Overview of County Appraisal District
County History and Demographics
According to the Handbook of Texas, Archer County was formed out of Clay County in 1879 and organized in 1880. The county was named for Republic of Texas commissioner Branch Tanner Archer.
Archer County is in north central Texas, bounded on the North by Wichita County, on the west by Baylor County, on the south by Young County, and on the east by Clay and Jack Counties. Archer City is the county seat and is located at the intersection of State Highways 75 and 59.
Livestock and livestock products accounted for the majority of the income in the county until the depression when petroleum production took over.
The population of the county for 2003, according to the County Information Project, was 9,189 residents, with the City of Windthorst having 443 residents, the City of Scotland having 254 residents, the City of Megargel having 254 residents, the City of Lakeside City having 1,035 residents, and the City of Holliday having 1,710 and Archer City having 1,893. The balance of the residents of the county population live in smaller cities and towns and the rural areas. The county comprises 926 square miles, mainly of grassy plains.
The county includes the Archer City Independent School District, Holliday Independent School District, Megargel-Groves Independent School District, and Windthorst Independent School District.
Appraisal District Organization and Staffing
The appraisal district was formed in 1981 and became active in 1982. Archer CAD has a total of three full time staff with one chief appraiser, one assistant chief appraiser and one appraisal clerk. The district contracts with Pritchard & Abbott, Inc. for professional appraisal services on mineral and industrial appraisals.
Exhibit 1 outlines the district organization.
Scope of Office
The Board of Directors has no authority to set values or appraisal methods. The chief appraiser carries out the appraisal district's legal duties, hires the staff, makes the appraisals and operates the appraisal office.
The district provides appraisal services for ten taxing units, Archer County, Holliday Independent School District, Archer City Independent School District, Megargel Independent School District, Windthorst Independent School District, City of Archer City, City of Holliday, City of Lakeside City, City of Megargel, and City of Windthorst.
Exhibit 2 presents the types of properties appraised by Archer CAD in tax year 2003. In-house staff handles all property categories except Category G (minerals), Category J (utilities), and part of Category F2/L2 (industrial - real/personal), which is appraised by P&A.
Archer CAD Property by Category Summary with Assigned Responsibility
Property Category Account Type Description Responsible for Appraisal Category A Residential In-house staff Category B Multi-Family In-house staff Category C Vacant Lots In-house staff Category D/E Farm/Ranch Land w/Impr. In-house staff Category F1 Commercial Real In-house staff Category L1 Commercial Personal In-house staff Category G Minerals Contracted Appraisal Firm Category J Utilities Contracted Appraisal Firm Category F2 Industrial Real In-house & Contracted Appraisal Firm Category L2 Industrial Personal Contracted Appraisal Firm Source: Archer CAD, April 2005.
Most appraisal districts contract out some of its appraisal to contract appraisal firms. PTD does not track parcel counts appraised by external appraisers in appraisal districts. Appraisal district contracts with external appraisers routinely do not include a parcel count for the number of appraisals an external appraisal company will perform. In assessing the staff to parcel count ratio in each appraisal district, PTD uses parcel counts reported in the district's 2003 self report and the county's independent school districts self reports to calculate the parcels per appraisal district staff. PTD does include all of the commercial real and personal property parcels in the calculation, since PTD is unable to determine exactly how many parcels are assigned to in-house staff versus a contract appraisal firm. The total parcels appraised in-house are calculated by summing the total number of parcels reported in Categories: A, single family residential; B, multifamily residential; C, vacant lots; D, rural land; E, rural improvements; F1, commercial real property; L1, commercial personal property; M1, mobile homes; O, residential inventory; and S, special inventory, as shown in Exhibit 3.
