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2014: What Has Changed Regarding Property Tax Law

Property tax law in Texas is one of the most contentious current issues in the state. Indeed, this is particularly true considering that, in 2014, Harris County saw an average increase of 17% on property appraisals within its jurisdiction. Of course, most of that can be attributed to increased economic activity—not any new property tax laws on the books. That being said, there are a few new property tax laws that went into effect in 2014 that affect Houstonians and Texans.

New ARB Regulations

The Appraisal Review Board (ARB) in your county is responsible for holding hearings and making judgments in regard to appraisals made by the County Appraisal District (CAD). In 2013, legislation was passed to improve ARB procedures. That legislation went into effect on January 1, 2014. One of the most important new regulations is the requirement of a state-mandated course for members of the ARB. Prior to this, members of the ARB did not need to have any training to be on the board. The state comptroller is also now in charge of providing model hearing procedures to all ARBs throughout the state.

Additionally, a prospective ARB member who was an appraiser anytime within the previous 5 years can no longer be appointed to the ARB as a way to avoid favoritism. ARB members in counties with under 120,000 people will also now be appointed by a local district judge instead of the CAD.

The State Office of Administrative Hearings

New legislation also established the permanence of the State Office of Administrative Hearings (SOAH). The SOAH had been established earlier, but only as a pilot program. This effectively allows property owners to engage in an alternative appeals process if they are not pleased with the ARB’s rulings. The SOAH operates offices out of 14 large municipalities including Houston, Fort Worth, San Antonio, Amarillo, and El Paso. The administrative law judge sets the hearings for each municipality.

Closed ARB Hearings

Before 2014, certain ARBs had an informal process wherein they could call for a closed hearing for certain issues. New legislation that went into effect in 2014 gives the ARBs a formal process for doing that. If the property owner and chief appraiser both want to have a closed hearing, then the ARB must comply. Most property owners will want a closed hearing if any confidential information about them or their property is disclosed.

Solar Energy Provisions

Starting in 2014, any solar energy device on a property must be counted as part of the appraisal. If you have a device that produces solar energy, then your appraisal will now account for that. Of course, this only applies to solar devices that are installed on or after January 1, 2014. Everything installed prior to that will not be subject to appraisal. This is a major piece of legislation as some property owners may forgo the implementation of solar energy devices on their property because of the increased property tax costs.

Binding Arbitration Upgrades

Binding arbitration is another option for property owners who disagree with the ARB’s rulings. In the past, the only valid reason for the implementation of binding arbitration was an excessive appraised value. With the new legislation, the “equal and uniform appraisal principle” has been added as a valid reason for engaging in binding arbitration. If you feel that you have been unfairly singled out or similar properties have valuated at a lower price, then binding arbitration can now be used as an option.

More questions or concerns regarding the 2014 property tax changes that might affect your property taxes? Contact O’Connor & Associates today!

Blog Author

Patrick O’Connor, MAI, Owner and President
Patrick O’Connor has been active in reducing property taxes, providing expert witness testimony and appraising commercial real estate property since 1983. Pat is active in publishing analyses and data with respect to the real estate market, while being a highly regarded media spokesperson for the real estate community. He holds a MAI, the highest achievable designation from the Appraisal Institute, and is a licensed senior property tax consultant. Pat earned a Master of Business Administration from Harvard University. In 2001, he authored the first definitive consumer guide to Texas property taxes, Cut Your Texas Property Taxes.

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