State Tax Commission of Missouri
JUDITH WISTUBA,)
)
Complainant,)
)
v.) Appeal Number 09-51526
)
JERRY HOWARD, ASSESSOR,)
CLINTON COUNTY, MISSOURI,)
)
Respondent.)
DECISION AND ORDER
HOLDING
Decision of the Clinton County Board of Equalization setting market value at $196,000 (assessed value $37,240) is SUSTAINED.
Complainant appeared pro se.
Respondent appeared in person and through his counsel, Bill Burris.
Case heard and decided by Senior Hearing Officer Luann Johnson.
ISSUE
The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2009.
SUMMARY
Complainant appeals, on the ground of overvaluation, the decision of the Clinton County Board of Equalization, which reduced the Assessor’s original valuation of $206,420 (assessed value $39,220) for the subject property.The Board set value at $196,000 (assessed value $37,240).At hearing, Assessor’s appraiser proposed an appraised value of $200,000 (assessed value of $38,000, as residential property).Complainant proposed a value of $175,000 (assessed value of $33,250).A hearing was conducted on January 5, 2010, at the Clinton County Courthouse, Plattsburg, Missouri.
Complainant’s Evidence
Complainant presented the appraisal report of Gregory Fitch, which report was entered into evidence as Complainant’s Exhibit A.
Respondent’s Evidence
Respondent presented the appraisal report of James W. Downey, which report was entered into evidence as Respondent’s Exhibit 1.
FINDINGS OF FACT
1.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the decision of the Clinton County Board of Equalization.
2.The subject property is located at 7285 SW Karen Road, Trimble, Missouri.The property is identified by parcel number 13-06.2.23-000-000-006.019.The property consists of an 18,000 square foot lot improved by a one-story ranch, single-family structure of average quality construction in good condition.The property was approximately four years old on the tax day.The residence has 1,780 square feet of living area containing three bedrooms and two bathes.The property has a full basement with approximately five percent finish.Additionally, the home has an attached two-car garage.
3.There was no evidence of new construction and improvement from January 1, 2009, to January 1, 2010.
4.Complainant’s appraiser presented three proposed comparable sales located 6.92 miles southwest, 3.84 miles south and 4.34 miles south.Complainant’s appraiser testified that these sales were the closest sales of ranch style properties.Those properties contained 1,392 square feet; 1,501 square feet; and 1,625 square feet.Two properties were new and one was nine years old.The properties sold for $179,050 in April of 2008; $177,500 in July of 2008; and $185,000 in April of 2008.All three sales had three bedrooms but sale three was a reverse story and one half having one bedroom on the main level and two bedrooms on the lower level.All comparable sales were located in a different county and a different school district.No adjustments were made for difference in location.After adjustments, the properties indicated a range of value between $174,530 and $181,250.The properties required gross adjustments of 11.4%; 10.7%; and 13.5%.The appraiser also presented a sale listing as a comparable.Such listing is not considered for the purpose of determining value inasmuch as it is not a comparable sale.
5.Complainant’s appraiser failed to present a cost approach to value.
6.Respondent’s appraiser presented three proposed comparable sales located 0.21 miles southeast, 10.08 miles north, and 0.31 miles east.Sales one and three were in the subject property’s immediate neighborhood.All three properties were in the same county.Those properties contained 1,800 square feet; 1,400 square feet; 1,800 square feet.Two properties were four years old and one was 2 years old.The properties sold for $210,000 in September of 2008; $180,000 in October of 2008; and $246,000 in April of 2008.All three comparable had three bedrooms.Respondent’s appraiser testified that the market does not show that buyers have a preference for a ranch style home over other styles.Comparables one and three were California splits while comparable two was a split foyer.After adjustments, the properties indicated values of $190,700; $187,000 and $215,200.The properties required gross adjustments of 11.1%; 7.2% and 12.9%.However, upon cross examination, Respondent’s appraiser indicated that an additional $6,500 downward adjustment should have been made to sale number two, indicating an adjusted value of $180,500 and increasing the percentage of gross adjustment to the property.
7.Respondent’s appraiser prepared a cost approach to value which concluded a value of $231,465.
8.In order to prevail, Complainant must present substantial and persuasive evidence tending to indicate that the value determined by the Board of Equalization is incorrect.Complainant has failed to meet that standard of proof.As more fully discussed below, Respondent’s use of sales within Complainant’s neighborhood is more reliable than Complainant’s use of sales in a different county and a different school district.The decision of the Board of Equalization is sustained.The correct value for the subject property on January 1, 2009, and January 1, 2010, is $196,000 (assessed value $37,240).
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.[1]
Official and Judicial Notice
Agencies shall take official notice of all matters of which the courts take judicial notice.[2]
Courts will take judicial notice of their own records in the same cases.[3]In addition, courts may take judicial notice of records in earlier cases when justice requires[4] or when it is necessary for a full understanding of the instant appeal.[5] Courts may take judicial notice of their own records in prior proceedings involving the same parties and basically the same facts.[6]
Presumptions In Appeals
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.[7]
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.
