Chapter 1
Findings of the Property Value Study and Summary
Overview of Property Value Study
The annual PVS estimates the total taxable property value in each school district in Goliad CAD. With a few notable exceptions, the law requires all CADs and PTD to appraise property at market value. Market value, in essence, is the price a willing buyer would pay a willing seller for the property under normal conditions. Agricultural land and timberland, however, are appraised according to the productivity value of the land's category.
The CAD determines the local appraisal roll value and certifies it to each school district; these values become the districts' tax roll values. Each school district must submit an annual self-report of its property values to PTD, which audits the reports for accuracy.
PTD's estimate of the total taxable value in a school district, called the state value, is made by estimating market value or by accepting the local appraised value in each property category and then adding these category values for an overall school district value. PTD then deducts the school district's self-reported, state-mandated homestead exemptions, disabled veterans exemptions, value limitations, reinvestment zones, freeport exemptions, the loss between market value and productivity value of qualified agricultural lands, the school tax ceiling for homeowners over age 65 or with a disability and other state-mandated exemptions.
PTD issues a preliminary and a final PVS each year. School districts and CADs may protest the findings of the preliminary PVS through an administrative hearings process. This process requires the protester to file a written protest with supporting documentation within 40 days of the issuance of the preliminary PVS. PTD may amend the findings of the preliminary PVS based on the submission of a written protest, a conference between PTD and CAD representatives or a formal hearing. A hearings examiner appointed by the Comptroller's general counsel holds the formal hearing; this person is not a PTD employee. A school district that disagrees with the hearing examiner's final decision may appeal it to Travis County district court.
When conducting the property value study, PTD assigns properties to various categories, such as residential, commercial and rural property, so like properties can be studied together.
In general, a ratio indicates the percentage of market value, as determined by PTD, at which a CAD appraises a property or group of properties. A ratio of 1.0 indicates appraisal at market value– the legal standard. Generally, appraisals with ratios that are close to the standard, for instance between 0.95 and 1.05, are considered reasonably accurate for a property group.
Eligible School Districts
The 2006 PVS identified Goliad ISD as an eligible district when its local value fell outside of the confidence interval limit. The PVS tested four property categories in Goliad ISD: Category A: Real Property: Single-Family Residential; Category D: Rural Real; Category G: Oil, Gas and Other Minerals; and Category J: Real and Personal Property: Utilities.
Category A: Real Property: Single-Family Residential made up 12 percent of the total test value and 7 percent of the school district's value. A review of the Category A: Real Property: Single-Family Residential sample ratios in the 2006 PVS indicates that the CAD appraised from as low as 79 percent to a high of 124 percent of market value, with a weighted mean ratio of 0.9661.
Category D: Rural Real made up 23 percent of the total test value and 12 percent of the school district's value. Category D: Rural Real includes two subcategories: D1: Real Property: Qualified Agricultural Land, which is primarily farm and ranch land that qualifies for the special productivity appraisal; and D2: Real Property: Non-Qualified Land, which are primarily rural homes and land that does not qualify as farm, ranch or timberland. The differences in value between D1: Real Property: Qualified Agricultural Land and D2: Real Property: Non-Qualified Land are wide since qualified land is appraised using a special statutory method to determine the land's productivity value, and non-qualified property is based on what the land would sell for in an open-market transaction.
D1: Real Property: Qualified Agricultural Land made up 6 percent of the total test value and 3 percent of the school district's value. The weighted mean ratio of the D1: Real Property: Qualified Agricultural Land tested was 1.0809. D2: Real Property: Non-Qualified Land made up 17 percent of school district's test value and 9 percent of the school district's value. The CAD appraised D2: Real Property: Non-Qualified Land from as low as 79 percent to a high of 135 percent of market value, with a weighted mean ratio of 0.9505.
Category G: Oil, Gas and Other Minerals made up 59 percent of the total test value and 40 percent of the school district's value. A review of Category G: Oil, Gas and Other Minerals sample ratios in the 2006 PVS indicates that the CAD appraised from as low as 72 percent to a high of 146 percent of market value, with a weighted mean ratio of 0.9341.
Category J: Real and Personal Property: Utilities made up 7 percent of the total test value and 6 percent of the school district's value. A review of the Category J: Real and Personal Property: Utilities sample ratios in the 2006 PVS indicates that the weighted mean ratio was 0.9857.
While these figures show the range of property ratios in Goliad CAD, a clearer measure of appraisal performance includes how many of these ratios were within 10 and 25 percent of the median ratio. The median ratio is the ratio in the middle of all the other ratios when sorted by size.
These figures, in conjunction with the coefficient of dispersion (COD) outlined below, measure the consistency of an appraisal district's property appraisals at the same percentage of market value, without regard to value. A low COD combined with high percentages indicates equitable appraisals; while a high COD paired with low percentages indicates inequitable appraisals.
The median ratio for Category A: Real Property: Single-Family Residential in Goliad ISD was 97 percent, with 61 percent of the ratios within 10 percent of the median and 96 percent within 25 percent of the median.
The median ratio for D2: Real Property: Non-Qualified Land in Goliad ISD was 94 percent, with 62 percent of the ratios within 10 percent of the median and 90 percent within 25 percent of the median.
The median ratio for Category G: Oil, Gas and Other Minerals in Goliad ISD was 95 percent, with 55 percent of the ratios within 10 percent of the median and 97 percent within 25 percent of the median.
The median ratio for Category J: Real and Personal Property: Utilities in Goliad ISD was 100 percent, with 89 percent of the ratios within 10 percent of the median and 89 percent within 25 percent of the median.
Goliad CAD Summary
The Goliad CAD's overall median ratio was 0.97. Category A: Real Property: Single-Family Residential sample ratios ranged from 0.79 to 1.24. The median ratio was 0. 97. D2: Real Property: Non-Qualified Land sample ratios ranged from 0.79 to 1.35, with a median ratio of 0.94. Sample ratios for Category G: Oil, Gas and Other Minerals ranged from 0.72 to 1.46. The median ratio was 0.95. The median ratio for Category J: Real and Personal Property: Utilities was 1.
Coefficient of Dispersion
The COD, the primary measure of appraisal uniformity, measures the average percentage by which individual ratios vary from the median ratio. According to IAAO's Property Appraisal and Assessment Administration, a low COD indicates that appraisals within a category of property are uniform, while a high COD indicates property is being appraised at inconsistent percentages of market value. A COD that is very low, however, may indicate "sales chasing," a form of unequal appraisal.
According to IAAO's Standard on Ratio Studies, CODs for single-family residences, should generally be 15 or less, and 10 or less for new and homogeneous areas. For vacant lots, and for income-producing property, the COD should be 20 or less. For other real property and personal property, CODs should reflect the nature of the property, market conditions and the availability of reliable market indicators.
The 2006 CODs for Goliad CAD property was:
- 9.79 for Category A: Real Property: Single-Family Residential;
- 10.44 for Category D: Rural Real;
- 11.19 for Category G: Oil, Gas and Other Minerals; and
- 2.25 for Category J: Real and Personal Property: Utilities.
In Goliad ISD, the 2006 CODs were:
- 9.85 for Category A: Real Property: Single-Family Residential;
- 10.49 for Category D: Rural Real;
- 11.17 for Category G: Oil, Gas and Other Minerals; and
- 2.35 for Category J: Real and Personal Property: Utilities.
These numbers indicate relative uniformity in appraisal in these categories in the CAD and ISD.