More than a month ago, angry taxpayers seeing red over higher property valuations stormed Comal County Commissioners Court, demanding answers that commissioners couldn’t give.
Their anger next targeted the Comal Appraisal District, which assesses and certifies market and taxable values for 36 taxing jurisdictions in Comal and adjacent counties, where forecasted 2022 assessments are now projected to rise between 45% and 50%.
The CAD assesses properties for the city of New Braunfels, Comal County, the New Braunfels and Comal ISDs, and all or parts of the cities of Bulverde, Fair Oaks Ranch, Garden Ridge, Spring Branch, Schertz and Selma.
Its jurisdictions also include portions of the Boerne and Wimberley ISDs, all seven Comal County emergency services districts, Johnson Ranch and Meyer Ranch municipal utility districts, and the new Lake Dunlap and Canyon Water Control Improvement Districts.
Those entities could lower property taxes this year because of the nationwide market explosion. In Harris County, the state’s most populous county, residential values have risen between 15% and 30%. In Bexar County, the median value of a home appreciated nearly 25% to $265,540; in Travis County, values skyrocketed by more than 50% to $632,208.
In Comal County, average home values escalated to $489,835, and valuations doubled, tripled and even quadrupled 2021 totals in the largest annual increase in the CAD’s 42-year existence.
Homeowners fear they will see a similar rise in their property tax bills — though those don’t necessarily go hand in hand. The Texas Tax Code gives property owners the right to protest valuations through a CAD process that begins with staffers and continues to the Comal County Appraisal Review Board, or ARB.
10,000 more protest than 2021
As of June 6, 27,020 filed protests to lower their residential, commercial and other valuations involving 108,735 taxable land parcels within the CAD jurisdiction – more than 10,000 over the 17,436 protests filed last year. Those who filed appeals on or before the May 16 deadline can submit evidence of overvalued assessments to the CAD.
New construction at KB Home Deer Crest in New Braunfels.
“There is a process established in the legislation that created the appraisal districts that allows for the values to be protested and beyond, if they don’t come to a resolution with the appraisal district,” said County Judge Sherman Krause, previously the county’s tax assessor-collector.
Two months ago, Krause and commissioners were lit up by residents seeking to blame somebody, anybody, for a state law that squarely places responsibility with state legislators charged with determining formulas to finance local governments, particularly public schools, without a state income tax.
Higher values don’t always equate to higher taxes
The amount of property taxes a homeowner owes in a given year depends on the tax rates set by cities, counties and school districts where they live and the value of their home. But an increase in value doesn’t necessarily guarantee a dramatically larger tax bill, appraisers and property tax experts said.
State law also limits the taxable value of a home from rising more than 10% in a given year on an owner’s primary residence. While the median market value of a home can grow by 50%, the median taxable value of the same home can rise by 10% or less in high-growth areas that add new homes to the tax rolls.
That alone could drop city and county tax rates, or maybe not after Texas residents in May approved two propositions providing some relief in property tax bills. Proposition 1 essentially cuts school district property taxes for homeowners 65 and older or disabled; Proposition 2 raised the state’s homestead exemption from $25,000 to $40,000.
In 2019, the Texas Legislature passed House Bill 3, the $11.6 billion school finance bill that included $5.1 billion to lower school district taxes, added $6.5 billion in new school spending and set caps on school district tax rates. Senate Bill 2 required cities, counties and other taxing units to get voter approval before raising tax rates by 3.5% or more than the previous year.
Both bills, according to one study, had saved taxpayers $6 billion alone in 2021. But it didn’t mean they paid less in taxes. School tax rates dropped by 13% since both bills passed in 2019, but taxable property values rose by 23%, according to the study.
Meanwhile, state lawmakers are eyeing a $12 billion surplus in state revenue to pay for some public school costs so districts may lower their property tax rates. Texas is also suing the federal government for the right to use $3 billion in federal stimulus funds to pay for tax cuts.
Possible remedies ahead of 2023
Meanwhile, ideas like making the sales prices of properties public — which advocates say would ensure properties aren’t exorbitantly valued and that owners of expensive properties are paying their fair share of taxes — have gone nowhere.
Still, the CAD is willing to listen. This year, the number of residential property owners filing protests dwarfed those filed by agents of collected and commercial properties by a near 2-to-1 margin. While there are more protests, Booker said all is on track to reach the 95% required by state law to complete certifying values by July 25.
“The (CAD) has nothing that is holding up the scheduling process,” Interim Chief Appraiser Jeffrey Booker said. “When property owners come in for their hearings, they are, for the most part, very well prepared with their evidence and documentation.”
Booker said 1,880 protests have resulted in reduced valuations, compared to 471 unchanged, despite being short four staffers.
However, Colette Laine and husband Raul Flores, the owners of Comal County Coffee in Spring Branch and founders of Comal Property Guardians, claimed the CAD has limited taxpayers to present their evidence in the initial protest stages.
“When people show up for their informal hearings, they are showing up without the evidence packets,” Flores said. “The CAD is saying it’s only allowed at the formal (ARB) stage, which is not what the law says.”
Booker says the ARB sets the guidelines for the hearings, which are not limited to in-person appearances and conducted via phone and teleconference. Those dissatisfied with ARB decisions can file suit against the CAD in district court, or select one of two forms of binding arbitration, officials said.
Flores’ alleged the CAD is reversing appraisals without putting up much of a fight.
“It works out for those who don’t know (the rules) or can’t protest the appraisals, but it doesn’t work out for the rest of us,” he said. “It’s too bad for them and it’s almost like being guilty until proven innocent — which is not how to approach this.”
Flores said he and his wife’s protest hearing hasn’t been scheduled yet, but he vowed to attend Tuesday night’s board meeting and will continue to protest to even out inequities in the assessment process — some properties didn’t see any difference in assessed values between this year and last year, while other increases went up by as much as 500% to 700%.
If need be, Flores said he’ll extend the fight past the July 25 certification deadline.
“The CAD needs to be focused on the out-of-confidence issues,” he said.
Public outreach
The CAD’s latest additional taxing entities are the newly-approved Canyon Ranch Municipal Utility District and Comal County Water Improvement District No. 3. Booker said many taxpayers don’t seem as angry as they were two months ago — praising Larry Hermance, CAD taxpayer liaison officer and Kristen Hoyt, the tax assessor-collector and non-voting board member, who have joined CAD officials at neighborhood and homeowner association meetings to bring the public up to speed on assessments and market conditions.
As the CAD continues to wade through 2022 protests, on Tuesday, the board will consider the next budget, which will fund 2023 assessments.
“For 2021, the district approved budget was $4,104,308.47, and for 2022 the approved budget was $4,651,279.72.” Booker said. “For 2023 the proposed budget is $5,531,769.94.”
Booker said a public hearing will be conducted on that budget before a regular monthly meeting of the CAD board of directors. He said the agendas for both meetings, at CAD headquarters at 900 South Seguin Avenue in New Braunfels, will be posted by Friday.
The CAD has improved videoconferencing methods even though most protests have returned to in-person hearings before staffers and ARB members. More information is available at a link from its website to the “Truth In Taxation” website listed on notices to taxpayers.
The website includes information on tax rates, taxing jurisdictions and other details on valuations and assessments. For more, visit the CAD website, www.comalad.org.
The Texas Tribune and Associated Press contributed to this report.