IN THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI AT KANSAS … · property owner for approximately...

IN THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI AT KANSAS CITY

STATE OF MISSOURI EX. REL. ) ) EVELYN BRAVO, ) ) GEORGE MORALES, ) ) LUCY AVILA, ) ) IVANHOE NEIGHBORHOOD ) COUNCIL, ) ) and ) ) WESTSIDE NEIGHBORHOOD ) ASSOCIATION )

) Relators, )

) v. )

) BOARD OF EQUALIZATION ) Case No.: OF JACKSON COUNTY, MISSOURI, )

) CHRISTOPHER R. SMITH ) Div.: In his official capacity as Chairman ) of the Board of Equalization, )

) MARILYN M. SHAPIRO ) In her official capacity as Vice-Chair ) of the Board of Equalization, )

) and )

) FORESTINE A. BEASLEY ) In her official capacity as Member ) of the Board of Equalization, )

) Respondents. )

PRELIMINARY ORDER IN MANDAMUS The State of Missouri to Respondent _______________________________________________ _____________________________________________________________________________.

You are hereby directed to file your pleading to the petition in mandamus on or before the expiration of 7 days from the date of service and to serve a copy of your pleading upon Michael Duffy, attorney for Relators, whose address is 920 Southwest Boulevard, Kansas City, Missouri 64108. If you fail to do so, judgment by default will be taken against you for the relief demanded in the petition.

Judge Dated Directions to the Clerk The clerk shall insert in the preliminary order in mandamus the names of only the respondent or respondents who are to be personally served by the officer to whom the preliminary order is delivered. The preliminary order should be signed by the judge under seal of the court and a copy of the preliminary order and a copy of the petition for each of such respondents should be delivered along with the original preliminary order to the officer or the person who is to make service. The copy of the preliminary order may be a carbon or other copy and should be signed and sealed in the same manner as the original but it is unnecessary to certify the same is a true copy. The copy of the petition may be a carbon or other copy and should be securely attached to the copy of the preliminary order but need not be certified a true copy. If relator has no attorney, the address of relator should be stated in the preliminary order, and the words "attorney for" eliminated. (See Rules 54, 94.05 and 94.06)

Return on Service of Preliminary Order I hereby certify that I have served the within preliminary order in mandamus: (1) By delivering on the day of _____________, 2020 a copy of the preliminary order and a copy of the petition to the within-named respondent; (2) By leaving on the day of _______________, 2020 for each of the within-named respondent, a copy of the preliminary order and a copy of the petition at the respective dwelling place or usual place of abode of said respondents with some person of his or her family over the age of 15 years; (3)

All done in Jackson County, Missouri Sheriff of Jackson County, Missouri By:

Sheriff's fees: Preliminary Order ) Non est ) Mileage ) Total )

Directions to Sheriff A copy of the preliminary order and a copy of the petition must be served on each respondent. For methods of service in all civil actions see Rule 54.

) Relators, )

) v. )

) and )

) Respondents. )

PETITION FOR DECLARATORY JUDGMENT AND WRIT OF MANDAMUS

COME NOW, Relators Evelyn Bravo, George Morales, Lucy Avila, Ivanhoe

Neighborhood Council, and the Westside Neighborhood Association, by and through

undersigned counsel, and hereby state as follows for their Petition for Declaratory Judgment and

Writ of Mandamus against Respondents Jackson County, Missouri Board of Equalization,

Christopher R. Smith, Marilyn M. Shapiro, and Forestine A. Beasley in their official capacities

as chair, vice-chair, and member, respectively, of the Jackson County, Missouri Board of

Equalization (collectively the “Board”) for failing to perform their duty to equalize residential

real property values in Jackson County, Missouri for the tax year 2019, as required by law.

PARTIES

1. Relator Evelyn Bravo, an 80-year old widow, is a resident and has been a property

owner for approximately 35 years at 1642 Jefferson St, Kansas City, Jackson County, whose

home the Assessor valued in 2018 at $54,551 and in 2019 at $246,522, an increase of 352%.

This led to an estimated increase in her home property tax from $860 to $3,887. Her annual

income is approximately $21,804 per year from social security.

2. Relator George Morales, an 86-year old widower, is a resident and has been a

property owner for approximately 25 years at 2112 Summit Street, Kansas City, Jackson County,

whose home the Assessor valued in 2018 at $104,277 and in 2019 at $189,402, an increase of

82%. This led to an estimated increase in his home property tax from $1,644 to $2,986. His

annual income is approximately $16,800 per year from social security.

3. Relator Lucy Avila, an 86-year old widow, is a resident and has been a property

owner for approximately 47 years at 2019 Jefferson St, Jackson County, Kansas City, whose

home the Assessor valued in 2018 at $67,840 and in 2019 at $219,638, an increase of 224%.

This led to an estimated increase in her home property tax from $1,069 to $3,463. Her annual

income is approximately $24,000 per year from her deceased husband’s Railroad Retirement

pension.

4. Relators Evelyn Bravo, George Morales, and Lucy Avila seek the issuance of a

Declaratory Judgment and Writ of Mandamus in their individual capacities and on behalf of the

public at large of Jackson County, Missouri.

5. Relator Ivanhoe Neighborhood Council, with its address at 3700 Woodland

Avenue, Kansas City, Jackson County, is a nonprofit 501(c)(3) corporation, whose mission

includes the preservation of residential integrity of the Ivanhoe Neighborhood, which is bounded

by Prospect Avenue on the East, The Paseo on the West, 31st Street on the North, and Emmanuel

Cleaver II Blvd. on the South, a predominantly African-American neighborhood.

6. Relator Westside Neighborhood Association, with its address at 2106 Holly

Street, Kansas City, Jackson County, is a nonprofit corporation, whose mission includes the

preservation of residential integrity of the Westside Neighborhood, which is bounded by

Broadway on the East, Beardsley Road/Allen Avenue/Southwest Blvd. on the West, 13th Street

on the North, and 31st Street on the South, a predominantly Hispanic neighborhood.

7. Respondent Jackson County, Missouri Board of Equalization is a quasi-judicial,

administrative body of Jackson County, Missouri created by state statute to hear market

valuation appeals and to equalize property values upon all property classifications within Jackson

County so that they are entered on the tax books at their true value.

8. Respondents Christopher R. Smith, Marilyn M. Shapiro, and Forestine A. Beasley

are the Chair, Vice-Chair, and Member, respectively, of the Jackson County, Missouri Board of

Equalization.

JURISDICTION AND VENUE

9. This Court has subject matter jurisdiction over this action, in that is has subject

matter jurisdiction over all civil cases and matters and to issue and determine original remedial

writs.

10. This Court has personal jurisdiction over all parties, in that the Jackson County

Board of Equalization is situated within and part of the government of Jackson County and its

members are domiciled in Missouri.

11. Jackson County is the proper venue in that the Chair, Vice-Chair, and Member are

residents of and maintain their offices in Jackson County, Missouri.

REQUEST FOR DECLARATORY JUDGMENT

12. Relators are residents of the homes they own in Jackson County, or nonprofit

corporations, whose rights are affected by the failure of the Board to perform its duty to equalize

residential real property values in Jackson County for the tax year 2019, as required by law.

13. The 2019 Assessment was systematically discriminatory against a substantial

group of Jackson County residential taxpayers in that:

a. There is significant and illegal market value regressivity in the

predominantly African American and Hispanic areas of the County, meaning that

lower-income homes in these areas were appraised at a much higher percentage of

their fair market value than higher-value homes in these areas — and in the

County overall. This pattern led to assessment increases very often exceeding

100% on households unprepared for the consequent tax increases;

b. The Assessor over-appraised residential properties in the predominantly

African American and Hispanic areas of the County 43% more often than in the

rest of the County;

c. The Assessor badly failed to meet appraisal requirements of uniformity in

the predominantly African American and Hispanic areas of the County, where the

uniformity failure rate was more than three times higher than in the County as a

whole.

d. The Assessor capped appraised increases at 14.9% for 54% of the

properties that increased by 14.9% or more in the non-African American and

Hispanic areas of the County, compared to only 1% of such properties within that

minority area, thus ensuring that the extremely large increases fell more heavily

there.

14. The Board has a duty to correct area-wide, systemic discriminatory assessments

through the entry of an intra-county order of equalization.

15. The Board has been made aware of its duty.

16. The Board has failed to act.

17. Relators’ rights and property and the rights and property of all Jackson County

residential property taxpayers are affected by the Board’s failure.

REQUEST FOR WRIT OF MANDAMUS

18. The 2019 Assessment was discriminatory.

19. The Board has been made aware of its duty to correct discrimination through the

entry of an intra-county order of equalization.

20. The Board has failed to act.

21. Because the 2019 Assessment disproportionately affects low-income tax payers,

paying the new, higher taxes under protest is not a viable solution because most bills are for an

amount greater than what taxpayers are able to pay; and if unable to pay, causing imposition of

penalties, fees, and interest, and ultimately loss of the home through tax foreclosure.

22. Because the Board has failed to exercise its duty to act, a writ of mandamus

ordering the Jackson County Board of Equalization enter an intra-county order of equalization is

the sole available remedy.

23. Relator has exhausted all other available remedies. But for court intervention

through issuance of a writ, irreparable harm will occur.

PRAYER FOR RELIEF

WHEREFORE, Relators requests that this Court:

1. Issue a Declaratory Judgment, making findings of fact and conclusions of law,

holding that the Assessor has systematically discriminated against a substantial group of Jackson

County residential taxpayers, and the Board has both the authority to enter intra-county orders of

equalization, equalizing residential real property values in Jackson County, Missouri for the tax

year 2019, so that all the property affected by such an order shall be entered on the tax book free

of discrimination and that the Board has the duty to enter such an order;

2. Issue a preliminary order in mandamus directing the Board of Equalization to file

an answer to this Petition within the time set by the Court for a response;

3. Issue a permanent writ of mandamus ordering the Board of Equalization to enter

an Order of Intra-County Equalization, eliminating the discriminatory nature of the 2019

Assessment by equalizing residential real property assessment values within Jackson County, in

a manner to be determined by the Board consistent with law;

4. Order that Jackson County pay the costs incurred by Relators in this matter; and

5. Grant such further relief as the Court deems just and proper under the

circumstances.

DATED this 31st day of December, 2019.

