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The Senate Select Committee on Property Tax Reform met on September 20 to hear invited and public testimony on interim charges related to voter engagement in property tax elections, management of property tax data, and the operations of appraisal review boards (ARBs).

This report is intended to give you an overview and highlight of the discussions on the various topics the committee took up. It is not a verbatim transcript of the hearing, but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.

 

Opening Comments

  • Bettencourt – Have been told from the Senate side that property tax reform bill will be second priority next to school safety; planning on SB 2

 

Study and recommend ways to enhance voter engagement in local government decisions around budgets and property tax rates through digital media and social media.

  • Bettencourt gave a presentation on property tax trends in Texas (Link)
    • Many counties have significant growth in tax levy from 2013-2017, Harris County is highest at 51.1% growth; cities follow a similar trend
    • Dallas Morning News conducted an independent investigation
    • Important to discuss school side of tax bill as well, have been discussing weaning off of ‘Robin Hood’
    • Bettencourt anticipating increasing trend will continue, property tax reform is a crucial legislative effort
  • Lucio – Discusses existing methods for voting engagement, many are not aware of the hearing and notice requirements
  • Bettencourt – Will be discussing if the current system is working, currently have poor media outreach

 

Jennifer Rabb, Rice University McNair Center for Entrepreneurship & Economic Growth

  • Dissatisfaction with property tax is not only due to growth, but also because property owners and legislature expect that it can be controlled/is predictable
  • In spite of the expectation, there is a lack of control & people are unhappy; Legislature has methods that can increase control
  • Gives overview of calculating tax levy, current system determines taxable value first and then tax rate second
  • Current system leads to imbalance in taxpayer participation; overrepresentation in appraisal and underrepresentation in rate setting; appraisal protests are numerous, but few attend rate hearings
  • Many protest due to high tax rate, but this is not the appropriate way to contest high rates
  • Appraisal process is not discretionary/difficult to change as it is set in TX Constitution, tax rate is discretionary aside from max limits in law
  • Opposing appraised value is an individual act and easily doable, but opposing a tax rate involves being present at multiple hearings & needs wide support
  • Lucio – Given that notices can be destroyed or stolen, wouldn’t it also be smart to post rate notices online?
    • Yes, agreed, does not believe these can’t be sent by email as well
  • Appraisal notices are also confusing, publish inaccurate info
  • Legislature should eliminate misleading estimates from the notice, also has the opportunity to create an individual tax rate notice similar to appraisal notices
  • Could also let taxpayers submit position on proposed tax rates online without need to be present at rate hearing
  • Perry – Are you suggesting that the online position could become a quasi-petition?
    • Wouldn’t suggest it takes place of hearings or rollback process, but in addition to; could be useful info & could require taxing units to read into record
  • Bettencourt – Are we ignoring the obvious with internet involvement, input could be submitted easily online
    • This is exactly right, could be an individual act that can be done from home
  • Bettencourt – Certainly very complicated for the taxpayer
  • Hancock – Have also had issues with constituents were appraisal notice doesn’t identify senior citizens, homestead exemptions, etc.; Many think their taxes are going up significantly even though the report doesn’t reflect frozen rates
    • I think this is an issue
  • Hancock and Rabb discuss difficulty of understanding appraisal notices, especially for senior citizens, etc.; leads to protest action that won’t necessarily help their ultimate rate
  • Bettencourt – There is a structure issue as these freezes are often recorded in other places; some counties do publish this on the appraisal notice
  • Bettencourt presents slides with hypothetical of four properties with existing levy, adds 2 properties with higher values to reach an almost double tax levy
    • Rabb explains there are two points in the hypothetical, effective tax rate is the rate that would raise the same amount on the same property as last year
    • Well-meaning local government officials will say that the taxes have not been raised, yet tax rate being kept level means more revenue generation
    • Tax rate isn’t as transparent as we would like it to be
  • Bettencourt – This is why effective tax rate language exists; if rate is above the effective rate, it is a tax increase; further discusses the hypothetical with Rabb
    • Point of appraisal process is not to determine what you will pay in taxes, but to determine your total share of whatever the tax burden is
  • Bettencourt – Many are not aware of what their property is appraised for, but they do have their own idea of the value of their property

