STATE TAX COMMISSION OF MISSOURI
|FRANK & EVA IMO,||)||Appeal No. 19-72501|
|JEROME OVERKAMP, ASSESSOR,||)|
|MONTGOMERY COUNTY, MISSOURI,||)|
DECISION AND ORDER
The assessment made by the Board of Equalization of Montgomery County (BOE) is SET ASIDE. Complainants Frank and Eva Imo (Complainants) presented substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE and to establish the true value in money (TVM) of the subject property as of January 1, 2019. Respondent Jerome Overkamp, Assessor, Montgomery County, Missouri, (Respondent) offered no evidence into the record other than his own very short testimony.
Complainants appeared by counsel Patrick Keefe.
Respondent appeared pro se.
Case heard and decided by Senior Hearing Officer John Treu (Hearing Officer).
Complainants appealed on the ground of overvaluation. Respondent initially set the assessed value of the subject property, as commercial property, at $265,570 ($829,900). The BOE set the assessed value at $241,500 ($754,690 TVM), thereby lowering Respondent’s valuation. 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. The State Tax Commission (STC) takes this appeal to determine the TVM for the subject property as the property existed on January 1, 2019, under the economic conditions as they existed on January 1, 2019.
The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
FINDINGS OF FACT
- Authority. Authority over this appeal is proper. Complainants timely appealed to the STC.
- Evidentiary Hearing. The issue of overvaluation was presented at an evidentiary hearing on June 8, 2020, conducted telephonically by agreement of all parties. A face-to-face evidentiary hearing was waived by the parties.
- Identification of Subject Property. The subject property is identified by parcel/locator number 50-10-9.0-32-000-000-003.001. It is further identified as 22 Coal Chute Road, High Hill, Montgomery County, Missouri. (Exhibits 1 and 2)
- Description of Subject Property. The subject property consists of a 4.82 acre site, of which approximately half is not useable due to topography and a small creek. It is improved with a 13,020 square foot office/warehouse building. The building has 1,040 square feet of office space. It has 18 foot ceilings, two drive-in doors, and no docks. The building was constructed in 2007. It is in below average condition for its age due to the prior use as a bio-diesel production facility. The site has a small gravel parking lot, a large open concrete pad, and a 2,010 square foot covered concrete pad. (Exhibit A)
- Assessment. Respondent initially valued the subject property at $829,900 commercial, as of January 1, 2019.
- Board of Equalization. The BOE valued the subject property at $754,690.
- Complainant’s Evidence. Complainant opined that the subject property’s TVM as of January 1, 2019, was $310,000. To support his opinion of value, Complainants offered the following evidence:
|Exhibit A||Property Appraisal Report of Joe Camerer (Camerer)||Admitted|
|Exhibit B||Written Direct Testimony of Camerer||Admitted|
Camerer is a Missouri State Certified General Appraiser. He is the Senior Commercial Appraiser and President of Commercial Appraiser Network. Exhibit A was prepared in conformity with the requirements of the Uniform Standards of Professional Appraisal Practice (USPAP). The effective date of the appraisal is January 1, 2019.
The appraisal utilized the sales comparison approach to value. The income approach was not developed due to lack of similar comparable property rentals in the areas. The cost approach was not developed due to the high level of accrued depreciation in the improvements.
The sales comparison approach utilized five comparable sales, which sold between July 23, 2015, and March 28, 2019. The sales price per square foot of the five sales ranged from $16.05 to $33.33 per square foot. Camerer made adjustments for conditions of sale, location, size, construction/use, office percentage, ceiling height, dock/drive-in, other, and land/bldg. ration/parking. The adjusted sales price of the five sales comparables ranged from $21.03 to $25.38. Camerer opined a TVM for the subject property of $310,000, as of January 1, 2019.
- Respondent’s Evidence. Respondent offered no exhibits for admittance into the record. Respondent testified that he thought Complainants’ method was good and that their appraisal was good.
- Presumption of Correct Assessment Rebutted – Value Established. Complainants’ evidence was substantial and persuasive to rebut the presumption of correct assessment by the BOE and establish that the TVM of the subject property was $310,000 as of January 1, 2019. Respondent presented no evidence.
CONCLUSIONS OF LAW AND DECISION
The STC has authority 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.
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.
Investigation by Hearing Officer
In order to investigate appeals filed with the STC, 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 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.
Complainant’s Burden of Proof
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, 901-803 (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. “Substantial and persuasive controverting evidence is required to rebut the presumption, with the burden of proof resting on the taxpayer.” Cohen, 251 S.W.3d at 348. 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).
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.” 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).
Respondent’s Burden of Proof
Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the BOE, must meet the same burden of proof to present substantial and persuasive evidence of the value advocated as required of the Complainant under the principles established by case law. Hermel, Inc., 564 S.W.2d at 895; Cupples-Hesse, 329 S.W.2d at 702; Brooks, 527 S.W.2d at 53.
In this case, Respondent presented no evidence.
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 Co. v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977); St. Louis Co. v. STC, 515 S.W.2d 446, 450 (Mo. 1974); Chicago, Burlington & Quincy RR. Co. 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).
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). “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:
- Buyer and seller are typically motivated.
- Both parties are well informed and well advised, and both acting in what they consider their own best interests.
- A reasonable time is allowed for exposure in the open market.
- Payment is made in cash or its equivalent.
- Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.
- 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.
Complainants’ evidence was both substantial and persuasive to support an opinion as to the TVM of the subject property as of January 1, 2019. Camerer used the comparable sales approach for determining an opinion of TVM for the subject property. Camerer’s report made adjustments to account for the similarities and differences between the five comparable properties and the subject property. Respondent stated that the methods and appraisal of Complainants were good. Camerer opined a TVM for the subject property of $310,000.
The TVM for the subject property as determined by the BOE is SET ASIDE. The assessed value for the subject property is $99,200 commercial ($310,000 TVM), as of January 1, 2019.
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.
The Collector of Montgomery 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.
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, 2020
STATE TAX COMMISSION OF MISSOURI
John J. Treu
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, 2020, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
firstname.lastname@example.org; email@example.com; firstname.lastname@example.org
Elaina McKee, Legal Coordinator
 All statutory references are to RSMo 2000, as amended, unless otherwise indicated.
 When Respondent was asked if he had any evidence he responded that he did not. Respondent mailed documents marked “No. 1” though “#15” to the State Tax Commission, received on June 9, 2019, one day after the evidentiary hearing was conducted telephonically. Such include the property record card, a sketch of the subject property, Complaint for Review of Assessment, Board of Equalization (BOE) documents, emails (one with handwriting), BOE appeal form, and documents from Complainant’s appraisal (Exhibit A). The documents were not mentioned by Respondent, offered by Respondent, or admitted into the evidentiary record by the Hearing Officer.