Source: https://stc.mo.gov/legal/haskell-nancy-allen-v-jake-zimmerman-assessor-st-louis-county/
Timestamp: 2019-04-26 14:27:08+00:00

Document:
The assessment made by the Board of Equalization of St. Louis County (BOE) is SET ASIDE. Complainants Haskell and Nancy Allen (Complainants) did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE and to establish the true value in money (TVM) of the subject property as of January 1, 2017. Respondent Jake Zimmerman, Assessor, St. Louis County, Missouri, (Respondent) presented substantial and persuasive evidence rebutting the presumption of correct assessment by the BOE and establishing the TVM of the subject property as $394,000 ($74,860 assessed value) as of January 1, 2017.
Haskell Allen (Complainant) appeared pro se; Nancy Allen appeared not.
Respondent appeared by Counsel Steven Robson.
Complainants appealed on the ground of overvaluation. Respondent initially set the TVM of the subject property, as residential property, at $413,600. The BOE set the TVM at $413,600, thereby sustaining Respondent’s valuation. 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 or improvement to the property. Section 137.115.1 RSMo The State Tax Commission (STC) takes this appeal to determine the TVM for the subject property as the property existed on January 1, 2017, under the economic conditions as they existed on January 1, 2017.
Jurisdiction. Jurisdiction over this appeal is proper. Complainants timely appealed to the State Tax Commission.
Evidentiary Hearing. The issue of overvaluation was presented at an evidentiary hearing on October 4, 2018, at the St. Louis County Government Administration Building, 41 South Central Avenue, Clayton, Missouri.
Assessment. Respondent initially valued the subject property at $413,600 residential, as of January 1, 2017.
Board of Equalization. The BOE valued the subject property at $413,600.
On cross examination, Complainant testified that he saw a “for sale” sign for the subject property when driving through the neighborhood. He immediately called the realtor.
On re-direct examination, Complainant testified that he wrote an offer on the subject property the same day he saw a “coming soon” sign. Complainant testified that he had been looking in the subject property’s neighborhood because he was downsizing and the home would be affordable. Complainant testified that the list price was $300,000 but that he negotiated a purchase price of $285,000 through seller credits. Complainant testified that he just happened to get to the subject property before anyone else made an offer on it.
On re-cross examination, Complainant testified that he did not know the name of the seller but that he knew the subject property had been a rental property prior to its sale.
Unlike the subject property, Comparable No. 4, the “tear down,” was .25 miles from the subject property and did not back to the highway. Comparable No. 4 consisted of an approximately 28,575 square foot (.656 acre) residential lot improved by a 2,737 square foot, single-family, ranch-style home built around 1955. (Exhibit A) Although the sale listing provided basic information describing the residence, the sale listing remarked “FOR COMP PURPOSES ONLY. VALUE IS IN THE LAND.” (Exhibit A) Comparable No. 4, sold for $275,000 on October 31, 2016. (Exhibit A) However, according to Complainant’s Exhibit A, Comparable No. 4 did not enter the market until November 1, 2016, one day after its sale date. (Exhibit A) The property record card in the St. Louis County Real Estate Information Database recorded the 2016 sale as “land only” and “not open market.” The property record card recorded a valid sale of Comparable No. 4 in the amount of $350,000 on October 27, 2017.
Respondent also presented the testimony of certified real estate appraiser Barry Hough (the Appraiser). The Appraiser testified that the primary issue regarding the value of the subject property was that it “backs to” an interstate. On cross examination, the Appraiser testified that some of Respondent’s comparable properties were located in Richmond Heights and some were located in Ladue. The Appraiser testified that there was no significant difference in value based on the comparables’ location in one municipality versus the other. The Appraiser testified that the subject property is actually located in the Ladue School District. The Appraiser testified that he did not use Complainant’s Comparable No. 2, which was on the same street as the subject property, because it had sold outside the timeframe for a 2017 valuation and differed “too much physically” from the subject property. The Appraiser considered the property an “outlier” that could have been priced significantly higher or lower than the subject property.
