RONALD & SHERRY KERSTING, )
v. ) Appeal Number 01-32511
EUGENE ZIMMERMAN, ASSESSOR, )
ST. CHARLES COUNTY, MISSOURI, )
DECISION AND ORDER
Decision of the St. Charles County Board of Equalization reducing the assessment made by the Assessor, SET ASIDE. The Hearing Officer finds true value in money for the subject property for tax years 2001 and 2002 to be $25,000, assessed value of $4,750, as residential property.
Complainants appeared pro se.
Respondent represented by Counsel, Lisa Leslie, Assistant County Counselor.
Case decided by Chief Hearing Officer, W. B. Tichenor.
The Commission takes this appeal to determine the classification for the subject property on January 1, 2001.
Complainant appeals the decision of the St. Charles County Board of Equalization which reduced the valuation of the subject property, but sustained the classification. The Assessor determined an appraised value of $33,520 (assessed value of $10,730, as commercial property). The Board reduced the appraised value to $25,000, but sustained the classification as commercial for an assessed value of $8,000. Complainant did not appeal the valuation of $25,000, but appealed the classification as commercial property and proposed an assessed value as residential property of $4,750). The evidentiary hearing was waived by the parties and the case was submitted on documents. Counsel for Respondent requested permission to filed written direct testimony out of time, February 1, 2002.
The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
Complainant filed the following exhibits (November 6, 2001) which are received into evidence.
Exhibit A Photograph of subject building, with description statement as to the use of the building, copy of property record card and a locator map showing the location of the subject property.
Exhibit B Photograph of a comparison property, with a description statement as to the use of the building, copy of the property record card and a locator map showing the location of the comparison property.
Exhibit C Photograph of a comparison property, with a description statement as to the use of the building, copy of the property record card and a locator map showing the location of the comparison property.
Exhibit D Copy of St. Charles County Building Department Inspection Report on subject property.
Exhibit E Copy of St. Charles County Planning Department Land Use Permit for subject property.
Exhibit F Written Direct Testimony of Complainants. Filed December 31,2001.
Respondent filed the following exhibit (out of time, February 2, 2002) which is received into evidence.
Exhibit 1 Written Direct Testimony of Todd Powelson, Market Research/Appeals Manager for St. Charles County Assessor.
FINDINGS OF FACT
1. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission from the decision of the St. Charles County Board of Equalization.
2. The subject property is located at 14 Main Street, Orchard Farm, Missouri. The Property is identified by PIN # 879960A000 or lot 14 of the town of Orchard Farm. The property consists of a 90 by 140 foot lot. It is improved by a 42 by 64 foot metal pole barn building. Exhibit A. Residences are located on the subject street. Exhibit C. The lot is in an I1 zoning district (light industrial). The lot is subject to a front set back of 35 feet, a side setback of 10 feet, and a rear setback of 15 feet. Exhibit E.
3. Valuation is not at issue. The fair market value of the subject property is $25,000, as determined by the Board of Equalization. Exhibit A, Exhibit 1, Q & A 9.
4. The subject land and building are used only by complainants for personal storage. Complainants’ home is not on the same property. The subject building contains a boat, tractor, 24 foot enclosed trailer, motorcycle and some tools, all belonging to Complainants. No industrial or commercial equipment is stored at the property. No industrial or commercial activities are conducted on the property. Exhibits A, B & F; Exhibit 1, Q & A 16.
5. The property located at lot 4 on Kisker Drive, Orchard Farm, Missouri is located three lots to the East of the subject property and backs to an alley which separates the back of lots 1 through 11 on Kisker Drive from the back of lots 1 through 16 on Main Street. Lot 4 is a 90 by 212 foot lot. It is improved by a 34 by 80 foot block building. The building is used for personal storage by the owners (Dennis J. & Paula R. Pugh). The owners’ home is not located on this property or any adjoining property. The building contains old cars, automotive parts and tires and tools. No industrial or commercial equipment is stored at the property. No industrial or commercial activities are conducted on the property. This property is classified as residential. Exhibits B & F.
6. The property located at lot 8 on Main Street, Orchard Farm, Missouri is located 4 lots to the East of the subject property. Lot 8 is a 40 by 140 foot lot. It is improved by a 46 by 73 foot metal building with a 7 by 19 foot addition on the west side. The building is used for personal storage by the owners. The owners’ home is not located on this property or any adjoining property. The building contains three vehicles, several lawn mowers and various tools. No industrial or commercial equipment is stored at the property. No industrial or commercial activities are conducted on the property. This property is classified as residential. Exhibits C & F.
7. The St. Charles County Building Department in its inspection report of the subject property identified the property as residential. Exhibits D & F.
8. The St. Charles County Planning Department in issuing its Land Use Permit on July 11, 2000, approved the permit for construction of the subject pole barn but restricted the use of the structure FOR PERSONAL USE ONLY; NO LIVESTOCK, HUMAN HABITATION, COMMERCIAL OR INDUSTRIAL USE IS ALLOWED.
