If you were a public official with an operating budget based on property taxes and you oversaw an Appraisal District would you object to making up property values that kept your property tax-based budget afloat?
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Editor's Note: Thanks to an alert reader who sent this link to a helpful site and video from the state comptroller's office on how to present your case at an Appraisal Review Board (ARB) hearing: http://www.window.state.tx.us/taxinfo/proptax/index.html
By Charles O'Dell, Ph.D.
Show me a person in Hays County who believes our property values increased during the past twelve months and I’ll show you an elected official with an operating budget funded by property taxes. There is no reliable information Hays County Central Appraisal District officials can point to that show property values increased throughout Hays County over the past year, but that doesn’t stand in the way of increased valuations.So how can that be? To gain an answer, start with the built-in bias of our property appraisal process.
The Hays Central Appraisal District Board (Hays CAD) is made up of seven directors elected by the governing boards of the taxing entities that participate in the appraisal district.
The County Tax-Assessor/Collector serves as a voting, member of the Hays CAD Board.
Daniel Guerrero —- Chairman —- City of San Marcos
Luanne Caraway —- Vice Chairman —- Hays County
Joe Castillo —- Secretary —- San Marcos Consolidated Independent School District
Dennis Miller —- Hays Consolidated Independent School District
Galen Dodson —- Dripping Springs Independent School District
Abel Tenorio —- Hays Consolidated Independent School District
Dave Williams —- Wimberley Independent School District
If you were a public official with an operating budget based on property taxes and you oversaw an Appraisal District would you object to making up property values that kept your property tax-based budget afloat? I doubt it.
CAD officials will admit that they ignore home foreclosure prices when determining property values, despite numerous studies showing there is a ripple effect on neighborhood property values related to a foreclose. Simply put, the presence of a foreclosed property has a negative impact on the sales price of nearby houses. Moreover, there’s no shortage of foreclosed properties in Hays County. The average during 2008 was approximately 100 per month.
Another imponderable tactic CAD officials used to appraise properties for 2009 was to lower improvement (home) values while raising the land values by a greater amount. The net result – higher property values - and higher taxes. It’s called slight of hand. It’s absurd.
You would expect HCAD to have some information or data to justify such a practice – some information or data that supports the notion that our home values declined while our land values increased. Wrong. HCAD doesn’t have the data. HCAD can’t produce the data. What nonsense!
Need more convincing that our CAD has run amuck?
Consider the strange case of who’s on first
In July 2006, a limited liability corporation (LLC) known as Wimberley Crossroads, LLC was created. The LLC purchased the Wimberley First Baptist Church (WFBC) property in a sweetheart deal for $1.350 million, paying $350,050 in cash and signing a promissory note for one million dollars.
What made this potentially one of the biggest sweetheart deals that Hays County had ever seen was Hays County Commissioner Will Conley’s involvement. Conley’s plan was to have the county purchase the property for $2.4 million and spend $600,000 more in rehabilitation costs. Why? Conley was pushing the church facility as a site for a joint government center to be owned by Hays county and the City of Wimberley.
Remember: The church property was sold to the LLC in 2006. But the LLC-owned property didn’t appear on the tax rolls for two years until June 2008. More specifically, the property didn’t appear on the appraisal tax rolls until - the day before Commissioner Conley convened a public meeting to promote his idea of a government center. Yes, property under serious consideration for purchase with our tax dollars by a County Commissioner who didn’t know the property wasn’t on the appraisal rolls until the day before a public meeting. So much for due diligence on the part of Commissioner Conley.
What’s on second
When the CAD finally appraised the LLC property on the day before the public meeting, its valuation came in at $1,977,720 – an amount less than the $2.4 million price Conley was pushing for taxpayers.
Less than six weeks later, attorney Michael Stevens who represented both seller and buyer in the original transaction protested the appraised value. The LLC was already on the hook for a couple of years of back taxes, and there was apparently a need to get that valued reduced. For you or me, something like that might be a difficult task, but not if you know how to go about it. Reduction requested; reduction made; done. The CAD Chief Appraiser personally lowered the tax value to the sweetheart deal price of $1.35 million.
