79R10391 JD-F
By: Mowery, Wong, Truitt, et al. H.B. No. 182
A BILL TO BE ENTITLED
AN ACT
relating to the determination through binding arbitration of
certain ad valorem tax protests brought by property owners.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 41, Tax Code, is amended by adding
Subchapter E to read as follows:
SUBCHAPTER E. PROTEST THROUGH BINDING ARBITRATION
Sec. 41.81. RIGHT TO ARBITRATION. (a) In this section,
"residential real property" means real property that:
(1) qualifies for an exemption under Section 11.13; or
(2) is designed or adapted for residential purposes
and on which is located one or more condominiums or no more than one
single-family dwelling unit.
(b) As an alternative to having a protest brought under
Section 41.41 heard by the appraisal review board, a property owner
is entitled to have a protest concerning the appraised or market
value of residential real property determined through binding
arbitration under this subchapter if the appraised or market value,
as applicable, of the property as determined by the appraisal
district is $1 million or less.
Sec. 41.82. NOTICE OF RIGHT TO ARBITRATION. An appraisal
district that delivers a notice of appraised value under Section
25.19 shall include with the notice:
(1) a notice of the property owner's rights under this
subchapter; and
(2) a copy of the form required by Section
41.83(a)(1).
Sec. 41.83. REQUEST FOR ARBITRATION. (a) To request that a
protest be determined by an arbitrator under this subchapter, a
property owner must file with the appraisal district not later than
the deadline for filing a protest established by Section 41.44:
(1) a completed request for binding arbitration under
this subchapter in the form prescribed by Section 41.84; and
(2) an arbitration deposit in the appropriate amount,
made payable to the comptroller.
(b) The amount of the arbitration deposit required by
Subsection (a)(2) is an amount equal to the lesser of $750 or
one-fourth of one percent of the appraised or market value of the
property as determined by the appraisal district that is being
protested, rounded up to the next whole dollar amount.
(c) A request for arbitration is a valid and enforceable
arbitration agreement for purposes of Chapter 171, Civil Practice
and Remedies Code.
Sec. 41.84. CONTENTS OF REQUEST FORM. (a) The chief
appraiser shall prescribe the form of a request for binding
arbitration under this subchapter. The form must require the
property owner to provide only:
(1) a brief statement that explains the basis for the
property owner's protest of the action of the appraisal district;
and
(2) any other information reasonably necessary for the
appraisal district to request appointment of an arbitrator.
(b) The comptroller by rule shall prescribe a model form for
purposes of this section. The form must include a brief statement
that explains how the property owner can calculate the amount of the
arbitration deposit required by Section 41.83(a)(2).
Sec. 41.85. PROCESSING OF ARBITRATION REQUEST. Not later
than the 10th day after the date an appraisal district receives from
a property owner a completed request for binding arbitration under
this subchapter and the arbitration deposit required by Section
41.83, the appraisal district shall:
(1) endorse the request;
(2) submit to the comptroller the request, the
arbitration deposit filed by the property owner, and an additional
$250 arbitration deposit from the appraisal district, made payable
to the comptroller; and
(3) request that the comptroller appoint a qualified
arbitrator to conduct the arbitration.
Sec. 41.86. REGISTRY AND QUALIFICATIONS OF ARBITRATORS.
(a) The comptroller shall maintain a registry listing the
qualified persons who have agreed to serve as arbitrators under
this subchapter.
(b) To qualify to serve as an arbitrator under this
subchapter, a person must:
(1) have completed at least 30 hours of training in
arbitration and alternative dispute resolution procedures from a
university, college, or legal or real estate trade association;
(2) be licensed as a real estate broker or salesperson
under Chapter 1101, Occupations Code, or be licensed or certified
as a real estate appraiser under Chapter 1103, Occupations Code;
and
(3) agree to conduct an arbitration for a fee that is
not more than $500.
Sec. 41.87. APPOINTMENT OF ARBITRATOR. (a) On receipt of
the request and deposits under Section 41.85, the comptroller shall
send the property owner and the appraisal district a copy of the
comptroller's registry of qualified arbitrators and request that
the parties jointly select an arbitrator from the registry. The
parties shall attempt to select an arbitrator from the registry.
(b) Not later than the 10th day after the date the parties
receive the registry, the appraisal district shall notify the
comptroller that:
(1) the parties have selected an arbitrator and
request that the comptroller appoint the selected arbitrator; or
(2) the parties were unable to agree on the selection
of an arbitrator and request that the comptroller appoint an
arbitrator.
