State Tax Commission of Missouri
STAHL SPECIALTY CO. LLC,)
v.) Appeal(s) Number 10-63001 & 10-63002
MARK REYNOLDS, ASSESSOR,)
JOHNSON COUNTY, MISSOURI,)
DECISION AND ORDER
Decisions of the Johnson County Board of Equalization sustaining the assessments made by the Assessor are SET ASIDE.
True value in money for the subject property in Appeal No. 10-63001 for tax year 2010 is set at $400,400, assessed commercial value of $128,130.
True value in money for the subject property in Appeal No. 10-63002 for tax year 2010 is set at $1,139,600, assessed commercial value of $364,670.
Complainant appeared by Counsel, Cathy Steele, Law Office of Cathy Steele, P.C., Clayton, Missouri.
Respondent appeared by Johnson County Prosecuting Attorney, Lynn M. Stoppy.
Case decided by Senior Hearing Officer W. B. Tichenor.
Complainant appeals, on the ground of overvaluation, the decisions of the Johnson County Board of Equalization, which sustained the valuations of the subject properties.The Commission takes this appeal to determine the true value in money for the subject properties 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 Johnson County Board of Equalization.Evidentiary Hearing was waived and the case was submitted for decision, on June 15, 2011, upon the exhibit and written direct testimony submitted by Complainant
The property in Appeal 10-63001 represents 26% of the assessor’s total appraised value of the two properties.The property in Appeal 10-63002 represents 74% of the assessor’s total appraised value of the two properties.
3.Subject Property.The subject properties in both appeals are located at 1301 Stahl Drive, Warrensburg, Missouri.Complainant operates the properties as a supplier to the automotive and heavy truck industries.The property in Appeal 10-63001 is identified by map parcel number 11-40-18-10.03.The property in Appeal 10-63002 is identified by map parcel number 11-40-18-3-1-8.The two properties comprise a tract of land consisting of 14.77 acres.The land is improved by a manufacturing facility, consisting of a 170,825 square foot building, constructed from 1960 – 2001.A detailed description of this property with photographs is found in Exhibit A – Property Data, pp. 1 – 12.The two tracts comprise a single economic unit.
4.Complainant’s Evidence.Complainant presented the appraisal report of Jason Roos and Laird Goldsborough, State Certified General Real Estate Appraisers, Shaner Appraisals, Inc., and the written direct testimony of Mr. Goldsborough.The appraisal was prepared in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice (USPAP).The appraisers valued the two properties under the sales comparison approach and concluded a combined value of $1,540,000.
Complainant’s evidence was 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 for the combined properties to be $1,540,000.
5.Respondent’s Evidence.Respondent did not file and exchange any exhibits or written direct testimony in the appeals.
6.Allocation of Value.The concluded value of $1,540,000 will be allocated as follows: Appeal 10-63001 – $400,400 (26% of total value), assessed commercial value of $128,130; Appeal 10-63002 – $1,139,600 (74% of total value), assessed commercial value of $364,670.
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
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.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.In an overvaluation appeal, true value in money for the property being appealed must be determined based upon the evidence on the record that is probative on the issue of the fair market value of the property under appeal.The only evidence on the record in this appeal that is probative on the issue of the fair market value of the property under appeal consists of the Roos/Goldsborough appraisal and written direct testimony of Mr. Goldsborough, Complainant’s expert witness.Accordingly, consistent with the constitutional mandate, the Hearing Officer must find the true value in money for the subject property based upon those sources.
Presumption In Appeals
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.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.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.Upon presentation of the Complainant’s evidence the presumption in this appeal disappeared.The case is decided free of the presumption.
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.Complainant’s appraiser considered the cost and income approaches to value but elected not to develop either.The valuations for the properties under appeal were concluded under the sales comparison approach to value.The Hearing Officer concurs that neither the cost approach, nor the income approach would have presented reliable indicators of value for the present appraisal problem.The sales comparison approach was appropriate to conclude values for the two properties.
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.
Laird Goldsborough was qualified by his knowledge, skill, experience, training and education to testify as an expert on the subject of the fair market value of the subject property as of January 1, 2009.The facts and data upon which Mr. Goldsborough based his opinion of value were of a type reasonably relied upon by experts in the appraisal of real estate and they are found to be otherwise reliable.Therefore, the opinion of value concluded by the appraiser was competent and relevant evidence on the issue before the Hearing Officer on the fair market value of the property under appeal.
Complainants Prove 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, 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 evidence of value tendered by Complainant met the standard of substantial and persuasive.
The appraisal evidence in these appeals was especially compelling.The appraisers went to great lengths to conduct their background investigation in preparation for addressing the appraisal problem.An in-depth Market Analysis was provided in narrative form. The Highest and Best Use Analysis was well presented and consisted of specific information and conclusions, not just a recitation of the four elements, as is sometimes presented to the Commission in less persuasive appraisal reports.The Discussion of Sales was quite informative. Likewise the Ranking Analysis provided the Hearing Officer with a clear understanding of the process of evaluation which the appraisers had done to conclude the values for each property.
In an appeal such as this where the appraisal presented on behalf of Complainant was prepared in accordance with the standards and requirements of USPAP.Where there is no countervailing or rebuttal evidence placed against the Complainant’s conclusion of value as established by the submitted appraisal report and the supporting testimony, the Hearing Officer foregoes any detailed analysis of the appraisal.Any such analysis would serve no useful purpose, as a reading of Exhibits A and B provides no basis upon which the Hearing Officer could have reasonably and logically rejected the conclusions of value reached.
For all of the foregoing reasons, the Hearing Officer is persuaded that the values concluded under the sale comparison approaches developed for each property provide an appropriate basis for the determination of value in this case.
Complainant’s evidence met the required standard and established the fair market value of the property in Appeal 10-63001 to be: $400,400, commercial assessed value of $128,130.
Complainant’s evidence met the required standard and established the fair market value of the property in Appeal 10-63002 to be: $1,139,600, commercial assessed value of $364,670.
The assessed valuations for the subject properties as determined by the Assessor and sustained by the Board of Equalization for Johnson County for the subject tax day are SET ASIDE.
The assessed value for the subject property in Appeal 10-63001 for tax year 2010 is set at $128,130.
The assessed value for the subject property in Appeal 10-63002 for tax year 2010 is set at $364,670.
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.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 Johnson 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.If no Application for Review is filed with the Commission within thirty days of the mailing date set forth in the Certificate of Service, the Collector, 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.
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 July 20, 2011.
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 20thday of July, 2011, to:Cathy Steele, 225 South Meramec, Suite 511, Clayton, MO 63105, Attorney for Complainant; Lynn Stoppy, Prosecuting Attorney, Johnson County Justice Center, 101 W. Market, Warrensburg, MO 64093, Attorney for Respondent; Mark Reynolds, Assessor, 300 North Holden, Suite 204; Diane Thompson, Clerk, 300 North Holden, Suite 205; Ruthane Small, Collector, 300 North Holden, Suite 201, Warrensburg, MO 64093.
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).
 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).
 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).