The Appraisal Review Board is now accepting applications. If you have the time to commit to serving, please consider doing so. This might just be one of the best ways those tired of the tyranny and corruption of HCAD can affect change, by taking over the ARB and overturning unfair HCAD property tax assessments.
The HCAD Wall of Shame began in the summer of 2012, as an outlet for my frustration with my ARB hearing that year. The saga of my fight with HCAD has finally come to an end. A recap of the saga is as follows:
After several years of successfully convincing ARB panels that HCAD’s “extensive remodel” label on my home was in error, I came across three biased and stupid people who refused to listen to or look at the evidence I provided, and even went so far as defend the CAD representative when he made a bald-faced lie and claimed that a comparable property I presented was not in my neighborhood (not only had the owner and I served on the same HOA board, the neighborhood number on his and my properties is the same in HCAD’s records).
I continued to fight the next year, this time aided by George Scott and John Osenbaugh, failing spectacularly as yet another ARB upheld the “extensive remodel” label, violating Texas Tax Code Section 41.43(a) and refusing to acknowledge John Osenbaugh’s expert testimony. And again, of course, another HCAD representative, Joel Fischer, lied under oath, claiming that an HCAD employee visited my property to determine the remodel condition. In fact, a later Texas Open Records Act demand revealed that no HCAD representative had visited my property, HCAD had made the “extensive remodel” determination SOLELY on overblown glossy verbiage the seller’s agent had included in the listing for the house back in 2006. Kelly Sherbert, an employee of HCAD who answers to HCAD Chief Appraiser Sands Steifer even though she does the work of Taxpayer Liaison Officer Teresa Terry, who rarely actually comes to work, provided me this information, as she was legally required to do, but then refused to discuss it with me further.
Ultimately, this lead to HCAD sending two employees out to inspect my property, who, under the watchful eyes of John Osenbaugh and my lawyer Fred Cull, conceded that my house was NOT extensively remodeled. In the meantime, I had filed a lawsuit against HCAD, and in light of this new evidence, HCAD offered a fairly reasonable settlement offer, which I took, and at the same time John Osenbaugh was able to use this new information to fight my 2014 assessment and get it down to a reasonable number too. So, I have prevailed, but not without a lot of work on my part and the excellent work of John Osenbaugh and Fred Cull, and the invaluable guidance and moral support of George Scott. My thanks to all three of these fine gentlemen.
So I hope this will provide some encouragement to the rest of you out there who have similarly been trampled on by HCAD and are either in the process of fighting or wonder if it is worth it to fight. It is. Though my saga is over, The HCAD Wall of Shame will continue on. I will always be vigilant of my assessment every year, and will do the homework and see if it is fair and equal and reasonable, and if not, will fight it. I will also continue to post your stories as well as news stories that relate to property taxes in Harris County, so please keep your stories coming.
Usually I restrict this blog to complaints about HCAD and its sleazy tactics, but occasionally, as I did for the Astrodome referendum last year, I will weigh in on issues that affect the property owner-taxpayers of Harris County. Since at least part of Katy ISD is in Harris County, the issue of the Katy Bond vote yesterday does affect some taxpayers in western Harris County. I don’t live in the Katy ISD boundaries, so I am not personally affected by this, but still I find it despicable what Katy ISD did.
Last year taxpayers spoke their minds and Katy’s stadium bond ballot initiative failed on its own merits, so what do they do this year? They wrapped a somewhat reduced $58 million dollar stadium plan into a larger $748 million bond package that would also pay for much needed new school construction. Katy ignored the wishes of many in the district that put up two bonds to vote, one for the stadium and one for everything else; of course they did, because they knew the stadium would fail again if they did. So instead they gave voters a Sophie’s Choice – “if you want new schools, you will pay for a new stadium, whether you want it or not.”
