State Tax Commission of Missouri
RONALD WILLIAM CALLIS,)
v.) Appeal No.09-81500
RICHARD TREGNAGO, ASSESSOR,)
RANDOLPH COUNTY, MISSOURI,)
DECISION AND ORDER
Decision of the Randolph County Board of Equalization sustaining the reducing made by the Assessor is AFFIRMED.True value in money for the subject property for tax years 2009 and 2010 is set at $92,900, commercial assessed value of $29,730.Complainant appeared pro se.Respondent appeared pro se.
Case heard and decided by Senior Hearing Officer W. B. Tichenor.
Complainant appeals, on the ground of overvaluation, the decision of the Randolph County Board of Equalization, which reduced the valuation of the subject property.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.
FINDINGS OF FACT
1.Jurisdiction.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the decision of the Randolph County Board of Equalization.A hearing was conducted on May 26, 2010, at the Randolph County Courthouse, Huntsville, Missouri.
2.Assessment.The Assessor appraised the subject property at $99,602, a commercial assessed value of $31,870.The Board of Equalization reduced the value to $92,900, assessed value of $29,730.
3.Subject Property.The subject property is located at 318 West Coates Street, Moberly, Missouri.The property is identified by map parcel number 10-1-1-2-4-104.The property consists of a lot of approximately 9,000 square feet.The property is improved with an office building that occupies approximately half of the total site.The remainder of the lot is a hard surfaced parking lot.The building is of concrete block construction.
4.Complainant’s Evidence.Two exhibits were received into evidence on behalf of Complainant. Exhibit A consisted of (1) a comparison of the subject to a property at 509 West Rollins, Moberly, with a calculated value; (2) a Real Estate Contract, dated 3/8/07 for the purchase of the property at 509 West Rollins (Rollins Building); (3) a photograph and building diagram of the West Rollins property; and (4) a photograph and building diagram of the subject property.Exhibit B was the written direct testimony of Mr. Callis.
Mr. Callis subtracted $20,000 from the 2007 sale price of $185,000 for the West Rollins property for sales price of a house that was part of the 2007 transaction.He then deducted $90,750 as an adjustment bases on size.This resulted in a value of $74,250.This was the methodology utilized to support the opinion of value of $75,000.
Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the true value in money as of January 1, 2009, to be $75,000, as proposed.
5.Respondent’s Evidence.Two exhibits were received into evidence on behalf of Complainant.Exhibit 1 was the appraisal report of Mr. Tregnago.Exhibit 2 was the written direct testimony of Mr. Tregnago.The Respondent performed a sales comparison approach relying on three sales of properties to conclude the value of $92,900, in support of the Board’s valuation.The adjusted sales prices of the three comparables were:$87,000, $103,500 and $96,000.
CONCLUSIONS OF LAW AND DECISION
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.
Presumption In Appeals
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.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.As will be addressed below, the evidence presented by Complainant did not achieve the standard of substantial and persuasive to rebut the presumption of correct assessment and prove the value proposed.
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.True value in money is defined in terms of value in exchange and not value in use.It is the fair market value of the subject property on the valuation date.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.
Methods of Valuation
Proper methods of valuation and assessment of property are delegated to the Commission.It is within the purview of the Hearing Officer to determine the method of valuation to be adopted in a given case.Missouri courts have approved the comparable sales or market approach, the cost approach and the income approach as recognized methods of arriving at fair market value.The methodology utilized by the Complainant was to take a 55% deduction from the sale price of the Rollins office property based on size of the Rollins building and the size of the subject building.This is not a methodology recognized by the Courts or the Commission.Taking such a deduction does not constitute the development of the sales comparison approach.
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.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.”
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.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.
The owner of property is generally held competent to testify to its reasonable market value.The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.In the present instance, the opinion of value testified to by Mr. Callis of $75,000 is based upon his adjustment based upon size to a 2007 sale of the Rollins office building.The March 2007 sale presents a problem since there were three separate sales of the West Rollins property on March 21, 2007.From the testimony of Mr. Tregnago it appears that the group of transactions may have been between related parties.It would not appear that the property had exposure in the open market.Therefore, the use of the March 2007 transaction as an arm’s-length transaction is suspect.
Mr. Callis did not establish that he possesses the education, training and experience to appraise real property.Given that the methodology relied upon by Mr. Callis to arrive at his opinion of value does not represent a proper sales comparison approach to value the owner’s opinion is not based upon proper elements or a proper foundation.Accordingly, no probative weight can be given to that conclusion of value.
Complainant failed to meet his burden of proof.Therefore, 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 Randolph County for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax years 2009 and 2010 is set at $29,730.
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.
The Collector of Randolph 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, 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 June 4, 2010.
STATE TAX COMMISSION OFMISSOURI
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 4thday of June, 2010, to:Ronald Callis, 318 West Coates Street, Moberly, MO 65270, Complainant; Richard Tregnago, Assessor, 110 S. Main, Huntsville, MO 65259; Jim Sears, Clerk, 110 South Main, Huntsville, MO 65259; Shiela Miller, Collector, 110 South Main, Huntsville, MO 65259.
Contact Information for State Tax Commission:
Missouri State Tax Commission
301 W. High Street, Room 840
P.O. Box 146
Jefferson City, MO 65102-0146
 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).
 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).
 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.
 St. Joe Minerals Corp. v. STC, 854 S.W.2d 526, 529 (App. E.D. 1993); Aspenhof Corp. v. STC, 789 S.W.2d 867, 869 (App. E.D. 1990); Quincy Soybean Company, Inc., v. Lowe, 773 S.W.2d 503, 504 (App. E.D. 1989), citing Del-Mar Redevelopment Corp v. Associated Garages, Inc., 726 S.W.2d 866, 869 (App. E.D. 1987); and State ex rel. State Highway Comm’n v. Southern Dev. Co., 509 S.W.2d 18, 27 (Mo. Div. 2 1974).
 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).
 Cohen v. Bushmeyer, 251 S.W.3d 345, (Mo. App. E.D., March 25, 2008); Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992); State, ex rel. Missouri Hwy & Transp. Com’n v. Pracht, 801 S.W.2d 90, 94 (Mo. App. E.D. 1990); Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965).