STATE TAX COMMISSION OF MISSOURI
| GLENN D. SHOEMAKER, JR., | ) | Appeal No. 20-77501 |
| Complainant(s), | ) | Parcel/locator No(s): 183208000002511 |
| ) | ||
| v. | ) | |
| ) | ||
| CHRISTOPHER WOOLERY, ASSESSOR, | ) | |
| PETTIS COUNTY, MISSOURI, | ) | |
| Respondent. | ) | |
| ) |
DECISION AND ORDER
Glenn D. Shoemaker, Jr., (Complainant) appeals the determination made by Christopher Woolery, Assessor, Pettis County, Missouri, (Respondent) that the true value in money (TVM) of the subject property on January 1, 2020, was $385,368, with an assessed value of $73,220.[1] Complainant claims the property is overvalued and proposes a value of $300,000. Complainant did not produce substantial and persuasive evidence establishing overvaluation. The valuation determined by Respondent is affirmed.[2]
Complainant appeared pro se. Respondent appeared pro se. The evidentiary hearing was conducted on March 3, 2021, via WebEx and conference telephone call.
FINDINGS OF FACT
- Subject Property. The subject property is located at 32000 Hill Lane, Sedalia, Pettis County, Missouri. The parcel/locator number is 183208000002511.
The subject property consists of a three-acre lot improved by a 2,654 square-foot, two-story, single-family home. The subject property has three bedrooms; two full bathrooms and one half bathroom; one fireplace; a full walkout basement with 1,800 square feet of “living quarters”; a two-car attached garage; a wood deck; and two concrete pads or patios. (Exhibit B; Exhibit D)
- Respondent and BOE. Respondent classified the subject property as residential and determined the TVM on January 1, 2020, was $385,368. As stated in FN1, Complainant did not appeal to the BOE but appealed directly to the STC.
- Complainant’s Evidence. Complainant testified that his opinion of the TVM of the subject property on January 1, 2020, was $300,000 to $325,000 “with everything completed.” Complainant introduced the following exhibits:
| Exhibit | Description | Ruling |
| A | Listing of four comparable properties prepared by Remax with sale dates ranging from August 2020 to December 2020 and sale prices ranging from $285,000 to $330,000 | Admitted |
| B | Beacon document for subject property listing characteristics and showing dated photographs of lot and exterior of home in various stages of completion | Admitted |
| C | Undated photographs of interior of unfinished walk out basement, including hot water tank, water softener, HVAC unit, interior drain tile, and sump pump systems | Admitted |
| D | Photographs of original tax bill, tax bill with paid under protest notice, paid receipt, copy of payment/check | Admitted |
Respondent did not object to any of Complainant’s exhibits.
Complainant testified that he purchased the land in 2017 for $17,500, started construction on the home in 2018, and moved into the home in August 2020. Complainant testified that the cost to construct the home was $283,000, and that the subject property had a mortgage in the amount of approximately $280,000. Complainant testified that the subject property had not been appraised in the three years preceding the evidentiary hearing but that he had received a “pre-appraisal” by the mortgage bank. Complainant testified that the mortgage bank could not find the final appraisal. Complainant testified that the subject property had not been listed for sale within the past three years but that he would price it at $285,000 to $300,000 if he listed it for sale. Complainant testified that between January 1, 2019, and January 1, 2020, he tried to get the home completed so it would be livable, which included installing windows, siding, laminate flooring, sheetrock, lighting fixtures, bathroom fixtures, and carpet.
On cross examination, Complainant testified that the subject property had been appraised in 2018 for $325,000 “with everything completed.” Complainant testified that he had been transparent with Respondent’s office while the home was being constructed; however, Complainant admitted that he did not allow Respondent’s office to view the interior of the subject property to verify that some areas of the home, such as the basement, were not finished. Complainant’s Exhibit B described the home as having a finished walk-out basement with 1,800 square feet of “living quarters.” (Exhibit B)
- Respondent’s Evidence. Respondent did not introduce any exhibits. Respondent testified that his opinion of TVM of the subject property as of January 1, 2020, was $385,000. Respondent testified that an appraisal of the subject property in 2018 showed an increasing market and that a time adjustment to value from 2018 to 2020 resulted in a valuation of at least $350,000. Respondent testified that he was unable to verify whether the basement was finished because Complainant would not allow an inspection. Respondent further testified that Pettis County is an occupancy county and, because two criteria for occupancy were met, the property was placed on the assessment roll in 2018 at full value. Respondent testified that, after talking with Complainant, Respondent removed the subject property from the tax roll due to the house being unfinished and did not put the subject property on the assessment roll for 2019. Respondent testified that he placed the subject property on the assessment roll for 2020.
