Monday, June 16, 2014 by Beth Cortez-Neavel

Council holds off on appraisal petition, postpones action until 2015

The Austin City Council backed away from filing a challenge petition over the Travis Central Appraisal District’s commercial property valuation process early Friday, voting instead to postpone any action until 2015.

 

But Council members will not be sitting on their hands. Instead, they have assigned city staff to work with experts to figure out the best way possible to present a successful challenge next year.

 

Council members finished debating the issue as the clock neared 3:30 a.m. Friday.

 

The Travis County Commissioners Court was the first local governmental body to take on the issue of high residential appraisals and property tax rates. Last week, it too decided not to file an immediate petition but voted to create workgroups to further research Travis Central Appraisal District commercial and industrial property valuations, instead of filing a similar petition.

 

Council Member Kathie Tovo sponsored three resolutions that would approve filing a challenge petition, add issues surrounding property tax laws to the city legislative agenda and allow city staff to create an appraisal protest policy for companies receiving economic incentives from the city property tax protests.

 

The Council stayed on task late into the night, despite thunderstorms, a tornado warning and a plethora of zoning resolutions. At 2:30 a.m. Friday, the Council heard public testimony on all three appraisal resolutions lumped together. Although most of those who signed up to testify had already gone home, a few, like Travis County Commissioner candidate Brigid Shea, stayed and urged the Council to act.

 

“This broken appraisal system is clearly unconstitutional and needs to be challenged in court. So that is why the action before you today is so important. You need to challenge this with the appraisal review board before it can go to court. You’re checking the box,” she said.

 

Shea has been a driving force behind citizens pressuring local government to act on increasing property taxes. 

 

The Council voted unanimously to further research property tax issues and join with other municipalities around the state on creating an effective legislative agenda.

 

Instead of moving forward with the challenge petition within the next few weeks, Tovo suggested that the council wait until next year and build up a stronger petition case. The amended resolution passed unanimously.

 

“The intent is to make sure we are getting started right away,” Tovo said at the meeting. “We’re not backing off. We’re not moving forward as quickly as I, and many of you, would like on this particular issue. But I think we are going to move forward in a way that will allow us to be successful.”

 

The third resolution passed 5-2, with Mayor Lee Leffingwell and Council Member Bill Spelman voting no. The goal would be to disallow companies that receive tax breaks already from the city from protesting their appraisals and further reducing the money going to support services like parks and schools. About 90 percent of all companies protest their appraisals with TCAD each year. Nine companies have negotiated active economic contracts with the city, but there is no data yet on which of those companies may be protesting their appraisals. (This sentence has been corrected.)

 

Leffingwell would not elaborate on his position. Spelman said he would not vote for the resolution because there were not enough reasonable exceptions offered, other than clerical errors.

 

Tovo told the Monitor that she had some concerns over the discussion on the dais about what may constitute a reasonable exception for commercial properties that enter into incentive agreements with the city.

 

“What I don’t want to do is open it up to lots of loopholes, because frankly, we already have those built into our property tax system,” she said. “If we’re adopting a policy it has to have teeth.”

 

Tovo said the next steps in the city’s property tax agenda are to work together with the Commissioner’s Court workgroups, hire an expert to work with the city on next year’s petition, and begin looking at the scope of the challenge petition. City staff will give progress updates to the council and the public bimonthly, beginning in August.

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Key Players & Topics In This Article

Austin City Council: The Austin City Council is the body with legislative purview over the City of Austin. It offers policy direction, while the office of the City Manager implements administrative actions based on those policies. Until 2012, the body contained seven members, including the city's Mayor, all elected at-large. In 2012, City of Austin residents voted to change that system and now 10 members of the Council are elected based on geographic districts. The Mayor continues to be elected at-large.

property tax appraisal: The value of property as determined for use in assessing area property taxes.

Travis Central Appraisal District: The tax appraisal district for Travis County.

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