Williamson County property appraisals

Williamson County property appraisals

By Rob Heidrick Friday, 13 February 2009

As Williamson County residents submitted their 2008 property tax payments in early February, county appraisers were concluding the district’s first round of property evaluations for the coming year. Their analysis of local home values in the next several months will ultimately be used to determine property tax rates for all residences in the county.

Despite a volatile national housing market, local officials foresee only minor changes in the region’s average tax bill. Alvin Lankford, the incoming chief appraiser at the Williamson Central Appraisal District, said that while it is too early to predict how this year’s home values will compare to last year’s, Central Texas has thus far managed to avoid the sharp price declines plaguing other areas of the nation.

“Texas has been fortunate that we haven’t taken that kind of hit,” Lankford said. “But it’s a little early in the process to know how we’ve been affected.”

Notifications of homes’ appraised values will be mailed to residents by mid-April.

Calculating home values

The appraisal district values each home according to the actual selling prices of similar homes in the area. District officials draw boundaries around neighborhoods with homes of comparable value and evaluate each property based on its estimated sales price, as well as factors such as age, size and structural condition.

WCAD appraises new homes as soon as they are built and reappraises every property in the county annually. However, district employees do not inspect every property in person each year, Lankford said. Appraisers frequently use market statistics to project a home’s appreciation or depreciation, but because Texas is one of a handful of states that do not require home sellers to disclose pricing information, the district has to consult Realtors, property owners and real estate listings to gather accurate figures.

“We have to kind of scrounge around and talk to many different sources to try to get all the sales data we can,” Lankford said.

There is no official schedule for re-inspections, and Lankford said houses could be visited within a range of once a year to once every six years. WCAD does not give advance notice of an inspector’s arrival, but Lankford said the appraisers knock on doors and speak with property owners if they are home. When visiting a home, inspectors confirm lot measurements, evaluate new improvements and check for damages that could devalue a home.

Homeowners are not usually required to report improvements such as additions or remodels unless the property is also used as a business, but appraisers will document the upgrades as soon as they visit the property.

Property value to property tax

WCAD analysts compute the total taxable value for each area, and local taxing authorities — including city governments, school districts and public utility providers — use the information to calculate their respective tax rates for the coming year.

“They make their decisions on what kind of tax rate they need based on the values that they’ve got to handle their budget,” said Joe Pondrom, chief deputy tax assessor-collector for Williamson County.

The assessor-collector’s office gathers tax rates and property information from each district and then bills residents accordingly.

Cities use property tax revenues to fund public services, such as police, parks and recreation, and community development.

Appraisal caps

Increases in home values generally lead to rising tax bills, but Texas law limits the amount that a house’s taxable value can grow from one year to the next.

Under the state’s 10 percent appraisal cap policy, even if a home’s actual market value goes up by more than 10 percent from one year to the next, the homeowner will not have to pay taxes on any increase beyond that amount. For example, if a home was valued at $100,000 in 2008, its owner could not be taxed for more than $110,000 on the same house in 2009 — even if WCAD determines it could have sold for $120,000.

The cap, which covers a taxpayer’s primary residence, is not automatically applied. The owner must fill out a free homestead exemption application, available online or at the WCAD office.

Williamson County residents have mixed opinions on appraisal caps. Taxpayers benefit by avoiding sharp increases in annual tax payments, but some local governments believe the caps limit the funds a city takes in each year.

“We’re unable to collect on potential property tax, which really impacts the level of services we’re able to provide,” said Micah Grau, a budget and special project coordinator with the City of Hutto’s finance department. “Because of the way the tax system is set up, every piece of property should pay fair value, and you end up with disparities in the tax level when you have the appraisal caps.”

Outlook for 2009

Grau said there is no clear way to predict this year’s home values, but he expects Hutto’s tax rate to remain fairly steady. Hutto, like many cities in Williamson County, has experienced a population boom in recent years, resulting in a larger tax base and more money rolling into the city’s general fund. But with complicating factors, such as the sluggish real estate market and the arrival of high-end housing developments in the area, the outlook for this year’s property values remains uncertain.

