Tax Valuations Require Transparency
The underlying issue with valuations is the appraisal review board within the appraisal system, says Rahul Patel, managing partner of Patel Gaines, a Texas-based law firm specializing in property tax issues.
DALLAS—It’s pretty much a fact that property taxes go up annually in Texas. Proposals such as caps on annual increases and sales price disclosure on commercial properties ignore the root of the problem of the annual increases, GlobeSt.com learns.
When a property owner isn’t satisfied with the appraised value and hasn’t been able to negotiate an acceptable amount with the appraisal district, the review board is the next step. However, the underlying problem is the appraisal review board within the appraisal system, says Rahul Patel, managing partner of Patel Gaines, a Texas-based law firm specializing in property tax issues.
“As an attorney who has represented hundreds of property owners in appraisal review hearings, I can tell you first hand that many appraisal review board members simply are not qualified to handle complex residential or commercial valuations,” says Patel. “Setting a value on a $75,000 condo is in no way comparable to doing so on an $80 million commercial property. Complex valuations should be handled by qualified appraisers or experts.”
Furthermore, the actions of the review boards are not transparent and members are not accountable in the current system, he contends.
“The appraisal district selects, pays and supervises the ARB (appraisal review board) members,” Patel points out. “Their deliberations and decisions should be just as transparent as any other public agency that has direct decision-making authority over public money. If we get better judges and jury members, we will get better outcomes leading to fairer determinations.”
One of the proposals floated at the recent Texas Republican Party convention in San Antonio was to abolish local appraisal districts and use only sales prices to set properties’ values. Patel says this change may lead to higher taxable valuations if prices are actually rising faster than appraised values, GlobeSt.com learns.
Patel is also an adjunct professor at the University of Houston and a frequent speaker on real estate matters.