                                                      In the
                                Missouri Court of Appeals
                                            Western District
 CATHY RINEHART, ASSESSOR                                   )
 CLAY COUNTY, MISSOURI,                                     )
                                                            )    WD83105
                      Appellant,                            )
                                                            )    OPINION FILED: August 18, 2020
 v.                                                         )
                                                            )
 LACLEDE GAS COMPANY,                                       )
                                                            )
                    Respondent.                             )

                   Appeal from the Circuit Court of Clay County, Missouri
                            The Honorable Kathryn E. Davis, Judge

Before Division Three: Gary D. Witt, Presiding Judge, Lisa White Hardwick, Judge and
                            Thomas N. Chapman, Judge


         Cathy Rinehart, Assessor of Clay County, Missouri, ("Assessor") appeals from the

Circuit Court of Clay County's judgment affirming the State Tax Commission's

("Commission") Order finding the true value in money ("TVM")1 of Laclede Gas

Company's ("Laclede")2 personal property was $7,100,000.00 in 2014, and $8,900,000.00



         1
           "True value in money is the fair market value of the property on the valuation date, and is a function of its
highest and best use, which is the use of the property which will produce the greatest return in the reasonably near
future." Snider v. Casino Aztar/Aztar Mo. Gaming Corp., 156 S.W.3d 341, 346 (Mo. banc 2005) (quoting Aspenhof
Corp. v. State Tax Comm’n, 789 S.W.2d 867, 869 (Mo. App. E.D. 1990)).
         2
           Laclede has since been acquired by Spire Missouri, Incorporated, but we refer to it as Laclede for
continuity and convenience.
in 2015. The Commission determined the assessed value of Laclede's personal property

was $2,366,667.00 in 2014 and $2,966,667.00 in 2015. The Commission also found the

TVM of Laclede's real property was $52,500,000.00 in 2015, and its real property's

assessed value was $16,800,000.00 in 2015.3 We reverse and remand.

                                     Factual and Procedural Background

          Laclede is a utility company that provides natural gas service throughout Missouri

by means of gas service lines, mains, and other facilities, and it is regulated by the Federal

Energy Regulatory Commission ("FERC") and the Missouri Public Service Commission

("PSC"). Laclede reports the cost of its assets to the PSC, which impacts the rate Laclede

charges its customers for its service.

          In September 2013, Laclede purchased both real and personal property from

Missouri Gas Energy ("MGE") located in Clay County, Missouri.4 Its real property

consists of underground pipes and gas mains of varying ages, materials, and sizes, and its

personal property consists of meters and regulators. Laclede's property also includes new

assets that are being constructed and assets that are provided by others to assist in

construction and expansion of Laclede's gas distribution system. A dispute arose between

the Assessor and Laclede as to the proper TVM of Laclede's real and personal property

located in Clay County.



          3
              The assessed value of Laclede's real property in Clay County for the 2014 tax year is not at issue in this
appeal.
         4
           Laclede also purchased property located in Platte County, Missouri. The Commission consolidated
appeals from Clay County and Platte County in the underlying matter. However, the Platte County Assessor did not
appeal the Commission's decision, therefore the assessed value of Laclede's personal and real property located in
Platte County is not at issue in this appeal.

                                                              2
        Lindsay Link ("Link"), a Laclede accountant, prepared Laclede's tax declarations

using Laclede's Fixed Asset Record, which is filed with the PSC and audited by an outside

accountancy firm. The Fixed Asset Record contains the vintage year,5 FERC account

number, location of property within Clay County, and the original cost of all property.

However, the Fixed Asset Record does not include all of Laclede's real and personal

property because the PSC does not assess rates based on construction work in progress and

assets used during construction. Link determined that prior to Laclede's purchase, MGE

had improperly included its meter installation costs in its personal property tax

declarations, which resulted in the over-valuation of MGE's personal property.