 

Victoria Farrar-Myers, City of Arlington

  • City of Arlington increased its reach and diversified messaging through townhalls, social media, livestreams, web development, etc.
  • Includes budget breakdown posts on Facebook, have seen many participate in these postings
  • Bettencourt – So you are seeing engagement in a virtual townhall?
    • Yes, trying to reach taxpayers where they are
  • Hancock – Seems like this constituency is more engaged in local government
    • Yes, large amount of Arlington outreach leads to higher engagement and attendance
  • Can’t say that every resident was reached by the city campaign, but is confident Arlington strategy has led to more engagement
  • Arlington has also received 5 stars on process transparency from Comptroller’s Office
  • Bettencourt – Just to be clear you aren’t saying you have participation by a number higher than your population?
    • No, one person can view a Facebook posting multiple times; not a reflection of population

 

Sam Taylor, Texas Secretary of State

  • Speaking on statewide voter outreach efforts, particularly voter ID
  • Legislature has dedicated $4 million per biennium over last 2 sessions for voter ID education, split to reach as many as possible during election periods
  • Litigation recently ended, now under SB 5, looking to maximize outreach through social media and traditional methods
  • Also partnered with a few universities to provide information to students
  • Bettencourt gives a presentation, has examples of appraisal notices
  • Bettencourt – These notices are even unintelligible to tax professionals, better examples exist, but info is still very complicated
  • Bettencourt provides an overview on election participation
    • Turnout varies depending on enthusiasm, also need to remember constitutional amendment elections; turnout varies depending on issues on ballot
  • Bettencourt – We have turnouts partly due to jurisdictions cherry-picking dates based on when they feel they can best pass a measure
  • Bettencourt – If a jurisdiction is affecting the tax rate, we need to move elections to November when there is some turnout, currently have preposterously low numbers
    • Much more likely to get higher turnout on these dates
  • Bettencourt also presents in on Tax Ratification Elections
  • Bettencourt – These elections reflect enormous impacts on tax bills

 

Jay Socol, City of College Station, Texas Association of Municipal Information Officers

  • Outreach measures can be very resource intensive, some communities only have a few staff & they do not have the ability to create and maintain social media outreach
  • Many can also not pay to amplify the message
  • Should carefully consider the lengths to which outreach is mandated
  • Hancock – No one wants to over-legislate anything, but we don’t legislate anything at all for those doing things properly; bad actors give rise to legislation
  • Hancock – When you look at election dates, etc., you can see abuses of freedom in some jurisdictions
  • Bettencourt – What is College Station doing in comparison to Arlington?
    • Very similar activities, social media, and printed information
    • Also work closely with news media to relay
  • Bettencourt – Do you adopt the effective tax rate or do you lower rate as values go up?
    • Right now we are proposing a slight increase to offset a recent homestead exemption
  • Perry – Taxing units overriding exemptions we provide is one of the reasons for these discussions
  • Perry – I think you make some valid points in small jurisdictions, many of my constituents are not active on modern media, important to consider realities of rural jurisdictions short on resources
  • Perry – Concerned about opportunities to waste taxpayers dollars; gives example of communities laying fiber optics without communicating with stakeholders
  • Bettencourt – You started a homestead exemption this year?
    • Started one, went from 0% to 5%
  • Bettencourt – So you started an exemption, and how much are you increasing the tax rate?
    • Don’t have that info in front of me
  • Bettencourt – So you provided an exemption, but a rate increase will offset some of this
    • Small percentage
  • Bettencourt – DO you know what the average increase for College Station is?
    • Don’t have that info
  • Bettencourt – Giving me a conflicting message; providing an exemption, but raising the rate
    • My job is to try and have constituents understand our tax rate process
  • Bettencourt – Would love to see the truth in taxation calculations, because new growth is exempted & essentially free

 

