090718 Friday Staff Report 4(OF City Manager's Office
DENTON 215 E. McKinney St., Denton, TX 76201 • (940) 349-8307
MEMORANDUM
DATE: September 7, 2018
TO: The Honorable Mayor Watts and Council Members
FROM: Todd Hileman, City Manager
SUBJECT: Friday Staff Report
I. Council Schedule
A. Meetings
1. Public Utilities Board Meeting on Monday, September 10, 2018 at 9:00 a.m. in
the City Council Work Session Room.
2. Historic Landmark Commission Meeting on Monday, September 10, 2018 at
5:30 p.m. in the City Council Work Session Room.
3. Mobility Committee Meeting on Tuesday, September 11,2018 at 11:30 a.m. in
the City Council Work Session Room.
4. Work Session of the City Council on Tuesday,September 11,2018 at 2:00 p.m.
in the City Council Work Session Room followed by a Regular Meeting at 6:30
p.m. in the Council Chambers.
5. Economic Development Partnership Board on Wednesday, September 12, 2018
at 11:00 a.m. in the City Council Work Session Room.
6. Agenda Committee Meeting on Wednesday, September 12, 2018 at 2:30 p.m.
in the City Manager's Conference Room.
7. Work Session of the Planning and Zoning Commission on Wednesday,
September 12, 2018 at 5:00 p.m. in the City Council Work Session Room,
followed by a Regular Meeting at 6:30 p.m. in the City Council Chambers.
8. Development Code Review Committee Meeting on Friday,September 14,2018
at 11:00 a.m. in the City Council Work Session Room.
OUR CORE VALUES
Integrity • Fiscal Responsibility • Transparency • Outstanding Customer Service
B. Upcoming Events
1. TML Annual Conference, October 10-12, 2018 at the Fort Worth Convention
Center.
2. NLC City Summit,November 7-10, 2018 in Los Angeles, CA.
H. General Information & Status Update
A. New Police Chief Selected — Frank Dixon, who currently serves as an Assistant
Chief of Police with the Austin Police Department,has been announced as the City
of Denton's next Chief of Police. Dixon brings more than 23 years of public
service and leadership experience to the postion. Dixon will begin his new role
with the City of Denton on October 15.Additional details regarding Chief Dixon's
experience and the Police Chief selection process can be found in the attached
press release. Staff contact: Todd Hileman, City Manager
B. Shelter Planning ork_rg_oup — The Shelter Planning workgroup held its first
meeting on Tuesday, September 4. The group discussed goals and purpose,
reviewed and outlined the current shelter environment (including days/hours,
operating capacity, inclement weather capacity, length of stay, individuals served,
any requirements, etc.), began discussion of future plans of the agencies, and
discussed developing a survey for individuals experiencing homelessness, both
sheltered and unsheltered. The next meeting is scheduled for October 3. Staff will