        Rochelle Lafave, Director of Personal Property for the Assessor, disagreed with

Laclede's personal property tax declarations and calculated the TVM of Laclede's personal

property utilizing MGE's 2012 personal property tax declarations.                                Gary Maurer

("Maurer"), a general appraiser for the Assessor, disputed Laclede's real property tax

declarations. Maurer determined a gas line's life expectancy to be between 50 and 75 years,

and Maurer applied a 70-year depreciation schedule to Laclede's assets. Maurer testified

that in calculating the TVM of Laclede's real property, he used 1997 as the vintage year of

all property installed before 1997 because the data provided by Laclede to the Assessor did

not include any vintage years for property installed before 1997.6 Maurer acknowledged

that the inaccurate vintage years would affect the depreciation schedule and therefore result

in a higher assessed value for the older personal property.


        5
          The vintage year is the year the pipe was placed into service.
        6
          It is unclear from the record, which appraisal approach Maurer used in calculating the TVM of Laclede's
real property.

                                                        3
         Laclede's declared TVM and the Assessor's TVM were as follows:

                                 2014 Personal      2015 Personal      2015 Real
 Laclede's Declaration                   $6,200,000         $6,400,000       $38,000,000
 Assessor's TVM                        $11,300,000        $11,100,000        $79,200,000

Laclede appealed the Assessor's valuations to the Clay County Board of Equalization

("Board"). The Board adopted the Assessor's valuations. Laclede appealed the Board's

valuations to the Commission, and this appeal was heard by a Senior Hearing Officer on

March 29, 2017, and March 30, 2017.

         At the hearing, the Assessor called Mika Koyama ("Koyama"), a Systems and

Standards Analyst for the Assessor's Office, to testify as an expert as to her valuations of

Laclede's real and personal property. Koyama utilized the Unit Value Method7 using the

cost approach in calculating Laclede's TVM. Koyama determined that Laclede purchased

MGE for $975,000,000 and she subtracted the value of MGE's intangible assets,

$370,000,000, from the sales price for a total value of the property being $605,000,000.

She then determined that 14% of MGE's assets were located in Clay County. Koyama

applied a fifty-year depreciation schedule with a 20% floor.                               Ultimately, Koyama

determined the TVM of Laclede's personal property to be $12,000,000 for both 2014 and

2015, and the TVM of Laclede's real property to be $73,763,600 for 2015.




         7
           The Unit Value Method "is an appraisal technique that produces a valuation of a whole property without
geographical or functional division of the whole. This technique is most applicable in the valuation of public utility
and railroad properties in which the operating property of the business enterprise in its entirety is valued as a unit.
After the unit value is determined, each taxing jurisdiction is apportioned or allocated the portion of the unit value
applicable to the amount of distributable property contained therein." ASSESSOR MANUAL, Appendix (Mo. State
Tax Comm'n 2020).

                                                           4
      Laclede called Robert Reilly ("Reilly") as its expert witness, and Reilly calculated

Laclede's property value utilizing the Unit Value Method using the cost approach, the

income approach, and the comparable market approach, giving 40% weight to the cost

approach, 40% weight to the income approach, and 20% weight to the comparable market

approach. Reilly calculated the total unit value was $1,280,000,000 (cost approach);

$1,110,000,000 (income approach); and $1,350,000,000 (comparable sales approach).

Applying his assigned weights, Reilly calculated the combined total unit value was

$1,226,000,000.

      From the total unit value, Reilly subtracted the total value of financial assets and

intangible assets ($310,000,000) for an adjusted total unit value of $916,000,000. Reilly

calculated that the property located within Clay County was 5.3% of the total unit value

for a sub-unit value of $48,500,000. He then found that 14.6% of the sub-unit value

comprised Laclede's personal property ($7,100,000) and 85.4% of the sub-unit value

comprised Laclede's real property ($41,400,000).

