Background. Some taxpayers have had their money held hostage due to the failure of chief appraisers to make decisions on exemption and special valuation applications. In these instances, taxpayers have been forced to pay on the market value of their properties while the chief appraisers ignore their responsibilities. In other words, some Texans are forced to pay taxes when they are entitled not to pay taxes, or entitled to pay much lower amounts.

Other Texans receive decisions leaving them wondering why their applications were denied, as chief appraisers often deny applications without any or adequate explanations. To add insult to injury, in those instances where chief appraisers indicated their grounds for denial, they raise entirely new issues when the matter comes before the appraisal review board. Further, some appraisal review boards take inordinate amounts of time to schedule hearings. This problem is particularly acute in rural appraisal districts.

This behavior is so widespread that the Texas Legislature created new provisions that force chief appraisers to make decisions on property tax exemptions and special appraisals within 90 days and to provide taxpayers detailed explanations for their decisions.  

The Texas legislature now requires appraisal review boards (ARBs) to hear protests within 90 days of them being filed.  

Moving forward, Texans will finally have the tools to force chief appraisers and ARBs to do their jobs in a timely manner.

Changes. Senate Bill 63 requires chief appraisers to take action on applications for property tax exemptions not later than 90 days after: (1) the date the applicant first qualifies for the exemption, or (2) the date the applicant provides to the chief appraiser information necessary for the chief appraiser to determine the applicant's right to an exemption – whichever date is later.

The bill establishes a similar 90-day deadline for chief appraisers to take action on applications for special appraisals and determine the applicant's rights to have their land appraised under one of the following:

• AGRICULTURAL LAND;
• OPEN-SPACE LAND;
• TIMBER LAND OR RESTRICTED-USE TIMBER LAND;
• RECREATIONAL, PARK, OR SCENIC LAND; OR
• PUBLIC ACCESS AIRPORT PROPERTY.

If a chief appraiser requires additional information from an applicant to determine the applicant's right to an exemption or to special appraisal of their land, the chief appraiser must deliver a written notice to the applicant not later than the 30th day after the date the application is filed specifying the additional information the applicant must provide. If a chief appraiser modifies or denies an application for a tax exemption or denies an application for special appraisal, the requisite notice to the applicant must state and fully explain each reason for that action.

Scheduling of Protest and Motion to Correct Hearings

All protests and all motions under section 25.25 (correction of errors and substantial overvaluations) filed between January 1st and September 1st must be scheduled for hearing no later than the 90^th day after the ARB approves the appraisal records. Motions to correct filed between September 1st and December 31st must be scheduled no later than 90 days after the taxpayer requests a hearing.

Evidence Presented at Protest Hearing – Chief Appraiser Restricted from Changing Basis for Denying Special Appraisals and Exemptions 

Senate Bill 63 prohibits a chief appraiser from offering evidence or argument at a hearing on a protest in support of a reason for modifying or denying an application for a tax exemption or for special appraisal of land, other than a reason stated in the notice delivered to the property owner explaining the reason for which the chief appraiser took that action unless the chief appraiser provides written notice to the property owner of the additional reason for modifying or denying the application not later than the 14th day before the date of the hearing and establishes that the additional reason was not known to the chief appraiser at the time the chief appraiser delivered the initial notice to the applicant.

Conclusion. These new provisions significantly strengthen taxpayers' rights. Taxpayers can force the chief appraiser to decide their exemption or special appraisal application within 90 days, force the appraisal review board to hold a hearing on their protest within 90 days of filing, and force the chief appraiser to explain why he or she denied their applications. This may require taxpayers to file suit for a writ of mandamus in district court. Further, the chief appraiser is bound by the explanation he or she gives for denying the application. These provisions will apply pressure to appraisal districts and appraisal review boards to diligently decide exemption and special appraisal applications.  

The effective date of the bill is September 1, 2021.