Reported Data on Parcels, Categories Staffing, Training and Operations Comparison to State and Group Averages
General Information Archer State Avg. Group Avg. Parcel Size Group (by number of locally appraised parcels) 10,000 - 14,999 Estimated # Locally Appraised Parcels 10,302 55,463 12,441 # Taxing Units 10 15 7 Locally Appraised Parcels to Staff 3,434 3,404 2,615 2003 Composition by Percentage
of Value (Self Report):
Archer State Avg. Group Avg. Residential Value 35.8% 52.6% 17.7% Non-Residential, Non Mineral 56.9% 43.6% 54.8% Non-Residential, Mineral 7.3% 3.7% 27.5% 2003 Composition by Account Category Type (Operations Survey): Real Property 10,272 45,804 13,246 Mineral Property 6,638 13,536 13,245 Business Personal Property 407 4,689 649 Individual Personal Property 422 1,342 312 Total Accounts 17,739 65,372 27,451 2003 Composition by Locally Appraised Parcel Category (Estimated from Self Report): Archer State Avg. Group Avg. Parcel Type # Parcels % of Parcels A 3,168 30.8% 44.1% 26.1% B 9 0.1% 1.0% 0.3% C 1,017 9.9% 13.1% 15.3% D 4,041 39.2% 24.7% 36.1% E 1,248 12.1% 4.5% 12.5% F1 295 2.9% 3.1% 3.4% L1 379 3.7% 5.7% 3.7% M1 135 1.3% 2.2% 1.9% O 10 0.1% 1.4% 0.3% S 0 0.0% 0.1% 0.5% Total 10,302 100.0% 100.0% 100.0%
PTD estimated that Archer CAD staff is responsible for appraising about 10,302 parcels. The International Association of Assessing Officer (IAAO) Standards state that small taxing units run from 1,500 to 1,700 parcels per staff member and large taxing units run from 3,000 to 3,500 parcels per staff member with an average of 2,500.
Districts comparable in size to Archer are Floyd, Mason and McCulloch. The number of parcels per staff member for Archer CAD was 3,434. Floyd CAD was 2,127, Mason CAD was 2,718 and McCulloch CAD was 2,991. Of course, workloads in appraisal districts may vary, sometimes drastically, due to any number of considerations other than parcel count. Geography or the size of an appraisal district may have a significant impact on the time required to work all parcels. The types of properties may also have an impact. More complex commercial and sometime even residential properties may require more staff to appraise. The data given here is meant to give the reader at least some comparison to other appraisal districts with similar parcel counts and the standards determined by IAAO.
Exhibit 3 includes reported data concerning CAD and state and group averages.
Reported Data on Parcels, Categories Staffing, Training and Operations Comparison to State and Group Averages (continued)
Financial and Staffing
Information (Operations Survey)
Archer State Avg. Group Avg. 2003 Budget $213,100 $1,079,695 $273,141 2003 Surplus $9,000 $71,620 $15,867 2003 Surplus as % of Budget 4.2% 6.6% 5.8% 2004 Budget $215,750 $1,104,961 $281,073 % Change in Budget 1.2% $0 2.9% 2004 Budget per Total Local Parcel $20.94 $19.92 $22.59 Staffing Full Time 3 18 5 Part Time * 2 1 Supervisory 1 3 2 Programmers * 2 1 Supervisory to Staff Ratio 1:3 1:5 1:3 Chief Appraiser Performs Appraisals? Yes 2004 Total Compensation $32,000 $53,564 $44,270 Appraisers Full - Time 1 8 2 Part - Time * 0 1 Salary Range: Low $18,500 $24,504 $24,638 High $18,500 $37,521 $28,640 Training Budget $4,500 $8,832 $4,153 # Registered with BTPE (1) 2 9 4 Types of BTPE Certification: RPA (2) RTA (3) RTC (4) All 1 0 0 0 Operations Information
Archer State Avg. Group Avg. Reappraisal Last Year of Reappraisal 2003 Next Year of Reappraisal 2004 Type of Appraisal: Complete Method of Appraisal: Combination Protests 60 3,131 113 Protests per Parcel 0.3% 4.7% 0.4% Consolidated Collection No Collection Budget $0 Geographic Information System (GIS)? Yes Percent GIS Complete 80% 80% 84% Board of Directors Members 11 6 6 Tax Assessor Votes? Yes Elected Members 9 3 3 Note: An asterisk (*) is shown where data was not reported.
Source: Archer CAD's and ISDs 2003 Self Reports and Comptroller 2003-2004 Appraisal District Operations Report and Comptroller comparative data for state and group averages from district self reports and the Appraisal District Operations Report.
Notes: (1) BTPE - Board of Tax Professional Examiners. (2) RPA - Registered Professional Appraiser. (3) RTA - Registered Texas Assessor-Collector. (4) RTC - Registered Texas Collector.
Self Evaluation Questionnaire
In preparation for the Appraisal Standards Review, Archer CAD was requested to complete the IAAO's Self Evaluation Questionnaire. This instrument allows an appraisal district to assess their compliance with acceptable procedures, standards and organization. Each district receives an electronic version of the questionnaire and the complete IAAO manual explaining each question with information on how to answer each question. Each district undergoing an appraisal standards review is requested to perform the self assessment, with the goal of assisting the district in determining how well it is performing.
Archer County answered 106 out of 110 questions. The district gave concise responses to each question rather than providing a simple yes or no answer. The majority of the responses were in the affirmative, with 12 negative and two not applicable responses. The district gave careful consideration to each question and their answers are included in Appendix 15.
