Properties in the Dallas County side of the city have an estimated total value of $11.8 billion, Finance Director Keith Dagen told City Council on June 1.
Collin County values represent $8.2 billion of the city’s tax roll, Dagen said. The city is expecting the combined total of $20 billion to fall by about $470 million once residents protest their values.
Property value growth in the city’s three tax increment finance zones account for about $2.2 billion of the total tax roll, which means the city’s taxable value is reduced to $17.3 billion, Dagen said.
Increased revenue from property taxes in these zones are used to fund infrastructure and development and therefore cannot be used for budgetary purposes, Dagen said.
The city has seen property values increase by 5.2% on average over the past decade. This year’s increase of 4.3% after taking into account revenue reserved for tax increment finance zones is the lowest increase since 2017, when values increased by 12.4%, Dagen said. In 2011, the city saw a 3% decline, he added.
“As we have grown accustomed to really nice value increases each year, I do want to remind [you] that we have had declines along the way,” he said.
All taxable property is appraised as of Jan. 1, which means this year’s estimated values predate economic hardships tied to the coronavirus; however, appraisal districts have warned of “multiple impacts” due to the pandemic, Dagen said.
Chief appraisers of both Collin and Dallas central appraisal districts have opted to delay all in-person appraisal review board hearings and will be conducting protests by phone only, Dagen said.
Neither district expects to meet the state-mandated July 25 deadline to provide a certified roll to taxing entities, Dagen said. Instead, they will provide a certified estimate by that date.
The city will use these estimates to calculate its tax rate, Dagen said. This means the resolution of future outstanding protests will “possibly have a negative impact on fiscal year 2020-21 tax collections,” he said.
Dagen and his staff will continue to monitor protest activity throughout the summer and will factor any changes into the final budget strategy, he said.
Richardson’s budget and tax rate are scheduled for adoption Aug. 24.
