Appraisal Standards Review
Atascosa County Appraisal District Follow-Up Report
May 2007
Summary
In July 2004, the Comptroller’s Property Tax Division (PTD) identified Charlotte Independent School District (Charlotte ISD), located in Atascosa County, as one of 54 school districts in the state meeting the criteria that initiate an appraisal standards review (ASR) of the county appraisal districts that serve them. In July 2005, PTD released the results of its ASR of the Atascosa County Appraisal District (Atascosa CAD).
ASRs determine why the Comptroller’s property value study (PVS) found local values invalid and recommend changes in operations and management to improve appraisal practices. The Atascosa CAD report made 11 recommendations to improve the CAD’s appraisal practices and operations. It evaluated five functional areas: board of directors (governance and management); appraisal district policies, procedures and operations (assessment administration); information processing systems (information processing and data collection); staffing, personnel qualifications and positions (resources and management); and generally accepted appraisal practices.
At the time of the review, Atascosa CAD faced challenges in stabilizing district leadership and management; documenting procedures and appraisal methods; and conducting regular reappraisals.
Texas Property Tax Code Section 5.102(d) requires that if the appraisal district fails to comply with the recommendations in the report and the Comptroller finds that the board of directors of the appraisal district failed to take remedial action before the first anniversary of the date the report was issued, the Comptroller shall notify the judge of each district court in the county for which the appraisal district is established. The judges appoint a five-member board of conservators to implement the recommendations. The board of conservators shall exercise supervision and control over the operations of the appraisal district until the Comptroller determines that each school district for which the appraisal district appraises property has the same taxable value as the local value for the school district in the same year. The appraisal district shall bear the costs related to the supervision and control of the district by the board of conservators.
For the one-year follow-up report, an appraisal district is in compliance with statute if it takes remedial action to implement the recommendations in the ASR. Remedial action means that the CAD has corrected, remedied or improved the deficiencies identified in the ASR or intends to do so. Remedial action is demonstrated by having implemented or nearly completed the preponderance of the recommendations by the first year anniversary of the release of the report, and, in some instances, some of the recommendations with a strong commitment by the board to complete the remaining recommendations in a timely manner. The Comptroller recognizes that some ASR recommendations require more than a year to implement. Some ASRs include more recommendations than a CAD with limited resources can implement within a year. So long as the CAD is working at remediation of the findings, the Comptroller will continue to work with the CAD to achieve full compliance and will continue to monitor the CAD’s performance until it implements all recommendations. The Comptroller considers CADs that have completed all recommendations by the one-year anniversary to have met their statutory obligations and will not require additional monitoring.
In this report, PTD assesses Atascosa CAD’s progress toward implementing the original report’s recommendations. While some work remains, PTD found clear evidence that Atascosa CAD made significant progress in implementing its recommendations. The CAD implemented seven of the 11 ASR recommendations and is in various stages of progress toward completing the remaining four.
PTD sent the CAD’s board members surveys soliciting their views and comments on the ASR. Two board members responded; both agreed that the ASR contained useful suggestions and that the board of directors supports PTD’s recommendations. The board members further indicated that the review provided focus and direction for the appraisal district. Finally, the board members responded that the board and administration are working together to implement the recommendations and that the appraisal district has made significant progress in doing so.
PTD will continue to monitor the Atascosa CAD’s progress. This report outlines steps the CAD still must take to complete implementation of the recommendations.
History and Significant Events
Atascosa CAD received an ASR because the PVS found the property values for Charlotte ISD invalid; the school district became eligible for a “grace period” as provided for in Government Code Section 403.3011.
In 2003, the PVS found Qualified Agricultural Land, Subcategory D1, outside the margin of error for all five school districts within Atascosa CAD. Subcategory D1 was the major factor causing PTD to assign Charlotte ISD an invalid finding. The variance in the other school districts was not sufficient to cause their overall value to fall outside the acceptable standard, thus qualifying them for a grace period. Neither Atascosa CAD nor any of the school districts filed protests of the 2003 study.