Respectfully submitted,

/s/ Michael Duffy Michael Duffy, MO Bar #28511 Legal Aid of Western Missouri

920 Southwest Boulevard Kansas City, Missouri 64108 PHONE: (816) 474-9868 FAX: (816) 474-7575 mduffy@crn.org

ATTORNEY FOR PLAINTIFFS

Brandon C. Mason, MO Bar #69216 Legal Aid of Western Missouri

920 Southwest Boulevard Kansas City, Missouri 64108 PHONE: (816) 474-9868 FAX: (816) 474-7575 bmason@lawmo.org

/s/ Joshua Walburn Joshua Walburn, MO Bar #69413 Legal Aid of Western Missouri

920 Southwest Boulevard Kansas City, Missouri 64108 PHONE: (816) 474-9868 FAX: (816) 474-7575 jwalburn@lawmo.org

) Relators, )

) v. )

) and )

) Respondents. )

SUGGESTIONS IN SUPPORT OF PETITION FOR DECLARATORY JUDGMENT AND WRIT OF MANDAMUS

Relators Evelyn Bravo, George Morales, Lucy Avila, Ivanhoe Neighborhood Council, and

Westside Neighborhood Association (collectively, “Relators”) state as follows in support of their

Petition for Writ of Mandamus against Respondents the Board of Equalization of Jackson County,

Missouri and Christopher R. Smith, Marilyn M. Shapiro, and Forestine A. Beasley in their official

capacities as chair, vice-chair, and member, respectively, of the Jackson County Board of

Equalization (collectively, the “Board”). Relators seek a declaratory judgment and an order

compelling the Board to enter an intra-county equalization order remedying systematic and

widespread discrimination by the Jackson County Assessment Department (the “Assessor’s

Office”) in the 2019 residential real property reassessment (the “2019 Assessment”).

FACTUAL BACKGROUND

Pursuant to §137.115, RSMo, every Missouri county is required to perform a bi-annual

assessment of all real property located within the county’s boundaries. The Assessor’s Office,

directed by Gail McCann Beatty (the “Assessor”), is responsible for the valuation of all real

property situated in Jackson County, Missouri. In 2019, the Assessor’s Office performed their

2019 Assessment, which contained numerous errors and inconsistencies regarding market

valuations of residential real property (the “Market Value”). Beginning on or about June 7, 2019,

property owners in Jackson County, Missouri began to receive their Notice of Assessment by mail,

indicating, among other things, the Market Value assigned by the Assessor’s Office for the

individual taxpayer’s property as part of the 2019 Assessment.

Upon receiving the notice, a property owner has the option to pursue administrative review

of their property’s Market Value if the owner disagrees with the estimated valuation. The first

review available is an informal review process within the Assessor’s Office (the “Informal

Request for Review”). Following the 2019 Assessment, approximately 22,000 taxpayers filed an

Informal Request for Review—a record number—alleging, among other things, incorrect

valuations of the requesting property owners’ property. At a December 6, 2019 procedural meeting

before the Board, the Assessor informed the Board that there were still Informal Requests for

Review pending with the Assessor’s Office.

Regardless of whether or not a taxpayer files an Informal Request for Review, pursuant to

§137.180 RSMo., taxpayers may appeal the valuations established by the Assessor’s Office to the

Board by submitting a “Board of Equalization Market Value Appeal Application” (the “Appeal”).

The Board is a quasi-judicial political body that has statutory authority to “hear complaints and

equalize the valuation and assessments upon all real and tangible personal property taxable by the

county so that all the property shall be entered on the tax book at its true value.” §138.030.2,

RSMo. “[The Board’s] mission is to fully and fairly equalize the value of all real and tangible

personal property in the county for purposes of taxation and to provide an appeal forum for

taxpayers to correct perceived inequities in the assessment of value.” Board of Equalization,

https://www.jacksongov.org/330/Board-of-Equalization (last visited December 30, 2019). The

Board serves as an oversight authority regarding assessments made by the Assessor’s Office in

Jackson County, which it carries out by equalizing property valuations among taxpayers.

Following the 2019 Assessment, the deadline for filing an Appeal with the Board was July

8, 2019. Due to a record number of appeals and public outcry, the Board extended the deadline by

which to appeal until July 29, 2019, and subsequently again until September 3, 2019. To date, the

Jackson County Board of Equalization has received approximately 18,099 Market Value Appeal

Applications, a record number by historic norms.

Despite the high number of formal appeals filed with the Board, this number represents

only a fraction of taxpayers who are negatively impacted by the flawed assessment. Many

thousands of homeowners failed to appeal their value increases for numerous reasons, including:

a. those unable to afford an independent appraisal which is typically submitted with a

market value appeal;

b. those unable to read the assessment notices because of literacy issues or because

they are not native English speakers and the notices were only sent in English;

c. those who misunderstood the original mailing by the Assessor’s Office which

declared itself “Not a Bill”, resulting in their mistaken belief that the assessment

notices did not demand immediate action;

d. those taxpayers who did not receive their assessment notice due to it being lost in

the mail; and

e. those who were unable to appeal–formally or informally–within the very short

deadline initially stated–under 10 days. And none of these taxpayers received

formal notice of the deadline extension.

Due to the record number of appeals, the Board cannot hear all of the currently pending

appeals until well into 2020, and the Board may yet receive more appeals. The Jackson County

Executive’s office reported December 23, 2019 that the Assessor just “discovered” 8,600 unread

emails directed to the Board which may contain unread appeals. Taxpayers who have not received

a decision on their Informal Request for Review are still eligible to file appeals with the Board

within thirty days of the decision by the Assessor’s Office. The Board also permits taxpayers to

file appeals out of time at the discretion of the Board, although the Board has not given public

notice of this policy. Therefore, as taxpayers begin to receive their tax bills from the Jackson

County Collections Department, the number of formal appeals is likely to increase. After the Board

has rendered a decision regarding a specific property, the owner of that property has the option to

appeal the decision to the State Tax Commission as the last administrative remedy available to

taxpayers.

The source of the record number of appeals is rooted in the extraordinary increases and

variability in valuations issued by the Assessor’s Office. Many individual residential properties

were seeing increases in excess of 600%, and vacant lots were seeing increases in excess of 1,000%

when compared with their 2018 market values assigned by the Assessor’s Office.

Recognizing the systematic nature of the failure of the Assessor’s Office and the size of

the impacted population, an interested third party retained the services of Mr. Josh Myers, a

statistician and mathematician with expertise in mass appraisal methods employed by assessors’

offices across the country.

Mr. Myers performed a statistical analysis of the 2019 Assessment that compared Market

Values in an area roughly bound by Independence Avenue on the north, Blue Ridge Cutoff on the

east, 85th Street and the Grandview Triangle to the south, Troost Avenue to the west and includes

the Westside Neighborhood, which is bounded by Broadway on the East, Beardsley Road/Allen

Avenue/Southwest Blvd. on the West, 13th Street on the North, and 31st Street on the South, (the

“Subject Area”) with Market Values in the rest of Jackson County. Census data indicates that the

Subject Area is comprised of majority-minority census tracts (principally African American and

Hispanic residents), while the remainder of the county is comprised mostly of residents not from

a racial minority group. A map of the Subject Area is attached hereto as Exhibit 1, and a map

illustrating racial makeup by census tract is attached hereto as Exhibit 2.

To perform his analysis, Mr. Myers utilized data from several sources available to the

public: property sales data (sale dates, validity codes, sale prices, etc.), a list of all residential real

property in Jackson County, 2019 Updated Fall Tax Values, GIS files, and the 2017 and 2019

Basic Tax Roll Info, which contain property values along with some basic information about the

property type and location for the 2017 and 2019 re-assessments. The 2019 Basic Tax Roll Info

contained an earlier version of the 2019 values that were superseded by the 2019 Updated Fall Tax

Values.

Mr. Myers compiled the results of his research into a three-page memorandum titled

“Preliminary Conclusions with Regard to the Target Area in Jackson County, MO” (the “Subject

Area Report”). A copy of Mr. Myers’s Subject Area Report is attached hereto as Exhibit 3. Mr.

Myers’s findings, as detailed in the Subject Area Report, indicate the Assessor’s Office failed to

comply with standards set by the International Association of Assessing Officers (the “IAAO”)1,

and taxpayers and properties within the Subject Area were treated differently than properties in

the rest of the County, as explained below.

The Subject Area Report illustrates three significant deficiencies in the 2019 Assessment.

First, Assessor’s Office badly failed to meet appraisal standards of uniformity in the Subject Area,

in that the coefficient of dispersion, an overall measure of appraisal uniformity, is approximately

49% in the Subject Area, and approximately 14% in the rest of the County. The value of the

coefficient of dispersion for the rest of the County falls just within the IAAO standard range for

residential property (5% to 15%), but the value of the coefficient in the Subject Area far exceeds

the standard range. Hence, the Market Values in the Subject Area are much more variable in

relation to actual market sales values than industry standards permit. This level of variability in

1 Appraisal standards issued by the IAAO have been cited with approval by the Missouri Supreme Court. See Savage v. State Tax Commission, 722 S.W.2d 72, 77 (Mo. 1986).

the Subject Area means that some properties in the Subject Area are appraised well below their

fair market value and some properties in the Subject Area are appraised at well above their fair

market value. This failure to uniformly appraise properties by the Assessor’s Office, however, is

not present outside of the Subject Area, demonstrating that the Subject Area was treated differently

by the Assessor’s Office than the rest of the County. See Subject Area Report, pg. 2.

Second, the coefficient of price-related bias, a measure of market value vertical inequity,

i.e., regressivity, is approximately -0.252 in the Subject Area and 0.002 in the rest of the County.

The coefficient of price-related bias in the rest of the County falls within the IAAO standard range

(-0.10 to 0.10), indicating little to no vertical inequity there. The value in the Subject Area,

however, falls outside of the IAAO standard range and indicates that lower valued homes in the

Subject Area are appraised at a much higher percentage of their fair market value than higher

valued homes in the Subject Area. That there is significant market value regressivity in the Subject

Area but virtually no regressivity in the rest of the County further demonstrates that the Subject

Area was treated differently by the Assessor’s Office than the rest of the County.

Third, the Assessor’s Office applied a blanket appraisal value cap much more frequently

outside of the Subject Area than within. Of those properties designated by a computer algorithm

to increase in value from the 2018 Market Value by 15% or more, only 1.33% of such properties

in the Subject Area received the appraisal cap of a 14.9% increase, while 54.5% of such properties

in the rest of the County had their values capped at a 14.9% increase. See Subject Area Report, pg.

3. Additionally, the Assessor’s Office over-appraised residential properties in the Subject Area

43% more often than in the rest of the county.

Taken together, the findings evidenced in the Subject Area Report indicate that the

discrimination inherent in the 2019 Assessment results in a disproportionate tax burden on Jackson

County’s poorest citizens residing in the county’s majority-minority neighborhoods.

On or about October 7, 2019, the Assessor explained the application of the 14.9% cap

during testimony before the Missouri House of Representatives’ Special Interim Committee on

Oversight of Local Taxation, a committee formed to, among other things, investigate possible

legislative action on property taxes. The Assessor testified that roughly “30% of parcels increased

over 15%...” under the algorithm used to initially determine Market Values. Increases of 15% or

more would require the Assessor’s Office to physically inspect the property, pursuant to

§137.115(10) RSMo., a more time-consuming process. In describing how the 2019 Assessment

purported to comply with this requirement, the Assessor testified that the Assessor’s Office

“[s]tarted with the parcels that had the greatest and most significant increases… Unfortunately, we

ran out of time. And so, you do see some parcels in our case that are at the 14.9% increase. But

those are parcels that likely would have only increased from 15 to 25 percent otherwise anyway.”

The end result was that approximately 74,311 parcels in Jackson County received a Market Value

in the 2019 Assessment that was an exact 14.9% increase over 2018 Market Value, almost all of

which were located outside of the Subject Area.

