STATE TAX COMMISSION OF MISSOURI
|MICHAEL AND TERRI WORKES,||)|
|JAKE ZIMMERMAN, ASSESSOR||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
DECISION AND ORDER
Workes (Complainants) appeal the decision of the St. Louis County Board of Equalization (BOE) determining the appraised value of the subject property was $283,400 as of January 1, 2019. Complainants contend that the BOE overvalued the residential property and propose an appraised value of $276,000. Because Complainants did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE and to establish the true value in money of the property as of January 1, 2019, the decision of the BOE is AFFIRMED.
Complainants requested to dispense with an oral evidentiary hearing and for the appeal to be decided upon exhibits and other evidence. Jake Zimmerman, Assessor, St. Louis County, Missouri (Respondent), through counsel, consented to such request. A deadline for the submission of exhibits was set. Complainants, proceeding pro se, timely submitted documents and exhibits for consideration. Respondent, by Assistant County Counselor Monique McNutt, timely submitted written direct testimony and exhibits.
FINDINGS OF FACT
1. Authority. Complainants timely appealed from the BOE to the State Tax Commission.
2. Subject Property. The subject property is identified by parcel/locator number 28H611422 and further identified by mail address 637 Vista Conn Dr., St. Louis, MO 63125. The subject property consists of a 0.154 acre site improved by a 1,564 square foot ranch house built in 2017. The house includes three bedrooms, two full baths, a full basement, an attached two-car garage, and an aluminum/vinyl exterior. Respondent assigned the house a construction grade of B- and a Condition, Desirability, Utility (CDU) rating of AV.
3. Assessment. Respondent initially appraised the subject property at $283,400 as of January 1, 2019, and classified the property as residential.
4. Board of Equalization. The BOE sustained Respondent’s determination and valued the property at $283,400.
5. Complainants’ Evidence. In support of a proposed value of $276,000, Complainants submitted a document entitled “Transcript” explaining the basis for the appeal; a “Closing statement” discussing the renovation and building of new homes that accommodate older adults and people with disabilities; and two exhibits.
Complainants’ Exhibit 1, titled “Extra cost for Disable Needs; 637 Vista Conn, 63125,” is a list of additional costs Complainants indicate they incurred when they purchased the home and six photographs. Exhibit 1 lists 11 items, including 36-inch doorways; a 36-inch garage door entry; an architectural fee; bathroom grab bars; and other items, with an associated cost for each item and a total cost of $9,155. Exhibit 1 also includes photographs of what appears to be some of the listed items.
Complainants’ Exhibit 2 is a photograph of a sign that states the starting price of homes located in the VistaConn subdivision. The sign indicates detached villas are from the “$200’s” and single family homes are from the “$230’s.”
In the document titled “Transcript,” Complainants assert that the subject property is overvalued based on three general reasons. First, Complainants argue that, despite the fact that no updates have been made to the property after purchase, the 2019 appraised value is $7,400 more than the 2018 appraised value. Second, Complainants indicate that when they purchased the property on December 1, 2017, they paid a higher purchase price due to physical modifications needed and detailed in Complainants’ Exhibit 1. Third, Complainants state that the base price of the subject property was $250,000 when purchased, but a new builder dropped the base price to $230,000 as indicated in Complainants’ Exhibit 2.
6. Respondent’s Evidence. Respondent argues that the true value in money of the subject property as of January 1, 2019, is $307,000 and requests that the BOE’s value of $283,400 be upheld. To support this opinion of value, Respondent submitted the Written Direct Testimony of Senior Residential Appraiser Adam Luesse and two exhibits.
Respondent’s Exhibit 1 is the BOE’s Findings and Notice of Decision dated October 4, 2019. In Exhibit 1, the BOE determined the appraised value of the property to be $283,400.
Respondent’s Exhibit 2 is a Restricted Appraisal Report by Adam Luesse that includes a Subject Property Summary on page 3; Photos of Subject on page 4; Comparable 1 Story Sales from Subject Subdivision on pages 5 and 6; a Property Sketch Image: 28H611422 – 2020 – Card 1 on page 7; a Real Property Certificate of Value on pages 8 and 9; and a list of Mr. Luesse’s education, training, and real estate experience on page 10. According to the Real Property Certificate of Value, Complainants paid $320,409 for the newly constructed residential property, and the date of occupancy was December 1, 2017.
In Exhibit 2, Mr. Luesse determined a valuation result of $307,000 using the sales comparison approach and a valuation of $306,000 using the cost approach. He opined “the best indicator of value for single-unit residential properties in this market” was the sales comparison approach and used nine ranch comparables from the subject subdivision that sold in 2017 and 2018, with an average sales price of $298,953 and a median sales price of $312,930. Mr. Luesse applied the average per square foot price of $196.68 to the square footage of the property (1,564) to determine a value of $307,607. Mr. Luesse opined the sale price of $320,409, the average and median comparable prices, and the average per square foot price support his “estimated market value of $307,000.”
7. Value. The true value in money of the subject property is $283,400.
CONCLUSIONS OF LAW
1. State Tax Commission Authority. The Commission has authority to hear this appeal. The Commission has authority “to hear appeals from local boards in individual cases” and “to correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious.” Mo. Const. art. X, § 14. A hearing officer appointed by the Commission “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 138.431.5.
