STATE TAX COMMISSION OF MISSOURI
| SHANE RYAN, | ) | Appeal No. 21-60000 |
| Complainant, | ) | Parcel No. 10-6.0-23-004-008-005.000 |
| ) | ||
| ) | ||
| v. | ) | |
| ) | ||
| CLINT BAKER, ASSESSOR, | ) | |
| HICKORY COUNTY, MISSOURI, | ) | |
| Respondent. | ) |
DECISION AND ORDER
Shane Ryan (Complainant) appeals the Hickory County Board of Equalization’s (BOE) decision finding the true value in money (TVM) of the subject property on January 1, 2021, was $51,120 with an assessed value of $9,710. Complainant claims the property is overvalued and proposes a value of $25,000. Complainant did not produce substantial and persuasive evidence establishing overvaluation. The BOE’s decision is affirmed.[1] Complainant, pro se, and Clint Baker, Respondent, appeared in person. The evidentiary hearing was conducted on December 2, 2021, at the Hickory County Judicial Building, 22126 US Hwy 54, Hermitage, MO.
FINDINGS OF FACT
- Subject Property. The subject property is located at 24595 Canyon View Rd, Hickory County, Missouri. The parcel/locator number is 10-6.0-23-004-008-005.000.
The subject property consists of a 950 square foot manufactured home and car port. The manufactured home is a double wide, one story ranch with log siding.
- Respondent and BOE. Respondent classified the subject property as residential and determined the TVM on January 1, 2021, was $51,120. The BOE classified the subject property as residential and independently determined the TVM on January 1, 2021, was $51,120.
- Complainant’s Evidence. Complainant testified the TVM of the subject property on January 1, 2021, was $25,000. Based on Complainant’s evidence, Complainant’s argument is Respondent’s mass appraisal methods did not take his individual home’s features into account and the increase in value was not supported by the condition of the property. Complainant testified the home has been uninhabited for over four years and is in disrepair. The condition issues include no plumbing or electricity and black mold. Complainant testified he has not listed the property for sale nor received any bids for potential repairs. There was no evidence presented that Complainant is a licensed appraiser or a person possessing appraisal training.
Complainant submitted Exhibits 1- 50, which were admitted into evidence. Exhibits 1-6 include the BOE decision, complaint for review forms, the subject property record card and property information from Complainant. Exhibits 7-21 are pictures of the subject property. Exhibits 22-44 are some comparable home listings and sales (from yahoo.com) and photographs and some more various pictures of the subject property. Complainant’s Exhibits 45-48 are the property record card and BOE meeting minutes for the subject property. Exhibit 49 is a letter regarding Complainant’s accounting of a conversation about the value of the manufactured home from the salesman of the manufactured home on the subject property, Mr. Pitts. Complainant submitted a recording of a meeting with the Assessor as Exhibit 50.
- Respondent’s Evidence. Respondent submitted Exhibit A, a packet which includes the Property Record Cards for the subject property and comparable properties and recent sales or listings of the comparable properties, which were admitted into evidence. The assessments shown are within a mile of the subject property. There was no adjustment made for differences between the properties and the subject property. Although admitted into evidence, the information within Exhibit A is given the weight deemed appropriate.
- Value. The TVM of the subject property on January 1, 2021, was $51,120.
CONCLUSIONS OF LAW
- Assessment and Valuation
Pursuant to Article X, Sections 4(a) and 4(b), Mo. Const. of 1945 real property and tangible personal property is assessed at its value or such percentage of its value as may be fixed by law for each class and for each subclass. Article X, Sections 4(a) and 4(b), Mo. Const. of 1945. 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). “True value in money is the fair market value of the property on the valuation date, and is a function of its highest and best use, which is the use of the property which will produce the greatest return in the reasonably near future.” 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). Determining the TVM is a factual issue for the STC. Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008). The “proper methods of valuation and assessment of property are delegated to the Commission.” Savage v. State Tax Comm’n, 722 S.W.2d 72, 75 (Mo. banc 1986).
“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; see also St. Louis Cty. v. Sec. Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977).
