State Tax Commission of Missouri
HUNTER LANE & FULTON APTS,)
v.) Appeal Number 09-46501
DANIEL ROE, ASSESSOR,)
CALLAWAY COUNTY, MISSOURI,)
DECISION AND ORDER
Decision of the Callaway County Board of Equalization sustaining the assessment made by the Assessor is SET ASIDE.True value in money for the subject property for tax years 2009 and 2010 is set at $1,065,530, residential assessed value of $202,450.Complainant appeared by Counsel Richard Dvorak, Overland Park, KS.Respondent appeared by Callaway County Prosecuting Attorney, Richard R. Sterner
Case decided by Senior Hearing Officer W. B. Tichenor.
Complainant appeals, on the ground of overvaluation, the decision of the Callaway 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 Callaway County Board of Equalization.Respondent waived his right to an evidentiary hearing and prayed the Commission to render its decision based on filings of exhibits and testimony from Complainant.
3.Subject Property.The subject property is located at 604 Airway Dr., Fulton, Missouri.The property is identified by map parcel number 13-4-18-104.001.The property is a subsidized housing facility.
4.Complainant’s Evidence.In compliance with the Commission’s Order of
January 12, 2010, Complainant filed its Completed Worksheet – Exhibit A.The Worksheet provided Actual Income and Expense figures and a capitalization rate based upon the actual loan terms applicable to the subject property.The Net Operating Income of $78,764 capitalized by the Overall Capitalization Rate of 7.293% produced an indicated value of $1,065,530.
Complainant’s evidence was 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 $1,065,530, residential assessed value of $202,450.
CONCLUSIONS OF LAW AND DECISION
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.
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.By statute real and tangible personal property is assessed at set percentages of true value in money. By Constitutional and statutory mandate, in an overvaluation appeal, true value in money for the property being appealed must be determined based upon the evidence on the record.The only evidence in this record on the issue of the value of the subject property is Complainant’s completed Worksheet.It is the document the Commission requires to be filed in appeals involving subsidized housing.
Presumption In Appeals
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.This presumption is a rebuttable rather than a conclusive presumption.It places the burden of going forward with some substantial evidence on the taxpayer – Complainant.When some substantial evidence is produced by the Complainant, “however slight,” the presumption disappears and the Hearing Officer, as trier of facts, receives the issue free of the presumption.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.Upon presentation of the Complainant’s evidence the presumption in this appeal disappeared.The case is decided free of the presumption.
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.True value in money is defined in terms of value in exchange and not value in use.It is the fair market value of the subject property on the valuation date.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.
Complainant Proves Value of $1,065,530
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.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.”
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.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.
Complainant’s Exhibit A established the true value in money of the property under the income approach relying on the income and expenses of the subject property for the years 2006, 2007 and 2008.See, Finding of Fact 4 – Complainant’s Evidence, supra.
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for Callaway County for the subject tax day is SET ASIDE.
The assessed value for the subject property for tax years 2009 and 2010 is set at $202,450.
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.
The Collector ofCallaway 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 November 4, 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 4th day of November, 2010, to:Richard Dvorak, 7111 W. 98th Terrace, Suite 140, Overland Park, KS 66212, Attorney for Complainant; Robert Sterner, Prosecuting Attorney, 10 East Fifth Street, Fulton, MO 65251, Attorney for Respondent; Daniel Roe, Assessor, 10 East Fifth Street, Fulton, MO 65251; Linda Love, Clerk, 10 East Fifth Street, Fulton, MO 65251; Pam Oestreich, Collector,10 East Fifth Street, Fulton, MO 65251.
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
“In the cases of Lake Ozark Village v. Whitworth, Appeals Number 97-47000, 99-47003 and 01-47002) and Maryville Properties v. Nelson, Appeal Number 97-74500, the State Tax Commission determined that the proper way to value subsidized housing properties is by use of actual income and expenses and actual financing terms.“Actual financing terms” are the terms and the equity requirements contained in the financing document executed by the taxpayer to obtain the loan.The decision of Maryville Properties was appealed to the Western District Court of Appeals.The Court of Appeals determined that the value of subsidized housing properties should not include the value of tax credits.In all other regards, the Court of Appeals upheld our decision and methodology.” Emphasis in original.
 When a Respondent fails to offer evidence of value, it creates an appearance of consent to the value presented by Complainant’s prima facie case (qui tacet consentire videtur – a party who is silent appears to consent).
 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)
 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).
 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.
 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).