In an effort to address the problems in the 2019 Assessment, on or about October 23, 2019,

Legal Aid of Western Missouri, on behalf of its clients, submitted to the Board a “Memorandum

of Law” detailing the Board’s authority to issue intra-county orders of equalization to correct the

wide-spread discrimination en mass. Similar memoranda were also submitted by the Polsinelli law

firm and legal counsel to the Board on or about November 4, 2019.

On or about November 4, 2019, Legal Aid of Western Missouri, again on behalf of its

clients, submitted to the Board a “Request for Order” seeking relief from the discriminatory effects

of 2019 Assessment through the entry of an Order of Intra-County Equalization of Value for

Certain Residential Real Property in Jackson County, Missouri (the “Request for Order”). A copy

of that Request for Order is attached hereto as Exhibit 4. The Request for Order detailed the

discriminatory nature of the 2019 Assessment, the 2019 Assessment’s disparate impact upon

minority and low-income populations, and the Board’s legal duty to correct the discriminatory

effects of the 2019 Assessment. Entering an intra-county equalization order, such as the order

sought in the Request for Order, which would eliminate discrimination in the 2019 Assessment is

within the Board’s statutory authority.

On or about November 21, 2019, the Board held a special hearing to receive testimony

from representatives from Legal Aid of Western Missouri, the Polsinelli law firm, and the Jackson

County, County Counselor’s Office. At that November 21, 2019 special hearing, the Board heard

testimony as to discriminatory nature of the 2019 Assessment, including a discussion of Mr.

Myers’s data outlined in the Request for Order, and the Board’s duty to issue intra-county orders

of equalization to correct such discrimination. On or about December 10, 2019, Legal Aid of

Western Missouri, on behalf of its clients, e-mailed to the Board the “Supplemental Testimony

Following Special Hearing of the Board of Equalization”, which reiterated to the Board that the

2019 assessment was discriminatory, and therefore unlawful, and that in the face of discrimination

the Board has a duty to act. A copy of that Supplement is attached hereto as Exhibit 5.

To date, the Board has been made aware of its authority and duty to act to correct the

discriminatory 2019 Assessment on at least six occasions. Despite repeated demonstrations of

these facts, the Board has refused to correct the discrimination inherent in the 2019 Assessment by

equalizing property values, whether by adoption of the proposed order or by any other

comprehensive means.

By law, citizens are required to pay their taxes. Tax bills for property taxes flowing from

this fraudulent assessment are due and owing to the Jackson County Department of Collections on

December 31, 2019.

MANDAMUS LEGAL STANDARD

“A writ of mandamus may issue ‘to compel the performance of a ministerial duty that one

charged with the duty has refused to perform.’” Riley v. City Adm’r of City of Liberty, 552 S.W.3d

764, 766 (Mo. App. W.D. 2018) quoting State ex rel. Deckard v. Schmitt, 532 S.W.3d 170, 174

(Mo. App. W.D. 2017). When seeking the enforcement of a private right, “[f]or a court to issue a

writ of mandamus, ‘there must be an existing, clear, unconditional legal right in relator, and a

corresponding present, imperative, unconditional duty upon the fact of respondent, and a default

by respondent therein.’” Id. quoting State ex rel. Isselhard v. Dolan, 465 S.W.3d 496, 498 (Mo.

App. E.D. 2015).

Conversely, “[w]here a public right is involved, and the object is to enforce a public duty,

the people are regarded as the real party [in interest] and in such case the relator need not show

any legal or special interest in the result.” (Emphasis added) State ex rel. Taylor v. Wade, 231

S.W.2d 179, 182 (Mo. Banc 1950). This is because “public officers are required to perform

mandatory duties of the office imposed by the Legislature (which are ‘of a public nature affecting

the people at large’) without any special request or demand from anyone.” State ex rel. Taylor v.

Wade, 231 S.W.2d 179, 182 (Mo. Banc 1950). Thus, “a narrow window exists by which even a

member of the general public may seek mandamus against a public official.” State ex rel. City of

Cabool v. Texas County Bd. of Equalization, 850 S.W.2d 102, 105 (Mo. Banc 1993).

Mandamus will not ordinarily issue to control the discretion of an administrative body.

State ex. rel. Keystone Laundry and Dry Cleaners, Inc. v. McDonnell, 426 S.W.2d 11, 14

(Mo.1968). An exception to this general rule exists when “the administrative board (or court) has

acted unlawfully or wholly outside its jurisdiction or authority or has exceeded its jurisdiction, and

also where it has abused whatever discretion may have been vested in it.” Keystone Laundry at 14.

“In short, while mandamus will not ordinarily lie to control the exercise of discretionary power, it

will issue to command performance of duties when that discretionary power is exercised with

manifest injustice.” State ex rel. Diners’ Financial Corporation v. Swink, 434 S.W.2d 593, 597

(Mo.App. 1968). Finally, mandamus is also proper where the … tribunal has refused to exercise

its discretion, or where it has refused to act where it has a duty to act. State ex rel. Byrd v.

Chadwick, 956 S.W.2d 369 (Mo.App.W.D., 1997).

ARGUMENT

State statute directs that the Board “shall hear complaints and equalize the valuation and

assessments upon all real and tangible personal property taxable by the county so that all the

property shall be entered on the tax book at its true value.” §138.030.2, RSMo. In fulfilling the

duty to equalize property valuation and assessments, the Board “shall raise the valuation of all

tracts or parcels of land and all tangible personal property as in their opinion have been returned

below their real value…and shall reduce the valuation of such tracts or parcels of land or any

tangible personal property which, in their opinion, has been returned above its true value.”

§138.050, RSMo. If a board of equalization fulfills these duties, discriminatory assessments will

not stand because such assessments cannot be reconciled with all properties being assessed in the

same manner, i.e., at their true value in money. As explained below, if a board of equalization

allows discriminatory assessments to stand, it has failed to satisfy its statutory mandate, and

therefore mandamus is appropriate to compel the Board to take action sufficient to excise

discrimination within the 2019 Assessment.

I. The 2019 Assessment was discriminatory in that properties within the same class were treated differently when establishing their basis for taxation

In the context of property assessments for the purposes of taxation, there are two alternate

ways in which discrimination can be proven. (1) By demonstrating that valuations are so

inconsistent and arbitrary that they could not possibly be the result of an honest exercise of

judgment and are therefore presumed, in effect, to be intentionally discriminatory; or (2) by

demonstrating an intentional and systematic undervaluation of one kind or species of property as

compared to the rest of the property within the same class. As explained hereinafter, there is

substantial and competent evidence of discrimination under both discrimination theories in the

2019 Assessment.

a. The 2019 Assessment resulted in property valuations that are so arbitrary that they cannot be the result of an honest exercise of judgment, thereby demonstrating discrimination by the Assessor’s Office

The 2019 Assessment produced property valuations that are wholly inconsistent with an

honest exercise of judgment and are therefore discriminatory. A mere overvaluation of a specific

property does not establish a discrimination in the absence of a showing of an intentional plan of

discrimination. Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 700 (Mo. 1959).

For inaccurate assessments to raise to the level of discrimination, there must be competent and

substantial evidence of “something which in effect amounts to an intentional violation of the

essential principle of practical uniformity.” Savage v. State Tax Commission of Missouri, 722

S.W.2d 72, 78 (Mo. 1986). Competent and substantial evidence is “evidence which, if true, has

probative force upon the issues.” Collins v. Division of Welfare, 270 S.W.2d 817, 820 (Mo. banc

1954). Such evidence must demonstrate that assessments are so inaccurate “as to be entirely

inconsistent with an honest exercise of judgment.” Cupples Hesse, at 700.

The standard of “an intentional plan of discrimination” requires some explanation. In

Savage, the State Tax Commission found the Springfield Assessor assessed a taxpayer’s property

at a rate 57% higher than average for the County. The Assessor appealed, claiming the Tax

Commission failed to prove the discrimination was intentional. The Missouri Supreme Court

rejected the challenge, saying:

“Contrary to Appellant’s argument, … we have held that an assessor’s failure to act may have the effect of an intentional violation of the essential principle of practical uniformity. … Recognizing the import of the ‘in effect’ language … the nature of the constitutionally required evidence [is] as follows: A mere overvaluation of a specific property does not establish a discrimination in the absence of a showing of an intentional plan of discrimination or …, that other property generally is undervalued … . It is sometimes stated that the assessment of [the taxpayer’s] property must, in the absence of an intentional plan or design of discrimination, be so grossly excessive ‘as to be entirely inconsistent with an honest exercise of judgment.’ … By requiring that the level of an assessment be so grossly excessive as to be inconsistent with an honest exercise of judgment in cases in which intentional discrimination is not shown, the courts and the Commission refrain from correcting assessments which reflect no more than de minimus errors of judgment on the part of assessors. … Here, based on the whole record, and on competent and substantial evidence, the Commission found that the average assessment level for Greene County for the 1980 tax year was 20.9 percent and 20.5 percent for tax year 1981. Respondents’ properties were assessed at 33 ⅓ percent in those years. Such a disparity is so grossly excessive as to be entirely inconsistent with an honest exercise of judgment and has the effect of intentional discrimination.” (Citations omitted, emphasis in original.) Savage, at 78-79.

Analysis of county-wide 2019 Assessment data revealed staggering variations and

inaccuracies in valuations, particularly when comparing property within the Subject Area to

property in the rest of the county. First, the Assessor only applied the 14.9% valuation cap to 1.33%

of properties within the Subject Area that were tagged to increase by 15% or more, while applying

the 14.9% valuation cap to 54.5% of properties designated to increase by 15% or more elsewhere

in the County: a forty-fold disparity. Second, the assessed values in the Subject Area severely fail

industry standard indicators of uniformity; the coefficient of dispersion–the measure of

uniformity–is 49% in the Subject Area but only 14% in the rest of the County: a 250% disparity.

Third, there is severe market value regressivity (over-valuation of lower value properties) in the

Subject Area; the coefficient of price-related bias in the Subject area is -0.252 but only 0.002 in

the rest of the County: a 176-fold disparity. Fourth, the Assessor’s office over-valued residential

properties in the Subject Area 43% more often than in the rest of the County.

Examining the totality of the evidence, property within the Subject Area was clearly treated

differently, and more unequally, than property in the rest of the County. The property valuations

in the Subject Area are grossly inaccurate, more frequently over-assessed, especially for lower-

value properties, and received valuation caps at a significantly lower rate. The Assessor has

defended the unequal treatment by claiming that property in the Subject Area was historically

undervalued. But even if true, past undervaluation does not excuse discriminatory assessment

methodology. See Koplar v. State Tax Commission, 321 S.W.2d 686, 695 (Mo. 1959) (finding

assessor discriminated by assessing properties he thought previously undervalued at rate higher

than other properties in the same class). The property valuations in the Subject Area are so arbitrary

and inconsistent with market sales data that they cannot be explained as mere mistakes in an honest

exercise of judgment, and the quantum of Subject Area disparities cited above are so extreme–

much more so than in the Savage case-that they rise to the level of discrimination. Allowing such

discriminatory assessments to stand would be a manifest injustice to taxpayers in Jackson County.

b. The Assessor’s Office intentionally, systematically undervalued a significant number of properties in the 2019 Assessment, thereby discriminating against owners of other properties within the same class

The second theory for finding discriminatory assessments states: “The intentional act of an

assessor in assessing certain types of property at a higher rate than other property within the same

class violates the constitutional requirement of uniformity2.” Savage, at 78 citing Koplar, at 695.

