property tax binding arbitration for property ownersappraisaldistrictguide.com/texas/manuals/binding...

Property Tax Binding Arbitration for Property Owners

Susan Combs, Texas Comptroller of Public Accounts NOVEMBER 2010

Frequently Asked Questions• thedisputedproperty’svalue,asdeterminedbytheARB,doesnotexceed$1million,exceptforresidencehomesteadsforwhichthereisnovaluelimit;

• taxeshavebeentimelypaid;and• alawsuithasnotbeenfiledindistrictcourtonthesamematter.

What appraisal disputes do not qualify for arbitration?Bindingarbitrationisnotavailableif:• theARBhasnotheardtheprotestandissuedanorder;

• theorderofdeterminationconcernsacorrectiontotheappraisalrollunderTaxCode§25.25;• morethan45dayshavepassedsincethepropertyownerreceivedtheARBorder;

• thedisputeconcernsany-thingotherthanwhetherthecorrectvaluehasbeenassignedtotheproperty,suchasfailuretograntanexemptionorproductivityappraisalortheuniformityorequalityofappraisalsinagivenareaorregion;or

• thepropertythatisnotahomesteadisvaluedatmorethan$1millionasdeterminedbytheARBorder.

What is an appraisal review board?AnARBisaneutral,impartialgroupofindi-vidualsappointedbyanappraisaldistrictboard

BeforeSept.1,2005,apropertyownercouldonlyappealanAppraisalReviewBoard

(ARB)decisionindistrictcourt.TaxCodeChapter41AgivespropertyownersmeetingcertaincriteriatheoptionofrequestingbindingarbitrationasanalternativetofilinganappealofanARB’sdecisiontostatedistrictcourt.Belowisalistoffrequentlyaskedquestionsregardingthisprogramandwhatisrequiredforpropertyownerstoqualify.

What is binding arbitration?Generally,inbindingarbitration,anindependent,neutralarbitratorhearsandexaminesthefactsofanappealandmakesadecisionthatisbindingonbothparties.Morespecifi-cally,bindingarbitration,inthecontextofpropertyvaluedisputes,createsaforuminwhichbothpartiestoadisputepresenttheirpositionsbeforeanimpartialthirdparty,whorendersaspecificawardthatisenforceablebylawandmayonlybeappealedasprovidedbyCivilPracticesandRem-ediesCode§171.088,forpur-posesofvacatinganaward.

Who qualifies for arbitration?Apropertyownermayrequestbindingarbitrationif:• thepropertyindisputeisrealorpersonalproperty;• thecountyappraisalreviewboard(ARB)hasissuedadeterminationontheappraisedormar-ketvalueoftheproperty,butnotanunequalappraisaldetermination;

Binding arbitration creates a forum in which both parties to a dispute present their positions before an impartial third party.

For more information, visit our Web sitewww.window.state.tx.us.Receive tax help via e-mail at [email protected].

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ofdirectorstoresolveformaldisputesbetweentaxpayersandtheappraisaldistrict.

ARBhearingstypicallyrunfromJunetoAugust.TheARBlistenstobothsidesandrulesonprop-ertyownerprotests.AnARBissuesan“order”determiningtheoutcomeofapropertyowner’sprotest.ARBdecisionsarebindingonlyfortheyearunderprotest.

Are there restrictions on when I can file for binding arbitration?Arequestforbindingarbitrationmustbefiled with the appraisal districtwithin45daysofthepropertyownerreceivingtheARBorderdeterminingtheprotest.Please do not file the request with the Comptroller of Pub-lic Accounts — you will probably miss the 45-day deadline.

Have property owners always been able to arbitrate a dispute with the appraisal district?Since1991,thelawhasallowedjudgesofstatedistrictcourtstoappointarbitratorsincertaincases.Bindingarbitrationhasbeenallowedifthepropertyownerandtheappraisaldistrictbothagreetotheprocess,andnonbindingarbitrationhasbeenpermittedwithouttheconsentoftheappraisaldistrict.The2005TexasLegislaturechangedthelawtoexpandthearbitrationpro-cess.Thelawnowallowscertainpropertyown-erswhoaredissatisfiedwiththedecisionofanARBtorequestbindingarbitrationwithoutfilingalawsuitindistrictcourt.

How do I request binding arbitration?ThepropertyownermustcompleteComptrollerformAP-219,Request for Binding Arbitration,andfiletheformandtherequiredpaymentwiththeCounty Appraisal Districtwithin45daysofreceivingtheARBorder.Theformmustbeaccompaniedbyamoneyorderoracheckissuedandguaranteedbyabankinginstitution,suchasacashier’sorteller’scheck,intheamountof$250or$500madepayabletotheComptroller

ofPublicAccounts.Personalchecks,cashoranyotherformofpaymentnotmentionedabovecan-notbeacceptedbytheappraisaldistrict.