I don’t know is on third . . .
Now our CAD increased the valuation to $1.94 million. That valuation is $600,000 higher than the $1.35 million, but still lower than the original $1.977 million value that was affixed just before Conley’s public meeting.
Commissioner Conley seems to have backed away from his effort to reward the LLC investors with a quick million dollar profit by county taxpayers – although we are hearing he may soon take another stab at his little scheme before the Wimberley City Council. Our CAD has also made a fairer, although belated appraisal, of the LLC property for tax purposes.
The antics that take place at the CAD should cause all of us to carefully review the preliminary valuation statements when we receive them in the mail. Any property owner who receives an increased appraisal value would be foolish not to protest that increase before June 1, 2009.
11 comments:
who uses cad values when they go to sell their home or commercial property
it might behoove one to look CAD values in one's own neighborhood as well as those surrounding it when selling a home.
my point is that no one goes by cad value to set a sales price and no one resells property at a price lower than what they bought it for. so, what is the point of the article.
“no one resells property at a price lower than what they bought it for.”
Where have you been? Many homes are selling at lower than purchase price right now. Values go up and they go down, right now they are down. What is your point?
The State/County are “suffering” from lower tax revenues. They can’t do a lot about the sales tax dropping off but they can sure screw around with their citizen’s property taxes. Maybe they ought to do what we do when our income goes down, SPEND LESS!!!
You are correct that some folks are selling below what they bought for. I meant to say that no one sells or is selling at below CAD value. comparing cad value to asking price does not seem fair to me. it is market that determines the selling price. it is easy to check the facts here. i find no property, privatehome or commercial property that has sold under cad value. so, again i ask what is the point of the article
I can tell you who goes by the CAD value – that would be the tax man. And I'm the one who has to pay the tax, man. Not interested in selling or buying now or any time soon. If the CAD is fudging the numbers to pad my school district's budget in an otherwise down economy and real estate market, I can tell you I don't like that one bit. Are these guys at the CAD elected or appointed or what? Looks like most of them are representing every school district in the county. Is that coincidental or what, considering the current economy? I can see where a tight bunch of good old boys would look out for their districts budgets first while I and a lot of other unsuspecting property owners get lost in the shuffle as well as stiffed. Maybe ODell's got his finger on some potentially major malfeasance here and should be investigated more closely.
Please expose HCAD Chief Appraiser David Valle's appraisals over the last seven years of Wimberley Springs/Quicksand/Asset Management properties...Please! For those of you who are year after year facing these extraordinary property tax increases you need to know how HCAD has given these land speculators huge tax cuts!
The greedy insatiable school districts are the prime movers in this ridiculous appraisal scam. While other county entities can and do complain they are no matches for the schoolies. They will, of course, use “the children” as an excuse and the soccer moms will shed tears and forgive them again. I often wonder why the schools take so much more of our money than anyone else. Could it be because that they build over-the-top palaces of education (Jacobs Well Elementary) and install Astro-Turf in a Wimberley HS athletic field?
speaking of tax appraisals in this county, how is it that newly built spec houses in Woodcreek North are being appraised at a significantly lower rate than houses on either side of them but being listed for sale at comparable neighborhood sales prices. Again, these houses are being built on a major developer's lots??!! And being listed with a major land/realty company. What's up with that?
Having been to the Tax Appraisal Office almost every year since 2001 to protest increases in my property value, I can make the following observations: not all property is reassessed each year (just look at different parts of Wimberley); I have been told there is only one true appraiser, rest of the staff just check to see if there are improvements to the property and if there were sales in the area to gauge values even if sales are 1-2 years old (per one of the staff); staff hasn't time to reappraise each property every 4 years as law states.
Finally the HCCAD is political in that it is used to change property values so the taxing entities can say they didn't raise our taxes or ask for a the voters for a tax increase.
glad we have someone on board that has integrity and is trustworthy
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