Monday, November 10, 2008

Too Late for Tax Protest? *UPDATE*

Tax bills were received in Wilmer from the County Comptroller's Office earlier in the week. Is it too late to file an injunction prohibiting collections? May be, but there's good reason to question or protest your tax bill for 2008.

For the detailed technical legal references online, see the reference links at the bottom of this article.

Wilmer has a couple of situations that merit scrutiny of how we have arrived at the tax rate and communicated that to the public, at least for the current year. The City Council seems to believe that if the ad valorem tax rate is reduced, then some rules don't apply, but this is definitely not the case in 2008.

One of the required public notices published in the Ellis County Press on September 11, 2008 is the tax rate levy information used to establish a new tax rate for the city. Most of the information comes from the Dallas County Tax Assessor or DCAD about property valuations and total tax base for ad valorem taxes. But the county appraisal district may not have information on newly annexed property unless the city reports the annexation to them.

We have received information that over $1 million in appraisal values on recently annexed property on East Belt Line Road were omitted from the 2008 reports to the county and thus not included in the tax levy calculations. The recently annexed property west of town (Xebec property) would not have been completed in time for inclusion in the 2008 tax base.

Taxing districts are also required to furnish a worksheet (Schedule C) in their published notice of tax levy for new sources of sales tax revenues for the year. Readers may remember the recent legalization of liquor sales in Wilmer. No sales tax revenue from the sales of liquor in Wilmer were included in any notices regards the tax levy. Likewise, no new revenues were identified from these sales tax sources in the budget documents available to the public.

Taxing districts are also required to complete a statement of debt service obligations (Schedule B) which was included in the public notice, but showed all $0 amounts. According to sources with the Texas Water Development Board, Wilmer still has an outstanding debt obligation of $130,000 remaining on a prior $250,000 water development loan.

There are of course statutory mandates about the size of the notices published in a general circulation newspaper regarding how many days in advance or between meetings such notices are required. This includes typeface size and required language. We can't find where Wilmer complied with these provisions in their Ellis County Press notice of September 11, 2008.
Click Here to check out the published notice.

It appears that two notices of public hearings are now required in all instances where the tax rate increases or the total amount of taxes increases in the taxing district. We note that the City published only one notice of public hearing and that was in the Ellis County Press of August 28, 2008 regarding the single public hearing on taxation held September 18, 2008. This notice did not meet the new 2008 requirements: "Tax Code Section 26.06 requires the notice be at least a quarter page in a standard-size or tabloid-size newspaper. Its headline must appear in 24-point type or larger. It may not appear in the legal or classified section of the newspaper."
Click Here to View the Notice published in the Ellis County Press August 28 if you can find it on the page!

To date, the city has still not published a completed budget available to the public. The documents available for public inspection prior to the public hearing were incomplete and inaccurate, completely lacking proposed budget line item amounts. Statutes require that these documents be continuously available to the public for thirty days preceding the public hearing on taxation. As of the meeting date, the documents were not available for inspection in a reasonably complete format. One copy we were able to inspect prior to the public hearing indicated NO projected revenues and NO projected expenses for the city departments for the 2008-2009 fiscal year, only current "YTD actuals".

Finally, one Wilmer resident reported success in getting a reduction in his Wilmer City Taxes from the DCAD in a protest action for the 2007 taxes based on alleged misconduct by city officials. Considering what we've uncovered in the city's process for arriving at our 2008 tax levy, this might work for all of us at property tax protest time.

The Texas Comptroller has a Truth in Taxation handbook available online that details the process and the requirements for the current year:

Some additional details can be found at the Texas Municipal League web site:

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