STATE TAX COMMISSION OF MISSOURI
| PATRICK FELLING, | ) | |
| Complainant, | ) | Appeal No. 19-10801 |
| ) | ||
| ) | Parcel No. 21L220637 | |
| v. | ) | |
| ) | ||
| JAKE ZIMMERMAN, ASSESSOR, | ) | |
| ST. LOUIS COUNTY, MISSOURI, | ) | |
| Respondent. | ) |
DECISION AND ORDER
Patrick Felling (Complainant) appeals the St. Louis County Board of Equalization’s (BOE) decision finding the true value in money (TVM) of the subject property on January 1, 2019, was $190,000, with an assessed value of $36,100. Complainant claims the property is overvalued and proposes a value of $173,410.[1] Complainant did not produce substantial and persuasive evidence establishing overvaluation. The BOE’s decision is affirmed.[2]
The evidentiary hearing was conducted on April 7, 2021, via WebEx. Complainant appeared pro se. Respondent was represented by counsel Steven Robson.
FINDINGS OF FACT
- Subject Property. The subject property is located at 9720 Whitestone Terrace in St. Louis, Missouri. The parcel/locator number is 21L220637.
The subject property consists of a 7,553 square foot lot and a 1,539 square foot single family home that has four bedrooms and two baths. (Ex. 2 at 7.)
- Respondent and BOE. Respondent classified the subject property as residential and determined the TVM on January 1, 2019, was $229,400. The BOE classified the subject property as residential and independently determined the TVM on January 1, 2019, was $190,000.
- Complainant’s Evidence. Complainant asserts the TVM of the subject property on January 1, 2019, was $173,410. Complainant testified in support of his opinion of value and presented the testimony of Kevin Davis, a real estate broker, and Matthew Self, a licensed actuary. Complainant submitted the following exhibits:
| Exhibit | Description | Ruling |
| A | Excel spreadsheet.[3] | Admitted |
| B | Forty pages of St. Louis County real estate information for properties located on Whitestone Terrace. | Admitted |
| C | March 21, 2019, St. Louis Business article With higher property values come higher taxes, says county assessor. | Admitted |
| D | March 28, 2021, email exchange between Complainant and Kevin Davis. | Admitted |
| E | October 27, 2020, Crete Doc $11,527.48 invoice. | Admitted |
| F | September 29, 2020, Crete Doc $5,111.03 invoice. | Admitted |
| G | October 14, 2020, Crete Doc $4,703.56 invoice. | Admitted |
| H | January 20, 2020, Barefoot Carpet $1,833.12 bid. | Admitted |
| I | Photograph of crack on exterior of subject property. | Admitted |
| J | Photograph of exterior of subject property. | Admitted |
| K | Photograph of exterior of subject property. | Admitted |
| L | Photograph of interior of subject property. | Admitted |
| M | Photograph of interior of subject property. | Admitted |
| N | Photograph of interior of subject property. | Admitted |
| O | Photograph of portion of bathtub. | Admitted |
| P | Photograph of portion of kitchen. | Admitted |
| Q | Photograph of portion of kitchen. | Admitted |
| R | Photograph of portion of kitchen. | Admitted |
| S | Higby Remodeling Services, LLC estimates to remodel kitchen, downstairs full bath, and upstairs ¾ bathroom. | Admitted |
| T | Spreadsheet of summary, graphs, formulas, z-score table purportedly based on 2015 through 2019 appraisal data for addresses on Whitestone created by Complainant. | Admitted |
Respondent objected to Exhibits E through H, S, and T. The objection was overruled, and the exhibits were received into evidence to be given the weight deemed appropriate, if any. Exhibits A through D, and I though R were also received into evidence.
- Respondent’s Evidence. Respondent presented the testimony of Steven J. Zahner, a senior appraiser with Respondent, and submitted Exhibit 1, the BOE’s October 4, 2019, Findings and Notice of Decision, and Exhibit 2, Mr. Zahner’s June 9, 2020, restricted appraisal report for the subject property indicating a $200,000 opinion of value as of January 1, 2019.