“The law clearly and expressly requires that for the purpose of valuation all property in the state,

regardless of where situate, shall be dealt with in the same manner. For this purpose of valuation,

the law decrees uniformity.” Foster Bros. Mfg. Co. v. State Tax Commission of Mo., 319 S.W.2d

590, 595 (Mo. 1958) citing Mercantile Trust Co. v. Schramm, 190 S.W. 886, 887. In Boonville

Nat. Bank v. Schlotzhauer, the Missouri Supreme Court explained:

The purpose of the equal protection clause of the Fourteenth Amendment is to secure every person within the state’s jurisdiction against intentional and arbitrary discrimination, whether occasioned by express terms of a statute or by its improper execution through duly constituted agents. And it must be regarded as settled that intentional systematic undervaluation by state officials of other taxable property in the same class contravenes the constitutional right of one taxed upon the full value of his property. Boonville Nat. Bank v. Schlotzhauer, 317 Mo. 1298, 298 S.W. 732, 738, 55 A.L.R. 489 (Mo. 1927) quoting Sunday Lake Iron Co. v. Wakefield, 247 U. S. 350, 352. Intentional discrimination among property owners, for whom an equitable remedy is

appropriate and a showing of a lack of an adequate remedy at law is not required, is distinct from

unintentional inequalities created due to mistake, to the fallibility of human judgment, or to other

accidental causes that are necessarily inherent in any tax assessment process. Boonville, at 735. In

the latter instance of sporadic, erroneous judgment, “the taxpayer should follow the statutes and

appeal, and … there is no remedy in equity.” Id.

In Koplar, the assessor testified that he intentionally assessed a group of properties at a

higher rate than the rest of the properties in Jackson County. The Missouri Supreme Court found

that this evidence alone “was sufficient to show an intentional discrimination resulting from a

2 In Armstrong-Trotwood, LLC v. State Tax Commission of Missouri, 516 S.W.3d 830, 837 (Mo. Banc, 2017), the Missouri Supreme Court clarified that the uniformity requirement in Savage and Koplar is not based upon the uniformity clause of the Missouri constitution, which applies to tax rates. Rather, it refers to uniformity in the process of establishing the basis (valuation) of a property for the purposes of taxation in accordance with Article X, Sec. 4. of the Missouri Constitution and protected by the Fourteenth Amendment to the US Constitution.

purpose and design to discriminate by a systematic method” and “did not result from mere error

in judgment which in turn resulted in inequality in valuation.” Koplar, at 694, 695.

The Assessor in the present case has provided testimony regarding the 2019 Assessment

that is nearly identical to the assessor’s testimony in Koplar. While the Assessor’s Office claims

to have assessed all properties in the county at their true value in money, the Assessor has testified

that she applied a flat 14.9% increase to 2018 assessed values for over 74,000 homes, representing

approximately 28% of all county homes, that she states should have increased by a larger amount.3

The fact that over one-fourth of the properties in the county received this treatment indicates that

it was not a sporadic, accidental error in judgment, but rather a systematic, intentional

undervaluation.

While the individual taxpayers who were denied the benefit of a 14.9% cap were grossly

disproportionately located in the Subject Area, as described in the preceding section above, all

County taxpayers denied the 14.9% cap, whether eligible or not, are harmed in that the policy

violates their rights to a uniform assessment, and thereby shifts the tax burden disproportionately

to them.

The Assessor has defended this unequal treatment of properties by claiming the Assessor’s

Office “didn’t have enough time.” Claims of insufficient time to complete an assessment cannot

justify discrimination, and such a claim by the Assessor further supports that assessments on the

whole were arbitrary and unreasonable. See, Drey v. State Tax Commission, 345 S.W.2d 228, 234-

235 (finding assessor’s statement that he “didn’t have time” to perform physical inspection of

property was not a persuasive defense for discriminatory assessment). The Assessor’s Office

3 The arbitrary nature of the 14.9% valuation increases is strongly implied when considering §137.115.10 RSMo, which requires the assessor to conduct a physical inspection of any property before increasing the valuation by 15% or more, a process the Assessor evidently sought to avoid.

intentionally discriminated against large segments of residential property owners by implementing

a systematic undervaluing of other residential properties and the law requires that property owners

so discriminated against are entitled to have their property valuations reduced to the level of the

intentionally undervalued properties.

II. The Board has a statutory duty to equalize property values and thereby correct discrimination in the 2019 Assessment

When the Board has been presented with competent and substantial evidence of

discrimination, as occurred here, that evidence cannot be ignored. Koplar, at 695. “The

presumption in favor of the good faith of the taxing officials and of the correctness of the

assessments ceased to exist when the evidence of unlawful discrimination appeared.” (emphasis

added) Koplar, at 693. When property values are inaccurate, the “County Board is not only

authorized but required” to correct those valuations. May Department Stores v. State Tax

Commission, 308 S.W.2d 748, 760 (Mo. 1958); §138.050, RSMo; see also State ex rel. Taylor v.

Wade, 231 S.W.2d 179, 182 (Mo. 1950) (holding that when the General Assembly imposes an

official duty in the interest of the public upon a public officer, he has no discretion as to whether

or not it should be performed). In the present case, the Board was made aware of the Assessor’s

discriminatory conduct on at least six occasions through written submissions and oral testimony

that illustrated the previously discussed statistical analysis and evidence of the 14.9% valuation

increase cap. At that time, the Board, having received competent and substantial evidence of

discrimination, could not turn a blind eye to the unlawful assessments, and had a duty to correct

them. The Board, however, has failed to carry out that duty.

This mandate applies to both individual property valuations and to the assessment process

as a whole. When a body acting as an essential part of the taxing system intentionally, and therefore

fraudulently, violates the law by uniformly undervaluing certain kinds of properties, and other

properties are assessed in compliance with state statute at their true value, the entire assessment as

a whole, considered as one judgment, is a fraud upon the fully-assessed properties. Boonville, at

735. These fraud victims are entitled to have their assessments reduced to the level of the

intentionally undervalued properties, for “where it is impossible to secure both the standard of the

true value, and the uniformity and equality required by law, the latter requirement is to be preferred

as the just and ultimate purpose of the law.” Boonville, at 739. To the extent that this holding in

Boonville was based upon the practicability of raising a large number of property valuations to

their true value in money in comparison to reducing a small number of property valuations to be

uniform with other under-valued property, the holding would still be applicable in the present case

where applying the 14.9% cap to all properties not currently receiving the cap would be much

simpler than finding the true market value of the properties that did receive the cap, particularly in

light of the previously discussed analysis demonstrating the inaccurate valuations resulting from

the methods employed by the Assessor to conduct the 2019 Assessment.

Correcting the Assessor’s confessed discrimination clearly falls within the Board’s

statutory duties as explained by Missouri courts. Additionally, the fact that the Board is the only

body capable of correcting this discrimination on a county-wide basis further evidences its duty to

do so. The State Tax Commission is restricted to equalizing class valuations between counties and

hearing direct appeals from county boards of equalization. Const.Mo. Art. X, Sec. 14. And courts,

lacking the authority to determine Market Value of individual properties for assessment purposes,

are limited to finding illegal assessments void. Koplar, at 697.

By abdicating its duty, the Board is effectuating its own discrimination against property

owners in Jackson County. A “failure to act may have the effect of an intentional violation of the

essential principle of practical uniformity.” Savage, at 78. “If the persons charged with making

this assessment refused to assess [the taxpayer's] property in proportion to its value and in

uniformity with all other taxable property ..., they are presumed to have known that such

assessment would be in violation of sections 4 and 3 respectively, of article 10 of the Constitution

of Missouri, and would result in unlawful discrimination....” Savage, at 78 quoting Jefferson City

Bridge & Transit Co. v. Blaser, 318 Mo 373, 300 S.W. 778, 785 (1927). Furthermore, when an

assessor has discriminated in making property assessments, “the action of the assessor was a fraud

entering into the very concoction of the assessment judgment, and such fraud follows the judgment

and is a part thereof through both the county and state boards of equalization.” Boonville, at 741.

In other words, the fraud promulgated by the Assessor’s Office in the 2019 Assessment follows

property valuations into decisions, or indecisions, made by the Board. By failing to correct the

discrimination despite substantial and competent evidence thereof, the Board is presumed to know

that its own inaction regarding equalizing property valuations across the county would amount to

a discriminatory illegal exercise of its discretion. In this way, the Board is conducting its own fraud

against those taxpayer’s whose properties were assessed at their full value or more by allowing

those valuations to stand despite the Board’s knowledge that other properties were systematically

undervalued.

As the Missouri Supreme Court explained, “assessments are in the nature of at least, quasi-

judicial judgments” and, like judgments, cannot be impeached collaterally; however, “[w]e should

likewise destroy them for fraud if shown.” Boonville at 736.

III. The Board has abused its discretion and acted unlawfully by failing to correct the discrimination in the 2019 Assessment, and mandamus is appropriate to correct this manifest injustice

The Board has a statutory duty to equalize property values, meaning to ensure that there is

uniformity in how property valuations are established for the purposes of taxation. May Dept.

Stores, at 760. The Board cannot blindly ignore evidence of discrimination when performing this

duty and has the affirmative duty to correct such discrimination when made apparent. Koplar, at

695. By failing to uphold its duty, the Board has effectuated its own discrimination against

taxpayers in Jackson County. Boonville, at 741. The Board has acted unlawfully through its failure

to correct the discrimination inherent in the 2019 assessment by failing to equalize property values,

thereby perpetuating that discrimination. Further, through its discrimination for failure to equalize

property values, the Board has acted wrong as a matter of law, and therefore abused its discretion.

Keystone Laundry, at 19. Because the Board has either failed to uphold its duty to exercise its

discretion or has done so in an illegal manner, mandamus is appropriate to compel the Board to

satisfy its statutory duty to equalize property values and thereby prevent unlawful discrimination.

Keystone, at 14; State Ex. Rel. Byrd, at 376.

Relators are entitled to this relief without the necessity of exhausting any administrative

remedies in part because administrative remedies are not adequate for Relators. When taxpayers

suffer discrimination in the valuation of their properties, the taxpayers have “selected the right

remedy and the right forum when [they go] to a court of equity for relief”, and “equity may properly

interfere to restrain the operation of this unconstitutional exercise of power”. Boonville, at 738.

The court in Boonville found that “certiorari to the state board of equalization or to the county

board of equalization would be wholly inadequate” as a remedy for property owners who were the

victims of unlawful discrimination by the assessor in property valuations. Boonville, at 735.

