By: Davis S.B. No. 1342

A BILL TO BE ENTITLED

AN ACT

relating to evidence of inequality of appraisal in judicial appeals of appraisal review board orders.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Sec. 42.26, Tax Code, is amended by amending Subsections (a) and (b) 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 appraised value of the property exceeds the median level of appraisal [appraised value] of a reasonable and representative sample [number] of comparable properties appropriately adjusted; or.

(4) if:

A) the property qualifies as the owner's residence homestead under Section 11.13; or

(B) the appraised or market value, as applicable, of the property as determined by the order is $1 million or less, the appraised value of the property exceeds the median appraised value of a reasonable sample [number] of comparable properties appropriately adjusted. The comptroller shall by rule establish standards for development and calibration of adjustments for industrial, petrochemical refining and processing, and utility properties.

(a-1) For the purposes of subsections (a)(3) and (a)(4), whether a property is comparable to the subject property shall be determined based on similarities with regard to location, highest and best use, square footage of the lot and improvements, property age, property condition, property access, amenities, views, income, operating expenses, occupancy, economic conditions, and the existence of easements, deed restrictions, or other legal burdens affecting marketability. Improved property is not comparable to unimproved property.

(a-2) For the purposes of subsections (a)(4), adjustments must be developed and calibrated in compliance with generally accepted appraisal standards.

(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 appraised value according to Subsection (a)(3). If a property owner is entitled to relief under Subsection (a)(4), the court shall order the property's appraised value changed to the value calculated on the basis of the median appraised value according to Subsection (a)(4). 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 that in the judgment of the court, best reflects the level of appraisal of other property in the appraisal district [results in the lowest appraised value]. The court shall determine each applicable median level of appraisal or median appraised value according to law, and is not required to adopt the median level of appraisal or median 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.

SECTION 2. This bill takes effect September 1, 2013.