Steven Kushner & Kathleen Dolan v. Jake Zimmerman, Assessor St. Louis County

June 14th, 2018

STATE TAX COMMISSION OF MISSOURI

 

STEVEN E. KUSHNER & KATHLEEN M. DOLAN )

)

 
  )  
              Complainants, )  
  )  
v. ) Appeal No. 17-10119
  )

)

Parcel/Locator No.

20T540491

JAKE ZIMMERMAN,  ASSESSOR, )  
ST. LOUIS COUNTY, MISSOURI,

Respondent

)

)

 

 

DECISION AND ORDER

 

HOLDING

 

The decision of the St. Louis County Board of Equalization (BOE) is AFFIRMED.  Complainants Steven E. Kushner and Kathleen M. Dolan did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE.

Steven E. Kushner (Complainant) appeared pro se; Kathleen M. Dolan did not appear.

Respondent Jake Zimmerman, Assessor, St. Louis County, Missouri, (Respondent) appeared by counsel Steve Robson.

Case heard and decided by Senior Hearing Officer Amy S. Westermann (Hearing Officer).

ISSUE

Complainant appealed on the ground of overvaluation.  Respondent initially set the true value in money (TVM) of the subject property at $376,500, as residential property, as of January 1, 2017.  The BOE valued the subject property at $376,500, thereby sustaining Respondent’s valuation.  The State Tax Commission (STC) takes this appeal to determine the TMV for the subject property as of January 1, 2017.

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.
  2. Evidentiary Hearing. The issue of overvaluation was presented at an evidentiary hearing on March 29, 2018, at the St. Louis County Government Building, 41 South Central Avenue, Clayton, Missouri.
  3. Identification of Subject Property. The subject property is identified by parcel/locator number 20T540491.  It is further identified as 16245 Wilson View Estates Drive, Chesterfield, St. Louis County, Missouri.  (Complaint; Exhibit 3)
  4. Description of Subject Property. The subject property consists of approximately .29 acre (12,632 square feet) improved by a 2,193 square foot, two-story, single family home built in approximately 1995.  (Exhibit 3)  The subject property includes four bedrooms; two full bathrooms; one half bathroom; a 1,634 square foot basement with 1,050 square feet of finished area; a two-car garage; a front porch, a deck, and a patio; and one fireplace.  (Exhibit 3) The exterior consists of masonry and frame construction.  (Exhibit 3)  The subject property had a quality of construction rating of Q4 and a condition rating of C4.[1]  (Exhibit 3)
  5. Assessment. Respondent set a TVM for the subject property of $376,500, residential, as of January 1, 2017.
  6. Board of Equalization. The BOE set a TVM of the subject property at $376,500, residential, as of January 1, 2017.
  7. Complainant’s Evidence. Complainant opined that the subject propety’s TVM as of January 1, 2017, was $335,529.  To support Complainant’s opinion of value, Complainant offered as evidence the following exhibits:
Exhibit A Change of Assessment notice dated May 8, 2017, showing a prior appraised value of $322,300 and a current appraised value of $376,500 and providing a list of five comparable properties with sale prices ranging from $300,000 to $420,000
Exhibit B Table providing sale prices and appraised values of the five comparable properties and averaging the sale prices and appraised values for comparison to the appraised value of the subject property
Exhibit C Table providing sale prices and appraised values of Complainant’s comparable properties and averaging the sale prices and appraised values for comparison to the appraised value of the subject property
Exhibit D Table providing sale prices and appraised values of Complainant’s comparable properties and averaging the sale prices and appraised values for comparison to the appraised value of the subject property
Exhibit E Table providing data regarding other properties in the same subdivision as the subject property and averaging the appraised value per square foot of the lots and and the improvements
Exhibit F Table providing sale prices and appraised values of the Appraiser’s comparable properties and averaging the sale prices and appraised values for comparison to the appraised value of the subject property
Exhibit G Property record card for Complainant’s comparable property located at 1909 Walden Pond Court
Written Direct Testimony WDT of Complainant
Written Rebuttal Testimony WRT of Complainant

 

Respondent did not object to Complainant’s exhibits, all of which were admitted into the record.             

