Tag Archive for: Fowler

How Some Flood Victims Saved Substantial Tax Dollars

This is a letter to the editor from retired Kingwood resident Bill Fowler. Fowler managed real estate property taxes for one of the world’s largest oil companies for much of his career. His home flooded during Harvey.

An in-depth analysis of 2018 property tax assessments in one flooded neighborhood shows that flooded homeowners who did not protest their appraisals last year were appraised on average higher per square foot than those who did successfully protest. That means if you flooded and did not protest, you could have paid thousands of dollars more in taxes than you should—and may have been assessed inequitably.

Kingwood Greens Evacuation During Harvey by Jay Muscat
Kingwood Greens During Harvey. Photo courtesy of Jay Muscat.

Property Tax Reappraisal Season Starting Now

As Kingwood prepares for its most dreaded annual event, Hurricane Season, let’s not forget another discomforting annual occurrence, Property Tax Reappraisal Season.

Yes, this is your chance to accept the Harris County Appraisal District’s (HCAD) market value of your home or file a protest to seek a lower value.

This article should make it apparent that relying on HCAD to properly value your home can sometimes prove costly. This discussion relates specifically to flooded homes, but non-flooded homeowners should also review their assessments for opportunities to reduce HCAD’s opinion of market value.

Questions to Ensure Fair Appraisal

A majority of homeowners who flooded during Hurricane Harvey have not yet received their 2019 property tax appraisal notices from HCAD. However, some have. When you receive your 2019 assessment notice, keep these questions in mind:  

  • How much did the market value of your home change between January 1, 2018 and January 1, 2019?
  • If you made progress towards, or completed, restoration of your home between January 1, 2018 and January 1, 2019, how much did you increase your home’s market value? 
  • If your repairs are completed, is this year’s proposed value realistic compared to your 2017 pre-flood value?
  • Does HCAD have sufficient comparable post-flood sales data to support its opinion of the appraised value of your home?
  • Is your assessment equitable relative to your neighbors’?

Early Trends in Heavily Flooded Neighborhoods

A review of HCAD’s 2019 online records has revealed early trends in three heavily flooded neighborhoods. Results reported here likely include a mix of both fully and partially repaired homes. Numbers in parenthesis reflect approximate percentage of homes in the neighborhood with published 2019 assessments; HCAD lists all remaining home values as “Pending.” 

  • Kingwood Greens (25%):  Average values are up 40% from 2018. 2019 values are only 5% lower than pre-Harvey 2017 values.  
  • The Barrington (55%):  Average values are up 18% from 2018. 2019 values are only 9% lower than pre-Harvey 2017 values.
  • The Enclave (20%):  Average values are up 21% from 2018. 2019 values are only 7% lower than pre-Harvey 2017 values.

Success of Protests

To illustrate the effect of successfully protesting your assessment, I analyzed the final 2018 property tax year assessments of all Kingwood Greens homes using HCAD’s public information.

On average, Kingwood Greens homeowners who protested their assessments saw significantly greater declines in their 2018 final assessments and  were assessed less per square foot compared to homeowners who chose not to protest.

About half of Kingwood Greens residents chose to accept HCAD’s initial 2018 assessments.  The average reduction in their appraised value was 25% below 2017 and average assessment per square foot was $108.

The other half (despite their assessments being down initially 21% from 2017) protested their assessments. 98% of those who completed the protest process reduced HCAD’s initial proposed assessments. Reductions ranged from as low as $4,000 to more than $500,000.  

At the end of the day, successfully protested homes were appraised 36% lower on average than in 2017 @ $96 per square foot — a far greater average reduction and lower value per square foot than the 25% and $108 per square foot realized on non-protested properties. 

Your Fair Share

To ensure you pay only your fair share of taxes this year, it seems prudent to consider filing a protest when you receive your notice. You have 30 days from the date of the notice to file the protest which can be done either electronically on the HCAD.org website or by mail. Your assessment notice will include instructions on how to protest.

Once HCAD receives your protest, you will receive an informal hearing date. You can also access electronically the sales and other evidence HCAD used to determine your assessment.

You may represent yourself in the protest process or hire a consultant to represent you. Should you hire a consultant, the consultant’s fees can reduce any savings you realize by up to 50%.

Additional Clarifications and Thoughts

  • By law, property must be appraised at Market Value as of January 1 each year, and then taxed at the Appraised Value (less exemptions). Your 2019 assessment is based on market value as of January 1, 2019.
  • Notice that your 2019 assessment notice references two values: Market Value and Appraised Value.
  • Market Value is the price at which a property would transfer for cash or its equivalent under prevailing market conditions. Keep in mind this is the value you will be challenging if you protest, not Appraised Value.
  • The appraisal district compares your property to similar properties that recently sold. Then they adjust for differences to arrive at an opinion of market value. Bottom line: Sales of homes comparable to yours are the basis of assessments.
  • When protesting, make sure HCAD has based its opinion of your home’s market value on properties that are truly comparable.  Valid comparable sales need to be located in the same general neighborhood. Valid adjustments recognize differences such as size, age, condition, quality of construction and additional features (pool vs. no-pool, for example).  
  • Especially important: Flooded home market values should not be based on sales of non-flooded homes (or vice versa).  
  • If your home was still under repair as of January 1, 2019, make sure HCAD recognizes the proper stage of completion of your repairs as of that date. Ensure you are not valued as completely restored or at too great a percentage of completion.
  • Your tax liability depends on your Appraised Value (less any exemptions you qualify for). Its capped at an increase of 10% above the prior year’s Appraised Value (provided you have not improved the property—i.e. increased the size of the property, added a pool, etc. in the past year).
  • Important to note:  If your flooded home was not completely restored by January 1, 2018, for tax year 2019, that cap is 21% above your 2017 assessment, not 2018 assessment.   
  • If you completed flood repairs by January 1, 2018, the 10% cap over last year’s appraised value applies.

