equal and uniform · uniform taxation, equal and uniform taxation must prevail •back to dallas...

EQUAL AND UNIFORM 27TH ANNUAL CONFERENCE

DALLAS, TEXAS

OCTOBER 9, 2014

A MEDIA PHENOMENON!

• Dallas

• Houston

• San Antonio

• Austin

• Even Waco

IN REALITY THE EQUITY STATUTE IS:

• The devil incarnate or worse

• Shifting taxes to homeowners

• A loophole providing corporate welfare

• Unfairly using the median value

• Undermining the tax roll (spiraling down)

IT CAN BE FIXED BY:

• Repealing 41.44 (b) (3) and/or

• Limiting 41.44 to residences valued less than $1million

• Mandating sale price disclosure

PRIOR TO 41.44 (B) (3) :

• Dallas National Bank v. Dallas County (1943) • Subject assessed at $175 per acre

• Comparable adjoining tracts assessed value ranged from $20 to $30 per acre

• “Same approximate kind and value”

PRIOR TO 41.44 (B) (3) :

• Appeals Court Decision (1943)• Assessing subject at 70 percent of value and others at 10 percent of value is unequal

• Such assessment unconstitutional

• Even without evidence of a systematic plan to discriminate

• Values should have been equalized either by lowering the subject or raising the others

PRIOR TO 41.44 (B) (3) :

• After Dallas National Bank v. Dallas County • Generally only a deliberate plan to discriminate was unequal appraisal

• Equalization Boards can decide what is “equal”

• Exact equality is unattainable

• Differences based on judgment regarding property value not unequal

PRIOR TO 41.44 (B) (3) :

• After Dallas National Bank v. Dallas County • Assessing individuals’ properties at 50 percent and railroad property at 100 percent was unequal appraisal

• Assessing all land at $20 per acre not equal and uniform

• Assessing oil and gas properties at 100 percent and all other properties at varying percentages unrelated to market value constituted unequal appraisal

• Generally difficult to prevail

AFTER 41.44 PRIOR TO (B) (3) :

• A Sampling Problem!

• Sales ratio study required

• Reasonable and representative sample of other properties

• Reasonable number sample of similarly situated or same general kind and character

AFTER 41.44 (B) (3) :

• A Sampling Problem Solved!

• … a reasonable number of comparable properties appropriately adjusted

AFTER 41.44 (B) (3) :

• Harris County Appraisal District (HCAD) v. United Investors Realty Trust

• If a conflict exists between taxation at market value and equal and uniform taxation, equal and uniform taxation must prevail

• Back to Dallas National Bank v. Dallas County?

• Judge must lower value to median

AFTER 41.44 (B) (3) :

• Looting the tax base

• Will spiral down

• Unfairly shifting the burden to homeowners

• Cherry picking

WHAT ARE THEY THINKING? :

• Systemic Threat

• Homeowners Footing the Bill

• Local Government Will Be Starved

• The End of Civilization as We Know it

AFTER 41.44 (B) (3) :

Source: Popp | Hutcheson

AFTER 41.44 (B) (3) :

Source: Popp | Hutcheson

WHAT ARE THEY THINKING? • Lawsuit reductions in 2012 were $13.75B or 3% of the total reductions granted and only 0.6% of the total

statewide appraisal roll,

• Homestead and appraisal cap deductions were $161.9B in 2012,

• Ag use appraised value deductions in 2012 were $206B

• Some other 2012 deductions: abatements $16.9B, freeport $26.2B, tax increment financing $11.28, and pollution control $10.49

• In 2012, $29B in reductions were made at informal settlements and $18B in reductions were made at ARB hearings.

• A $2750 homestead exemption would offset all litigation reductions

Source: Popp | Hutcheson