      The Commission summarized the relevant valuations as follows:

                         2014 Personal      2015 Personal      2015 Real
 Laclede's Declaration           $6,200,000         $6,400,000       $38,000,000
 Assessor's TVM                $11,300,000        $11,100,000        $79,200,000
 Board's TVM                   $11,300,000        $11,100,000        $79,200,000
 Reilly's Testimony              $7,100,000         $8,900,000       $52,500,000
 Koyama's Testimony            $12,000,000        $12,000,000        $73,800,000

      On September 6, 2017, the Hearing Officer entered his Decision and Order

("Decision"), affirming the Board's TVM. Laclede appealed to the Commission, and on

August 7, 2018, the Commission entered an Order Setting Aside Hearing Officer Decision

                                           5
upon Application for Review ("Order") adopting the valuations set forth by Reilly. The

Commission determined Laclede's TVM and Assessed Value as follows:

                               2014 Personal      2015 Personal      2015 Real
 Commission's TVM                      $7,100,000         $8,900,000        $52,500,000
 Commission's                          $2,366,667         $2,966,667        $16,800,000
 Assessed Value

         On September 5, 2018, the Assessor filed a Petition for Review in the Circuit Court

of Clay County. The circuit court conducted a hearing on July 12, 2019, and entered its

Judgment affirming the Commission's Order on August 2, 2019. This appeal timely

followed.

                                             Standard of Review

         "On an appeal from a judgment of a trial court addressing the decision of an

administrative agency, we review the decision of the administrative agency and not the

judgment of the trial court." Union Elec. Co. v. Estes, 534 S.W.3d 352, 365 (Mo. App.

W.D. 2017) ("Estes") (quoting Rinehart v. Bateman, 363 S.W.3d 357, 362-63 (Mo. App.

W.D. 2012)). "This court reviews the decision of the [Commission] and not the hearing

officer[.]" Rinehart, 363 S.W.3d at 363 (quoting Cohen v. Bushmeyer, 251 S.W.3d 345,

350 n. 4 (Mo. App. E.D. 2008).8 "Notwithstanding, in our mandate, we reverse, affirm or


         8
           In Rinehart, we reviewed the Commission's decision together with the hearing officer's order because the
Commission had incorporated the entirety of the decision of the hearing officer into its order. 363 S.W.3d at 363
(citing Loven v. Greene Cnty., 94 S.W.3d 475, 477 (Mo. App. S.D. 2003); Peruque, LLC v. Shipman, 352 S.W.3d
370, 374 (Mo. App. E.D. 2011)). The Assessor argues that in the instant case the Commission incorporated the
Hearing Officer's Decision and Order, and as a result we should consider both the Commission's Order and the
Hearing Officer's Decision and Order. However, the Commission expressly stated: "Segments of the Decision and
Order of the Hearing Officer, including the findings of fact and conclusions of law therein, have been incorporated
without reference, as if set out in full, in this final decision of the [Commission]." (emphasis added). Because only
segments of the Hearing Officer's Decision and Order were incorporated into the Commission's Order, and because
the Hearing Officer and the Commission reached different outcomes our review is limited to the Commission's
Order.

                                                          6
otherwise act upon the judgment of the trial court." Estes, 534 S.W.3d at 365 (quoting

Rinehart, 363 S.W.3d at 363). We must determine "whether the [Commission's] findings

are supported by competent and substantial evidence on the record as a whole; whether the

[Decision and Order] is arbitrary, capricious, unreasonable or involves an abuse of

discretion; or whether the [Decision and Order] is unauthorized by law." Id. (quotation

omitted). However, "we review the [Commission's] conclusions of law and its decision de

novo, and we make corrections to erroneous interpretations of the law." Id. (quotation

omitted). "Whether the appropriate standard of value and approach to valuation were

properly applied under the particular facts and circumstances of the case is a question of

law." Id. (quoting Snider v. Casino Aztar/Aztar Mo. Gaming Corp., 156 S.W.3d 341, 346

(Mo. banc 2005)).

                                        Discussion

       The Assessor raises one point on appeal asserting that the Commission erred in

setting aside the Board's valuations because Laclede failed to meet its burden of proof to

present substantial and persuasive evidence to rebut the presumption of correct assessment

by the Board in that the evidence of TVM produced by Laclede failed to properly apply

accepted appraisal methodologies.      Laclede first argues that the General Assembly

legislatively abolished the rebuttable presumption that the Board's valuations are correct,

and even if the presumption persists Laclede met its burden to rebut them. Therefore, we

must first determine whether the 1992 legislative amendments abolished the presumption

in favor of boards of equalizations' valuations.