Please do not file the request with the Comp-troller of Public Accounts — you will probably miss your 45-day deadline. TheComptrollercannotprocesstherequestwithouttheappraisaldistrict’scertification,andtheComptrollercan-notforwardyourrequesttotheappraisaldistrict.IfyoubypasstheappraisaldistrictandsendtherequesttotheComptroller,theComptrollermustreturntherequestandpaymenttoyou.TheComptrollerisnotresponsibleformisfiledormissentapplications.

YoushouldreceiveComptrollerformAP-219,Request for Binding Arbitration,andanoticeofthepropertyowner’srightswiththeOrderofDeterminationissuedbytheARB.ThisformcanalsobefoundontheComptroller’sWebsiteatwww.window.state.tx.us/taxinfo/proptax/arbitration05.IfyoudonotreceiveaRequest for Binding Arbitrationform,andyouthinkyouqualifyforarbitration,contactyourcountyappraisaldistrict.

What is the difference between binding arbitration and expedited arbitration?Bothareformsofbindingarbitration.Bindingarbitrationcosts$500andhasnorestrictionscon-cerningtheamountoftimespentonargumentandtestimonyinanarbitrationhearing.Expeditedarbi-trationcosts$250andislimitedtouptoonehourofargumentandtestimonybyeachparty.Whenrequestingarbitrationapropertyownershouldiden-tifyonthearbitrationapplicationwhetherheorsheisrequestingbindingorexpeditedarbitration.

After I apply for arbitration, can I change my mind and move from binding arbitration or expedited arbitration to the other type of arbitration?Thedecisiononwhichtypeofarbitrationthepropertyownerisrequestingmustbemadepriortoapplyingforanybindingarbitration.

Do not file the request with the Comptroller of Public Accounts — you will prob-ably miss the 45 day deadline. Arbitration applications must be filed with the county appraisal district. The Comptroller is not responsible for misfiled or missent applications.

For more information, visit our Web site www.window.state.tx.us.Receive tax help via e-mail at [email protected].

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Bindingarbitrationforcontiguouspropertiesisanappealthatallowsapropertyownerwhohastwoormorepiecesofcontiguouspropertytobeheardinasinglearbitration.Toqualify,thepropertiesmustbecontiguoustooneanotherandmustbelongtothesamepropertyowner.Apropertyownermayrequestbindingorexpe-ditedarbitrationforcontiguousproperties.Whenapplyingforarbitrationforcontiguousproper-ties,theownershouldidentifyonthearbitrationapplicationthatheorsheisrequestingarbitrationforcontiguouspropertiesandidentifyallcontigu-ouspropertiestobeconsideredforarbitration.

What happens after the property owner submits the request to the appraisal district?Theappraisaldistrictmustcertifytheappli-cationandforwardtherequestandthemoneyorder/cashier’scheck,alongwithacopyoftheARBorder,totheComp-trollerwithin10calendardays.Someappraisaldistrictsmaycontactyouconcerningyourrequest.

Does it cost anything to arbitrate my dispute?Thepropertyownermustmakeacashier’scheckormoneyorderdepositof$250or$500payabletotheComptrollertorequestbindingarbitra-tion.Thedepositmustbedeliveredwiththeapplicationtotheappraisaldistrict,nottotheComptroller.Regardlessoftheoutcome,includ-ingwithdrawalofyourrequestordenialofyourrequest,theComptroller’sofficeretains10%ofthedepositforadministrativecosts.Iftheproper-tyowner“wins”thedispute(thearbitratorsetsavalueforthepropertynearertotheowner’sopin-ionofvaluethantheappraisalreviewboard’sdeterminationasshownontherequestform),the

propertyownerwillberefunded$225or$450dependingonthetypeofarbitration.Theapprais-aldistrictwouldthenberequiredtopaythearbitrator’sfees.Ifthearbitrator’sassignedvalueisnotnearertotheowner’sopinionofvaluethantheappraisaldistrict’svalue,thearbitratorispaidfromthepropertyowner’sdeposit.Ifthearbitra-torchargeslessthanthefulldeposit,anyremain-derwillberefundedtothepropertyowner.

