Every year, county appraisal districts mail notices of appraised value changes to millions of property owners across the state which prompts protests by unhappy taxpayers.
Even with fewer values than usual increasing in Galveston County this year, hundreds of property owners attended classes to learn how to be effective in the protest process. I know because I taught those classes and attendees confirmed what seems to me to be obvious -- the system needs to be changed.
In 2006, the Governor's Task Force on Appraisal Reform traveled the state collecting information on problems associated with our current property tax system. Today, interim committees in both the Senate and House are studying the same issues. Why? Because many property owners are still mad (even after enormous reductions in school district tax rates) because their values increased and it became apparent that savings would be temporary at best. Sadly, few are willing to take a leadership position in order to establish a permanent remedy -- it is easier to study and debate the issue than it is to correct it.
What a waste of time and money -- their time, our money.
The solution is simple -- adopt a property tax system based on acquisition rather than market value. Starting with current values as a base, values would change when sold to the sale price. To provide for inflation (or recession), values could increase (or decrease) annually based on the rate of inflation (or recession) or 2 percent, whichever is less. The limit should not apply in certain circumstances, such as when additions are made to properties or in the event of catastrophic losses.
Seniors and the disabled must be allowed to retain their current tax benefits and, in the interest of maintaining community stability, families should be allowed to transfer their homestead property to heirs without a change in base value (as long as it remains a homestead).
The result? Taxpayers are no longer angry each spring because appraisal notices will not be arriving in the mail. Legislators stop hearing complaints from constituents and can finally get on with important state policy decisions.
Fiscally, in excess of $300 million paid by local governments to fund appraisal districts will no longer be needed. The Comptroller's Property Value Division would no longer be conducting ratio studies and school districts would cease spending thousands of dollars defending failed ratio studies. The result? Less government and lower taxes.
Is an acquisition value system fair, uniform, and Constitutional? Yes. It provides predictability for property owners, increases community stability, and everyone is treated equally (after the initial assessment at the time the law takes effect). The U.S. Supreme Court in Nordlinger v. Hahn, 505 U.S. 1 (1992) presents compelling arguments to support the constitutionality of an acquisition value tax system.
Statewide, voters overwhelmingly support changing our current system and the time has come for permanent and sustainable change. Let's solve the problem instead of placing yet another temporary Band-Aid on a gapping wound. We deserve a better system than the one we have today. We have been taxed into awareness and we want solutions now.
-- Cheryl E. Johnson is the Galveston County tax assessor and collector.
Comments
Posted by Dinner_4_2 on June 22, 2008 at 6:22 a.m. (Suggest removal)
Why should seniors get to retain current values? This is not to put down seniors, hec I'm getting closer to being one every day. My point is,just because my property values went up doesn't mean that my income has also. Maybe if their values went up right along with everybody elses,they would join the rest of us who oppose higher taxes. By saying they are exempt, they will keep quiet.
Posted by squid on June 22, 2008 at 6:51 a.m. (Suggest removal)
How many seniors see significant increases in their income each year? After paying their fair share for 40-50 years, I have no problem with them getting a break in 'the golden years'...
Posted by ropers40 on June 22, 2008 at 9:08 a.m. (Suggest removal)
What is funny to me is how peoples home are never paid for. I was shocked after my home paid off and I found out that I still have to budget nearly half of what my payment was just to cover the taxes and insurance. I understand we pay taxes to keep the city running and insurance to keep insurance companies rolling in money.
Now think about this we also pay gas tax, phone tax, cell tax, sales tax, water tax, electrical tax, tax on the interest our money has made, tax on our license, tax on fishing, it goes on and on.
I wonder if there has ever been a study done to show exactly what Texans pay in a years time just in hidden taxes.
Posted by marb28 on June 22, 2008 at 11:53 a.m. (Suggest removal)
If I read this article correctly, the property tax would be tied to the acquisition price and would stay there until the property was sold. This would work for many of us whose property values keep going up while our incomes go down. We are senior citizens and have been hard pressed to pay our property taxes. Our house is ten years old, mortgage paid off. The value has gone up over 22% in these ten years.
