Appraisal Standards Review
Glasscock County Appraisal District Follow-Up Report
August 2007
Introduction
In July 2004, the Comptroller identified Glasscock County Independent School District (ISD) as one of 54 school districts in the state meeting the criteria that initiate an appraisal standards review (ASR) of its county appraisal district (CAD). In September 2005, the Comptroller’s Property Tax Division (PTD) released the results of its ASR.
The report made eight recommendations to improve Glasscock CAD’s appraisal practices and operations. ASRs are intended to determine why the local value is invalid and to recommend changes in operations and management to improve appraisal practices. The Glasscock CAD review evaluated five functional areas: board of directors; appraisal district policies, procedures and operations; information processing systems; staffing, personnel qualifications and positions; and generally accepted appraisal practices, equality and uniformity of appraisal standards.
At the time of the review, Glasscock CAD faced a number of challenges in managing its operations; documenting its 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 must notify the judge of each district court in the county for which the appraisal district is established. The judge(s) must appoint a five-member board of conservators to implement the recommendations. The board of conservators exercises supervision and control over the appraisal district’s operations until the Comptroller determines, that each school district for which the appraisal district appraises property is 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 complies with the statute if it takes remedial action to implement the recommendations in the ASR. Remedial action means that the CAD has corrected or intends to correct, remedy or improve the deficiencies identified in the ASR. Remedial action generally is demonstrated by having implemented or nearly completed most of the recommendations by the first-year anniversary of the release of the report. 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. As long as the CAD is working to implement the recommended actions, the Comptroller continues to work with the CAD to achieve full compliance. CADs that have completed all recommendations by the one-year anniversary will not require additional monitoring.
In October 2006, PTD reviewed the progress Glasscock CAD had made in implementing the ASR recommendations. Glasscock CAD had implemented five of the eight recommendations, began implementing another and has not implemented two recommendations. The CAD experienced a delay in beginning implementation of the ASR recommendations because the chief appraiser was hospitalized from January through July 2006. Also, a long-term employee retired in May 2006. The CAD has since filled this vacancy.
PTD mailed Glasscock CAD’s board members surveys soliciting their views and comments on the ASR. None of the board members responded.
While the CAD has much work to do to meet the ASR’s recommendations, PTD believes that it is working to comply with the state’s legal requirements
History and Significant Events
Glasscock CAD received an ASR because the 2003 Property Value Study (PVS) found that property values in Glasscock County ISD, the county’s only school district, were invalid, and the school district was eligible for the grace period provided in Texas Government Code Section 403.3011. Rural land and improvements values were the primary reason that the school district’s values were not within the study’s acceptable range. Properties with productivity value had a weighted mean ratio of 0.5449 and non-qualifying acres and farm and ranch improvements had a weighted mean ratio of 0.6802.
The 2004 PVS, published in July 2005, showed the school district’s mean ratio for properties with productivity value had improved to 0.9329 and farm ranch improvements to 0.7294. The 2004 and 2005 Final PVS found that the school district achieved a valid value, and local value was certified. The same was true of the final 2006 PVS.
Since the ASR site visit, the CAD has obtained a computer terminal that interfaces with its appraisal firm’s computers. The chief appraiser indicated that the CAD is now able to access appraisal information and to locally perform tasks such as roll maintenance and name changes.
What Remains to Be Done
The Appendix at the end of this report lists the eight recommendations identified in the original report, with a summary of actions to date. The CAD satisfied five recommendations, has not implemented two others and is in progress on another. Completing the recommendations will document appraisal procedures for staff to follow, help ensure that the CAD properly manages its operations and provide a means for the CAD to reappraise properties regularly.
Recommendation 4: Develop and adopt a written policy and procedures manual for district operations.
The CAD is developing written policy and procedures manuals. It has contacted surrounding CADs to obtain copies of their documents and plans to adapt them to meet its needs. A policy and a procedures manual will help staff understand the steps necessary to accomplish the CAD’s tasks. Glasscock CAD should submit completed manuals to the Comptroller no later than Sept. 30, 2007.
Recommendation 7: Prepare detailed appraisal procedures manuals that provide local procedures and practices for each type of property appraised and tie these local procedures to the existing Marshall & Swift/Boeck procedures.
The CAD has not yet begun implementation of this recommendation, but expects to have it substantially complete by Nov. 1, 2007. The chief appraiser indicated that the CAD has discussed this recommendation with the appraisal firm that will develop the manuals. Comprehensive appraisal procedures will help the CAD apply generally accepted appraisal methods and techniques to its appraisals.
To comply with this recommendation, the CAD should submit to the Comptroller a completed appraisal manual no later than Dec. 31, 2007.
Recommendation 8: Establish written procedures for gathering and analyzing sales.
The CAD has not begun implementation of this recommendation, but the chief appraiser anticipates that it will be substantially complete by Nov. 1, 2007.
While the chief appraiser pointed out that very little sales information is available, the CAD will attempt to gather any obtainable sales information. They have discussed this recommendation with the appraisal firm that will assist in developing procedures for gathering and analyzing sales for the district. Written procedures can assist the CAD in performing market analyses consistently, regardless of changes in personnel.
To comply with this recommendation, the CAD must submit a completed appraisal manual to the Comptroller’s office no later than Dec. 31, 2007.
