State Tax Commission of Missouri
JAMES M. WEBB,)
v.) Appeal Number 07-33003
RICK KESSINGER, ASSESSOR,)
DECISION AND ORDER
Decision of the Greene County Board of Equalization sustaining the assessment made by the Assessor is AFFIRMED.True value in money for the subject property for tax year 2007 and 2008 is set at $328,100, assessed value of $62,340, residential value.
Complainant appeared in person.
Respondent appeared in person and by Counsel Nichole Lindsey.
Case heard and decided by Hearing Officer Maureen Monaghan.
The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2007.
Complainant appeals, on the ground of overvaluation, the decision of the Greene County Board of Equalization.The Assessor determined a true value of $328,100, assessed value of $62,340, as residential property. The Board sustained the value. Complainant proposed a value of $260,000, assessed value of $49,400.A hearing was conducted on February 6, 2008, at the Historic County Courthouse, Springfield, Missouri.
The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
The following exhibits were offered into evidence on behalf of the Complainant:
Exhibit A – Notice of Change in Assessment 2007
Exhibit B – GreeneCountyAccountStatus
Exhibit C – Board of Equalization Docket
Exhibit D – Consultation Report
Exhibit E – Appraisal Report by Steven Kittle
Exhibit F – Greene CountyAssessor’s Information on1616 S. Farm Road205
Exhibit G – Map
Exhibit H – Listing of Properties Near Comparables
Exhibit I – Photographs of Properties
Exhibit J – Photograph of Subject Property
Respondent objected to Exhibit D on the basis of hearsay and lack of foundation.Objection sustained.Respondent objected to Exhibit F on the basis of relevancy.Objection sustained. Respondent objected to Exhibit H on the basis of lack of foundation.Objection sustained. Respondent objected to Exhibit I on the basis of lack of foundation.Objection overruled. All remaining Exhibits were received into evidence.
Testimony of James M. Webb.
Prior to going on the record, exhibits were exchanged between the parties.Complainant was informed that Exhibits D and E may not be admitted into evidence if the preparer of the reports was not present.Mr. Webb was provided with additional time to secure the witnesses.Mr. Steven Kittle, certified real estate appraiser, testified.
The following exhibits were received into evidence on behalf of the Respondent:
Exhibit 1 – Appraisal Report.
Exhibit 2 – Property Record Card.
All Exhibits were received into evidence.
Testimony of Suzan Tanzer
FINDINGS OF FACT
1.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the decision of the Greene County Board of Equalization.
2.The subject property is located at4010 E. Farm Road156,Springfield,Missouri.The property is identified by parcel number:88-19-03-100-078.The property consists of a 5.49 acre lot improved by a one and one half story, single-family home structure of good quality construction.The structure is approximately 8 years old.The residence has three bedrooms, three and one half baths, and contains 3,304 square feet of living area.The structure is built upon a crawl space.There is a two-car attached garage.
3.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, 2007, to be $260,000.
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.Article X, section 14, Mo. Const. of 1945; Sections 138.430, 138.431, RSMo.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.Section 138.431.4, RSMo.
Presumptions In Appeals
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.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).
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.
Notwithstanding the provision of Section 138.431.3, RSMo – “There shall be no presumption that the assessor’s valuation is correct,” – the Supreme Court of Missouri has held, “A tax assessor’s valuation is presumed correct.”Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341 (Mo. 2005). Citing to Hermel, supra; and Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
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 assessor’s or Board’s valuation is erroneous and what the fair market value should have been placed on the property.Snider, Hermel & Cupples Hesse, supra.
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.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).It is the fair market value of the subject property on the valuation date.Hermel, supra.
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 is 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 each 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.
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; Exhibit 1, p. 2.
Missouricourts have approved the comparable sales or market approach, the cost approach and the income approach as recognized methods of arriving at fair market value. 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).The sales comparison approach is generally the best suited approach for the appraisal of owner occupied residences.When there is adequate and sound market data, the sales comparison approach provides the best evidence of value for an appraisal problem of this nature.
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, 2007.Hermel, Inc. v. State Tax Commission, 564 S.W.2d 888, at 897.Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.See, Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).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.Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975).See also, 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).
Complainant’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value. Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970).The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965).
The owner did testify at the hearing.The owner purchased the land in 1997 for $60,000 and spent approximately $160,000 to finish 3200 to 3500 square feet of living area.The owner acted as the general contractor when he built the home and worked on the home himself.
Steven Kittle testified for the Complainant.Mr. Kittle is a certified real estate appraisal and completed a written appraisal on January 30, 2008, with an effective date of the appraisal of January 28, 2008.Mr. Kittle developed a cost and a sales comparable approach.