                                             7
I. The legislative amendments to section 138.431 preserved the presumption in favor
of the Board's valuations.

       While no statute establishes the rebuttable presumption that the boards of

equalizations' valuations are correct, historically the judiciary has recognized a rebuttable

presumption that the assessments of county assessors, boards of equalization, and the

Commission are correct. State ex rel. Thompson v. Bethards, 9 S.W.2d 603, 604 (Mo. banc

1928) ("The presumption that such added valuation is the true value attaches just as well

to the action of the state board of equalization and county board of equalization as it does

to the valuation of the assessor."); May Dep't Stores Co. v. State Tax Comm'n, 308 S.W.2d

748, 759 (Mo. 1958) ("There is a presumption of validity and of good faith in the actions

of taxing officials, and of the correctness of assessments[;] and such presumptions attach

to the actions of the county and state boards of equalization, as well as to the valuations of

assessors.") (internal citations omitted); State ex rel. Kahler v. State Tax Comm'n, 393

S.W.2d 460, 465 (Mo. 1965) (holding that presumption that county boards of equalization's

assessments are valid is rebuttable); Quincy Soybean Co., Inc. v. Lowe, 773 S.W.2d 503,

504 (Mo. App. E.D. 1989) ("A presumption exists that the assessed value fixed by the

assessor, [b]oard of [e]qualization, or commission is correct."). Because "[t]he legislature

is presumed to know the law that has been amended, and to have used particular words in

light of prior judicial and legislative action," we presume the legislature knew that

valuations by assessors, boards of equalization, and the Commission were presumed to be

correct. State v. Davis, 675 S.W.2d 410, 415 (Mo. App. W.D. 1984) (citing City of St.

Joseph v. Hankinson, 312 S.W.2d 4, 8 (Mo. 1958)). In 1992 the legislature amended


                                              8
sections 138.060.1 and 138.431.39 RSMo. Cum. Supp. 1992 to insert the language: "There

shall be no presumption that the assessor's valuation is correct."

        Laclede argues that because the legislature abolished the presumption in favor of

the Assessor's valuation that when the Board sustained the Assessor's valuation, the

practical effect of the amendment to 138.431.4 was to abolish the presumption in favor of

the Board's valuations. We disagree. "In matters of statutory interpretation, this Court's

role is to ascertain the intent of the legislature from the language used and to consider the

words used in their ordinary meaning." Macon CT. Emergency Servs. Bd v. Macon Caty.

Comm'n, 485 S.W.3d 353, 355 (Mo. banc 2016). "Where a statute's language is clear,

courts must give effect to its plain meaning and refrain from applying the rules of

construction unless there is some ambiguity." St. Louis CT. v. Prestige Travel, Inc., 344

S.W.3d 708, 714 (Mo. banc 2011) (quoting Ross v. Dir. Of Revenue, 311 S.W.3d 732, 735

(Mo. banc 2010)). Moreover, "[t]his Court will not add words to a statute under the auspice

of statutory construction" strict or otherwise. Li Lin v. Ellis, 594 S.W.3d 238, 242 (Mo.

banc 2020) (quoting Macon, 485 S.W.3d at 355). Interpreting section 138.431.4, while

giving its terms their plain and ordinary meaning, we find that the legislature abolished the

rebuttable presumption in favor of the assessor's valuations but left the rebuttable

presumption in favor of valuations by boards of equalization and the Commission intact.

If the legislature wished to eliminate the rebuttable presumption in favor of the boards of

equalizations' or commission's valuation, it knew how and chose not to do so.


        9
        In 1992, the amendment adding the relevant language was made to subsection 3 of 138.431. Subsequent
amendments to the statute moved the relevant language of subsection 3 to subsection 4.

