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
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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.