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Board of Equalization assessed commercial property values

by Jeff Haldiman | July 23, 2021 at 4:05 a.m. | Updated July 23, 2021 at 10:06 a.m.

The Cole County Board of Equalization on Thursday upheld the values of commercial properties whose assessments had been challenged for 2021.

Board of Equalization members include the three Cole County commissioners; two representatives from Jefferson City government staff if the property is in the city limits; and two at-large positions, which require someone familiar with real estate, building construction, the banking industry or land title business.

Cole County Clerk Steve Korsmeyer chairs the board, but he and Assessor Chris Estes are not voting members.

If dissatisfied with the board's decision, a property owner can appeal to the State Tax Commission and, thereafter, the circuit court.

Among the commercial property owners making appeals were those owning hotels and big-box stores.

"We started seeing the big-box store appeals in 2008, arguing that because their facility was built just to serve their needs, the property value should be lower as the building could be used to serve no other purpose," Estes said.

Assessor's Office officials said the assessments on the stores and hotels were based on the value of the land on which the buildings sit.

The assessments upheld included Lowe's on Missouri Boulevard, which the Assessor's Office valued at $9 million while the company believed the property value was $5.4 million. Kohl's on Stoneridge Parkway had an assessor's value of $6.7 million while the company valued the property at $6 million. Neither company had representatives at Thursday's proceedings.

For Fairfield Inn on West Truman Boulevard, the BOE agreed with the Assessor's Office the value of the property was $2.83 million, not the $2 million the hotel owners thought it should be. No one representing the hotel came to Thursday's proceedings, and no supporting material for the owners was presented.

The assessor's value of $9.7 million was also upheld for Capitol Plaza Hotel on West McCarty Street, whose owners believed the value was $6 million. And the BOE agreed with the assessor the Courtyard by Marriott on Bolivar Street, which opened in December, has a property value of $9.175 million. No one appeared representing either hotel.

Another commercial property the BOE upheld the assessor's value on was Texas Roadhouse on South Ten Mile Drive. It was noted in their paperwork, the company talked about lost revenues due to the COVID-19 pandemic, but it was for the Midwest in general and not specific as to what may have occurred at the Jefferson City property. The board upheld the assessor's value of $1.8 million compared to the $1.5 million value the owners believed the property was worth.

The BOE also approved some stipulation values of property. This occurred after officials from the Assessor's Office lowered their values after meetings with property owners.

One of those occurred on an office building in the 900 block of Wildwood Drive, which the assessor valued at $1.5 million while the property owner valued it at $800,000. The stipulated values the BOE approved was $1.3 million.

The BOE also approved three stipulation values on hotels owned by Vivek Puri. The DoubleTree Hotel on Monroe Street had originally been appraised at $6.6 million but was reduced to $4.6 million. The Hampton Inn on Country Club Drive was assessed at $2.9 million but was reduced to just more than $2 million. And the Comfort Suites, next door to Hampton Inn, was assessed at just more than $3 million but reduced to $1.9 million. Puri said this would help after lost revenue suffered during the pandemic.

The board also declined two requests for properties to be considered tax-exempt.

The first was for the Goodwill store on South Ten Mile Drive. Goodwill officials asked for the exemption, as they did in 2017, because Goodwill is a 501(c)(3) nonprofit group. They noted the store employs 35 people, many of whom are economically disadvantaged and/or have disabilities. Lawyers representing the Assessor's Office said the tax-exempt issue needed to be looked at further because Goodwill hasn't shown no private profit is resulting from its operation, and "its purpose may not be entirely charitable."

The BOE also denied a tax-exempt request from the Missouri Community Action Network on its new property on Emerald Lane. The network is made up of local, private, nonprofit and public agencies that work to alleviate poverty and empower low-income families. MoCAN officials said since 2010 they had not paid property taxes at their old office on Williams Street. Estes said this had nothing to do with the change in location as it was a change in legal opinion from his lawyers, who believe the organization doesn't qualify for exemption because it requires members to pay dues, and much of what it offers isn't meant for the public.

Cole County Eastern District Commissioner Jeff Hoelscher and Western District Commissioner Harry Otto voted for MoCAN to have tax-exempt status, but the remaining voting members of the BOE voted against. This included Presiding Commissioner Sam Bushman, Jefferson City Administrator Steve Crowell, Jefferson City Finance Director Margie Mueller, Dana Wildhaber representing the real estate industry, and Ken Otke representing the building construction industry.

The BOE did approve a request for tax-exempt status for multiple properties owned by Capital Region Medical Center. The hospital's attorney, Joe Bednar, said CRMC has been exempt since 1952 because it is a not-for-profit entity and doesn't turn away anyone regarding their ability to pay.

Estes apologized that Bednar and other members of the CRMC leadership team had to come to the BOE. Estes said he advised them to file the appeal because the review of CRMC's application did not get completed.

"My normal legal counsel could not work on this matter because of a conflict, and I had other attorneys who started to review the case but never finished it," Estes said. "I'd ask the BOE to go ahead and send this on to the State Tax Commission so we can get a proper review done and the commission make a decision."

"Basically what you are saying is our arguments are uncontested by you and it's your responsibility as the assessor," Bednar told Estes. "You don't have an argument against us. You're waiting for a lawyer to tell you if you were right or wrong, and I think it's inappropriate of county government and the Board of Equalization."

The BOE then voted to approve CRMC's request for tax exemption on real and personal property at 1125 Madison St., where hospital-based clinics and offices are located, and at 1500 Southwest Blvd., where Capital Family Care Medical Clinic is located. The BOE also approved personal property tax exemptions at Capital Region Clinic located in the 3700 block of West Truman Boulevard, 1700 block of Christy Drive, 900 block of Eastland Drive, 3300 block of West Edgewood Drive, 1000 block of Madison Street and 400 block of East High Street.

Bushman abstained from voting on this matter as he is a former member of the Capital Region Board of Directors.

Because the BOE found CRMC should be given an exemption, the assessor has no right to appeal to the State Tax Commission.

The Assessor's Office recently concluded 45 informal hearings with residential property owners regarding 2021 assessments, Estes said.

"There's no statutory provision for doing these, but we want to know if there is a problem and certify values that can save both sides from going through an appeal," he said. "Ninety-five percent of the time our values are being upheld by the BOE or the State Tax Commission if they are taken to those entities."

Estes said his office sends notices only for increases, not if there was a decrease in value or if the assessed value stayed the same.

Notices were sent for 1,303 of 39,408 parcels in Cole County.

Only one residential property owner requested a hearing before the BOE. Steve Rackers, who has a home and acreage on Wardsville Road, asked the board to adjust the assessor's appraised value of $93,400, saying he is not occupying the home and it has plumbing and foundation work to be done on it. Assessor's Office officials noted while work on the property is continuing, the residence would not be considered unlivable. The BOE upheld the assessor's value.

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