Amy Hedtke, Texans for Freedom

  • Even with high transparency and regular elections, Cities like Arlington can see 5% turnout
  • Bettencourt – Do you know what date that was?
    • I believe it was a May election
  • Voter engagement is an education issue, not a transparency issue; see higher turnout with voter education about issues; further, better education through the school systems leads to higher engagement
  • Lucio – What do you attribute low voter turnout where you live?
    • Would say education
  • Lucio – Asks for clarification, are those with low education or high education voting?
    • Not just whether they are educated or not, matter of what they are taught
  • Lucio – Needs to be a central reason, is it too far for them to go vote, is it time; what keeps them from the ballot box?
    • School districts are teaching all priorities aside civic engagement
  • Lucio – Students in classrooms across the state vote for school office, doesn’t this carry on after school?
    • Obvious answer is no, does not reflect what occurs after this
  • Lucio – You’re teaching them to participate
    • In a very closed environment though
  • Lucio – Suggests that we have a system to be able to vote through technology, could use one-time use codes
    • Cannot speak to this method
  • Lucio – Would you be in favor of providing a method by which people can vote from their homes?
    • Would need to look at the particular system
  • Lucio and Hedtke discuss voting trends, Lucio contests that there is outreach during election now and we have low voter turnout still
  • Lucio – If the methods we have tried haven’t worked, then it’s time to try something new
    • This is back to the foundation of education
  • Hedtke recommends a state database of upcoming elections, ultimately people need repeal of taxes
  • Bettencourt – Do you agree November elections lead to better turnout?
    • I don’t think it matters when you have elections

 

Shannah Hayley, City of Plano

  • Plano conducts surveys, combines survey feedback with analytics of voting trends & changes approach given targeted populations
  • Plano provides regular videos, Facebook outreach efforts, etc.
  • Outreach efforts are typically constrained by budget season; to overcome challenges, Plano has created a plain-language guide to government finance and budget, publish topic videos on rates and exemptions, and townhall meetings
  • Surveys show majority are satisfied with Plano outreach
  • Bettencourt – I think last time we looked at Plano’s number they were in the 20% range, you obviously have been moving rate down a bit as values have risen; why have you gotten 71% satisfaction?
    • Added questions about value to resident survey
  • Hancock – Am I wrong that Plano adopted a population/inflation number for the revenues?
    • Yes, we did
  • Lucio – Refers back to Hedtke’s testimony, agrees with her proposal on education as a necessity
    • Hedtke – Notes that low turnout is just among the registered voters
  • Lucio – Goes back to parental involvement, reiterates point that state needs a system to allow people to vote wherever they are

 

Chrissie Kolb, City of Balcones Heights

  • Gives an overview of Balcones Heights and outreach; some city council members insist on printed notices
  • Do not have many residents registered for email outreach, most effective method is newsletter outreach
  • City posts budgeting info to city webpage, has low number of followers on Facebook page
  • Bettencourt – You do have a very high over-65 population, what would you recommend for this population? There is a problem with accessibility for things like virtual town halls
    • Have moved forward in terms of digital and social media in the last 5 years, have many apartment residents that are not very involved in city operations
  • Bettencourt – Renters are also seeing a severe impact
    • Absolutely, our Mayor has been trying to reach out those in apartments, many are not interested
  • Bettencourt – Goes back to College Station regarding the homestead exemption and the tax rate increases; “very disappointed” in what his staff research has seen, College Station has increased tax levy by 45.5% from 2013-2017, 5% homestead exemption does not matter compared to this large of an increase
  • Bettencourt – If you’re going to communicate a strategy, then you should communicate the truth about tax rates; this is why we need truth in taxation

 

Talmadge Heflin, Texas Public Policy Foundation

  • Shares his experience with requesting ballot from county; after request, receives mail-in ballot for every election
  • TPPF believes 1 time a year in November is appropriate, should also make financial impact very clear to the voter through simple language
  • Revenue and budget information should be posted to websites
  • Perry – Agrees that simplification is the key; higher tax rates are often a result of cost of living increases/inflationary increases, most cities and councils don’t arbitrarily pick higher tax rates
  • Perry – Large component of the driver is personnel, and there is an expectation for an automatic raise every year
  • Perry discusses how many constituents are not able to afford or cannot access technology connections
    • Governmental entities need to get in the habit of providing information in an easily accessible and identified fashion
  • TPPF position is that cities should be allowed to grow budgets by population + inflation, hopes that this will continue next session
  • Bettencourt – Sen. Hancock will be refiling his legislation & it will pass the Senate once again
  • Lucio – Need to engage and make sure that technology, such as internet access, is available
  • Bettencourt – One possibility is for a real-time property tax notice at a state agency and let local governments tie into this
    • Hayley – Happy to take this back to city management
    • Hedtke – Have to be careful you don’t make this your only solution, because it is not
    • Heflin – Not the answer for today, but can be the answer as we grow
  • Bettencourt – November is the key in my mind

