State Tax Commission of Missouri
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GAROLD & GARNET SCOBEE, |
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Complainant(s), |
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v. |
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Appeal(s) Number 13-80500 |
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CHRISSY GILLIS, ASSESSOR, |
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PUTNAM COUNTY, MISSOURI, |
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Respondent. |
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DECISION AND ORDER
HOLDING
Decision of the Putnam County Assessor is AFFIRMED.
Complainant, Garold Scobee, appeared pro se.
Respondent appeared pro se.
Case heard and decided by Senior Hearing Officer Luann Johnson.
ISSUE
The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2013, and January 1, 2014; the proper classification of said property; and whether or not discrimination existed in the valuation and classification of the property.
SUMMARY
Complainant appeals, on the ground of overvaluation, the Putnam County Assessor’s original valuation of the subject property of $306,630.Complainant proposed a value of $200,000.Complainant appeals on the ground of misclassification asserting that an excessive amount of square footage had been classified as residential when it should have been classified as agricultural.Lastly, the Complainant appeals on the ground of discrimination asserting that the county discriminated against him because the prior Assessor had expressed the thought that Complainant would not be able to repeat his successful 2011 appeal, which resulted in a lower value.A hearing was conducted on March 20, 2014, at the Putnam County Courthouse, Unionville, Missouri.
The Hearing Officer, having considered all of the competent evidence upon the whole record, determines that the valuation and classification of the property was appropriate; that Complainant failed to state a claim for discrimination; and enters the following Decision and Order.
Complainant’s Evidence
Complainant presented property tax receipts for tax years 2012 and 2013, a copy of an unexecuted real estate contract purporting to show that the property was purchased in 2010 for $165,000, and copies of county records showing the breakdown of classification and value for tax year 2013.
Respondent’s Evidence
Respondent presented the property record cards for tax year 2013.
FINDINGS OF FACT
1.Complainant appealed directly to the State Tax Commission after the receipt of his tax statement.Respondent testified that, generally, impact statements were mailed in a timely manner and there was no record of Complainant’s impact statement being returned to the County as undeliverable. Respondent could not verify that an impact statement was actually sent to Complainant.Respondent was not the Assessor at the time the impact statements were mailed.In the interest of due process, we take this appeal pursuant to 12 CSR 30-3.010.
2.The subject property is located at 21132 State Highway 5, Unionville, Putnam County, Missouri.The property is further identified as parcel number 180521001.01.The property is a 6.5 acre tract improved with a large truss style building built in approximately 2006.The building was owned by MoEnergy, Inc. The property had been on the market for some time, prior to auction, for an asking price of $300,000.Complainant purchased the property at auction in 2010 for $165,000.Thereafter, Complainant improved said building by converting a portion to residential use and adding a living room.Complainant contends that, after his improvements, the property has a market value of approximately $200,000.Complainant presented no appraisal report.
3.In addition to other space, the classification of which appears to be unquestioned, the building contains a 10,752 square foot “garage” area that Complainant asserts should be classified as wholly agricultural. Respondent contends should be classified as 5,952 square foot of residential property and 4,800 square foot of agricultural property.
Complainant asserts that he uses this garage area for the storage of his tractors.At hearing, he testified that on January 1, 2013, he had 7 tractors on the property.He further testified that 4 of his tractors were actually stored in the 588 square foot overhang while a 5th tractorand miscellaneous farm equipment was stored in the 480 square foot garage; leaving only 2 tractors for the 10,752 square foot garage.He testified that he used the remaining portion of the garage to house 3 recreational vehicles, 3 trucks – including his work truck – and miscellaneous personal belongs.Finally, Complainant testified that on January 1, 2013, the only agricultural land he owned was the 5.5 acres at the property location (1 acre being set aside for residential use).On this acreage he ran three cows.
5.There was no evidence of new construction and improvement from January 1, 2013, to January 1, 2014.