In Chapter 1, on legal issues and assessment cycles, the district noted that it has adequate staff to perform its duties.
In Chapter 2, on resource management, the district noted its office funding is sufficient, it runs a well organized and well managed operation, and the district stated its staff is quality conscious concerning their work.
Chapter 3, on computerization, indicates a working knowledge of the computer system used by the district and noted it does not provide web access to the public.
Chapter 4, on mapping, shows that the district has a mapping system with the necessary tools and information to meet the standards of assessment.
In Chapter 5, data collection, the district noted it did not use hand held computers for data collection. The district noted it does not routinely collect income data.
Land Evaluation, Chapter 6, the district answered yes to about half of the questions and noted that the district uses spreadsheets and statistical software to help develop land values. In Chapters 7, 8, and 9, on residential property valuation, commercial property valuation, and sales data, respectively, the district noted its cost schedules are fully computerized and that its depreciation schedules are based on age. The district noted it uses software tools in analyzing commercial properties.
In Chapter 10, on personal property assessment, the district noted it inspects business personal property.
In Chapter 11, on assessment administration, the district noted it does update ownership and legal description information within 30 days of a deed transfer. The district noted in Chapter 12, defense of values, that it does not obtain independent reviews when assessing difficult and complex properties.
In public relations, Chapter 13, the district noted it does not have an active public relations program, but speaks at meetings if asked.
Findings of the Property Value Study and Summary Worksheets
The Property Value Study (PVS) determines the total property value in each school district in the Archer CAD. With a few notable exceptions, all CADs and the Property Tax Division (PTD) are required by law to appraise property at market value. Agricultural land and timberland are appraised according to productivity value. Market value, in short, is the price that a property would transfer from a willing seller to a willing buyer. For it to be a market transaction, neither party may be under duress to buy or sell, the sale must be on the market for a reasonable time and the parties to the sale are not related.
Local tax roll value, or local value, is determined by the county appraisal district and submitted to PTD on its annual self-report. The PTD staff estimates the total taxable value in a school district, referred to as state value, by determining market value or by accepting the local appraised value in each property category (see Exhibit 2) in the district and then adding these category values for an overall school district value. PTD then deducts state-mandated homestead exemptions, disabled veterans' exemptions, value limitations, reinvestment zones, freeport exemptions, the loss between market value and productivity value appraisal of qualified agricultural lands, the school tax ceiling for homeowners over age 65 or disabled and other state-mandated exemptions.
PTD issues a preliminary and final PVS each year. School districts and county appraisal districts may protest the findings of the preliminary PVS through an administrative hearings process with the Comptroller, and school districts may protest the findings of the final PVS in district court. The administrative hearings process requires the protester to file a written protest with supporting documentation within 40 days of the issuance of the preliminary PVS. The PTD may amend the findings of the preliminary PVS based on the submission of the written protest, an informal hearing or a formal hearing. Formal hearings are held by a hearings examiner, appointed by the Comptroller's General Counsel, and reporting directly to the Comptroller. The hearings examiner is not an employee of the PTD.
When conducting the property value study, PTD assigns properties to various categories, such as residential, commercial and rural property. Properties are divided into categories so that like properties are assessed together.
Archer CAD did not appeal the findings of the preliminary study for Holliday ISD. Holliday ISD did not appeal the findings of the preliminary study and Holliday ISD was identified as an eligible school district in July 2004.
A review of the school districts in the county indicates that Archer CAD is consistently appraising the single-family and rural residence properties below market value as determined by the PTD. In the 2003 PVS, Holliday school district fell outside the study's statistical margin of error. Single-family residences (category A) and rural residences (subcategory D2) are the primary reasons that the school's values are not within the acceptable range determined by the study.
There are four property categories tested in Holliday ISD: (1) category A, Single-Family Residences, making up 60.8 percent of the district's value with a weighted mean ratio of 0.9377; (2) category D, Rural Real, making up 13.1 percent of the district's value with a weighted mean ratio of 0.9317; (3) category G, Minerals, making up 8.6 percent of the district's value with a weighted mean ratio of 1.0323; and (4) category J, Utilities, making up 7.7 percent of the district's value with a weighted mean ratio of 1.0101. In general, a ratio of between 0.95 and 1.05 in any property category makes it more likely that the district is appraising property within the margin of error, or that it is appraising property at or near market value, according to the PVS.