Appendix
Glasscock County Appraisal District Appraisal Standards Review Implementation Status
2.1 Board of Directors
| Rec. # | Recommendation | Implementation Status | If Not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 1 | Establish a committee to examine all of the pros and cons of consolidating Glasscock CAD with one of the surrounding CADs and put the final decision to a vote of the board. |
Complete |
While the board did not see a need for a committee to review this recommendation, it put the matter to a final vote. The board voted unanimously not to consolidate with another CAD, expressing the belief that it would not be in the taxpayers’ best interest. Glasscock CAD has achieved local value in the last three PVS reports. Oil, gas and other minerals and utilities contribute more than 90 percent of the CAD’s value. The CAD contracts with an appraisal firm to appraise these properties and does not believe there is a need for consolidation. This was an optional recommendation offered by the Comptroller as a possible means of improving the CAD’s management function. The Comptroller’s office is satisfied that the CAD considered the recommendation and chose instead an option it finds more suitable for the taxpayers of Glasscock County. |
|
| 2 |
Develop a job description and an objective set of evaluation measures for the chief appraiser position, establish an annual evaluation process based on objective measures and include it in the chief appraiser’s contract. |
Complete |
The CAD contacted Reagan and Howard CADs to discuss their processes and used their input to develop a job description and evaluation instrument for the chief appraiser. The job description provides for essential functions performed; specific tasks; and the required knowledge and skills and qualifications, such as certification by the Board of Professional Tax Examiners. The evaluation instrument rates the chief appraiser on a range from 1 to 10, with 1 being inadequate and 10 excellent. The board rates the chief appraiser in 11 areas, including Goals and Objectives, Organization, Problem Solving, Leadership, Relationship with Board, Duties/Responsibilities, Business and Finance of Appraisal District, Communication, Relationship with Community and Development. On March 27, 2007, the board of directors approved the chief appraiser’s job description and evaluation instrument. |
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| 3 |
Revise the professional appraisal services contract to include dates when the appraisal firm will perform its services and deliver its appraisals to the district: include a list of all properties that the appraisal firm is responsible for appraising; ensure that a board member signs any future contract, according to board policy; and include contract monitoring in the process. |
Complete |
The CAD renewed its contract with its appraisal firm on Dec. 29, 2006. The board chair, secretary and the chief appraiser signed the contract on the CAD’s behalf. The company will appraise oil and gas leases; industrial complexes; telephone and electric utility systems; electric generating plants; pipeline systems; railroad companies and industrial and oil field supply and service facilities located in the CAD. The company will complete all appraisals by no later than May 15. The CAD will monitor the company’s progress and compliance by requiring progress reports to be submitted to the CAD on Feb. 15 and April 15. |
2.2 Appraisal District Policies, Procedures and Operations
| Rec. # | Recommendation | Implementation Status | If Not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 4 |
Develop and adopt a written policy and procedures manual for district operations. |
In Progress | Sept. 30 2007 |
The CAD contacted Reagan and Howard CADs to discuss their processes and will use them as a guideline to develop written policies and procedures for its operations. Glasscock CAD must submit completed manuals to the Comptroller no later than Sept. 30, 2007, to ensure compliance. |
2.3 Staffing, Personnel Qualifications and Positions
| Rec. # | Recommendation | Implementation Status | If Not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 5 |
Hire a full time chief appraiser who has appraisal experience and staff the appraisal district accordingly |
Complete |
As with Recommendation 1, the board deliberated this issue and voted unanimously not to hire a full-time chief appraiser. Oil, gas and other minerals and utilities contribute more than 90 percent of the CAD’s value, and the CAD contracts with an appraisal firm to perform appraisals for these properties. The need for a full-time chief appraiser may not be necessary. Glasscock CAD has achieved local value in the last three PVS reports due largely to the work done by the contracted appraisal firm. This was an optional recommendation, and the Comptroller is satisfied that the CAD considered the recommendation and instead chose an option it finds more suitable for the taxpayers of Glasscock County. |
2.4 Generally Accepted Appraisal Practices; Equality and Uniformity of Appraisal Standards
| Rec. # | Recommendation | Implementation Status | If Not Complete, Projected Completion Date | Description of Actions Taken to Date |
|---|---|---|---|---|
| 6 |
Adopt a detailed reappraisal plan that, at a minimum, includes the 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 board of directors adopted a 2007-08 reappraisal plan at its Sept. 12, 2006 meeting. The CAD adapted the plan from a template used by a number of other CADs in Texas. The plan calls for the annual reappraisal of all property beginning in September and finishing in May of each following year. It outlines the various steps the CAD will take in accomplishing the reappraisal but lacks specificity regarding when these steps will occur. The plan delineates who is responsible for its various components. While the plan is rudimentary, it is sufficient to meet the needs of Glasscock CAD, since it appraises less than 10 percent of its property value in house. The Comptroller urges the CAD to continue to improve the plan with a more detailed calendar. |
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| 7 |
Prepare detailed appraisal procedures manuals that provide local procedures and practices for each type of property appraised and tie these local procedures to the existing Marshall & Swift/Boeck procedures. |
Not implemented | Dec. 31, 2007 |
The chief appraiser has discussed this recommendation with the appraisal firm that provides services for the CAD. The firm will work with the CAD to develop local appraisal procedures manuals. To comply with the recommendation, the CAD must submit to the Comptroller a completed appraisal manual no later than Dec. 31, 2007. |
| 8 |
Establish written procedures for gathering and analyzing sales. |
Not implemented | Dec. 31, 2007 |
The chief appraiser pointed out that little sales information is available but said the district will attempt to gather any it can obtain. The CAD will work with its appraisal firm to develop written procedures for gathering and analyzing sales. To comply with the recommendation, the CAD must submit to the Comptroller a completed appraisal manual no later than Dec. 31, 2007. |
2.5 Generally Accepted Appraisal Practices; Equality and Uniformity of Appraisal Standards
The report had no findings or recommendations in this section.