State Tax Commission of Missouri
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ST CHARLES CINE LLC, |
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Complainant, |
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Appeal(s) Number 11-32951 |
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SCOTT SHIPMAN, ASSESSOR, |
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ST. CHARLES COUNTY, MISSOURI, |
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Respondent. |
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DECISION AND ORDER
HOLDING
Decision of the St. Charles County Board of Equalization sustaining the assessment made by the Assessor is SET ASIDE.Complainant presented substantial and persuasive evidence to rebut the presumption of correct assessment by the Board of Equalization.
True value in money for the subject property for tax years 2011 and 2012 is set at $4,500,000, commercial assessed value of $1,440,000.
Complainant appeared by Counsel Paul Woody, Blitz, Bardgett & Deutsch, LC, St. Louis, Missouri.
Respondent appeared by Counsel, Amanda Jennings, Assistant County Counselor.
Case heard and decided by Senior Hearing Officer W. B. Tichenor.
ISSUE
Complainant appeals, on the ground of overvaluation,[1] the decision of the St. Charles County Board of Equalization, which sustained 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, 2011.[2]The Hearing Officer, having considered all of the competent evidence upon the whole record and the briefs of parties 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 St. Charles County Board of Equalization.
2.Evidentiary Hearing.The Evidentiary Hearing was held on November 6, 2013, at the St. Charles County Administration Building, St. Charles, Missouri.
3.Transcript & Filing of Briefs.The Transcript was received by the Commission on 11/20/13.By email dated 11/22/13 Respondent requested to be able to brief the case.Briefs of both parties were received by the Commission on 1/3/14.Complainant’s Reply Brief was filed with the Commission on 1/31/14.Respondent’s Response Brief was received by the Commission on 2/4/14.
4.Identification of Subject Property.The subject property is identified by map parcel number 3-0116-0165-00-4 and Assessor’s Account Number 433440A000.It is further identified as being located at 1830 South First Capital Drive, St. Charles, Missouri.[3]
5.Description of Subject Property.The subject property consists of a 15.26/15.27[4] acres site, improved by an 18 screen movie theatre with supporting amenities.A detailed description of the property under appeal was provided by each appraiser.[5]It is otherwise known as the St. Charles 18 Cine.
6.Assessment.The Assessor appraised the property at $8,905,370, an assessed commercial value of $2,849,720.The Board of Equalization sustained the assessment.[6]
7.Complainant’s Evidence.Complainant offered the following evidence the appraisal (Exhibit A) and written direct testimony (Exhibit B) of Thomas H. Slack.No objections or rebuttal exhibits were filed to Exhibits A & B, both were received into evidence.[7]
8.Respondent’s Evidence.Respondent offered the following evidence:
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EXHIBIT |
DESCRIPTION |
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Appraisal Report Keith D. McFarland |
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Aerial Photograph – Subject Property |
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Professional Qualifications – Keith A. Hodges |
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Written Direct Testimony – Keith A. Hodges |
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Written Direct Testimony – Keith D. McFarland |
9.Objections to Respondent’s Exhibits.Objections were filed to Exhibits 1, 2, 4 & 5.By Order dated 9/11/13, the Hearing Officer ruled that objections to Exhibits 1 & 5 went to weight and not admissibility; objections to exhibits 2 and 4 were overruled.Exhibit 4 constituted nothing more than reporting of the values placed on the subject property under the Assessor’s mass valuation for the assessment cycle 2011 – 12 and no probative weight could be accorded to the reported value in ascertaining the fair market value as of 1/1/11 for the Complainant’s property.[8]
10.Exhibit 4 Non-Probative.Exhibit 3 failed to qualify Mr. Hodges as an expert in the appraisal of movie theaters.Mr. Hodges rendered no opinion of value in Exhibit 4 as to his opinion as an appraiser of the fair market value of the subject property as of 1/1/11.Mr. Hodges only reported the appraised value assigned to the property by the office of the Assessor for the 2011-12 assessment cycle.Accordingly, Exhibit 4 not containing the opinion of an expert witness as to the fair market value of the subject property as of 1/1/11 it has no probative value in the appeal.
