Property appraisal statements are being sent out and many homeowners may be experiencing “sticker shock” on seeing big leaps in their properties’ appraised valuation. But there are ways and means to keep their tax bills from rising as much as their property values.
Texas has become one of America’s hottest real estate markets as people flood into the Lone Star State from California and elsewhere, driving property values in Texas up, up, and away. In Erath County alone, property values are estimated to increase by about 30% (the appraised value of my property went up almost 40%). As chair of the Appraisal Review Board, to which a property owner can go to protest an increase in his property’s appraised valuation, I expect to see many concerned property owners this summer. Much of their concern will be driven by the belief their property taxes will go up too much.
But those who are so concerned should keep in mind a number of facts which may allay, at least to a limited extent, some of their fears:
First, neither the Erath County Appraisal District nor the Appraisal Review Board sets tax rates. The ECAD merely appraises property and submits its estimates to the taxing entities within Erath County—the cities of Stephenville and Dublin, the various ISDs, the Groundwater Conservation District, and the county itself. What the governing boards do with the data—whether they raise, lower, or leave unchanged the tax rates, is up to those whom the citizens have elected to serve on them. The ECAD has no control over them.
While the ECAD can’t limit what the taxing authorities do, the state can. For example, state law prohibits cities from increasing the total revenue they collect from property owners by more than 3.5% over the amount collected the previous year without the approval of the voters in a “rollback election.” Cities may have to actually cut their tax rates to remain within the limit. Under the leadership of Mayors Jergins and Hunter, the Stephenville city council did exactly that.
And for tax purposes the assessed value of a homestead cannot increase by more than 10% from one year to another. Thus, as Dale Claymer, head of the Texas Taxpayers and Research Association explained on Lone Star Politics—the Dallas NBC television affiliate this morning, a 40% increase in the value of one’s homestead means no more than a 10% increase for tax purposes. Check out the interview here: https://www.nbcdfw.com/news/politics/lone-star-politics/lone-star-politics-may-1-2022/2955457/.
Moreover, voters can take affirmative steps to reduce their property taxes. For example, in the upcoming local elections they can vote for those candidates for city council and school board who most credibly claim they can keep taxes down. Moreover, they can vote on several local and state tax-related propositions. In the Stephenville ISD, the voters can choose whether to approve either or both or neither of the bond issues on the ballot. Statewide, voters can choose whether to adopt 2 new constitutional amendments—one to lower property taxes on the elderly and disabled, the other to raise the statewide homestead exemption for ISD tax purposes from $25,000 to $40,000.
And as the governing boards prepare their budgets for the next fiscal year, citizens can, and should, attend whatever meetings and hearings are available to voice their concerns over tax increases. But in doing so they must keep in mind that Texas law requires local governments’ budgets be balanced. If the voters want cuts in taxes, they may need to accept spending cuts as well.
In sum, dramatic increases in appraised property values don’t necessarily lead to equally dramatic increases in property tax rates. Current state law reduces the degree to which tax rates can be raised, and upcoming elections and budget sessions offer even more opportunities for taxpaying property owners to reduce their tax burden, especially if they’re willing to reduce government spending as well. So go at it.
Malcolm L. Cross has lived in Stephenville and taught politics and government at Tarleton since 1987. His political and civic activities include service on the Stephenville City Council (2000-2014) and on the Erath County Republican Executive Committee (1990 to the present). He was Mayor Pro Tem of Stephenville from 2008 to 2014. He is a member of St. Luke’s Episcopal Church and the Stephenville Rotary Club, and does volunteer work for the Boy Scouts of America. Views expressed in this column are his and do not reflect those of The Flash as a whole.