By: Bryant H.B. No. 4228
A BILL TO BE ENTITLED
AN ACT
relating to the system for appraising property for ad valorem tax
purposes.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 41.43, Tax Code, is amended by amending
Subsection (b) and adding Subsections (e), (f), (g), and (h) to read
as follows:
(b) 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:
(1) the appraisal ratio of the property is equal to or
less than the median level of appraisal of a reasonable and
representative sample of other properties in the appraisal
district;
(2) the appraisal ratio of the property is equal to or
less than the median level of appraisal of a sample of properties in
the appraisal district consisting of a reasonable number of other
properties similarly situated to, or of the same general kind or
character as, the property subject to the protest; or
(3) the appraisal ratio [appraised value] of the
property is equal to or less than the median appraisal ratio
[appraised value] of a reasonable number of comparable properties
in the appraisal district appropriately adjusted.
(e) For purposes of Subsection (b)(3):
(1) a determination that a property is comparable to
another property must be based on the similarity of the properties
with regard to the characteristics described by Section 23.013(d);
and
(2) calculation of the market value of the property
that is the subject of the protest or of a comparable property for
the purpose of determining the property's appraisal ratio must be
based on the appraised value of the property as shown in the
appraisal records submitted to the appraisal review board under
Section 25.22 or 25.23.
(f) If a reasonable number of comparable properties does not
exist in the appraisal district, the median appraisal ratio of a
reasonable number of comparable properties may, for purposes of
Subsection (b)(3), be calculated using comparable properties in
other parts of the state, in the following manner:
(1) an adjacent county or counties; or
(2) the rest of the state if a reasonable number of
comparable properties is not achieved though Subsection (f)(1).
(g) The comptroller by rule shall establish standards for
the development and calibration of adjustments made by the
appraisal review board in a protest under this section to the
appraised value of commercial, industrial, and multifamily
properties and other unique properties. The comptroller shall
review and, if necessary, update the standards established under
this subsection at least every other year.
(h) The chief appraiser may disclose confidential
information for the purpose of meeting the appraisal district's
burden of proof under this section if the information does not
identify:
(1) a specific property; or
(2) a property owner.
SECTION 2. Section 41.45, Tax Code, is amended by adding
Subsection (c-1)and (c-2) to read as follows:
(c-1) A property owner or a chief appraiser may offer as
evidence a third-party appraisal of a similar comparable property
or a third-party appraisal of the property that is the subject of a
protest at a hearing on the protest if the appraisal was completed
not more than 12 months from the appraisal date under Section
23.01(a).
(c-2) On request made to the appraisal review board before
the date of the hearing, a property owner shall provide the chief
appraiser with a copy of any available third-party appraisal of the
property that is subject of a protest if the appraisal was completed
not more than 12 months from the appraisal date under Section
23.01(a).
SECTION 3. Section 42.23, Tax Code, is amended by adding
Subsection (i)and (ii) to read as follows:
(i) A property owner or an appraisal district may offer as
evidence a third-party appraisal of the property that is the
subject of an appeal under this chapter if the appraisal was
completed not more than 12 months from the appraisal date under
Section 23.01(a).
(ii) On request made to the district judge before the date
of the hearing, a property owner shall provide the chief appraiser
with a copy of any available third-party appraisal of the property
that is subject of a protest if the appraisal was completed not more
than 12 months from the appraisal date under Section 23.01(a).
SECTION 4. Section 42.26, Tax Code, is amended by amending
Subsections (a) and (b) and adding Subsections (e), (f), (g), and
(h) to read as follows:
(a) The district court shall grant relief on the ground that
a property is appraised unequally if:
(1) the appraisal ratio of the property exceeds by at
least 10 percent the median level of appraisal of a reasonable and
representative sample of other properties in the appraisal
district;
(2) the appraisal ratio of the property exceeds by at
least 10 percent the median level of appraisal of a sample of
properties in the appraisal district consisting of a reasonable
number of other properties similarly situated to, or of the same
general kind or character as, the property subject to the appeal; or
(3) the appraisal ratio [appraised value] of the
property exceeds by at least 10 percent the median appraisal ratio
[appraised value] of a reasonable number of comparable properties
in the appraisal district appropriately adjusted.