6.Complainant asserted that he was discriminated against because, after a prior successful appeal, the previous Assessor told him that he had “gotten away” with it once, but wouldn’t “get away” with it again.
7.Respondent presented property record cards showing a residential land value of $4,000 and an agricultural land value of $1,070.The property record cards further showed residential improvement value of $248,980 and agricultural improved value of $52,580.Respondent testified that the County utilized the Vanguard costing manual for replacement cost new and that appropriate depreciation was included when determining market value.
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.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.[1]
Official and Judicial Notice
Agencies shall take official notice of all matters of which the courts take judicial notice.[2]
Courts will take judicial notice of their own records in the same cases.[3]In addition, courts may take judicial notice of records in earlier cases when justice requires[4] or when it is necessary for a full understanding of the instant appeal.[5] Courts may take judicial notice of their own records in prior proceedings involving the same parties and basically the same facts.[6]
Presumptions In Appeals
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.[7]
The presumption in favor of the Board is not evidence.A presumption simply accepts something as true without any substantial proof to the contrary.In an evidentiary hearing before the Commission, the valuation determined by the Board, even if simply to sustain the value made by the Assessor, is accepted as true only until and so long as there is no substantial evidence to the contrary.
The presumption of correct assessment is rebutted when the taxpayer, or respondent when advocating a value different than that determined by the Board, 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.[8]
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.[9]It is the fair market value of the subject property on the valuation date.[10]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.[11]
Duty to Investigate
In order to investigate appeals filed with the Commission, the Hearing Officer has the duty to 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.The Hearing Officer’s decision regarding the assessment or valuation of the property may be based solely upon its inquiry and any evidence presented by the parties, or based solely upon evidence presented by the parties.[12]
Weight to be Given Evidence
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.[13]
Trier of Fact
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 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 who testify on the issue of reasonable value, but may believe all or none of the expert’s testimony and accept it in part or reject it in part.[14]
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.[15]
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.[16]
Opinion Testimony by Experts
An expert’s opinion must be founded upon substantial information, not mere conjecture or speculation, and there must be a rational basis for the opinion.[17]The state tax commission cannot ignore a lack of support in the evidence for adjustments made by the expert witnesses in the application of a particular valuation approach.[18]
The testimony of an expert is to be considered like any other testimony, is to be tried by the same test, and receives just so much weight and credit as the trier of fact may deem it entitled to when viewed in connection with all other circumstances.The hearing officer, as the trier of fact, has the authority to weigh the evidence and is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe all or none of the expert’s testimony and may accept it in part or reject it in part.[19]
If specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert on that subject, by knowledge, skill, experience, training, or education, may testify thereto.
The facts or data upon which an expert bases an opinion or inference may be those perceived by or made known to the expert at or before the hearing and must be of a type reasonably relied upon by experts in the field in forming opinions or inferences upon the subject and must be otherwise reliable, the facts or data need not be admissible in evidence.[20]
Respondent’s Burden of Proof
Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the Board of Equalization, 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.[21]
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, 2013.[22]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.”[23]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[24]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.[25]
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value.[26]The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.[27]“Where the basis for a test as to the reliability of the testimony is not supported by a statement of facts on which it is based, or the basis of fact does not appear to be sufficient, the testimony should be rejected.”[28]
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.”[29]
Classification
In Missouri, property is classified as residential, agricultural or commercial/all other.In order to qualify for an agricultural classification, property must actually be used for agricultural purposes.[30]
Discrimination
In order to obtain a reduction in assessed value based upon discrimination, the Complainants must (1) prove the true value in money of their property on January 1, 2013; and (2) show an intentional plan of discrimination by the assessing officials resulting in an assessment of that property at a greater percentage of value than other property, generally, within the same class within the same taxing jurisdiction.[31]Evidence of value and assessments of a few properties does not prove discrimination.Substantial evidence must show that all other property in the same class, generally, is actually undervalued.[32]The difference in the assessment ratio of the subject property the average assessment ratio in the subject county must be shown to be grossly excessive.[33]No other methodology is sufficient to establish discrimination.[34]
Complainant Failed to Present Substantial and Persuasive Evidence
Complainant presented only his opinion of value for the subject property.While that opinion has some weight, it does not establish value where it is based upon an auction price of a property in 2010.Market value of the property on January 1, 2013, may not necessarily be the same.Complainant failed to meet his burden of proof to establish that the property would have sold for no more than $200,000 on January 1, 2013.