continue to provide updates as work progresses. Work groups of the Denton
County Homeless Leadership Team (DCHLT) also provide regular reports to the
DCHLT board—those reports will be shared and are also posted on the DCHLT's
website. Staff contact: Sarah Kuechler and Dani Shaw, Public Affairs
C. DHA's Mainstream Voucher Program— Staff was recently notified that the U.S.
Department of Housing and Urban Development(HUD)awarded$98.5 million to
285 local public housing authorities across the country to provide permanent
affordable housing to nearly 12,000 additional non-elderly persons with
disabilities. The housing assistance is provided through HUD's Section 811
Mainstream Housing Choice Voucher Program which provides funding for
housing agencies to assist non-elderly persons with disabilities who are
transitioning out of institutional settings, at serious risk of institutionalization,
homeless, or at risk of becoming homeless. City staff provided a letter of support
for the Denton Housing Authority's participation in the program. DHA will
receive 40 vouchers to provide permanent housing for low income non-elderly
persons with disabilities. DHA staff will contact personnel from various agencies
to schedule a meeting to discuss program requirements, the application process,
and general administration of the program. Staff contact: Sarah Kuechler, Public
Affairs
D. Division of Chamber Economic Development Funding Between Utility and
General Funds — During the August 28 work session presentation on the annual
economic development agreement between the City of Denton and the Denton
Chamber of Commerce, the City Council asked why a portion of the funding
comes from the Utility Fund. The City of Denton has funded economic
development activities provided by the Denton Chamber of Commerce for 32
years through a combination of Utility Fund and General Fund revenues. Staff
research shows that FY 1986-87 was the first year such funding was provided,
specifically$11,428 from the Utility Fund. For the next nine fiscal years, all of the
funding provided to the Chamber came from the Utility Fund. In FY 1996-97,
funding began to come from both the Utility and General Funds, and that has
continued through the current fiscal year. Staff was unable to locate documented
information about the original reasoning behind using Utility Funds for this
purpose,but it is reasonable to assume that the thought was the Chamber's efforts
to recruit new businesses to Denton would result in an increased customer and rate
base for Denton's municipal utilities. Staff contact: Caroline Booth, Economic
Development
E. Parks and Recreation Green Ribbon Grant—In June of 2018,Parks and Recreation
submitted a Green Ribbon grant application to the Texas Department of
Transportation (TxDOT). On August 9, staff received notification that TxDOT
approved the City of Denton's application for landscaping improvements along
US380 in Fiscal Year 2019 fiscal, totaling $667,285. This grant funded project
will enhance the median on US380 from Masch Branch Road to Elm Street
(US77). The image below highlights the site of the proposed project.
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The TxDOT Green Ribbon Program was established to improve the visual
character of highway corridors and minimize the negative impacts of air pollution
through planting of trees and shrubs. Final construction drawings are due to
TxDOT in December 2018. It is anticipated that this project will begin
construction in calendar year 2019. Staff contact: Gary Packan, Parks and
Recreation
F. Trail Loop Completed at Sequoia Park - Parks and Recreation has recently
completed a loop trail in Sequoia Park. This park is located on Nolen Circle just
off of University Drive. The park itself is a total of 5.5 acres, and the trail now
totals .41 miles. A total of.25 miles or 1,300 ft. was added to the existing trail to
complete the loop. This project brings the City's hard surface trail total to 31.3
miles. Trail development was the highest ranked desired amenity in the 2009 Parks
Master Plan.
This project cost $85,471 to complete, and was funded using the Park
Improvement Fund (915/916). Additional trees will be planted along the trail to
provide future shade for residents to enjoy during warmer weather. Below is an
image of the newly completed trail segment. Staff contact: Drew Huffman, Parks
and Recreation
f
G. DTV Receives National Excellence in Programming Award — The National
Association of Telecommunications Officers and Advisors honored the winners
of the 33rd Annual Government Programming Awards last week in Philadelphia,
PA. The City of Denton and DTV won the highest honor - first place in the
"Excellence in Programming" category. The awards program recognizes
excellence in broadcast, cable, multimedia and electronic programming produced
by local government agencies. Among the awards with special significance are
the "Excellence in Programming" awards which are judged on the municipality's
variety of programming quality throughout the year. Below is a link to DTV's
award winning entry. Staff contact: Billy Matthews, DTV
City of Denton Television(DTV)
H. Loop 288/Lillian Miller Intersection Closure — TxDOT notified City of Denton
staff this week that OHL, contractor for the Interstate 35/Loop 288 and Brinker
Project, has targeted the weekend of September 21-24 for closure of the Loop
288/Lillian Miller and I-35 intersection. The proposed closure is necessary for the
placement of 21 bridge beams for the new northbound main lane bridge on I-35.
Closure of the intersection will begin 10 pm Friday, September 21 and will reopen
no later than 6:00 am Monday, September 24. OHL will place electronic message
boards the week of September 10 to notify motorists. TxDOT will provide an
official press release and a detour map. The City of Denton Public Affairs
Department will coordinate with the TxDOT Public Information Office to assist
with the public information campaign. Staff contact:Mark Nelson,Transportation
I. Denton Energy Center August Emissions Data - During the August 21 City
Council Meeting, a request was made to include carbon dioxide equivalent(CO2e)
emissions with future Denton Energy Center(DEC)monthly emission reports.The
table below shows DEC emissions for August 2018. Per City Council's request,
this report also includes CO2e estimates. While CO2e reporting is not required by
TCEQ,there is an annual(calendar year)EPA requirement to submit a greenhouse
gas (GHG) emissions report. In preparation for this annual reporting requirement,
a methodology was developed to calculate/estimate monthly CO2e emissions.