9. No evidence which would establish a change in use of the subject property during the year 2001 was presented.
10. The presumption that the Board of Equalization properly classified the subject property is rebutted. The classification for the property for tax years 2001 and 2002 is residential. The assessed value of the property is $4,750 ($25,000 x .19 = $4,750).
CONCLUSIONS OF LAW
The Commission has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious. Article X, section 14, Mo. Const. of 1945; Sections 138.430, 138.431, RSMo. 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. Section 138.431.4, RSMo.
Board of Equalization Presumption
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization. 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).
Classification of Real Property
All other real property not included in property listed as residential or agricultural and horticultural property shall be deemed to be included in the term utility, industrial, commercial railroad and other real property. Section 137.016.1(3), RSMo.
All real property for which a determination as to its classification cannot be made under the definitions set out in 137.016.1, shall be classified according to its immediate most suitable economic use, which use shall be determined after consideration of
(1) Immediate prior use, if any, of such property;
(2) Location of such property;
(3) Zoning classification of such property;
(4) Other legal restrictions on the use of such property;
(5) Availability of water, electricity, gas, sewers, street lighting, and other public services for such property;
(6) Size of such property;
(7) Access of such property to public thoroughfares; and
(8) Any other factors relevant to a determination of the immediate most suitable economic use of such property.
Rules of Construction
The meaning of an unclear word or phrase should be determined by the words immediately surrounding it. noscitur a sociis, Blacks Law Dictionary, Seventh Edition, West Group, 1999. When a general word or phrase follows a list of specific persons or things, the general word or phrase will be interpreted to include only persons or things of the same type as those listed. ejusdem generis, Blacks Law Dictionary, Seventh Edition, West Group, 1999.
The subject property has been classified by the Assessor and the Board of Equalization under the provisions of subsection 3 of Section 137.016 to be other real property. The phrase other real property appears in conjunction with specific descriptive words for certain kinds of real property. Those words are utility, industrial, commercial and railroad. These words are given description and definition from the statute by the words commercial, mining, industrial, manufacturing, trade, professional and business. None of these descriptive words are applicable to the present use of the subject property.
The lot, with its pole barn improvement, is used in the nature of a garage or storage building. Such structures when located on a tract of land improved by a residence are generally, if not universally classified within Missouri as residential property. Unless such a garage structure is actually being utilized for an agricultural or commercial purpose, it takes the classification of residential as it is considered to be adjunct to and utilized as part of the overall residential purpose of a property improved by a house. This is true irrespective of whether the garage is attached to a residential building or detached, as in the case of the subject building.
Were the property under appeal being used for some industrial, manufacturing, commercial enterprise or related purpose, then its actual commercial use would control its classification. However, because the actual use of the property is what is, and has been, considered by the Commission to be a residential use, i.e. storage of motor vehicles, tools, etc., generally associated with the type of material stored in a homeowner’s garage, the property takes on a residential purpose, as opposed to a commercial purpose. Therefore, the property under appeal, while not fitting under the definitions set forth in paragraphs (1) and (2) of Section 137.016.1, does not fit with the descriptive words for the uses recognized under paragraph (3). An analysis under Section 137.016.5 of real property for which a determination cannot be made under subsection 1 is appropriate in order to arrive at a conclusion as to a residential or commercial classification for the subject property.
Immediate Prior Use
The immediate prior use of the subject property before the improvement was constructed appears to have been as a vacant lot, which was classified as residential property by the assessor, at least from 1993 through 2000. Exhibit A. There has been no industrial, manufacturing, or business use on the property in its immediate past history. The immediate prior use factor weighs in on a residential classification.
The property is located in an area which appears to have been laid out for residential lots. Exhibit A. No information was provided as to the actual development of the other lots on Main Street, Kisker Drive, or Meadow Vue Drive, which is two streets to the North of the subject property. There is residential development on the street where the subject is located. The photograph on Exhibit C shows houses on either side of the storage garage on Lot 8 of Main Street. The location appears to favor a residential classification.
The property is in a zoning district identified as I1 – Light Industrial. This zoning is not further described, however, it is clear that residential development is permitted within this zoning, since residences exist in very close proximity to the subject on the same street. Exhibit C. Therefore, the zoning, which permits residential use, would permit a residential classification.
The land use permit issued by the St. Charles County Planning Department restricts the use of the structure to personal use. In this case it’s actual use of storage of vehicles, tools, etc. The land use permit specifically restricts the garage from being use for holding livestock, human habitation or any commercial or industrial use. The structure is not a structure designed for human habitation, accordingly it is restricted from any such use. Although it could be utilized as a barn structure for the keeping of livestock, or as a structure for some type of business purpose, it is also restricted from these uses also. The front, side and rear yard set back requirements would have permitted the construction of a house which could have been located within or on the footprint of the subject structure or the subject structure for what is associated with a residential use. The only use which is permitted is a personal use, which is the same general use to which a garage on a lot improved by a house is put. This personal use restriction indicates a residential classification is appropriate.
The availability of public services, based on the close proximity of residences to the subject lot, demonstrates that the vacant subject lot could have been developed for residential purposes by the construction of a home. The public services would support either a residential or commercial use, just as in the same manner, the zoning would permit either a residential or commercial.