                                                     9
       Laclede further argues that because section 138.431.4 provides authority for the

Commission to review the Board’s valuation rather than the Assessor's valuation that the

legislature's failure to abolish the presumption in favor of the Board would render the

legislative amendment a useless act. We disagree. "When the legislature amends a statute,

it is presumed that its intent was to bring about some change in the existing law." Kolar v.

First Student, Inc., 470 S.W.3d 770, 777 (Mo. App. E.D. 2015). "This Court should never

construe a statute in a manner that would moot the legislative changes, because the

legislature is never presumed to have committed a useless act." Id. "To amend a statute

and accomplish nothing from the amendment would be a meaningless act." Id. The board

of equalization conducts an independent review of the assessors' valuations, and therefore,

they are separate and distinct valuations even if they ultimately find the assessor's valuation

to be persuasive. Furthermore, while county assessors do not have standing to appeal the

boards of equalizations' valuations, O'Flaherty v. State Tax Comm'n of Mo., 680 S.W.2d

153, 154 (Mo. banc 1984), nothing precludes a county assessor from presenting evidence

of its initial valuation to the Commission when a taxpayer appeals a board of equalization's

valuation. Therefore, the legislative amendment abolishing the presumption in favor of the

county assessor's valuation was not a meaningless act, as the assessor's valuation may be

presented at any stage of the appeals process. In reviewing the board of equalizations'

valuation, the Commission may consider the assessor's initial valuation, but, after the 1992

statutory amendment, the Commission can no longer apply a rebuttable presumption that

the assessor's initial valuation was accurate. Therefore, the Commission was obligated to

give the Board's valuation a presumption of validity.

                                              10
II. Laclede successfully rebutted the presumption that the Board's valuations were
presumed to be correct.

       Having found that there is a rebuttable presumption that the Board's valuations are

correct, we must now determine whether the Commission's Order finding that Laclede

overcame this presumption is supported by substantial and competent evidence. Estes, 534

S.W.3d at 365. "Substantial evidence is evidence that if true has probative force; it is

evidence from which the trier of fact reasonably could find the issues in harmony

therewith." Preston v. Dir. of Revenue, 202 S.W.3d 608, 609 (Mo. banc 2006). Laclede

argues that the Board's valuations were rebutted because the Board failed to properly

account for depreciation in arriving at its valuations.

       In Estes, we reversed the Commission's determination of the TVM of Ameren

Missouri's, a regulated public utility, natural gas pipeline within the county, because the

Commission did not account for depreciation. Estes, 534 S.W.3d at 377. The Commission

affirmed the assessor's valuations, which had been sustained by the board of equalization.

Id. at 376. We held that "[d]epreciation must be considered when valuing property using

the reproduction cost approach." Id. (citing Stephen & Stephen Props., Inc. v State Tax

Comm'n, 499 S.W.2d 798, 803 (Mo. 1973) ("Whenever consideration is given to the cost

of reproduction as an element in the determination of market value, it is recognized that a

proper deduction must be made for depreciation." (internal quotation omitted)). Because

the board of equalization had not considered any depreciation we found the Commission's

adoption of those valuations was "unlawful and unfair." Id.




                                             11
        Although, in the instant case, the Assessor accounted for some, but not all,

depreciation, we similarly find the Commission's valuations unlawful and unfair.

Specifically, Maurer testified regarding the methodology he used in establishing the

Assessor's values as follows:

        [Counsel]. Did you use a placed in service date of 1997 for all of Laclede's
        real property?

        [Maurer]. Not a year – by the way you're stating it, yes, but it's incorrect.

        Q. Okay. What's incorrect about it?

        A. That figure is – that year is – when it was cut off of the MACRS[10]
        schedule and also what they turned in, Laclede dropped – started dropping
        off in 1997. It should have continued down to 1950 on all of their stuff. They
        didn't do it so I can only go with what I've got from Laclede.

        Q. So for a pipe with a vintage of 1960 –

        A. It's included in that 1997. Laclede did that. 'Cause you'll notice it says
        1997 or prior in their figures.

        ...