Using this methodology, staff will now include CO2e in future DEC monthly
emissions reports. The August 2018 CO2e emissions estimate at the DEC is 12,169
tons. For continuity, staff also calculated July CO2e emissions estimates. The July
2018 DEC CO2e estimate is 12,609 tons. Staff contact: George Morrow, DME
August 2018 Emissions Total Runtime(hrs) Hot Starts Warm Starts Cold Start Stops
GENSET 1-12 TOTALS 1541.3 43.00 32.00 244.00 319.00 NOx CO VOC PMIO PM2.5 S02 NH3
IL pounds pounds pounds pounds pounds pounds pounds
Engine 1 147.5 7 2 1 25 34.00 426.6 471.9 311.1 349.6 349.6 3.1 8.0
Engine 2 149.3 3 1 1 24 28.00 401.4 446.2 280.7 341.9 341.9 2.8 9.7
_ Engine 3 149.4 4 4 21 29.00 385.5 434.3 303.3 379.8 379.8 3.0 5.8
Engine 4 137.8 4 6 16 26.00 326.6 368.4 276.8 352.9 352.9 2.7 5.5
_ Engine 5 137.1 4 0 22 26.00 368.9 422.4 277.4 351.5 351.5 2.7 5.4
Engine 6 35.0 7 5 12 24.00 164.9 170.4 112.1 74.7 74.7 1.1 1.0
Engine 7 60.7 6 1 12 19.00 205.1 227.3 159.3 162.4 162.4 1.5 2.3
Engine 8 144.5 2 0 25 27.00 341.5 460.8 288.6 364.4 364.4 2.8 5.6
Engine 9 143.5 3 5 20 28.00 373.3 416.6 291.6 363.6 363.6 2.8 5.6
Engine 10 146.6 1 3 21 25.00 371.4 418.0 277.2 360.4 360.4 2.7 5.6
Engine 11 146.3 1 2 22 25.00 377.6 425.5 275.71 356.7 356.7 2.7 5.6
Engine 12 143.7 1 3 24 28.00 410.6 455.6 292.8 363.7 363.7 2.8 5.6
Engine Emissions(pounds) 4153.3 4717.4 3146.6 3821.6 3821.6 30.8 65.7
Engine Emissions(tons) 2.0767 2.3587 1.5733 1.9108 1.9108 0.0154 0.0328
BOP Emissions Monthly 0.273F 0.213' 0.026, 0.0�1.910.03
� 0.000
DEC Monthly Emissions Total(tons 2.35 2.57' 1.60 1. 0.03
DEC Annual Permit Limit(tons)g12168.5
95.5 48.6 70 70 1.75 60.9
Monthly Plant Emissions per DEC Annual Permit Limit2.692% 3.290% 2.733% 2.733% 1.593% 0.054%
Monthly Estimated CO2e Emissions(tons)
J. Gas Line at Martin Luther King, Jr. Recreation Center- Earlier this week, a gas
leak was detected at the Martin Luther King, Jr. Recreation Center. The leak is
located between the meter and the building. Gas has been shut off at the recreation
center until repairs are made. Repairs are expected to be completed early next
week. The center remains open, the only service delivery impact is hot water will
not be available until gas is turned back on at the facility. Staff will provide updates
once the gas line has been repaired and hot water has been restored for recreation
center patrons. Staff contact: Gary Packan, Parks and Recreation
K. Eagle Drive Drainage Project—Over the past week,the City has received feedback
regarding the Eagle Drive drainage project and related construction. Prior to the
start of the project,Capital Projects and Public Affairs developed a communication
plan to engage and inform the residents, businesses, and property owners in the
project area. In early August, staff met with many of the business and property
owners to discuss project impacts and provided them with a one-page project
information sheet that included project scope, budget, and contacts. A digital
version of the information sheet was provided to property owners so they could
also send it to their tenants. Later in August, staff also sent a follow-up email to
apartment management informing them that contractors would begin work on
Sept. 4, which would necessitate the closure of a parking area.
Staff understands the frustration of business owners and tenants who are impacted
by this project, and is working diligently to keep them updated on project status.
Staff notified business owners and apartment management that they have received
complaints and re-sent the one-page project information sheet to share with tenants
and other key stakeholders.