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 Board’s valuation is erroneous and what the fair market value should have been placed on the property.[8]
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.[9]It is the fair market value of the subject property on the valuation date.[10]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.[11]
Duty to Investigate
In order to investigate appeals filed with the Commission, the Hearing Officer has the duty to 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.The Hearing Officer’s decision regarding the assessment or valuation of the property may be based solely upon its inquiry and any evidence presented by the parties, or based solely upon evidence presented by the parties.[12]
Weight to be Given Evidence
The Hearing Officer is not bound by any single formula, rule or method in determining true value in money, but 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.[13]
Trier of Fact
The Hearing Officer as the trier of fact may consider the testimony of an expert witness and give it as much weight and credit as he may deem it entitled to when viewed in connection with all other circumstances.The Hearing Officer is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe all or none of the expert’s testimony and accept it in part or reject it in part.[14]
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.[15]
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.[16]
Opinion Testimony by Experts
An expert’s opinion must be founded upon substantial information, not mere conjecture or speculation, and there must be a rational basis for the opinion.[17]The state tax commission cannot ignore a lack of support in the evidence for adjustments made by the expert witnesses in the application of a particular valuation approach.[18]
The testimony of an expert is to be considered like any other testimony, is to be tried by the same test, and receives just so much weight and credit as the trier of fact may deem it entitled to when viewed in connection with all other circumstances.The hearing officer, as the trier of fact, has the authority to weigh the evidence and is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe all or none of the expert’s testimony and may accept it in part or reject it in part.[19]
If specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert on that subject, by knowledge, skill, experience, training, or education, may testify thereto.
The facts or data upon which an expert bases an opinion or inference may be those perceived by or made known to the expert at or before the hearing and must be of a type reasonably relied upon by experts in the field in forming opinions or inferences upon the subject and must be otherwise reliable, the facts or data need not be admissible in evidence.[20]
Respondent’s Burden of Proof
Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the Board of Equalization, must meet the same burden of proof to present substantial and persuasive evidence of the value advocated as required of the Complainant under the principles established by case law.[21]
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, 2009.[22]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.”[23]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[24]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.[25]
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value.[26]The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.[27]“Where the basis for a test as to the reliability of the testimony is not supported by a statement of facts on which it is based, or the basis of fact does not appear to be sufficient, the testimony should be rejected.”[28]
A taxpayer does not meet his burden if evidence on any essential element of his case leaves the Commission “in the nebulous twilight of speculation, conjecture and surmise.”[29]
DECISION
Respondent’s Evidence Supports Board Value
Respondent presented substantial and persuasive evidence to establish a fair market value as of January 1, 2009, to be $196,000 as more particularly set out in the above Findings of Fact.
Complainant Fails to Present Substantial and Persuasive Evidence
The Complainant had to present substantial and persuasive evidence tending to show that the Board of Equalization’s value was incorrect.Complainant’s appraiser’s flaw was in choosing to focus on the style of the improvements rather than their location when selecting comparable sales.While it is generally true that, all other things being equal, buyers have a preference for true ranch style homes over other styles; that generality can be false in any given area.
Inasmuch as California split style homes in Complainant’s neighborhood were selling for more than ranch style homes in an adjacent county, we must conclude that (1) Complainant’s appraiser picked the wrong comparable neighborhoods because if they was truly comparable neighborhoods, the ranch style homes in the comparable neighborhoods should have sold for more than the California split style homes in the subject neighborhood; or (2) Respondent’s appraiser was correct and home style does not matter; but Complainant’s appraiser still used the wrong neighborhood because his sales reflect a lower price than the California split style homes in the subject neighborhood.
In either event, Complainant’s appraisal report fails to rise to the level of substantial and persuasive evidence sufficient to overcome the presumption in favor of the Board of Equalization.
ORDER
The assessed valuation for the subject property as determined the Board of Equalization forClinton County for the subject tax day is AFFIRMED.
A party may file with the Commission an application for review of this decision within thirty (30) days of the mailing date shown in the Certificate of Service.The application shall contain specific 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. [30]
The Collector of Clinton County, as well as the collectors of all affected political subdivisions therein, shall continue to hold the disputed taxes pending a filing of an Application for Review, unless said taxes have been disbursed pursuant to a court order under the provisions of 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 February 11, 2010.
STATE TAX COMMISSION OFMISSOURI
_____________________________________
Luann Johnson
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 11thday of February, 2010, to:Judith Wistuba, 7285 SW Karen Road, Trimble, MO 64492, Complainant; Bill Burris, Prosecuting Attorney, P.O. Box 285, Plattsburg, MO 64477, Attorney for Respondent; Jerry Howard, Assessor,, P.O. Box 436, Plattsburg, MO 64477; Mary Blanton, Clerk, P.O. Box 245, Plattsburg, MO 64477; Sharon Cockrum, Collector, P.O. Box 282, Plattsburg, MO 64477.
___________________________
Barbara Heller
Legal Coordinator
Contact Information for State Tax Commission:
Missouri – State Tax Commission
P.O. Box 146
301 W. High Street, Room 840
Jefferson City, MO 65102
573-751-2414
573-751-1341 FAX
[3] State ex rel. Horton v. Bourke, 129 S.W.2d 866, 869 (1939); Barth v. Kansas City Elevated Railway Company, 44 S.W. 788, 781 (1898).
[4] Burton v. Moulder, 245 S.W.2d 844, 846 (Mo. 1952); Knorp v. Thompson, 175 S.W.2d 889, 894 (1943); Bushman v. Barlow, 15 S.W.2d 329, 332 (Mo. banc 1929).
[5] State ex rel St. Louis Public Service Company v. Public Service Commission, 291 S.W.2d 95, 97 (Mo. banc 1956).