(b) If a property owner is entitled to relief under
Subsection (a)(1), the court shall order the property's appraised
value changed to the value as calculated on the basis of the median
level of appraisal according to Subsection (a)(1). If a property
owner is entitled to relief under Subsection (a)(2), the court
shall order the property's appraised value changed to the value
calculated on the basis of the median level of appraisal according
to Subsection (a)(2). If a property owner is entitled to relief
under Subsection (a)(3), the court shall order the property's
appraised value changed to the value calculated on the basis of the
median appraisal ratio [appraised value] according to Subsection
(a)(3). If a property owner is entitled to relief under more than
one subdivision of Subsection (a), the court shall order the
property's appraised value changed to the value determined under
the subdivision under which the owner is entitled to relief that, in
the judgment of the court, reflects the most appropriate [results
in the lowest] appraised value. The court shall determine each
applicable median level of appraisal or median appraisal ratio
[appraised value] according to law, and is not required to adopt the
median level of appraisal or median appraisal ratio [appraised
value] proposed by a party to the appeal. [The court may not limit
or deny relief to the property owner entitled to relief under a
subdivision of Subsection (a) because the appraised value
determined according to another subdivision of Subsection (a)
results in a higher appraised value.]
(e) For purposes of Subsection (a)(3):
(1) a determination that a property is comparable to
another property must be based on the similarity of the properties
with regard to the characteristics described by Section 23.013(d);
and
(2) calculation of the market value of the property
that is the subject of the protest or of a comparable property for
the purpose of determining the property's appraisal ratio must be
based on the appraised value of the property as shown in the
appraisal roll certified by the chief appraiser under Section
26.01.
(f) If a reasonable number of comparable properties does not
exist in the appraisal district, the median appraisal ratio of a
reasonable number of comparable properties may, for purposes of
Subsection (a)(3), be calculated using comparable properties in
other parts of the state, in the following manner:
(1) an adjacent county or counties; or
(2) the rest of the state if a reasonable number of
comparable properties is not achieved though Subsection (f)(1).
(g) The comptroller by rule shall establish standards for
the development and calibration of adjustments made by the court
under this section to the appraised value of commercial,
industrial, and multifamily properties and other unique
properties. The comptroller shall review and, if necessary, update
the standards established under this subsection at least every
other year.
(h) The chief appraiser may disclose confidential
information for the purpose of meeting the appraisal district's
burden of proof under this section if the information does not
identify:
(1) a specific property; or
(2) a property owner.
SECTION 5. Section 42.29, Tax Code, is amended to read as
follows:
Sec. 42.29. ATTORNEY'S FEES. (a) A property owner may be
awarded reasonable attorney's fees in an amount authorized by this
section if the property owner [who] prevails:
(1) in an appeal to the court under Section 42.25 or
42.26 and the appraised value of the property as determined by the
court is less than 90 percent of the appraised value according to
the appraisal roll;
(2) [,] in an appeal to the court of a determination of
an appraisal review board on a motion filed under Section 25.25; [,]
or
(3) in an appeal to the court of a determination of an
appraisal review board of a protest of the denial in whole or in
part of an exemption under Section 11.17, 11.22, 11.23, 11.231, or
11.24 [may be awarded reasonable attorney's fees].
(b) Subject to Subsection (c), the [The] amount of the award
to a property owner may not exceed the greater of:
(1) $15,000; or
(2) 20 percent of the total amount by which the
property owner's tax liability is reduced as a result of the appeal.
(c) The [(b) Notwithstanding Subsection (a), the] amount of
an award of attorney's fees to a property owner may not exceed the
lesser of:
(1) $100,000; or
(2) the total amount by which the property owner's tax
liability is reduced as a result of the appeal.
(d) An appraisal district may be awarded reasonable
attorney's fees in an amount not to exceed $100,000 if the district
prevails in an appeal to the court under Section 42.25 or 42.26 and
the appraised value of the property as determined by the court is at
least 10 percent greater than the appraised value according to the
appraisal roll.
SECTION 6. Sections 41.43 and 41.45, Tax Code, as amended by
this Act, apply only to a protest under Chapter 41, Tax Code, for
which a notice of protest is filed on or after the effective date of
this Act. A protest under Chapter 41, Tax Code, for which a notice
of protest was filed before the effective date of this Act is
governed by the law in effect on the date the notice of protest was
filed, and the former law is continued in effect for that purpose.
SECTION 7. Sections 42.23, 42.26, and 42.29, Tax Code, as
amended by this Act, apply only to an appeal under Chapter 42, Tax
Code, for which a petition for review is filed on or after the
effective date of this Act. An appeal under Chapter 42, Tax Code,
for which a petition for review was filed before the effective date
of this Act is governed by the law in effect on the date the petition
for review was filed, and the former law is continued in effect for
that purpose.
SECTION 8. This Act takes effect January 1, 2024.