 

Dale Craymer, Texas Taxpayers and Research Association

  • There are some common questions such as how much is your bill, to which jurisdictions do you pay, how much to each, etc.; basic questions, but difficult to get answers in the current system
  • Goes over issues with the appraisal notice, numbers are estimate and often wrong, tax rates presented are out of date, etc.
  • Presents model for an SB 1 proposal for a notice based on final taxable value, lays out the rate at the effective tax rate, also presents rate increase proposals to help identify which jurisdiction is increasing; has linking information for rate and governance information
  • Bettencourt – Very good model to look at
  • TTARA recommendations: first appraisal notice should be replaced with real-time web-based notice detailing differing jurisdictional impact, taxing units should be required to provide info webpage, & standardized format for data
  • Bettencourt – Some of these ideas have already been in legislation, expect they will show up again

 

Sarah Bustilloz, City of Roundrock

  • Round Rock budget is slightly different in that sales taxes are large part of city revenue
  • Most Round Rock residents cite digital communications are the most used method to receive tax info, only 1 citizen has referenced newspapers as the primary method of notice
  • Bettencourt asks Bustilloz to reiterate the newspaper point
  • City of Round Rock also operates Facebook posts with high levels of engagement, also have an online calculator to show residents the impact of proposed rates with jurisdictional breakdown
  • This year, largest recipient of tax revenue is school district at 56%
  • Bettencourt – I’m intrigued by your online calculator, did you do this yourselves?
    • Done in house at the Round Rock IT department
    • Will do calculate for the majority of different jurisdictions

 

Public Testimony on Voter Engagement Charge

Carol Spencer, Bastrop County Resident

  • Government financial data should be posted online in its original format and also in a plain language format
  • Should have feedback processes instead of open records requests
  • Should reach out to national organizations
  • Bettencourt – Asks for contact info

 

Jeff Coyle, City of San Antonio

  • San Antonio has embraced shift from traditional notice to digital, spent half of newspaper budget on new Facebook postings, Google ads, community pages
  • San Antonio is trying to meet the constituents where they are, have volunteers running surveys at public events for opinions on spending patterns
  • Largely responses indicated desire for more infrastructure spending & less spending for public safety, info is presented to the city council
  • Discussion needs to be about benefits provided in addition to the cost
  • Bettencourt – Total tax levy has risen ~30% over 2013-2017, what are your taxpayers telling you now, would assume they want tax relief as an offset to higher revenue collections with same rate
    • I think the average person would say they do not like their property taxes
    • Looking at this from a 10-year perspective, roughly a 4% increase in revenue
    • 45% of our residential base is getting a senior or homestead exemption
  • Bettencourt – So you have a senior freeze and a regular homestead exemption
    • We have a senior exemption and freeze, we do not have a regular exemption
  • Would like to see two things this session: public school reform & more flexibility at the local level to target exemptions
  • Hancock – When you lowered the rate, how many times did you still have a lower than 8%
    • Can provide this to your office, this year I believe it is 6.6%
  • Hancock – just curious on when reductions were to go below rollback rate so you wouldn’t have to go before the voters
    • Right, I understand the question
  • Bettencourt – The city has the authority to bring rate down, legislature can only affect the rollback rate
  • Bettencourt – Part of the issue is we need relief for everyone, can’t target relief
  • Bettencourt – You have had revenue growth and rate increases, would think that your population cannot easily absorb this
    • We did have this conversation recently, balanced by the demands for city services
  • Bettencourt – Strongly suggests you take this back to the city council and pursue a rate reduction

 