Even if administrative remedies are available to Relators, mandamus is still the appropriate

remedy, whether or not administrative remedies have been exhausted, if an administrative body

has acted unlawfully or exceeded its jurisdiction. Missouri Bluffs Golf Joint Venture v. St. Charles

County Board of Equalization, 943 S.W.2d 752, 756 (Mo.App.1997), citing State Bd. of Hlth. Ctr.

v. County Com'n., 896 S.W.2d 627, 631 (Mo. Banc 1995). As previously illustrated, the Board has

acted unlawfully by failing to correct the discrimination present in the very concoction of the 2019

Assessment, thereby itself discriminating against taxpayers. As a result, Relators need not exhaust

any potential administrative remedies should the court find them available.

Finally, there exists “[a]nother narrow exception to the exhaustion rule in which the remedy

of mandamus is considered more convenient, beneficial, or effective than further administrative

review. That exception has been applied to cases in which prompt review of a ruling is not available

because there would be no final judgment disposing of all issues and parties for a substantial time

period.” State ex rel. DPH Chesterfield, LLC v. State Tax Comm. of MO, 398 S.W.3d 529

(Mo.App.E.D., 2013) citing State ex rel. Sasnett v. Moorhouse, 267 S.W.3d 717, 724-25

(Mo.App.W.D., 2008). In Keystone, in addition to considering the adequacy of alternative

remedies, the court’s decision to issue a writ of mandamus, at least in part, was also “influenced

by the public importance of the matter.” Keystone, at 15. Equal treatment among property owners

for the purposes of taxation is clearly a matter of high public importance as it is a right vested in

every taxpayer in the county. The only other remedy is for every individual taxpayer receiving a

discriminatory assessment to follow the statutory guidelines for property appeals, which is not

available to taxpayers harmed by the Assessor’s fraudulent intentional undervaluation of certain

other properties because “individual taxpayers lack standing to challenge other taxpayers’ property

assessments.” State ex rel. Kansas City Power & Light Co. v. Macbeth, 322 S.W.3d 525, 529 (Mo.

Banc 2010). Moreover, placing the onus on individual taxpayers to appeal such widespread

valuation errors shifts the Assessor’s duty to uniformly and correctly assess property imposed by

the Legislature in RSMo §137.115 from the Assessor to County residents.

If administrative review were available, the appellate process would result in inconsistent

results between those properties intentionally undervalued and those forced to appeal, and the

resolution of all appeals cases will not be done in a speedy manner. The assessor has recently

testified that her office had not finished with informal appeals as of December 6, 2019, and the

Jackson County Executive’s office announced on December 23, 2019 that it had discovered 8,600

unread emails to the Board which likely contain even more appeals. Board appeal hearings will

last well into 2020 at this point, which doesn’t even account for the additional time needed to file

an appeal to the State Tax Commission after a Board hearing. Moreover, the Board has admitted

that there have been serious issues providing taxpayers with proper notice of their scheduled

hearings which calls into question the legitimacy of the entire appeal process for the 2019

Assessment. With tax payments due on December 31, it is clear that an equalization order is the

only proper avenue for the Board to equalize property values in a summary way as required by

§138.060, RSMo.

While the entry of an equalization order may raise concerns regarding a potential revenue

shortfall for entities that rely on property taxes to cover operating expenses, such a situation has

been contemplated by the Legislature and a remedy is provided in §137.073.3.(2), RSMo. The

ability to temporarily withstand a funding shortfall and thereafter recoup said shortfall is a luxury

available to the County that is not available to many taxpayers suffering the effects of

discriminatory assessments, which further supports that the County should bear the brunt of the

2019 Assessment rather than the taxpayers.

IV. The Board must enter an intra-county equalization order to fulfill its duty to equalize property values and thereby correct the discrimination in the 2019 Assessment

Whenever the duties of a public officer are such that he or she may exercise discretion in

their performance, mandamus may be employed to put such officer in motion; but it cannot be

employed to dictate the manner in which such discretion is to be exercised. State ex rel. Wear v.

Francis, 8 S.W. 1, 6 (Mo. 1888). This is the exact remedy that Relators seek in the present action.

The Board has failed to equalize property valuations across Jackson County despite ample

evidence of wide-spread discrimination in the 2019 Assessment, and Relators seek an order

compelling the Board to fulfill its duty to end the discrimination.

The Missouri Supreme Court has affirmed that a county board of equalization has the full

power and duty to issue such orders, raising and lowering valuations to effect intra-county

equalization. See May Dept. Stores, at 759. In that case, when discussing how the board of

equalization perform its duty, the court noted:

“In the case of Black v. McGonigle, 103 Mo. 192, 15 S.W. 615, it was held that the action of a county board of equalization increasing valuations in all townships except one, on differing percentages, was valid; also, that the board might have increased the valuations of individual tracts, had it chosen to do so. In part, the court said (103 Mo. loc. cit. 198, 199, 760 15 S.W. loc. cit. 617): ‘Where the lands in one township have been assessed at their true value, and those in another township have been assessed at a uniform lower rate, then the assessed value of the lands in the latter may be brought up to the standard of the former, and that is what appears to have been done in the present case. In such a case it is not necessary to specify each parcel of land thus increased. It is sufficient to increase the assessed value of all the lands in the particular township by one order; and this increase may be made on a per centum basis. Says Cooley: ‘In raising or reducing the assessment of a particular district, it is sufficient for the board to designate a percentage of increase or decrease.’ Cooley, Taxation [2 Ed.] 422.” (Emphasis added.) Id., at 759-60. It is evident the Board has wide latitude in how it exercises its discretion in equalizing

property values, and Relators do not seek an order from this Court impinging the Board’s

discretion. Although courts cannot dictate the manner in which public officials exercise discretion,

courts can provide guidance to ensure that the discretionary act comports with the law. This is

because “[t]he determination of questions of law is reserved to the courts, and such matters may

not be decided by an administrative board.” Keystone, at 14. It is therefore appropriate for this

Court to include guidance for the Board in the mandamus order requested in this action to ensure

that the fraud in the concoction of the 2019 Assessment may be properly excised. See, e.g. Drey,

at 237-238 (instructing the State Tax Commission on factors to consider when fulfilling

discretionary duty of determining property valuation).

CONCLUSION

For the reasons stated above, the Court should grant a preliminary and a permanent writ

compelling the Jackson County, Missouri Board of Equalization, through its members, to exercise

its discretion to equalize property valuations so that no properties are victims of discrimination;

and for such other relief as the court deems just and proper.

DATED this 31st day of December, 2019.

Respectfully submitted,

/s/ Michael Duffy Michael Duffy, MO Bar #28511 Legal Aid of Western Missouri

920 Southwest Boulevard Kansas City, Missouri 64108 PHONE: (816) 474-9868 FAX: (816) 474-7575 mduffy@crn.org

Brandon C. Mason, MO Bar #69216 Legal Aid of Western Missouri

920 Southwest Boulevard Kansas City, Missouri 64108 PHONE: (816) 474-9868 FAX: (816) 474-7575 bmason@lawmo.org

/s/ Joshua Walburn Joshua Walburn, MO Bar #69413 Legal Aid of Western Missouri

920 Southwest Boulevard Kansas City, Missouri 64108 PHONE: (816) 474-9868 FAX: (816) 474-7575 jwalburn@lawmo.org

SUGGESTIONS IN SUPPORT: EXHIBIT INDEX

Exhibit 1: Subject Area Map………………………………………………………………...… 1

A map of the Subject Area, encompassing roughly the area bound by Independence Avenue on the north, Blue Ridge Cutoff on the east, 85th Street and the Grandview Triangle to the south, Troost Avenue to the west and includes the Westside Neighborhood, which is bounded by Broadway on the East, Beardsley Road/Allen Avenue/Southwest Blvd. on the West, 13th Street on the North, and 31st Street on the South

Exhibit 2: Racial Dot Map……………………………………………………………………... 2

A map illustrating racial makeup by census tract within Kansas City, including the Subject Area.

Exhibit 3: Subject Area Report……………………………………………………….……. 3 - 5

Mr. Josh Myers’s report detailing the results of his research into a three-page memorandum titled “Preliminary Conclusions with Regard to the Target Area in Jackson County, MO”, which indicates three significant deficiencies in the 2019 Assessment.

Exhibit 4: Request for Order…………………………………………………...…….….... 6 - 17

A copy of the Request for Order submitted to the Board detailing the discriminatory nature of the 2019 Assessment, the 2019 Assessment’s disparate impact upon minority and low-income populations, and the Board’s legal duty to correct the discriminatory effects of the 2019 Assessment.

Exhibit 5: Supplement…………………………………………………...…….…………... 18-36

A copy of the “Supplemental Testimony Following Special Hearing of the Board of Equalization” submitted to the Board the which reiterated to the Board that the 2019 assessment was discriminatory, and therefore unlawful, and that in the face of discrimination the Board has a duty to act.

Exhibit 1

Exhibit 2

Preliminary Conclusions with Regard to the Target Area in Jackson County, MO

Introduction

In September of 2019, Josh Myers Valuation Solutions was asked by the Hispanic Economic Development Corporation (HEDC) of Kansas City to do a statistical review of the 2019 Jackson County, MO Assessment with regard to an area of County deemed the target area. This target area of parcels is a geographic area in the western half of Jackson County that is comprised mostly of residents from a racial minority group. The rest of the County, deemed the non-target area, is comprised mostly of residents not from a racial minority group.

This preliminary summary report investigates two areas of interest:the appraisal performance of the 2019 Assessment performed by the Jackson County Assessor in the target and non-target areas.the application of the appraised value increase caps of 14.9% in the target area and the non-target areas.

This report performs each analysis in accordance with the IAAO Standard on Ratio Studies and focuses solely on residential single-family properties not including condominiums. All conclusions are statistically significant, and confidence intervals are given for each statistic. This report is intended as a summary, not a complete analysis, for the purpose of advising the Kansas City HEDC on the big-picture issues, if any, that exist.

The Appraisal Level in the Target Area is Lower than in the Non-Target Area

The IAAO standard for appraisal level is for the measure of central tendency of the sales ratios to be within 10% of 100% of fair market value (a range of 90% to 110%). This analysis focuses on the median sales ratio, which is the median value of the appraised value to sale price ratios. The median sales ratio in the non-target area is 87.4% and in the target area is 77.6% (see Table 1). Therefore, the Assessor does not meet the IAAO standard on appraisal level for both the target and non-target areas. The Assessor is not yet appraising all properties at full market value. Also, the level of appraisal is higher in the non-target area than in the target area by almost 10 percentage points. This means that, on average, properties in the target area are being appraised at a lower percentage of their market values than properties in the non-target area.

Table 1

Area Median Sales Ratio Industry Standard Overall Conclusions

Target Area 77.6%CI: (73.8%, 81.3%) 90% to 110% Does Not Meet Industry

Standards

Non-Target Area 87.4% CI: (87.1%, 87.8%) 90% to 110% Does Not Meet Industry

Standards

Exhibit 3

Appraisal Uniformity in the Target Area is Much Worse than in Non-Target Area

The Assessor has met appraisal standards of uniformity, if just barely, in the non-target area, but has badly missed appraisal standards of uniformity in the target area. The Coefficient of Dispersion (COD), an overall measure of appraisal uniformity, is 49.7% in the target area and 14.2% in the non-target area. This value of the COD in the non-target area falls in the IAAO standard range for this class of property (5% to 15%), but the value of the COD in the target area does not. Therefore, the appraised values in the target area are much more variable in relation to the market than industry standards permit. This is demonstrated in Table 2 below. This level of variability means that some properties in the target area are appraised at well below their fair market value and some properties in the target area are appraised at well above their fair market value.