Remember: Equity Also Matters

One last issue to bear in mind:  Don’t forget equity! Just as all properties are legally mandated to be valued at market value, the law also requires each appraisal to be equitable in relation to the median level of appraisal of comparable properties (after the adjustments mentioned above). This requires comparing your assessment to those of comparable homes in your neighborhood to ensure you are equitably assessed and paying only your fair share.  An inequitable appraisal is also grounds for protest.

May 7 Flood Victims Must Wait Until Next Year

Any flooding that occurred to homes in early May was past the January 1 assessment date. By law, the 2019 values must be based on market value of properties as of that date and taxing jurisdictions cannot request disaster reappraisals without a disaster declaration. Therefore, the 2019 assessments of people who flooded on May 7 will not reflect losses in market value due to flood damage, but may impact their 2020 assessments.

By Bill Fowler, 6/10/2019

650 Days since Hurricane Harvey

Report on September Meeting of Lake Houston Area Grassroots Flood Prevention Initiative

Matt Zeve, Bill Fowler and I each made presentations at the Lake Houston Area Grassroots Flood Prevention initiative this evening.

Zeve Addresses Flood Bond and Flood Map Updates

Zeve, Director of Operations for Harris County Flood Control District spoke about the recently approved $2.5 billion Harris County Flood Bond and updates to flood maps. He indicated that timetables for projects should be completed within the next several weeks. He also indicated that the county has already approved drainage work in Huffman and fielded numerous questions from the audience about Taylor Gully, Ben’s Branch, upstream detention and more. Zeve expects flood maps to be updated in 2021 and stated that mitigation efforts could affect those, but that homeowners will have a chance to appeal them.

Rehak Presents Updates on Dredging, The Mouth Bar and Sand Mining

Bob Rehak updated residents on .Dredging, The Mouth Bar and Sand Mining. Dredging, he says, officially started today though not in the way that some expected. The first of two dredges launched today, a 270-ton diesel powered dredge. The launch had been delayed by a key part that had to be remanufactured and reshipped, then inclement weather. The tall construction cranes had to shut down every time lightning was heard in the area because they act like lightning rods. When the dredge finally started making it’s way downriver today, a mechanical dredge had to clear the way. The river was 18 inches deep in places but the dredge draws 3.5 feet of water. That’s how bad the sedimentation was; we needed a dredge for the dredge.

Dredging will take place to the left of the white line, but not to the right. Chimichurri’s in Kings Harbor is the dividing line. Those thousands of numbers on the image represent survey points by the Army Corps Average depth around the mouth bar is 1-3 feet. Max depth is 5 feet in some cross sections. Water will actually have to flow uphill about 40 feet to get past the mouth bar.

Dredging will start near Chimichurri’s just east of West Lake Houston Parkway. The Corps and Great Lakes will then work their way back toward River Grove Park. They expect to finish dredging by April 1, next year. Demobilization could take until early May.

Rehak also addressed the issue of the mouth bar and updated residents on political efforts by City, County, State and Federal officials to jumpstart the next phase of dredging before this one ends so that $18 million in mobilization and demobilization fees do not have to be duplicated for a second job. No plans have gelled yet, but Houston City Council Member Dave Martin may have an announcement to make at his Town Hall Meeting on October 9.

The final part of Rehak’s presentation addressed efforts to reduce sedimentation at its source to reduce the cost of dredging over the long run. Potential solutions include upstream detention, sand traps, and legislation or regulation that changes the way sand mines operate. Rehak specifically mentioned that moving sand mines out of the floodway would solve a host of problems.

Grassroots Co-Chair Clarifies Lake-Lowering Policies, Floodgate Possibilities, and Need for Flood Insurance

Bill Fowler, co-chair of the Lake Houston Area Grassroots Flood Prevention Initiative, opened the meeting by updating the community on policies to coordinate the lowering of Lake Conroe and Lake Houston to provide residents with extra protection from flooding when severe weather is expected. Fowler also gave an update on additional flood gates for Lake Houston. Then he discussed flood insurance and the related issue of redrawing flood plain maps which Harvey made obsolete. Copies of Fowler’s presentations can be found here.

Zeve did not work from a presentation. His remarks were supported by material from the Harris County Flood Control District website. He did, however, specifically urge residents to review the ever expanding Kingwood section of the site.

Diverse Audience of Approximately 200

Approximately 200 residents attended the meeting. Surprisingly, about a third of those did not flood during Harvey. The large turnout by non-flooded residents may have had to do with the flood insurance theme. Fowler emphasized that everyone needs flood insurance;

45 percent of the people who flooded in Harvey were outside of the 500-year flood plain and 64% of those did not have flood insurance.

Thanks to Volunteers

Many thanks to Dianne Lansden, also a co-chair for the Lake Houston Area Grassroots Flood Prevention Initiative for coordinating the meeting; Fran Barrack for refreshments and Bill McCabe for sign ins.

Posted by Bob Rehak on September 18, 2018

385 Days since Hurricane Harvey