Poplar Bluff Housing Associates v. Chris Rickman, Assessor, Butler County, Missouri

July 1st, 2022


Complainant, )
) Appeal No. 21-45500
) Parcel No. 13-02-10.0-002-006-013.000
v. )
Respondent. )


Poplar Bluff Housing Associates (Complainant) appeals the Butler County Board of Equalization’s (BOE) decision affirming Respondent’s value of $1,629,460 as of January 1, 2021.[1]  Complainant alleges overvaluation and proposes a value of $926,249.  The BOE decision is set aside.  The true value in money (TVM) of the subject property as of January 1, 2021, was $926,250.


  1. The Subject Property. The subject residential property consists of a federally subsidized housing development known as the Oak Grove Apartments located at 1295 Velma Street in Poplar Bluff, Missouri.  The property has 44 one- and two-bedroom apartments.
  2. Assessment and Valuation. The BOE determined the TVM of the subject property as of January 1, 2021, was $1,629,460.
  3. Complainant’s Evidence. Complainant introduced Exhibits A through F.  Complainant’s exhibits are summarized as follows:
Exhibit A Land Use Restriction Agreement (LURA) for subject property.
Exhibit B Oak Grove Apartments rent roll as of January 1, 2021.
Exhibit C 2018-2019 Oak Grove Audited Financial Statements
Exhibit D 2019-2020 Oak Grove Audited Financial Statements
Exhibit E 2021 Oak Grove Subsidized-Housing-Worksheet
Exhibit F Written direct testimony of Sheila Calvert

Calvert testified she is the General Manager for the property management company Complainant hired to manage the subject property.  Calvert’s testified she is familiar with documents labelled Exhibits A through F.

Exhibit A is a copy of the LURA restricting use of the subject property and requiring compliance with Section 42 of the Internal Revenue Code.  Exhibits B, C, and D include rent rolls and audited financial statements showing the actual income and expense data for the subject property.  Exhibit E is the subsidized housing worksheet summarizing the data from Exhibits B, C, and D.  Collectively, Complainant’s Exhibits show the subject property is a federally subsidized, rent-restricted housing development generating net operating incomes of $67,559 in 2018; $48,065 in 2019; and $60,827 in 2020.  Complainant applied an overall capitalization rate of 6.35% for each year, resulting in estimated values of $1,063,921 in 2018; $756,921 in 2019; and $957,906 in 2020.  Complainant’s proposed value of $926,249 is based on the average of these three estimated values; i.e., ([1,063,921+ 756,921 + 957,906] / 3 = 926,249.33)

  1. Respondent’s Evidence. Respondent introduced no exhibits.  Respondent testified the BOE value should be affirmed because Complainant voluntarily dismissed an appeal from the prior assessment setting the same value as the 2021 assessment. Respondent also testified Complainant’s appeals from the 2015 and 2017 assessments resulted in stipulated values higher than Complainant’s current proposed value of $926,249.  Respondent testified the stipulations and dismissals show the BOE value represents the subject’s TVM as of January 1, 2021.
  2. Value. The TVM of the subject property as of January 1, 2021, was $926,250.


  1. Assessment and Valuation. Residential real property is assessed at 32% of its TVM as of January 1 of each odd-numbered year. Section 137.115.5(1)(a).  The TVM is “the fair market value of the property on the valuation date[.]”  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).  “True value in money is defined in terms of value in exchange not value in use.”  Tibbs v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 7 (Mo. App. S.D. 2020) (internal quotation omitted).  “Determining the true value in money is an issue of fact for the STC.”  Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008).

In pertinent part, Section 137.076.2 requires the use of an “income-based approach” to value real property with “federal or state imposed restrictions in regard to rent limitations, operations requirements, or any other restrictions imposed upon the property in connection with … Section 42 of the Internal Revenue Code[.]”  The statutorily mandated “income-based approach” requires “the use of direct capitalization methodology and computed by dividing the net operating income of the parcel of property by an appropriate capitalization rate not to exceed the average of the current market data available in the county of said parcel of property.”   The Section 137.076.2 income approach utilizes the subject property’s “actual income and expenses” because they “reflect the only use … that is readily available in the reasonably near future: as low-income housing subject to rent-restricted income.”  Tibbs, 599 S.W.3d at 11 (emphasis added).

