Texas government officials don’t always have the greatest aptitude for math.
Take Comptroller Susan Combs, for instance: Before the last legislative session, she underestimated the state’s revenues, which state legislators must not exceed in crafting a budget, by nearly $17 billion.
Sorry, kids, indigent population and anyone else who could have used the extra money.
More recently, the incompetence has trickled down to the county level.
Last week, the Travis County Commissioners Court decided not to challenge the 2014 commercial property tax rolls. For years, commercial property owners have taken advantage of a state law that allows them to pay taxes on values much lower than their holdings are worth. While residential property owners can challenge their appraisals, they have not enjoyed the same boondoggle as businesses have.
That means that anyone who doesn’t live in a commercially zoned area is picking up their slack.
According to Real Values for Texas, a property tax reform group, Texas commercial property owners are paying property taxes on just 60 percent of the value of their properties. While this group has an agenda, its estimate is buttressed by a finding by Harris County that vacant commercial lots might have been appraised at 62 percent of market price.
But when that glaring inequality, which really shouldn’t come as news to anyone at the county, was brought before the commissioners, they did nothing. County Judge Sam Biscoe, who just a few weeks ago seemed poised to act on homeowners’ behalf, cited two reasons: a lack of time to prepare such a large challenge before the June 17 deadline and insufficient savings to homeowners (or landlords).
A lack of time is laughable for the longevity of the commercial-residential disparity. But how about those savings? Just how insufficient were they, you might ask?
$5, maybe $10, according to a memo produced at Commissioner Bruce Todd’s request.
That’s based on the assumption that the county could add either $500 million or $1 billion to its tax rolls. But according to Laura Pressley, a candidate for the Austin City Council, the current appraised value of commercial property in Travis County is $56 billion. If we assume that Real Values for Texas is right, that would mean the county is being shortchanged to the tune of about $22 billion every year.
Assuming the county’s predicted savings of $10 is correct for an increase of $1 billion, about $220 should be freed up for the actual figure. And that’s just for the county alone, leaving out the taxing districts for the city, the public hospitals, Austin Community College and the Austin Independent School District. All told, taxpayers could save more than $1,000 annually, not $10.
Why, then, did the commissioners obscure the real benefit of restoring fairness to the taxation system? Sure, one might argue that they were being conservative, but to wager a guess of as low as $500 million seems overly pessimistic and dismissive of homeowners’ concerns.
It’s bad enough that the commissioners didn’t even try to do anything, but even worse that their action was based, in part, on such a stingy and obfuscatory assumption. (To its credit, the Austin City Council, which also didn’t take any official action this time around, promised to act next year.)
Sorry, Travis County homeowners and UT students who rent their properties. You’ll see the inaction in next month’s rent.