11. No Evidence of New Construction & Improvement.There was no evidence of new construction and improvement from January 1, 2011, to January 1, 2012, therefore the assessed value established by this Decision for 2011 remains the assessed value for 2012.[9]
12.Summary of Slack Appraisal.Mr. Slack developed the three recognized approaches to valuation – cost, sales comparison and income.He concluded a value under the cost approach of $4,520,000.[10]The value determined using the sales comparison methodology was $4,500,000.[11]The income approach resulted in an indicated value of $4,530,000.[12] The reconciled conclusion of value placed primary reliance on the sales comparison approach to arrive at a value of $4,500,000.[13]
13.Summary of McFarland Appraisal.Mr. McFarland developed the income and sales comparison approaches.The value concluded under the sales comparison approach was $8,200,000.[14]The income approach developed an indicated value of $8,300,000.[15]Mr. McFarland’s reconciliation and conclusion of value gave primary reliance to the income approach and determine a value of $8,300,000.
14.Presumption of Correct Assessment Rebutted.Complainant’s evidence presented a prima facie case to rebut the presumption of correct assessment and establish a value of $4,500,000.Respondent’s evidence, likewise, presented a prima facie case to rebut the presumption of correct assessment and establish a value of $8,300,000.See, Presumption In Appeal, infra.
15.Expertise of Complainant’s Appraiser.[16]Thomas Slack has thirty years of experience as a professional real estate appraiser.He has performed 800 to 1,200 appraisals in his career.He has specific and significant experience in valuing movie theater properties of all sizes throughout the nation.This experience includes serving as a consultant to AMC Theaters relating to the valuation of their properties in ten states.This work requires him to be knowledgeable of trends in the industry which affect the value of theater properties.The approaches he applied, and the adjustments he made, were based on, and utilized, his extensive experience valuing movie theaters.The appraisal and testimony provided by Mr. Slack were grounded upon a substantial foundation of the knowledge of and experience with the movie theater business and how it relates to the value of theater properties.
16.Expertise of Respondent’s Appraiser.Mr. McFarland has been a commercial real estate appraiser for 26 years.His appraisal experience is in a range of various types of properties.No prior experience in the appraisal of a movie theater was provided in the direct testimony or his qualifications.[17]
17.Market Trend Factors and Issues in the Theater Industry.[18]Complainant’s appraiser established a significant number and variety of factors that directly and negatively affected the valuation of the property under appeal.Attendance at theaters nationwide declined 6.4% in 2010, continuing a trend from at least 2006.The subject property’s decline was 11.7% from 2009 to 2010 and approximately 40% between 2003 and 2010.A decline in attendance impacts the property value greater than it does the value of the business because expenses related to the property remain relatively fixed.Decline in attendance brought about by competition from other means of delivering movies to viewers (such as DVD;s Netflix and On-Demand) and a decline in the number and quality of movies being produced by the major studios has brought about a change in what is viewed as the optimal design of movie theaters and the manner in which brick and mortar theaters deliver movies.
Theaters are now smaller, both in number of screens within a property and in square footage per screen.The trend is to replace 1980’s and 1990’s vintage screens with six to ten screen dine-in theaters, or they are replaced with traditional theaters of 10 to 12 screens.The number of seats per screen has also shrunk as owners have gone to either stadium or dine-in seating.The prototype theater property which the market desired in 2011 was approximately 45,000-60,000 square feet in size with 12-14 screens and less than 2,000 seats overall.This compares to the subject with its 86,848 gross square footage, 18 screens and 3,435 seats as of 1/1/11.In addition to changes in configuration of seating, technological changes in projecting movies digitally has virtually eliminated the need for mezzanine space for projection rooms.Changes in overall design and in the common areas, as well as materials used in construction, also reduce the overall area for the theaters and the costs associated with operating and maintaining them.
The subject property was built for a completely different theater market.Therefore, it suffers from functional and economic obsolescence due to its size, number of screens and total seating capacity.There is further obsolescence from the subject having been constructed in two stages, first as a 10 screen theater and then being expanded to 18 screens in order to compete in the late 1990’s with 20-30 megaplex theaters.This two stage construction results in economic inefficiencies in its layout.