Lynette Lucas, San Angelo Resident

  • Shares experience finding out about an unpublicized school bond election; many in San Angelo are not on the internet & can be hard to access information
  • Agrees that voting should be in one November election
  • Bettencourt – Was that this Summer? Did it fail?
    • It was this Spring, failed by 2 votes

 

Joe Palmer, Fort Worth

  • Survey questions might get different responses with differently worded questions focused on taxing impact
  • Republican convention decided on November elections as part of the platform
  • Bettencourt – We have parties coming to speak later, but this charge is on communication and engagement
    • Most people interact with assessor-collector once per year, many not engaged in election process and could distribute more detailed material
  • Lucio – What would you like to see aside from moving election to November?
    • To increase participation I would like to see more turnout, November election provides that
  • Lucio – Do you vote early or on election day?
    • I vote early
  • Lucio – You take it upon yourself to make sure you don’t miss your opportunity to vote
  • Lucio – I think it personal responsibility and a will to participate, but more access and ability would increase turnout; our job to find more ways to allow public to have opportunity to vote
  • Bettencourt – Republican party also held referendums, SB 2 received 94% support

 

Evaluate whether existing libraries of property tax data and collection methods are adequate for studying local property tax outcomes and identifying drivers of growing property tax levies.

  • Bettencourt presents example of property tax data received from Comptroller’s Office
  • Presents info on forecast of increasing tax levies according to differing rate increase basis
  • Bettencourt – Has seen some info regarding education spending, state spending has remained around 50%
  • Bettencourt – I think we need to wean off of recapture because of its impact on taxpayers

 

Korry Castillo, Comptroller’ Office

  • Gives overview of Comptroller data on property taxes
    • Property Value Study – Snapshot of appraisal
    • Shot-forms detailing special district taxation, abatements, etc.; manually entered and kept on Excel
  • Bettencourt – And you have to spend a large amount of time on error checking?
    • Yes, receive a large amount of school district
  • Bettencourt – Do you spend time doing validation on cities, counties, and special districts?
    • We do validate cities and counties, no manpower or authority for special district
  • Most common error we see is data being entered into the wrong field or previous year’s info; gives overview of validation process for data received
  • Submission are rejected when they affect 2% of value in the file
  • Scholl district values are certified to TEA, distribute info through a variety of methods
  • Bettencourt – And this is the biennial report?
    • No, data is published to website
  • Comptroller also creates large spreadsheets of appraisal district data, school district self-reports are available beginning in January, city and county self-reports come out in the Summer
  • Comptroller doesn’t maintain value for Special districts, data system was outdated
  • Bettencourt – This outdated system was old mainframes, etc.?
    • Yes, updating right now
  • Bettencourt – Important as we are looking at over 100% increase in levies over the next few years
  • Comptroller also posts school districts tax rates in March, city, county, and special district rates typically posted in July, data retained for 5 years
  • V Taylor – So the material says total market value is about $8 trillion, I think this is about $2.5 trillion?
    • Correct
  • Comptroller also publishes tax rate comparison data, searchable through different metrics
  • Also exploring visualizations for other data like appraisal review board data
  • Bettencourt – A lot of counties have aggregate tax units now, are we to the point where we can look at aggregate load through your software?
    • Not sure, will need to look into this
  • Bettencourt – How old is the system you are updating from?
    • Unsure
  • Van Taylor – So TX collects just under $52 billion in total property taxes?
    • Will need to get you numbers to confirm
  • Bettencourt – Your new IT portal is projecting, so want to make sure data is correct

 

Dale Craymer, Texas Taxpayers and Research Association

  • Found several issues with the Comptroller data, i.e. the tax collection is $60 billion, special district data is particularly problematic
  • Recommends additional funding for Comptroller to verify special district data, through notes Comptroller is not required to collect this
  • Bettencourt – Important to get correct info as special districts are the fastest-growing tax source
  • Bettencourt – And have you discussed this with the Comptroller’s Office?
    • Have discussed these issues
  • V Taylor – You’re saying that total property tax collection was $60 billion?
    • This was the levy
  • V Taylor – And this is why you were hedging on the $52 billion number?
    • Castillo – This is the historical number
  • V Taylor – So it was $52 billion and what is $60 billion, staggering increase in taxes
  • V Taylor – How much of the $60 billion is school tax and what is everything else?
    • Craymer – We’re looking at roughly 45% is school taxes