        Q. And would that have resulted in a lower assessed value?

        A. I'm sure it would.

While the initial information provided to the Assessor by Laclede failed to provide the

vintage years for certain personal property such as pipelines that were placed in service

before 1997, the record demonstrates that Laclede provided the Assessor with an amended

list of property with the correct vintage years when Laclede became aware that the Assessor


         10
            MACRS is the modified accelerated cost recovery system, which is a depreciation schedule contained in
the Internal Revenue Code in 26 U.S.C. § 168 (2018). The Assessor, Koyama, and Reilly each used MACRS in
calculating Laclede's depreciation, which is consistent with State Tax Commission Guidance. See, Union Elec. Co.
v. Adams, 539 S.W.3d 779, 783 (Mo. App. E.D. 2017).

                                                       12
did not have the proper vintage years for all of its property. The Assessor, and the

Assessor's experts failed to amend the valuation based on this information prior to the

Board's hearing.

       The Assessor admitted that she did not properly apply the depreciation schedule,

even though she had the necessary information to properly make those calculations, and

this resulted in a higher assessed value. This admission renders the Assessor's valuations

unreasonable, and therefore the Board’s adoption of those valuations unreasonable. "It is

important for the assessor to arrive at a reasonable level of depreciation." See Estes, 534

S.W.3d at 358 (citing ASSESSOR MANUAL, VII-7.4-1 (Mo. State Tax Comm'n, Feb. 5,

2015)). On these specific facts, we find that the Board erred in sustaining the Assessor's

initial valuation because the Assessor unreasonably failed to consider and properly

calculate depreciation based on the vintage years of the property. Therefore, Laclede

produced substantial and competent evidence from which the Commission could find the

presumption that the Board's valuations are correct was rebutted.

       This does not end the inquiry however, because Laclede not only has the burden to

demonstrate the Board's valuations are incorrect, Laclede also has the burden to establish

the value that should have been placed on the property. Snider, 156 S.W.3d at 346; Tibbs

v. Poplar Bluff Assocs. I, L.P., 599 S.W.3d 1, 7 (Mo. App. S.D. 2020).




                                            13
III. Laclede did not provide substantial and competent evidence to establish the TVM
of its personal and real property because the Commission adopted Reilly's valuation,
which incorporated the cost approach, the comparable sales approach, and the
income approach.

      "Determining value is an issue of fact for the Commission[; h]owever, 'whether the

appropriate standard of value and approach to valuation were properly applied under the

particular facts and circumstances of the case is a question of law," which we review de

novo. Union Elec. Co. v. Adams, 539 S.W.3d 779, 782 (Mo. App. E.D. 2017) ("Adams")

(quoting Aspenhof Corp. v. State Tax Comm'n, 789 S.W.2d 867, 869 (Mo. App. E.D.

1990)). "For purposes of levying property taxes, the value of real property is typically

determined using one or more of three generally accepted approaches." Snider, 156 S.W.3d

at 346. "These three approaches include the cost approach, the comparable sales approach,

and the income approach (also known as income capitalization)." Tibbs, 599 S.W.3d at 8

(citing Snider, 156 S.W.3d at 346-48; Mo. Baptist Children's Home v. State Tax Comm'n.,

867 S.W.2d 510, 511 n.3 (Mo. banc 1993)).

      However, in 2013, the Commission mandated that assessors use the reproduction

cost approach to value natural gas pipeline companies’ real and personal property. Estes,

534 S.W.3d at 367; Adams, 539 S.W.3d at 783. Similarly, the Commission continued to

mandate the use of the reproduction cost approach for tax years 2014 and 2015. See Estes,

534 S.W.3d at 358 (citing ASSESSOR MANUAL, VII-7.4-1 (Mo. State Tax Comm'n, Feb. 5,

2015)). Also, section 137.122 requires assessors to use the reproduction cost approach for

business personal property in use after January 1, 2006. Consistent with Estes and Adams,