Within the next week, a temporary parking lot will open at the corner of Maple
and Myrtle Street to allow customers to park closer to area businesses. The
estimated timeline to install the sanitary sewer and drainage structure across the
apartment parking lot and reestablish pavement is four months. Staff will continue
to provide status updates as the project progresses. Staff contact: Todd Estes,
Capital Projects
III. Community Events
A. City Hall West Steering Committee Public Meeting—A public meeting has been
scheduled for Monday, Sept. 10 from 5:30 to 7:30p.m. at the Patterson-Appleton
Arts Center for the community to provide input on the conceptual design and
potential renovation options for City Hall West. Additional information can be
found in the attached press release, which was distributed on Sept. 6. Staff
contact: Mark Nelson, Transportation
B. Denton Blues Festival — The 20th Annual Denton Blues Festival is scheduled for
Sept. 14-16 in Quakertown Park. This event is free to the public and will feature
several live performances including Big Bill Morganfield,Muddy Waters Review,
Carolyn Wonderland, Selwyn Birchwood, and Zac Harmon. Additional event
details can be found in the attached flyer. Staff contact: Jessica Rogers, Public
Affairs
IV. Attachments
A. Police Chief Selection Press Release
B. City Hall West Steering Committee Press Release
C. Denton Blues Festival Flyer
D. DCTA Leadership Changes Press Release
V. Informal Staff Reports
A. 2018-115 Capital Project Consultants
B. 2018-116 Operating Funds Consultants
C. 2018-117 Playground Replacement Plan
D. 2018-118 Information Security Strategy
E. 2018-119 DCAD Reappraisal Plan Notice
F. 2018-120 Keep Denton Beautiful Information
G. 2018-121 Top 20 Taxpayer Category on EDP Board
H. 2018-122 DME Rate Sensitivity Analysis
I. 2018-123 Council TOMA Training
VI. Council Information
A. Council Requests for Information
B. Draft Agenda for September 18
C. Council Calendar
D. Street Construction Report
-40
o FOR IMMEDIATE RELEASE
DENTON Jessica Rogers • (940) 349-7531 • Jessica.Rogers@cityofdenton.com
City of Denton Appoints New Police Chief
DENTON, TX, Sept. 7, 2018—City Manager Todd Hileman has announced the appointment of
Frank Dixon to the position of Police Chief. Dixon brings more than 23 years of public service
and leadership experience to the position. Dixon will begin as Police Chief on Oct. 15.
"Chief Dixon has proven to be an innovative and experienced leader throughout his career," said
City Manager Todd Hileman. "Frank has demonstrated a commitment to community policing
and engagement strategies. And, his experience in many aspects of law enforcement has
prepared him well to move the Denton Police Department forward."
Chief Dixon currently serves as an Assistant Chief with the Austin Police Department. He
currently leads APD's South Patrol Bureau, Austin-Bergstrom International Airport, and the
Special Operations Division,which includes the SWAT team, Bomb Squad, Air Support Unit,
and K-9 Unit. As Assistant Chief of the Bomb Squad and SWAT Team, he led the Special
Operations response and resolution to recent Austin Bombing incident.
"I am humbled and excited to become the next Chief of the Denton Police Department," said
Chief Dixon. "The Denton Police Department is composed of dedicated men and women who
proudly serve the community. My goals as Chief will be to continue to engage the Denton
community, work with citizens to make Denton safer, and create partnerships with civic,
neighborhood, and community groups to address the unique and diverse issues facing
communities today."
Chief Dixon holds a Bachelor of Science in Criminal Justice from Lamar University and is a
graduate of the 73rd session of the Senior Management Institute for Police by the Police
Executive Research Forum, APD's Leadership Command College, and the West Point
Leadership Course. Prior to being appointed Assistant Chief, Dixon was a lieutenant in the
Internal Affairs Division, and has previously served as a lieutenant in the Organized Crime
Division and the Region 3 Patrol Services Division. He has also served in other various roles,
including uniformed patrol, Street Response,Narcotics, Gang Unit/Major Crimes Task Force,
Homicide Detective, Patrol K-9, SWAT Sergeant, and Counter-Assault Strike Team.