The CAD has experienced significant turnover at the chief appraiser and staff positions in recent years. It has had six chief appraisers since January 2000, with four of the six, including the current chief appraiser, serving as interim chief appraisers. Since PTD issued the ASR report in July 2005, new employees have filled six positions:
- interim chief appraiser;
- deputy chief of operations and commercial property;
- deputy chief of residential and agricultural properties;
- office manager;
- receptionist; and
- appraiser.
In addition, the board has two new members representing Pleasanton ISD and the city of Jourdanton, respectively.
The 2004 and 2005 PVS found values in all Atascosa ISDs valid. The preliminary 2006 PVS found values in Charlotte and Poteet ISDs invalid.
Status of Recommendations;
What Remains to Be Done
Appendix A lists the 11 recommendations identified in the original report, with a summary of actions taken to date. Atascosa CAD implemented nine recommendations and is working toward completing the remaining two.
PTD will continue to monitor Atascosa CAD operations and will require quarterly reports until all recommendations are complete. Atascosa CAD must complete the recommendations within one year of the issuance of this report. The following recommendations require additional work.
Recommendation 1: Expand the detail of the budget presented to the board of directors for adoption to include the benefits for each position and a list of each proposed capital expenditure with sufficient detail to allow comprehensive decision making by the CAD board and taxing units and hold budget hearing on a timely basis.
On August 25, 2005, the Atascosa CAD board approved its 2006 budget for consideration by the taxing entities. Property Tax Code Section 6.06(a), however, requires this action by June 15.
Unlike previous years, the CAD included in its 2006 budget a salary and benefit schedule detailing benefits for each staff position, but, as in previous years, the CAD did not provide a breakdown of capital expenditures, as required by Property Tax Code Section 6.06 (a).
On July 21, 2006, the CAD board approved the 2007 operating budget for tax entity consideration. The 2007 budget also includes a salary and benefits schedule that lists benefits per position, but, as with the 2006 budget, it lacks sufficient detail for capital expenditures to meet the Property Tax Code requirement.
Atascosa CAD made progress toward meeting this recommendation by listing benefits per position in its 2006 and 2007 budgets. To comply with PTD’s recommendation, the CAD’s future budgets must include detailed information on capital expenditures and the CAD must submit them to the taxing entities by June 15, as required by law.
Atascosa CAD must approve and send the 2008 budget to its taxing entities before June 15, 2007, and send a copy, including board minutes, to the Comptroller’s office by July 1, 2007.
Recommendation 3: Develop a comprehensive written policy and procedures manual for district operations.
The CAD has separate manuals outlining procedures for processing deed transfers and exemption applications; administering 911 addresses; and gathering and analyzing sales data. It is also developing a procedures manual for CAD operations. Due to the high turnover rate in the chief appraiser and staff positions, the CAD has been unable to develop a comprehensive operations manual.
An effective policy and procedures manual for CAD operations will address each facet of day-to-day operations, with different sections for each department and detailed procedures for each departmental function, documenting which staff member is responsible for each task.
To comply with this recommendation, CAD managers should examine their office duties in detail and develop a comprehensive policy and procedures manual for all operations. The CAD board should adopt the manual and send a copy to the Comptroller’s office within 30 days, but no later than June 30, 2007.
To comply with this recommendation, the CAD should incorporate the appraisal policies and procedures from the mass appraisal report, the field appraiser handbook and the residential classification guide into a single manual (or one manual for each property type). It should also add property classification pictures, descriptions, and detailed local policies and procedures for each type of property the district appraises.
The manual will show employees the steps a CAD appraiser takes in performing an appraisal and arriving at an appraised value. The manual will be an important training tool for new appraisers and guide the appraisal department toward more accurate and uniform appraisals.
