Overview of County Appraisal District
County History and Demographics
According to the Handbook of Texas, Collingsworth County was formed in 1876 by the Texas legislature and was named for James Collingsworth, the first chief justice of the Republic of Texas and was misspelled in the legislation that established the county.
Collingsworth County is in the Texas Panhandle and is bordered by Donley County on the west, the state of Oklahoma on the east and on the south by Childress and Hall counties. Wellington, the county's largest town and the county seat, is within 90 miles east-southeast of Amarillo.
Livestock and livestock products account for the majority of its agricultural income. Mineral resources include oil and natural gas.
The population of the county for 2003, according to the County Information Project, was 3,023 residents, with the City of Wellington having 2,129 residents. The balance of the county population lives in smaller cities and towns and the rural areas. The county comprises 920 square miles, mainly of grassy plains. The county terrain is such that about half is not suitable for farming, therefore ranching remains strong in the county.
Wellington is located at the intersection of U. S. Highways 83 and Farm to Market Road 388. The city became the county seat in 1876.
The county includes the Wellington Independent School District, Hedley Independent School District and Samnorwood Independent School District.
Appraisal District Organization and Staffing
The appraisal district was formed in 1981 and became active in 1982. Collingsworth CAD has a total of one full-time staff person, the chief appraiser. The district has money budgeted for a part-time clerical position, but has not hired anyone. The district contracts with Pritchard and Abbott, Inc. (P&A) for professional appraisal services on all property except business personal property.
Exhibit 1 shows the appraisal district's organization.
Appraisal District Organization
Board of Directors David Conner Jacque Garner Kathy Littrell Eddie Orr Michael Souder Staff Ann Wauer, Chief Appraiser Source: Collingsworth CAD, 2005.
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 eight taxing units: Collingsworth County, Wellington Independent School District, Samnorwood Independent School District, Hedley Independent School District, City of Dodson, City of Wellington, Collingsworth County Underground Water Conservation District, and Collingsworth General Hospital District.
Exhibit 2 presents the types of properties appraised by Collingsworth CAD in tax year 2005. P&A handles the appraisal of all categories of property except Category L (Commercial Personal), which is appraised by the in-house staff.
Property by Category Summary
with Assigned Responsibility
Tax Year 2005
Property Category Account Type Description Responsible for Appraisal Category A Residential Contracted Appraisal Firm Category B Multi-Family Contracted Appraisal Firm Category C Vacant Lots Contracted Appraisal Firm Category D/E Farm/Ranch Land w/Impr. Contracted Appraisal Firm Category F1 Commercial Real Contracted Appraisal Firm Category L1 Commercial Personal In-house Appraiser Category G Minerals Contracted Appraisal Firm Category J Utilities Contracted Appraisal Firm Category F2 Industrial Real Contracted Appraisal Firm Category L2 Industrial Personal Contracted Appraisal Firm Source: Collingsworth CAD, 2005.
Most appraisal districts contract out some of its appraisals to contract appraisal firms. Collingsworth is fairly unique in that it contracts almost all of its appraisals to P&A. The chief appraiser appraises only category L1, business personal property. Typically PTD performs the following analysis of comparison between a county appraisal districts and its peers.
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 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 property; L1, 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 Collingsworth State Avg. Group Avg. Parcel Size Group (by number of locally appraised parcels) 5,000 - 9,999 Estimated # Locally Appraised Parcels 127 55,463 7,045 # Taxing Units 8 15 7 Locally Appraised Parcels to Staff 127 3,404 2,446 2003 Composition by Percentage of Value (Self Report): Collingsworth State Avg. Group Avg. Residential Value 17.7% 52.6% 12.5% Non-Residential, Non Mineral 77.6% 43.6% 55.2% Non-Residential, Mineral 4.7% 3.7% 32.2% 2003 Composition by Account Category Type (Operations Survey): Real Property 5,505 45,804 7,151 Mineral Property 4,547 13,536 10,989 Business Personal Property 129 4,689 484 Individual Personal Property 702 1,342 587 Total Accounts 10,883 65,372 19,210 2003 Composition by Locally Appraised Parcel Category (Estimated from Self Report): Collingsworth State Avg. Group Avg. Parcel Type # Parcels % of Parcels L1 127 100.0% 5.7% 3.9% Total 127 100.0% 100.0% 100.0%
PTD estimated that Collingsworth CAD staff is responsible for appraising about 127 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.