Complainant testified that he had purchased the subject property in 1997 for either $249,000 or $249,500.  Complainant testified that the subject property had been listed with a realtor and publicly advertised on the multi-listing service (MLS).  Complainant testified that a mortgage encumbered the subject property and that the balance was approximately $300,000.  Complainant testified that he had not listed the subject property for sale within the three years preceding the date of the Evidentiary Hearing and that no offers to purchase the subject property had been made.  Complainant testified that, if he were to list it for sale, he would consult with realtor to price it.  Complainant testified that the subject property had not been appraised within the three years preceding the date of the Evidentiary Hearing.  Complainant testified that no improvements had been made to the subject property between January 1, 2015, and January 1, 2017, but that the subject property was well maintained.  

With regard to Exhibit B, Complainant testified that he was trying to establish that Respondent assesses property at values below the sales prices on record.  With regard to Exhibit C, Complainant testified that he had searched the St. Louis County Real Estate database for properties with a similar number of bedrooms, bathrooms, and square footage as the subject property.  With regard to Exhibit E, Complainant testified that the exhibit showed other properties in the same subdivision as the subject property, all of which were assessed at a lower value than the subject property even though they all were similar to the subject property.  Complainant testified that he used Exhibit E to formulate his opinion of the subject property’s TVM by average the appraised values of comparables used by Respondent to arrive at a price per square foot.  With regard to Exhibit F, Complainant testified that the exhibit corresponded to Respondent’s Exhibit 3 and showed that the average of Respondent’s appraised values for the comparables were lower than the average of the sales prices.

On cross examination, Complainant testified that he is not a certified real estate appraiser.

  1. Respondent’s Evidence. Respondent offered as evidence the following exhibits:
Exhibit 1 Written Direct Testimony (WDT) of Missouri State Certified Residential Real Estate Appraiser Barry A. Hough (the Appraiser)
Exhibit 2 Credentials of the Appraiser
Exhibit 3 Appraisal report of the Appraiser
Exhibit 4 Written Rebuttal Testimony of the Appraiser

 

Complainant objected to Respondent’s Exhibit 3 on the grounds that the appraisal report was not in compliance with Section 137.115.1(2)(a) and (b) because some of the comparable properties were located more than one mile from the subject property and were not within 500 square feet in size of the subject property.  Respondent argued that the objection was made late in that the initial scheduling order required the parties to file their objections to the opposing party’s exhibits no later than March 16, 2018, nearly two weeks before the date of the Evidentiary Hearing.  Respondent further argued that the statute was not relevant in that Exhibit 3 was a certified appraisal report and Complainant was challenging the BOE’s valuation of the subject property, not Respondent’s original assessment.  The Hearing Officer reserved ruling on the objection until the entry of the Decision and Order.

Upon review, it is apparent that the objection was not filed on or before the deadline provided in the initial scheduling order.  Additionally, an objection to the admission of the appraisal report on the ground that the appraisal report did not comply with Section 137.115.1(2)(a) and (b) is misplaced.  Because the BOE did not lower Respondent’s original assessment and because Respondent presented the report only to support his argument that the BOE’s valuation should be sustained – not raised – Section 137.115.1(2)(a) and (b) is not applicable here.[2]  There is no dispute that Respondent’s original assessment of the subject property’s TVM as of January 1, 2017, was made by a computer, computer-assisted method or a computer program.  The BOE found the subject property’s TVM to be the same as Respondent’s original assessment, thereby sustaining Respondent’s assessment.  At the Evidentiary Hearing, Respondent advocated that the BOE’s valuation, which was the same as Respondent’s original assessment, should be sustained.  Exhibit 3 was presented as evidence only to support the BOE’s valuation of the subject property.

The objection to Exhibit 3 is overruled.  Exhibit 3 is admitted into the record.  Complainant did not object to Respondent’s other exhibits, which were admitted into the record.

Respondent also presented the testimony of the Appraiser.  The Appraiser opined that the TVM of the subject property was $408,000 as of January 1, 2017.  The Appraiser testified that he used the sales comparison approach to arrive at an opinion of TVM for the subject property.