There is also significant market-value regressivity present in the target area. The Coefficient of Price-Related Bias (PRB), a measure of market-value vertical inequity, is -0.252 in the target area and 0.002 in the non-target area. The value of the PRB in the non-target area falls in the IAAO standard range and is not even statistically significantly different than zero, indicating that there is no vertical inequity present there. The value of the PRB in the target area, however, falls below the IAAO standard range and indicates a significant level of market-value regressivity. This means that lower-valued homes in the target area are appraised at a much higher percentage of their fair market value than higher-valued homes in the target area.

Overall, the amount of appraisal inequity present in the target area is quite extreme, and at least of some of this inequity in due to appraisal regressivity. This will necessarily lead to much disparity in effective property tax rates in the target area.

The difference between the amount of uniformity present in the target and non-target area is striking. Practically, this means that properties in the target area are subject to this high degree of non-uniformity, whereas properties in the non-target area are not. These two areas of a County are being treated differently.

The high degree of non-uniformity in the target area offsets, in a sense, the fact that the target area has a lower appraisal level than the non-target area. While the overall level of appraisal is lower in the target area, the high degree of appraisal inequity present there means that a much higher percentage of properties in the target area (approximately 30.3%) will be over-appraised with respect to fair market value than properties in the non-target area (approximately 20.7%), a rate that is approximately 46.2% higher.

Table 2Area COD Industry Standard Overall Conclusions

Target Area 49.7%CI: (45.8%, 53.2%) 5% to 15%

High Degree of Non-Uniformity; Does Not Meet

Industry Standards

Non-Target Area 14.2% CI: (13.9%, 14.4%) 5% to 15% Meets Industry Standards, but

just barely.

Exhibit 3

Table 3

Appraised Value Caps are Applied at a Much Higher Rate in the Non-Target Area

The Assessor’s Office has produced appraised value caps at 14.9% for a number of properties that the Office determined should have an increase of at least 15%. However, this was not done equitably. The caps are being applied at a much higher rate in the the non-target area than in the target area (see Figure 1). In the non-target area, 54.5% of the properties that were marked for at least a 15% increase have a cap of 14.9%. However, in the target area, only 1.33% of the properties that were marked for at least a 15% increase have a cap of 14.9%. This is an inequitable application of the appraised value cap. A much higher percentage of properties in the non-target area than in the target area are enjoying a lower property value than the Assessor originally intended to have on those properties due to an inequitable application of the 14.9% appraised value cap. This will necessarily lead to a higher percentage of properties in the non-target area than in the target area having a lower effective tax rate than they otherwise would have had without the 14.9% appraised value cap in place.

Area PRB Industry Standard Overall Conclusions

Target Area -0.252CI: (-0.305, -0.199) -0.10 to 0.10 Highly Regressive; Does Not

Meet Industry Standards

Non-Target Area 0.002CI: (-0.002, 0.006) -0.10 to 0.10 Meets Industry Standards

Figure 1

Exhibit 3

Exhibit 4

REQUEST FOR ORDER

From: Ivanhoe Neighborhood Council, Westside Neighborhood Association, Washington Wheatley Neighborhood Improvement Association, and Independence Plaza Neighborhood Council

To: Jackson County Board of Equalization Attn: Christopher Smith, Chairman

Re: Request for an ORDER OF INTRA-COUNTY EQUALIZATION OF VALUE FOR CERTAIN RESIDENTIAL REAL PROPERTY IN JACKSON COUNTY, MISSOURI

Date: November 1, 2019

This Request for Order (the “Request”) is intended to serve as a request upon the

Jackson County, Missouri Board of Equalization to issue an intra-county order of equalization,

equalizing the value of certain residential real property taxable by the county within both the

Kansas City School district and Kansas City, Missouri , so that such property shall be entered on

the tax book at their true value.

Subject Property

This Request, and the proposed order attached hereto as Exhibit B, shall apply only to

those parcels of residential real property whose value is at or below the median property

valuation (the “Subject Properties”) within the boundaries detailed in purple in the attached

Exhibit A (the “Subject Area”), all of which are within the Kansas City 33 School District

(School District of Kansas City, Missouri), Jackson County, Missouri, and the municipality of

Kansas City, Missouri.

Grounds for Request

Review is sought due to the overwhelming number of incorrect valuations submitted by

the office of the assessor of Jackson county, as evidenced by: (1) the record number of appeals

filed before the Board of Equalization; (2) evidence of flawed valuations in individual appeals,

Exhibit 4

evidencing a failure to identify true market conditions within the Subject Area, and instead

relying on flawed comparable sales data, with an emphasis on speculator pricing; (3) the unique

character of the residential real property parcels within the Subject Area due to their density,

sized, location, age and historical nature; (4) the admittedly disparate treatment received by the

Office of the Assessor during their statutorily required bi-yearly evaluation, as evidenced by

large segments of parcels outside of the Subject Area receiving a flat-rate 14.9% increase due to

the assessor’s office “running out of time”; and substantial over-valuation by the Assessor of

lower-value residential properties in the Subject Area.

More specifically, the coefficient of dispersion, an overall measure of appraisal

uniformity, is approximately 49% in the Subject Area, and approximately 14% in the rest of the

County. This value of the coefficient of dispersion for the rest of the County falls (barely) in the

IAAO standard range for this class of property (5% to 15%), but the value of the coefficient in

the Subject Area does not. Hence, the appraised values in the Subject Area are much more

variable in relation to the market than industry standards permit. This level of variability in the

Subject Area means that some properties in the Subject Area are appraised well below their fair

market value and some properties in the Subject Area are appraised at well above their fair

market value.

In addition, there is also significant market value regressivity in the Subject Area. The

coefficient of price-related bias, a measure of market value vertical inequity, is approximately

-0.252 in the Subject Area, and 0.002 in the rest of the County. The value in the rest of the

County falls in the IAAO standard range (-0.10 to 0.10), indicating little to no vertical inequity

there. The value in the Subject Area, however, falls below the IAAO standard range and

indicates a significant level of market value regressivity. This means that lower valued homes in

Exhibit 4

the Subject Area are appraised at a much higher percentage of their fair market value than higher

valued homes in the Subject Area.

The high degree of appraisal inequity present in the Subject Area means that a much

higher percentage of residential properties in the Subject Area (approximately 30%), the great

majority of which are lower value properties, will be over-appraised with respect to fair market

value than properties in the rest of the County (approximately 21%), a rate that is approximately

43% higher.

The Subject Area has higher concentrations of African-American and Hispanic residents

than elsewhere in the County.

The Jackson County Board of Equalization is respectfully requested to enter an Order of

Intra-County Equalization of Value for Residential Real Property in Jackson County, Missouri

affecting the lower value Subject Properties within the Subject Area, in the form of a proposed

order attached to this Request as Exhibit B.

Michael Duffy Brandon Mason Joshua Walburn Attorneys for Requestors Legal Aid of Western Missouri 920 Southwest Blvd. Kansas City, Missouri. 64108 816-474-9868 bmason@lawmo.org

Exhibit 4

The area of the new target area is:North—Independence Avenue. East—KCPS boundary. South—Meyer Blvd to 63rd stWest—Troost.

The Westneighborhood is bordered on the south by 31st st, east by Summit and the west by the county boundary.

Exhibit A

Exhibit 4

EXHIBIT B

JACKSON COUNTY, MISSOURI BOARD OF EQUALIZATION

ORDER OF INTRA-COUNTY EQUALIZATION OF VALUE FOR

CERTAIN RESIDENTIAL REAL PROPERTY IN JACKSON COUNTY, MISSOURI

This Order of Intra-County Equalization of Value for Residential Property in Jackson

County, Missouri is made following the assessment of the Office of the Assessor of Jackson

County, Missouri for the tax year 2019. We, the Board of Equalization of Jackson County,

Missouri, after review and consideration of the relevant facts, law, and authority granted to this

body, hereby enter this order, pursuant to the powers of this Board, equalizing the valuation and

assessments of all residential real property described below so that all the aforementioned

property shall be entered on the tax books at its true value. §138.030, RSMo.

This Order shall apply only to those parcels of residential real property whose value is at

or below the median residential property valuation (the “Subject Properties”) within the

boundaries detailed in the attached Exhibit A (the “Subject Area”), all of which is within both

the Kansas City 33 School District, Jackson County, Missouri, and the City of Kansas City,

Missouri.

NOW, THEREFORE, IN CONSIDERATION OF THE FOREGOING, BE IT

ORDERED BY THIS JACKSON COUNTY BOARD OF EQUALIZATION:

(1) That the valuation and assessments of the Subject Properties within the Subject Area

offered by the Office of the Assessor of Jackson County, Missouri are hereby vacated;

Exhibit 4

(2) That the valuations and assessments of the Subject Properties within the Subject Area are

hereby equalized, and shall be determined in accordance with the following:

a. For each individual parcel:

i. By subtracting the Total Market Value of a particular parcel assigned by

the Office of the Assessor for the tax year of 2018 (“TMV-2018”) from

the Total Market Value assigned by the Office of the Assessor for the tax

year of 2019 (“TMV-2019”) and, if the resultant number is positive, and

greater than 6% of TMV-2018; then

ii. By multiplying the TMV-2018 by 1.06; and

iii. The remaining TMV-2019 valuations shall remain unchanged except as

otherwise modified by the Board of Equalization;

b. Except, however, that improved residential properties newly constructed since the

2018 assessment shall be exempted from this order.

IT IS SO ORDERED THIS DAY OF NOVEMBER, 2019 Christopher R. Smith, Chairman Marilyn M. Shapiro, Vice-Chair

Forestine A. Beasley, Member

Howard Townsend, Representative

James Glover III, Representative

Exhibit 4

The area of the new target area is:North—Independence Avenue. East—KCPS boundary. South—Meyer Blvd to 63rd stWest—Troost.

The Westneighborhood is bordered on the south by 31st st, east by Summit and the west by the county boundary.

Exhibit A

Exhibit 4

EXECUTIVE SUMMARY

The 2019 Assessment Was Discriminatory:

The 2019 assessment was quantifiably discriminatory, as evidenced by statistical

analysis, arbitrary valuation caps, and the Board’s own experience. Discrimination in the 2019

assessment takes two forms: (1) Methodological discrimination by the assessor’s office because

the assessor intentionally undervalued properties through the use of flat 14.9% increases to some

properties while assessing other properties differently, and (2) racial discrimination, because the

2019 assessment results in a disproportionate tax burden on taxpayers residing in the county’s

predominantly minority neighborhoods. Discrimination in an assessment is unlawful. This

assessment is doubly so.