Appendix A
Atascosa County Appraisal Standards Review Implementation Status Report
2.1 Board of Directors
| Rec. # | Recommendation | Implementation Status | If not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 1 | Expand the detail of the budget presented to the board of directors for adoption to include the benefits for each position and a list of each proposed capital expenditure with sufficient detail to allow comprehensive decisionmaking by the CAD board and taxing units and hold budget hearing on a timely basis. | In Progress | July 1, 2007 |
Atascosa CAD listed benefits per position in the 2006 and 2007 budgets. To comply with this recommendation, the CAD’s future budgets must include detailed information on capital expenditures, and the CAD must send its budget to the taxing entities by June 15, as required by law. Atascosa CAD must approve and send the 2008 budget to its taxing entities before June 15, 2007. A copy of this action, including board minutes establishing when the board took the action, must be sent to the Comptroller’s office no later than July 1, 2007. |
| 2 | Develop a job description and an objective set of evaluation measures for the chief appraiser position and establish an annual evaluation process based on objective measures. | Complete |
To comply with this recommendation, the CAD developed two ways to evaluate the chief appraiser: a job description and a set of goals. The CAD developed a job description for the chief appraiser, including qualifications for the position, and principal duties and responsibilities. The duties and responsibilities section includes 13 evaluation measures, many tied to requirements of the Property Tax Code. The 16-page document revised details all the areas for which the chief appraiser is responsible. The CAD developed five rating scores in evaluating the chief appraiser. The rating scores are: unsatisfactory performance—below expectations; marginal performance; satisfactory performance—meets expectations; above expectations; and exceptional performance. For unsatisfactory performance and exceptional performance ratings, board members must cite specific examples. Each board member will conduct this evaluation annually during the executive session of the October board meeting. In addition to the job description, the CAD developed a document listing key goals for the chief appraiser. The board will perform a mid-year review of progress and year-end evaluation of each goal. The following is an example of one of the goal statements: “Achieve the requisite levels of appraisal uniformity as determined by the Comptroller’s Annual Property Value Study to secure local value for all Atascosa County ISDs.” On May 18, 2006, the board approved the job description and evaluation measures for the chief appraiser. The board hired the current interim chief appraiser on January 3, 2006 and has not evaluated his performance yet because he has not served in the position for a full evaluation cycle. |
2.2 Appraisal District Policies, Procedures and Operations
| Rec. # | Recommendation | Implementation Status | If not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 3 | Develop a comprehensive written policy and procedures manual for district operations. | In Progress | June 30, 2007 |
The CAD has separate documents containing procedures for processing deed transfers and exemption applications, administering 911 addresses, and gathering and analyzing sales data. High turnover in the chief appraiser and staff positions has prevented the CAD from developing an operations manual. The CAD is doing so now. Once the board adopts the operations manual, the chief appraiser should send a copy to the Comptroller’s office within 30 days but no later than June 30, 2007. |
| Rec. # | Recommendation | Implementation Status | If not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 4 | Develop a timeline and implementation plan for completing the mapping and integration of the district’s GIS mapping system and appraisal system. | Complete |
In February 2006, the board contracted with Stewart Geo Technologies (SGT) to provide the CAD with aerial photography and digital orthophoto topographic data. In March 2006, the parties amended the contract to include the mapping of all real property parcels in Atascosa County. The amended contract states “parcel data layers to be captured are right of ways, parcels, lot and blocks, subdivision, easements and abstract lines.” SGT provided a detailed timeline in a project table indicating the project will be complete by December 29, 2006. The company reports the status of the project using the table. SGT estimates delivery of parcel mapping six months after completion of county orthophotography, which is digital imagery that removes the distortion from the camera angle and topography to equalize the distances represented on the image. The estimate is dependent on receipt of deeds. This contract, with timelines, complies with this recommendation. |
2.4 Staffing, Personnel Qualifications and Positions
| Rec. # | Recommendation | Implementation Status | If not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 5 | Develop a timeline and plan for updating the district’s personnel policy. | Complete |
On May 18, 2006, the board ratified the current employee policy and procedures manual. Management gave employees copies of the manual on June 2, 2006. Each employee signed a statement of acknowledgement on June 8, 2006. Major sections of the manual include:
The manual also includes job descriptions and employee evaluation measures. In addition, the manual includes a computer policy section. Computer policy regulations include e-mail usage, misuse of e-mail or the Internet, and computer security. The CAD is developing additional policies covering the Family Medical Leave Act. |