In Exhibit 2, Mr. Zahner utilized the sales comparison approach to estimate the market value of the subject property from recent sales of three comparable properties. The key property data in Exhibit 1 is as follows:
| Address | Subject Property
9720 Whitestone Terrace |
Comparable 1
1232 Bluestone Terrace |
Comparable 2
9700 Graystone Terrace |
Comparable 3
1234 Bluestone Terrace |
| Proximity to Subject | 0.08 miles NW | 0.11 miles NE | 0.08 miles NW | |
| Sale Price | $200,000 | $221,250 | $226,000 | |
| Date of Sale | 7/26/2016 | 12/17/2018 | 5/16/2016 | |
| Location | Suburban/ Average | Suburban/ Average | Suburban/ Average | Suburban/ Average |
| Site (square feet) | 7,553 | 7,701 | 7,405 | 7,536 |
| Condition | Fair | Average | Average | Above Average |
| Room Count/ Bedroom/ Bath | 8/4/2 | 7/4/1.5 | 7/3/1 | 7/4/1 |
| Gross Living Area (sq. ft.) | 1,539 | 1,239 | 1,400 | 1,239 |
| Basement and Finished | 850 Sq.Ft. | 875 Sq.Ft. | 875 Sq.Ft. | 875 Sq.Ft. |
| Rooms Below Grade | Unfinished | Rec. Room | Unfinished | Rec. Rm, Full Bath |
| Garage/ Carport | 1 Car Det. Garage | None | 1 Car Det. Garage | None |
| Additional Features | Fireplace | None | Fireplace | F/P, 4 Season Room |
| Adjusted Sale Price | $202,500 | $200,750 | $195,500 |
The comparable properties are similar to the subject property with respect to location, actual age, and design. Comparables 1, 2, and 3 differ from the subject property with respect to condition, room count, gross living area, rooms below grade, garage/carport, and additional features; condition, room count, and gross living area; and condition, room count, gross living area, rooms below grade, garage/carport, and additional features, respectively. Exhibit 2 indicates that these differences were adjusted for when determining an opinion of value, and that an adjustment was also made to comparables 1 and 3 due to date of sale.
- Value. The TVM of the subject property on January 1, 2019, was $190,000, with an assessed value of $36,100.
CONCLUSIONS OF LAW
- Assessment and Valuation. Residential real property is assessed at 19% of its TVM as of January 1 of each odd-numbered year. Section 137.115.5(1)(a). “True value in money is the fair market value of the property on the valuation date, and is a function of its highest and best use, which is the use of the property which will produce the greatest return in the reasonably near future.” Snider v. Casino Aztar/Aztar Mo. Gaming Corp., 156 S.W.3d 341, 346 (Mo. banc 2005) (internal quotation omitted). The fair market value is “the price which the property would bring from a willing buyer when offered for sale by a willing seller.” Mo. Baptist Children’s Home v. State Tax Comm’n, 867 S.W.2d 510, 512 (Mo. banc 1993). Determining the TVM is a factual issue for the STC. Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008). The “proper methods of valuation and assessment of property are delegated to the Commission.” Savage v. State Tax Comm’n, 722 S.W.2d 72, 75 (Mo. banc 1986).
“For purposes of levying property taxes, the value of real property is typically determined using one or more of three generally accepted approaches.” Snider, 156 S.W.3d at 346. The three generally accepted approaches are the cost approach, the income approach, and the comparable sales approach. Id. at 346-48; see also St. Louis Cty. v. Sec. Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977). The comparable sales approach “is most appropriate when there is an active market for the type of property at issue such that sufficient data are available to make a comparative analysis.” Snider, 156 S.W.3d at 348. “The comparable sales approach uses prices paid for similar properties in arms-length transactions and adjusts those prices to account for differences between the properties.” Id. at 347-48 (internal quotation omitted). “Comparable sales consist of evidence of sales reasonably related in time and distance and involve land comparable in character.” Id. at 348.
- Evidence. The hearing officer is the finder of fact and determines the credibility and weight of the evidence. Kelly v. Mo. Dep’t of Soc. Servs., Family Support Div., 456 S.W.3d 107, 111 (Mo. App. W.D. 2015). The finder of fact in an administrative hearing determines the credibility and weight of expert testimony. Hornbeck v. Spectra Painting, Inc., 370 S.W.3d 624, 632 (Mo. banc 2012). “It is within the purview of the hearing officer to determine the method of valuation to be adopted in a given case.” Tibbs v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 9 (Mo. App. S.D. 2020). The hearing officer “may 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.” Section 138.430.2.
