STATE TAX COMMISSION OF MISSOURI
|v.||)||Appeal No. 15-10043|
|JAKE ZIMMERMAN, ASSESSOR||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
ORDER AFFIRMING HEARING OFFICER DECISION
On July 11, 2016, Senior Hearing Officer Amy Westermann issued her order affirming the value placed upon the subject property by the St. Louis County Board of Equalization (BOE), finding that Complainant failed to present substantial and persuasive evidence demonstrating market value. Complainant filed an Application for Review of the Decision. Respondent filed a Response. Complainant filed a Reply.
Standard Upon Review
A party subject to a Decision and Order of a Hearing Officer with the State Tax Commission may file an application requesting the case be reviewed by the Commission. The Commission may then summarily allow or deny their request. The Commission may affirm, modify, reverse or set aside the decision. The Commission may take any additional evidence and conduct further hearings.
DISCUSSION AND RULING
Subject property is a one acre lot with no improvements. It backs to Monsanto and a residential subdivision with homes valued near one million dollars. Subject property is “bisected by a private road that provides access to existing residences on …Allegro Lane.”
Complainant purchased it approximately 25 years ago for $18,000. The Complainant opined that his property had no value due to planning and zoning regulations. The subject property is currently zoned “A-Single Family Residential District”. The zoning requirements establish a minimum footage for the yard, maximum site coverage, and maximum floor area ratio. In 1992 Complainant sought a variance to allow the building of a single family residence on the subject property. Complainant presented a letter dated September 25, 2015 from the City of Creve Coeur’s Director of Community Developement which stated that “[i]n order to receive a permit to construct a residence on this lot, the building would need to conform with the zoning requirements or by the granting of an appeal for variances…”.
Complainant opined the property was “worthless” due to the zoning restrictions. Complainant proposed a true value of $2300 which was the value determined by the Respondent the prior assessment cycle. While Complainant presented evidence of significant factors impacting the value of property, Complainant did not present substantial and persuasive evidence to establish a true value of the property between $0 and $2300. Complainant’s only evidence of market value was the purchase price of the property twenty-five years ago.
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). In this appeal, no evidence of market value was presented. As Complainant failed to establish true value for the subject property, Complainant did not meet his burden of proof. Consequently, the Decision of the Hearing Officer should be affirmed.
The Decision and Order of the Hearing Officer, including the findings of fact and conclusions of law is AFFIRMED. It is incorporated by reference, as if set forth herein verbatim, in full, in this final decision of the Commission.
Judicial review of this Order may be had in the manner provided in Sections 138.432 and 536.100 to 536.140, RSMo within thirty days of the mailing date set forth in the Certificate of Service for this Order.
If judicial review of this decision is made, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the courts unless disbursed pursuant to Section 139.031.8, RSMo.
If no judicial review is made within thirty days, this decision and order is deemed final and the Collector of St. Louis County, 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.
SO ORDERED this 25th day of October, 2016.
STATE TAX COMMISSION
Bruce E. Davis, Chairman
Victor Callahan, Commissioner
Certificate of Service
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 25th day of October, 2016, to: Complainants(s) counsel and/or Complainant, the county Assessor and/or Counsel for Respondent and county Collector.
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
State Tax Commission of Missouri
|WILLIAM K. HALLIBURTON,||)|
|v.||)||Appeal No. 15-10043|
|JAKE ZIMMERMAN, ASSESSOR||)|
|ST. LOUIS COUNTY, MISSOURI,||)|
DECISION AND ORDER
The assessment made by the Board of Equalization of St. Louis County (BOE) is AFFIRMED. Complainant William K. Halliburton (Complainant) did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE. Assessed value in money for the subject property for tax years 2015 and 2016 is set at $4,960 residential ($26,100 true market value or TMV).
Complainant appeared pro se.
Respondent Jake Zimmerman, St. Louis County Assessor, (Respondent) appeared by Steven Robson, Assistant County Counselor.
Case heard and decided by Senior Hearing Officer Amy S. Westermann.
Complainant appealed on the ground of overvaluation. Respondent initially set the true market value (TMV) of the subject property, as residential property, at $26,100. The BOE sustained Respondent’s valuation. The Commission takes this appeal to determine the TMV of the subject property on January 1, 2015.
The Senior 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.
- Evidentiary Hearing. The issue of overvaluation was presented at an evidentiary hearing, which was held on May 11, 2016, at the St. Louis County Government Administration Building, 41 South Central Avenue, Clayton, Missouri.