18.Conclusion of Value.The true value in money of the subject as of 1/1/11 is $4,500,000, commercial assessed value of $1,440,000.See, Complainant Proves Value, infra.
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.
Basis of Assessment
The Constitution mandates that real property and tangible personal property be assessed at its value or such percentage of its value as may be fixed by law for each class and for each subclass.[20]The constitutional mandate is to find the true value in money for the property under appeal. By statute real and tangible personal property is assessed at set percentages of true value in money.[21]
Presumption In Appeal
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.[22]This presumption is a rebuttable rather than a conclusive presumption.It places the burden of going forward with some substantial evidence on the taxpayer – Complainant.When some substantial evidence is produced by the Complainant, “however slight”, the presumption disappears and the Hearing Officer, as trier of facts, receives the issue free of the presumption.[23]The presumption is not evidence of value.
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. Likewise, in those instances, such as this, where the Respondent is advocating a value less than that determined by the Board, for purpose of considering the value proposed by Respondent, the presumption is rebutted when the assessor presents substantial and persuasive evidence to establish the Board’s valuation is erroneous and what the fair market value should have been placed on the property.[24]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[25]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.[26]
Complainant’s evidence, standing on its own, met the required standard to both rebut the presumption of correct assessment and establish the value of $4,500,000 proposed.Respondent’s evidence, standing on its own, met the required standard to both rebut the presumption of correct assessment and establish the value of $8,300,000 proposed.Accordingly, the presumption of correct assessment by the Board was rebutted.The matter of a determination of value will be addressed later in the appeal. See, Complainant Proves Value, infra.
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.[27]True value in money is defined in terms of value in exchange and not value in use.[28]It is the fair market value of the subject property on the valuation date.[29]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.[30]
Both appraisers performed their appraisals under the Standard For Valuation.[31]
Weight to be Given Evidence
The Hearing Officer is not bound by any single formula, rule or method in determining true value in money, but is free to consider all pertinent facts and estimates and give them such weight as reasonably they may be deemed entitled.The relative weight to be accorded any relevant factor in a particular case is for the Hearing Officer to decide.[32]
The Hearing Officer as the trier of fact may consider the testimony of an expert witness and give it as much weight and credit as he may deem it entitled to when viewed in connection with all other circumstances.The Hearing Officer is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe[33] all or none of the expert’s testimony and accept it in part or reject it in part.[34]In this instance, the Hearing Officer is persuaded that the conclusion of value presented by Mr. Slack being based on the appropriate methodology for the valuation of the subject property is to be given full weight and credit.See, Methods of Valuation, Opinion Testimony by Experts, & Complainant Proves Value, infra.
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.[35]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.[36]The evidence in this appeal supports the utilization of the sales comparison and income approaches as developed and presented by Mr. Slack, relying on a per screen unit of value. See, Opinion Testimony by Experts & Complainant Prove Value, infra.
Opinion Testimony by Experts
If specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert on that subject, by knowledge, skill, experience, training, or education, may testify thereto.
The facts or data upon which an expert bases an opinion or inference may be those perceived by or made known to the expert at or before the hearing and must be of a type reasonably relied upon by experts in the field in forming opinions or inferences upon the subject and must be otherwise reliable, the facts or data need not be admissible in evidence.[37]
Both Mr. Slack and Mr. McFarland are qualified by knowledge, skill, experience, training and education to appraisal commercial property in general.However, this appeal presents the somewhat unusual circumstance of one appraiser having significantly greater experience in the valuation of movie theaters and the other appraiser having no such similar experience.[38]The data upon which Mr. Slack formed his opinions of value were of the type that would be reasonably relied upon by experts in valuing movie theaters.Furthermore, that data was and is deemed to be otherwise reliable.
[39]See, Complainant Proves Value, infra.
Complainant Proves Value
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, 2011.[40]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.”[41]A valuation which does not reflect the fair market value (true value in money) of the property under appeal is an unlawful, unfair and improper assessment.The evidence presented on behalf of Complainant established the fair market value of the subject property to be significantly less than that set by the Assessor and sustained by the Board, accordingly, the Assessor/Board valuation not being reflective of fair market value was an unlawful, unfair and improper assessment.Complainant’s evidence was substantial and persuasive to both rebut the presumption of correct assessment by the Board and establish the fair market value of the property to be $4,500,000 as of 1/1/11.
