WHAT EVERY LAWYER SHOULD KNOW ABOUT PROPERTY TAXES
An insiders' guide to the confusing world of property taxation from BRUSNIAK TURNER. Providing insight and saving lawyers research time and their clients money since 1981

APPRAISAL REVIEW BOARDS: THE WEAKEST LINK!

© John Brusniak 2024
“You'll get a fair trial followed by a first class hanging.”
- Judge Roy Bean

THE MOST MINIMUM DUE PROCESS POSSIBLE
Remember those fond law school days when the concept of minimum standards of constitutional Due Process were drilled into your head? Put those memories on “Do Not Disturb.” When Appraisal Review Boards (“ARB”) were birthed, the legislature focused on the word “minimum” and not the words, “Due Process.” ARBs are designed to move 2 million taxpayer protests in two months each year. To do so, hearings have to be short. Typically, 15 minutes—including time for both sides—even in complex cases. You may get lucky and get more time, but don't count on it. In essence, the system is built to emphasize speed over accuracy.

STATUTES AND RULES
If you read the Texas Tax Code, the Comptroller Rules, the Comptroller's publications, and your local ARB rules, you may think protective measures or guardrails exist—and they do, sometimes. But, if your legal rights get violated, you have little or no recourse. You can appeal ARB decisions to district court, to the State Office of Administrative Hearings, or even to binding arbitration. But bad news! Courts will not review errors committed by ARBs because appeals are conducted de novo. Under de novo review, procedural errors and violations are irrelevant and disregarded. Limited binding arbitration remedies do exist for violations of law, but the process and the results are typically insipid.

THE HEARING
Hearings are typically held in small conference rooms with folding tables and chairs. ARB members sit at the “front” of the room. Appraisal district representatives sit next to you or somewhere adjacent to you. A typical ARB panel has three board members. Three members is the statutory minimum. Do not be surprised if you show up at a hearing in a non-metro county and see panels of 5, 7, 9 or even 15 members present for your hearing.

NO QUALIFICATIONS ARE REQUIRED TO SERVE ON AN ARB
Well, almost none. ARB members must reside in the county, and they must still be breathing. (Government employees and their close relatives are disqualified from serving on ARBs.) I have participated in ARB hearings where board members were legally blind or deaf—with no accommodation being made for them to understand what is occurring at the hearing. There are no educational or experiential requirements. The only practical requirement to serve on an ARB is to have nothing to do all day between the months of May and July. Most ARB members are retirees, and very few know anything about real estate. For many of them, the best part of serving is getting paid around $150 a day and not having to watch daytime TV.

TRAINING
The Comptroller puts on mandatory training programs each year for ARB members. New members take an eight-hour class. Returning members take a four-hour class. No member can serve without the Comptroller's certification that a person has sat through the full class. (If you have ever taken an online drivers education class. how closely did you pay attention?) No test is required or administered at the end.
In fairness, the classes are fairly decent. I have taken them twice. The instructors are fair, competent and capable. The Comptroller does an outstanding job of instructing ARB members that they are independent adjudicators and are in no way connected to appraisal districts. However, too much material covered in too short a time. If I was to teach this as a class, it would be a semester long three-hour program. (And that would still not cover
everything.) New members are provided with a 100-page booklet with an appendix. Returning members receive a 50-page booklet with an appendix.

THE EFFECT
Sadly, I find that training has little or no effect. Particularly not the part about the ARB members being neutral and independent of the appraisal district. The training does not
discuss (although the booklets do briefly) anything dealing with special valuations (like agricultural valuations), charitable exemptions, or legal matters. If you have one of these issues, you will typically face a panel that gives you a “deer in headlights” look while the appraisal district representative runs you over. But unfortunately, there is no avoiding an ARB – participating in a hearing is a mandatory step to appealing a decision to district court. Try and bypass it and the court will dismiss your case for failure to exhaust administrative remedies.

“STOCKHOLM SYNDROME”
Not actual, Stockholm Syndrome. There are no kidnappers or victims, but a similar phenomenon occurs. Appraisal review board members hang out at appraisal districts, they drink coffee with appraisal district employees, and they get to chat with each other before, after and in-between hearings. A friendly familiarity develops. You will experience this in response to arguments you make or evidence you present when you hear ARB members
make comments like, “That's not how it is done in this district,” or “We are required to rely on the schedules the district has created.” Untrue! In a fair and impartial hearing, you
would be allowed to explain why the district's preconceived notions and regimens do not apply to your client's property.

GEEZ, WHY BOTHER?
The best reason to go through the hearings process is because the overall statewide batting average for achieving “some amount of reduction” is not bad. Of all the protests that were scheduled for hearing in 2022, 26% received a reduction as a result of a hearing. Another 18% achieved a reduction by settlement prior to a hearing. Statistics released by the state do not quantify the percentage of requested relief that was granted. Your mileage may vary from county to county. Generalizing, I encounter the most difficult panels in rural counties. No one actually says it, but you get the sense that the board members are
thinking, “You aren't from around here, are you?” 

SOME IMPORTANT THINGS TO KNOW ALWAYS APPLICABLE
You have the right to receive at least 14-days written notice of hearing. The appraisal district carries the burden of proof regarding value or unequal
treatment during the hearing. You can insist that they present first. At all other hearings, the burden of proof is on the taxpayer. Ex parte communications with ARB members regarding a hearing topic are strictly
prohibited. Criminal sanctions apply. An ARB member can avoid consequences by withdrawing from a hearing before it commences. (I cannot say that no ARB member has been improperly coached by an appraisal district prior to one of my hearings. My spider senses have gone off on multiple occasions. But nothing I can prove.) ARBs have their own legal counsel. It is not unusual to encounter appraisal district
employees misstating the law. If you run into this, ask the board to take a break and call their lawyer for advice before deciding.
Before a hearing starts, hand out any physical evidence you intend to use first to the appraisal district representative and then to the board members. Make sure you bring enough copies for everyone.

UPON WRITTEN REQUEST
You are entitled to an informal settlement conference. You are entitled to receive all the evidence that the appraisal district intends to present at least 14-days before the hearing. (Remedy for violation is at your option:
Exclusion of the evidence from the hearing or a rescheduling of the hearing to allow you additional preparation time.) You are entitled to a postponement if your hearing time is delayed by two hours. If you represent multiple properties, you can request them to be scheduled together. Hearings can be postponed prior to the scheduled hearing date if a showing of goodcause is made. (Property owners are allowed one free postponement without showing good cause.) If you miss a hearing, you have four days to request a new hearing, but you must specify good cause for your failure to attend the scheduled hearing. Check the local ARB's rules as to what constitutes “good cause."

HOW TO WIN
You and your client know their property better than an appraisal district. Bring lots of convincing evidence. Documents. Photographs. The more the better. Some ARB members believe (incorrectly) that oral sworn testimony is to be disregarded. Do not use complex terminology or legalese. Do not assume that the board members understand appraisal principles. Speak clearly. Without being condescending, explain it in a way a middle school student would understand it. Prepare your case and understand what you are up against based on my explanations above. Do not discuss tax repercussions from the hearing. ARB members can do nothing
about taxes, and bringing taxes up really sets them off. Do not lose your cool. No matter what! Remember, this is not the end of the road. You have appeal rights.

UP NEXT: A series explaining the mysteries of property valuation.