State Tax Commission of Missouri
|)||Appeal Number 13-11786|
|JAKE ZIMMERMAN, ASSESSOR,||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
DECISION AND ORDER
Decision of the County Board of Equalization sustaining the assessment made by the Assessor is SUSTAINED.
Complainant appeared pro se.
Respondent appeared by attorney Paula Lemerman
Case heard and decided by Hearing Officer Maureen Monaghan.
Complainant appeals, on the ground of overvaluation, the decision of the St. Louis County Board of Equalization, which reduced 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, 2013. The value as of January 1 of the odd numbered year remains the value 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
The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
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 County Board of Equalization.
- Evidentiary Hearing. The Evidentiary Hearing was held on July 29, 2014 at the St. Louis County Administration Building, Clayton, Missouri.
- Identification of Subject Property. The subject property is identified by map parcel number 19N330366. It is further identified as 5 Jaccard Lane, Ladue, St. Louis County, Missouri.
- Description of Subject Property. The subject property consists of a tract of land a little under one acre improved by a single family one and a half story home of good quality construction, with 2,195 square feet of living area. Amenities include four bedrooms, two bathrooms, a partial basement, a fireplace, in ground pool, and a two car basement garage. The property is approximately 75 years of age and is in need of maintenance, renovations and updating. The property is bounded by Lindbergh, Ladue, Ballas and Clayton Roads. Clayton Road is separated from the area by Highway 40/Interstate 64.
- Assessment. The Assessor appraised the property at $491,000. The Board of Equalization reduced the valuation to $434,500.
- Complainant’s Evidence. Complainant proposed a value of $399,000. Complainant presented the testimony of James M. Croak, Missouri State Certified Residential Appraiser, the appraisal report of Mr. Croak (Exhibit A) and Exhibit B. Exhibit B consisted of 2 pages. One page was a blank form Property Assessment Appeal – Findings of Facts – BOE Hearing, Section III, the second page was Section IV – Hearing Officer’s Review and Recommendation ($400,000)and Section V, the Board’s finding of $434,500. Respondent objected to Exhibit B. Exhibit B was admissible as to Section V the findings of the Board of Equalization.
- No Evidence of New Construction & Improvement. There was no evidence of new construction and improvement from January 1, 2013, to January 1, 2014, therefore the assessed value for 2013 remains the assessed value for 2014. Section 137.115.1, RSMo.
- Respondent’s Evidence. Respondent proposed a value of $488,000. Respondent submitted the following Exhibits:
|3||MLS Listing Respondent’s Comparable 1|
|4||MLS Listing Respondent’s Comparable 2|
|5||MLS Listing Respondent’s Comparable 3|
|6||MLS Listing Respondent’s Comparable 4|
- Valuation. Both parties presented relevant evidence as to the valuation of the property. In reviewing the comparable properties and the range of values, the fair market value of the subject property as presented by the parties conflicted and therefore neither established true value by substantial and persuasive evidence.
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; commercial property at 32% of true value in money and agricultural property at 12% 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). 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. Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
Complainants’ Burden of Proof
In order to prevail, Complainants 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, 2013. Hermel, supra. 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.” 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).
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.
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).
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).
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 all or none of the expert’s testimony and accept it in part or reject it in part. 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).
Opinion Testimony by Experts
The testimony of an expert is to be considered like any other testimony, is to be tried by the same test, and receives just so much weight and credit as the trier of fact may deem it entitled to when viewed in connection with all other circumstances. The Hearing Officer, as the trier of fact, has the authority to weigh the evidence and is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe all or none of the expert’s testimony and may accept it in part or reject it in part. Beardsley v. Beardsley, 819 S.W. 2d 400, 403 (Mo. App. 1991); Curnow v. Sloan, 625 S.W. 2d 605, 607 (Mo. 1981); Scanlon v. Kansas City, 28 S.W. 2d 84, 95 (Mo. 1930).
Both parties presented evidence as to the valuation of the subject property. Both witnesses developed opinions of value relying upon an established and recognized approach for the valuation of real property, the sales comparison or market approach. The sales comparison approach is generally recognized to be the most reliable methodology to be utilized in the valuation of single-family residences.
The adjustments made by the appraisers were consistent with generally accepted guidelines for the appraisal of property of the subject’s type. The adjustments properly accounted for the various differences between the subject and each comparable.
The Complainant presented the appraisal report of James Croak. Mr. Croak is a Missouri licensed, certified residential appraiser. He has served as an appraiser for over 20 years. He lives within 3 miles of the subject property, has lived in the area most of his life, and most importantly, appraises property in the area of the subject. The appraiser used four comparables with sales prices ranging from $234,000 to $400,000. The comparable sales prices were six to ten months from effective date of valuation. The sales were market sales. The appraiser testified that his review of the time of exposure and marketing of the properties indicated no impact by the fact that they were owned by banks and sold “as-is”. The properties were located from one half mile to two miles from the subject. Comparable 2, located two miles from the subject and selling for $400,000, was not as persuasive of a comparable given its location, school district, room count and square footage. The remaining comparables presented sold in a range from $234,000 to $334,000. The properties were torn down and at least two had new residential improvements since the time of the sale – an indication that the properties in the market area are dated (given their ages over 60 years) and buyers are willing to purchase the property for the value of the land.
The county presented the opinion of value from a staff residential appraiser. His comparable sales occurred in 2011 – 15 to 20 months prior to the effective date. The comparables were close in location to the subject and on the same side of Highway 40. The comparable properties appear, by the photos, to be of better condition than subject. The subject is in need of updates and maintenance. An indication of the need for updates is the appraiser’s adjustment of $60,000 to Comparable 3 with the updated kitchen. The appraiser made no adjustment for the lack of bathrooms in basements of the comparables. He also failed to make an adjustment for decks and screen porch on Comparable 4. Further the staff appraiser’s square footage of the subject may be questioned as he measured from the outside and assigned a percentage of square footage to develop the area on the second floor.
Complainant’s appraiser most persuasive sales were from $234,000 to $334,000 within the half mile of the subject – the properties were torn down. There was not substantial and persuasive evidence that the property is of a condition to be marketed as a tear down. Respondent sales were from $495,000 to $537,000 but the sales were dated 15-20 months prior to the effective date and the exterior photos of the comparables present properties updated and better maintained. There was not substantial and persuasive evidence that the subject was as updated and maintained as the Respondent’s comparables. A review of the adjustments in the reports shows the Complainant’s appraiser made gross adjustments up to 52% where the staff appraiser’s gross adjustments were up to 25.6%; however, without detailed rebuttal evidence it is unknown if the Complainant’s comparable properties were not like the subject or if the staff appraiser desired to keep his adjustments within an acceptable range.
The opinion of values were equally persuasive and there was lack of substantial evidence to conclude that one of the opinions was inaccurate. The Hearing Officer is left with a range of value between $399,000 and $488,000 therefore the Boards’ opinion must stand.
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for St. Louis County for the subject tax day is AFFIRMED.
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 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 this 11th day of August, 2014.
STATE TAX COMMISSION OF MISSOURI
Certificate of Service
I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 11th day of August 2014, to: Victor J. Vouga, 5 Jaccard Ln., Frontenac, MO 63131, Complainant; Paula Lemerman, Associate County Counselor, County Government Center, 41 South Central Avenue, Clayton, MO 63105, Attorney for Respondent; Jake Zimmerman, Assessor, County Government Center, 41 South Central Avenue, Clayton, MO 63105; Mark Devore, Collector, County Government Center, 41 South Central Avenue, Clayton, MO 63105.