Rational for Conclusion of Value
The Hearing Officer was presented with two appraisals.Both had been prepared by individuals who are state certified and experienced appraisers.Each appraisal was developed in accordance with USPAP.[42]Each appraisal considered in a vacuum would have met the evidentiary standard to conclude the true value in money at the value each appraiser determined.Often in cases such as this when two appraisers present a different opinion of value, it is reasonable to simply rest on the middle ground, give equal weight to each appraisal and simply establish the value as the average of the two opinions.However, this is not such an instance.Based upon both the Hearing Officer’s original pre-hearing review of both the Slack & McFarland appraisals and supporting testimony and the further post-hearing re-review of those Exhibits, the reading of the testimony both prior to and after the hearing, the testimony at hearing and the briefs of both counsels, the Hearing Officer is persuaded with a high level of certainty of the overall validity and strength of the methodology, reasoning and documentation provided in the Slack appraisal.
There exists a significant difference in the two appraisals in the evidentiary record.The Slack opinion of value was based on a value per screen unit of value.The McFarland opinion of value was based on a gross per square footage area.This difference is the critical basis upon which the conclusion of value must rest.
Slack Appraisal Persuasive
The evidence is that both historically and in the current market price per screen and attendance per screen are the factors for a determination of sales price for theater properties.Mr. Slack established that in valuing a movie theater by the sales comparison approach the market looks to a dollar value per screen.Likewise, market rent per screen is the standard under the income approach when valuing a movie theater.The problem with using area as the unit of value, as Mr. McFarland did, is that total area does not have any direct correlation or necessary relevance to the value of the property nor to the income which could be produced by the owner of the property.
Contrary to the conclusions of the Respondent’s appraiser, the subject’s larger total area actually decreases its value.A theater with more total area does not necessarily have a higher value than a theater with less total area, nor would the larger theater necessarily command a higher rental value or a higher price in a sale.The number of screens is the critical factor that has a direct impact on the value.However, a larger number of screens does not equate to a higher value.Using area as the unit of value for the property under appeal, exacerbates the potential that an area unit of value will give value to non-income producing areas of the property.This is especially true given the subject’s outmoded design, it being built in two stages and the excess mezzanine area.The large square footage of the Complainant’s property is more of a problem than an asset, because of the subject’s design.Because of the faulty design, the area per screen was inflated to approximately 5,000 square feet per screen without the addition of value or attendance capacity that would exist in a theater that was better designed.The subject’s excess area per screen simply does not contribute to the actual potential attendance per screen or the income-producing potential for each screen.
The Slack appraisal considered and developed all three approaches to value.The cost approach was disregarded.He relied primarily on the sales comparison approach.His sales comparison approach considered six fee simple sales and one leased fee sale of theater properties relevant in time to the 1/1/11 valuation and one 2011 listing.There were no recent fee simple sales in the St. Louis area so it was necessary to consider sales within the larger Midwest region, which encompassed properties in Springfield (Mo.), Wichita, Oklahoma City, Andover (Minn.), Omaha, and Appleton (Wis.).
Adjustments were made address differences in markets, locations, size and design, age, condition, land to building ratio and interest transferred.The indicated adjusted values essentially fell into a range of less than $225,000 to over $300,000 per screen.Mr. Slack concluded a per screen unit value for the subject of $250,000 or $4,500,000 for the subject 18 screen facility.
The appraiser also developed the income approach.The existing lease on the subject was not utilized as it was between related parties, exceeded market rents on the date of valuation, and did not contemplate the decline in theater attendance that occurred with the subject.The Slack income approach was based on leases and market information indicating that rents were based as a percentage of gross revenue ranging from eight to twelve percent of revenue.A conclusion of market rent of approximately $31,000 per screen was determined.Adjustment for vacancy and credit loss and a deduction for applicable operating expenses were made.These were based on some items of actual operating expenses and some of projections based on knowledge of the market.A capitalization rate of 10% before adjustment for real estate taxes was utilized based on consideration of market surveys for retail properties and comparable capitalization rates from movie theater sales.
