Update: Commercial Property Tax
Appraisal Lawsuits Appealed in August 2022
By Lee D. Winston | September 18, 2022
For the month of August, there were two commercial property tax appraisal lawsuits appealed from district court, one of which was appealed by Michel Gray & Rogers LLP. There were two other commercial property tax lawsuits appealed but those do not deal with core property tax appraisal issues such as qualifications for exemptions or application of appraisal methodologies.
NSC Electronics Inc (SigmaTron International Inc) v. Val Verde County Appraisal District, No. 04-22-00480-CV (Tex. App.—San Antonio)
Missing Signature: Interpreting What is a Completed Exemption Application
The SigmaTron appeal was filed by Lee D. Winston of Michel Gray & Rogers LLP. The appeal is from a plea to the jurisdiction judgment in favor of the Val Verde County Appraisal District and concerns the correct interpretation of the term “completed exemption application” in the exemption application statute (Texas Property Tax Code Section 11.43).
In trial court the district argued that the SigmaTron failed to timely file a completed freeport exemption application and as a result did not exhaust its administrative remedies. Why? Because the application was not signed.
SigmaTron through its counsel argued (among other things) that the district’s interpretation of “completed” is hyper technical and ignores statutory construction and interpretation. If the legislature intended freeport exemption applicants to sign a particular application for exemption it would have said so, just as it has throughout other parts of the Texas Property Tax Code. The district avoided addressing this. Instead, they took a more relaxed argument — SigmaTron voluntarily chose to use the Texas Comptroller of Public Accounts 50-113 model form and did not complete every box, so the application is not complete. The judge accepted this argument, which will likely lead to absurd results. For instance, the same form includes a box for the mailing address of the applicant. What if that was not provided?
The trial court in this case was the 63rd Judicial District Court. Michel Gray & Rogers LLP appealed the judgment on July 11, 2022, and the appellate case began on August 2, 2022 in the 4th Court of Appeals, San Antonio.
Importance to you: This case is extremely important for property tax consultants and their clients who file exemption applications in the State of Texas.
To follow this appeal, click the following link (or copy and paste): https://search.txcourts.gov/Case.aspx?cn=04-22-00480-CV&coa=coa04.
Rocksprings Val Verde Wind, LLC v. Jackie Casanova, RPA, CCA, in her capacity as the Chief Appraiser of the Val Verde County Appraisal District, 04-22-00524-CV (Tex. App.—San Antonio)
wind farm production tax credits and power purchase agreements: interpreting what is taxable
The Rocksprings appeal is from a final judgment increasing the Rocksprings Wind Farm from $101,400,000 to $197,417,993 following a jury trial overseen by the 63rd Judicial District Court. The appeal concerns, among other issues, whether federal production tax credits and above-market power purchase agreement contracts are intangible personal property not taxable in Texas.
In trial court Rocksprings filed a motion to exclude the chief appraiser’s experts for being unqualified and that their income approach to valuation violates Texas law in that it includes non-taxable intangible personal property — federal production tax credits and above-market power purchase agreement contracts. The 63rd Judicial District Court denied Rocksprings motion and the case proceeded to trial where the jury adopted in its verdict the exact value concluded by the chief appraiser’s expert’s income approach valuation based on a discounted cash flow model.
The taxpayer appealed on August 12, 2022, and the appellate case began on August 16, 2022, in 4th Court of Appeals, San Antonio.
Importance to you: This case is important for property tax consultants and their clients who need clarification on the scope of “intangibles” for properties with construction and operation dependent on certain incentives.
To follow this appeal, click the following link (or copy and paste): https://search.txcourts.gov/Case.aspx?cn=04-22-00524-CV&coa=coa04.
Harris County Appraisal District v. Mueschke Road Houston ASLI IX LLC, 14-22-00604-CV (Tex. App.—Houston [14th Dist.]) (This appeal concerns the timely payment of taxes under Texas Property Tax Code Section 42.08. The district’s plea to the jurisdiction to dismiss the taxpayer’s case for failure to timely pay taxes was denied. The district appealed on August 18, 2022, and the appellate case began on August 19, 2022, in 14th Court of Appeals, Houston.); Harris County Appraisal District v. Sealy IDV Thompson 10 LLC, 01-22-00584-CV [Tex. App.—Houston [1st Dist.]) (This appeal concerns timely service of a lawsuit. The district’s motion for summary judgment asserting that the taxpayer’s claims are barred because it waited 11 months to serve the lawsuit on the district was granted. The taxpayer appealed on August 10, 2022, and the appellate case began on the same day, in 1st Court of Appeals, Houston.).
 To review the text of Texas Property Tax Code Section 11.43, click the following link (or copy and paste): https://codes.findlaw.com/tx/tax-code/tax-sect-11-43.html.