In his report, the Appraiser analyzed six comparable sales, five of which were situated within less than one mile of the subject property.  (Exhibit 3)  The sale prices of the comparables ranged from $374,000 to $445,000.  (Exhibit 3)  The comparables sold between May 2014 and June 2016.  The Appraiser made market-based adjustments to each of the comparables to account for the differences between them and the subject property.  The adjusted sale prices of the comparables ranged from $391,000 to $419,000.  (Exhibit 3)  In the report, the Appraiser noted that the comparables were the most similar sales found in the subject property’s neighborhood, were considered the most reliable indicators of value, and were located in the same or similar marketing area.  (Exhibit 3)  The Appraiser placed the most weight on Comparable Nos. 1 and 2 because of their immediate proximity and physical similarity to the the subject property.  (Exhibit 3)

Comparable Nos. 1 and 2 were located on the same street as the subject property.  Comparable No. 1 had a sale date of June 2016, six months prior to the tax date at issue.  Comparable No. 1 had a sale price of $440,000.  Comparable No. 2 had a sale date of May 2014, more than two years prior to the tax date at issue.  Comparable No. 2 had a sale price of $445,000.  The size of Comparable No. 1’s lot was within less than 500 square feet of the subject property’s lot.  The size of Comparable No. 2’s lot was exactly the same as the subject property’s lot.  Comparable Nos. 1 and 2 were two-story single family homes built within two years of the subject property.  Comparable Nos. 1 and 2 each had four bedrooms, two full bathrooms, one half bathroom, and had quality of construction ratings of Q4 and condition ratings of C4 – like the subject property.  (Exhibit 3)

The Appraiser made positive and negative market-based dollar adjustments to the sale prices of Comparable Nos. 1 and 2 for specific characteristics that were either superior or inferior in relation to the subject property, such as additional gross living area, lack of basement finish, lack of a deck, and the existence of a pool.  (Exhibit 3)  The adjusted sale prices of Comparable No. 1 was $404,500, while the adjusted sale price of Comparable No. 2 was $419,000.  (Exhibit 3)

On cross examination, the Appraiser testified that Exhibit 3 utilized different comparable properties than those used by the computerized mass appraisal system because the Appraiser was not performing a mass appraisal but an independent appraisal of the subject property.  The Appraiser testified that he chose the best available comparables in appraising the subject property.  The Appraiser acknowledged that the gross living area square footage of Comparable Nos. 1 and 2 were greater than 500 square feet of the gross living area of the subject property.  However, the Appraiser made market-based negative adjustments of $33,000 and $26,000 to the sale prices of Comparable Nos. 1 and 2 to account for the difference.

Complainant asked the Appraiser a series of questions related to the certifications contained in Exhibit 3, most notably Certification 3 on page 3 of the report which provided:

Unless otherwise stated, the appraiser has no present or prospective interest in the property that is the subject of this report and has no personal interest with respect to the parties involved.

 

Complainant asked the Appraiser whether he had a personal interest in his employer, Respondent.  The Appraiser testified “No,” and that he was required to be independent and unbiased in performing appraisals of property.  The Appraiser further testified that he considered himself to be “absolutely unbiased” in performing appraisals of property.  Complainant asked how the Appraiser’s employer, Respondent, would view an opinion of value below the valuation set by the computerized mass appraisal system.  The Appraiser testified that his answer was conjecture but that Respondent’s interest was in finding the market value of property and that Respondent was interested in fairness and would have accepted and changed the appraised value of the subject property if the appraisal had justified the change.  The Appraiser testified that the appraisal amount shown in Exhibit 3 had not been predetermined.

In his written rebuttal testimony, the Appraiser had testified that he did not use the property listed in Complainant’s Exhibit G as a comparable because the property sold subsequent to the effective date of the appraisal.  The property listed in Complainant’s Exhibit G sold in April 2016 in the amount of $371,500.  (Exhibit G)  Exhibit G provided limited information about the property:  two-story single-family home built in 1987; 2,594 square feet of total living area; four bedrooms; three full bathrooms; one half bathroom; a full basement; construction rating of B-; condition rating of Average.  (Exhibit G)

On cross examination, the Appraiser testified that he had reviewed the multi-listing service data and public records related to the property listed in Complainant’s Exhibit G, which had reported that the sale occurred after the effective date of the appraisal.  Upon reviewing Complainant’s Exhibit G during the hearing, the Appraiser acknowledged that the sale occurred prior to the effective date of the appraisal.  On re-direct, the Appraiser testified that, even if he had known of the correct sale date of the property in Complainant’s Exhibit G, such knowledge would not have changed his final opinion of the TVM of the subject property because the Appraiser does not rely on the St. Louis County Real Estate Information database to select comparable properties for appraisals but does use some of the information in the database to validate information obtained from other sources.    