 

Marya Crigler, Travis Central Appraisal District

  • Providing overview of appraisal district actions
  • Have seen a dramatic increase in protests in the county, had a 3rd party look into this
  • Found that 75% were protesting tax rate rather than value, found a lack of understanding by taxpayers of role of those involved in tax rate setting
  • Bettencourt – When did you do this?
    • Did this in 2017
  • Tried to educate taxpayers on the tax system as a whole and the role of the different parties involved in rate setting
  • Ran a townhall series this year, created a web tool to allow owners to search taxable value & provides tax rate info, have tried to include date of rate hearings, elections, etc.
  • Bettencourt – How many districts do you have?
    • 131
  • Bettencourt – How much do they collect out of the districts
    • Some split with Williamson, roughly 120
  • Bettencourt – One of the things we want to explore is a centralized taxing office, want to have this sort of system spread as far as possible
  • Would like to have some help in getting more information to fill out our database
  • Bettencourt – This is the type of software system that would be a big improvement on the current system
  • Bettencourt – How much would the licensing be for portions you cannot control?
    • Roughly $2,000 to $3,000
  • V Taylor – Of the special purpose districts, my understanding is that 80% is community colleges and hospital districts?
    • Craymer – Correct, if you’re in a MUD or similar, then the bulk is likely that
  • Bettencourt – Beyond the city and school districts, the rest is special districts; almost 1,700 special districts at this time
  • Bettencourt – Any solution coming out of this committee is going to have special districts, period
  • Bettencourt – How long did this take you to do and what did you spend?
    • All told, we also developed a portal to self-report info
  • Bettencourt – What about error checking?
    • It prepopulates with data from appraisal district and they can correct
    • All told, we’ve spent roughly $45k
  • Bettencourt – Excited about this; we need system

 

Gary Earnest, Taylor County Appraisal District

  • Have a tool that allows taxpayers to populate their value and then it calculates various tax rates and total tax; not as advanced as the Travis County tool
  • Also started an email initiative attempting to collect contact emails from taxpayers
  • Also participate in the Comptroller data collection, also try and complete all the short forms for the different entities
  • Support all best practices, very much in favor of developing something prior to setting the property tax rate rather than after

 

Public Testimony on Data Management Charge

Lynette Lucas, San Angelo Resident

  • Taxes rising
  • Being told when they are going to protest look for satellite images
  • Found out they were being taxed for a carport that was a neighbor’s shed, so hearing of inaccuracies with satellite

 

Evaluate the operations of appraisal review boards (ARBs), specifically the training and expertise of members concerning appraisal standards and law, ethics, and meeting procedures.

Ken Nolan, Dallas Chief Appraiser

  • Over 138k protest, 77l hearings within 55 day
  • Experiencing overutilize, have been told this process is so easy they are coming back next year and bringing all their neighbors
  • Extra two weeks were invaluable this year so if moving certification back then request to move back appraisal
  • Said front end of calendar was shifted back two weeks but certification was left at July 25
    • Bettencourt – how much of that 2 weeks is absolutely necessary?
    • At least a week
  • Getting tax rates off appraisal notice would help people understand the process
  • Electronic processes increased would also be helpful for legislature to provide
  • Tax consultants tend to file protest on all of their clients, they may withdraw at the last minute, but they still have to prepare – would like to see some relief from this practice
  • Bettencourt – how many topline counties?
    • Of the big 5 – 4 of the 5 are doing it
  • Don’t want familiarity to exist and done want pubic to think ARB as employees, as far as training what type of people does legislature want to
  • Bettencourt – would it help if jury were paid by state instead of local
    • Absolutely
  • Bettencourt – puts up slide to show the disparity of appraisals review board sizes
  • Bettencourt – says most people want an ARB that listens
    • Agrees, average ARB is retired citizens
  • Bettencourt – What is the average age?
    • About 70 or higher
  • Bettencourt – anyone terminated from ARB?
    • No terminations but some have not been re-appointed
  • Trainings need to include things like how to conduct a meeting, customer service
  • Bettencourt – talks about Lubbock taxpayer who felt like ARB and Chief Appraiser colluded in from of him
  • Thinks system can be fixed and saved, website is a good idea and the more similar the better
  • Bettencourt – notes his shop has been model of best practices
  • Bettencourt – asked about resources
    • Could be regionalization, could consolidate some districts but keep in mind the property owner who has to drive in to the hearing