How do I choose an arbitrator?Oncethepropertyowner’srequestforbindingarbitrationhasbeenprocessed,theComptrol-ler’sofficewillmailthepropertyowneraletterwithinstructionsonhowtoaccessthearbitratorregistryonline(ahardcopyoftheregistryisavailableonrequest)andform50-706,Appoint-

ment of Arbitrator,thatallowsthepropertyownerandtheappraisaldistricttoagreeonuptothreearbitratorchoices.Thepropertyownerandtheappraisaldistricthave20daystoagreeonanarbitratorandreturnthecompletedformtotheComptroller’soffice.

Whenthepropertyownergetstheletter

andtheform,locatethearbitratorregistryontheComptroller’sWebsiteat:www.window.state.tx.us/taxinfo/proptax/arbitration05/.ClickonArbitratorRegistrySearchandmakeyourselec-tionforqualifiedarbitratorswillingtoarbitrateinyourarea.UsetheHelpfeaturetoassistinusingtheregistry.Choosethreearbitrators,fillintheirnamesandtaxpayeridentificationnumbersontheformanddelivertheformtotheappraisaldistrict.Youmaywanttocontacttheappraisaldistricttofindouthowitprocessestheformwhenreceived.Practicesamongtheappraisaldistrictsvary.TheappraisaldistrictisresponsibleforreturningthesignedformtotheComptroller.


What is binding arbitration for contiguous property?

The property owner and the appraisal

district have 20 days to agree on an arbi-

trator and return the completed form to the

Comptroller’s office.

For more information, visit our Web site

www.window.state.tx.us.Receive tax help

via e-mail at [email protected].


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Theappraisaldistrictmaydeclinetoagreewithallthreechoicesyouhavemade.

TheComptrollerwillcontacttheproposedarbitrator(s)todetermineiftheselectedarbi-tratoragreestohearthedispute.Ifallthreearbitratorsdeclinetohearthedispute,theComptrollerwillrandomlyselectanarbitratortohearthedispute.

What should I do if I discover that information about an arbitrator on the arbitrator registry is incorrect?YoushouldimmediatelyinformtheComptrol-ler’sofficeinwritingorbye-mailaboutanydiscrepanciesoroutdatedinformationconcerninganindividualonthearbitratorregistry.

What if the appraisal district and I don’t agree on an arbitrator?Ifthepropertyownerandtheappraisaldistrictcannotagreeonanarbitratorwithin20days,theComptrollerwillrandomlyselectandappointanarbitratortohearthedispute.

Does the Comptroller have the authority to intervene in arbitrations?TheComptroller’sofficeisprohibited,byRule,fromgivingadviceordirectiononamatterrelat-ingtoapendingarbitration.Comptrollerstaffmembersareresponsibleformaintainingthearbitratorregistry,processingtherequestsforbindingarbitration,remittingpaymenttothearbitratorwhenappropriateand/orrefundingpartofthepropertyowner’sdeposit,ifapplicable.

What if I change my mind and decide not to arbitrate? Can I get my money back?Youmayaskforawithdrawalofyourrequestforbindingarbitrationupto14daysbeforethefirstscheduledhearing.Ifyourequestthewithdrawal14ormoredaysbeforethefirstscheduledhear-ing,theComptrollerwillrefund90percentofthepropertyowner’sdeposit,retaining10percentofthedepositforadministrativecosts.

Ifyourequestawithdrawal13daysorfewerbeforethefirstscheduledhearing,thearbitrationwillautomaticallydefaultinfavoroftheapprais-aldistrict.Thearbitratorwillbepaidfromthepropertyowner’sdeposit.Ifthearbitrator’sfeeislessthanthedeposit,theremainderofthefundswillberefundedtothepropertyowner.

Youmustrequestawithdrawalin writingtotheComptroller,theappraisaldistrictandthearbitra-torifonehasbeenassigned.Anoralrequestforwithdrawalwillnotbeaccepted.Requestsforwith-drawaltotheComptrollercanbemailedto:P.O.Box13528;Austin,Texas78711orhanddeliveredto:1711SanJacinto;Austin,Texas78701.TherequestscanalsobefaxedtotheComptrollerat:(512)[email protected](mustincludeasignature).

Why would an appraisal district reject my request for arbitration?Theappraisaldistrictmayrejecttherequestforarbitrationiftherequisitecashier’scheckormoneyorderisnotprovidedbythepropertyowner.Thisistheonlyreasontheappraisaldis-trictmayrejectarequest.Allotherdetermina-tionsmustbemadebytheComptroller.Eachrequestforarbitrationmustbeaccompaniedbyaseparate$250/$500deposit.