  1. Presumption of Correct Assessment Not Rebutted. Complainant did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE and to establish the TVM of the subject property as of January 1, 2017, to be $335,529.

Respondent’s evidence was substantial and persuasive to establish the TVM of the subject property, as of January 1, 2017 to be $408,000.  However, Respondent’s evidence was accepted only to sustain the BOE determination of the subject property’s TV, and not for the purpose of raising the assessment above that value.

CONCLUSIONS OF LAW AND DECISION

Jurisdiction

The STC has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious, including the application of any abatement.  The Hearing Officer shall issue a decision and order affirming, modifying or reversing the determination of the BOE, and correcting any assessment which is unlawful, unfair, improper, arbitrary, or capricious.  Article X, Section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo

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.  Article X, Sections 4(a) and 4(b), Mo. Const. of 1945.  The constitutional mandate is to find the true value in money for the property under appeal.  By statute, real property and tangible personal property are assessed at set percentages of true value in money:  residential property at 19%; commercial property at 32%; and agricultural property at 12%.  Section 137.115.5 RSMo (2000) as amended.

Investigation by Hearing Officer

In order to investigate appeals filed with the STC, 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 RSMo (2000) as amended.  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.

Board Presumption and Computer-Assisted Presumption

            There exists a presumption of correct assessment by the BOE – the BOE presumption.  The BOE presumption requires the taxpayer to present substantial and persuasive evidence to rebut it.  If Respondent is seeking to prove a value different than that set by the BOE, then Respondent is required to rebut the BOE presumption.  The BOE’s valuation is assumed to be an independent valuation.

The computer-assisted presumption can only come into play in those instances where the BOE has lowered the assessor’s original valuation of the subject property and Respondent is seeking to have the valuation returned to the assessor’s original valuation.  If in a given appeal the Respondent is offering evidence that would establish a value less than the original valuation, then the computer-assisted presumption is not applicable to that appeal.  Even if the BOE has reduced the valuation and the Respondent’s evidence is offered to increase the value, but not to the level of the original valuation, the computer-assisted presumption does not come into play.

If the BOE sustained the valuation of the assessor, the BOE presumption remains operative as to evidence which is presented by Complainant and Respondent.  The computer-assisted presumption only comes into play if the BOE lowered the value of the assessor and Respondent is seeking to sustain the original assessment that was made as the result of a computer-assisted method.

In the present appeal, the BOE independently valued the subject property at the same amount as Respondent’s original assessment.  Complainant is now seeking to lower the BOE’s valuation; therefore, the BOE presumption applies to Complainant.  Respondent is not seeking to prove a different value than that set by the BOE but advocated that the BOE’s valuation should be sustained.  The computer-assisted presumption does not apply under the circumstances.

Complainant’s Burden of Proof

To obtain a reduction in assessed valuation based upon an alleged overvaluation, the Complainant must prove the true value in money of the subject property on the subject tax day.  Hermel, Inc., v. State Tax Commission, 564 S.W.2d 888, 897 (Mo. banc 1978).  True value in money is defined as the price that the subject property would bring when offered for sale by one willing but not obligated to sell it and bought by one willing or desirous to purchase but not compelled to do so.  Rinehart v. Bateman, 363 S.W.3d 357, 365 (Mo. App. W.D. 2012); Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008); Greene County v. Hermel, Inc., 511 S.W.2d 762, 771 (Mo. 1974).  True value in money is defined in terms of value in exchange and not in terms of value in use.  Stephen & Stephen Properties, Inc. v. State Tax Commission, 499 S.W.2d 798, 801-803 (Mo. 1973).  In sum, true value in money is the fair market value of the subject property on the valuation date.  Hermel, Inc., 564 S.W.2d at 897.