The Slack methodology of defining unit value on a per screen basis properly reflects the valuation of theater properties by the market.Accordingly, the appraisal established an accurate value of the subject property as of 1/1/11 of $4,500,000.
McFarland Appraisal Not Persuasive
The initial matter of concern confronting the Hearing Officer with regard to the conclusion of value reached by Mr. McFarland is the fact that his level of expertise in the valuation of a movie theater simply does not rise to that of Mr. Slack.This is not to otherwise call into question his overall expertise as a commercial real estate appraiser.[43]However, in this instance the appraisal of a movie theater is in a category that does not necessarily readily and easily translate to other types of commercial properties for purposes of an evidentiary hearing.The lack of actual appraisal experience possessed by Respondent’s appraiser with regard to movie theaters gives significant probative weight to the Complainant’s appraisal due to the far superior appraisal experience that Mr. Slack brought to the table.The lack of knowledge and experience in the valuation of movie theaters results in Mr. McFarland not discussing nor accounting for the trends in the movie theater industry which clearly impact upon the valuation of such properties.
The other and more serious factor which weighs against the conclusion of value by Mr. McFarland is his determination that participants in the movie theater market value properties based on area, rather than on a per screen basis.Because of a lack of appreciation of the market trend and preferences in terms of theater size and configuration, the appraiser made no adjustments to his rent comparables under his income approach or to his sales in the sales comparison approach to account for the inefficiencies and obsolescence in design of the subject property.As a result of erroneously relying on a unit value approach tied to area, the indicated value of the subject was grossly overestimated by both of the McFarland approaches.
As developed by Counsel for Complainant during cross-examination of Mr. McFarland and addressed in Complainant’s Brief, if the appraiser had properly utilized the per screen unit value the indicated value under the income approach would have been $5,200,000 and $5,400,000 under the sales comparison approach.These indicate values do not include necessary downward adjustments for the inefficiencies in design of the subject, which would of necessity drive the indicated values even lower.Once such adjustments would be made, the variance between the per square foot unit of value and the per screen unit value would be even greater.More importantly, once those adjustments were made the two indicate values would come significantly closer to the values concluded by Complainant’s appraiser, so as to render the actually difference in a reconciled value as to be essentially de minimis.
For all the forgoing reasons, when weighed against the Slack appraisal, no probative weight can be given to the valuation proposed by Respondent for the subject property.
Briefs
The Hearing Officer has read, reviewed and considered the Post-Hearing Briefs submitted by both learned Counsels.Both attorneys have presented their arguments and the positions of their respective clients in well written documents.The Hearing Officer will not further burden this Decision by reiterating the arguments advance on each side and the rejoinders made.Suffice it to say, the evidence, as discussed above, bolstered by the arguments and responses presented by Counsel for Complainant were sufficient to provide a clear basis and foundation to persuade the Hearing Officer relative to his determination and conclusion of value for Complainant’s property.
ORDER
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 2011 and 2012 is set at $1,440,000.
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.
Failure to state specific facts or law upon which the application for review is based will result in summary denial. [44]
Disputed Taxes
The Collector of St. Charles 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 April 9, 2014.
STATE TAX COMMISSION OFMISSOURI
W. B. Tichenor
Senior Hearing Officer
[1] The ground of Discrimination was market on the Complaint for Review of Assessment.However, no evidence was tendered by Complainant that would establish a prima facie case of discrimination or inequitable assessment.According, the claim of Discrimination was deemed to have been abandoned.Tr. 3:1-5.
[2] The value as of 1/1/11 remains the value as of 1/1/12 unless there is new construction and improvement to the property.Section 137.115.1 RSMo
[4] Complainant’s Appraiser identified the land area as being 15.26 acres (664,726 square feet);Respondent’s Appraiser identified the land area as being 15.27 acres (665,121 square feet) – the difference of 395 square feet is of no consequence in the appeal.