  1. 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). “Although technical rules of evidence are not controlling in administrative hearings, fundamental rules of evidence are applicable.”  Mo. Church of Scientology v. State Tax Comm’n, 560 S.W.2d 837, 839 (Mo. banc 1977).
  2. Complainant’s Burden of Proof. The taxpayer bears the burden of proof and must show by a preponderance of the evidence the property is overvalued.  Westwood P’ship v. Gogarty, 103 S.W.3d 152, 161 (Mo. App. E.D. 2003).  The BOE’s valuation is presumptively correct. Tibbs, 599 S.W.3d at 7.  The “taxpayer may rebut this presumption by presenting substantial and persuasive evidence that the valuation is erroneous.”  Id. (internal quotation omitted).  The taxpayer also 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 v. State Tax Comm’n, 722 S.W.2d 72, 77 (Mo. banc 1986) (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”).
  3. Complainant Produced Substantial and Persuasive Evidence of Overvaluation.

Complainant produced substantial and persuasive evidence establishing the subject property’s actual net operating income for the three years prior to 2021.  Complainant applied a 6.35% capitalization rate.  Respondent testified the 6.35% rate was higher than that utilized in the disposition of other subsidized housing appeals in Butler County, but there is no persuasive evidence showing Complainant’s 6.35% rate “exceed[s] the average of the current market data available in the county.”  Section 137.076.2.  Collectively, Complainant’s Exhibits A through F are substantial and persuasive evidence showing both Section 137.076.2 applies and that Complainant’s estimated value is based on methodology required by the statute.  The actual income and expense data for the three years preceding 2021 persuasively establishes that the subject’s TVM as of January 1, 2021, was $926,250.

Respondent’ evidence – consisting primarily of testimony regarding past settlements and dismissals – does not change the analysis.  The general rule is that evidence of settlement offers or completed settlements “in the same or in a different case” are generally inadmissible.  In the Matter of Rate Increase Request for Liberty Utilities (Missouri Water), LLC, 592 S.W.3d 82, 94 (Mo. App. W.D. 2019) (internal quotation omitted).  “The desire to encourage settlements is fully applicable to settlement of administrative actions.”  Id.  Evidence of settlement agreements is “highly prejudicial,” Daniel v. Indiana Mills & Mfg., Inc., 103 S.W.3d 302, 316 (Mo. App. S.D. 2003), and admitting such evidence undermines the policy of encouraging settlements.  Hancock v. Shook, 100 S.W.3d 786, 799 (Mo. banc 2003).

While Complainant did not specifically object to the admissibility of Respondent’s testimony regarding prior settlements and dismissals, Respondent’s testimony is not substantial and persuasive evidence supporting the BOE value.  The relevance of past settlements or dismissals is limited because settlement often represents a “compromise position … less favorable than the result a party might seek at trial.”  Hancock, 100 S.W.3d at 799.  Prior settlements and dismissals do not constitute an admission of the subject’s value as of January 1, 2021, and they are not market-based evidence supporting the BOE value.  Instead, they simply show the end result of an unknown prudential calculus leading to a compromise resolution of past appeals.  The prior settlements and dismissals do not undermine the persuasiveness of Complainant’s evidence showing the subject’s TVM as of January 1, 2021, was $926,250.


The BOE’s decision affirming Respondent’s value of $1,629,460 as of January 1, 2021, is set aside.  The TVM as of January 1, 2021, was $926,250.

Application for Review

A party may file 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 of Missouri, 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 Butler County, and 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 the disputed taxes have been disbursed pursuant to a court order under the provisions of section 139.031.

SO ORDERED July 1, 2022.

Eric S. Peterson

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 July 1, 2022, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.

Amy S. Westermann
Chief Counsel

[1] 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, sec. 14; Section 138.430.1, RSMo 2000.  All statutory citations are to RSMo 2000, as amended.