A Property Tax Battle is Brewing


The year 2020 feels like being in a war and now an unexpected battle is brewing in the property tax arena.  Thus far, it has been a war against an unseen virus, a falling economy, and record unemployment.  

At a time when one in eight Texans are unemployed, and businesses are closing right and left, we now are faced with fighting rising property taxes.  

The Process

There are two components involved in property taxes in Texas – assessed values and property tax rates.  Property owners can appeal their assessed values with their respective Appraisal Districts. However, local taxing authorities set the property tax rates.

New Law

During the 86th legislature, Governor Gregg Abbott signed into law SB2 designed to slow the growth of Texans’ property tax bills. SB2 limits local governments to a 3.5% increase in revenue without going to a vote by the public.

According to an article published on May 21, 2020, by The Texan, when Gov. Abbott initiated a statewide disaster declaration it triggered a loophole in the bill. In the event of a disaster declaration, it would allow taxing entities to increase tax rates to the 8% threshold without voter approval. This only applies to cities and counties.

The law intended this as a measure to help communities hurt by natural disasters causing physical property damage. Republican leaders in the state are opposed to tax rate hikes at this time and say the disaster related to the Corona Virus does not apply to the loophole.

While city budgets are strained due to the pandemic, this does not mean that all municipalities will move to raise rates to the 8% level. The City of Dallas was exploring the option of increasing rates to that level to help alleviate an already strained budget. However, in a May 27th vote by the Dallas City Council elected in an 11-3 count to require voter approval to increase the tax rate beyond the 3.5% cap.

Council members told Obed Manuel, a reporter for the Dallas Morning News that this simply wasn’t the time to consider raising taxes.

The Battle

2020 property tax appeal
Photo courtesy of Le Duc Tung

The brewing property tax battle will now be fought at the appraisal districts. How that will look remains to be seen. The protest deadline is different with almost every appraisal district. This contrasts with previous years when a statewide protest deadline applied.

In a typical year, the protest process involves face-to-face meetings between appraisal district employees and either the property owner or their assigned agent. This year, it appears that most meetings will be held virtually. Video conferencing will be utilized and evidence will be submitted electronically.

Kurz Group team members are hard at work preparing arguments and keeping up with the various appraisal district schedules in order to best represent our clients. If you would like more information on protesting your commercial property tax values, please contact us.

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