2009 Property appraisal and tax calendar

• Jan. 1 – All residential properties are appraised according to their value as of this date.
• January-March – Appraisers inspect homes, analyze local housing markets and calculate values for every home in the county.
• Early April – Homeowners receive notices informing them of their appraised home values, along with documents to file formal protests if desired.
• April-May – Residents may file protests with the Appraisal Review Board.
• June 1 – ARB stops accepting protest applications on this date or within 30 days after the appraisal is received; whichever is later.
• July 27 – The appraisal district releases data on the total property values for each area in the county.
• August-September – Cities, school districts and other tax districts calculate their own tax rates and set their budgets based largely on the total property values in their areas.
• Sept. 29 – 2009 tax rates are finalized. The county tax assessor-collector begins to prepare tax bills.
• Oct. 1 – The assessor mails tax bills, which will be due by the following February.

Source: Texas Comptroller of Public Accounts

Legislature considers business appraisal caps

Texas’ 10 percent appraisal cap currently applies only to houses inhabited by their owners, but two bills filed Feb. 2 at the Texas House of Representatives could expand the law to cover business property.

Rep. Bill Callegari, R-Katy, introduced House Bill 979 and Joint Resolution 49 in response to steadily increasing property taxes among businesses in recent years. Without a cap, a business’s appraised value could increase well beyond 10 percent each year.

Callegari’s legislation amends the original appraisal cap policy to replace references to “residence homesteads” with the more inclusive term “real property.” Most of the remaining language is unchanged.

Rep. Dan Gattis, R-Georgetown, said that applying the appraisal cap solely to homesteads might appear to benefit homeowners, but it has several unseen consequences for the local economy.

“If businesses’ tax goes up tremendously, we pay for it because of lower employment, higher prices of goods and services, and they don’t expand when they could because they’re paying higher taxes,” he said.

Gattis said the current system also potentially allows appraisers to squeeze more taxes out of businesses.

“As you limit the amount that homes go up and you don’t limit the businesses, you put an incentive for tax entities and appraisal districts to go look really hard at businesses, because they can get as much out of them as possible,” he said.

The measures are up for consideration until the legislative session closes this summer. If adopted by the legislature and approved by voters in the November election, the bills would take effect Jan. 1, 2010.

How to dispute a property appraisal

Homeowners who believe their properties have been unfairly or incorrectly evaluated have the right to file a protest with the appraisal district. Disputes can be settled informally or, if necessary, at full-scale review hearings.

Step 1› Before filing an official protest, homeowners can discuss their cases informally at the appraisal office. Appraisers have the authority to adjust a home’s taxable value, and in several cases they have made changes based on information gathered from documents such as closing papers, deeds, engineer’s reports and home sales reports.

Step 2› If a property owner disagrees with the appraiser’s decision at the conclusion of the informal meeting, he or she can file a written protest and request to appear before the Appraisal Review Board. Protest forms are mailed with appraisal notice packets in April and must be filed by June 1 or within 30 days of receiving the notice, whichever is later.

Step 3› Upon receiving a protest notice, the district assigns an ARB hearing date. Homeowners have the right to review the documentation WCAD consulted in calculating the home value. The board examines evidence presented by the homeowner and rules on whether the appraised value should be adjusted.

Step 4› Residents can appeal ARB decisions to a district court or resolve them through binding third-party arbitration.

Source: Williamson County Appraisal District

Average property tax bill

• Georgetown
  • Average residential property taxable value, after exemptions: $193,263
  • Average property tax burden per homeowner: $4,086.62
• Hutto
  • Average residential property taxable value, after exemptions: $137,034
  • Average property tax burden per homeowner: $3,456.65
• Taylor
  • Average residential property taxable value, after exemptions: $89,825
  • Average property tax burden per homeowner: $2,208.19