Why would the Comptroller reject my request?Thereareanumberofreasonswhyarequestforarbitrationcouldberejected.Somereasonsare:• morethan45dayshavepassedsincetheARBorderwasreceivedandtheappraisaldistrictdidnotreceivetherequest;

• thepropertyowner’sagentisnotqualifiedtorepresentthepropertyowner;

• thetaxesonthesubjectpropertyare(orhavebecome)delinquent;

• thedisputedrealorpersonalpropertyisappraisedatmorethan$1millionbytheARBorder,unlessthepropertyisaresidencehomestead;


Comptroller staff are responsible for maintaining the arbitrator regis-try, processing the requests, remitting payment to the arbitrator when appropriate and/or refunding part of the property owner’s deposit.




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• theissueindisputeisnotaboutappraisedormarketvalue,butequalityanduniformity,exemptionqualification,oranothermatter;

• theorderofdeterminationwasforacorrectiontotheappraisalrollunderTaxCode§25.25;or

• thepropertyowneroragentdoesnotprovideadditionalinformationrequestedbytheComp-trollerwithin10daysoftherequest.

What happens if my arbitration request is rejected?TheComptroller’sofficewillrefund90percentofthedepositforarejectedrequestforbindingarbitrationandretain10percentforadminis-trativecosts.

Yourrequestmustbefiledwithyourcountyapprisaldis-trict.IfyoufileyourrequestwiththeComptroller’sofficewithoutgoingthroughthecountyappraisaldistrict,youmaybeabletofileasecondrequestwiththeappraisaldistrictif45dayshavenotelapsedsinceyoureceivedtheARBorder.

After the arbitrator is chosen, what happens?Thearbitratorcontactsboththepropertyownerandtheappraisaldistrictbytelephoneandarrangesadate,timeandlocationforthearbitra-tion.ThearbitratormustmanagethearbitrationaccordingtoComptrollerRule9.804.

Thearbitratorisrequiredtoprovideasetofproceduresthatwillbeusedinthearbitrationproceedings.AcopyofComptrollerRule9.804islocatedontheComptroller’sWebsiteatwww.window.state.tx.us/taxinfo/proptax/arbitration05.ThearbitratorwillalsofollowcertainprovisionsoftheTexasTaxCodeandtheTexasCivilPrac-ticesandRemediesCode.

Afterhearingbothsides,thearbitratormustrenderadecisionandcompleteComptrollerform50-704,Arbitration Determination and Award.ThearbitratormustmailtheformtotheComptroller’sofficeandmaymail,faxore-mailcopiestothepropertyownerandtheappraisaldistrict.Inadditiontothemailedoriginalaward,thearbitratormayfaxore-mailacopytothe

Comptroller’soffice.AftertheComptroller’sofficereceivesthisform,theComptroller’sofficewillsendeitherapay-menttothearbitratororarefundtothepropertyowner,orinsomeinstances,both.

Who may represent a property owner in a request for binding arbitration?Thepartiestoarbitrationmayrepresentthemselvesorbe

representedbyanattorney,alicensedrealestatebrokerorsalesperson,acertifiedrealestateappraiser,apropertytaxconsultantoracertifiedpublicaccountant.These“agents”musthavewrittenauthorizationsignedbythepropertyowner.Note: a lawyer doesn’t have to have this authorization.

May I arbitrate and appeal the decision in district court?Thearbitrationproceedingsarebinding.Anarbi-trationawardmaybevacatedunderlimitedsitu-ations(CivilPracticesandRemediesCode,Sec-tion171.088).Anappealofthearbitrator’sawardindistrictcourtcannotbefiledifyouaresimplydissatisfiedwiththevaluedetermination.

What if the arbitrator does not follow Comptroller Rule 9.804 or other law?Theintegrityofthearbitratorregistryisveryimportant.Therefore,allpartiesshouldbecomefamiliarwithComptrollerRule9.804aswellasapplicableprovisionsoftheTaxCodeandTexasCivilPracticesandRemediesCode.The


After hearing both sides, the arbitrator must render a deci-

sion and complete Comptroller form

50-704, Arbitration Determination and

Award.


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Comptroller’sofficeisnotthelicensingorcerti-fyingauthorityforthearbitratorsontheregistry.TheComptroller’sroleistoplaceanarbitrator’snameontheregistryafterreceiptofanapplica-tionwithaccompanyingqualifyingdocumenta-tiontobeontheregistry.Onlycomplaintscon-cerningwhetherthearbitratormeetsthestatutoryrequirementstobeontheregistryshouldbedirectedtotheComptroller.Allothercomplaintsshouldbedirectedtotheappropriatelicensingorcertificationauthority.