The Board Has a Mandatory Duty to Correct Discrimination:

The cases cited here and in our previous memoranda state plainly that the Board has a

mandatory duty to correct the discrimination inherent in this assessment. This is settled law. Our

situation is nearly identical to the facts of Koplar, where the court held that intentionally

undervaluing properties evidenced discrimination and imposed a mandatory duty to correct the

discriminatory assessments. You are the sole body capable of such correction through your

unique tool of an intra-county order of equalization. The entry of such an order would fulfill your

lawful duty to the citizens of Jackson County.

The Board is Complicit in that Discrimination If It Does Not Act:

The Missouri Supreme Court has held that the assessor, board of equalization, and state

tax commission are but individual pieces of one assessment process. Together, they are charged

with delivering a proper assessment, and likewise are presumed to be culpable where

discrimination exists within assessments. “[T]he action of the assessor was a fraud entering into

Exhibit 5

the very concoction of the assessment judgment, and such fraud follows the judgment and is a

part thereof through both the county and state boards of equalization.” Boonville v. Schlotzhauer,

317 Mo. 1298 (1927).

Thus, by failing or refusing to perform your duty under the law to equalize values

through the entry of an intra-county order of equalization, the Board is effectuating its own

discrimination against property owners in Jackson County. A “failure to act [by the Board] may

have the effect of an intentional violation of the essential principle of practical uniformity.”

Savage at 78. Your failure or refusal to act is tantamount to affirming and perpetuating this

discriminatory assessment. The only way to avoid this is to enter an equalization order.

Exhibit 5

SUPPLEMENTAL TESTIMONY FOLLOWING SPECIAL HEARING OF THE BOARD OF EQUALIZATION

To: The Jackson County Board of Equalization From: Michael Duffy, Joshua Walburn, Brandon Mason Legal Aid of Western Missouri Date: December 10, 2019 Re: Board of Equalization’s Issuance of an Intra-County Equalization Order Chairman Smith, Vice-Chair Shapiro, and Member Beasley,

This letter follows the November 21, 2019 Special Hearing of the Board of Equalization

(the “Board”), where the Board asked Legal Aid’s opinion on matters including the Board’s

authority to enter intra-county orders of equalization, the unlawful discrimination inherent in the

2019 assessment, the Board’s duty to correct that assessment through the entry of an order, and

the practicability of implementing such an order. We are writing you as a supplement to our

answers to those questions and to address remaining hesitations the Board may hold. This

Supplement has been divided in to two sections: First that the 2019 assessment was

discriminatory, and therefore unlawful, and second that in the face of discrimination the Board

has a duty to act.

This entire saga can be summarized into four conclusions: (1) the 2019 assessment was a

discriminatory assessment, (2) discrimination in an assessment is unlawful, (3) it is the Board’s

duty to correct this unlawful assessment; and (4) if the Board does not correct the discrimination

in the assessment, that the Board is effecting its own discrimination upon taxpayers.

Discrimination

Discriminatory assessments occur when properties are assessed using different methods

or when assessed valuations of similar properties vary significantly. The Board has seen

evidence of discrimination in (1) the statistical analysis performed by Josh Myers and submitted

Exhibit 5

by Legal Aid of Western Missouri1 – showcasing the assessor’s failure of appraisal uniformity,

vertical inequity, regressive taxation, and arbitrary application of valuation caps, all of which

disproportionately target and affect low-income, minority county residents; (2) the assessor’s

statement that she “ran out of time” to fully and fairly assess properties and therefore

intentionally undervalued property by capping increases of certain properties at a flat 14.9% –

essentially undervaluing properties in non-minority areas, while mostly depriving minority areas

of the benefit of that cap; and (3) the Board’s own experience from conducting appellate

hearings.

Discrimination in the 2019 assessment takes two forms: (1) Methodological

discrimination by the assessor’s office because the assessor intentionally undervalued properties

through the use of flat rate increases to some properties while assessing other properties

differently, and (2) racial discrimination, because the 2019 assessment results in a

disproportionate tax burden on taxpayers residing in the county’s predominantly minority

neighborhoods.

In Jackson County, the discrimination inherent in the assessment is quantifiable.

Specifically, Mr. Myers’s report highlights significant discriminatory deficiencies associated

with the 2019 Assessment:

a. That the Assessor’s Office applied a blanket appraisal value caps much more

frequently outside of the Subject Area than within (Specifically, in the non-target, mostly

1 A copy of Josh Myers’s “Preliminary Conclusions with Regard to the Target Area in Jackson County, Mo” is attached as Exhibit A. Also included with this e-mail are the recommendations of Mr. Josh Myers’s, the statistician who performed the data analysis underpinning Legal Aid’s proposed intra county order. A copy of Mr. Myers’s recommendations is attached as Exhibit B. Josh Myers graduated with a B.S. in physics and mathematics from the University of Virginia and a Masters in statistics from the University of Virginia. Mr. Myers is also a member of the IPTI/IAAO Editorial Review Board, was a past member of the IAAO Technical Standards Committee, a past member of the IAAO AVM Global Credentialing Task Force, and a current member of the IAAO Task Force on the Standard on the Verification and Adjustment of Sales.

Exhibit 5

white area, 54.5% of the properties that increased by 14.9% or more were capped at

14.9%. However, in the mostly African American and Hispanic target area, of those

properties that increased by 14.9% or greater, only 1.33% received an increase cap of

14.9%. See Subject Area Report, pg. 3);2

b. That the Assessor’s Office badly failed to meet appraisal standards of uniformity

in the Subject Area, in that the coefficient of dispersion, an overall measure of appraisal

uniformity, is approximately 49% in the Subject Area, and approximately 14% in the rest

of the County;3

c. That there is significant market value regressivity in the Subject Area but virtually

no regressivity in the rest of the County; this means that lower valued homes in the

Subject Area are appraised at a much higher percentage of their fair market value than

higher valued homes in the Subject Area;4

d. That the Assessor’s Office over-appraised residential properties in the Subject

Area 43% more often than in the rest of the county;

e. That the findings evidenced in the Subject Area Report indicate that the

discrimination inherent in the 2019 Assessment results in a disproportionate tax burden

2 Missouri courts have held that arbitrary valuation caps such as those employed here by the Assessor’s Office are de facto discrimination. See TJ Moss Tie Co., v. Allen, 8 S.W.2d 1038 (Mo. Ct. App. 1928). 3 This value of the coefficient of dispersion for the rest of the County falls just within the IAAO standard range for this class of property (5% to 15%), but the value of the coefficient in the Subject Area far exceeds the standard range. Hence, the appraised values in the Subject Area are much more variable in relation to the market than industry standards permit. This level of variability in the Subject Area means that some properties in the Subject Area are appraised well below their fair market value and some properties in the Subject Area are appraised at well above their fair market value. 4 The coefficient of price-related bias, a measure of market value vertical inequity, i.e. regressivity, is approximately -0.252 in the Subject Area and 0.002 in the rest of the County. The value in the rest of the County falls in the IAAO standard range (-0.10 to 0.10), indicating little to no vertical inequity there. The value in the Subject Area, however, falls below the IAAO standard range and indicates a significant level of market value regressivity. This failure to uniformly appraise properties by the Assessor’s Office, however, is not present outside of the Subject Area, meaning that the Subject Area was treated differently by the Assessor’s Office than the rest of the County. See Josh Myers’s Report, pg. 2.

Exhibit 5

on Jackson County’s poorest citizens residing in the county’s predominantly minority

neighborhoods.

We invite each of you to review thoroughly Mr. Myers’s attached findings and

recommendations. They highlight an assessment that has failed to meet national appraisal

standards and which has grossly and disproportionately affected minority and low-income

communities. This was discrimination with a capital D. This is unlawful.

The Supreme Court of Missouri has stated that “[a] County Board of Equalization has the

full power and duty to effect intra-county equalization.” May Dept. Stores Company v. State Tax

Commission, et al., 308 S.W. 2d 748, at 759 (Mo. 1958) (emphasis added). When the Board has

been presented with competent and substantial evidence of discrimination, that evidence cannot

be ignored. Koplar v. State Tax Commission.5 When property values are inaccurate, the “County

Board is not only authorized but required” to correct those valuations. May Department Stores,

§138.050, RSMo; see also State ex rel. Taylor v. Wade, 231 S.W.2d 179, 182 (Mo 1950)

(Holding that when the General Assembly imposes an official duty in the interest of the public

upon a public officer, he has no discretion as to whether or not it should be performed). When

confronted with a discriminatory assessment, the Supreme Court explained in Koplar:

“The presumption in favor of the good faith of the taxing officials and of the

correctness of the assessments ceased to exist when the evidence of unlawful

discrimination appeared…The testimony of the assessor, who made the questioned

assessments, if believed, was sufficient to show an intentional discrimination

resulting from a purpose and design to discriminate by a systematic method of

5 321 S.W.2d 686, 695 (Mo. 1959).

Exhibit 5

assessing these properties at a greater percentage of true value than the assessment of

other real estate in Jackson County and his testimony shows that the questioned

assessments did not result from mere error in judgment which in turn resulted in

inequality in valuation…The Commission could not arbitrarily disregard and ignore

the competent, substantial and undisputed testimony of the assessor...”

Our situation is nearly identical to the facts of Koplar, where the assessor intentionally

undervalued properties through the use of flat rate increase to some properties while assessing

other properties differently. See Exhibit A. Upon this showing, the court held that the evidence of

discrimination created a duty in the reviewing body to correct the discriminatory assessments.6

These cases state plainly that the Board has a mandatory duty to correct the discrimination

inherent in this assessment.

This mandate applies to both individual property valuations and the assessment process

as a whole. When a body acting as an essential part of the taxing system intentionally, and

therefore fraudulently, violates the law by uniformly undervaluing certain kinds of properties,

and other properties are assessed in compliance with state statute at full value, the entire

assessment as a whole, considered as one judgment, is a fraud upon the fully-assessed properties.

Boonville v. Schlotzhauer, 317 Mo. 1298 (1927). “[W]here it is impossible to secure both the

standard of the true value, and the uniformity and equality required by law, the latter requirement

is to be preferred as the just and ultimate purpose of the law.” Boonville, at 1319. Correcting the

Assessor’s confessed discrimination clearly falls within the Board’s statutory duties as explained

by Missouri courts. Additionally, the fact that the Board is the only body capable of correcting

6 See also State ex rel Stone v. Christian County Bank, 234 Mo. 194 (Mo. 1911) (holding that if it is the opinion of the Board of Equalization that lands have been assessed in an inequitable manner, it is their duty to correct the assessment valuations).

Exhibit 5

this discrimination on a county-wide basis further evidences its duty to do so: the State Tax

Commission may equalize between counties, which would be unhelpful in our case because the

discrimination is inherent in the Jackson County assessment alone. Further, courts may only

render assessments void for discrimination, which would likely involve rolling back valuations

to a previous year and ordering a new assessment be conducted, resulting in a larger shortfall for

school districts than an equalization order, and resulting in an increased burden on all county

departments charged with performing the new assessment (this would include the Board, who

would be charged with hearing new appeals).

