As the Tarrant Appraisal District sends out its property appraisal notices the first week of April, taxpayers can expect to again see substantial increases in their values. But problems that plagued district operations for the past few years have been largely resolved, say officials.
The district had struggled with accuracy and timeliness problems due to its rollout of the Aumentum software in 2014. TAD officials have been implementing improvements recommended in an independent audit of the computer software that was released at the end of last year.
“We’ve made a lot of good progress with our new software and expect the 2017 appraisal year to be a better year than the past two,” TAD Chief Appraiser Jeff Law said in an email.
The computer problems nearly caused school districts in Tarrant County to lose some state aid because of undervaluation of property in 2015.
Many taxpayers saw average property value increases of 14 percent last year as TAD officials tried to correct the 2015 under-valuations and the robust real estate market pushed market values further upward. The result was a record of 103,000 protests last year.
Software problems also promoted an emergency allocation of $7 million by Tarrant County Commissioners to temporarily cover refunds due taxpayers that the data system failed to detect.
Outsiders who work hand-in-hand with the appraisal district agree that TAD officials are doing their best to correct the problems identified by the audit conducted by the accounting firm of Weaver and Tidwell.
“We expect it to go much smoother this year,” said Tarrant County Tax Assessor-Collector Ron Wright, a critic of the software conversion whose office was impacted by the TAD operating problems. “We’re seeing much cleaner data now.
“We’re not out of the woods; we still have a lot of work to do,” Wright said. “But we don’t expect to have the problems we had last year.”
Property tax consultant Stephen Dunson, owner and president of Integra Tax in Fort Worth, said he, too, is pleased with the progress he has seen to correct the problems at TAD.
“We fully expect the appraisal district operations to be much better this year for the people who there and for consultants involved in protests,” Dunson said. “We know they have been working very, very hard to fix the problems.”
The first batch residential appraisal notices will be mailed out April 1 and most others will be mailed by May 1. Commercial property owners should receive their notices by May 1. However, some notices could be delayed until June or July, Law said.
The deadline to file a protest is May 31 for anyone who receives a notice by May 1.
Law said he anticipates value increases for residential, commercial, apartments and warehouses and office properties this year. Retail and shopping centers may remain flat and hotels may rise slightly, Law said.
“The real estate market remains strong in North Texas,” Law said in an email. “As of Jan. 1, our research indicates supply of residential properties for sale has still not met demand. We see all segments of residential property values going up but we are seeing more of an increase in the lower-priced homes.”
Law did not provide the Fort Worth Business Press the amount of the anticipated value increase this year. But Wright, a non-voting member of the TAD Board of Directors said Law has reported to the board that increases could be as much as 5 percent.
The increases triggered by the real estate market price gains will trigger another “heavy protest season,” Law said.
“Anytime we property values increase, as they have the past two years, we expect property owners to file protests,” Law said. “However, I do not anticipate as many protests this year as we had last year.”
As the appraisal process kicks off again, the Texas Legislature is debating legislation that is being billed as taxpayer protection against continuing rising property taxes.
Senate Bill 2 has already been passed by the Texas Senate. Sponsored by state Sen. Paul Bettencourt, R-Houston, and endorsed by Lt. Gov. Dan Patrick, the bill lowers the rollback rate from 8 percent to 5 percent.
The legislation would trigger an automatic rollback election if cities and counties wish to increase taxes to pay for operations by more than 5 percent. Supporters say it will thwart the rise of property tax increases arising from reappraisals even though tax rates remain flat.
A companion bill is pending in the state house with a rollback rate of 4 percent.
Cities and counties across Texas strongly opposed to the legislation, claiming it erodes local control and curtails their ability to raise the revenue they need for fire and police protections, parks, roads and other services.
Critics said the real problem is school district property taxation and their exemption from the legislation.
Although the city of Fort Worth lowered its tax rate 2 cents last year, Mayor Betsy Price testified at Senate hearings about the bill’s harm to local governments.
“I am a huge proponent for property tax relief,” she said in an email to the Business Press. “But as it is written now, SB 2 would not only accomplish that but it could hinder local government’s ability to govern, provide adequate public safety and the flexibility needed to deliver the excellent city services our citizens need. The true way to relieve the property tax burden would be reform school finance, which is not being considered.”
The Texas Municipal League, an advocacy group for Texas cities, has similarly called for changes to the state’s reliance on property taxes to pay for schools.
“City taxes are not the cause of high property taxes,” Bennett Sandlin, executive director the Texas Municipal League, said in a statement. “The only way to provide real tax relief is for the state to adequately fund its share of public education to reduce school property taxes.”
As tax-assessor collector, Wright said he supports the legislation out of responsibility to “tell the truth and put accountability where it belongs. Appraisal districts appraise property; nothing they do drives taxes,” he said. “Local governments raise taxes.
Wright said the pending legislation is a “barrier not a revenue cap.” Entities can hold rollback elections so voters can decide whether they want to raise taxes above 5 percent.