Paul Mittelstadt v. Bushmeyer (SLCY)

April 6th, 2010

State Tax Commission of Missouri





v.) Appeal No.09-20171









Decision of the St. Louis City Board of Equalization sustaining the assessment made by the Assessor is AFFIRMED.True value in money for the subject property for tax years 2009 and 2010 is set at $601,600, residential assessed value of $114,300.Complainant appeared pro se.Respondent appeared by Associate City Counselor, Carl W. Yates, III.

Case heard and decided by Senior Hearing Officer W. B. Tichenor.


Complainant appeals on the ground of overvaluation.The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2009.The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.


1.Jurisdiction.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the decision of the St. Louis City Board of Equalization.A hearing was conducted on February 18, 2009, in the Assessor’s Conference Room, City Hall, St. Louis, Missouri.[1]

2.Assessment.The Assessor valued the property at $601,600, residential assessed value of $114,300.The Board of Equalization sustained the Assessor’s assessment.

3.Subject Property.The subject property is located at 21 Maryland Plaza # E, St. Louis, Missouri.The property is identified by map parcel number 3881-00-0174-0.The property consists of one unit of a two and one-half story brick two-family condominium built in 1906.It has 2,726 square feet of living area.[2]The home has six rooms including two bedrooms.There are two and one-half baths.The condo has a two-car detached garage on the rear of its lot in a two-story building with other garages and second floor studio condominiums.The subject is one of twenty condominiums that make up Maryland Place.Maryland Place is a renovation project that includes seven buildings that were formerly single family homes.The subject’s renovation was completed in 2005.[3]Complainant purchased it at that time for $689,000.[4]

4.Complainant’s Evidence.Complainant testified in his own behalf and gave his opinion of the fair market value of the property as of January 1, 2009, to be $419,800 based information, calculations and conclusions contained in Exhibit A.[5]Objection was made to Exhibit A, which was sustained.See, Ruling on Objection to Exhibit A, infra.Complainant offered into evidence the appraisal of the property by Thomas R. Noonan, valuing the property as of November 21, 2009.[6]

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.[7]Exhibit B provided substantial and persuasive evidence to rebut the presumption of correct assessment by the Board and a basis for the Hearing Officer to determine true value in money.

5.Respondent’s Evidence.Respondent presented the testimony of Tim Keller, appraiser for the St. Louis City Assessor and Mr. Keller’s appraisal of the subject property.[8] Mr. Keller gave his opinion of value for the property under appeal as of January 1, 2009, to be $601,600.



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.[9]

Presumption In Appeals

There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.[10]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 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.[11]Complainant’s evidence failed to meet the required standard to rebut the presumption of correct assessment by the Board.

Ruling on Objection to Exhibit A

Counsel for Respondent objected to Exhibit A on the grounds of hearsay, lack of foundation and speculation.Objection was sustained.Exhibit A was excluded from the evidentiary record.The Exhibit is maintained in the Appeal file, but is not considered as evidence upon which a decision as to the true value in money of the subject can be based.

Housing Market Information

Mr. Mittelstadt wished to introduce three documents related to the current housing market.The three documents contained in Exhibit A were: (1) copy of the Case-Shiller 100-Year History of Home Values Chart; (2) – St. Louis Home Prices Falling Faster than U.S.; and (3) Case-Shiller Housing Index, December 2008.Taxpayers often are very fond of wanting to present newspaper, Internet or professional journal articles that provide statistical data relative to home values.Such information may be interesting and probative as to general trends, but it is not probative as to what a single property would have sold for on the valuation date for an ad valorem tax appeal.The reasoning of the taxpayer is that based on national, state or regional trends that housing values have been in a decline.Therefore, the value of the taxpayer’s property must have declined from the 2007-08 assessment to the 2009 assessment.

The first defect in this reasoning is that it assumes a critical fact that has not been established, i.e. that the property under appeal was valued in the 2007-08 assessment cycle at fair market value as of January 1, 2007.All of the charts, graphs, studies and conclusions regarding the housing market from 2007 up to 2009 do not establish that the value place on the property as of January 1, 2007, by the Assessor was in fact its true value in money.

The second critical aspect of this faulty line of reasoning is to assume another critical, but unproven fact, i.e., that some percentage decline in the overall housing market is applicable to the property under appeal.In other words, what taxpayers seek to establish from general trends of decline in value is that such and such an average is applicable to their given property.The existence of an average percentage decline in home values does nothing to prove that the subject has declined by that percentage.

In short, reliance on such information as contained in the three documents Mr. Mittelstadt sought to offer in Exhibit A seeks to establish an opinion of value relying upon two fatally flawed speculations.As such, the documents have no probative value and therefore lack relevance on the issue of fair market value of Complainant’s property as of January 1, 2009.

Multi-List System Data Sheets

Another source of information which is often tendered by taxpayers is either listing or sold information sheets from MLS sources.It is true that such documents are a source of information often relied upon by appraisers as part of their market research.Appraisers as experts in appraisal are permitted to rely upon such hearsay data.[12]General information provided in such MLS data sheets is a type of information reasonably relied upon by experts in the appraisal field for forming opinions of value.Some appraisers may include such data sheets on the comparables used in their appraisal in an addendum to the appraisal.