Posted by Dinner_4_2 on June 22, 2008 at 4:10 p.m. (Suggest removal)
squid,
You completley missed the point. I have no problem with the seniors as a group. If they were taxed, you can bet they would be hollering up a storm. And thats what needs to be happening. Someone at city hall or wherever our tax money goes would hear this hollering loud and clear and maybe, just maybe they might be a little more reluctent about raising taxes on everyone. Get it now?
Posted by squib_kick on June 22, 2008 at 4:26 p.m. (Suggest removal)
Seniors get enough breaks already. Equal taxation for everyone. Higher taxes for any home valued over 200K.
Posted by hatestheramps on June 22, 2008 at 4:58 p.m. (Suggest removal)
The State Law says taxes are based on MARKET VALUE, or as close to it as the Appraisal Districts can determine. It taxes are too high, the elected officials need to lower the tax RATES. The value of a property is what the market says it is. Write your city councilmen, school board members, and county commissioners and tell them to lower the tax rates. Leave property values alone. They are not the problem. The unsatiable appetite of elected officials for more tax money is the problem. The formula proposed by the lady in this article would cause nothing but more problems for taxpayers and complicate the procedure where no one could understand it.
Posted by wild_bill on June 22, 2008 at 6:55 p.m. (Suggest removal)
hatestheramps it should be a lot easier to change one law, than to get every elected offical to lower rates all over the state.
I like Ms Johnson's idea to change the one law and save all of us tax monies. No appraisers or bureaucrats needed (that would save a TON of money right there!). It's be like a sales tax in a way. The taxable value doesn't change until the property is sold. Then THAT buyer has the valuation stay the same until it's sold again. Property with a high-turn-over rate will generate plenty of property tax revenue. Places that stay in the same hands for years, decades or generations would retain a much lower value, until improved or sold. What's to dislike about that?
Posted by reaganite on June 22, 2008 at 7 p.m. (Suggest removal)
squib_kick
"Equal taxation for everyone."
Great idea!
"Higher taxes for any home valued over 200K."
And how is that "Equal taxation for everyone." ?
Posted by adams77331 on June 22, 2008 at 7:37 p.m. (Suggest removal)
I'd like to make a couple of points.
1. A key ingredient to accurate mass property appraisal is having adequate sales information. Appraisal districts are expected to perform according to state law, and comptroller review, without all of the necessary components. We need mandatory sales disclosure for all types of properties. Most people are angered at the large increases, increases that could have been spread evenly over time, given adequate sales data. Low to medium value homes are easy to appraise, high value residences and commercial property are not. The wealthy, businesses, and realtors are the only ones that benefit from non-disclosure of sales. Most states whose local taxes are derived from the ad valorum tax system have mandatory disclosure.
2. Reducing property taxes will not solve a thing. Taxing units need a certain level of tax revenue to operate. If not from property taxes, then revenue will come from somewhere else. Income tax, or another form of taxation. Property taxes are the fairest way to distribute the burden according to what you own/are worth.
3. Senior citizen doesn't equal disadvantaged. Every break that is given to a select group shifts that burden to all of those that don't. Every break that is devised to help a few, is exploited.
4. Tax Assesor/Collectors seem to voice their opinions quite often, but are the least informed about the reality of the Texas property tax system. Remember that they are elected and have a very strong motive to say whatever is appeasing to citizens. I do not personally know Ms. Johnson, but the California property tax system is not a solution for Texas. If you like that system, get ready for a state income tax.
Posted by squid on June 23, 2008 at 5:53 a.m. (Suggest removal)
dinner 42, I guess you missed my point too. Aint worth arguing about though.......
Posted by Tumbleweed on June 23, 2008 at 9:39 a.m. (Suggest removal)
Eliminate all taxes currently n place and implement a new flat tax to cover all federal requirements. A percentage; let’s say 10% to start. If you make $1 you pay 10 cents, if you make $1,000,000 you pay $100,000. No deductions no business expenses, none of that. Everything is based on the gross.
For state expenses a sales tax that's included into the cost of the goods. So, when you went to the store and the item is priced at $9.99 its $9.99 not $10something.
The percentages would be delved out per person, obviously there are more people in Abilene than Clyde, but the city, county and state leaders would have to live within the budget.
Hmmm imagine that government spending directed by the people for the people.
Posted by rsjz4 on June 23, 2008 at 10:16 a.m. (Suggest removal)
ropers, I read a report one time that states we pay at least 50% of our income in taxes. That includes all the things you named above.
