STATE TAX COMMISSION OF MISSOURI
|ROBERT H. ALLER,||)|
|)||Appeal No. 21-10189|
|v.||)||Parcel No. 22T340738|
|JAKE ZIMMERMAN, ASSESSOR,||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
DECISION AND ORDER
Robert H. Aller (Complainant) appealed the St. Louis County Board of Equalization’s (BOE) decision finding the true value in money (TVM) of the subject property on January 1, 2021, was $155,000. Complainant alleges overvaluation and proposes that the TVM of the subject as of that date was $147,000. The BOE decision is affirmed. The TVM of the subject property on January 1, 2021, was $155,000.
The evidentiary hearing was held on May 25, 2022, via Webex. Complainant appeared pro se via phone and Respondent was represented by counsel Tim Bowe. The appeal was heard and decided by Senior Hearing Officer Benjamin Slawson.
FINDINGS OF FACT
- The Subject Property. The subject residential real property is located at 213 Mar El Court, Ellisville, Missouri. The subject property consists of a ranch-style home on a third of an acre lot with a brick exterior on three sides and masonite siding on the remaining portion. The house was built in 1969 and has 1,318 square feet of living space and an unfinished basement. There are three bedrooms and one and a half bathrooms in the home. Complainant purchased the home in 2005. Complainant has not had the property appraised within the last three years. Complainant has not made any improvements to the property in the last three years.
- Assessment and Valuation. Respondent determined the TVM of the subject property as of January 1, 2021, was $191,300. The BOE independently determined the TVM of the subject property as of January 1, 2021, was $155,000.
- Complainant’s Evidence. Complainant submitted Exhibits A through P and R through U which were admitted without objection. Exhibits A through P are pictures of the interior and exterior of the subject property. These Exhibits also contain brief descriptions of what is depicted in the pictures, and notes concerning the many condition issues and needed repairs for the property. Exhibit R is Complainant’s summary of the needed repairs and condition issues for the subject. Last, Exhibits S through U include information concerning comparable sales found by Complainant, Respondent’s assessment notice for the subject property including a list of the comparables used by Respondent, and also information regarding Missouri’s Homestead Preservation Act.
Complainant testified about the many issues he believes devalue the subject property. Complainant testified that the house has not been updated in many years and has original single pane windows, doors, kitchen fixtures, tile in bathroom, carpet, etc. Complainant has spoken to a few contractors regarding remodeling parts of the house, but did not submit and bids or estimates into evidence.
Complainant asserted that Respondent and the BOE overvalued his property because the comparables used by Respondent are farther south in location than the subject and that many had been renovated and remodeled unlike the subject. Complainant’s opinion of value for the subject property is $147,000, which is based on what he feels the house is worth when examining “as is” sales in the area. Complainant’s primary argument is that the subject property is in an outdated condition, has several issues of deferred maintenance, and thus Respondent overvalued it when making his assessment. Complainant made these arguments to the BOE and submitted the same pictures that are contained in Exhibits A through P.
Complainant testified that he is not a licensed appraiser in the state of Missouri, but he does have some real estate knowledge having worked for MARIS for many years taking pictures for MLS listings. Complainant admitted he does not possess any classroom training on making market-based adjustments to comparable properties to determine the market value of a subject property.
- Respondent’s Evidence. Respondent submitted Exhibit 1, consisting of the October 29, 2021, BOE decision letter for the subject property. Exhibit 1 shows the BOE valued the subject property at $155,000. Exhibit 1 was admitted without objection.
- Value. The TVM of the subject property as of January 1, 2021, was $155,000.
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). 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).
“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. The STC has wide discretion in selecting the appropriate valuation method but “cannot base its decision on opinion evidence that fails to consider information that should have been considered under a particular valuation approach.” Id., at 348.
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. For this reason, the comparable sales approach is typically used to value residential property. “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. “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). 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). “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. The Hearing Officer’s decision regarding the assessment or valuation of the property may be based solely upon his inquiry and any evidence presented by the parties, or based solely upon evidence presented by the parties. Id.
- 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. 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”).
- Complainant Did Not Produce Substantial and Persuasive Evidence of Overvaluation.
Complainant did not produce substantial and persuasive evidence to support his $147,000 opinion of value and claim of overvaluation.
Concerning the condition issues with the subject property that Complainant testified about and which are evidenced in Exhibits A through R, Complainant provided no evidence providing a way to quantify the dollar amount effect of these issues on value or showing the BOE value does not account for these issues. The fact that the BOE lowered Respondent’s assessed value of $191,300 to $155,000 suggests that the BOE did take condition issues such as these into account.
The comparable sales approach is the usual method used to determine the TVM of residential real property. “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.” Snider, 156 S.W.3d at 347-48 (internal quotation omitted). Complainant did list comparables for consideration in Exhibit S. However, Complainant’s evidence does not make adjustments to comparable properties to find a proper appraisal comparison. Even if Complainant had rebutted the presumption of correct valuation by the BOE, Complainant has not proven that the TVM of the subject property is $147,000 as of January 1, 2021. While a property owner’s opinion of value is generally admissible, the opinion “is without probative value where it is shown to have been based upon improper elements or an improper foundation.” Shelby Cty. R-IV Sch. Dist. v. Herman, 392 S.W.2d 609, 613 (Mo. 1965); see also Cohen v. Bushmeyer, 251 S.W.3d 345, 349 (Mo. App. W.D. 2008) (noting a property owner’s opinion of value loses probative value when it rests on an improper foundation).
Complainant presented no appraisal of the subject property in order to determine a value of the subject property. See Cohen, 251 S.W.3d at 349 (holding a landowner’s opinion of value lacks probative value when there is “no other evidence as to what he based his opinion on or how he arrived at his opinion of [value]”). Complainant’s alleged valuation is based on improper elements and therefore is speculative.
Further evidence supports a conclusion that Complainant did not persuasively establish that the BOE value of $155,000 overvalues the property as of January 1, 2021. Complainant testified that he has had several offers to purchase his property, most recently from Grove Properties who offered him $148,000. Last year, another company offered Complainant $145,500 to purchase the property “as is.” Complainant admitted on cross examination that these types of investment companies offer property owners below market value when trying to purchase properties. This testimony regarding recent offers to purchase the subject corroborates a conclusion that an assigned value of $155,000 for January 1, 2021 is not off base.
CONCLUSION AND ORDER
The BOE decision is affirmed. The TVM of the subject property as of January 1, 2021, was $155,000, with an assessed value of $29,450.
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.
The Collector of St. Louis 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 November 4, 2022.
Benjamin C. Slawson
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 4, 2022, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
 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.