“’True value’ is never an absolute figure, but is merely an estimate of the fair market value on the valuation date.”  Drury Chesterfield, Inc., v. Muehlheausler, 347 S.W.3d 107, 112 (Mo. App. E.D. 2011), citing St. Joe Minerals Corp. v. State Tax Comm’n of Mo., 854 S.W.2d 526, 529 (Mo. App. E.D. 1993).  “Fair market value typically is defined as the price which the property would bring when offered for sale by a willing seller who is not obligated to sell, and purchased by a willing buyer who is not compelled to buy.”  Drury Chesterfield, Inc., 347 S.W.3d at 112 (quotation omitted).

A presumption exists that the assessed value fixed by the BOE is correct.  Rinehart, 363 S.W.3d at 367; Cohen, 251 S.W.3d at 348; Hermel, Inc., 564 S.W.2d at 895.  “Substantial and persuasive controverting evidence is required to rebut the presumption, with the burden of proof resting on the taxpayer.” Cohen, 251 S.W.3d at 348.  Substantial evidence can be defined as such relevant evidence that a reasonable mind might accept as adequate to support a conclusion.  Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).  Persuasive evidence is evidence that has sufficient weight and probative value to convince the trier of fact.  Cupples Hesse Corp., 329 S.W.2d at 702.  The persuasiveness of evidence does not depend on the quantity or amount thereof but on its effect in inducing belief.   Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975). See also, 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).

There is no presumption that the taxpayer’s opinion is correct. The taxpayer in a STC 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.”  Westwood Partnership, 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. W.D. 1991).

Generally, a property owner, while not an expert, is competent to testify to the reasonable market value of his own land.  Cohen, 251 S.W.3d at 348-49; Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992).  “However, when an owner’s opinion is based on improper elements or foundation, his opinion loses its probative value.”  Carmel Energy, Inc., 827 S.W.2d at 783.  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. E.D. 1980).

In this case, Complainant opined that the TVM of the subject property was $335,529 as of January 1, 2017.

Respondent’s Burden of Proof

Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the Board of Equalization, must meet the same burden of proof to present substantial and persuasive evidence of the value advocated as required of the Complainant under the principles established by case law. Hermel, Cupples-Hesse, Brooks, supra

Here, although not required, Respondent presented substantial and persuasive evidence to rebut the presumption correct assessment by the BOE.  However, Respondent advocated that the evidence should be used only to sustain the BOE’s determination of the subject property’s TVM as of January 1, 2017.

Weight to be Given Evidence

The Hearing Officer is not bound by any single formula, rule, or method in determining true value in money and 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.  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).

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 deemed necessary when viewed in connection with all other circumstances.  Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. W.D. 1991).  The Hearing Officer, as the trier of fact, is not bound by the opinions of experts but may believe all or none of the expert’s testimony or accept it in part or reject it in part.  Exchange Bank of Missouri v. Gerlt, 367 S.W.3d 132, 135-36 (Mo. App. W.D. 2012).

Complainant testified on his own behalf.  Respondent presented the expert testimony and report of the Appraiser.

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.   See, Nance v. STC, 18 S.W.3d 611, 615 (Mo. App. W.D. 2000); Hermel, Inc., 564 S.W.2d at 897; Xerox Corp. v. STC, 529 S.W.2d 413 (Mo. banc 1975).  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.   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. 1974).

“For purposes of levying property taxes, the value of real property is typically determined using one or more of three generally accepted approaches.”  Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341, 346 (Mo. banc 2005), citing St. Louis County v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977).  “Each valuation approach is applied with reference to a specific use of the property—its highest and best use.” Snider, 156 S.W.3d at 346-47, citing Aspenhof  Corp., 789 S.W.2d at 869.  “The method used depends on several variables inherent in the highest and best use of the property in question.”  Snider, 156 S.W.3d at 347.

“Each method uses its own unique factors to calculate the property’s true value in money.”  Id.  “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 348.  “Comparable sales consist of evidence of sales reasonably related in time and distance and involve land comparable in character.”  Id. (quotation omitted).  “This approach is most appropriate when there is an active market for the type of property at issue such that sufficient data [is] available to make a comparative analysis.”  Id.

