BILL ANALYSIS

H.B. 1203

By: Elkins

Ways & Means

Committee Report (Unamended)

BACKGROUND AND PURPOSE

The practice of property tax consultants acting as agents of a property owner in filing protests without specific authorization from the property owner has become a serious problem.  In 2008, a Houston property tax agent filed more than 20,000 protests for which the consultant had no valid written designation of agent. This type of conduct backlogs the hearing process and greatly increases the cost of doing business for appraisal districts. 

The problem was exacerbated in 2008 by an attorney general opinion stating that Section 1.111(b) of the Tax Code authorizes a designation of agent form to be signed by an "other person authorized to act on behalf of the owner."  A property tax consultant that falls within the statutory language, as construed, therefore is authorized to execute and complete a form designating an agent on behalf of the property owner.  Currently, multiple agents may claim to represent the same party while appraisal districts often learn from the property owner at a later time that he or she never appointed an agent. There have been many instances of property owners billed by a property tax consultant for services the consultant claims to have been authorized to perform on the basis of an alleged verbal appointment and, in many of these cases, the agent brings suit against the property owner in small claims court.

H.B. 1203 requires the written authorization designating a person to act as an agent of the owner for a single-family residential property to be on a form prescribed by the comptroller of public accounts and delivered to the appraisal district before the designation of agent is effective.  The bill also clarifies that the person appointed as such an agent may not appoint himself or herself, which is current practice among some agents.  In summary, this bill codifies what was standard practice prior to the attorney general opinion issued in 2008.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

H.B. 1203 amends the Tax Code to require the written authorization designating a person to act as an agent of the owner for a single-family residential property to be on a form prescribed by the comptroller of public accounts, and provides that another person authorized to act on behalf of the owner in signing the form must be someone other than the person being designated as the property owner's agent.  The bill provides that the designation of an agent does not take effect with respect to an appraisal district or a taxing unit participating in the appraisal district until a copy of the designation is filed with the appraisal district.

EFFECTIVE DATE

On passage, or, if the act does not receive the necessary vote, the act takes effect September 1, 2009.