Residents discover undervalued properties
By 04/19/2007 00:00:00
ELLIS COUNTY - For years, Ellis County homeowners have complained their property values have increased unfairly and caused their taxes to grow, but several Ellis County residents want to know why certain properties have been grossly undervalued.
Questions have been raised by several Ellis County residents about the practices of the appraisal district when it comes to valuing their property and the surrounding properties.
One resident said, 'New home buyers are paying more tax dollars and are subsidizing older properties that are not valued at realistic market sales prices.'
One property mentioned was sold for $400,000 in 1998 but the appraisal showed it was only worth $68,400.
This same property continued to fluctuate in appraised value throughout the years.
The property went from the original appraisal to the buildings having little value or no value at all, to the buildings being valued at $411,000.
'My property values have increased every year,' said Ken Halverson, a local resident whose property connects to the one in question.
'Property going down in value is absolutely ridiculous.'
Kathy Rodrigue, chief appraiser of Ellis County, said, 'Yes, all of these documents (documents showing the appraised value over an eight year period) are at least in part the same property.
'This is a very unique property and in the appraisal process, an appraiser is first required to look at the highest and best use of the property.
'These buildings are not valued in many of the years because the highest and best use of the property was determined in those years to be as vacant land with no contributory value for the very unique buildings.'
This property increased in value some years and lost value in other years, then jumped up considerably when shown for sale in 2005 for $1.5 million.
Of course, this was not one of those years the buildings had any value, according to appraisal records the buildings were worth $10 in 2005.
'Yes, this property owner had and may still have the property listed for $1.5 million, but that only establishes an asking price, not a market value since the facility has not sold for that amount,' Rodrigue said.
'Anyone can ask anything for a property, but again an asking price does not establish market value.'
Whatever was done to the property over the course of the next year made those values finally go up and the appraised value was $411,000 for the buildings and $374,890 for the property even though local residents said there was nothing done to the property.
'For 2006 the property owner filed a motion for substantial error claiming that the building needed to be removed,' said Rodrigue.
'No adjustment was made to the 2006 value because the property owner was not in timely compliance with the law.
'Currently land values in this area are ranging from $3,000-$4,000 for a vacant tract of this size; this would indicate a market value not in excess of $460,000.'
None of the vacant land appraisals throughout the previous seven years were close to this market value until the buildings became valuable again.
Rodrigue said, 'If it costs, as indicated in the property owner's motion, approximately $200,000 to remove the building, the resulting value of the remaining raw land would be $260,000.
'This value is not unlike the 2003-05 values.'
Some residents questioned why the appraisal district was reducing the value of vacant land because of the cost of removing buildings which were not considered valuable in the first place.
Throughout the appraisal of the property - some years the buildings were valued at about $215,000, some years $10, some years $0, and finally $411,000 without any improvements being done to the buildings.
A comparison of properties in the Midlothian area was provided by someone close to the appraisal district listing eight different properties which showed discrepancies between the market value and the appraised value.
'In determining the accuracy of the Ellis County Appraisal District and the impact its valuations may have in determining values on our properties, I did a quick comparison on recent real estate sales in Midlothian,' he said.
'In every instance I reviewed, the appraisal district is significantly undervaluing property.'
While some homeowner's property values continued to increase, others seemed to stay the same or even decreased in value, especially on large pieces of land.
'It also means higher tax rates for us all because we are having to pay more because so many are being under valued,' said the resident.
Some of those properties in the comparison showed the difference between the appraised value and the selling value anywhere from $13,999 to as much as $54,125.
'The appraisal district appraises property as of Jan. 1 of each year and uses all known sales information to estimate market value,' said Rodrigue.
'Several of the listed sales indicated that they had been updated or remodeled.
'Also, the sales prices on several of these are different than the sales prices the appraisal district has received.'
Another area of concern brought up by someone close to the appraisal district was the property value study.
'One of the main purposes for the property value study is for the allocation of state funds for local school districts,' he said.
'The study is done for each school district to prove that they are appraising all property at market value.
'What the appraiser did was a move most likely because the property was transferred late just before notices of appraised values were to hit the mail and what they did was protect the appraisal district at the expense of other taxpayers.'
According to R. J. DeSilva, spokesperson for the Texas Comptroller, 'After looking at the documents this property was not in the property value study.'
'We (the comptroller's office) take a sample of the sales data to do the study and since this property was not in the study it would not affect the Property Value Study.'
This was the point the resident was making, the property was transferred in order for it not to be on the value study.
DeSilva did suggest, in terms of the Property Value Study, to contact the property tax manager who has not currently responded to Ellis County Press inquiries.
Rodrigue did not respond to the questions about the documents sent to her about the value study even though she referred to the Property Value Study which was completed in 2005 and indicated the Ellis CAD was appraising property at 100 percent of market value.
One resident said, 'Vacant lots in my subdivision vary in appraised value as much as 300 percent and are still less than 50 percent of current sales prices.
'There are instances I am personally aware of lots sold for $10,000 and still carried on the tax rolls for $2,000.'
The resident also brought up a possible conflict of interest in which one of the appraisers had taken Rangers box seats from a large property owner which he said he was personally aware.
Rodrigue stated, 'Regarding John Ostendorf receiving Rangers box seats, is easily answered and the answer is no.
'There is no disputing that an agent for a large property owner offered Mr. Ostendorf these seats. Mr. Ostendorf immediately made me aware of the offer and that he declined to accept the seats.'
'The appraisal district cannot control what a property owner may attempt to do; we, however, do have responsible staff that recognizes an inappropriate offer.'
The Ellis County Appraisal District may have missed the mark on several occasions and these are only a few properties which were looked over but Rodrigue has certainly answered all questions pertaining to the items in question.
'I certainly understand your interest in the information you sent me,' said Rodrigue.
'Transparency in those of us who serve the public is a must and I am happy to be given an opportunity to respond to the data that was sent to you (The Ellis County Press).'