[5] Exhibit A – pp. 17-18 & Addendum 1 – Property Characteristics;Exhibit B – Q & A 28;Exhibit 1 – pp. 35-45; Exhibit 5 – Q & A 23
[17] Exhibit 1 – Exhibit A-Qualifications; Exhibit 5 – Q & A 8.It appears that the only prior appraisal that involved a movie theater was as a part of the appraisal of a shopping center – Tr. 74:10-11.
[18] Exhibit A – Movie Theatre Market Analysis, pp.14-15; Market Value Issues, pp. 16-17; Tr. 50:3 – 52:7
[21] Section 137.115.5, RSMo – residential property at 19% of true value in money; commercial property at 32% of true value in money and agricultural property at 12% of true value in money
[22] 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)
[23] United Missouri Bank of Kansas City v. March, 650 S.W.2d 678, 680-81 (Mo. App. 1983), citing to State ex rel. Christian v. Lawry, 405 S.W.2d 729, 730 (Mo. App. 1966) and cases therein cited.
[24] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959)
[25] See, Cupples-Hesse, supra.
Substantial and persuasive evidence is not an extremely high standard of evidentiary proof.It is the lowest of the three standards for evidence (substantial & persuasive, clear and convincing, and beyond a reasonable doubt).It requires a small amount of evidence to cross the threshold to rebut the presumption of correct assessment by the Board.The definitions, relevant to substantial evidence, do not support a position that substantial and persuasive evidence is an extremely or very high standard.
“Substantial evidence: Evidence that a reasonable mind would accept as adequate to support a conclusion; evidence beyond a scintilla.”Black’s Law Dictionary, Seventh Edition, p. 580
The word scintilla is defined as “1. a spark,2. a particle; the least trace.” Webster’s New World Dictionary, Second College Edition.Black’s definition at 1347 is “A spark or trace <the standard is that there must be more than a scintilla of evidence>.”There must be more than a spark or trace for evidence to have attained the standard of substantial.Once there is something more than a spark or trace the evidence has reached the level of substantial.Substantial evidence and the term preponderance of the evidence are essentially the same.“Preponderance of the evidence.The greater weight of the evidence; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”Black’s at 1201Substantial evidence is that a reasonable mind would accept as adequate to support the conclusion.Preponderance is sufficient to incline a fair and impartial mind to one side of the issue rather than the other, i.e. support the proposed conclusion.
[27] 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)
[28]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)
[30] 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.
[32] St. Louis County v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977); St. Louis County v. STC, 515 S.W.2d 446, 450 (Mo. 1974); Chicago, Burlington & Quincy Railroad Company v. STC, 436 S.W.2d 650 (Mo. 1968)
[33] Belief in this setting has nothing to do with the truthfulness of one expert over another.The Hearing Officer has no issue with the veracity of either Mr. Slack or Mr. McFarland. He consideres both to have testified based upon their personal, bona fides conclusions.Belief, in this context, is anchored in whether the methodology employed by a given expert is deemed to be the most reliable for the given appraisal problem.In this case, the Slack methodology is appropriate and reliable for the valuation of the subject movie theater.
[34] St. Louis County v. Boatmen’s Trust Co., 857 S.W.2d 453, 457 (Mo. App. E.D. 1993); Vincent by Vincent v. Johnson, 833 S.W.2d 859, 865 (Mo. 1992); Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. 1991); Curnow v. Sloan, 625 S.W.2d 605, 607 (Mo. banc 1981)
[35] 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).
[36] 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).
[37] Section 490.065, RSMo; State Board of Registration for the Healing Arts v. McDonagh, 123 S.W.3d 146 (Mo. SC. 2004); Courtroom Handbook on Missouri Evidence, Wm. A. Schroeder, Sections 702-505, pp. 325-350; Wulfing v. Kansas City Southern Industries, Inc., 842 S.W.2d 133 (Mo. App. E.D. 1992).
[38] Hearing Officer acknowledges that Mr. McFarland testified in his redirect (Tr. 74:10-11) that he had appraised his Rent Comp 4 along with a shopping center.Since there was no listing of movie theaters as a category of commercial property appraised by the appraiser, the Hearing Officer is lead to conclude that as far as an appraisal on a free standing facility, the appraisal of the subject is the first such movie theater that he has appraised.
[41] 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)