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| 6 | Develop job descriptions and adopt an annual personnel performance evaluation system to use in evaluating all district staff. | Complete |
Atascosa CAD developed job descriptions for each position and evaluation measurements where none existed before. The CAD developed job descriptions for the following positions:
The CAD also developed a performance evaluation report that evaluates an employee on 15 performance factors, including job commitment, job knowledge, and work quantity and quality. The report describes each performance factor and rates employees on a one to five point scale, with a three defined as “meeting expectations.” For example, a rating of three under quality and quantity of work states “few errors, average quality and quantity of work; corrections made in reasonable time.” The CAD evaluated its employees in August 2006. |
2.5 Generally Accepted Appraisal Practices; Equality and Uniformity of Appraisal Standard
| Rec. # | Recommendation | Implementation Status | If not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 7 | Develop procedures for administering exemptions, processing deed transfers and administering 911 addressing. | Complete | In June 2006, the CAD developed procedures for administering exemptions. The procedures covered include processing residential homestead exemptions, including those for people 65 and older, the disabled and disabled veterans. Each procedures reference requirement is in the Property Tax Code. The CAD is providing employees with training in qualifying taxpayers for exemptions. Also, during June, the CAD developed procedures for processing deed transfers. The procedures include 15 steps and a five-week timeframe for researching the deed and entering deed information into the CAD’s computer system. The procedures also indicate that the CAD cross-trained three employees to help process deeds. Finally, the CAD developed procedures for administering 9-1-1 calls. The procedures include the required contents of a work order; the calculation of the correct location of the property for tax purposes; maintenance of an emergency database; and database error correction. |
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| 8 | Adopt a detailed reappraisal plan that, at a minimum, includes the vital steps in the process, explains exactly how and when the steps will be executed, and explains how sufficient resources will be allocated to follow the plan. | Complete | The CAD completed the 2006 reappraisal work without documentation due to the recent hiring of the interim chief appraiser and other staff members. The chief appraiser developed a comprehensive reappraisal plan. The plan includes a detailed calendar showing when and how the CAD will perform reappraisal activities. The board approved the mass appraisal report and submitted it to the Comptroller on March 29, 2007. | |
| 9 | Prepare and issue to each appraiser detailed appraisal procedures manuals that provide local procedures and practices for each type of property the staff appraises and tie these local procedures to the existing Marshall & Swift procedures and USPAP Standard 6. | Complete | The CAD incorporated the appraisal policies and procedures from the USPAP Mass Appraisal Report, the Atascosa Field Appraiser Handbook and the residential classification guide into a single manual. The manual also should include property classification photos and descriptions as well as detailed local policies and procedures for each type of property the district appraises. The CAD provided PTD with a copy of the manual on March 29, 2006. | |
| 10 | Establish written procedures for gathering and analyzing sales. | Complete |
The CAD developed a one-page document outlining procedures for gathering and analyzing sales information. The document includes: three sections covering the primary sources of sales information; secondary sources of sales information; and procedures for analyzing sales information. While the CAD has complied with the recommendation, it should bolster the procedures by describing them in more detail. For example, in the gathering of sales data, it could add information on what constitutes an “arms-length” transaction. In recording sales information, it could include content on how the CAD adjusts sales for financing. It could also add additional information on ratio studies and the different statistical measures the CAD employs. |
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| 11 | Annually calculate productivity values for land designated for agricultural use as required by Section 23.41 and Section 23.51 Tax Code. | Complete |
To comply with this recommendation, the CAD developed an agricultural valuation manual. The manual contains:
In addition, the manual contains 2004 lease data used for the 2006 agricultural schedules. The manual divides the lease data by land use (dry cropland, irrigated cropland, improved pasture, native pasture, brush and peanuts) and provides lease prices per acre submitted from area farmers and ranchers. This section also includes hunting lease data. The manual also lists the 2006 net-to-land calculations for each land class with corresponding expenses (taxes, insurance and fences). Moreover, it gives a five-year (2000-2004) net-to-land chart with net-to-land averages, cap rates and productivity value per land class. Finally, the manual shows the 2006 productivity schedule for qualified agricultural land along with a 2005 and 2006 comparison of values. For documentation purposes, the CAD provided an explanation of expenses used in the net-to-land calculations along with copies of the productivity questionnaires received from property owners. |