An increase in Frisco’s appraised property values is corresponding with a rise in appraisal protests from Frisco residents.
The average certified home appraisal in Frisco increased by more than $66,000 between 2015 and 2017, according to Collin and Denton central appraisal districts. This increase could add upwards of $1,500 to the average annual tax bill.
Though certified totals are not finalized for 2018, both appraisal districts have received an influx of protests this year.
The Collin Central Appraisal District received nearly 63,000 residential property protests this year—up from nearly 59,000 in 2017. The Denton Central Appraisal District received more than 82,000 protests so far this year, or about 10,000 more than last year.
Protests in Frisco totaled about 19,000 this year, up more than 2,000 from last year.
In response to rising home values, Frisco City Council voted in late June to increase its homestead exemption from 7.5 percent to 10 percent.
“I think historically anytime you see values increase you’re going to see an increase in protests,” CCAD Chief Appraiser Bo Daffin said. “So things went flat protest-wise when the housing bubble burst back in 2007 … but once the market started to recover and values started to increase again then [we]have seen a natural incline in protest counts.”
Bobby Ola is the president of Ola Tax, a firm that helps homeowners protest property appraisals in Collin, Dallas, Denton and Tarrant counties. Ola said his team’s workload has increased by
30 percent this year because of the number of homeowners wanting to protest.
“We receive so many calls from owners who feel like they’re just getting taxed out,” he said.
Ola said protesting can help keep a property appraisal from increasing significantly each year because there is a cap on how much an appraisal can increase year over year. Lowering a property appraisal could keep it from increasing as dramatically the following year, he said.
“As a property owner as well, I want to get [my appraisal]as low as possible because the lower you can keep it the better, especially if you have a homestead,” he said. “If you keep fighting and chipping away then you have benefits in the long term.”
Frisco resident Skip Cannon protested his home appraisal for the first time this year and was able to get his value reduced by about $12,000.
Cannon said the entire protest process was new to him. What he learned was to bring as much evidence as he could—including repairs needed on his home and the state of other properties around his home—to the CCAD Appraisal Review Board, which handles all protest cases in Collin County, to strengthen his case for lowering his appraisal.
Cannon’s advice to homeowners who may want to protest next year is to try it.
“The worst they can say is no,” he said. “And do a little bit of homework. The more evidence I submitted, the more to them it looked like I did my homework.”
The appraisal process is similar in Collin and Denton counties.
When appraising a property, the CCAD looks at actions of buyers and sellers in the neighborhood over the past six to 12 months. Kelly Lintner, deputy chief appraiser of appraiser operations at CCAD, said it is important to have a true representation of home values.
“We are trying to reflect what buyers and sellers are doing based on their transactions; that’s it,” Daffin said. “We are looking at sales transactions in a neighborhood.”
DCAD is responsible for appraising every home in Denton County using a mass-appraisal system, said George Clerihew, DCAD deputy chief appraiser of appraiser operations. During the mass-appraisal process, appraisers look at a list of comparable houses that were recently sold in the same neighborhood. The appraiser then compares the comps to the resident’s property and adjusts accordingly. Many appraisal districts, including CCAD, use this system.
“We don’t create the market; we measure the market based off what sellers and buyers are paying for the houses,” Clerihew said.
In an effort to provide some relief to homeowners, Frisco City Council passed the city’s first-ever homestead exemption last year. According to the Texas Comptroller’s Office, a homestead exemption removes part of a home’s value from taxation.
The city’s 7.5 percent exemption went into effect for taxes due this year. On June 29, Frisco City Council increased the exemption to 10 percent.
“We’re just looking at rising property values, and we hear from our residents that taxes are rising, and it’s becoming a burden on them,” Frisco Mayor Jeff Cheney said. “So [the exemption is]just a way for us to lower the tax burden on our residents and provides that immediate tax relief.”
Even with the exemption, property tax revenues are expected to continue increasing in Frisco as they have in recent years. Between the 2015-16 and 2016-17 fiscal years, property tax revenue increased by nearly $15 million in Frisco, according to city financial reports.
The Collin College board of trustees also passed a new homestead exemption last year of either $5,000 or
1 percent of a home’s appraisal value, whichever is higher.
Some Texas lawmakers have tried to slow rising property tax revenue increases as appraisals climb.
During the 2017 legislative session, Senate Bill 2 was brought to the table. Under the proposal, a special election would have been called whenever the local property tax collections increase more than 5 percent year over year.
State law already allows residents to petition for a rollback election—which is a referendum on the proposed tax rate—when annual tax collection increases exceed 8 percent year over year.
SB 2 did not pass during regular session or during a special session called by Texas Gov. Greg Abbott. However, Abbott unveiled a plan in January to limit local government’s property tax revenue growth to 2.5 percent—half of the proposed limit in SB 2.
Miranda Wilcox contributed to reporting.