Am I required to follow Comptroller Rule 9.804?FailuretofollowComptrol-lerRules,relevantprovisionsoftheTaxCodeandTexasCivilPracticesandRemediesCode,orthearbitrator’spro-cedurescouldhavenegativeconsequences,includingbutnotlimitedtothefollowing:

• rejectionoftherequestforbindingarbitration;• lossofdeposit;and• dismissalofthearbitration.

Do I have to physically attend a formal hearing?Thepropertyownermayrequesttohavethearbitrationinperson,byteleconferenceorbysubmittingwrittendocumentationtothearbitra-tor.However,unlessthepropertyownerandtheappraisaldistrictbothagreetoarbitrationbysubmissionofwrittendocumentsthearbitrationwillbeconductedinpersonorbyteleconference.Anarbitratormayrequirethatthearbitrationbeconductedinperson.

May I request that the Comptroller put my arbitration on hold while I conduct other business?TheComptrollerdoesnothavetheauthoritytodelayyourarbitration.Youmustcontactthearbitratordirectlytomakethisrequest.Anysucharrangementinvolvesthepropertyownerandthearbitrator.TheComptrollerisnotapartytothisdecision.ComptrollerRulesencouragearbitratorstoconcludeallarbitrationswithin120daysofbeingassignedtobethearbitrator.

Who decides where and when a hearing will occur?Thearbitratorisresponsibleforarrangingthelocationandtimeofthearbitration,andwillpresumablyworkwiththepartiesinvolvedinthatdecision.In-personhearingsaretotakeplaceinthecountywheretheappraisaldistrictofficeis

locatedandfromwhichtheARB’sdeterminationwasissued;however,thearbitrationcanbecon-ductedelsewhere,ifthepartiesagree.

As a result of arbitration, may your property’s value on the appraisal roll be increased above the amount of the appraisal review board order?

Thechiefappraisermayonlycorrecttheappraisalrollifthearbitrationawardisbelowtheappraisalreviewboardorder.

What if I disagree with the outcome of the arbitration?Thedecisionofthearbitratorisfinalandbindingonbothparties.Byarbitratingthedisputeyouagreedtoabidebythearbitrator’sdecision.





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What if I have questions?The following is contact information for the Arbitration Section:


Mailing address:Comptroller of Public AccountsProperty Tax Assistance DivisionAttn: ArbitrationP. O. Box 13528Austin, Texas 78711

E-mail address: [email protected]

Phone: (800) 252-9121

Fax: (512) 463-8354

We’re Here To Help! Call Toll-Free!If you have questions or need information on a specific tax, please call our toll-free numbers:

(800) 252-5555911 Emergency Service/Equalization

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Equipment SurchargeOyster FeeSales and Use TaxesTelecommunications Infrastructure

Fund

(800) 531-5441Cement TaxInheritance TaxLocal RevenueMiscellaneous Gross Receipts TaxesOil Well Servicing TaxSulphur Tax

(800) 531-5441, ext. 3-3630WebFile Help

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(800) 252-7875Spanish

(800) 531-1441Fax on Demand (Most frequently

requested Sales and Franchise tax forms)

(800) 252-1382Clean Vehicle Incentive ProgramManufactured Housing TaxMotor Vehicle Sales Surcharge,

Rental and Seller Financed Sales Tax

Motor Vehicle Registration Surcharge

(800) 252-1383Fuels TaxIFTALG Decals Petroleum Products Delivery FeeSchool Fund Benefit Fee

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(800) 252-1386Certificates of Account Status/Good

StandingOfficer and Director Information

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(888) 4-FILING (888-434-5464)TELEFILE: To File by Phone

(800) 252-1389GETPUB: To Order Forms and

Publications

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(512) 463-3120 in Austin

(877) 44RATE4 (877-447-2834)Interest Rate

Texas Comptroller of Public AccountsPublication #96-1197

Revised November 2010

For additional copies write:

Texas Comptroller of Public Accounts P.O. Box 13528

Austin, Texas 78711-3528

For more information, visit our Web site www.window.state.tx.us

Receive tax help via e-mail at [email protected]

Sign up to receive e-mail updates on the Comptroller topics of your choice at www.window.state.tx.us/subscribe.

The Texas Comptroller of Public Accounts is an equal opportunity employer and does not discriminate on the basis of race, color, religion, sex, national origin, age or disability in employment or in the provision of any services, programs or activities.

In compliance with the Americans with Disabilities Act, this document may be requested in alternative formats by calling the appropriate toll-free number listed at left, or by calling:

(512) 463-4600 in Austin(512) 475-0900 (FAX).

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