Average home value $328,440

Taxable values for single-family homes in Frisco are increasing for the second straight year.

Preliminary appraisal district numbers, provided by the city, show that overall in Collin and Denton counties, the average city of Frisco home rose to $328,440 in 2013—an increase of more than 9.5 percent.

The overall residential taxable value increase is about $2.27 billion more than 2013 certified appraisal values in the city of Frisco—a nearly 14.4 percent increase. More than $333 million, or more than 36 percent of the taxable value increase, is from new construction.

"There is no doubt in my mind that the market increase for 2014 is the highest it's been in the last six years," said Bo Daffin, chief appraiser for the Collin Central Appraisal District.

Daffin said since the burst of the housing bubble of 2007, the county saw either declining or relatively flat residential taxable values through 2012.

"It started to turn around in 2012 for the 2013 appraisal," he said. "We saw supporting evidence that the market started to heat up in February and March of 2013."

Daffin said playing a part in the desirability of homes in North Texas—and therefore the higher property values—are the amenities the area has to offer.

"Close to an airport, good schools, job possibilities—all those things would play into the minds of the buyer and seller," Daffin said.

The tax rate process

The taxable values will be certified the third week of July. Taxing entities such as cities and school districts use the values to begin building budgets for fiscal year 2015 and determining the property tax rate.

The governing board of the taxing entity, not the appraisal district, determines the tax rate. Governing boards have the option to adjust tax rates each year depending on how much money is needed to fund the annual budget.

With property values increasing in both the city of Frisco and Frisco ISD, keeping the same 2013-14 tax rate would automatically mean more money for both taxing entities.

The only way for governing boards to offset increasing home values—and therefore the amount of tax money paid—would be to lower the tax rate.

In fiscal year 2014, the city of Frisco and FISD tax rates stayed the same as the previous year despite increasing values.

FISD, which does not wait for the certified values because its fiscal year begins July 1, presented its near final 2015 budget on May 12. According to the preliminary version of the budget, the total tax rate will remain the same as last year.

"Our preliminary certified values indicate an increase from last year, which was higher than our projections," FISD's Director of Finance Todd Fouche said. "Under the current state funding formulas, an increase in local tax revenue has a negligible impact on total maintenance and operations revenue. The greatest impact for FISD is seen in the interest and sinking revenue, which has allowed us to maintain our current tax rate while selling additional bonds for building projects."

Fouche said the additional dollars the district will bring in because of the taxable growth will go to support additional costs the district is expected to incur.

"Enrollment in the district is growing quickly," he said. "The growth in student population, which dictated opening five campuses this fall, has increased our operating expenditures from last year to this year."

The city of Frisco budget process will begin with a council work session in June.

Assistant City Manager Nell Lange said the city does not anticipate a tax increase.

"We have received preliminary assessed property values from Collin and Denton counties and anticipate we will see some reductions over the next two months as a result of the Appraisal Review Board process," she said. "While we're pleased to see the amount of new assessed value from the appraisal districts, the amount of revaluation is challenging. We are very early in the budget process and still have a lot of analysis to complete."