State Tax Commission of Missouri
GARY RICHARD NIEMETZ,)
)
Complainant,)
)
v.) Appeal Number 09-10128
)
MICHAEL BROOKS,)
ACTING ASSESSOR,)
ST. LOUIS COUNTY,MISSOURI,)
)
Respondent.)
DECISION AND ORDER
HOLDING
Decision of the St. Louis County Board of Equalization reducing the assessment made by the Assessor is AFFIRMED.True value in money for the subject property for tax years 2009 and 2010 is set at $105,000, residential assessed value of $19,950.Complainant appeared pro se.Respondent appeared by Associate County Counselor Paula J. Lemerman.
Case heard and decided by Senior Hearing Officer W. B. Tichenor.
ISSUE
Complainant appeals, on the ground of overvaluation, the decision of the St. Louis County Board of Equalization, which sustained the valuation of the subject property.The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2009.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.Complainant timely appealed to the State Tax Commission from the decision of the St. Louis County Board of Equalization.A hearing was conducted on June 22, 2010, at the St. LouisCountyGovernmentCenter,Clayton,Missouri.
2.Assessment.The Assessor appraised the property at $113,900, assessed residential value of $21,640.The Board of Equalization reduced the value to $105,000, assessed residential value of $19,950.[1]
3.Subject Property.The subject property is located at 8520 Vasel Ave., St. Louis County, Missouri.The property is identified by locator number 25J331322.The property consists of 7,500 square foot lot improved by a one-story frame bungalow, single-family structure of average quality construction.The house was built in 1940 and appears to be in average physical condition for its age.The residence has four rooms, with two bedrooms, a single bath, and contains 912 square feet of living area.There is a full unfinished basement.
4.Complainant’s Evidence.Complainant testified in his own behalf.He gave his opinion of the fair market value of the property as of January 1, 2009,to be $85,000, based upon the age of the house and that it did not have updates or had not been rehabbed.In support of his opinion of value Mr. Niemetz offered into evidence the following exhibits.
|
EXHIBIT |
DESCRIPTION |
DISPOSITION |
|
A |
Tax Protest Letter |
Obj – Not Received |
|
B |
Dalco Home Remodeling letter – 3/23/10 |
Obj – Not Received |
|
C |
Tax History |
Obj – Not Received |
|
D |
Change Notice/BOE Letter |
Received |
|
E |
Photos of Subject |
Received |
|
F |
Photos of 8508 Vasel Ave |
Received |
Counsel for Respondent objected to Exhibits A, B & C on the grounds of relevance and hearsay.The objections were sustained.The exhibits are maintained in the appeal file, but are not part of the evidentiary record for determination of value.None of the exhibits provided any market data addressing the question of what a willing buyer and seller would have agreed to as the purchase price on January 1, 2009.
Complainant testified that during 2009 the front and interior doors had been replaced.However, the evidence was insufficient to establish that these improvements to the home had materially altered the value.Therefore the assessed value for 2009 remains the assessed value for 2010.[2]
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, 2009, to be $85,000, as proposed.
5.Respondent’s Evidence.Respondent presented the appraisal report[3] and testimony of Terry Kraus, Residential Real Estate Appraiser for St. Louis County.The appraiser concluded a fair market value derived from the sales comparison approach of $105,000.The properties relied upon by Respondent’s appraiser were comparable to the subject property. The four properties utilized in the appraisal were located within less than a half mile of the subject.Each sale property sold at a time relevant to the tax date of January 1, 2009.The sale properties were similar to the subject in style, quality of construction, age, condition, room, bedroom and bathroom count, living area, location, site size and other amenities of comparability.The appraiser made various adjustments to the comparable properties for differences which existed between the subject and each comparable.All adjustments were appropriate to bring the comparables in line with the subject for purposes of the appraisal problem.Respondent’s evidence constituted substantial and persuasive evidence to affirm the assessment made by the Board of Equalization.
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.[4]
Presumptions In Appeals
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.[5]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.[6]The taxpayer failed to present evidence to meet the required standard, therefore, the presumption of correct assessment was not rebutted.Respondent presented substantial and persuasive evidence to substantiate the assessment concluded by the Board.
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.[7]True value in money is defined in terms of value in exchange and not value in use.[8]It is the fair market value of the subject property on the valuation date.[9]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.[10]
Respondent’s appraiser arrived at a conclusion of value utilizing the Standard for Value.[11]
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.[12]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.[13]Complainant failed to present an opinion of value derived from one of the recognized appraisal methodologies.Respondent’s appraiser concluded a value for the subject property relying on the sales comparison approach to value.When valuing owner occupied residential properties, this approach is generally recognized as the most reliable when sufficient market data is available to the appraiser.Such was the case in this instance, as Mr. Kraus was able to locate four sales which were comparable to the subject.
Complainant Failed to Meet 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, 2009.[14]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.”[15]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[16]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.[17]
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value.[18]The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.[19]Mr. Niemetz’s opinion of $85,000 was not supported by any market data from which the Hearing Officer could reasonably and rationally determined that the tendered value represented what a willing buyer and seller would have agreed to as the price on January 1, 2009.Since the owner’s opinion of value was not supported by an appraisal methodology recognized by the Courts and the Commission it can be given no probative weight.Complainant did not establish by substantial and persuasive evidence that his opinion as owner was based upon proper appraisal elements or a proper valuation foundation.Therefore, Mr. Niemetz failed to meet the burden of proof required of a Complainant in an appeal before the Commission.Accordingly, the assessment made by the Board of Equalization is presumed to be correct and must be affirmed.
ORDER
The assessed valuation for the subject property as determined by the Board of Equalization for St. Louis County for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax years 2009 and 2010 is set at $19,950.
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, 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. [20]
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 2, 2010.
STATE TAX COMMISSION OFMISSOURI
_____________________________________
W. B. Tichenor
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 2ndday of July, 2010, to:Gary Niemetz, 8520 Vasel Ave., St. Louis, MO 63123, Complainant; Paula Lemerman, Associate County Counselor, County Government Center, 41 South Central Avenue, Clayton, MO 63105, Attorney for Respondent; Michael Brooks, ActingAssessor, County Government Center, 41 South Central Avenue, Clayton, MO 63105; John Friganza, Collector, County Government Center, 41 South Central Avenue, Clayton, MO 63105.
___________________________
Barbara Heller
Legal Coordinator
Contact Information for State Tax Commission:
Missouri State Tax Commission
301 W. High Street, Room 840
P.O. Box 146
Jefferson City, MO 65102-0146
573-751-2414
573-751-1341 Fax
[5] 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).
[6] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
[7] 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).
[8] Daly v. P. D. George Company, et al, 77 S.W.3d 645, 649 (Mo. App E.D. 2002), citing, Equitable Life Assurance Society v. STC, 852 S.W.2d 376, 380 (Mo. App. 1993); citing, Stephen & Stephen Properties, Inc. v. STC, 499 S.W.2d 798, 801-803 (Mo. 1973).
[10] 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.
[12] 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).
[13] 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).
[15] 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).
[18] 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).
[19] 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).