Complainant failed to establish an agricultural use for his 10,752 square foot garage.From Complainant’s own testimony, most of the garage had no agricultural use at all.The only agricultural use Complainant could point to was the housing of a couple of tractors.Testimony as to the storage of two tractors does not provide substantial and persuasive evidence that the property was “devoted primarily to the raising and harvesting of crops”, and the presumption of correct assessment is not rebutted.
Finally, Complainant failed to establish any discrimination in the assessment of his property.A negative or adverse statement by the prior Assessor indicating a disagreement with a Board of Equalization decision does not establish that Complainant was treated differently than a statistically significant number of other mixed use properties in the county.
ORDER
The assessed valuation for the subject property as determined by the Assessor for Putnam County for tax years 2013 and 2014 is AFFIRMED.
A party may file with the Commission an application for review of this decision within thirty (30) days of the mailing date shown in the Certificate of Service.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, 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 appeal is based will result in summary denial. [35]
The Collector of Putnam 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 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 April 9, 2014.
STATE TAX COMMISSION OF MISSOURI
Luann Johnson
Senior Hearing Officer
[3] 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).
[4] 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)
[5] State ex rel St. Louis Public Service Company v. Public Service Commission, 291 S.W.2d 95, 97 (Mo. banc 1956).
[6] In re Murphy, 732 S.W.2d 895, 902 (Mo. banc 1987); State v. Gilmore, 681 S.W.2d 934, 940 (Mo. banc 1984); State v. Keeble, 399 S.W.2d 118, 122 (Mo. 1966).
[7] 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).
[8] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
[9] 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).
[11] 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.
[13] 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).
[14] 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).
[15] 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).
[16] 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).
[18] Drey v. State Tax Commission, 345 S.W. 2d 228, 234-236 (Mo. 1961), Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W. 3d, 341, 348 (Mo. 2005).
[19] Beardsley v. Beardsley, 819 S.W. 2d 400, 403 (Mo. App. 1991); Curnow v. Sloan, 625 S.W. 2d 605, 607 (Mo. 1981); Scanlon v. Kansas City, 28 S.W. 2d 84, 95 (Mo. 1930).
[20] Section 490.065, RSMo; State Board of Registration for the Healing Arts v. McDonagh, 123 S.W.3d 146 (Mo. SC. 2004); Courtroom Handbook on Missouri Evidence, Wm. A. Schroeder, Sections 702-505, pp. 325-350; Wulfing v. Kansas City Southern Industries, Inc., 842 S.W.2d 133 (Mo. App. E.D. 1992).
[23] 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).
[26] 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).
[27] 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).
[30] 137.016. 1. As used in section 4(b) of article X of the Missouri Constitution, the following terms mean:
(1) “Residential property”, all real property improved by a structure which is used or intended to be used for residential living by human occupants,
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(2) “Agricultural and horticultural property”, 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
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(3) “Utility, industrial, commercial, railroad and other real property”, all real property used directly or indirectly for any commercial, mining, industrial, manufacturing, trade, professional, business, or similar purpose, including all property centrally assessed by the state tax commission but shall not include floating docks, portions of which are separately owned and the remainder of which is designated for common ownership and in which no one person or business entity owns more than five individual units. All other real property not included in the property listed in subclasses (1) and (2) of section 4(b) of article X of the Missouri Constitution, as such property is defined in this section, shall be deemed to be included in the term “utility, industrial, commercial, railroad and other real property”.
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4. 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.