The City of Denton started the selection process in June by working with executive recruitment
firm Ralph Andersen &Associates to launch a nationwide search for candidates. After a
thorough review and screening of 111 applicants, six finalists were interviewed by executive
staff, two community organization panels with 20 groups represented, a panel of current DPD
OUR CORE VALUES
Integrity•Fiscal Responsibility•Transparency• Outstanding Customer Service
ADA/EOE/ADEA www.cityofdenton.com TDD(800)735-2989
employees, and held a meet and greet with City Council Members. In addition, the candidates
were introduced to the Denton community through a public open house,which provided citizens
the opportunity to provide feedback on all candidates. To make the final selection, a City team
conducted site visits with two finalists, with Chief Dixon being selected as the top candidate.
Contact: Carla Romine, (940) 349-8344, Carla.Romine@cityofdenton.com
Visit www.cityofdenton.com for more news and to stay updated.
2
nor FOR IMMEDIATE RELEASE
DENTON Jessica Rogers • (940) 349-7531 • Jessica.Rogers@cityofdenton.com
Notice of Meeting for Public Input on City Hall West
Patterson-Appleton Arts Center, Sept. 10 at 5:30 p.m.
DENTON, TX, Sept. 6, 2018—The City of Denton invites interested members of the
community to attend a public meeting to provide input on the conceptual design and potential
renovation options for City Hall West. The meeting will be from 5:30 to 7:30 p.m. on Monday,
Sept. 10 at the Patterson-Appleton Arts Center, 400 E. Hickory St.
Mark Nelson, Director of Transportation, and the project consultants will present a history of the
project, conceptual design and conceptual business plan that has been developed with direction
through the City Hall West Steering Committee. Steering Committee members will also be in
attendance. For those unable to attend, information will be posted on the City's website,
www.cityofdenton.com, following the meeting and an online comment card will be available
through Sept. 14 to provide feedback.
Contact: Mark Nelson, (940) 349-7704, Mark.Nelson@cityofdenton.com
OUR CORE VALUES
Integrity•Fiscal Responsibility•Transparency• Outstanding Customer Service
ADA/EOE/AREA www.cityofdenton.com TDD(800)735-2989
Sat. Nite 8:45-1Opm Presenting Sponsor Sun. Nite 7:30-8:30PM
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Sunday Morning
Friday Nite Karaoke / f' Gospel Choirs
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QUAKERTOWN PARK 321 E. McKinney Denton, TX
Delicious festival food ! FREE Parking !
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For more information contact J. Baines (940) 565-9015 or S. Hill (210) 275-3486
DENTON
DCTATRANSPORTCOUNTYATION
AUTHORITY
Media Contact Information:
Adrienne Hamilton, Communications Manager
Phone: 972.316.6114 • Email: ahamilton(a)dcta.net
Nicole Recker, Vice President of Marketing and Communications
Phone: 972.316.6132 • Email: nrecker(a)dcta.net
FOR IMMEDIATE RELEASE
Denton County Transportation Authority Board of Directors Names
Raymond Suarez as President of DCTA
LEWISVILLE, TEXAS (September 4, 2018)—Today, the Denton County Transportation Authority
(DCTA) Board of Directors have accepted the resignation of James C. Cline, Jr., DCTA President.
The board met to discuss immediate next steps for the agency and made a motion naming Raymond
Suarez as the new agency president, effective September 14, 2018, pending contract negotiations.
Suarez has served as DCTA's Chief Operating Officer since July 2014. He is a proven transit
operations and technology leader with more than 30 years of experience in the public and private
sector.
"We greatly appreciate the leadership provided by Mr. Cline over the last eight years," said Nicole
Recker, DCTA Vice President of Marketing and Communications. "The Board of Directors and
agency staff are confident that Mr. Suarez will continue to foster DCTA's growth and ability to
provide mobility solutions throughout North Texas."
Suarez previously served as DCTA's chief operating officer and worked with the leadership team,
board of directors, community leaders, employees, and service providers to grow the greater North
Texas regional mobility system with a focus on setting new standards for transit operations,
innovation and service excellence.
Prior to DCTA, Suarez served as chief administrative officer for the Trinity Railway Express (TRE), in
which he oversaw aspects of THE contracts, safety, operations, maintenance, and capital programs.