- Complainant’s Burden of Proof. The taxpayer bears the burden of proof and must show by a preponderance of the evidence that the property was overvalued or misclassified. Westwood P’ship v. Gogarty, 103 S.W.3d 152, 161 (Mo. App. E.D. 2003). The BOE’s valuation is presumptively correct. Tibbs v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 7 (Mo. App. S.D. 2020). The “taxpayer may rebut this presumption by presenting substantial and persuasive evidence that the valuation is erroneous” and must prove “the value that should have been placed on the property.” Id. “Substantial evidence is that evidence which, if true, has probative force upon the issues, and from which the trier of fact can reasonably decide the case on the fact issues.” Savage, 722 S.W.2d at 77 (internal quotation omitted). Evidence is persuasive when it has “sufficient weight and probative value to convince the trier of fact.” Daly v. P.D. George Co., 77 S.W.3d 645, 651 (Mo. App. E.D. 2002); see also White v. Dir. of Revenue, 321 S.W.3d 298, 305 (Mo. banc 2010) (noting the burden of persuasion is the “party’s duty to convince the fact-finder to view the facts in a way that favors that party”).
- Complainant Did Not Prove Overvaluation. Complainant did not produce substantial and persuasive evidence establishing that the BOE’s valuation was erroneous and that his opinion of value was the TVM of the subject property as of January 1, 2019. Although Complainant’s testimony, Mr. Davis’ testimony, and Exhibits I through R established that the subject property has condition issues and is not updated, Complainant’s evidence does not persuasively show that the BOE failed to account for these issues in its valuation of the subject property. Complainant’s witness, Mr. Davis, testified that the $190,000 valuation is high, but this testimony is unpersuasive because it was not supported with objective information and analysis, such as information about sales or listings near the subject property. Exhibit T is unpersuasive because summarized assessment data for properties on the same street where the subject property is located is not the equivalent of a recognized approach to valuing property, specifically the sales comparison approach. On cross-examination, Complainant’s witness, Mr. Self, testified, “I would not directly use this [Exhibit T] as a valuation technique.” (Tr. 47:25-45.)
Respondent, although not required to, presented persuasive evidence in support of the BOE’s value of $190,000. Mr. Zahner testified that he researched comparable sales, found three comparable sales in the immediate area, made adjustments to the comparable properties, and reached a $200,000 opinion of value, which is $10,000 more than the BOE value.
CONCLUSION AND ORDER
The BOE decision is affirmed. The TVM of the subject property as of January 1, 2019, was $190,000, with an assessed value of $36,100.[4]
Application for Review
A party may file with the Commission an application for review of this decision within 30 days of the mailing date set forth in the certificate of service for this decision. The application “shall contain specific detailed grounds upon which it is claimed the decision is erroneous.” Section 138.432. The application must be in writing, and may be mailed to the State Tax Commission, P.O. Box 146, Jefferson City, MO 65102-0146, or emailed to Legal@stc.mo.gov. A copy of the 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.
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.
SO ORDERED November 19, 2021.
Laura A. Storck-Elam
Senior Hearing Officer
State Tax Commission
Certificate of Service
I hereby certify that a copy of the foregoing has been electronically mailed and/or sent by U.S. Mail on November 19, 2021, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
Elaina Mejia
Legal Coordinator
[1] In the Complaint for Review of Assessment, Complainant’s proposed value is $168,360. During the evidentiary hearing, Complainant indicated that his proposed value had changed to $173,410.
[2] Complainant timely filed a complaint for review of assessment. The State Tax Commission (STC) has authority to hear and decide Complainant’s appeal. Mo. Const. art. X, Section 14; section 138.430.1, RSMo 2000. All statutory citations are to RSMo 2000, as amended.
[3] Complainant indicated that because of an issue with Exhibit A, Exhibit A was resubmitted as Exhibit T. (Tr. 6:10-36.)
[4] Missouri operates on a two-year reassessment cycle for valuing real property. See Section 137.115.1. Absent new construction or improvements to a parcel of real property, the assessed value as of January 1 of the odd year remains the assessed value as of January 1 of the following even year. Id.