                                           14
we hold that the Commission is obligated to use the reproduction cost approach in the

instant case.11

        In Adams, the assessor combined, "income, market, and cost 'new' approaches—

every possibility except the original (historical) cost approach mandated by the

Commission for the year in question" to calculate the value of a natural gas distribution

company. 539 S.W.3d at 783. The court reversed and remanded the matter back to the

Commission to apply the "proper methodology as prescribed by Commission publications

in effect for the relevant period." Id. at 784. Similarly here, the Commission adopted

Reilly's valuations, and because Reilly combined income, market, and cost approaches, we

find the Commission failed to follow its own mandate. Therefore, we must reverse and

remand for a determination of TVM by properly applying the reproduction cost approach

as mandated by Commission publications for the 2014 and 2015 tax years.

        Laclede further argues that this Court lacks authority to determine which approach

the Commission should adopt. See Hermel, Inc. v. State Tax Comm'n, 564 S.W.2d 888,

896 (Mo. banc 1978) ("[I]t is not within the purview of this court to determine the method

of valuation to be adopted by the commission"). But, in accord with Hermel, Inc., we are

not determining the method of valuation to be adopted by the Commission, instead we




          11
             Laclede argues that the Commission did not require the reproduction cost approach method for public
utility property citing a string of cases where alternative valuation methods were used. However, because these
cases precede the Commission's 2013 mandate, we do not find them persuasive. See Bussman Div. of Cooper
Indus./McGraw Hill v. State Tax Comm'n, 802 S.W.2d 543 (Mo. App. E.D. 1991) (1986 tax year); Harrah's Md.
Heights v. Zimmerman, 2014 WL935759 (Mo. State Tax Comm'n) (2011 and 2012 tax years); Doe Run Co. v.
Holman, 1999 WL1253948 (Mo. State Tax Comm'n) (1997 tax year).

                                                        15
merely hold that the Commission must follow the rules that it has adopted and use the

reproduction cost approach.

        Laclede also asserts the proper methodology is the Unit Value Method. See Iron

Mountain Trap Rock v. Ward, 2015 WL7294788 (Mo. State Tax Comm'n) (approving use

of the Unit Value Method to value a quarry). This is an issue that is best determined by

the Commission. Lebanon Props. I. v. North, 66 S.W.3d 765, 767 (Mo. App. S.D. 2002)

("Ascertainment of proper methods of valuation is delegated to the [C]omission.") (citing

C & D Inv. Co. v. Bestor, 624 S.W.2d 835, 838 (Mo. banc 1981)).                                  Because the

reproduction cost approach does not preclude the application of the Unit Value Method,

we leave it to the Commission to determine whether the Unit Value Method is appropriate

in this case and whether it has been properly applied.12

        Furthermore, Laclede asserts that Koyama's methodology was fundamentally

flawed rendering her report "unreliable and the valuations therein not indicative of the

TVM of Laclede's property." Similarly, the Assessor argues that Reilly's methodology is

not founded on reliable appraisal methods. Our Supreme Court "has acknowledged 'the

wisdom of the General Assembly in providing an administrative agency to deal with this

specialized field." Savage v. State Tax Comm'n, 722 S.W.2d 72, 75 (Mo. banc 1986)

(internal quotation omitted). We are "loathe to substitute [our] judgment for the expertise

of the Commission in matters of property tax assessment." Id. However, "[o]nce the

commission decides to use a particular [valuation] approach, it must apply that approach


        12
           We note that both Koyama and Reilly (in part) utilized the Unit Value Method combined with the cost
approach in reaching their conclusions.

                                                       16
properly and consider all of the factors relevant to that approach." Estes, 534 S.W.3d at

370 (quoting Snider, 156 S.W.3d at, 348).

                                       Conclusion

      The judgment of the circuit court affirming the Commission's Decision and Order

is reversed. This matter is remanded to the Circuit Court of Clay County for remand to the

Commission to calculate, in a manner consistent with this opinion, the TVM of Laclede's

real and personal property in service in Clay County as of January 1, 2014 and January 1,

2015 through use of the reproduction cost approach.




                                         Gary D. Witt, Judge

All concur




                                            17