During his tenure, Suarez developed the agency's annual budget, managed the TRE's long range
capital investment program and state of good repair model, and worked with the regional transit
agencies to ensure adherence to annual authorizations. Prior to the TRE, Suarez served in multiple
leadership roles within the transit and technology industries, including Dallas Area Rapid Transit
(DART), Reactrix Systems, General Dynamics, Superconducting Supercollider, Trans Industries,
and Vultron, Inc.; and provided consulting services for various companies throughout his career.
Suarez holds a Bachelor's Degree in Business Administration from Texas Wesleyan University.
ABOUT DENTON COUNTY TRANSPORTATION AUTHORITY
Formed in 2002 and funded in 2003,the Denton County Transportation Authority has been focused on an aggressive service
implementation strategy to address the mobility needs of North Texas residents.The central element ofthe agency's service
plan is the A-train,which connects with the Dallas Area Rapid Transit's(DART)Green Line at Trinity Mlls in Carrollton and
provides service to five stations within Denton County.In addition to the A-train,DCTAprovides Connect Bus service in Denton
and Lewisville,Connect Shuttle and Community On-Demand services in Highland Village,Access service,Frisco Demand-
Response service,Collor County Transit service,North Texas Xpress conumter bus service in partnership with Trinity Nbtro,
University ofNorth Texas(UNI)and North Central Texas College(NM Campus Shuttle and vanpool services.The agency
caries nearly three million passengers annually systemwide.For more information about DCTA,visit www.RideDCTAnet.
Date: September 7, 2018 Report No. 2018-115
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
This is a report of expenses for outside consultants and professional services for the City's capital
project funds.
BACKGROUND:
The purpose of this report is to provide the Mayor and City Council with a report summarizing
expenses for outside consultants and professional services for the City's capital project funds in
the last three fiscal years. There is no action necessary as this report is for informational purposes
only.
This report has been prepared at the request of the city Council. This report is only for expenses
associated with capital projects. It shows expenses by general category for the last three fiscal
years. This information was obtained by reviewing all of the payments in the capital projects funds
during the fiscal year sorted by individual vendor. It shows purchase orders by general category
and the dollar amount of the full purchase order is based on the fiscal year in which the service
was approved. In many cases the actual payments for these services may occur over of period of
one year or longer. The summary also shows the full amount of the purchase order, but some
projects may not spend the full amount.
DISCUSSION:
Below is a table displaying major areas of expenses for outside consultants and professional
services in capital project funds during fiscal years 2014-15, 2015-16, and 2016-17. The total
capital project fund expenditures for FY 2014-15 was $117,525,289, in FY 2015-16 was
$119,992,274, and in FY 2016-17 was $276,029,736.
Category FY 2014-15 FY 2015-16 FY 2016-17
Engineering and Architectural Design $ 10,039,622 $ 5,778,038 $ 7,199,668
Land, Survey, and Appraisal Services 91,723 229,480 2,989,426
Legal Services 551,118 130,000 195,796
Construction Testing Services 453,568 200,420 564,745
Other Services* 747,989 446,851 2,507,453
Total $ 11,884,020 $ 6,784,789 $ 13,457,088
*Other services include utility studies, rate studies, cost allocation studies, software implementation,
program management assistance,permitting assistance,and project management assistance.
These expenses are below the expected range of 8%to 15%for capital project expenditures related
to design and other professional services. This percentage can vary significantly from year to year
Date: September 7, 2018 Report No. 201 8-115
depending on the timing of engineering contracts versus construction contracts. After reviewing
the expenses in these categories, and considering the types of services received, staff concluded
that no personnel or contract modifications are necessary. Please do not hesitate to contact me if
you have any questions regarding this report.
STAFF CONTACT:
Antonio Puente, Jr., Director of Finance
(940)-349-7283
Antonio.Puente(cr�,cityofdenton.com
Date: September 7, 2018 Report No. 2018-116
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
This is a report of expenses for outside consultants and professional services for the past four fiscal
years.
BACKGROUND:
The purpose of this report is to provide the Mayor and City Council with a report summarizing
expenses and commitments for outside consultants and professional services for the past three
fiscal years. There is no action necessary as this report is for informational purposes only.
This report has been prepared at the request of Council. This report excludes expenses associated
with capital projects. It shows purchase orders by general category and the dollar amount of the
full purchase order is based on the fiscal year in which the service was approved. In many cases
the actual payments for these services may occur over a period of one year or longer. The summary
also shows the full amount of the purchase order,but some projects may not spend the full amount.