Holliday ISD's category A makes up 68 percent of the tested value. The appraisal district is placing a value on the category A single-family residences below market value with a weighted mean ratio of 0.9377. The primary value range of under appraisal appears to be single-family residences below $130,000. Category D, Rural Real also tested below market value with a weighted mean ratio of 0.9317. Category D represents rural properties and contains two subcategories: D1 and D2. Subcategory D1, Productivity Value of Qualifying Acres, is primarily farm and ranch land that qualifies for the special productivity appraisal. Subcategory D2, Non-Qualifying Acres and Farm and Ranch Improvements, is primarily rural homes and land that does not qualify for farming or ranching or timberlands. The differences in value between qualified and non-qualified rural land are often wide since D1 land is appraised using a special statutory method to determine the lands productivity value and D2 is based on what the land would sell for in an open market transaction. Holliday ISD's subcategory D1 makes up 47 percent of category D's value and 7 percent of the tested value. D1 tested with a weighted mean ratio of 1.0212. Subcategory D2, however, makes up 53 percent of category D's value and 8 percent of the school district's total tested value. D2 tested below market value with a weighted mean ratio of 0.8644. The other tested categories in the school district are within the margin of error. The low ratios in category A and D2 drops the district outside the margin of error causing the school district to be identified as eligible.
In additional to Holliday ISD, the other school districts in the county are Archer City, Megargel, and Windthorst ISDs.
Archer City ISD is within the confidence interval limit. Category A is 31 percent of the school district's value and makes up 36 percent of the tested value. The appraisal district is placing a value on the category A single-family residences below market value with a weighted mean ratio of 0.9562. Category D is 23.1 percent of the school district's value. Category D, Rural Real, is appraised below market value with a weighted mean ratio of 0.9352. Archer City ISD's subcategory D1 makes up 54.4 percent of category D's value and 15 percent of the tested value. The appraisal district is placing a value on the D1 Productivity Value properties with a weighted mean ratio of 1.0220. Category D2 makes up 45.6 percent of category D's value and 13 percent of the school district's total tested value. Overall, category D2 is being under appraised with a weighted mean ratio of 0.8492. Category F1, Commercial Real, makes up 5.9 percent of the district's value with a weighted mean ratio of 0.9739. Category G, Minerals, makes up 18.1 percent of the district's value with a weighted mean ratio of 1.0356. Category J, Utilities, makes up 9.4 percent of the district's value with a weighted mean ratio of 0.9948.
Megargel ISD is within the confidence interval limit. Category A is 13 percent of the school district's value and makes up 14 percent of the tested value. The appraisal district is placing a value on the category A single-family residences just below market value with a weighted mean ratio of 0.9903. Category D is 52.7 percent of the school district's value. Category D, Rural Real, is appraised below market value with a weighted mean ratio of 0.9575. Megargel ISD's subcategory D1 makes up 80.9 percent of category D's value and 50 percent of the tested value. The appraisal district is placing a value on the D1 Productivity Value properties with a weighted mean ratio of 1.0252. Category D2 makes up 19.1 percent of category D's value and 12 percent of the school district's total tested value. Overall, category D2 is being under appraised with a weighted mean ratio of 0.7480. Category G, Minerals, is within the margin of error and makes up 12.9 percent of the district's value with a weighted mean ratio of 0.9972. Category J, Utilities, makes up 12.2 percent of the district's value with a weighted mean ratio of 1.1507.
Windthorst ISD is within the confidence interval limit. Category A is 31.4 percent of the school district's value and makes up 37 percent of the tested value. The appraisal district is placing a value on the category A single-family residences below market value with a weighted mean ratio of 0.9765. Category D is 46.2 percent of the school district's value. Category D, Rural Real, is appraised at market value and with a weighted mean ratio of 1.0030. Megargel ISD's subcategory D1 makes up 24.9 percent of category D's value and 14 percent of the tested value. The appraisal district is placing a value on the D1 Productivity Value properties with a weighted mean ratio of 1.0286. Category D2 makes up 75.1 percent of category D's value and 43 percent of the school district's total tested value. Overall, category D2 is appraised with a weighted mean ratio of 0.9948. Category G, Minerals, makes up 3.9 percent of the district's value with a weighted mean ratio of 1.0174.
In summary, the Archer CAD should focus on category A valuation of single-family residences and subcategory D2, Non-Qualifying Acres and Farm and Ranch Improvements. Holliday ISD's category A tested below market value in all value ranges. In category D2, Non-Qualifying Acres and Farm and Ranch Improvements, three of the four school districts in the county tested well below market value. This reinforces the study's findings that single-family residences are assessed inconsistently and that primarily rural homes throughout the county are being assessed below market value.
For a statistical explanation of why the district was selected as eligible, see Appendix 18.