The number of parcels per staff member for Collingsworth CAD was 127. The chief appraiser appraises only L1 properties. If the chief appraiser was performing appraisals typical of other CADs, the comparison CADs based on grouping would be Sherman, Garza, Sutton and Martin, who have parcel to staff ratios of 1,052, 1,939, 2,979 and 1,881 respectively. 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 sometimes 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.
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)
Collingsworth State Avg. Group Avg. 2003 Budget $98,230 $1,079,695 $158,351 2003 Surplus $0 $71,620 $10,114 2003 Surplus as % of Budget 0.0% 6.6% 6.4% 2004 Budget $98,850 $1,104,961 $161,854 % Change in Budget 0.6% $0 2.2% 2004 Budget per Total Parcel $17.30 $19.92 $22.97 Staffing Full Time 1 18 3 Part Time 1 2 1 Supervisory 1 3 1 Programmers * 2 1 Supervisory to Staff Ratio 1:1 1:5 1:3 Chief Appraiser Performs Appraisals? No 2004 Total Compensation $21,000 $53,564 $37,098 Appraisers Full - Time 1 8 1 Part - Time * 0 1 Salary Range: Low * $24,504 $23,596 High * $37,521 $26,358 Training Budget $800 $8,832 $3,573 # Registered with BTPE (1) 1 9 3 Types of BTPE Certification: RPA (2) RTA (3) RTC (4) All BTPE Certifications is the district: 0 0 0 1 Exhibit 3
Reported Data On Parcels, Categories Staffing, Training And Operations
Comparison to State and Group Averages (continued)
Collingsworth State Avg. Group Avg. Reappraisal Last Year of Reappraisal 2003 Next Year of Reappraisal 2005 Type of Appraisal: Cyclical Method of Appraisal: Combination Protests 15 3,131 49 Protests per Parcel 0.1% 4.7% 0.3% Consolidated Collection No Collection Budget $0 Geographic Information System (GIS)? Yes Percent GIS Complete 100% 80% 78% Board of Directors Members 6 6 6 Tax Assessor Votes? Yes Elected Members 3 3 3
Note: An asterisk (*) is shown where data was not reported.
Source: Collingsworth 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, Collingsworth 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 question 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.
Collingsworth County answered 109 out of 110 questions.
The IAAO self-assessment questionnaire was provided with the IAAO self assessment guide. In the guide's introduction, it stated:
The guide is designed for use by individuals who want to evaluate their own procedures and who are seeking to either continually improve or to evaluate their procedures against what is believed to be a standard of best practices in assessment administration.
The Comptroller provided the questionnaire and the guide to the district to allow it to perform a self assessment of its operations and help it recognize areas where it is doing a good job and areas where it needs to improve.
Chapter 1: Setting, Legal Framework, Value Standard and Assessment Cycle.
The district's answers in this chapter indicated to the reviewer that the district understands the legal framework, value standard and assessment cycles required of the appraisal district.
Chapter 2: Resources and Management
The district's answers to chapter 2 are brief; however they do indicate that the district is satisfied with the budget process, personnel training, management, organization, and current skill level of the staff.
Chapter 3: Computerization
The answers to Chapter 3 indicate a working knowledge of the computer system used by the district. The answers also indicate that the staff is aware of the requirements of the type and kind of records that the district needs to keep and also the length of time they need to keep them. The answers also reflect the fact that the district has a geographic information system along with document images.
Chapter 4: Mapping
The answers to chapter 4 show that the district has a mapping system with the necessary tools and information to meet the standards of assessment. The answers indicate the district knows how the system works and has integrated it with the computer system in order to have a working system.
Chapter 5: Data Collection
The answers in chapter 5 show that the district knows what data is required by Comptroller rules, state law, and appraisal standards. They stated that they collect and use the data in the assessment process.
Chapter 6: Land Evaluation
The answers in Chapter 6 show that the district understands the adjustment requirements of situs, size, location, shape, density, and adjustments for positive or negative influences. These are all required either by appraisal standards or by state law or Comptroller rule.
Chapter 7: Residential Property Valuation
The answers in chapter 7 show that the districts understands the three approaches to value and the data requirements to achieve an effective appraisal program for residential property. The answers indicate that the district follows the Uniform Standards of Professional Appraisal Practice.
Chapter 8: Commercial Property Valuation
Answers to chapter 8 questions reflect that the district follows the accepted standards and the published requirements of data collection and appraisal reflected in Texas statutes, appraisal standards and Comptroller rules.
