So you got your appraisal notice in the mail? Don’t Panic! There are things you can do to lessen the impact higher appraisals have on your property taxes. Start by arming yourself with the basic facts about property taxes. Hi, I’m Ron Wright, Tax Assessor-Collector of Tarrant County.
Three factors are used to calculate the property taxes you pay: value, exemptions and rates. Appraising the value and granting exemptions is the responsibility of the Tarrant Appraisal District. Tax rates, the primary instrument of taxation, are adopted each year by the local taxing units in which you live.
Almost all property owners in Tarrant County will pay taxes to at least five local taxing units: the county, the county college district (Tarrant County College), the county hospital district (John Peter Smith), a city and a school district. Some residents will also pay taxes to the Tarrant Water District or the Emergency Services District that provides emergency services to residents in unincorporated areas of the county although the exact percentages may change from city to city. The largest consumer of property taxes is always the public schools.
The Tarrant Appraisal District,or TAD, is governed by a board of five voting members appointed by the taxing units in the county. The Tax Assessor-Collector sits on the board as an ex officio or non-voting member. The chief executive officer of the appraisal district in charge of day-to-day operations is the Chief Appraiser. Texas law requires that all property appraisals be fair and uniform and that a roll of all properties with names, addresses, exemptions and values be provided to the taxing units by July 25 of each year.
Tax payers who believe the new appraised value of their property is wrong or unfair have until May 31 to file a protest with the appraisal district. Taxpayers can work directly with TAD staff or a hearing before the Appraisal Review Board, the ARB, will then be scheduled. The ARB consists of approximately 72 citizens of the county who meet in small panels for several months to hear appraisal protests. Many appraisals are adjusted through this process, but it’s just the beginning for taxpayers concerned about ever rising property taxes. The process doesn’t end until tax rates, always the determining factor, are adopted by the taxing units five months later.
The governing bodies of local taxing units (school boards, city councils, etc.) publish their Truth InTaxation information every August. This includes the effective and rollback tax rates. The effective rate is the rate required to produce the same revenue from the same properties taxed in both the current and previous years. It does not include new properties or new construction. As a general rule of thumb, in a growing economy in a growth area like ours, a new adopted rate greater than the effective rate will result in a tax increase. The rollback rate is the rate that would result in an increase sufficient to trigger a rollback election, currently eight percent in the State of Texas.
By the end of the fiscal year, the local taxing units must adopt their operating budgets for the coming year and a tax rate that is projected to produce enough revenue to fund the budget. For the vast majority of taxing units, the fiscal year ends September 30, although some entities in the state have a fiscal year that ends June 30.
The county Tax Assessor-Collector takes the value data from TAD, applies the tax rates adopted by the taxing units and sends out tax statements in October of each year. Although taxpayers have until January 31 of the following calendar year to pay their property taxes without incurring penalty and interest,taxes are due upon receipt of the tax statement.
The property tax system in Texas is designed to ensure that elected officials who are accountable to the people determine how much taxes you pay. Each year the various school boards, city councils, commissioner’s courts and other governing bodies adopt tax rates that will increase revenue, decrease revenue or keep revenue the same as the previous year.
Property values are known in the spring when the appraisal district sends out appraisal notices, but taxpayers don’t know what their taxes will be until five months later when the taxing units adopt their budgets and tax rates. The tax rates adopted by local elected officials always determine the amount of taxes that appear on your tax statement.
Taxes are collected for one purpose only: to fund government operations and the many services we have come to expect from our local governments. There is always a direct correlation between growth in the cost of government and growth in taxes. The widely held notion that property value drives taxes, that if value goes up taxes will automatically go up, is and has always been a myth. Under the Texas Constitution, the only entities that can impose or raise taxes are those to which the state has granted taxing authority. Appraisal districts have no taxing authority. Nothing an appraisal district does raises taxes. Section 25.19 of the Property Tax Code is clear and includes this statement: “Your property tax burden is decided by your locally elected officials, and all inquiries concerning your taxes should be directed to those officials". It’s in the law. Property value, as it relates to property taxes, is inert; it doesn’t drive anything. Government spending drives taxes. Government spending drives tax increases. It is the only thing that does and the only that that ever has.
So, if you don’t like your appraisal, don’t be a screaming goat. Do something about it. Do your homework, prepare your case, and protest your value, or hire someone to do it for you. Just remember, this is only the beginning of the effort to lower your property tax burden. The end comes later when the taxing units adopt spending budgets and tax rates necessary to fund those budgets. That’s when the choices are made by your elected officials that determine how much taxes you’ll pay. Citizens are always encouraged to engage their local elected officials about property taxes and any other concerns they may have that fall under the responsibility of local governments.
I hope this has been helpful. Thanks for watching.