Gary Singleton v. Jake Zimmerman, Assessor, St. Louis County, Missouri

STATE TAX COMMISSION OF MISSOURI

GARY SINGLETON,	)	Appeal No. 21-10165
	)	Parcel No. 24N120747
Complainant,	)
	)
v.	)
	)
JAKE ZIMMERMAN, ASSESSOR,	)
ST. LOUIS COUNTY, MISSOURI,	)
	)
Respondent.	)

ORDER AFFIRMING HEARING OFFICER DECISION UPON APPLICATION FOR REVIEW

HOLDING

On July 1, 2022, State Tax Commission (STC) Senior Hearing Officer Eric Peterson (Hearing Officer) entered a Decision and Order (Decision) affirming the St. Louis County Board of Equalization’s (BOE) assessment of the subject property as of January 1, 2021.  Gary Singleton (Complainant) timely filed an Application for Review of the Decision and Order of the Hearing Officer.  Jake Zimmerman, Assessor, St. Louis County, Missouri, (Respondent) timely filed a Response.

We AFFIRM the Decision of the Hearing Officer. Segments of the Hearing Officer’s Decision may have been incorporated into our Order without further reference.

FINDINGS OF FACT AND PROCEDURAL HISTORY

The subject property is identified by Parcel Locator No. 24N120747. The subject property is further identified as residential property consisting of a single-family home located at 1326 Craig Road in Kirkwood, Missouri.       

Respondent assessed the subject property as residential property as of January 1, 2021, with a true value in money (TVM) of $229,000.[1]  Complainant appealed Respondent’s assessment to the BOE, and the BOE determined the TVM of the subject property as of January 1, 2021, was $229,000.

Complainant timely filed an appeal of the BOE’s valuation to the STC.  The appeal proceeded to an Evidentiary Hearing in which both parties presented evidence.  The Hearing Officer subsequently issued the Decision finding that Complainant did not present substantial and persuasive evidence to rebut the BOE’s valuation and to place a different value on the subject property.  The Decision found that the TVM of the subject property as of January 1, 2021, was $229,000.

Complainant timely filed an application for review.  The STC thereafter issued its Order allowing the application for review and granting Respondent time to file a response.  Respondent timely filed his response.

CONCLUSIONS OF LAW

Complainant’s Points on Review

Complainant does not allege that the Hearing Officer’s Decision was erroneous for a specific reason; rather, Complainant argues that the subject property should have been valued at the same TVM as it had been valued as of January 1, 2019, $209,000, which was the value to which both Complainant and Respondent had agreed by stipulation.  Complainant argues that the BOE’s valuation should be reduced due to widespread inflation, the need for repairs to the subject property, and the damage to trees situated on the subject property due to water runoff from neighboring properties.

Standard of Review

A party subject to a Decision and Order of a hearing officer of the STC may file an application requesting the case be reviewed by the STC.  Section 138.432.  The STC may then summarily allow or deny the request.  Section 138.432.  The STC may affirm, modify, reverse, set aside, deny, or remand to the Hearing Officer the Decision and Order of the Hearing Officer on the basis of the evidence previously submitted or based on additional evidence taken before the STC.  Section 138.432.    

Commission’s Ruling

 For the reasons that follow, the Commission finds Complainant’s arguments to be unpersuasive.  The Commission, having thoroughly reviewed the whole record and having considered the Hearing Officer’s Decision, the application for review of Complainant, and the response of Respondent, affirms the Hearing Officer’s decision.

The taxpayer in a STC appeal bears the burden of proof. The taxpayer is the moving party seeking affirmative relief.  Therefore, Complainant bears the burden of proving by substantial and persuasive evidence the vital elements of the case, i.e., the assessment was “unlawful, unfair, improper, arbitrary, or capricious.”   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. W.D. 1991).  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).

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 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).

“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 v. Casino Aztar/Aztar Mo. Gaming Corp., 156 S.W.3d 341, 347-48 (Mo. banc 2005).  The comparable sales approach is typically used to value residential property.  The comparable sales approach requires data from sales, not estimates or listings.

Complainant presented Exhibits A through D:

Exhibit A	Letter from Complainant
Exhibit B	Series of 12 photographs showing the downhill slope from a large, neighboring residence and several mature, dead oak trees Complainant testified were caused by water drainage from the neighboring residence.
Exhibit C	BOE Appeal Form showing Complainant proposed a value of $200,000.
Exhibit D	Stipulation in appeal 19-10802 showing Complainant and Respondent settled Complainant’s 2019 STC appeal regarding the subject property with a stipulated TVM of $209,000.