On cross examination, Respondent testified that a home is considered complete when it is considered occupied. Respondent repeated that his office could not verify whether the basement was finished or unfinished, so Respondent “put it on at full value.” In response to cross examination by Complainant, Respondent testified that he does not appraise landscaping and that the property record card showed only a concrete pad and no detatched garage was present. In response to further cross examination, Respondent testified that he did not know whether Complainant had been honest and had kept Respondent well informed as the home was being built. Respondent testified that Complainant had called Respondent’s office in August 2020 to state he had moved into the home.
- Value. The TVM of the subject property on January 1, 2020, was $385,368, with an assessed value of $73,220.
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). “True value in money is the fair market value of the property on the valuation date, and is a function of its highest and best use, which is the use of the property which will produce the greatest return in the reasonably near future.” 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). Determining the TVM is a factual issue for the STC. Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008). The “proper methods of valuation and assessment of property are delegated to the Commission.” Savage v. State Tax Comm’n, 722 S.W.2d 72, 75 (Mo. banc 1986).
“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; see also St. Louis Cty. v. Sec. Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977).
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.
- 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). The finder of fact in an administrative hearing determines the credibility and weight of expert testimony. Hornbeck v. Spectra Painting, Inc., 370 S.W.3d 624, 632 (Mo. banc 2012). “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.
- Complainant’s Burden of Proof
The BOE’s valuation is presumptively correct. Rinehart v. Laclede Gas Co., 607 S.W.3d 220, 227 (Mo. App. W.D. 2020). To prove overvaluation, a taxpayer must rebut the BOE’s presumptively correct valuation and prove the “value that should have been placed on the property.” Snider, 156 S.W.3d at 346. The taxpayer’s evidence must be both “substantial and persuasive.” 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, 722 S.W.2d at 77 (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”). A taxpayer does not meet his burden if evidence on any essential element of his case leaves the STC “in the nebulous twilight of speculation, conjecture and surmise.” See, Rossman v. G.G.C. Corp. of Missouri, 596 S.W.2d 469, 471 (Mo. App. 1980).
Here, Complainant did not appeal to the BOE, as described in FN 1. However, in an appeal before the STC, Complainant still bears the burden of proving by substantial and persuasive evidence that his opinion of the TVM of the subject property on the taxation date is correct.
- Complainant Did Not Prove Overvaluation.
Complainant did not present substantial and persuasive evidence of establishing his opinion of the subject property’s TVM as of January 1, 2020, is correct. Although Complainant’s Exhibit A showed purported comparable properties with sale prices ranging from $285,000 to $330,000, Exhibit A did not constitute a sales comparison approach to valuing the subject property because no market-based adjustments were made to the comparable properties to account for their similarities to and differences from the subject property. Notably, the ages of the comparable properties in Exhibit A ranged from seven years to 34 years, with a median age of 24 years. The subject property was less than two-years-old on January 1, 2020. The comparable properties had lot sizes of an acre or less. The subject property had a lot size of three acres.[3] Furthermore, Complainant’s Exhibit C, the photographs showing the basement in an unfinished state, were not dated and, therefore, did not establish whether the basement was in an unfinished state on January 1, 2020. The photographs of the exterior of the home in Exhibit B, however, implied that the basement was finished in 2019. Consequently, Complainant’s evidence was not persuasive evidence to support Complainant’s opinion of value of the subject property as of January 1, 2020. While a property owner’s opinion of value is generally admissible, the opinion “is without 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).
CONCLUSION AND ORDER
The valuation determined by Respondent is affirmed. The TVM of the subject property as of January 1, 2020, was $385,368, with an assessed value of $73,220.
Application for Review
A party may file with the Commission 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, 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 Pettis 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.
SO ORDERED May 7, 2021.
STATE TAX COMMISSION OF MISSOURI
Amy S. Westermann
Chief Counsel
Certificate of Service
I hereby certify that a copy of the foregoing has been electronically mailed and/or sent by U.S. Mail on May 7, 2020, to:
Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
Elaina McKee
Legal Coordinator
[1] Complainant did not appeal the Assessor’s valuation to the BOE. During the course of this appeal, the parties disputed whether the appeal should be allowed to proceed given that it was filed directly with the State Tax Commission (STC) and was not heard and decided first by the BOE. The tax bill was mailed to Complainant in November 2020. A notice of change of assessment (CAN notice) for 2020 was mailed to Complainant on June 16, 2020. The CAN notice informed Complainant that the deadline for filing an appeal to the BOE was June 30, 2020. Under 12 CSR 30-3.010(1)(B)1, a property owner may appeal directly to the STC where the property owner is not notified of an initial assessment or an increase in assessment from the previous year at least 30 days before the deadline for filing an appeal with the BOE.
[2] Complainant timely filed a complaint for review of assessment. The STC has authority to hear and decide Complainant’s appeal. Mo. Const. art. X, Section 14; Section 138.430.1, RSMo 2000. All statutory citations are to RSMo 2000, as amended.
[3] Exhibit D, the tax bill for the subject property, showed the lot size as “4.000” acres.