The access of the property to public thoroughfares was not demonstrated to weigh more on the side of commercial or residential. The locator map does not demonstrate that the portion of Main Street, upon which the subject is located, is a roadway that would be considered a commercial thoroughfare. With the existence of residences on the street it appears to be more in the nature of a residential street.
Two important other factors demonstrate that the proper classification for the subject property is residential. These two factors are the classification of two properties located within the same block as the subject, which are being used for the exact same purpose as the subject property, that are classified as residential properties. Both of these properties, since 1992 have been classified as residential properties. Exhibits B & C. The classification of these garages, which are detached from a house, as residential is the appropriate recognition that such structures serve a residential purpose, not in providing habitation for humans, but in providing space for the location and stroage of vehicles and implements which are consistent with and appropriate to residential living. A further factor for residential classification is the recognition by the St. Charles County Building Department in its inspection of the subject structure that it serves a residential purpose. Exhibit D.
The analysis of the most suitable economic use of the subject property, as it is developed, results in the conclusion that a residential classification is appropriate. Furthermore, to continue to classify the property as commercial would be unfair, unlawful and an arbitrary and capricious classification in light the classification of two properties being used in an identical manner as residential. The actual use to which the property is being put has no characteristics of a industrial, business or commercial use. The actual use is a residential use. The real property is being used as a garage by the owners to house their own personal property.
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for St. Charles County for the subject tax day is SET ASIDE.
The assessed value for the subject property for tax years 2001 and 2002 is set at $4,750.
A party may file with the Commission an application for review of this decision within thirty (30) days of the mailing of such decision. The application shall contain specific grounds upon which it is claimed the decision is erroneous. Failure to state specific facts or law upon which the appeal is based will result in summary denial. Section 138.432, RSMo 1994.
If an application for review of this decision is made to the Commission, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the Commission. If no application for review is received by the Commission within thirty (30) days, this decision and order is deemed final and the Collector of St. Charles County, as well as the collectors of all affected political subdivisions therein, shall disburse the protested taxes presently in an escrow account in accord with the decision on the underlying assessment in this appeal. If any or all protested taxes have been disbursed pursuant to Section 139.031(8), RSMo, either party may apply to the circuit court having jurisdiction of the cause for disposition of the protested taxes held by the taxing authority.
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 March 6, 2002.
STATE TAX COMMISSION OF MISSOURI
W. B. Tichenor
Chief Hearing Officer
DENYING APPLICATION FOR REVIEW
OF HEARING OFFICER DECISION
On March 6, 2002, Chief Hearing Officer, W. B. Tichenor, entered his Decision and Order (Decision) setting aside the assessment by the St. Charles County Board of Equalization and finding the classification of the subject property to be residential with an assessed value of $4,750 (true value in money of $25,000).
Respondent’s Grounds for Review
Respondent timely filed his Application for Review of the Decision on April 1, 2002. Respondent subsequently filed an amendment Application for Review on April 3, 2002. The ground stated in the Application for Review was that the Hearing Officer erroneously applied the law in classifying the subject property as residential.
A review of the record in the present appeal provides support for the Findings of Fact and Conclusions of Law determined by the Hearing Officer. None of the Findings of Fact made by the Hearing Officer were challenged by Respondent in his Application for Review. Therefore, said Findings stand as admitted.
The Hearing Officer made a detailed analysis of the applicable portions of Sections 137.016.1(3) and 137.016.5, RSMo. The analysis of Section 137.016.5 as applied to the facts on this record was pertinent and proper. In sum, the Hearing Officer simply classified the subject property as the Respondent classified buildings being used for the same purpose within a block’s distance of the subject property. In doing so, the Hearing Officer provided sound and correct reasoning to support the classification. The Commission finds no basis to support a determination that the Hearing Officer acted in an arbitrary or capricious manner or abused his discretion as the trier of fact and concluder of law in this appeal. Hermel, Inc. v. STC, 564 S.W.2d 888 (Mo. 1978); Black v. Lombardi, 970 S.W.2d 378 (Mo. App. E.D. 1998); Holt v. Clarke, 965 S.W.2d 241 (Mo. App. W.D. 1998); Smith v. Morton, 890 S.W.2d 403 (Mo. App. E.D. 1995). A reasonable mind could have conscientiously reached the same result based on a review of the entire record and the legal analysis developed by the Hearing Officer. Phelps v. Metropolitan St. Louis Sewer Dist., 598 S.W.2d 163 (Mo. App. E.D. 1980).
The Hearing Officer did not err in his application of the law relative to the correct classification of the subject property as challenged by Respondent. The Respondent’s point is not well taken.
The Commission upon review of the record and Decision in this appeal, finds no grounds upon which the Decision of the Hearing Officer should be reversed or modified. Accordingly, the Decision is affirmed.
Judicial review of this Order may be had in the manner provided in Sections 138.470 and 536.100 to 536.140, RSMo within thirty days of the date of the mailing of this Order.
SO ORDERED April 29, 2002.
STATE TAX COMMISSION OF MISSOURI
Sam D. Leake, Chairman
Bruce E. Davis, Commissioner
Jennifer Tidwell, Commissioner