DISCUSSION:
Below is a chart displaying major areas of expenses and committments for outside consultants and
professional services for fiscal years 2014-2015 through 2016-2017:
Category FY 2014-15 FY 2015-16 FY 2016-17
Architectural Design $ 8,494 $ 8,013 $ 27,225
Audit/Finance Services 116,873 84,933 61,316
Energy Services - 362,448 494,977
Capital Projects 282,237 309,888 190,791
Environmental Planning 74,300 32,920 246,850
HR Recruitment and Studies 79,497 133,588 157,161
Legal Services 1,038,945 107,085 264,602
Legislative Services 266,771 249,900 277,730
Marketing 10,125 - -
Planning and Development 44,030 24,500 25,725
Risk and Health Contracts 48,500 25,432 121,814
Technology Implementation 311,011 253,491 85,430
Training and Retreats 23,240 75,784 36,036
Transportation & Mobility - 147,740 138,098
Total $ 2,304,023 $ 1,815,722 $ 2,127,755
Percent of Operating Budget 0.44% 0.33% 0.36%
After reviewing the expenses in these categories, and considering the types of services received,
staff concluded that no personnel or contract modifications are necessary. Staff will continue
Date: September 7,2018 Report No. 2018-116
monitoring these professional services. If it appears that these needs will be recurring in nature, or
these services can be provided by in-house staff, we will adjust our contracts and/or personnel
accordingly. Please do not hesitate to contact me if you have any questions regarding this report.
STAFF CONTACT:
Antonio Puente, Jr., Director of Finance
(940)-349-7283
Antonio.Puente(ab cityofdenton.com
Date: September 7, 2018 Report No. 2018-117
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
The purpose of this report is to provide the City Council with details regarding the recently
completed Playground Replacement Plan (PRP).
BACKGROUND:
The Parks and Recreation Department (PARD) recently completed a PRP and are in the
processes of replacing a number of play structures with several more planned to be installed in
the future.
DISCUSSION:
In June, 2018, PARD completed an inventory and replacement plan for all playgrounds within
the Denton parks system. The PRP identifies when the playground was installed and when it
should be scheduled for replacement. The plan also tracks the cost of the structure when it was
installed along with a forecasted replacement cost when it exceeds its expected life span. This
projection uses a 3% cost inflator compounded annually as a way to anticipate future costs of the
playgrounds based on the projected replacement.
It was discovered during the creation of the plan that a number of play structures are well past
the 15 years useful life. While the 15 year life span is not a requirement for replacement, it is an
industry estimated term in which a playground typical begins to diminish in its structural
integrity and repair costs exceed its value. Based on wear and tear, some playgrounds need to be
replaced sooner than others due to varying degrees of usage, exposure to sunlight, or vandalism.
While replacement years are projected and flexible, staff has worked to program replacement
expenses distributed over the course of multiple years. The goal is to get the playgrounds on a
regular replacement schedule to ensure safety and assist in fiscal planning. A heat map style was
used to clearly identify playgrounds that are past the replacement timeframe (highlighted in red),
on schedule (highlighted in green) and structures that are anticipated (none) to be replaced earlier
than the 15 years (highlighted in blue). In addition, some playgrounds (highlighted in orange)
already have funding that has been identified. As you can see within the plan, 43% of all the
playgrounds within the park system (not including the structures that already are funded) have
exceeded the standard 15 year life span.
On July 17, at a City Council Work Session, Parks and Recreation was asked about the
possibility of donating playground equipment after it was removed for replacement. Staff
discussed this option along with Risk Management and the City Attorney's Office and all agree
that this could be a liability issue for the City. In addition, the equipment would need to be
dismantled, free of all concrete without damage and parts organized in a manner that rebuilding
can be completed in a safe and organized process so it could be rebuilt by another entity.
Date: September 7, 2018 Report No. 2018-117
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Fred Moore Park Playground—Coming in October 2018
Also, on July 17 at the regularly scheduled City Council meeting, a contract for the replacement
of three (3) playgrounds was approved. These playgrounds include Denia Park, Fred Moore
Park and Milam Park. Funding for theses playgrounds, plus others was approved in the 2014
Capital Improvement Program for a total of$890,000.
