Court of Appeals of Missouri, Eastern District, Fourth Division
UNION ELECTRIC COMPANY, d/b/a/ AMEREN MISSOURI, Petitioner/Appellant,
BOB ADAMS, ASSESSOR, CAPE GIRARDEAU COUNTY MISSOURI, Respondent.
from the Circuit Court of Cape Girardeau County Honorable
Stephen R. Mitchell
S. Van Amburg, Judge.
appeals the judgment of the circuit court affirming the State
Tax Commission's valuation of Ameren's real and
personal property for purposes of county tax assessments. We
reverse and remand for a determination of value applying
is a regulated public utility that distributes natural gas to
25 counties in Missouri. Ameren's pipeline consists of
both real and personal property subject to county taxation.
This appeal involves its property tax assessment in Cape
Girardeau County as a representative case among four in the
Eastern District and 16 statewide.
Commission oversees tax assessments conducted by individual
counties. As part of its regulatory function, the Commission
requires assessors to collect "such annual reports as
shall enable said commission to ascertain the assessed and
equalized value of all real and tangible personal property
listed for taxation." §138.380.2. To aid in the
collection of such information, the Commission has a
statutory duty to promulgate uniform reporting forms and
instructions for use by assessors and taxpayers.
§138.380(2), §138.320. County assessors must
strictly comply with all such instructions issued by the
Commission. §138.320. And of course, taxpayers must
complete and file the forms in accordance with the
2013, the Commission published a new form and instructions
for natural gas companies to report their real and personal
property for purposes of valuation and assessment. Both the
form and the accompanying instructions directed taxpayers to
start with their original costs, as reported to federal and
state regulatory bodies, and then apply depreciation, using
IRS guidelines and in specific percentages indicated on the
form, to arrive at market value. Prior to 2013, value was
determined from original cost only, without depreciation.
submitted its report in substantial compliance with the
Commission's form and instructions. For its assets in
Cape Girardeau County, Ameren reported original costs of
approximately $42.9 million and a depreciated value of $19.9
million, for an assessed value of $6.4 million. Noting a
decrease in relation to previous years, the respondent
Assessor questioned Ameren's figures, believing that
Ameren had applied double depreciation. As such, the Assessor
used an initial figure of $39.5 million and made no deduction
for depreciation, for an assessed value of $12.7 million.
similar discrepancy occurred in 15 other counties. In each
county, Ameren appealed the Assessor's determination to
the county Board of Equalization, which sustained the
Assessor's valuation. Ameren then appealed all 16
determinations to the Commission, where the cases were
consolidated and the parties appeared and adduced voluminous
evidence. As relevant here, Ameren established that its
figures reflected its actual original costs, as reported to
regulatory bodies, minus depreciation, all as required by the
Commission's reporting form and instructions. The
Assessors established that the 2013 form and instructions
deviated from past practices and acknowledged that their
suspicion of double depreciation was unfounded. The Assessors
then sought to demonstrate that their own valuations were
nonetheless valid, based on an appraisal that they
commissioned later using different methodologies. As relevant
here, that appraisal indicated that the "reproduction
cost new" of Ameren's assets in Cape Girardeau
County was $81.4 million, yielding an after-depreciation
value of $39.8 million, consistent with the Assessor's
initial figures. Thus, the proposed valuations can be
compared as follows:
$42.9 M original
$39.5 M original
$81.4 M new
Commission affirmed the Assessors' valuations, reasoning
that Ameren failed to prove the value of its assets with
market evidence whereas the Assessors provided support for
their valuations with the appraisal. The trial court affirmed
the Commission's decision by the same rationale. Ameren
appeals and asserts that the Commission erred in that (1) the
Assessor misapplied the cost approach method of valuation by
failing to account for depreciation, (2) the Commission
failed to review Ameren's claim of methodological error
but instead weighed the evidence of valuation under an
entirely different method, (3) Ameren did present evidence of
value, and (4) there is no presumption in favor of the
this appeal was pending, the Western and Southern Districts
of this court issued opinions in identical representative
cases, reversing the Commission's decision and remanding
for a determination of value using proper methodology.
Union Elec. Co. v. Estes, No. WD80659, 2017 WL
4244396 (Mo. App. W.D. Sept. 26, 2017), motion for rehearing
or transfer denied Oct. 31, 2017; Union Elec. Co. v.
Tibbs, No. SD34934 (Mo. App. S.D. Oct. 31, 2017). We now
concur with our colleagues in analysis and result.
Court reviews the decision of the Commission and not the
decision of the trial court. Snider v. Casino Aztar/Aztar
Missouri Gaming Corp.,156 S.W.3d 341, 346 (Mo. 2005).
We review to determine "whether the Commission's
decision is supported by competent and substantial evidence
upon the whole record, or whether it was arbitrary,
capricious, unreasonable, unlawful, or in excess of the
Commission's jurisdiction." Id., citing
§536.140.2. Determining value is an issue of fact for
the Commission. Aspenhof Corp. v. State Tax
Commission,789 S.W.2d 867, 869 (Mo. App. E.D. 1990).
However, "whether the appropriate standard of value and
approach to valuation were properly applied under the
particular facts and circumstances of the ...