State Tax Commission of Missouri
LOREN LANDAU,)
)
Complainant,)
)
v.) Appeal (s) Number 09-10623
)and 09-10624
MICHAEL BROOKS, ACTING ASSESSOR,)
ST. LOUIS COUNTY,MISSOURI,)
)
Respondent.)
DECISION AND ORDER
HOLDING
Decisions of the St. Louis County Board of Equalization reducing the assessments made by the Assessor are AFFIRMED.
True value in money for the subject property in Appeal Number 09-10623 for tax years 2009 and 2010 is set at $275,000, commercial assessed value of $88,000.
True value in money for the subject property in Appeal Number 09-10624 for tax years 2009 and 2010 is set at $330,000, commercial assessed value of $105,600.
Complainant appeared pro se.Respondent appeared by Associate County Counselor Edward W. Corrigan.
Case decided by Senior Hearing Officer W. B. Tichenor.
ISSUE
Complainant appeals, on the ground of overvaluation and discrimination, the decisions of the St. Louis County Board of Equalization, which reduced the valuations of the each of the subject properties.The Commission takes these appeals to determine the true value in money for the subject properties on January 1, 2009, and whether there was an intentional plan by the assessing officials to assess the properties under appeal at a ratio greater than thirty-two percent or the average commercial assessment ratio forSt. LouisCountyfor the 2009 – 2010 assessment cycle.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 these appeals is proper.Complainant timely appealed to the State Tax Commission from the decision of the St. Louis County Board of Equalization.The appeals were submitted on documents filed by Complainant.No hearing was held.[1]
2.Assessment.The Assessor appraised the property in Appeal 09-10623 at $371,400, a commercial assessment of $118,850.The Board reduced the value to $275,000, a commercial assessment of $88,000.
The Assessor appraised the property in Appeal 09-10624 at $431,400, a commercial assessment of $138,050.The Board reduced the value to $330,000, a commercial assessment of $105,600.
3.Subject Properties.The subject property in Appeal 09-10623 is located at3535 N. Lindbergh Blvd.,St. Ann,Missouri.The property is identified by locator number 13M440644.
The subject property in Appeal 09-10624 is located at3541 N. Lindbergh Blvd.,St. Ann,Missouri.The property is identified by locator number 13M440828.
4. Complainant’s Evidence.Complainant filed with the Commission the following exhibits in the two appeals.[2]
|
EXHIBIT |
DESCRIPTION |
|
A |
Handwritten Statement of Mr. Landau, dated 10/8/10 |
|
B |
Bid for Asphalt work dated 8/23/07 |
|
C |
History of Insurance Premiums, dated 10/8/10 |
|
D |
Roofing Bid for 3541 N. Lindbergh, dated 7/22/08 |
|
E |
Roofing Bid for 3535 N. Lindbergh, dated 7/22/08 |
|
F |
Handwritten Statement of Mr. Landau, dated 11/22/10 |
|
G |
Hand drawn Map of N. Lindbergh Subject Area |
|
H |
Sales Data Sheets on 3 properties/Listing Data Sheet on 1 property |
|
I |
47 Photographs of ForSaleand For Lease Properties in Subject Area |
There was no evidence of new construction and improvement from January 1, 2009, to January 1, 2010, therefore the assessed value for 2009 remains the assessed value for 2010.[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, 2009, to be $200,000 for each of the properties being appealed.
5.Respondent’s Evidence.Respondent elected to not present any evidence and simply rested upon the presumption of correct assessment by the Board.
CONCLUSIONS OF LAW AND DECISION
Jurisdiction
The Commission has jurisdiction to hear these appeals 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.[4]
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.[5]The constitutional mandate is to find the true value in money for the property under appeal. By statute real and tangible personal property is assessed at set percentages of true value in money.[6]In an overvaluation appeal, true value in money for the property being appealed must be determined based upon the evidence on the record that is probative on the issue of the fair market value of the property under appeal.The evidence presented by Complainant did not provide a basis for a conclusion of true value in money for the two subject properties.
