Tax Bills are Made up from Many Taxing Jurisdictions

Should I Blame the Central Appraisal District? 

When Texas property tax bills come out in October, your first response may be that they are too high. Property owners want to blame the Central Appraisal District (CAD), the entity that sets their property values. In this case, the CAD is innocent of the blame. While the CAD does set property values, they are not part of setting the tax rates, nor do they determine the ultimate tax bill. In fact, it is usually the Tax Assessor/Collector who issues the property tax bill. 

Who Determines the Property Tax Rates? 

Local jurisdictions such as independent school districts, colleges, hospitals, cities, and the county all need tax revenue to operate. Each year they submit their budgets for review and approval. Based on their budget, and the values of properties in their taxable areas, tax rates are determined so they can collect the amounts needed for their budgets. While the actual process can be more complicated, this can be illustrated quite simply using the following formula:

 If a jurisdiction needs $1,000,000 and your taxable value is $250,000,000, then your tax rate would be $1,000,000 ÷ $250,000,000 = 0.4%. 

Can I Do Anything About the Tax Rates? 

Truth-in-Taxation requires that notices are published regarding public hearings about proposed budgets and tax rates. It is at these meetings that taxpayers can voice their concerns and seek that the proposed budget be denied. In cases where the tax rate increase is excessive, the increase will be placed on the ballot for voters to approve or deny. By exercising your right to vote, you can have an impact on whether certain tax rate increases are approved or denied.