I am a big fan of public schools, a product of them myself, my wife works in the public schools, and my children go to them. I know the financial bind that many districts are put in by the terrible school finance situation in this state. My property taxes have gone up $1,000 a year for the past three years, and supposedly some of that extra money goes to the schools, who are always talking about how needy they are, struggling to pay for academic costs. But every time I see a school district spend millions of dollars on a non-academic, non-essential item like a sports stadium, my sympathy for schools’ plight erodes a little more. It erodes when I hear that on average a school district spends four times more on a football player or a cheerleader than it does on a math student. And make no mistake about it, even when a district uses bonds to pay for a stadium, ultimately it is taxpayers’ money that pays for that stadium, because a bond is debt, loaned to the district by the people who buy that bond, and who expect to be paid back – with interest, and taxpayer dollars are what is used to pay them back.
In an era where cold, hard facts have debunked the lie that sports stadiums are big money makers for cities, the NCAA itself has found that D-1 sports programs are not the money makers coaches and boosters claim they are, and high school football programs are very rarely profitable, when you take into account the salaries of the coaches for sports that play in those stadiums, equipment for the student athletes who play in those stadiums, annual maintenance, utilities, etc, and the lost opportunity to sell the land the stadium is on to people or businesses who would pay property taxes on that land, it makes no sense whatsoever for districts to be paying more for bigger and better stadiums.
It’s a simple as this: the purpose of public education is academics. Schools should NEVER go into debt to pay for non-academic activities like sports, and as we learn more about concussions from contact sports and their long-term effects, and the particular vulnerability of young people, it is becoming more and more clear that sponsoring sports which scramble the brains of young people is incompatible with schools’ stated mission to improve the minds of young people. Extorting money from taxpayers to pay for bread and circuses, huge stadiums where parents can watch their children slam their heads into each other, it is unconscionable.
Maria wished to share her feelings on HCAD in general:
I am not posting a specific complaint comment at this time. My list of complaints and associated document file are too voluminous to describe. Complaining make us feel somewhat better but nothing will change unless we develop a broad movement of Harris County homeowners with the specific objective of scrapping the current system of market value appraisal altogether in order to institute a logical and fair property appraising program. The current method for HCAD’s estimation of market value is not logical (no rational system would evaluate market value of existing homes de novo every year resulting on yearly increases of 20 % or more and well beyond what the properties could sell for so HCAD can appraise and tax a home at the maximum 10% cap), not fair (riddle with unequal treatment), overflowing with conflict of interest (on the part of the taxing authority and the presumably independent Appraisal Board) and inconsiderate of the taxpayers’ time and money (as attested by full rooms during tax-contesting season year after year with homeowners attempting to demonstrate unreasonable market value appraisals of their properties). We homeowners have to realize that this is so not by accident but by design and that, therefore, it is impossible to repair. When I describe HCAD rules and procedures and my experiences to friends who own homes in other states they don’t want to believe me and think I am joking. Incidentally, Harris County is not alone (please see: http://aaronlayman.com/2014/09/license-to-loot-how-texas-central-appraisal-districts-can-railroad-homeowners-with-near-impunity/), so this is wider problem. Again, without a broad-based homeowners organization and action to change market value appraising methods and procedures this will continue. It has been so for many years despite any changes the legislature has made in their attempts to address Texas tax appraisals.
I prefer to withhold my last name at this time but would gladly join a citizens organization with the objectives I formulated above.
A new complaint from George:
New transplanted Houston homeowner here and my first experience with HCAD is almost identical — bought my house last year because I was transferred from out of state. We didn’t have the benefit to wait and shop — we knew what we wanted and we’re happy with our house but bought it at a premium with similar quick-and-dirty “remodeling” (Granite counter tops, cheap hardware, etc.) that we knew we were going to replace anyway to bring a midcentury back to its roots. A few months later other issues came up (our cast iron plumbing is near the end of its useful life, foundation issues due to dought, fence is falling apart). When we bought it, the tax appraisal was at $119k, we bought it at the $150k premium knowing that we would have to pay about $30k to get rid of the cosmetic “upgrades” and really bring it to market value. Meanwhile, investors have been buying larger houses in our neighborhood with improvements such a pools, garages, extra living space, have been flipped on the market. No serious remodeling work has been done on my house; original 50 year old electrical system, plumbing, and windows are not to code, we are probably the only house in our neighborhood without a garage — yet my property is being valued against these other houses that have been remodeled at least once in the past 5-15 years.
