weight.Therefore, the owner’s opinion is not shown to have been founded upon proper elements and a proper foundation.An owner’s opinion without substantial and persuasive evidence to support it is of no benefit on the issue of fair market value.Complainant failed to met his burden of proof.
The assessed valuation for the subject property as determined by the Board of Equalization for Morgan County for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax year 2008 is set at $44,800.
Complainant may file with the Commission an application for review of this decision within thirty (30) days of the mailing of such decision.The application shall contain specific 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.
Failure to state specific facts or law upon which the appeal is based will result in summary denial. 
The Collector of Morgan County, as well as the collectors of all affected political subdivisions therein, shall continue to hold the disputed taxes pending a 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 November 21, 2008.
STATE TAX COMMISSION OFMISSOURI
W. B. Tichenor
Senior Hearing Officer
 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).
 St. Louis County v. Boatmen’s Trust Co., 857 S.W.2d 453, 457 (Mo. App. E.D. 1993); Vincent by Vincent v. Johnson, 833 S.W.2d 859, 865 (Mo. 1992);Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. 1991); Curnow v. Sloan, 625 S.W.2d 605, 607 (Mo. banc 1981).
 Black v. Lombardi, 970 S.W.2d 378 (Mo. App. E.D. 1998); Lowe v. Lombardi, 957 S.W.2d 808 (Mo. App. W.D. 1997); Forms World, Inc. v. Labor and Industrial Relations Com’n, 935 S.W.2d 680 (Mo. App. W.D. 1996); Evangelical Retirement Homes v. STC, 669 S.W.2d 548 (Mo. 1984); Pulitzer Pub. Co. v. Labor and Indus. Relations Commission, 596 S.W.2d 413 (Mo. 1980); St. Louis County v. STC, 562 S.W.2d 334 (Mo. 1978); St. Louis County v. STC, 406 S.W.2d 644 (Mo. 1966).
 Hermel, Inc. v. STC, 564 S.W.2d 888 (Mo. 1978); Black v. Lombardi, 970 S.W.2d 378 (Mo. App. E.D. 1998); Holt v. Clarke, 965 S.W.2d 241 (Mo. App. W.D. 1998); Smith v. Morton, 890 S.W.2d 403 (Mo. App. E.D. 1995); Phelps v. Metropolitan St. Louis Sewer Dist., 598 S.W.2d 163 (Mo. App. E.D. 1980).
 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).
 St. Joe Minerals Corp. v. State Tax Commission, 854 S.W.2d 526, 529 (Mo. App. E.D. 1993); Missouri Baptist Children’s Home v. State Tax Commission, 867 S.W.2d 510, 512 (Mo. banc 1993).
 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.
 See, Nance v. STC, 18 S.W.3d 611, at 615 (Mo. App. W.D. 2000); Hermel, supra;Xerox Corp. v. STC, 529 S.W.2d 413 (Mo. banc 1975).
 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).
 See, 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).Industrial Development Authority of Kansas City v. State Tax Commission of Missouri, 804 S.W.2d 387, 392 (Mo. App. 1991).
 Rigali v. Kensington Place Homeowners’ Ass’n, 103 S.W.3d 839, 846 (Mo. App. E.D. 2003); Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970).
 Cohen v. Bushmeyer, 251 S.W.3d 345, (Mo. App. E.D., March 25, 2008); Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992); State, ex rel. Missouri Hwy & Transp. Com’n v. Pracht, 801 S.W.2d 90, 94 (Mo. App. E.D. 1990); Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965).