 

Jason Cunningham, Harris County Chief Appraiser

  • In favor of top line but ARB is not
  • Bettencourt – next hearing he is going to insist that ARB attend
  • Bettencourt – top line allows for someone to accept the value without going through a laborious hearing process but leaves open for judicial appeal
  • Bettencourt – Discussed lawsuit concern of when ARB members not assigned to panels would say they were unemployed and filed for unemployment
  • Bettencourt – in response to Dallas supplying 1099, does Harris county do that?
    • Does not know, will check
    • Confirms they do a W2 for their ARB
  • Resolve cases online – between 18k-43k cases
  • Bettencourt – Notes that is positive
  • Do everything they can to respect line between ARB and appraisal entities
  • Couple of suggestions
    • Training required – no specification on how many actual hours they have to get and recommends customer service training
    • Trainers being allowed to represent clients – concern on conflict of interest
  • Bettencourt – asked ARB chairs to come, they didn’t so he will insist they come next time or he will write a bill without them
  • Bettencourt – important to have one and only one deadline
  • Bettencourt – equity, E&U report, got people that will swear that all equity is sent to the board and they refuse to make a change
    • Both witnesses said that does not happen
    • Do listen to equity/market claims informally but confusion as to what equity means
    • Does not think they will have a lot of equity problems in Harris
    • Bettencourt – said he has a CPA friend that he will send his way, concern on evidence ARB has
    • This year is a good example of where you could find equity issue since they kept values from last year
  • Bettencourt – need an ARB that listens to evidence
    • Nolan – No one can agree on equity like what comps, how to pick them, and how many, probably only state where equity value does not relate to true market value of property
  • Bettencourt – understands equity is a hot button issue but there are good methodologies
    • Nolan – need to agree on way to arrive at E&U conclusion
  • Issue with equity is they make sure it is equitable in the first place but notes there are no across the board standards
  • Bettencourt – will talk about the training that is important, and keeping them separate, will work on a package of best practices

 

Steven Dunson, Property Tax Consultant

  • Gave overview of his experience in field
  • ARB reform – situation can be improved
  • Recommends more comprehensive training and need to pass an exam
  • After they pass the exam they should be license by TDLR
  • Restoration of property tax board – governing body who heard complaints of ARB board, need oversight of ARB
  • Gave stories of abuses going on in ARB that he has witnesses, he argues they are rare but there is a desire and need to reestablish a property tax review board and ARB should be licensed
  • Bettencourt – lower license since it is more of a short course on value or equity
    • Need a way to get to ARB and get them removed
    • Maybe a licensure requirement on the ARB chairman

 

Marya Crigler, Travis Central Appraisal District

  • I think the one thing I see that is putting pressure on all parties involved in the ARB process is the increased volume and time constraints
  • 146k protests this, 20k up from last, have seen a 10% increase in volume year by year, puts pressure on all parties
  • Bettencourt – Do you know how much topline helps you?
    • Had 17k topline, tend to be more for the commercial, about $62 billion in value
    • This is one of the things we discussed with Bexar CAD & they started this in 2018
  • Trying to be more efficient, but taxpayers sometimes feel they are not getting the attention that they want
  • Bettencourt – You haven’t seen legal ramifications that the 4 major districts are doing compared to Harris County
  • Bettencourt – What recommendations do you have?
    • Having the ARB paid by someone else than the appraisal district would create that feeling of separation; we did this this past year due to needing to relocate
  • Bettencourt – And you had one location?
    • WE had one location, Travis County Expo Center
    • ARB was much more efficient at the Expo Center
  • Bettencourt – Because?
    • Probably somewhat due to the format, bathrooms and other facilities weren’t quite as nice; they could see those waiting
    • Was incredibly complicated for the appraisal district to do this, provided all the coordination for the ARB
  • Bettencourt – Asks after the district being involved in policy decisions of the ARB
    • We execute policies and directives as dictated by the ARB Chair
  • Bettencourt – and how much faster did they move?
    • 38 per day
  • Bettencourt – Sounds like you will have ever increasing business
  • Bettencourt – Are the number of parcels increasing in Travis County?
    • Yes, 361k in 2005 to 439k 2018, went from 13% to 32% protests during the same time period
  • Most of the protests are about affordability of taxes
  • Could also look at moving appraisal studies and map reviews from biennial schedule to three year schedule and incorporate an ARB review
  • Bettencourt – Logical suggestion, would fit the three year cycle we are supposed to be on