I got my appraisal notice earlier this year, and they assessed the property at $166k — a nearly 40% increase — $47k more than the previous year. At the informal meeting, they lowest they would go would be the price that I paid for the house last year. I argued that now that we know about the foundation and plumbing issues, there no way we can sell it at the price we bought it if we disclosed that information as required by law. He didn’t even bother looking at my pictures or the print outs I made of recently sold houses in my neighborhood. He said that he couldn’t appraise the house at anything lower than market price, and the best that would be would the price i paid for it last year.
I go home and decided to do more research…. I checked on the appraised values of my neighbors who have houses that are at least 500 sq. feet larger than mine, larger lots, garages, and they are being appraised at a nearly $40,000 less than the market price; at less than $65 per square foot — my house is appraised at nearly $85 per square foot. I went further and retrieved all the data for my subdivision and ran a simple statistical analysis — the median appraisal is around $70 per square foot.
While I can’t say anything about the affluence/race issue, from the way I was treated, I assume their marching orders are to take advantage of new homeowners — I don’t understand how I can be taxed at a rate significantly more than my neighbors and against houses that are not really comparable…
George, it sounds like you might be a victim of Unequal Appraisal. Under Section 41.43 of the Texas Property Tax Code:
“a protest on the ground of unequal appraisal of property shall be determined in favor of the protesting party unless the appraisal district establishes that…the appraised value of the property is equal to or less than the median appraised value of a reasonable number of comparable properties appropriately adjusted.”
In order for a property to be comparable, it usually should be in your subdivision or at least in your nearby area, and be similar in size, age, and improvements, including remodel. What constitutes a reasonable number of comparables is usually at least two that support your argument for reduction. If you are that far above the median value per square foot, you are not being equitably assessed, and should take the information you have compiled to your ARB hearing. Please keep me updated on your fight.
From Andy, who just had his informal hearing:
Thank you for making this forum available — I feel alone in this, but I know that my neighborhood is being systematically targeted by HCAD for large increases in property value that are unjustified and unsustainable.
I met with my HCAD agent yesterday, Zachary Taylor, which was rather like talking to the wall — he was disruptive, and disorganized everything I was trying to tell him. He completely disregarded any information I presented, instead comparing my house to “very good” or “excellent” condition houses, that mostly are not even in my subdivision. There are a few new houses on the fringes of my neighborhood that fit this description, but mine is 40 years old and squarely fits the “average” description — but he would not listen, even though every house on my block is listed as average.
For some reason, the previous occupants whom had a tendency to exaggerate everything they did, considered their house the best on the block. They did a kitchen remodel, and put in granite countertops and a cheap Chinese made faucet that they mail-ordered. The cabinets are made out of pine plywood. I showed HCAD this, and they would not listen, instead they compared top end houses that had a remodel done, and how much it affected their value. The people who lived in my house before me were neurotic idiots with no sense of style at all. If they really paid for remodeling, someone had to have been laughing at them all the way from the lumberyard. It surely doesn’t justify a 21% markup in the purchase price of my house which I bought last year because someone put in some plywood cabinets, that aren’t even finished or painted.
The whole point of all of this is that Zachary’s job was to discourage me and discredit everything I said. He did not inform me of my rights, even when I asked him. I informed him I must submit an appraisal, but I was not given the opportunity to do so. Furthermore, the notice that I got for the hearing was dated July 14 was only 14 days from the date of my hearing on the 28th of July. This was then mailed and received the next week, so I could not have known to get an appraisal and submit it in the withing the 14 day time limit called out in Section 41.43. Zachary completely ignored me about this, and said that I needed to schedule a formal hearing. I then said, only if the date selected allows me adequate time to get an appraisal done. He kept ignoring me.
