State Tax Commission of Missouri
RONALD & TERESE BREWER,)
)
Complainants,)
)
v.) Appeal Number 09-62500
)
CONNIS HOOVER, ASSESSOR,)
JASPER COUNTY, MISSOURI,)
)
Respondent.)
DECISION AND ORDER
HOLDING
Decision of the Jasper County Board of Equalization reducing 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 $274,780, residential assessed value of $52,210.Complainant, Ronald Brewer, appeared pro se.Respondent appeared by Assistant Prosecuting Attorney, Jeremy Crowley.
Case heard and decided by Senior Hearing Officer W. B. Tichenor.
ISSUE
The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2009.
SUMMARY
Complainant appeals, on the ground of overvaluation and discrimination, the decision of the Jasper County Board of Equalization, which reduced the valuation of the subject property.The Assessor determined an appraised value of $304,740, assessed value of $57,900, as residential property.The Board reduced the value to $274,780, assessed value of $52,210.Complainants proposed a value of $246,280, assessed value of $46,790.A hearing was conducted on October 27, 2009, at the Jasper County Courthouse, Carthage, Missouri.
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 Jasper County Board of Equalization.
2.Complainants’ Evidence.Mr. Brewer testified in his own behalf.The owner’s opinion of value was based on 6% reduction in the 2006 purchase price of the property.The basis for the reduction was the current economic climate and depressed housing market.[1]
Mr. Brewer offered into evidence Exhibit A.There was no objection.Exhibit A was received into evidence.Exhibit A consisted of the following documents: cyberhomes article, 8/27/09; Standard & Poor’s Press Release, 11/25/08; Carl Junction, Missouri Real Estate Overview, 7/7/09; Carl Junction, Missouri Market Trends, 10/22/09; Joplin Globe article – Homeowners challenging hikes in property values in Jasper County – 7/5/09; Jasper County Website, 7/15/09; Joplin Globe website articles on assessments;Press Release from Freddie Mac – National Home Price Decline Decelerated in First Quarter – 5/28/09;MultiListService Data Sheets on five properties; Property Record Card on Subject – 6/23/09; and Property Record Card on Subject – 7/6/09.
3.Respondent’s Evidence.Respondent offered into evidence Exhibit 1 – valuation data and the testimony of Lisa Perry, Administrative Assistant to Respondent.
Exhibit 1 consisted of the following documents: Property Record Card and photograph of subject; Locator Map for subject and comparable properties; Property Record Cards and photographs on four comparable properties.Exhibit 1 was received into evidence.
4.Subject Property.The subject property is located at 403 Sunnybrook Drive, Carl Junction, Missouri.The property is identified by map parcel number 16-4-17-72.007.The property consists of .5496 of an acre lot improved by a single-family home with 3,075 square feet of living area.The home was built in 2006.Complainants purchased the home in December 2006 for $262,000.[2]
5.No New Construction and Improvement.There was no evidence of new construction and improvement from January 1, 2009, to the date of the hearing and Complainants have no plans for any new construction and improvement prior to January 1, 2010.Therefore the value for 2009 will remain the value for 2010.[3]
6.Complainants Fail to Meet Burden of Proof. Complainants’ 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, 2007, to be $246,280.
7.No Evidence of Discrimination.No evidence was presented addressing the claim of discrimination, therefore it is deemed abandoned.
CONCLUSIONS OF LAW AND DECISION
Jurisdiction
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.[4]
Presumptions In Appeals
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.[5] 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.[6]The evidence presented by Complainants consisted of a variety of hearsay documents, none of which individually or all of them collectively rose to the level of substantial and persuasive evidence to establish that the fair market value of the subject property on January 1, 2009, would have been $246,280.
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.[7]It is the fair market value of the subject property on the valuation date.[8]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.[9]
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.[10]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.[11]Complainants failed to present an opinion of the true value in money for their property based upon a recognized methodology for valuation of real estate in ad valorem tax appeals.
Complainants’ Burden of Proof
In order to prevail, Complainants 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.[12]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.”[13]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[14]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.[15]
The owner of property is generally held competent to testify to its reasonable market value.[16]The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.[17]Mr. Brewer based his opinion of value on an arbitrary 6% reduction in the purchase price.This is not a methodology for valuing property for ad valorem tax purposes that has been recognized by the Courts or the Commission.None of the documents proffered by Complainants established that a willing buyer and seller would have agreed to a sale price for the subject property of $246,280 on January 1, 2009.Therefore, the owner’s opinion of value is not based on proper elements or a proper foundation.It has no probative value in this appeal.The valuation set by the Board must be affirmed.
Real Estate Market News
The Hearing Officer is very much aware of the multitude of news stories concerning the real estate market in the nation over the past year or more.However, such news stories and articles from whatever sources are not evidence of what a willing buyer and seller would agree to for the value of a given property.The fact that some data shows a certain percentage decline in home values is irrelevant to the question of what is the fair market value of the property under appeal in a State Tax Commission hearing.There are accepted methodologies for valuing real property for assessment purposes.Reliance on percentage decreases or increases for real estate values on a national, state, or local basis is not a proper basis for finding value.
ORDER
The assessed valuation for the subject property as determined by the Board of Equalization for Jasper County for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax years 2009 and 2010 is set at $52,210.
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.The application shall contain specific 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. [18]
The Collector of Jasper County, as well as the collectors of all affected political subdivisions therein, shall continue to hold the disputed taxes pending a 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 November 24, 2009.
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 24th day of November, 2009, to:Ronald Brewer, 403 Sunnybrook Drive, Carl Junction, MO 64834, Complainant; Jeremy Crowley, Assistant Prosecuting Attorney, 601 Pearl, Room 100, Joplin, MO 64801, Attorney for Respondent; Connie Hoover, Assessor, 302 S. Main Street, Carthage, MO 64836; Bonnie Earl, Clerk; Stephen Holt, Collector, Jasper County Courthouse, Carthage, MO 64836.
___________________________
Barbara Heller
Legal Coordinator
[5] 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).
[6] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
[7] 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).
[9] 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.
[10] See, Nance v. STC, 18 S.W.3d 611, at 615 (Mo. App. W.D. 2000); Hermel, supra;Xerox Corp. v. STC, 529 S.W.2d 413 (Mo. banc 1975).
[11] 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).
[13] 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).
[16] Rigali v. Kensington Place Homeowners’ Ass’n, 103 S.W.3d 839, 846 (Mo. App. E.D. 2003); Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970).
[17] 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).