Momentum - Business to Business Online Magazine MOMENTUM May 2019 | Page 24

CHERYL E. JOHNSON, PCC Galveston Co. Tax Assessor Collector [email protected] Changes to Binding Arbitration An Option to Lower Property Value L ast April I provided in depth information on Binding Arbitration – a previously little discussed option when unhappy with how your informal conference with a CAD appraiser ➝ Appraisal Review Board (ARB) Panel Hearing ➝ turned out. It is a bit complex and I suggest taking a professional with you. It is less costly and likely less stressful than filing a lawsuit in District Court (although if you have an attorney in the family, a lawsuit is a very effective option). Binding arbitration is gaining popularity due to the perception that Appraisal Review Boards are not impartial. I agree they may not be – after all, they spend the summer with the CAD staff and come to trust them and they see you once every few years! In binding arbitration, an impartial, independent third party (the arbitrator) hears and examines the facts from both the property owner and CAD then makes a decision that is binding on both. It works like this for 2018 arbitrations forward (earlier cases were governed by different Comptroller rules): • The ARB will provide an ‘order of determination’ after the formal hearing. If the disputed value does not exceed $5M (except for residence homesteads for which there is no limit), the taxes have been paid, you have not filed a lawsuit, and the request is timely and properly filed, you are eligible for this option (assuming the dispute pertains to value not denial of an exemption, etc.). • A request for arbitration form, along with a money order or cashier's check made payable to the Comptroller of Public Accounts (fees range from $450 to $1,550 depending upon the value and property type) may be delivered to mailed to the CAD or filed online through the Texas Comptroller Online Arbitration Center within 45 days of the ARB order. If a paper request, the CAD must certify the application and forward it, the payment and ARB order to the Comptroller within 10 days. • The Comptroller may deny the request (if it fails to meet the listed requirements), accept it as submitted or request additional information of the owner, agent or appraisal district. Both the CAD and owner will have 45 days from the date of the Comptroller’s notice to accept the arbitration to “cure” the dispute and withdraw it. All but the $50 administrative fee will be refunded. • After 45 days, the Comptroller will appoint an individual from its Registry of Arbitrators, selecting one who principally resides in the county where the 22 MOMENTUM property is located. If all arbitrators refuse the case, the Comptroller may appoint an arbitrator one from another county. • The selected arbitrator will contact you to set it up which could be in person, by teleconference or via written documentation (both you and the CAD must agree to submission of documents). A property owner from Friendswood requested that his arbitration hearing be held at the local library although the CAD wanted a teleconference. Make some suggestions to the arbitrator that are agreeable to you and at locations where you are comfortable. The CAD had the upper hand with the ARB hearing so the location should be decided by you. • The arbitrator is required to provide a set of procedures that will be used in the proceedings. You will present your case and the CAD will present the ARB case. Time constraints in an arbitration are not as restrictive as in the ARB so take your time and lay out the entire case. Bring evidence and explain why your value is more appropriate. You may hire a property tax consultant, real estate broker or agent, attorney, appraiser or CPA to attend the hearing with you or on your behalf (if someone is representing you, a designation of agent form must be submitted with the application). • The arbitrator will take all of the information presented under advisement and notify you at a later date of the decision. The value could be lowered but not sufficiently to reduce the fee. It could also be left at the ARB value. Winning means the value decided is nearer your opinion than the ARB’s. In that case, all but $50 (retained by Comptroller to cover administrative costs) will be refunded to you and the CAD pays the balance of the fee. The decision of the arbitrator is final/binding on both parties (unless fraud, etc. occurred). Before making a decision to attempt arbitration, review the information available on the Comptroller’s website including the frequently asked questions at https:// comptroller.texas.gov/taxes/property-tax/arbitration/faqs. php. Watch the “beginner’s” video at https://comptroller. texas.gov/taxes/property-tax/video/2015-arbitration- videos/binding-arbitration-beginners/presentation_ html5.html. You may also view a listing of arbitrators in Galveston County at https://comptroller.texas.gov/taxes/ property-tax/arbitration/arbitrators-county.php.