State Tax Commission of Missouri
|LYLE & PHYLLIS BROWN||)|
|LORI JONES, ASSESSOR||)|
|ATCHISON COUNTY, MISSOURI||)|
DECISION AND ORDER
The assessment made by the Board of Equalization of Atchison County is SET ASIDE. Complainant submitted substantial and persuasive evidence to overcome the presumption of correct valuation by the Atchison County Board of Equalization.
Assessed value in money for the subject property for tax year 2015 and 2016 is set at $86,337 ($454,410 True Market Value) residential.
Complainants appeared by counsel James Rosenbloom.
Respondent appeared by attorney Brett Hurst.
Case heard and decided by Senior Hearing Officer John Treu.
Complainant appeals on the ground of overvaluation the residential valuation of the subject property. The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
FINDINGS OF FACT
- Jurisdiction. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission.
- Evidentiary Hearing. The Evidentiary Hearing was held on August 11, 2016, at the Atchison County Courthouse, Rock Port, Missouri.
- Identification of Subject Property. The subject property is identified by map parcel number or locator number 10-16-09-32-00-000-000203. It is further identified as 103 Speedys Drive, Rock Port Atchison County, Missouri (Complaint for Review and Exhibit A).
- Description of Subject Property. The subject residential property consists of a tract of land of 6.44 acres improved by a single family ranch style home with high end finishes, with a gross living area of 2,810 square feet with a 2,810 square foot finished basement. Amenities include 2 bedrooms above grade and 2 bedrooms below grade, 1 ½ bathrooms above grade and 2 ½ bathrooms below grade, a 3 car garage, a porch, a deck, a patio and a ground source heat pump. The property was built in 2005. (Exhibit A).
- Assessment. The Assessor set a true market value on the subject property at $531,800, residential true market value. The Atchison County Board of Equalization sustained such value (Complaint for Review).
- Complainants’ Evidence. Prior to the Hearing Exhibits A & B were admitted into the record, subject to any objection by Respondent to remove such from the record. No such objection was voiced. Complainants also marked and offered into the record Exhibits C & D. Such were admitted into the record without objection. Exhibits E through G were marked and testified about; however, such were not offered into the evidentiary record. Complainants’ exhibits consisted of:
|Exhibit B||Order Dismissing Appeal|
|Exhibit C||Iowa License of Appraiser|
|Exhibit D||Missouri License of Appraiser|
|Exhibit E||Education and Experience of Appraiser|
|Exhibit F||MLS Sheet Comparable #3|
|Exhibit G||MLS Sheet Comparable #4|
Additionally, Complainant Lyle Brown and Appraiser Sue Florea testified.
- Respondent’s Evidence. Prior to the Hearing Exhibit 1 was admitted into the record, subject to any objection by Complainant to remove such from the record. No such objection was voiced. Such consisted of:
|Exhibit 1||Property Record Card|
Additionally, Respondent testified.
- No Evidence of New Construction or Improvements. There was no evidence of new construction and improvement from January 1, 2015 to January 1, 2016. Therefore the assessed value for 2015 remains the assessed value for 2016. Section 137.115.1, RSMo.
- Order Dismissing Appeal. On April 19, 2016 this appeal was dismissed for Complainants failure to timely file exhibits.
- Order Granting Motion to Set Aside and Reinstate Appeal. On July 5, 2016 an Order was issued Setting Aside and Reinstating the appeal.
- Comparables Adjusted Sale Prices. Four comparables were considered by Complainants’ appraiser to arrive at an opinion of value. Another comparable (comparable #5) was listed by the appraiser but not considered in calculating her opinion of value. The adjusted sales prices of the four comparables that were considered ranged from $425,350 to $454,410.
- Presumption of Correct Assessment Rebutted. Although Complainants’ evidence was substantial and persuasive to rebut the presumption of correct assessment and allow the establishment of the true value in money of the subject property as of January 1, 2015, Complainants appraiser’s ultimate opinion of value was not persuasive. The true market values set by the Atchison County Board of Equalization is SET ASIDE.