 

Roger Williams, self

  • Crucial function of a hearing is to have someone listen
  • Bettencourt – you’re not saying someone slipped back, as in we had some cutting land with 3-0 votes?
    • No, but we need to tear down that altar in Travis County
  • Recommends more training and thinks licensing is a good idea, but agrees there should not be a high threshold
  • Concern on attitude of hearings and intros before ARB meeting sound close to passing the buck
  • Regarding E&U sees different CADs treating application different
  • Bettencourt – asked about concerns with the Murphy bill
    • When removing taxpayer opportunity to respond to any aspect of the taxpayer notice, it is an injustice
  • Bettencourt – will try to address this issue in a clean-up bill

 

Talmadge Heflin, Texas Public Policy Foundation

  • Did not bring any reform ideas for this issue today
  • But will be prepared to offer suggestions for appraisal reform next time

 

Public Testimony on ARB Charge

John Spinolo, Small Business Owner from Williamson County

  • Assumed value under income method is unfair for businesses and not close to what property
  • Texas business already taxed on their income under the franchise tax
  • Urge body to amend property tax code to make at least chief appraiser elected so they have a voice in the process
  • Perry – improper technique to be doing value on

 

Joe Palmer, Fort Worth

  • Reviewed personal story of appraisal review process
  • Suggestions are:
    • Statute should be switched so they can go second and owner first
    • Need to elect people deciding the appraisals
    • A less expensive way to protest
    • Elected officials who are impacted by taxes should not sit on ARB
    • Statute allows for adjustment of sale prices – if state allows for artificial manipulation of sales prices it needs to be stopped
  • Suggests a consumption tax, eliminate property tax
  • Bettencourt – we are not discussing this issue today

 

“Kathleen,” Bastrop Resident

  • Seen value of house raise by $30k, if cannot get relief will need to move somewhere else
  • Bettencourt – confirms she lives in Bastrop
  • Bettencourt – asked about percentages of bill, confusion/clarification requested
    • School taxes are about half and have not even paid off their bonds and children still in portable classrooms
  • Concern is who are people doing appraisal, are they educated or unionized
  • Hopes for licensing and education for ARB

 

Mark Ramsey, Republican Party 

  • 13 separate planks dealing with property taxes and appraisals
  • Bettencourt – is there a plank that says only elections in November?
    • Not in this 13 but they do have that
  • Highlights some planks
    • 163 – public should be able to go to JP court instead of district court
    • 184 – ARB should be elected boards
    • Only 5 legislative priorities’ and over 100 platform planks
  • Legislative Priority – eliminating ARB and taxing property at purchased value or free market value
  • Heart of problem is when elections are held – should be in November and require 20% turnout before bond indebtedness could be put on citizenry, etc
  • Bettencourt – do we have a spring election or not?
  • Bettencourt – shows turnout numbers by county
    • Ramsey – Preference for November election for bond or taxes
  • Bettencourt – asked if Ramsey had any recommendations about ARBs?
    • Should be elected
    • Legislative Priority said get rid of appraisal entirely

 

Amy Hedtke, Texans for Freedom

  • Reads testimony from witness who could not attend, lower homestead cap and thinks board should appoint Chief Appraiser so it will not be a political position
  • She thinks it is already a political position, whole idea of property tax needs to be eliminated not reform

 

Summer Wise, Republican Committee Woman from SD 24

  • Urges committee to think about maybe there is a better way to get the revenue that consumes fewer resources in the process
  • Bettencourt – asked if she had any ARB reform suggestions
    • Defers to earlier testified Republican planks and Legislative Priorities