Texas Senate Bill SB1644

Texas 2021 - 87th Regular

Caption

Relating to the determination of the market value of property for ad valorem tax purposes.

Impact

The implications of SB1644 are significant for both commercial property owners and appraisers across Texas. By establishing clear guidelines on the methods of appraisal allowed, the bill aims to maintain consistency in property tax evaluations, potentially reducing disputes over property valuations. This change may impact municipalities reliant on property taxes, as differing appraisal methods can lead to fluctuating revenue levels based on property evaluations.

Summary

Senate Bill 1644 focuses on the regulations surrounding the determination of market value for ad valorem tax purposes. The bill amends the Tax Code to clarify the methods used for appraising commercial real property. Notably, it prohibits the use of the income method of appraisal for determining the market value of commercial properties, mandating the use of cost and market data comparison methods while ensuring a standardized approach in valuation procedures.

Contention

While proponents argue that the bill enhances clarity and prevents discrepancies in property tax assessments, critics may contend that the exclusion of the income method could undermine accurate valuations for certain commercial properties whose values are intrinsically tied to income generation. This point has raised concerns among various stakeholders, who argue that it may not reflect the true market conditions effectively.