- The true market value of the subject property, as of 1/1/15, was $454,410
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. Article X, Section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo.
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. Article X, Sections 4(a) and 4(b), Mo. Const. of 1945. The constitutional mandate is to find the true value in money for the property under appeal. By statute real and tangible personal property are assessed at set percentages of true value in money. Section 137.115.5, RSMo – residential property at 19% of true value in money.
Complainants’ 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, 2015. Hermel, supra. 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.” 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).
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value. 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). The owner’s opinion is without probative value; however, where it is shown to have been based upon improper elements or an improper foundation. 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). “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.” Carmel Energy at 783. 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.” See, Rossman v. G.G.C. Corp. of Missouri, 596 S.W.2d 469, 471 (Mo. App. 1980).
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. St. Louis County v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977); St. Louis County v. STC, 515 S.W.2d 446, 450 (Mo. 1974); Chicago, Burlington & Quincy Railroad Company v. STC, 436 S.W.2d 650 (Mo. 1968).
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. St. Louis County v. Boatmen’s Trust Co., 857 S.W.2d 453, 457 (Mo. App. E.D. 1993); Vincent by Vincent v. Johnson, 833 S.W.2d 859, 865 (Mo. 1992); Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. 1991).
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. Missouri Baptist Children’s Home v. State Tax Commission, 867 S.W.2d 510, 512 (Mo. banc 1993). True value in money is defined in terms of value in exchange and not value in use. 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).
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 a 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:
- Buyer and seller are typically motivated.
- Both parties are well informed and well advised, and both acting in what they consider their own best interests.
- A reasonable time is allowed for exposure in the open market.
- Payment is made in cash or its equivalent.
- Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.
- 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.
Complainants’ Burden of Proof Met
Complainants’ evidence was substantial and persuasive to rebut the presumption of correct assessment and allow the establishment of the true value in money of the subject property as of January 1, 2015. Complainant’s property is very atypical for Atchison County. Complainant’s appraiser had to extend the market area of her search for comparables to sixty (60) miles from the subject to locate a sufficient number of comparables.
Complainant’s appraiser identified five comparables to the subject property. Comparable #5 was not considered by the appraiser in her final opinion of value because she deemed the sale as outdated. Of the other four comparables, the adjusted sales prices of such ranged from $425,350 (Comparable #4) to $454,410 (Comparable #2). Comparable #2 only had net adjustments of 2.3% and gross adjustments of approximately 14.43%, of which approximately 6.45% was due to a $30,000 negative adjustment for quality of construction, for which no market based evidence was offered by Complainant, but which Respondent also did not cross examine the appraiser about. The proximity of such four comparables to the subject property ranged from 34.98 miles (Comparable #2) to 57.76 miles (Comparable #3). The Hearing Officer found comparable #2 to be the most appropriate comparable to establish the true market value of the subject property, despite the lack of market based evidence to support the $30,000 negative adjustment by Complainant’s appraiser. All of the four comparables utilized and the subject property have substantial below grade improvements. However, the subject property and Comparable #2 are the most alike regarding improvements below grade. Therefore, the adjusted sales price of comparable #2 will be deemed the true market value of the subject property.
The true market valuation for the subject property as determined by the Atchison County Board of Equalization is SET ASIDE.
The assessed value for the subject property for tax years 2015 and 2016 is set at $86,337 ($454,410 True Market Value) residential.
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, MO 65102-0146, 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. Section 138.432, RSMo
The Collector of Atchison 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 August 23rd, 2016.
STATE TAX COMMISSION OF MISSOURI
Senior Hearing Officer
Delivery or Notice was made via mail, email, fax, or personally on August 23rd, 2016 to the following Individuals of this Order
James Rosenbloom, Complainants’ Counsel, email@example.com
Lori Jones, Respondent, firstname.lastname@example.org
Brett Hurst, Respondent’s Counsel, email@example.com
Lydia McEvoy, Collector, lmcevoy@Atchisoncogov.com
STATE TAX COMMISSION OF MISSOURI