- Identification of Subject Property. The subject property is identified by parcel/locator number 17M130286. It is further identified as 1 Allegro Lane, Creve Coeur, St. Louis County, Missouri. (Complaint; Exhibit 1)
- Description of Subject Property. The subject property consists of an approximately one acre, heavily wooded, unimproved lot. (Exhibit A) Allegro Lane, a private road, runs through the center of the lot, such that approximately half an acre is situated on each side of the road. (Exhibit A)
- Assessment. Respondent set a true market value (TMV) on the subject property at $26,100 residential, as of January 1, 2015.
- Board of Equalization. The BOE sustained Respondent’s TMV of the subject property.
- Complainant’s Evidence. Complainant testified in his own behalf. Complainant testified that he had purchased the subject property in 1990 or 1991 for $18,000. Complainant testified that he purchased the subject property because he wanted to build a home on it but was not allowed to do so because of planning and zoning building regulations in the City of Creve Coeur. Complainant testified that he sought adjustments to the regulations several years prior to the current appeal and in 1992. Complainant testified that his request for adjustments was repeatedly denied. Complainant testified that the subject property is unusable due to the nature of the right-of-way alongside Allegro Lane, the private road that bisects the subject property. The right-of-way is too narrow to allow emergency vehicles to pass to other homes situated on Allegro Lane. Complainant testified that the subject property backs to Monsanto’s property and also to a neighboring subdivision containing $1 million homes. Complainant testified that the subject property was not encumbered by a mortgage and has never been appraised. Complainant testified that he had never listed the subject property for sale because it was unusable. Complainant testified that no improvements had been made to the property between January 1, 2013, and January 1, 2015. Complainant testified that he has only cut the grass and has removed trees that fell across the road bisecting the subject property. Complainant opined the subject property had a fair market value of $2,300 as of January 1, 2015, even though he believed it was worthless.
Complainant offered as evidence a binder containing (1) the procedural orders of the Commission related to the appeal; (2) a copy of the BOE’s Notice of Decision; (3) the Property Assessment Appeal Form that Complainant had filed with the BOE; (4) the Projected Tax Liability Notice for 2015 that Complainant had received from St. Louis County; (5) a typed letter dated July 1, 2015, addressed to the BOE and describing the subject property; (6) a copy of the Change of Assessment Notice from Respondent showing that the prior appraised value of the subject property had changed from $2,300 in tax year 2013 to $26,100 in tax year 2015 due to reassessment; (7) the 2015 tax bill for the subject property; (8) three color photographs of the road that splits the subject property into two sections; (9) a copy of a survey map of the subject property; (10) a copy of Complainant’s 2013 and 2014 IRS Form 1040 Schedule E Supplemental Income and Loss statements that showed $0 of income from the subject property and losses due to tax payments; (11) the 2004, 2005, and 2006 tax bills for the subject property; (12) a typed letter dated September 25, 2015, from the City of Creve Coeur Director of Community Development informing Complainant that the subject property was zoned “A-Single Family Residential District,” stating the general yard minimum requirements, and stating that to build a residence on the lot the building would need to conform with the zoning requirements or receive a variance from the Board of Adjustment; (13) a series of printed electronic mail messages (email) between Complainant and the City of Creve Coeur Director of Community Development about the subject property; (14) a series of documents dated from 1977 to 2015 showing the history of ownership of the subject property, previous changes in assessment, previous tax bills and payments, previous protests of the assessed value, an invoice from 1992 for engineering services related to presenting an appeal to the Creve Coeur Planning Commission seeking a variance of regulations and allowing Complainant to build a residence on the subject lot, and a typed letter dated September 22, 1992, from the Chairman of the Creve Coeur Planning and Zoning Commission denying Complainant’s request for approval of a “Preliminary Subdivision Plat for Townsend Subdivision to be Located on Allegro Lane”; and (15) a decision of the City of Creve Coeur Board of Adjustment dated June 29, 1977, refusing to allow a variance in the general yard minimum requirements for the subject property so that a residence could be built. (Exhibit A)
Respondent did not object to Complainant’s evidence, which was received into the record.
- Respondent’s Evidence. Respondent offered as evidence the Notice of Decision of the BOE, which set the TMV of the subject property at $26,100. (Exhibit 1)
Complainant did not object to Respondent’s evidence, which was received into the record.
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, including the application of any abatement. The Senior 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 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 Commission, 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. The Hearing Officer during the evidentiary hearing made inquiry of Complainant. Respondent did not present any witnesses.
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 is 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.
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 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.” 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 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. E.D. 1980).
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).