(c) On receipt of notice from the appraisal district under
Subsection (b), the comptroller shall:
(1) appoint:
(A) the arbitrator selected under Subsection
(b)(1), if applicable; or
(B) any arbitrator included in the comptroller's
registry, if Subsection (b)(2) applies; and
(2) send notice to the arbitrator appointed,
requesting that the arbitrator conduct the arbitration.
(d) If the arbitrator appointed is unable or unwilling to
conduct the arbitration for any reason, the arbitrator shall
promptly notify the comptroller that the arbitrator does not accept
the appointment and state the reason. The comptroller shall
appoint a substitute arbitrator promptly after receipt of the
notice.
Sec. 41.88. NOTICE AND HEARING; REPRESENTATION OF PARTIES.
(a) On acceptance of an appointment to conduct an arbitration under
this subchapter, the arbitrator shall set the date, time, and place
of a hearing on the arbitration. The arbitrator shall give notice
of and conduct the hearing in the manner provided by Subchapter C,
Chapter 171, Civil Practice and Remedies Code.
(b) The parties to an arbitration proceeding under this
subchapter may represent themselves or be represented by a
designated person, including an attorney or a property tax
consultant, real estate appraiser, or real estate broker acting
under power of attorney. Each party is responsible for the fees of
its own representative.
Sec. 41.89. AWARD; PAYMENT OF ARBITRATOR'S FEE. (a) Not
later than the fifth day after the date the hearing under Section
41.88 is concluded, the arbitrator shall make an arbitration award
and deliver a copy of the award to the property owner, appraisal
district, and comptroller.
(b) An award under this section:
(1) shall include a determination of the appraised or
market value, as applicable, of the property that is the subject of
the protest;
(2) may include any remedy or relief that an appraisal
review board may order under this chapter;
(3) shall specify the arbitrator's fee, which may not
exceed $500;
(4) is final and may not be vacated except as permitted
under Section 171.088, Civil Practice and Remedies Code, for an
award subject to that section; and
(5) may be enforced in the manner provided by
Subchapter D, Chapter 171, Civil Practice and Remedies Code.
(c) Except as provided by Subsection (d), if the arbitrator
determines that the appraised or market value, as applicable, of
the property that is the subject of the protest is less than 95
percent of the appraised or market value, as applicable, of the
property as determined by the appraisal district, rounded down to
the next whole number:
(1) the arbitrator shall award to the property owner
an amount equal to the amount of the property owner's arbitration
deposit; and
(2) the appraisal district, before the 30th day after
the date of receipt of a copy of the award, shall pay that amount to
the property owner.
(d) If the appraised or market value of the property as
determined by the appraisal district and that is being protested is
$200,000 or more, and the arbitrator determines that the appraised
or market value, as applicable, of the property is less than 90
percent of that value as determined by the appraisal district,
rounded down to the next whole number, the arbitrator and the
appraisal district shall comply with Subsections (c)(1) and (2).
(e) On receipt of a copy of the arbitrator's award, the
comptroller shall pay from the total amount of the arbitration
deposits from the property owner and the appraisal district held by
the comptroller:
(1) the amount of the arbitrator's fee to the
arbitrator; and
(2) any remaining balance to the appraisal district.
(f) If the amount paid to the appraisal district under
Subsection (e) is less than $250, on application of the appraisal
district and from any arbitrator deposits held by the comptroller
that are available for that purpose, the comptroller shall pay the
amount of the difference to the appraisal district.
Sec. 41.90. RULES; DELEGATION OF APPOINTMENT AUTHORITY.
The comptroller may:
(1) adopt rules necessary to implement and administer
this subchapter; and
(2) designate employees authorized to appoint
arbitrators under this subchapter.
SECTION 2. As soon as practicable after the effective date
of this Act, but not later than October 1, 2005:
(1) each appraisal district shall prescribe the form
of an arbitration request as provided by Section 41.84, Tax Code, as
added by this Act; and
(2) the comptroller shall:
(A) prescribe the model form for an arbitration
request as provided by Section 41.84, Tax Code, as added by this
Act; and
(B) establish a registry of qualified
arbitrators as provided by Section 41.86, Tax Code, as added by this
Act.
SECTION 3. Subchapter E, Chapter 41, Tax Code, as added by
this Act, applies only to a protest filed by a property owner under
that chapter on or after the effective date of this Act.
SECTION 4. This Act takes effect September 1, 2005.