Honorable Dennis Bonnen, Chair, House Committee on Ways & Means
FROM:
Ursula Parks, Director, Legislative Budget Board
IN RE:
HB3867 by Elkins (relating to the appeal through binding arbitration of certain appraisal review board orders; changing the amounts of certain fees.), Committee Report 1st House, Substituted
Passage of the bill would increase the value of the properties allowed to go to binding arbitration and would increase the number of binding arbitrations; however, the bill would not affect taxable property values, tax rates, collection rates, or any other variable which might affect the cost to the state through the operation of the school funding formula.
The bill would amend Chapter 41A of the Tax Code relating to access to and fees associated with binding arbitration of appraisal review board orders.
The bill would amend Section 41A.01, regarding the right of appeal by a property owner, to modify one of the types of properties for which an owner may appeal certain appraisal review board orders by binding arbitration to properties with the appraised or market value of $3 million or less, rather than $1 million or less.
The bill would amend Section 41A.03 to modify the deposit amount required to file for binding arbitration from $500 to specified amounts depending on whether the property qualifies as a residence homestead under Section 11.13 of the Tax Code and depending on the property value as determined by the appraisal review order. The deposit amounts would range from $450 to $500 for those properties that qualify as a residence homestead under Section 11.13 of the Tax Code, depending on whether the value of the homestead is $500,000 or less. For those properties that do not qualify as a residence homestead under Section 11.13 of the Tax Code, the deposit amount would range from $500 to $1,050, depending on the value of the property.
The bill would amend Section 41A.05 to set the amount of the deposit the Comptroller may retain to cover administrative costs to $50, rather than an amount equal to 10 percent of the deposit.
The bill would amend Section 41A.06 to provide that an arbitrator must agree to conduct arbitrations for a fee of not more than the specified deposits minus the Comptroller administrative fee.
The bill's provision to increase the value of the properties allowed to go to binding arbitration would be expected to increase the number of binding arbitrations; however, the bill would not affect taxable property values, tax rates, collection rates, or any other variable which might affect the revenues of units of local governments or the state.
The bill would take effect September 1, 2015.
Local Government Impact
The bill's provision to increase the value of the properties allowed to go to binding arbitration would increase the number of binding arbitrations; however, the bill would not affect taxable property values, tax rates, collection rates, or any other variable which might affect the revenues of units of local governments.