On redirect examination, the Appraiser testified that Complainant’s purchase of the subject property in March 2014 was not used in the appraisal report because it was not a standard market transaction as it had sold before being exposed to the market.
Presumption of Correct Assessment Rebutted – Value Established. Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the BOE. Respondent presented substantial and persuasive evidence establishing that the TVM of the subject property was $394,000 as of January 1, 2017, which was approximately 5% lower than the BOE’s valuation.
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.
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).
Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the BOE, 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, Inc., 564 S.W.2d at 895; Cupples-Hesse, 329 S.W.2d at 702; Brooks, 527 S.W.2d at 53.
In this case, Respondent presented substantial and persuasive evidence, the Appraiser’s report and the testimony of the Appraiser, establishing that the TVM of the subject property was $394,000 as of January 1, 2017, $19,600 less (approximately 5% lower) than the BOE’s determination of TVM.
There exists a presumption of correct assessment by the BOE – the BOE presumption. 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, and both Complainant and Respondent are now seeking to reduce the BOE’s valuation; therefore, the BOE presumption applies to Complainant and Respondent.
“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.
Complainant’s evidence was neither substantial nor persuasive to support an opinion as to the TVM of the subject property as of January 1, 2017. Substantial evidence is that which is relevant, adequate, and reasonably supports a conclusion. Cupples Hesse Corp., 329 S.W.2d at 702. 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’s Exhibit A resembled the sales comparison method of valuation in that it presented a range of sale prices of comparable properties, $205,000 to $352,500, but the exhibit was not an appraisal report conforming to USPAP and did not make any market-based adjustments to account for similarities and differences between the comparable properties and the subject property. Although Comparable No. 2 was a neighboring property and backed to the highway, it had a dramatically smaller lot and a smaller residence than the subject property. Comparable No. 2 sold in October 2014, more than two years prior to the tax date at issue in this appeal, for $205,000. Comparable No. 3 was across the street from the subject property and did not back to the highway. Comparable No. 3 sold in August 2014 for $223,000 but sold again in 2016, closer in time to the tax date, for $455,000. Comparable No. 4 was a “tear down” lot. Comparable No. 4 sold in October 2016, for $275,000, but the sale was not open market due to its lack of exposure on the market. It sold again, in October 2017, closer in time to the tax date and in an open market sale, for $350,000. The sale prices of valid comparable sales closer in time to the relevant tax date carry more weight than earlier sales and non-market sales.
Importantly, the 2014 sale price of the subject property does not weigh heavily in the determination of the subject property’s TVM on January 1, 2017. The evidence in the record as a whole implied that sale in March 2014 was not an open market sale. Complainant testified that he had been looking for a property in the subject property’s neighborhood; that he had made an offer upon seeing a “coming soon” sign; that he knew the subject property had been a rental property before he purchased it; and that he made a full-price offer and later negotiated $15,000 of seller credits. This evidence leads to the reasonable conclusion that the purchase did not represent a transaction between a typical buyer and seller and that reasonable time was not allowed for exposure in the open market.
The TVM for the subject property as determined by the BOE is SET ASIDE. The assessed value for the subject property is $74,860 residential ($394,000 TVM), as of January 1, 2017, and January 1, 2018.
SO ORDERED December 4, 2018.
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 4th day of December, 2018, to: Complainants(s) counsel and/or Complainant, the County Assessor and/or Counsel for Respondent and County Collector.
 On the Complaint for Review filed with the STC, Complainants proposed a TVM of $285,000, which was lower than the opinion of TVM Complainant presented at the Evidentiary Hearing.
 Respondent objected to Complainant’s live testimony on the ground that no Written Direct Testimony had been filed pursuant to the deadlines contained in the scheduling order. The Hearing Officer noted the objection reserving a ruling for the Decision and allowed Complainant to testify only to the extent of explaining the specific exhibits being presented, which had been pre-filed without objection, and subject to cross examination. Respondent’s objection to Complainant’s live testimony is hereby overruled.

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