By failing to act, the Board is conducting its own discrimination against property owners

in Jackson County. A “failure [by the Board] to act may have the effect of an intentional

violation of the essential principle of practical uniformity.” Savage v. State Tax Commission, 722

S.W.2d 72, at 78 (Mo. Banc 1986). “If the persons charged with making this assessment refused

to assess [the taxpayer's] property in proportion to its value and in uniformity with all other

taxable property ..., they are presumed to have known that such assessment would be in violation

of sections 4 and 3 respectively, of article 10 of the Constitution of Missouri, and would result in

unlawful discrimination....” Savage at 78, citing Jefferson City Bridge & Transit Co. v. Blaser,

318 MO 373, 300 S.W. 778, 785 (1927). Furthermore, “the action of the assessor was a fraud

entering into the very concoction of the assessment judgment, and such fraud follows the

judgment and is a part thereof through both the county and state boards of equalization.”

Boonville. In other words, the fraud in the assessment follows property valuations into decisions,

or indecisions, made by the Board. By failing to correct the discrimination despite evidence

thereof, the Board is presumed to know that its own inaction regarding equalizing property

valuations across the county would amount to illegal discrimination. In this way, the Board is

Exhibit 5

conducting its own fraud against those taxpayer’s whose properties were assessed at their full

value by allowing those valuations to stand despite the Board’s knowledge that other properties

were intentionally undervalued.

The duty of the Board articulated in May, Koplar, and elsewhere, and the authority of the

Board to enter an equalization order is still questioned by the Board’s attorneys on the grounds

that the cases cited by Legal Aid of Western Missouri are old, and therefore somehow no longer

relevant. This argument is not persuasive. Under Missouri law, Missouri “courts are

constitutionally bound to follow the last controlling decision of Missouri's Supreme Court,

regardless of how many years have passed since that decision was rendered.” See State v. Naylor,

505 S.W.3d 290, 298 (W.D. 2016). The fact that the decision in Black v. McGonigle,7 the

seminal case establishing the Board’s authority to enter an intra-county equalization order, has

been untouched for over 100 years and cited in recent court opinions indicates the strength and

validity of the decision. Moreover, the state legislature has not enacted legislation overturning

this case law despite the opportunity to do so every year since 1890, even when making other

changes to Chapter 138. The legislature’s choice not to act in this context can only be interpreted

as the legislature’s approval of the Supreme Court decisions. The fact that the issue has not been

raised on appeal again does not mean prior caselaw is invalid, but rather illustrates the unique

predicament the Board has been placed in by the 2019 property assessments in Jackson County.

Citizens select and employ their government to act lawfully and fairly and in the public

interest. The citizens of Jackson County have hired you to protect them and to act as a check in

this system. It is your duty to do this work for them. A failure to exercise your authority to enter

an equalization order would be a breach of that duty.

7 103 Mo. 192 (Mo. 1891).

Exhibit 5

Further, in the eyes of the law, should the Board choose not to enter an intra-county order

of equalization, correcting the unlawful discrimination inherent in the 2019 assessment, the

board is treated as an accessory to that discrimination. In Boonville v. Schlotzhauer, the Missouri

Supreme Court held that “[t]he various boards whose united action is by law intended to effect a

uniform assessment on all classes of property are to be regarded as one tribunal, and the whole

assessment on all classes of property is to be regarded as one judgment. If any board which is an

essential part of the taxing system intentionally, and therefore fraudulently, violates the law, by

uniformly undervaluing certain classes of property, the assessment by other boards of other

classes of property at the full value, though a literal compliance with the law, makes the whole

assessment, considered as one judgment, a fraud upon the fully-assessed property.” The Board

becomes complicit in the actions, and failures, of the assessor should it choose not to act where it

has a duty to act.

Misc. - Logistics/Notice Issues:

The County Counselor raised several concerns that an intra-county equalization order

would unfairly burden other county departments because there is not enough time to correct the

assessment, and therefore the assessments should stand. This position ignores the taxpayers’

constitutional rights, the assessor’s duty to taxpayers to perform non-discriminatory assessments,

and the Board’s subsequent duty to address those discriminatory assessments. The County

Counselor is effectively advising the county to allow violations Constitutional and State rights

violations to persist. As the Supreme Court held in Drey,8 “not enough time” is not a valid

reason to allow discriminatory assessments to stand.

8 In Drey v. State Tax Commission, the Missouri Supreme Court found testimony that the assessor “didn’t have time” to physically inspect the properties at issue supported the contention that the assessed valuations were unreasonable. 345 S.W.2d 228 (Mo. 1961). Additionally, the court found the assessor’s testimony that the property was previously undervalued was insubstantial and without value when unsupported by any other testimony. Id.

Exhibit 5

Still, it is understandable that such concerns could affect the Board’s decision-making

process. However, the logistical issues are not as severe as the County Counselor indicated. The

Board would not need to provide notice to taxpayers for any intra-county equalization order, and

there would be no appeal rights generated. As the Supreme Court in May Department Stores

explained:

“The first question which confronts us is whether the validity of the order of the Commission increasing valuations in St. Louis County, on July 6, 1955, may properly be considered in this action. We have determined that it may not. Equalization between counties was a duty expressly imposed upon the Commission by the mandate of § 138.390.9 That order of the Commission did not constitute a ‘contested case’ within the meaning of § 536.100 providing for judicial review of administrative decisions in such matters; § 536.010 defines a ‘contested case’ as a ‘proceeding * * * in which legal rights, duties or privileges of specific parties are required by statute to be determined after hearing.’ In matters thus reviewable under Chapter 536, notice to the parties affected is expressly provided for (§ 536.090), and the petition for review must be filed within 30 days after the mailing or delivery of notice. It would be wholly impracticable for the Commission to give notice of a blanket increase to all owners of real estate in 26 counties, or even in St. Louis County. The order here affected counties and classes of taxpayers, and not ‘specific parties'; and it was not a subject of contest, within the usual understanding of that term. We hold that the equalization order of July 6, 1955, was not a decision of which a review is contemplated under §536.100. By § 536.105, added to the Chapter in 1953, it is provided that decisions of administrative officers or bodies which determine the legal rights, duties or privileges of any person, and which are not subject to administrative review, and for which there is no other provision for judicial inquiry or review, may be reviewed by suit for injunction, certiorari, mandamus, prohibition or other appropriate action. This section clearly comprehends only decisions involving individual rights and interests; this is indicated by the use of such terms as ‘any person,’ the ‘revocation of a license,’ and ‘such person’; Section 536.110 requires the filing of proceedings within 30 days after the mailing or delivery of notice of the administrative decision. As previously stated, no individual notice could possibly be contemplated in connection with county equalization orders of the Commission. Section 536.105, as such, is not applicable to the order of July 6, 1955.”

In sum, an intra-county order of equalization by the Board would affect a class of taxpayers

– agricultural, commercial, residential – not individual property owners. As a result, the Board

9 The language relied upon to describe the STC’s power to equalize values as between counties is identical to the language used to describe the Board’s powers, except the word “counties” is replaced with “parcels.”

Exhibit 5

would not have any duty to provide notice to individual property owners affected by the

equalization order, and there would be no appeal rights generated.

Further, it appears the entry of an intra-county order of equalization would result in a

decreased burden on all affected county departments. Throughout this process, and reiterated at

the special setting, were claims that the Board of Equalization, its staff, the Assessment

Department, and its staff, are overloaded with the burden of this assessment. That the number of

current appeals, the number of late appeals, the miscommunications between the Board and the

assessor department resulting in taxpayers not receiving adequate notice, and the future time

requirements to hear each appeal and correct their valuations within the system will undoubtedly

persist for months into 2020.

The entry of an order of intra-county equalization would, in one order, neutralize each of

these outstanding issues. Individuals who have appealed would, of course, still have an

opportunity to be heard by appeal should they still disagree with their property valuation after

entry of an equalization order by the Board. But, the practical question becomes, who would

appeal such a decision? If the Board were to enter an order modeled upon a cap, the effect would

be that all taxpayers would either receive a reduction to their increase, retain their modest

increase (up to the cap), or keep their decrease. In no case would a taxpayer obtain an increase as

compared to their current assessment.

Lastly, concerns of impracticability ignore all issues that will flow from leaving this

discriminatory assessment in place: additional hardship appeals, currently accepted appeals that

have yet to be docketed and heard, taxes paid under protest, foreclosures flowing from

delinquency and tax sales, and inevitable suits against the county.

Exhibit 5

School Boards

The Board has also heard testimony from representatives of local school boards who are

expected to be the recipients of the coming tax windfall. This windfall is at the expense of

taxpayers, and is the result of an apparent quid pro quo between cooperating school districts and

a compliant and inept county. The chief complaint heard from these school boards is that they

are going to lose money should an order be entered capping valuations county-wide. This is

incorrect, and evidences a misunderstanding of the effect of an intra-county order. Under a

county wide equalization order that sets a value cap at 6% as compared to 2018, the effect would

be an increase in each school board’s budget when compared to fiscal year 2018 and affected

school boards have the additional remedy of appropriately adjusting their levy rates.

Additionally there is the threat of litigation from the school board, should the board choose

to enter an order. Should the board exercise its duty, and should a school board choose to bring

action against the Board, case law makes clear that the school board would lack standing in such

an action. In State ex rel Francois County School District v. C.A. Lalumondier, 518 S.W.2d 638,

(Mo. 1975), which we cited in our memorandum of law, the Missouri Supreme Court held that,

absent express statutory authorization, a political subdivision cannot seek review of a decision on

valuation by a board of equalization. Lalumondier would preclude any office of the county from

bringing suit against the BoE for its intra-county equalization order on valuation, because any

entity under the county would be a political subdivision, which is barred from seeking review of

a board’s decision on valuation.10 The Missouri Supreme Court has expressly held that school

10 Lalumondier is distinguishable from another case, State ex rel. Independence School District v. Jones, 654 S.W.2d 178 (MO. Banc 1983) where the Supreme Court held that a school district has standing to seek a declaratory judgment to challenge a statutory interpretation by the State Tax Commission that threatened the school district’s statutorily-mandated share of state school funds. In Lalumondier the Court inferred a legislative intent to preclude school districts from obtaining judicial review of BoE valuations. In Jones, the Court said that the State Tax Commission does not have the authority to apply percentage-based valuations across different classifications of property: different entities, different issues.

Exhibit 5

districts lack standing to challenge the valuation of real property by their county board of

equalization. Id. As unfortunate as it might be that they wouldn’t be able to fully capture a return

on their investment when they paid for the assessor’s consultant, their threats are moot.

Conclusion

The County Counselor argues it is too late in the game. We argue it is never too late to stop

unlawful activity. The entry of an intra-county order of equalization would solve each problem

presented by the assessor’s office: it would result in a reduced workload by satisfying property

owners who have already appealed, it would protect property owners who failed to appeal, and it

would eradicate the discrimination inherent in the 2019 assessment, fulfilling the Board’s duty to

correct such unlawful discrimination. Lastly, such a county wide equalization order would have

the effect of increasing budgets for recipient school districts as compared with their 2018

budgets. By simply continuing with appeals you are not remedying what the county has done

unless everyone appeals. Short of an appeal of every taxpayer, this discriminatory assessment

stands, and the board of equalization takes part in this unlawful activity.

Exhibit 5

IN THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI AT KANSAS … · property owner for approximately...

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