By Jim Collier
The Denton County Appraisal District (Denton CAD), will be mailing the 2012 real estate property tax appraisals around the first week in May. If the past few years’ trend toward erroneously inflated home values continues, Denton County homeowners will be billed for excessive taxes.
This over-valuation is our county government’s way to generate more tax revenue without using the dreaded words “tax increase”. Our homes are given values well above the actual market values.
According to the nationally accredited authorities, S&P/Case-Schiller, property values have actually declined every year since 2007. Yet our county property appraisals have consistently increased.
During an Arbitration Review Board held last summer the question was asked, “How, with the entire country suffering from declining home prices, can Denton County be so different?” After some hemming and hawing (and even a couple of blushes) one of them mumbled “We’re in a bubble of prosperity.” During interviews with more than 20 homeowners attempting to have their appraisals corrected, that response was often repeated.
Fortunately our Legislature has put processes into law to protect homeowners from this chronic victimization. Unfortunately though, only about 3% of homeowners use those processes. That 3% has had consistent success in having their appraisals lowered. The amounts vary, from as little as 1% to as much as 15%. This amounts to lowering your tax bill by anywhere from $50 to $2000 dollars.
Last year the residents of Frisco Lakes, a gated retirement community in far eastern Denton County, formed an association to fight their appraisals. According to a story in the Dallas Morning News, reductions in appraised values ranged from $9,000 to $109,776. The average reduction was $37,266.
The Frisco Lakes Residents’ Appraisal Support Group has file a grievance against DentonCAD with the State Licensing Board.
If a homeowner wishes to appeal the appraisal, there are instructions near the bottom of the Notice of Appraised Value that you will receive from the Appraisal district. An optional, but highly-recommended first step is an informal review with the appraisal district, with a reduced wait time. An important thing to remember is, call as close to 8:00 AM (not before) to have a good choice of meeting times. The meeting will be conducted on the day the call is made. During the informal meeting the homeowner will sit down with a Denton CAD appraiser to review the appraisal and bring up the objections to the appraisal. Surprisingly, this method sometime arrives at a reasonable solution. Most likely though, no satisfactory resolution is reached.
The next step is submitting the Property Tax – Notice of Protest form. This form will be included in the envelope with your appraisal. It is recommended this form be submitted personally. Mailing is allowed but there have been protests “lost in the mail”. Once submitted, the homeowner will be notified, by mail, of the date and time for the Arbitration Review Board (ARB) meeting. In approximately 90% of the cases, this ARB is not settled in the homeowners favor.
If the ARB result is unsatisfactory, the mechanism put into law by the Texas Legislature dictates the next step. With the written result of the ARB a Request for Binding Arbitration form will be included. This form must be filled out and submitted to Denton CAD with a cashiers check or money order for $500.00. If the homeowner is successful the in binding arbitration hearing the State Comptroller’s office will refund $450.00 ($50.00 is kept to cover administrative costs.).
There are numerous recommendations to follow to obtain a favorable hearing result. If this stage is reached resources can be found and used to obtain that favorable result. The most convincing evidence is the value of homes in the homeowner’s neighborhood sold in the last two years, as determined by comparable sales or “comps”. At least 3 comps should be provided. The condition of the homeowner’s property is another important factor; wall cracks, foundation issues and general state of repair should be supported with photographs, and repair estimates. Another factor influencing the arbitrator’s judgment is the condition of other homes in the neighborhood, such as those that are eyesores or abandoned.
Read the appraisal carefully, note the dates the appeals are to be filed, and seek and accept assistance from other homeowners who have been through the process.
Jim Collier is a retired telecommunications engineer from Lewisville. He is not a lawyer, and does not accept compensation for his advice, but he has successfully helped others through the process of protesting their valuations. He can be reached by email at firstname.lastname@example.org.