2. Assessment. The Constitution mandates the assessment of real property and tangible personal property “at its value or such percentage of its value as may be fixed by law for each class and for each subclass.” Mo. Const. art. X, §§ 4(a)-4(b). Residential, agricultural, and commercial property are assessed at 19%, 12% and 32% of true value in money, respectively. Sections 137.016, 137.115.5. “True value in money is the price which the property would bring from a willing buyer when offered for sale by a willing seller.” Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. 2008). Further, “[a] willing seller is one who is not obligated to sell and a willing buyer is one who is not obligated to buy.” Id. The true value in money “is the fair market value of the property on the valuation date.” Mo. Baptist Children’s Home v. State Tax Comm’n, 867 S.W.2d 510, 512 (Mo. banc 1993). The value as of January 1st of the odd numbered year remains the value for the following even numbered year unless there is new construction or improvement to the property. Section 137.115.1.
3. Complainants’ Burden of Proof. Taxpayers “seeking affirmative relief” bear “the burden of proving the vital elements of their case.” Reeves v. Snider, 115 S.W.3d 375, 379 (Mo. App. 2003). A taxpayer challenging an assessment “bears the burden of proof and must show by a preponderance of the evidence that the property was improperly classified or valued.” Westwood P’ship v. Gogarty, 103 S.W.3d 152, 161 (Mo. App. 2003). “A county board of equalization’s valuation is presumed correct,” and such presumption “may be rebutted only if the taxpayer presents substantial and persuasive evidence that the valuation is erroneous.” Parker v. Doe Run Co., 553 S.W.3d 356, 360 (Mo. App. 2018). Substantial evidence is “relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Daly v. P.D. George Co., 77 S.W.3d 645, 651 (Mo. App. 2002). Persuasive evidence “has sufficient weight and probative value to convince the trier of fact.” Id. “The taxpayer has the burden to establish the value that should have been placed on the property.” Parker, 553 S.W.3d at 360.
4. Weight of Evidence. “In determining a tax assessment the commission is not bound by any single formula, rule of method, but is free to consider all pertinent facts and estimates and give them such weight as reasonably they may be deemed entitled to.” St. Louis Cty. v. State Tax Comm’n, 515 S.W.2d 446, 450 (Mo. 1974). Expert testimony, like other testimony, is to “receive just so much weight and credit as the jury (or judge) may deem it entitled to when viewed in connection with all other circumstances.” Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. 1991).
5. Methods of Valuation. “Proper methods of valuation and assessment of property are delegated to the Commission.” Nance v. State Tax Comm’n, 18 S.W.3d 611, 615 (Mo. App. 2000). “It is within the purview of the hearing officer to determine the method of valuation to be adopted in a given case.” Drury Chesterfield Inc. v. Muehlheausler, 347 S.W.3d 107, 112 (Mo. App. 2011). “Missouri courts have approved the comparable sales or market approach, the cost approach (replacement or construction) and the income approach as recognized methods of arriving at fair market value.” Id.
6. Overvaluation Not Proven. Complainants do not present substantial and persuasive evidence to rebut the presumption of correct valuation by the BOE. Complainants’ proposed valuation of $276,000 appears to be based on Respondent’s 2018 appraised value of the subject property for such amount. Although Complainants question the increase in the appraised value of the property from the sum of $276,000 in 2018 to the sum of $283,400 in 2019, Complainants do not produce any evidence that shows $276,000 is the true value in money for the property as of January 1, 2019. Complainants do not offer any accepted method of valuation in support of their proposed value. Further, in December of 2017, only thirteen months before the valuation date of January 1, 2019, Complainants purchased the property for $320,409 (Resp’t Ex. 2, 8.). This purchase price is $37,009 more than the $283,400 appraised value of the property determined by the BOE as of January 1, 2019.
In an attachment to the Complaint for Review of Assessment, Complainants contend that “the paid value of this home is due to the extra items required due to health reasons” and was not due to “upgrade for granite etc.” The total of the additional costs listed in Complainants’ Exhibit 1, $9,155, added to the purported base price of the property, $250,000, results in the sum of $259,155, which is $61,254 less than the price Complainants paid to purchase the property, $320,409. The additional amount that was paid above the $259,155 is not explained in Complainants’ evidence. Regardless, based on the $320,409 purchase price of the property, it is reasonable to assume that additional upgrades or modifications increased the cost of the property by $61,254 to $320,409. While Complainants’ Exhibit 1 may explain part of the increase in the cost of the property above the purported base price when the property was purchased, such exhibit does not address the true value in money of the property as of January 1, 2019.
Similarly, while Complainants’ Exhibit 2 appears to show that, at the time the photograph was taken, single family homes in the VistaConn subdivision were advertised as available from the “$230’s,” Complainants have not shown the impact, if any, that this advertised base price has on the true value in money of Complainants’ property as of January 1, 2019.
The determination of the BOE is AFFIRMED. The appraised value for the subject property is $283,400 as of January 1, 2019.
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, or emailed to Legal@stc.mo.gov, and a copy of said application must be sent to each person 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.
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.
SO ORDERED September 18, 2020.
STATE TAX COMMISSION OF MISSOURI
Laura A. Storck-Elam
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 18th day of September, 2020, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent, and the County Collector.