Presumption In Appeals
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.[7]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.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.[8]Complainant did not provide evidence to rebut the presumption of correct assessment by the Board.The values set by the Board must accordingly be affirmed.
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]True value in money is defined in terms of value in exchange and not value in use.[10]It is the fair market value of the subject property on the valuation date.[11]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.[12]
Complainant’s exhibits did not comply with the Standard For Valuation to provide evidence of what a willing buyer and seller would have agreed to as the purchase price of the properties under appeal as of January 1, 2009.
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.[13]Missouri courts have approved the comparable sales or market approach, the cost approach and the income approach as recognized methods of arriving at fair market value.[14]Complainant did not present conclusions of value that were derived from any accepted appraisal methodology.Therefore, the opinions provided were not based on a proper method for the valuation and assessment of property.
Complainant Fails To Prove Value
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.[15]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.”[16]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[17]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.[18]
Exhibits Not Relevant
The exhibits and written statements provided by Mr. Landau provided no evidence relevant to establishing the true value in money of the two properties as of January 1, 2009.
Exhibits A & F – Complainant’s Written Statements
These two exhibits were received as the testimony of the taxpayer.These documents fail to provide relevant testimony to establish the fair market value of the properties under appeal as of January 1, 2009.The statements fail to provide sufficient explanation of the other documents presented with Exhibits A and F to establish the foundation for the other exhibits.The statements provide no opinion of value based upon either a sales comparison, income or cost appraisal analysis.In short, there is no probative evidence to be gleaned from Exhibit A and F.
Exhibits B, D & E – Asphalt & Roofing Bids
Bids for repair work on a company letterhead, notwithstanding their inherent hearsay content, are generally accepted into evidence to provide information as to cost to cure items of maintenance or repair.Such bids are generally the best evidence that a taxpayer can reasonably be expected provide on such matters in a hearing before the Commission.Be that as it may, a bid only provides a limited degree of relevant information.That information, however, does not establish what a willing buyer and seller would have agreed to as the purchase price on the given property.The benefit of such bids is generally only realized as a tool in an appraisal methodology to address adjustments in a sales comparison approach.A bid standing alone is not probative on the issue of true value in money.
Exhibit C – Insurance Premiums
The past history of insurance premiums on a property is totally irrelevant to the issue of fair market value.There is no recognized appraisal methodology that takes into account what past or present insurance premiums on a property happened to be.This exhibit provided nothing of material benefit in the instant appeals.
Exhibit G – Area Map
The map of the subject area prepared by Mr. Landau provided nothing of merit as to what the market values in the area on properties similar to the subjects might be.Appraisers routinely provide locator maps to establish proximity of the subject to both sale and rental comparables.Locator maps establish that sales or lease properties used for comparison purposes are in the same market area as the property being appraised.However, an area map in and of itself has no probative value on the issue of the valuation of a given property.
Exhibit H – Sales and Listing Data Sheets
Sales and listing data sheets are hearsay.Appraisers may rely upon the information in such sources for the preparation of an appraisal.They are a source of information that can then be verified through contacts with the sale or listing broker/agent.However, owners may not testify as to comparable properties without being qualified as an expert in the field of appraisal.In this case, Mr. Landau is not qualified as an expert in the valuation of real property.There was not a foundation laid as to how any of the tendered information would establish true value in money for the properties under appeal.Therefore, the information contained in this exhibit has no probative value.
Exhibit H – Photographs
In Commission appeals one picture may be worth a thousand words.However, photographs, unless tied to an appraisal of the property being valued, are not worth the paper on which they are printed.The Hearing Officer understands that the taxpayer wished to visually demonstrate all of the properties within a few blocks of the subject that are listed for sale or lease.The photographs depict such properties.The flaw is that none of the photographs establish the value of any one of the properties shown, let alone the value of either of the taxpayer’s properties.The photographic problem is always – the picture doesn’t establish value.Accordingly, the Exhibit provides nothing relevant to prove the value which Mr. Landau proffered for each of his properties.
Conclusion
None of the exhibits provided relevant information that would provide a basis for finding the true value in money of the subject properties.
