STATE TAX COMMISSION OF MISSOURI
| ERIC KUHLMANN, | ) | |
| Complainant, | ) | Appeal No. 21-10206 |
| v. | ) | Parcel No. 21W630183 |
| JAKE ZIMMERMAN, ASSESSOR, | ) | |
| ST. LOUIS COUNTY, MISSOURI, | ) | |
| Respondent. | ) | |
| ) |
DECISION AND ORDER AMENDED NUNC PRO TUNC[1]
Eric Kuhlmann (Complainant) appeals the St. Louis County Board of Equalization’s (BOE) decision finding the true value in money (TVM) of the subject property on January 1, 2021, was $468,300. Complainant alleges overvaluation and asserted during the hearing that the TVM was $385,500.[2] Complainant did not produce substantial and persuasive evidence of overvaluation. The BOE decision is affirmed. The TVM of the subject property on January 1, 2021, was $468,300.
The evidentiary hearing was held on March 31, 2022, via Webex. Complainant appeared pro se. Respondent Jake Zimmerman, Assessor, St. Louis County, Missouri, was represented by counsel, Tim Bowe.
FINDINGS OF FACT
- The Subject Property. The subject residential real property is located at 17880 Westhampton Woods Dr., Wildwood, Missouri. The subject property consists of a 0.53 acre lot that includes a 2,456 square-foot single family ranch-style home, with three bedrooms and three bathrooms. The home was built in 2001. Complainant purchased the subject property in 2013 for $385,000.
- Assessment and Valuation. The BOE determined the TVM of the subject property as of January 1, 2021, was $468,300. The BOE decision indicates this value represents a reduction from Respondent’s appraised value of $512,400.
- Complainant’s Evidence. Complainant introduced Exhibit A and Exhibit B. Respondent did not object to either Exhibit. Exhibits A and B were admitted into evidence.
Exhibit A consists of printout information from Zillow.com and the St. Louis County Real Estate Information website concerning the property located at 1352 Westhampton Woods Ct., Wildwood, MO 63005, which Complainant believes is comparable to the subject property. Exhibit A shows that the property consists of a 0.46 acre lot with a ranch-style 2,410 square foot home that was built in 1996. Exhibit A states that the house has three bedrooms and two bathrooms, and that the property had an appraised value of $389,900 as of January 1, 2021. Exhibit A does not contain any sales data for the property.
Exhibit B consists of printout information from Zillow.com and the St. Louis County Real Estate Information website concerning the property located at 1408 Wellington View Ln., Chesterfield, MO 63005, which Complainant believes is comparable to the subject property. Exhibit B shows that the property consists of a 0.44 acre lot with a ranch-style 2,453 square foot home built in 1995. Exhibit B states that the house has four bedrooms and two bathrooms, and that the property had an appraised value of $389,500 as of January 1, 2021. Exhibit B does not contain any sales data for the property.
Complainant testified the subject property is similar to those contained in Exhibits A and B and stated that it should be appraised at a similar true value in money (TVM) as those properties.
- Respondent’s Evidence. Respondent introduced Exhibit 1, the BOE’s October 29, 2021 Decision Letter. Complainant did not object. Exhibit 1 was admitted into evidence.
- Value. The TVM of the subject property as of January 1, 2021, was $468,300.
CONCLUSIONS OF LAW
- Assessment and Valuation.
Pursuant to Article X, Sections 4(a) and 4(b), Mo. Const. of 1945 real property and tangible personal property is 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. Residential real property is assessed at 19% of its TVM as of January 1 of each odd-numbered year. Section 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). “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.
2. Evidence.
“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). 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). “It is within the purview of the hearing officer to determine the method of valuation to be adopted in a given case.” Tibbs v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 9 (Mo. App. S.D. 2020). 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. 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.
3. Complainant’s Burden of Proof.
The taxpayer bears the burden of proof and must show by a preponderance of the evidence that the property was 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”).
4. Complainant Did Not Produce Substantial and Persuasive Evidence of Overvaluation.
Complainant testified he believed that the subject property should be appraised at the same value as properties that he found to be similar, namely those contained in Exhibits A and B. However, Complainant offered no substantial and persuasive evidence that these homes had sold recently, or at what price they sold for. Additionally, Complainant did not make any market-based adjustments to the comparable properties in Exhibits A and B to account for any differences between them and the subject property. There was no evidence establishing that Complainant is an appraiser or has appraisal training and experience in order to make value comparisons between properties.
The comparable sales approach is typically used to value residential properties improved with a single-family home. “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 (internal quotation omitted).
While a property owner’s opinion of value is generally admissible, the opinion lacks “probative value where it is shown to have been based upon improper elements or an improper foundation.” Shelby Cty. R-IV Sch. Dist. v. Herman, 392 S.W.2d 609, 613 (Mo. 1965); see also Cohen v. Bushmeyer, 251 S.W.3d 345, 349 (Mo. App. W.D. 2008) (noting a property owner’s opinion of value loses probative value when it rests on an improper foundation). The comparable sales approach requires sales. Snider, 156 S.W.3d at 347-48. Complainant did not produce substantial and persuasive evidence showing that the subject property was overvalued based on comparable sales data. Therefore, Complainant’s evidence does not provide the necessary foundation and elements to support his overvaluation claim. Because the STC “cannot base its decision on opinion evidence that fails to consider information that should have been considered” under a recognized approach to value, Snider, 156 S.W.3d at 348, the BOE decision is affirmed.
CONCLUSION AND ORDER
The BOE decision is affirmed. The TVM of the subject property as of January 1, 2021, was $468,300, with an assessed value of $88,977.
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.
Disputed Taxes
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 June 3, 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 June 3, 2022, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
Amy S. Westermann
Chief Counsel
[1] This Decision and Order is amended nunc pro tunc to correct a scrivener’s error in the case caption identifying the appeal number. This Decision and Order and its date of issue remains otherwise unchanged.
[2] 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.