STATE TAX COMMISSION OF MISSOURI
|WILLARD & CAROL SCHNURBUSCH||)|
|v.||)||Appeal No. 17-61502|
|DANIEL FRANKS, ASSESSOR||)|
|HOWELL COUNTY, MISSOURI,||)|
DECISION AND ORDER
Decision of the County Board of Equalization (BOE) of Howell County is AFFIRMED. Willard and Carol Schnurbusch (Complainants) did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE.
True value in money (TVM) for the subject property for tax year 2017 is set at $89,680, residential classification.
Complainants appeared pro se.
Daniel Franks, the Assessor of Howell County, Missouri (Respondent) appeared personally and by attorney Lyndell Beard.
Case heard and decided by Senior Hearing Officer John Treu.
Complainants appeal on the ground of overvaluation, the decision of the Howell County BOE, which set a TVM of $89,680, residential classification. Complainants assert that the subject property has a TVM of $0.00. The State Tax Commission (STC) takes this appeal to determine the TVM for the subject property as of January 1, 2017. The TVM as of January 1 of the odd numbered year remains the TVM 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. Complainants timely appealed to the STC from the decision of the Howell County BOE.
- Evidentiary Hearing. The Evidentiary Hearing was held on December 5, 2017, at the Howell County Courthouse, West Plains, Missouri.
- Identification of Subject Property. The subject property is identified by map parcel number or locator number 15-5.0-16-000-000-057.0100. It is further identified as 1496 State Route BB, West Plains, Howell County, Missouri. (Complaint for Review of Assessment)
- Description of Subject Property. The subject property consists of a tract of land of approximately 25,000 square feet, improved by a commercial type office building utilized by Complainants as a residence. The improvement consists of 3,200 square feet on two levels. The upper level consists of 1,600 square feet, which includes four total office rooms, a reception area, a conference room, a kitchen area and two bathrooms. Amenities include central air, high efficiency gas furnace, a 9’ x 40’ wooden deck and a 6’ x 40’ porch. (Ex. C and Testimony)
- Attempted Sale of Subject. Complainants have attempted to sell the subject property for thirteen years. In July 31, 2005, Complainants listed the subject property for $200,000. In 2010, Complainants attempted to sell the subject property at an auction. No bids were offered. The subject property is currently listed by Complainants for $175,000. (Ex. A, B, C and Testimony).
- Assessment. The Assessor set a TVM of $89,680. The BOE set a TVM of $89,680.
- Complainants’ Evidence. Complainants offered into evidence the following:
|A||History of Attempts to Sell Subject Property|
|B||Advertisements, Listing Contract and Invoice|
|D||STC Decision and Order 15-30729|
|E||STC Decision and Order 17-44000|
|F||Internet Article Regarding Property in San Francisco|
|H||Portions of West Plains Code|
|I||West Plains Code, Section 10-47 (purportedly now Section 6-52)|
|K||Portion of Article|
|L||Third Amended Petition with Supplements|
|M||Various Photographs of Surrounding Structures|
|N||Various Photographs of Animal Shelter Sign, Loose Dog, For Sale Sign, Other|
|O||Photographs of Complainants’ Other Property (Not Subject Property)|
Exhibits A, B, C, G, H, I, J and N were received into evidence without objection. Respondent objected to Exhibits D, E, F, K, L, M and O. Exhibits F and O were excluded from the evidentiary record as irrelevant. Exhibits D, E, K, L and M were received into the evidentiary record to be given such weight, if any, the Hearing Officer deemed appropriate.
Complainants assert that the TVM of the subject property is negatively impacted by the existence of an animal shelter located 60 feet from the subject property. Complainants contend that the animal shelter houses over 100 animals, both dogs and cats, and emits odors from exhaust fans facing the subject property. Complainants also contend the dogs produce excessive barking noise. Finally, Complainants contend the aforementioned activities violate West Plains, Missouri, Code.
- Respondent’s Evidence. Respondent offered into evidence Exhibit 1 which consisted of a check from the Beard Law Firm, LLC, in the amount of $20,000, presented at the Evidentiary Hearing to Complainants as an offer to purchase the subject property. Exhibit 1 was received into evidence without objection.
- Presumption of Correct Assessment Not Rebutted. Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the BOE and establish the TVM, as of January 1, 2017, to be $0.00, as proposed by Complainants.
CONCLUSIONS OF LAW AND DECISION
The STC 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 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 TVM for the property under appeal. By statute real and tangible personal property are assessed at set percentages of TVM. Section 137.115.5, RSMo – residential property at 19% of TVM; commercial property at 32% of TVM and agricultural property at 12% of TVM.
Presumption In Appeal
There is a presumption of validity, good faith and correctness of assessment by the County BOE. 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 – Complainants. The presumption of correct assessment is rebutted when the taxpayer presents substantial and persuasive evidence to establish that the Board’s TVM is erroneous and what the TVM should have been placed on the property. Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. See, Cupples-Hesse, supra. 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. Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975).
Complainants’ Burden of Proof
In order to prevail, Complainants must present an opinion of TVM and substantial and persuasive evidence that the proposed value is indicative of the market value of the subject property on January 1, 2017. 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, in the present appeal, Complainants bear 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). A valuation which does not reflect the TVM of the property under appeal is an unlawful, unfair and improper assessment.
Owner’s Opinion of Value
The owner of property is generally held competent to testify to its TVM. 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 TVM 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). TVM 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 TVM of the subject property on the valuation date. Hermel, supra.
TVM 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.
Investigation by Hearing Officer
In order to investigate appeals filed with the STC, the Hearing Officer may inquire of the owners of the property or of any other party to the appeal regarding any matter or issue relevant to the valuation, sub-classification or assessment of the property. 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. Section 138.430.2, RSMo. The Hearing Officer made inquiry of Complainants during the evidentiary hearing.
Weight to be Given Evidence
The Hearing Officer is not bound by any single formula, rule or method in determining TVM, 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).
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, at 615 (Mo. App. W.D. 2000); Hermel, supra; 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. Div. 2 1974).
Complainants Fail to Prove TVM
Complainants contend the subject property’s proximity to an animal shelter negatively impacts the TVM of the subject property. Even assuming Complainants contentions of a negative impact on the TVM of the subject property due to the animal shelter, Complainants presented no evidence utilizing any accepted method of appraisal to support their proposed TVM of $0.00. Complainants did not provide substantial and persuasive evidence that the BOE determination of TVM did not consider any impact of the animal shelter or establish the TVM of the subject property and the monetary impact of any purported nuisance on the subject property’s TVM. Consequently, Complainant failed to meet their burden of proof.
The Hearing Officer is persuaded that the subject property has some TVM above $0.00. The subject property is currently listed by Complainants for $175,000. Furthermore, Complainants were presented with a check for $20,000 to purchase the subject property during the Evidentiary Hearing, but refused to sell the subject property for such amount.
The assessed valuation for the subject property as determined by the BOE for Howell County, Missouri, 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 Howell 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 26th day of December, 2017.
STATE TAX COMMISSION OF MISSOURI
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 26th day of December, 2017, to: Complainants(s) counsel and/or Complainant, the County Assessor and/or Counsel for Respondent and County Collector.
AssessorHowell@centurytel.net; Collector; Willard & Carol Schnurbusch, 6522 County Road 2570, West Plains, MO 65775