 

None of the exhibits constituted a court-approved approach to valuing property.  In particular, none of the exhibits constituted a comparable sales approach to valuing the subject property, which is the approach typically used to determine the value of residential property.  The exhibits did not make any market-based adjustments to the comparable properties or to provide quantifiable data from which adjustments to the value of the subject property could be made due to the need for repairs or due to tree damage caused by runoff from neighboring properties.  With regard to Complainant’s argument regarding the impact of inflation on the ability to pay property taxes, we note that the STC is a quasi-judicial agency in the Executive Branch of state government with limited jurisdiction over appeals from locals BOEs.  The STC is specifically prohibited from being involved in the levy setting or tax collection process.  See Section 138.340.  We further note that the Hearing Officer was cognizant of Complainant’s argument regarding the ability to pay taxes and concluded:

Complainant persuasively testified the property taxes on the subject property are difficult to afford because he is a retiree on fixed income.  The undersigned hearing officer, however, is bound by the General Assembly’s directive to review the assessment to determine ‘the correct valuation to be placed on such property’ and to ‘correct any assessment or valuation which is shown to be unlawful, unfair, improper, arbitrary or capricious.’  Section 138.430.1.  As established, the benchmark for assessments is the property’s TVM, or fair market value as of January 1, 2021. Sections 137.115.1; 137.115.5(1)(a).  A property’s fair market value does not vary according to the owner’s ability to pay the taxes.  Consequently, for purposes of this STC appeal, Complainant’s ability to afford property taxes is not a basis for concluding the subject is overvalued. 

We agree with the Hearing Officer’s findings and conclusions.

ORDER

The Decision of the Hearing Officer is AFFIRMED.  Segments of the Decision and Order of the Hearing Officer, including the findings of fact and conclusions of law therein, may have been 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 within 30 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.

If no judicial review is made within 30 days, this decision and order is deemed final and the Collector of St. Louis 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 October 21, 2022.

STATE TAX COMMISSION OF MISSOURI

Gary Romine, Chairman

Victor Callahan, Commissioner

Debbi McGinnis, Commissioner

Certificate of Service

I hereby certify that a copy of the foregoing has been electronically mailed and/or sent by U.S. Mail on October 21, 2022, to: Complainant(s) and/or Counsel for Complainant(s), Respondent and/or Counsel for Respondent and County Collector.

Noah Shepard

Legal Coordinator

[1] Missouri operates on a two-year reassessment cycle for valuing real property. See Section 137.115.1 RSMo. Absent new construction or improvements to a parcel of real property, the assessed value as of January 1 of the odd year remains the assessed value as of January 1 of the following even year. Id. All statutory references are to RSMo. 2000, as amended, unless otherwise indicated.

STATE TAX COMMISSION OF MISSOURI

GARY SINGLETON,	)	Appeal No. 21-10165
	)	Parcel No. 24N120747
Complainant,	)
	)
v.	)
	)
JAKE ZIMMERMAN, ASSESSOR,	)
ST. LOUIS COUNTY, MISSOURI,	)
	)
Respondent.	)

DECISION AND ORDER

Gary Singleton (Complainant) appealed the St. Louis County Board of Equalization’s (BOE) decision finding the true value in money (TVM) of the subject residential property was $229,000 as of January, 1, 2021.^[1] Complainant alleges overvaluation and discrimination and proposes a value of $200,000.  The BOE decision is affirmed.  The TVM of the subject property as of January 1, 2021, was $229,000.

FINDINGS OF FACT

1. The Subject Property. The subject residential property consists of a single-family home located at 1326 Craig Road in Kirkwood, Missouri.
2. Assessment and Valuation. The BOE determined the TVM of the subject property as of January 1, 2021, was $229,000.
3. Complainant’s Evidence. Complainant introduced Exhibits A through D.  Complainant’s exhibits are summarized as follows:

Exhibit A	Letter from Complainant
Exhibit B	Series of 12 photographs showing the downhill slope from a large, neighboring residence and several mature, dead oak trees Complainant testified were caused by water drainage from the neighboring residence.
Exhibit C	BOE Appeal Form showing Complainant proposed a value of $200,000.
Exhibit D	Stipulation in appeal 19-10802 showing Complainant and Respondent settled Complainant’s 2019 STC appeal regarding the subject property with a stipulated TVM of $209,000.

Complainant testified the property taxes on the subject property are difficult to afford because he is a retiree on fixed income.  Complainant testified Exhibit D shows the 2021 assessment is excessive because the parties settled the 2019 appeal regarding the subject property with a stipulated value of $209,000.

Complainant also testified the subject property began experiencing excessive water runoff following the construction of a large residence on a neighboring lot.  Complainant testified the neighboring residence was constructed in approximately 2013.  Complainant testified the resulting water runoff has caused areas of the subject property to be persistently wet, resulting in the death of several large oak trees and some dogwood trees.  Complainant testified there is water intrusion into the subject’s basement following heavy rains because of the runoff from the adjacent residence.  Complainant testified the home on the subject property needs a new roof and tuck pointing on the chimney.  Complainant offered no evidence of comparable sales.

4. Respondent’s Evidence. Respondent’s evidence consisted solely of Exhibit 1, a copy of the BOE decision letter determining the subject appraised value as of January 1, 2021, was $229,000.
5. Value. The TVM of the subject property as of January 1, 2021, was $229,000.