Owner’s Opinion Not Persuasive
The owner of property is generally held competent to testify to its reasonable market value.[19]The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.[20]Mr. Landau provided his opinion of value for each of the properties in the Complaints for Review of Assessment.However, no evidence was presented to support his opinions of value based on any recognized appraisal methodology.As just addressed, none of the exhibits submitted, or the written statements of the taxpayer, presented relevant information to prove value.Therefore, there was not a proper foundation for the owner’s opinions.The opinions of value of Mr. Landau were not based upon elements which are accepted by the Commission for a determination of true value in money.Accordingly, the opinions of value tendered on the Complaints can be given no probative weight.Complainant failed to meet his burden of proof.
Complainant Fails To Prove Discrimination
In order to obtain a reduction in assessed value based upon discrimination, the Complainant must (1) prove the true value in money of the subject property on January 1, 2009; and (2) show an intentional plan of discrimination by the assessing officials resulting in an assessment of that property at a greater percentage of value than other property, generally, within the same class within the same taxing jurisdiction.[21]Evidence of value and assessments of a few properties does not prove discrimination.Substantial evidence must show that all other property in the same class, generally, is actually undervalued.[22]The difference in the assessment ratio of the subject property the average assessment ratio in the subject county must be shown to be grossly excessive.[23]No other methodology is sufficient to establish discrimination.[24]
Complainant presented no evidence upon which a claim of discrimination could be sustained.Complainant failed to prove the fair market value of the two properties under appeal and failed to present any evidence to establish that the properties under appeal were being assessed at a percentage of value greater than other commercial property inSt. LouisCountyfor the 2009 – 2010 assessment.
Conclusion
The Complainant having failed to present substantial and persuasive evidence to rebut the presumption of correct assessment by the Board, to establish the true value in money for each property as of January 1, 2009, and to establish a claim of discrimination, the Board’s assessment must be affirmed.
ORDER
The assessed valuations for the subject properties as determined by the Board of Equalization forSt. LouisCountyfor the subject tax day are AFFIRMED.
The assessed value for the subject property in appeal 09-10623 for tax years 2009 and 2010 is set at $88,000.
The assessed value for the subject property in appeal 09-10624 for tax years 2009 and 2010 is set at $105,600.
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.
Failure to state specific facts or law upon which the application for review is based will result in summary denial. [25]
Disputed Taxes
The Collector of St. Louis 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 February 15, 2011.
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 15thday of February, 2011, to:Loren Landau, 365 Lyonnais, St. Louis, MO 63141, Complainant; Edward Corrigan, Associate County Counselor, County Government Center, 41 South Central Avenue, Clayton, MO 63105, Attorney for Respondent; Michael Brooks, ActingAssessor, County Government Center, 41 South Central Avenue, Clayton, MO 63105; John Friganza, Collector, County Government Center, 41 South Central Avenue, Clayton, MO 63105.
___________________________
Barbara Heller
Legal Coordinator
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
573-751-2414
573-751-1341 Fax
[1] Upon review of Complainant’s exhibits and written testimony, the Hearing Officer concluded that Complainant failed to make a prima facie case and that no hearing was warranted.
[2] Complainant failed to comply with the Commission Order of 10/18/10 and mark exhibits for identification by letters.Therefore, the Hearing Officer has marked the exhibits with identifying letters.
[7] 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)
[8] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959)
[9] 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).
[10] 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).
[12] 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.
[13] See, Nance v. STC, 18 S.W.3d 611, at 615 (Mo. App. W.D. 2000); Hermel, supra;Xerox Corp. v. STC, 529 S.W.2d 413 (Mo. banc 1975).
[14] 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).
[16] 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).
[19] Rigali v. Kensington Place Homeowners’ Ass’n, 103 S.W.3d 839, 846 (Mo. App. E.D. 2003); Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970).
[20] Cohen v. Bushmeyer, 251 S.W.3d 345, (Mo. App. E.D., March 25, 2008); Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992); State, ex rel. Missouri Hwy & Transp. Com’n v. Pracht, 801 S.W.2d 90, 94 (Mo. App. E.D. 1990); Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965).