Mr. Kittle found an indicated value by the cost approach of $304,962.He determined that the site value as of January, 2008 was $65,000.He determined that the cost new of the structure as of January 28, 2008, was $260,131 and that there was depreciation of $21,699 and as-is value of site improvements of $1,500.
Mr. Kittle found an indicated value by the sale comparison approach of $285,000 as of January 28, 2008.Mr. Kittle found six sales which occurred from April 2007 to a contract pending and a property still for sale.The comparables were located 1.3 to 9.83 miles from the subject property.Mr. Kittle relied primarily on comparables 1 and 2.Comparable 1 sold in May 2007 for $262,900 and is within 1.2 miles of the subject.An upward adjustment of $5000 was made to Comparable 1 for the difference in lot size, 5.49 acres on the subject property and ½ acre on the comparable.Upward adjustments of $20,700 and $500 were made for the difference in square footage and bathroom count.A downward adjustment was made for the difference in age of the comparable property as the comparable property is only one year old.A $7500 downward adjustment was made for the additional garage space in the comparable.
Comparable 2 sold in June 2007 for $347,000 and is within ½ mile of the subject.A $10,000 downward adjustment was made for location, a $15,000 downward adjustment was made for quality of construction, an $11,000 downward adjustment was made for gross living area, and a $12,500 downward adjustment was made for garage space and porches.
Assessor’s Opinion of Value
The Assessor presented the testimony of Suzan Tanzer, a real property appraiser at the Greene County Assessor’s Office.Ms. Tanzer presented an appraisal of the subject property.Ms. Tanzer developed the cost approach and the sales comparison approach.Using the cost approached, she determined a value of $399,801.She determined that the site value as of January, 2007 was $89,900.She determined that the cost new of the structure as of January 1, 2007 was $343,205 and that there was depreciation of $56,304 and as-is value of site improvements of $23,000.
Using the sales approach, she determined a value of $333,000.She relied primarily upon the sales comparison approach as it is the most indicative of buyers and sellers in the market place.Ms. Tanzer found five sales within 3.5 miles of the subject.The properties sold in February 2005 to January 2007 from between $264,900 and $416,750.Adjustments were made for the differences in the property.The net adjustments ranged from -$2,150 to $65,300 resulting in values from $327,850 to $353,900.Ms. Tanzer most weighted Comparables 2, 3, and 4 due to their construction over a crawl space.Comparable 4 was considered most similar due to its location (7.5 blocks from subject), date of sale (July 2006), above grade square footage (within 400 square feet) and crawl space construction. Comparable 4 was adjusted for its lot size (3.3 acres smaller, $33,000 adjustment), its age (17 years older, $25,500 adjustment), additional garage space (-$10,000 adjustment), covered porch (-$15,000) and square footage/room count (174 additional square feet, 2 additional bedrooms for -$3,950 adjustment).
The properties relied upon by Respondent’s appraiser in performing her appraisal were comparable to the subject property for the purpose of making a determination of value of the subject property. The appraiser properly adjusted for differences between the subject and each sale property.The adjustments made were appropriate for the present appraisal problem.
Complainants’ evidence failed to establish that the subject property in an open market transaction on January 1, 2007, would have sold for only $260,000.The appraisal report presented determined a value for the property as of January 28, 2008 rather than the date of January 1, 2007.No evidence was presented to adjust the value for time.Having failed to meet his burden of proof, the value determined by the Assessor which was sustained by the Board is affirmed.
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization forGreeneCountyfor the subject tax day is AFFIRMED.
The assessed value for the subject property for tax years 2007 and 2008 is set at $328,100 assessed value of $62,340.
A party may file with the Commission an application for review of this decision within thirty (30) days of the mailing of such decision.The application shall contain specific grounds upon which it is claimed the decision is erroneous.Failure to state specific facts or law upon which the appeal is based will result in summary denial.Section 138.432, RSMo 2000.
If an application for review of this decision is made to the Commission, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the Commission.If no application for review is received by the Commission within thirty (30) days, this decision and order is deemed final and the Collector of GreeneCounty, 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.If any or all protested taxes have been disbursed pursuant to Section 139.031(8), RSMo, either party may apply to the circuit court having jurisdiction of the cause for disposition of the protested taxes held by the taxing authority.
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 February 19, 2008.
STATE TAX COMMISSION OFMISSOURI
Certificate of Service
I hereby certify that a copy of the foregoing has been mailed postage prepaid this 19thday of February, 2008, to:James Webb, 4010 E. Frd. 156, Springfield, MO 65809, Complainant; Theodore Johnson, Greene County Counselor, 901 St. Louis Street, 20th Floor, Springfield, MO 65806, Attorney for Respondent; Rick Kessinger, Assessor; Richard Struckhoff, Clerk; Scott Payne, Collector, Greene County Courthouse, 940 Boonville, Springfield, MO 65806.