Zachary was doing his job, to make me discouraged. He has instead, out of principle, made me very angry and eager to make it known the way I was treated. They need to hire people that do not suffer from ADHD, or at least it appears so based on the way he was acting. His number one cop-out that he repeated several times was that “he didn’t have the authority to do anything” — if so, why am I even there talking to you???
I am determined to study the tax data for my neighborhood, and compare this to those of surrounding neighborhoods. I am fairly sure that my neighborhood is being targeted because demographically it is 3/4 white, and we are “rich” and should pay — which is far from the truth. My house is 40 years old with a leaky roof and old iron pipes — this is not on par with new construction.
With any luck, unequal increases to my neighborhood as a whole will show that we are all subject to unequal appraisal, and so are injured taxpayers — which then allows a class-action suit could be made. But, all of that remains to be seen. I may need to wait to be “injured” before I can get fair, non-runaway, appraisals for my property it would seem. I hate the prospect of going to court over this, but it seems to be what they think they can get away with that makes me want to go.
Andy, thanks for sharing your frustration with me, I hear your pain and feel it too. You are probably right, your neighborhood is probably being systematically targeted. I know mine is, HCAD’s lawyers (Olson & Olson) pretty much told my lawyer that my neighborhood was being targeted, which is why they weren’t willing to accept our very reasonable counteroffer. My lawyer explained that HCAD is taking so much heat from the Harris County Commissioners Court for their mishandling of high dollar commercial properties, that they are taking it out on residential property owners. Your story somewhat mirrors mine – the previous owners of your house did some really superficial upgrades here and there and probably put some exaggerated gloss in their HAR listing about “extensive upgrades” and HCAD used that verbiage to justify raising the condition of the house. In my case, HCAD listed my house as “extensively remodeled” because of it. I was finally able to get that fixed (somewhat) by emailing firstname.lastname@example.org and demanding to know, under the Texas Open Records Act, the name of the person at HCAD who had listed my home as extensively remodeled, on what date they had made that determination, and what method they used to make that determination (ie, did they actually make a site visit, did they actually go inside the house, etc). That told me that a “valuation specialist” had decided my home was “extensively remodeled” in 2006 based entirely on the HAR listing, which was grossly exaggerated. So I demanded that HCAD send someone out to do a real appraisal, and I had my tax agent there for the site vsit to make sure they didn’t ignore important defects that affected value, or try to lie about the quality of something. My tax agent is John Osenbaugh if you want a good recommendation. In your case, you may just want to get your independent appraisal, and ask him if he would also come out when the HCAD appraisers do, and point out to him things he sees that lower the value. Good luck!
I have a question about the valuation date for the property taxes. Everywhere I see a date on the HCAD website it says that the market value is the value of the property at Jan 1. I interpret this to mean that my market value, derived by HCAD, is based off information prior and up to Jan 1.
My hearing for my 2014 property taxes was last week. The first comp they used to derive my market value had a sale date of 1/9/2014. This seemed strange to me because every date I have seen references Jan 1. I asked the HCAD representative why this comp was included and his response was that HCAD can use sale dates up to Jan 31 (seems like the website should say that). Then during his presentation of evidence, he brought up sales from 5/31/14 as evidence to support his value. The 5/31/14 sale will be included for 2015 and should not have any impact on my 2014 value. So the majority of HCAD’s evidence to justify my 2014 market value is based on information that should not be used until 2015.
Does anyone know if they are allowed to use dates that are after Jan 1 to justify their market values? I don’t have all the rules to this game memorized, but this just seemed like they were playing dirty.
Colton, yes, everything I have read says that the value must be that of January 1. Whether there is some grace period of the entire month of January or not, it is obvious that a sale on May 31, 2014, about 2 months after your valuation notice was sent out, should not have been allowed. However, as you have found, and I have also experienced, HCAD appraisers routinely lie under oath in ARB meetings, and unfortunately, in the last two or three years, ARB panels have just become yes-men for HCAD, I have personally experienced them blatantly violating the state tax code in making their decisions.