Harris County is challenging the local appraisal district’s valuation of vacant commercial land after a study it commissioned concluded the agency had undervalued those properties by more than 80 percent this year.
The finding was based on a random sampling of two dozen vacant commercial properties across the county with a collectively assessed value of $75.3 million. College Station-based consultant Ted Whitmer found those vacant lots – among nearly 30,000 on the rolls – were worth a combined $140.8 million, or 83 percent more.
The County Attorney’s Office filed a challenge based on the preliminary findings with the Harris County Appraisal District on Monday, the deadline to submit challenges. The action could evolve into a lawsuit if the district’s Appraisal Review Board does not settle, but agency and county officials said they hope to avoid that.
Unlike home and business owners, who can protest appraisal values for individual properties, the county can challenge appraisal values only for entire categories of property. Vacant commercial properties make up about 2 percent of the county tax base.
Harris County Commissioners Court voted in February to hire Whitmer to monitor the appraisal district’s valuations of all commercial properties, concerned the appraisal district could be undervaluing certain business properties at the expense of homeowners.
Precinct 3 Commissioner Steve Radack, who requested the study, said at the time that district’s Appraisal Review Board in recent years had agreed to set values for commercial and industrial properties far below what those properties later sell for, suggesting the independently governed agency did not adequately fight property owners who challenged their appraisals in court.
Whitmer’s study found that the appraisal district largely had accurately appraised commercial properties, including downtown skyscrapers and apartment complexes. That is a sign, according to one HCAD critic, that agency efforts to more accurately appraise business properties have paid off.
“I am delighted that we have reached the point where the Harris County Appraisal District, the largest appraisal district in Texas, is vastly closer to true market value,” said blogger George Scott, who worked for the district as a spokesman until 2012.
Scott said the report will help the appraisal district defend values in court against deep-pocketed companies trying to lower their appraisals for commercial and industrial properties.