Texas RV Park Owner Wins Tax Appeal, Sort Of
Editor's Note: Maria Davis-Seale, a staff writer for the Mount Pleasant (Texas) Daily Tribune, sat in during recent tax appeals hearings. Following are excerpts from her story.
It's an extremely heavy year for property tax appraisal protests, according to Ronnie Babcock, who's served Titus County as Chief Appraiser since June 2006.
Why? In a recent interview, Babcock told the Tribune, "Well, of course, the main factor is that property values went up. I think the other contributing factor is that people didn't understand why the national economy looked so bad and their property values were going up."
"They went up because the market trends told us that's where they needed to go. It's based on sales data. It depends, too, on if property values were appraised incorrectly too low in the past. If it was incorrect and low last year, it will go up quite a bit this year."
Babcock said that national trends of declining home values are misleading, because they take into account both coasts, with markets there drastically down.
"Most of the protesters just don't agree that their taxes should go up. A lot of the times people are talking about taxes, not their property value. Value is what the Appraisal Review Board (ARB) hearing is about, but property value drives the amount of their taxes. What the ARB has control of and any chance of changing is the appraised value.
If property owners disagree on the value, they can bring evidence to the review board as to why they don‘t think their property is valued correctly, whether that be evidence of some kind of structural problem we don't know about, figures on actual sales comparable to their property, and that type of thing. They can bring photos of the structures."
One thing that works against the property owner, according to Babcock, is paying more for a property than what was reported to the appraisal district. "Under oath, if they tell us they gave more for their property than we have it listed on the roll for, their chances are good for their appraisal value to go up."
"One of the most common misconceptions is that the appraisal district's purpose is to raise values to give the taxing entities more money. That's not correct. As required by state law, our purpose is to place property on the appraisal roll at 100% of market value on Jan. 1 of that year. Market value is what the property would sell for to a willing buyer and willing seller with no outside influences."
In the face of a progressively tough economy, rural life takes on a harsh cast under the ceiling lights in the Titus County Appraisal District Review Board (ARB) hearing room.
When the Tribune covered an afternoon of ARB hearings, the review board voted to lower the appraisal values and favored the property owners in most of the cases. In those instances, the adjustment down was made because the appraisal district could not provide evidence for the appraisal values set.
Several business property owners came to protest that day and their conversations carried a common message that high appraisals and high property taxes were discouraging and placing hardships on local businesses. The term "inconsistent" bounced across the hearing room several times.
Tina Kay – Ramblin' Fever RV Park
The Appraisal Review Board heard the protest of Tina Kay. She and her husband Ricky own Ramblin' Fever RV Park, on 271 North. Running a park has been a dream for her, she told the Tribune, that the tax drain's turning into a nightmare. Her land, two tracts totaling approximately six acres, was valued at $10,000, and she's not protesting that amount. She's protesting the $131,000 value assessed to her improvements.
Her park features 48 campsites, 30 with paved parking pads and 18 unpaved. The appraisal district valued each site at $2,657.30.
"They each have a faucet, an electric meter and a pipe sticking up out of the ground for the sewer hook up," she told the board. "Each of the paved sites took 30 yards of asphalt for one pad. Each of my water hydrants didn't cost $350, each of electrical meters didn't cost $475."
Deputy Chief Appraiser Luke Robbins, who represented the appraisal district in the hearing that day, referred to a "fair market value" that the appraisal is supposed to reflect, and he mentioned the KOA campground.
Kay passionately protested the comparison. "You can't compare me to KOA. They are a big national operation, and here they have a swimming pool and a rec room. I have a few paved pads, a meter, a faucet and pipe sticking up out of the ground."
She rents her spaces for $25 per night, $125 a week, or $335-$355 a month depending on the amp strength required for the camper.
"I can't charge tax, and if you charge too much people won't stay with you. Right now we're three-fourths empty. It would take me nine months of making sure my park was completely filled — nine months of rent to say each of my lots was worth $2,600," she told the board. "Rentals are a seasonal thing, and there's a lot of times when nothing might not be sitting there."
Babcock told the Tribune, "We base our appraisals off of Marshall and Swift evaluation service and we start there and depreciate it and modify it to our local area. On residential, we look at sales of certain type of property in the county and build schedules to that type of property."
"KOA and Ramblin' Fever," he said, "are both campgrounds. KOA here will affect her property appraisal. We look, for example, for KOA. KOA and her campground are all valued the same by Marshall and Swift."
The afternoon Kay appeared to protest, the appraisal review board came down on the value of her property with improvements.
The deputy appraiser told the board that day, "The district feels like we are severely undervalued on this property, and we are going to have to revisit the property next year and it's probably going to go up."
Kay told the Tribune she felt that was a threat. In the meeting, her response to that comment was both question and emphatic statement: "How can you come off with saying that for next year with the economy like it is?!"
For more information on the Titus County Appraisal District online, see http://www.titus-cad.org/ . This site gives general information about the District and the ad valorem property tax system in Texas, as well as information regarding specific properties within the district.