Board Presumption and Computer-Assisted Presumption
There exists a presumption of correct assessment by the BOE. In charter counties or the City of St. Louis, there exists by statutory mandate a presumption that the Assessor’s original valuation was made by a computer, computer-assisted method or a computer program – the computer-assisted presumption. These two presumptions operate with regard to the parties in different ways. The BOE presumption operates in every case to require the taxpayer to present evidence to rebut it. If Respondent is seeking to prove a value different than that set by the BOE, then it also would be applicable to the Respondent. The computer-assisted presumption is applicable only if (1) the BOE lowered the value of the Assessor and Respondent is seeking to sustain the original assessment and (2) it has not been shown that the Assessor’s valuation was not the result of a computer assisted method. The BOE’s valuation is assumed to be an independent valuation.
In the present appeal, the BOE sustained the initial valuation of Respondent; therefore, the computer-assisted presumption is not applicable in the present appeal.
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).
Although Complainant presented evidence to support his opinion of the subject property’s TMV, that evidence is neither substantial nor persuasive because, if relied upon, the fact finder would be required to resort to speculation to conclude the TMV of the subject property on January 1, 2015, should be $2,300.
Complainant’s evidence was not substantial to support his opinion as to value. Substantial evidence is that which is relevant, adequate, and reasonably supports a conclusion. Cupples Hesse Corp., 329 S.W.2d at 702. Complainant’s opinion that the subject property had a value of $2,300 was not supported by any of the three recognized approaches to value. Complainant testified that no appraisal of the subject property had been performed within the three years prior to the evidentiary hearing.
Furthermore, Complainant’s evidence was not persuasive to rebut the presumption of true market value advocated by Respondent. Persuasive evidence is that which causes the trier of fact to believe, more likely than not, the conclusion advocated is the correct conclusion. Id. Complainant testified that he purchased the subject property in 1990 or 1991 for $18,000 with the intent to build a home on the lot. Complainant further testified and presented evidence establishing that in 1992 he had pursued a variance of the building and/or planning and zoning regulations of the City of Creve Coeur to allow for a home to be built on the lot. The 1992 request for a variance had been denied. Complainant also presented a letter dated September 25, 2015, from the Creve Coeur Director of Community Development, which stated, in pertinent part:
The property is bisected by a private road that provides access to existing residences at #2, #3, #5 Allegro Lane. As you note in your e-mails, the City of Creve Coeur has previously denied requests to allow the construction of a single family residence on this lot. In order to receive a permit to construct a residence on this lot, the building would need to conform with the zoning requirements or by the granting of an appeal for variances by the Board of Adjustment.
(Exhibit A) Neither the evidence concerning the 1992 request for a variance or the 2015 letter from the Director of Community Development conclusively showed that no home whatsoever could be built upon the subject property, thereby rendering it “unbuildable,” unusable, or valueless as contended by Complainant. Rather, the evidence indicated that Complainant could build a home as long as it either conformed to the current zoning requirements or was the result of a variance of the current zoning requirements. Complainant testified that he had not made a request for a variance of the current zoning requirements for “several years.”
Moreover, the final document contained in Exhibit A indicated that, when Complainant purchased the subject property in 1991 for $18,000, he attributed value to the subject property even though he either knew or should have known that constructing a home on the subject property might not be possible. The final document in Exhibit A was a decision of the City of Creve Coeur Board of Adjustment dated June 29, 1977, refusing to grant a previous owner of the subject property a variance in the yard requirements so that a residence could be built. The decision specifically stated:
The Board of Adjustment finds that the petitioners purchased the [subject property] with full knowledge of the conditions which presently exist and which likewise (sic) existed at the time petitioners purchased said property, that the property under consideration was subdivided contrary to state laws and city ordinances, that the granting of the variation requested by the petitioners would be detrimental to the public welfare and injurious to other property in the vicinity where the particular piece of property herein before described is situated and that the granting of the variance requested by the petitioners would constitute a granting of a mere priviledge (sic) to the petitioners.
Given that Complainant’s evidence was not substantial and persuasive to rebut the presumption that the BOE’s valuation was correct, it is reasonable to find and conclude that the TMV of the subject property on January 1, 2015, was $26,100.
The true market valuation for the subject property as determined by Respondent for the subject tax day and sustained by the BOE is AFFIRMED.
The assessed value for the subject property for tax years 2015 and 2016 is set at $4,960 residential ($26,100 TMV).
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 July 11, 2016.
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 11th day of July, 2016, to: Complainants(s) counsel and/or Complainant, the County Assessor and/or Counsel for Respondent and County Collector.