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
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). The finder of fact in an administrative hearing determines the credibility and weight of expert testimony. Hornbeck v. Spectra Painting, Inc., 370 S.W.3d 624, 632 (Mo. banc 2012). “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 BOE’s valuation is presumptively correct. Rinehart v. Laclede Gas Co., 607 S.W.3d 220, 227 (Mo. App. W.D. 2020). To prove overvaluation, a taxpayer must rebut the BOE’s presumptively correct valuation and prove the “value that should have been placed on the property.” Snider, 156 S.W.3d at 346. The taxpayer’s evidence must be both “substantial and persuasive.” 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, 722 S.W.2d at 77 (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”). A taxpayer does not meet his burden if evidence on any essential element of his case leaves the STC “in the nebulous twilight of speculation, conjecture and surmise.” See, Rossman v. G.G.C. Corp. of Missouri, 596 S.W.2d 469, 471 (Mo. App. 1980).
- Complainant Did Not Prove Overvaluation.
Complainant testified the subject property’s value is $25,000. Complainant’s Exhibits and testimony indicate the subject property is in disrepair. Complainant testified that the property is uninhabited, with no plumbing or electricity and black mold. Complainant submitted multiple pictures of the home’s condition. Complainant testified he has not listed the property for sale, has done no appraisal and has had no construction bids for repair in order to determine any actual costs for repair for comparison. Although Complainant’s evidence regarding the subject property’s condition was factual, the evidence did not provide any market-based value on the needed repairs or provide any market basis for deducting the cost of the needed repairs. Complainant’s testimony about the condition of the property does not provide substantial and persuasive evidence that the valuation of the BOE was incorrect.
Complainant supports his assertion that the property is valued at $25,000 with his Exhibits 22-44, which include comparable assessments and listings or sales prices of homes he found, in his opinion, to be similar to the subject property.
Complainant relies largely on the similar sized lot nearby, which the Assessor valued at $25,520 for 2021. (See Exhibits 41 through 44). The property has a trailer on it that is similar in size and in similar condition. (See Exhibits 41 through 44). The lot is classified residential, has a similar shed, and has well access, which the subject property does not have. (See Exhibits 41 through 44). Although reasonable to assume that two similar properties should be valued similarly, comparative assessment is not the method used to find a TVM for a property. For residential properties, the comparable sales approach is the method most commonly used to determine the TVM of a subject 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’s assertion that one property’s assessment (Exhibits 41 through 44) should be used to correct another property’s assessment is not substantial and persuasive evidence that the BOE value is incorrect for the subject property. There is no correlation between the two properties except that they were both in fact assessed by Respondent. Complainant made no adjustments for differences between that property and the subject property nor presented any appraisal to support Complainant’s assertion that the subject property’s value determination by the BOE was incorrect. 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]”).
Exhibits 22-40 of Complainant do not account for differences between the comparable sales or listings and the subject property. 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). In fact, Complainant did not use any adjustments for any other properties in Exhibits 22-40. The sum total of data submitted by Complainant is simply assessments and listings or raw sales data of comparable properties. Complainant’s evidence does not make adjustments to comparable properties to find a proper appraisal comparison. Therefore, all of the comparable home data and proposed valuations submitted in Complainants Exhibits is both speculative and incomplete (see Exhibit 22 -40).
The assertions within Complainant’s Exhibits and testimony, which discuss Respondent’s errors in methodology and alleged unprofessional behavior, are not substantial and persuasive evidence that the BOE’s valuation of the subject property is erroneous. General assertions about the short-comings of the methodology of Respondent and how such methodology causes increases to certain properties do not speak specifically as to the TVM of the subject property.
Although not required given the burden of proof, Respondent presented Exhibit A and testified that the data in Exhibit A supported the BOE’s valuation of the subject property.
CONCLUSION AND ORDER
The BOE decision is affirmed. The TVM of the subject property as of January 1, 2021, was $51,120 with an assessed value of $9,710.
Application for Review
A party may file with the Commission 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, 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 Hickory 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.
SO ORDERED December 31, 2021.
STATE TAX COMMISSION OF MISSOURI
Erica M. Gage
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 December 31, 2021, to: Complainant(s) and/or Counsel for Complainant(s), the County Assessor and/or Counsel for Respondent and County Collector.
Elaina Mejia
Legal Coordinator
[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, Section 14; section 138.430.1, RSMo 2000. All statutory citations are to RSMo 2000, as amended.