State Tax Commission of Missouri
MARVIN W. JEFFERS,)
)
Complainant,)
)
v.) Appeal No.09-34035
)
RANDY HOLMAN, ASSESSOR,)
JEFFERSON COUNTY, MISSOURI,)
)
Respondent.)
DECISION AND ORDER
HOLDING
Decision of the Jefferson County Board of Equalization sustaining the assessment made by the Assessor is AFFIRMED.Hearing Officer finds Complainant did not rebut the presumption of correct assessment by the Board. True value in money for the subject property for tax years 2009 and 2010 is set at $222,800, residential assessed value of $42,300.
Evidentiary hearing was held on December 1, 2009, at the Jefferson County Government Center, Hillsboro, Missouri.
Complainant appeared pro se.
Respondent appeared by counsel, David Senkel.
Case heard and decided by Hearing Officer Maureen Monaghan.
ISSUE
The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2009, and whether there was an intentional plan of the assessing officials
to assess the property at a value greater than 19% of fair market value or at a greater percentage than the average residential assessment in Jefferson County.
SUMMARY
Complainant appeals, on the ground of overvaluation and discrimination, the decision of the Jefferson County Board of Equalization, which sustained the valuation of the subject property.The Assessor determined an appraised value of $222,800 (assessed value of $42,300, as residential property).Complainant proposed a value of $200,000 (assessed value of $38,000).A hearing was conducted on December 1, 2009, at the Jefferson County Government Center, Hillsboro, Missouri.
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 Jefferson County Board of Equalization.
2.Subject Property.The subject property is located at 605 Alsace, Pevely, Missouri.The property is identified by parcel number 1.0-3.0-07.0-183.The property consists of 13,800 square foot lot improved by a one-story brick and siding, ranch, single-family structure of average quality construction.The house was built in 2008 and appears to be in average condition.The residence has a total of 6 rooms, which includes 3 bedrooms, 2 baths, and contains 1,840 square feet of living area.There is a full, unfinished basement and an attached three-car garage. The property was purchased by the Complainant in April, 2008 for $235,000. There was no evidence of new construction and improvement since January 1, 2009.
3.Complainant’s Evidence.Complainant testified on his own behalf and presented the following exhibits:
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Exhibit A |
List of Sales |
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Exhibit B |
List of Properties from Assessor’s Office |
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Exhibit C |
Analysis of Subject Property’s Assessment |
Complainant testified regarding Exhibit A.Exhibit A is a list of 18 properties.The properties are located in the subdivision next to the subject parcel’s subdivision.He testified that the subdivision is older than his subdivision and offered different amenities.The chart lists the true value of the property as determined by the Assessor’s Office for the 2009 assessment cycle and the sale price of the property.The Complainant subtracted the sale price from the Assessor’s true value for 2009.The Complainant determined the percentage of Assessor’s true value to sale price.He listed the square footage of the property, the price per square foot, and the size of the lot.No other comparisons or adjustments were made.In Exhibit B, the Complainant listed eight properties with the information provided by the Assessor’s Office.The information includes the Assessor’s true value for the 2009 assessment cycle, the square footage of each property and the price per square foot.The price per square footage for the listed properties ranged from $107.59 to $118.91 per square foot.The Complainant’s price per square foot based upon the value determined by the Assessor for the 2009 assessment cycle of $123.21.Complainant testified that the 18 properties from Exhibit A and the 8 properties from Exhibit B show discrimination by the Assessor’s Office.
4.Respondent’s Evidence.The Respondent presented the testimony of Joseph Berezowski, Certified Residential Appraiser, and Exhibit 1, his appraisal report on the subject property.The properties relied upon by Respondent’s appraiser in performing his appraisal were comparable to the subject property for the purpose of making a determination of value of the subject property. The properties were located within 1 mile of the subject; the properties were in the same development and were within 13 lots of each other.Each sale property sold at a time relevant to the tax date of January 1, 2009.The sale properties were similar to the subject in style, quality of construction, age, condition, room, bedroom and bathroom count, living area, location, site size and other amenities of comparability.
The comparables were described as follows:
Comparable 1 sold in October, 2008 for $280,300.It is located next door to the subject property.This property consists of a 17,424 square foot lot improved by a one-story brick single-family structure of average quality construction.The house was built in 2008 and appears to be in average condition.The residence has a total of 6 rooms, which includes 3 bedrooms, 2 baths, and contains 1,895 square feet of living area.There is a full basement and a three car attached garage.
Comparable 2 sold in December, 2008 for $265,000.It is three lots from the subject property. This property consists of a 13,939 square foot lot improved by a one-story brick single-family structure of average quality construction.The house was built in 2008 and appears to be in average condition.The residence has a total of 6 rooms, which includes 3 bedrooms, 2 baths, and contains 1,842 square feet of living area.There is a full basement and an attached three car garage.
Comparable 3 sold in August, 2008 for $228,000.This property consists of a 13,068 square foot lot improved by a one-story brick single-family structure of average quality construction.The house was built in 2008 and appears to be in average condition.The residence
has a total of 6 rooms, which includes 3 bedrooms, 2 baths, and contains 1,858 square feet of living area.There is a full basement and an attached three car garage.
