State Tax Commission of Missouri
|TGM REALTY, LLC||)|
|v.||)||Appeal No. 15-20025|
|FREDDIE DUNLAP, ASSESSOR||)|
|CITY OF ST. LOUIS, MISSOURI,||)|
DECISION AND ORDER
Decision of the St. Louis City Board of Equalization is AFFIRMED.
Complainant did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the Board of Equalization regarding valuation.
Residential Assessed Value for the subject property for tax years 2015 and 2016 is set at $8,290.
Complainant appeared by attorney Timothy Maxwell.
Respondent appeared by attorney Abby Duncan
Case heard and decided by Senior Hearing Officer John Treu.
Complainant appeals, on the grounds of overvaluation, the decision of the City of St. Louis Board of Equalization. The Commission takes this appeal to determine the assessed value in money for the subject property on January 1, 2015. The assessment as of January 1 of the odd numbered year remains the assessment as of January 1 of the following even numbered year unless there is new construction and improvement to the property. Section 137.115.1 RSMo.
FINDINGS OF FACT
- Jurisdiction. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission from the decision of the St. Louis City Board of Equalization.
- Evidentiary Hearing. The Evidentiary Hearing was held on January 18, 2017, at St. Louis City Hall, St. Louis, Missouri.
- Identification of Subject. The subject property is identified by map parcel number or locator number 2776-06-0060-0. It is further identified as 4742 Idaho Avenue, St. Louis, MO (Complaint for Review of Assessment & Exhibit 1).
- Description of Subject Property. The subject residential property consists of a tract of land of 7,369 square feet, improved by a single family one-story brick home, with a gross living area of 1,377 square feet. Amenities include 3 bedrooms, 1 full bathroom and 1 half bathroom. The subject has both a front and rear porch. The home has central air and heat.
- Assessment. The Assessor determined the true value of $43,600, residential assessed value of $8,290. The St. Louis City Board of Equalization (BOE) sustained the determinations. (Complaint for Review of Assessment).
- Complainant’s Evidence. Complainant offered into evidence the following:
|Exhibit A||Closing Statement||Yes||Yes|
|Exhibit B||Comparables by Christopher Sorth (Realtor)||Yes||No|
|Exhibit C||Affidavit of Renters||Yes||Yes|
|Exhibit D||Crime Listings||Yes||Yes|
|Exhibit E||Crime Article||Yes||Yes|
|Exhibit F||Crime Article||Yes||Yes|
|Exhibit I||Written Direct Testimony of Timothy Maxwell||Yes||Yes|
|Exhibit J||Written Direct Testimony of Timothy Maxwell||Yes||Yes|
Respondent objected to Exhibits B through H. Regarding Exhibits C through H, the objection was overruled, to be given such weight, if any, as the Hearing Officer deemed appropriate. The objection regarding Exhibit B was sustained as the Realtor was not present for cross examination.
- No Evidence of New Construction & Improvement. There was no evidence of new construction and improvement from January 1, 2015, to January 1, 2016; therefore, the assessed value for 2015 remains the assessed value for 2016. Section 137.115.1, RSMo.
- Respondent’s Evidence. Respondent offered into evidence the following:
|Exhibit1||Appraisal Report Opining a True Market Value of||Yes||Yes|
|$54,700 (see pages 7 & 9) to support Board of|
|Equalization value (see pages 1 & 9)|
|Exhibit 2||Written Direct Testimony of Caressa Williams||Yes||Yes|
Respondent objected to both Exhibits 1 and 2. The objections were overruled. The appraisal was offered to support the Board of Equalization determination.
- Presumption of Correct Assessment Not Rebutted. Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the true value in money of the subject property as of January 1, 2015. See, Presumption In Appeal, infra.
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 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. 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 and tangible personal property are assessed at set percentages of true value in money. Section 137.115.5, RSMo – residential property at 19% of true value in money.
Presumption In Appeal
There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization. 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). 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.
Complainant’s Burden of Proof
The taxpayer in a Commission appeal bears the burden of proof. 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, 2015. Hermel, supra. There is no presumption that the taxpayer’s opinion is correct. 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.” 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).
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. 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).
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its reasonable market value. Rigali v. Kensington Place Homeowners’ Ass’n, 103 S.W.3d 839, 846 (Mo. App. E.D. 2003); Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970). The owner’s opinion is without probative value; however, where it is shown to have been based upon improper elements or an improper foundation. Cohen v. Bushmeyer, 251 S.W.3d 345, (Mo. App. E.D., March 25, 2008); Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992); State, ex rel. Missouri Hwy & Transp. Com’n v. Pracht, 801 S.W.2d 90, 94 (Mo. App. E.D. 1990); Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965). “Where the basis for a test as to the reliability of the testimony is not supported by a statement of facts on which it is based, or the basis of fact does not appear to be sufficient, the testimony should be rejected.” Carmel Energy at 783. A taxpayer does not meet his burden if evidence on any essential element of his case leaves the Commission “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).
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. 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). True value in money is defined in terms of value in exchange and not value in use. 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).
It is the fair market value of the subject property on the valuation date. Hermel, supra.
Market value is the most probable price in terms of money which a property should bring in a 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:
- Buyer and seller are typically motivated.
- Both parties are well informed and well advised, and both acting in what they consider their own best interests.
- A reasonable time is allowed for exposure in the open market.
- Payment is made in cash or its equivalent.
- Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.
- 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.
Complainant Fails to Proves Value
Complainant failed to present substantial and persuasive evidence to establish a fair market value as of January 1, 2015, for the subject property. Complainant’s testimonial evidence and the exhibits presented by Complainant were not substantial and persuasive to allow a determination of the true market value of the property.
The actual sale price is a method that may be considered for estimating true value. Complainant presented a closing statement and testified regarding the purchase of the property. Evidence of the actual sales price of property is admissible to establish value at the time of an assessment, provided that such evidence involves a voluntary purchase not too remote in time. St. Joe Minerals Corp. v. STC, 854 S.W.2d 526 (App. E.D. 1993). The Complainant purchased the property in 2012. The Hearing Officer finds the purchase in 2012 to be too remote in time to be substantial and persuasive for valuation on January 1, 2015.
The Complainant also presented evidence regarding crime in the area. Although such information may impact the market value of the property, it does not establish market value for the property.
Complainant did not meet its burden of proof. Complainant did not present any recognized approach to valuation or more recent information regarding the market value of the subject property.
Respondent did present an appraisal of the subject property. Given that Complainant did not meet its burden of proof, the Hearing Officer found it unnecessary to consider Respondent’s evidence.
The assessed valuation for the subject property as determined by the Board of Equalization for St. Louis City for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax years 2015 & 2016 is set at $8,290
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, 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
The Collector of St. Louis City, 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 this 2nd day of February, 2017.
STATE TAX COMMISSION OF MISSOURI
John J. Treu
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 2nd day of February, 2017, to: Complainants(s) counsel and/or Complainant, the County Assessor and/or Counsel for Respondent and County Collector.