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.

 

  1. Both parties are well informed and well advised, and both acting in what they consider their own best interests.

 

  1. A reasonable time is allowed for exposure in the open market.

 

  1. Payment is made in cash or its equivalent.

 

  1. Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.

 

  1. 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.

 

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.

Discussion

            In this case, Complainants’ evidence was not substantial and persuasive to rebut the presumption of correct assessment by the BOE.  Substantial evidence can be defined as such relevant evidence that a reasonable mind might accept as adequate to support a conclusion.  Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959)Persuasive evidence is evidence that has sufficient weight and probative value to convince the trier of fact.  Cupples Hesse Corp., 329 S.W.2d at 702.  Specifically, Complainant did not present evidence utilizing any of the three court-approved methods for valuing residential property but relied upon averages of sale prices and averages of appraised values.  The fact finder would be forced to speculate that Complainant’s opinion of the subject property’s TVM was correct.

            Respondent, though not required, presented substantial and persuasive evidence supporting the BOE’s valuation of the subject property.  The Appraiser used the comparable sales method for arriving at an opinion of TVM for the subject property, which is one of the three court-approved methods for determining value for tax assessment purposes.  The Appraiser’s report made market-based dollar adjustments to account for the similarities and differences between the comparables analyzed in the report and the subject property.

Exhibit 3 contained a total of six comparable properties.  Four of the comparables had sales that closed within one year preceding the relevant tax date.  Five of the comparables were located within less than one mile of the subject property.  Four of the comparables were two-story homes with the same bedroom and bathroom count as the subject property.  The Appraiser accounted for the differences by making market-based dollar adjustments to the sale prices of all of the comparables.  Significantly, the Appraiser placed the most weight on Comparable Nos. 1 and 2 in arriving at an opinion of the subject property TVM.  Comparable Nos. 1 and 2 were strikingly similar to the subject property.  The market-based dollar adjustments to the sale prices of Comparable Nos. 1 and 2 resulted in lower adjusted sale prices of $404,000 and $419,000.  The Appraiser’s opinion of the subject property’s TVM, $408,000, was positioned at the lower end of the range of these values.  Respondent did not advocate raising the BOE’s determination of the subject property’s TVM, which was approximetly 8% lower than the Appraiser’s opinion of the subject property’s TVM.

ORDER

The TVM for the subject property as determined by the BOE is AFFIRMED.  The assessed value for the subject property for tax year 2017 is set at $71,535 residential ($376,500 TVM).

Application for Review

A party may file with the STC 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, MO 65102-0146, 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. Section 138.432, RSMo

Disputed Taxes

The Collector of St. Louis 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 June 14 , 2018.

STATE TAX COMMISSION OF MISSOURI

Amy S. Westermann

Senior Hearing Officer

 

Certificate of Service

I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 14 day of June, 2018, to: Complainants(s) counsel and/or Complainant, the County Assessor and/or Counsel for Respondent and County Collector.

 

Jacklyn Wood

Legal Coordinator

 

[1] Exhibit 3 contained Uniform Appraisal Dataset Definitions.  Q4 is defined as “[d]wellings with this quality rating meet or exceed the requirements of applicable building codes. Standard or modified standard building plans are utilized and the design includes adequate fenestration and some exterior ornamentation and interior refinements. Materials, workmanship, finish, and equipment are of stock or builder grade and may feature some upgrades.”  C4 is defined as “[t]he improvements feature some minor deferred maintenance and physical deterioration due to normal wear and tear. The dwelling has been adequately maintained and requires only minimal repairs to building components/mechanical systems and cosmetic repairs. All major building comonents have been adequately maintained and are functionally adequate.”

[2] In charter counties or the City of St. Louis, Respondent, when wishing to advocate for a valuation to return the valuation to the assessor’s original valuation, which was higher than the value assigned by the BOE, has imposed upon him by the provisions of Section 137.115.1, RSMo (2000, as amended), the burden of proof to present clear, convincing and cogent evidence to sustain a valuation on residential property which was made by a computer, computer-assisted method or a computer program.  If the BOE sustained the original valuation of Respondent, the computer-assisted presumption does not come into play, as the BOE’s valuation is an independent valuation.