The appraiser made various adjustments to the comparable properties for differences which existed between the subject and each comparable.The appraiser made adjustments for time of sale, age, and fireplaces.All adjustments appear to be appropriate to bring the comparables in line with the subject for purposes of the appraisal problem.
The net adjustments for Comparable 1 amounted to -$2,900 or -1.04% of the sales price.The net adjustments for Comparable 2 amounted to -$2,300 or -.87% of the sales price.The net adjustments for Comparable 3 amounted to -$2,300 or -1.01% of the sales price.
The adjusted sales prices for the comparables calculated to $277,400, $262,700, and $225,700, respectively.The appraiser concluded on a $255,000 value which calculated to a value per square foot of $138.59 compared with the sales prices per square foot of living area for the comparables of $147.92, $143.87 and $122.71. The comparison of the value per square foot provides a validation check for the appraisal, to demonstrate that the indicated value is consistent with the market for properties such as the subject.
Respondent’s appraisal was accepted only to sustain the original assessment made by the Assessor and not for the purpose of raising the assessment above that value.
5.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, as proposed.
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]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]
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
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.[17]
Complainants’ Burden of Proof
In order to prevail, Complainants 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.[18]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.”[19]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[20]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.[21]
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value.[22]The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.[23]“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.”[24]
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.”[25]
Sale of Subject
Evidence of the actual sales price of property is admissible to establish value at the time of an assessment, provided that such evidence involves a voluntary purchase not too remote in time.The actual sale price is a method that may be considered for estimating true value.The actual sales price, between a willing seller who is not obligated to sell and a willing buyer who is not compelled to buy, establishes an outer limit on the value of real property.[26]
Discrimination
In order to obtain a reduction in assessed value based upon discrimination, the Complainants must (1) prove the true value in money of their 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.[27]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.[28]The difference in the assessment ratio of the subject property and the average assessment ratio in the subject county must be shown to be grossly excessive.[29]No other methodology is sufficient to establish discrimination.[30]
Complainant Fails To Prove Discrimination
Where there is a claim of discrimination based upon a lack of valuation consistency, Complainants have the burden to prove the level of assessment for the subject property in 2009. Complainants must prove the average level of assessment for residential property in Jefferson County for 2009.This is done by (a) independently determining the market value of a representative sample of residential properties in Jefferson County; (b) determining the assessed value placed on the property by the assessor’s office for the relevant year; (c) dividing the assessed value by the market value to determine the level of assessment for each property in the sample; and (d) determining the mean and median of the results.
The difference between the actual assessment level of the subject property and the average level of assessment for all residential property, taken from a sufficient representative sample in Jefferson County must demonstrate a disparity that is grossly excessive.[31]
Complainant’s discrimination claim fails because they have not demonstrated that a statistically significant number of other residential properties within Jefferson County are being assessed at a lower ratio of market value than their property.Complainants’ claim of discrimination is based upon 26 properties and their valuation as determined by the Assessor.The Complainant did not provide the independently determined market value for the 26 properties.The Complainant did not compare the independently determined market value with the Assessor’s value.The Complainant’s use of sale price is not sufficient as the sales were not verified, the date of sale is unknown, and adjustments for times based upon market data were not made.
Because Complainant did not establish the market value of their property was $200,000 and has failed to establish that he is being assessed at a higher percentage of market value than a statistically significant number of other properties in Jefferson County, he has failed to establish either overvaluation or discrimination.
ORDER
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for Jefferson County for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax year 2009 is set at $42,300.
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 appeal is based will result in summary denial. [32]
The Collector of Jefferson 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 December 22, 2009.
STATE TAX COMMISSION OFMISSOURI
_____________________________________
Maureen Monaghan
Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 22ndday of December, 2009, to:Marvin Jeffers, 605 Alsace, Pevely, MO 63070, Complainant; David Senkel, One Thurman Court, P.O. Box 800, Hillsboro, MO 63050, Attorney for Respondent; Randy Holman, Assessor; Wes Wagner, Clerk; Beth Mahn, Collector, Jefferson County Courthouse, Hillsboro, MO 63050.
___________________________
Barbara Heller
Legal Coordinator
[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).
[6] In re Murphy, 732 S.W.2d 895, 902 (Mo. banc 1987); State v. Gilmore, 681 S.W.2d 934, 940 (Mo. banc 1984); State v. Keeble, 399 S.W.2d 118, 122 (Mo. 1966).
[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 SW3d 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] 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).
[14] 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); Curnow v. Sloan, 625 S.W.2d 605, 607 (Mo. banc 1981).
[15] 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).
[16] 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).
[17] Section 490.065, RSMo; State Board of Registration for the Healing Arts v. McDonagh, 123 S.W.3d 146 (Mo. SC. 2004); Courtroom Handbook on Missouri Evidence, Wm. A. Schroeder, Sections 702-505, pp. 325-350; Wulfing v. Kansas City Southern Industries, Inc., 842 S.W.2d 133 (Mo. App. E.D. 1992).
[19] 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).
[22] 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).
[23] 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).