My family and I went to the metroplex and stayed in a hotel. The hotel tax was 13%! The same thing in Oklahoma last year.
Posted by Abilene_Libertarian on June 25, 2008 at 12:54 a.m. (Suggest removal)
Property taxes are like a sales tax on something you are not selling.
Every year!
Property taxes allow the local government to keep it's foot in the door, in case you fail to pay the ransom. To agree to an annual payment for what should be yours free and clear is an admission that you never really own any land. The Government just lets you use it until you miss a tax payment.
We need another way to finance legitimate government expenses.
I don't know what that may be, Any ideas?
Posted by mlthmsn on June 25, 2008 at 6:25 a.m. (Suggest removal)
First step is normally TAR and FEATHERS
I like the flat tax idea best.
Posted by mlthmsn on June 25, 2008 at 6:33 a.m. (Suggest removal)
Maybe a flat rate sales tax applied to everything except groceries. and then a flat income tax added to those who make over $250,000/yr (got to be sure to exclude me from that tax) oops is my right wing showing?
Posted by jscottkemp on June 25, 2008 at 4:04 p.m. (Suggest removal)
Consider the fair tax - do away with the IRS, ad valorem taxes, all other forms of taxation. And put a 23% sales tax on the retail sale of everything. ~23% is what we pay anyway, and this way we would all feel the pinch the same way every time we bought something...which would encourage us all to watch very closely the way the government spends OUR money.
I think it is a great idea. No, I think it is a fair idea.
Posted by wild_bill on June 25, 2008 at 9:46 p.m. (Suggest removal)
Good point Steve. I never thought of it that way, but I should have.
Posted by DontCensorKonstantin4Abilene on June 27, 2008 at 7:47 a.m. (Suggest removal)
Mr Konstantin, former candidate for mayor, would like to comment about this. Problem is the un-American editors at the Abilene Roprter News will not let him. The newspaper is denying his right to the same freedom of speech they enjoy. I don't know much about taxes, and can't remeber all he told me about this. Write the editor and demand an end to censorship. This is the USA, not Nazi Germany, Cuba, or Red China!
Posted by M1 on June 27, 2008 at 9:18 a.m. (Suggest removal)
Use of actual sales figures could greatly reduce the problem of over and under appraisals as the basis for property tax. Even this however would be subject to manipulation.
A potential property purchaser could pay 50-75% of the true market price on the sales contract but then funnel the remainder to the seller in some other way. In a severely down housing market taxes would not decrease at same rate as the market. A person keeping their home would over pay.
Transferring property to a family member without setting a new market price would set in place a fundamentally unfair dynastic system. Wealthy individuals could avoid taxes for generations simply by transferring their holdings to infinity. With the possible exception of a surviving spouse, a market appraisal should be done whenever such a transfer without cash takes place to re-set the property to market value.
Mandatory reporting of ALL sales figures would be vital to this type of system. If commercial and high-end brokers don't want to do this then perhaps this new system should be limited to Homestead properties only.
Posted by Abilene_Libertarian on June 28, 2008 at 3:18 p.m. (Suggest removal)
Ron Konstantine's comments have been blocked from the rest of us. I know this to be true.
The ARN has the right to refuse publication, but why with RonKon, when there are so many better candidates for TOS violation?
Sure, some of his rants may seem out in left field, but there are other posters who seem to exist for the singular purpose of running down other posters.
Posted by wild_bill on June 29, 2008 at 8:37 p.m. (Suggest removal)
A newspaper should be equally diligent in protecting the First Ammendment rights of their readers as itself. Personally I would not mind if I never saw another of RonKon's postings but my rights to post are no greater than his. If I fail to try and protect his rights, who will protect mine? I don't agree with a lot of RonKon's postings but to my knowledge he was never profane, obscene or threatening. I don't know though if the First Ammendment protection extends to these forums. I know it does not on most game sites since they are private companies. Any of you legal eagles have any ideas on this?
DCK4A, can you ask him what he did? Surely he was provided with an explaination of WHY he has been perma-banned from the forum.
ABILENE, TX - Shortly after 5:30 p.m. Monday evening, a fire was reported in a large warehouse building located in the 400 block of Plum Street, east of downtown Abilene.