Chapter 9: Sales Data, Ratio Studies, and Stratification
The answers to chapter 9 indicate the district follows the accepted procedures for gathering sales data, doing ratio studies and using stratification.
Chapter 10: Personal Property Assessment
The answers in chapter 10 indicate the district follows the accepted procedures for discovery of personal property. However, the district indicated it does not audit returns and inspect businesses to ensure accurate reporting. In addition, the district does not maintain separate cost trend and depreciation indexes for each class of property.
Chapter 11: Assessment Administration
The district indicated that it is following the accepted practices of assessment administration in Comptroller rules and International Association of Assessing Officers standards.
Chapter 12: Defense of Values
Chapter 12 answers on defense of values follow the accepted standards of the Comptroller, and International Association of Assessing Officers Standards.
Chapter 13: Public Relations
The answers in chapter 13 indicate that the district's records can be accessed by the public and that the GIS system facilitates the public access of information. However, the district answered it does not have an active public relations program or program of public appearances.
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 Collingsworth 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.
Collingsworth CAD and Hedley ISD hired Pritchard & Abbott to appeal the findings of the preliminary study. The joint protest requested changes to expenses related to irrigated croplands, fertilizer and fungicide expenses and boll weevil eradication expenses. Staff agreed to changes on two of the three requests, with the request for changes to fertilizer and fungicide expenses being denied for lack of evidence. Hedley ISD was identified as an eligible school district in June 2004.
A review of the school districts in the county indicates that Collingsworth CAD is inconsistently appraising farm and ranch land, as determined by the PTD. 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 land's productivity value and D2 is based on what the land would sell for in an open market transaction.
Hedley ISD is split between Donley County and Collingsworth County. There is one property category tested in Hedley ISD within Collingsworth County. Category D, Rural Real, makes up 86.3 percent of the district's value with a weighted mean ratio of 0.8701. 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. The low ratio in subcategory D1 drops the district outside the margin of error causing the school district to be identified as eligible.
Hedley ISD's Category D tested with a weighted mean ratio of 0.8701 and is the primary reason that the school's values are not within the acceptable range determined by the study. Hedley ISD's subcategory D1 makes up 78.2 percent of category D's value and received a weighted mean ratio of 0.8395. Subcategory D2 makes up 21.8 percent of category D's value and received a weighted mean ratio of 1.0006.
Besides Hedley ISD, the other school districts in the county are Wellington ISD and Samnorwood ISD.
Wellington ISD is within the margin of error with three property categories tested. Category A, Single-Family Residences, makes up 43.6 percent of the district's value with a weighted mean ratio of 0.9503. Category D, Rural Real, makes up 35.6 percent of the district's value with a weighted mean ratio of 0.9935. Wellington ISD's subcategory D1 is 73.6 percent of category D's value and 32 percent of the tested value. D1 received a weighted mean ratio of 0.9929. Subcategory D2 makes up 26.4 percent of category D's value and 11 percent of the school district's total tested value. D2 received a weighted mean ratio of 0.9952. Category F1, Commercial Real, makes up 6 percent of the district's value with a weighted mean ratio of 0.9257.
Samnorwood ISD is also just within the margin of error limits. Category D, Rural Real, makes up 46 percent of the district's value with a weighted mean ratio of 1.0233. Samnorwood ISD's subcategory D1 is 78.4 percent of category D's value and 45 percent of the tested value. D1 received a weighted mean ratio of 1.0309. Subcategory D2 makes up 21.6 percent of category D's value and 12 percent of the school district's total tested value. D2 received a weighted mean ratio of 0.9968. Category G, Minerals, makes up 29.1 percent of the district's value with a weighted mean ratio of 1.1039. Category J, Utilities, makes up 22.6 percent of the district's value with a weighted mean ratio of 0.9755.
In summary, Collingsworth CAD is appraising category D1 at or below market value. In Hedley ISD, category D1 is below market value causing the school district to be identified as eligible. Category D1 in the other two school districts is appraised at market value. Category D1 was the major factor causing the Property Tax Division to assign Hedley ISD a finding of invalid. The appraisal district needs to review its appraisal procedures and methodology in the portion of category D that is qualified for special agricultural use appraisal (D1) to determine why it is inconsistently appraising this property category.
For a statistical explanation of why the district was selected as eligible, see Appendix 18.