However, when such raw data sheets are presented by a taxpayer, separate from an appraisal, they do not have probative value for arriving at a conclusion of value.This is because no adjustments have been made to each individual sale to make the sale property comparable to the subject for purposes of arriving at true value in money.What taxpayers are actually doing by presenting such documents is to ask the Hearing Officer to do an appraisal based upon the properties presented.The Hearing Officer’s expertise is in the analyzing and weighing of relevant evidence to arrive at an opinion of value.The function of the Hearing Officer is not to examine raw sales data to determine if given sales might be appropriate comparables for a given appraisal problem.Neither is the Hearing Officer’s function to act as an appraiser for either Complainant or Respondent.

The tendered MLS documents not being a part of an appraisal report were inadmissible hearsay and had no probative value to establish the true value in money for the subject property.

Complainant’s Observations & Conclusions

The final portion of Exhibit A consisted of Mr. Mittelstadt’s own observations based upon his research of various sales transactions, as well as the general information in the other excluded portions of Exhibit A.The opinion of value put forth in the papers prepared by Complainant was $419,800.This opinion of value was not based however, upon the appraisal by Mr. Noonan.Instead, Mr. Mittelstadt took a 20% reduction in the assessor’s 2007-08 value of $524,800 that had been placed on the subject property.In the documents prepared by Mr. Mittelstadt there is no reference or reliance on the Noonan appraisal.

In utilizing this methodology of making a deduction from the January 1, 2007, appraised value set by the Assessor, Complainant totally ignored the fact that his own purchase of the subject property March 22, 2005, had been for $689,000.[13]In other words, the property as valued by the Assessor on January 1, 2007, was just under 24% below the fair market value of the property just 21 months earlier.This creates a serious doubt in the mind of the Hearing Officer as to whether the $524,800 represented the true value in money of the Complainant’s property on January 1, 2007.In any event, the methodology as presented by the Complainant is not sufficient to establish true value in money for the property.It is not a recognized methodology for the appraisal of property in an appeal before the Commission.

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.[14]True value in money is defined in terms of value in exchange and not value in use.[15]It is the fair market value of the subject property on the valuation date.[16]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.[17]

Complainant’s 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, 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]

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]Mr. Mittelstadt’s opinion based upon Exhibit A was not founded upon proper elements or a proper foundation. Accordingly, the opinion of value of $419,800, to the extent based upon Exhibit A is not persuasive and does not constitute substantial and persuasive evidence of value.

To the extent the taxpayer’s opinion of value was based upon Exhibit B, that opinion did not have probative value.The appraisal by Mr. Noonan was performed for a refinance of the subject property.Its appraisal date was November 21, 2009.Mr. Noonan was unable to provide a specific figure for an indicated value as of January 1, 2009, but opined it could be a five percent variance either way from the $419,000 figure.Such an opinion, absent a detailed analysis of how the opinion was reached fails to constituted substantial and persuasive evidence to rebut the presumption of correct assessment and prove value.

Complainant failed to meet the required burden of proof.Accordingly, the presumption of correct assessment by the Board stands.


The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for St. Louis City for the subject tax day is AFFIRMED.

The assessed value for the subject property for tax years 2009 and 2010 is set at $114,300.

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 appeal is based will result in summary denial. [24]

Disputed Taxes

The Collector of St. Louis City, 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 April 6, 2010.



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 6thday of April, 2010, to:Paul Mittelstadt, 21 Maryland Plaza, St. Louis, MO 63108, Complainant; Carl W. Yates III, Associate City Counselor, 314 City Hall, St. Louis, MO 63103, Attorney for Respondent; Ed Bushmeyer, Assessor, 120 City Hall, St. Louis, MO 63103; Gregory Daly, Collector, 110 City Hall, St. Louis, MO 63103.


Barbara Heller

Legal Coordinator

Contact Information for State Tax Commission:

Missouri – State Tax Commission

P.O. Box 146

301 W. High Street, Room 840

Jefferson City, MO 65102


573-751-1341 FAX

[1] Case was originally set for a February 10, 2010, evidentiary hearing.At that hearing, Complainant offered Exhibit B into evidence and it was excluded upon objection by Counsel for Respondent.Upon Complainant’s representation that he was unaware that the appraiser must be present for the appraisal to come into evidence, and upon verification that Complainant had not received information from the Commission or the Commission website addressing the matter of testimony being required by an appraiser for admission of an appraisal report.The hearing was continued to February 18th to permit Complainant’s appraiser to be present to testify.Exhibit B was received into evidence at the hearing on February 18th.

[2] Exhibit B – Thomas R. Noonan Appraisal.Respondent’s appraisal gave the gross living area at 2,390.The Hearing Officer ran the calculations for the dimensions of the first, second and third floors as shown for the Building Sketch on page 24 of Exhibit B and confirmed that the gross living area was 2,726 as shown in Exhibit B.

[3] Exhibit B; Exhibit 1.

[4] Testimony of Mr. Mittelstadt.

[5] Exhibit A consists of Complainant’s compilation of valuation data.It is a 24 page documents which includes (1) observations and conclusions of Complainant relative to his opinion of value for the subject property; (2) articles and charts on overall housing trends showing general declines in housing values; and (3) Multi-List Service information sheets on eight 2008-09 sold properties.

[6] Exhibit B.

[7] Section 137.115.1, RSMo.

[8] Exhibit 1 – Keller Appraisal.

[9] Article X, section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo.


[10] 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).


[11] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).


[12] 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). 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.

[13] Exhibit B, p. 9; Exhibit 1-Certificate of Value.

[14] 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).


[15] 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).


[16] Hermel, supra.


[17] 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.


[18] Hermel, supra.


[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).


[20] See, Cupples-Hesse, supra.