Harris County Appraisal District’s Budget
Skyrocketing commercial property values have led to costly court battles for the Harris County Appraisal District, prompting its leaders to propose increasing its budget to nearly $65 million next year.
If approved by the district’s board of directors next week, the budget will have increased 35 percent from a comparatively modest $48 million just last year.
News of yet another increase prompted calls for belt-tightening from officials at the Houston Independent School District, which funds a portion of the appraisal district’s budget along with about 900 other taxing jurisdictions whose property values are set by its appraisers. The school district’s bill would increase more than $1 million to about $10 million under the proposed budget.
“It’s quite a chunk of change for us,” said Melinda Garrett, the school district’s chief financial officer. “It’s taking $1 million out of our classrooms.”
Chief appraiser Jim Robinson said he has little choice but to ask for more money as the number of lawsuits filed by unhappy property owners increases yearly, and the state comptroller continues to fight for even higher commercial property appraisals.
“Certainly, I appreciate their concerns. The jurisdictions have to pay the bill. But, by that same token, we have to do what the law requires us to do,” Robinson said Tuesday.
Commercial property values in Harris County increased an average of 34 percent this year â€” from about $981,000 to a little more than $1.3 million â€” the highest one-year increase in at least a decade, according to Tax Assessor-Collector Paul Bettencourt. Ten ZIP codes, including all of downtown Houston, saw average appraisal increases of more than 50 percent.
That led to a record 350,000 protests from commercial, apartment and residential property owners.
More than 333,000 protests were filed last year, leading to about 3,500 lawsuits from owners who were not satisfied with the results of an Appraisal Review Board hearing.
At least a dozen of those lawsuits will involve significant litigation expenses, Robinson said. For example, fighting one company over one year’s appraisal for its downtown Houston office building already has cost the district $400,000.
“You either try the lawsuits or you settle them and give the people that brought them an unfair tax break,” Robinson said, adding the number of lawsuits filed increased 70 percent from 2005 to 2006 and another 60 percent the following year.
Robinson trimmed $2 million from the budget proposal he submitted to the board of directors in June by recommending that less complicated lawsuits be handled in-house.
Bettencourt, a member of HCAD’s board of directors, applauded that move, but said he thinks the legal expenses still are too high. He said he has been told by tax consulting firms that fewer lawsuits will be filed this year because property owners also are feeling the pinch of expensive litigation.
But Mary Van Kerrebrook, an attorney who represents the owners of commercial properties ranging from apartments to shopping malls, said she expects the number of lawsuits to remain steady or increase slightly as Texas Comptroller Susan Combs continues pushing for higher property values.
Van Kerrebrook said tax agents have told her that the appraisal review boards seem to be under pressure to keep values high this year.
Robinson said the amount of money budgeted for legal expenses could be reduced by settlement negotiations in several major cases.
Chronicle reporter Jennifer Radcliffe contributed to this report.