CONCLUSIONS OF LAW

1. Assessment and Valuation. Residential real property is assessed at 32% of its TVM as of January 1 of each odd-numbered year. Sections 137.115.1; 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).
2. Evidence. 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). “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).
3. Complainant’s Burden of Proof. The taxpayer bears the burden of proof and must show by a preponderance of the evidence the property is 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.

Single-family homes are typically valued with the sales comparison approach because of the ready availability of sales data.  Complainant did not perform a sales comparison analysis, a comparative market analysis, or any other evidence of market-based transactions of similar homes.

Complainant persuasively testified the property taxes on the subject property are difficult to afford because he is a retiree on fixed income.  The undersigned hearing officer, however, is bound by the General Assembly’s directive to review the assessment to determine “the correct valuation to be placed on such property” and to “correct any assessment or valuation which is shown to be unlawful, unfair, improper, arbitrary or capricious.”  Section 138.430.1.  As established, the benchmark for assessments is the property’s TVM, or fair market value as of January 1, 2021. Sections 137.115.1; 137.115.5(1)(a).  A property’s fair market value does not vary according to the owner’s ability to pay the taxes.  Consequently, for purposes of this STC appeal, Complainant’s ability to afford property taxes is not a basis for concluding the subject is overvalued.

Complainant testified Exhibit D shows the parties settled the 2019 appeal regarding the subject property with a stipulated value of $209,000.  Complainant testified the 2021 reassessment at $229,000 was made just months after the parties stipulated the value was $209,000.   The stipulated value for the 2019 appeal reflects the subject’s value as of January 1, 2019, two years prior to the January 1, 2021, valuation date at issue in this appeal.   There is no evidence in the record showing the 9.6% increase in value between January 1, 2019, and January 1, 2021, exceeds the subject’s market-based price appreciation.[2]   Exhibit D is not substantial and persuasive evidence showing the subject was overvalued as of January 1, 2021.

Complainant testified the large, neighboring residence created water drainage issues causing the death of several large, mature oak trees as well as several dogwood trees. Given Complainant’s horticultural background and knowledge, his testimony persuasively establishes the tree mortality is a result of the water drainage from the neighboring residence.  However, Complainant testified the oak trees died in late 2021, after the January 1, 2021, valuation date.  Therefore, oak tree mortality could not be a detriment to the subject’s value as of January 1, 2021.  Moreover, even if tree loss was predictable as of January 1, 2021, Complainant offered no evidence showing the impact of the tree loss on the subject market value as of January 1, 2021.  Complainant testified it would likely cost between $4,000 and $5,000 to remove the trees, but there is no evidence showing this unverified estimate in fact negatively impacted the subject’s January 1, 2021, market value.

Finally, Complainant testified the drainage issues caused intermittent water intrusion during heavy rains.  There is no evidence quantifying the effect, if any, of this water intrusion on the subject’s January 1, 2021, market value.  Complainant did not produce substantial and persuasive evidence of overvaluation.

5. Complainant Did Not Produce Substantial and Persuasive Evidence of Discrimination.

Both the United States and Missouri constitutions prohibit discriminatory taxation of similarly situated taxpayers.  Savage v. State Tax Comm’n of Missouri, 722 S.W.2d 72, 78 (Mo. banc 1986).   To prove discrimination, a property owner must first prove the fair market value of the subject property on the valuation date.  Id.  After proving fair market value, the property owner can prove discrimination by showing an “intentional systematic undervaluation . . . of other taxable property in the same class.”  State ex rel. Ashby Rd. Partners, LLC, v. State Tax Comm’n, 297 S.W.3d 80, 85 (Mo. banc 2009) (internal quotation omitted).  In the absence of intentional discrimination, a discrimination claim requires proof that the level of assessment is “so grossly excessive as to be inconsistent with an honest exercise of judgment.”  Savage, 722 S.W.2d at 78.

Complainant’s discrimination claim as denominated on the complaint for review of assessment must fail because he did not “first prove the fair market value of the subject property on the valuation date.”  Savage, 722 S.W.2d at 78.    Further, though not asserted, if Complainant proceeded on the theory the BOE value represented fair market value, the Complainant’s still offered no evidence of discrimination.  There is no evidence Respondent singled out Complainant’s property for discriminatory assessment.  Nor is there any evidence of “intentional systematic undervaluation . . . of other taxable property in the same class.”  Ashby Rd. Partners, 297 S.W.3d at 85.  Complainant did not produce substantial and persuasive evidence of discrimination.

CONCLUSION AND ORDER

The BOE’s decision finding the subject property’s appraised value was $229,000 as of on January 1, 2021, is affirmed.   The TVM as of January 1, 2021, was $229,000.

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 July 1, 2022.

Eric S. Peterson

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 July 1, 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] 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.

[2] [(229,000 – 209,000) / 209,000] = 0.956.