Additionally, a new playground will be installed as part of the G. Roland Athletics Complex. It
is anticipated that this project will be completed in March 2019.
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Date: September 7, 2018 Report No. 201 8-117
Finally, a Community Development Block Grant was recently released due to unallocated
funding availability. An application was submitted to Community Development for $217,923 to
replace play structures at Quakertown Park. Grants are expected to be awarded to the selected
projects this fall.
r � '
Existing Quakertown Park Playground
STAFF CONTACT:
Drew Huffman, Parks Superintendent
(940) 349-7464
Russell Koch, Parks Manager
(940) 349-8412
Date: September 7, 2018 Report No. 2018-118
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
City of Denton and Denton Municipal Electric's strategies for securing information and
information systems
EXECUTIVE SUMMARY:
The purpose of this report is to address Public Utility Board's request for information regarding
the City of Denton's and Denton Municipal Electric's security strategies for the infrastructures
supporting its information and bulk electric systems.
BACKGROUND:
Critical infrastructure and utility providers have seen an increase in threats to information system
breaches that, if successful, could result in a considerable amount of damage to critical
infrastructure, affect public safety and could cost providers millions of dollars to cover the costs
related to the attacks. Recent news uncovered possible vulnerabilities that many U.S.-based
providers might be susceptible to, including:
• Hackers have shown the ability to electronically infiltrate control rooms of electric utilities,
and can cause blackouts and other disruptions to the power grids;
• Hackers have compromised some isolated utility networks thought to be secure, and control
switches to the power grid to disrupt power flow; and
• Hackers have gained access utility providers' networks through compromising vendors' and
contractors' systems.
Although widespread catastrophic exploitation of these vulnerabilities has not occurred in the
United States, they have heightened the concerns of many citizens. To mitigate the risk of
malicious intruders, DME relies, to an extent, on the City of Denton's Technology Services
Department for security management programs that establish a framework and continuous cycle
of activity for assessing risk, developing and implementing effective security procedures, and
monitoring the effectiveness of these procedures. The Technology Services Department has been
proactive in implementing multiple layers of protection for IT supported technologies. Over the
past year, the department has detected and mitigated approximately 1.6 billion total threats and
vulnerabilities. On average, approximately 50,000 malicious webpages are blocked per month.
Additionally, approximately 18 million emails were received at the City this past year; in which,
64%percent were detected as spam and 3.6%were detected as malware.
Without a comprehensive security plan and industry best practices in place, even the best
systems can be compromised. Multiple security tools, practices and procedures have been
Date: September 7, 2018 Report No. 2018-118
implemented during the last several years to protect the systems against unauthorized access and
viruses. Some of these include:
• Secure architecture and design validated by third party
• Electronic and physical security controls
• Strong password policies and access controls
• Controlled use of administrative privilege
• Proactive monitoring and analysis of logs
• Annual vulnerability assessments,penetration testing and tabletop exercises
• Site and hardware redundancy that includes a backup Data Center
• Incident response plan and business continuity plan
• Comprehensive cyber security policies
• Security retainers with companies specializing in information security for rapid response
• Scheduled patch management
• Periodic social engineering exercises to staff
• Proactive cyber security training for all City employees
• Formation of an Information Security Committee, which includes members from various
departments across the City, to create a holistic approach to information security governance,
risk management, and compliance.
• Other various security technologies
o Perimeter Security: firewall, Intrusion Detection and Prevention Systems IDS/IPS,
demilitarized zone (DMZ) for public facing applications, e-mail scanning(anti-virus)
o Network Security: firewall, web proxy, wireless security, enterprise remote access,
security information and event systems
o Endpoint Security: desktop firewall, anti-virus,patch management, local security
policies
o Application Security: application testing, code review, database monitoring,
o Data Security: drive encryption, data archive, data wiping, data classification, identity
access management
Additionally, the operations at Denton Municipal Electric (DME) adds another layer of security
through its Compliance Program regulated by the North American Electric Reliability
Corporation's (NERC) Critical Infrastructure Protection (CIP) Standards, which are designed to
increase the security and reliability of the Bulk Electric System (BES). The NERC CIP
Standards cover many areas that are typically considered in many Cyber Security programs
across the industry, such as:
• Identifying the level of impact on each BES Cyber System to ensure appropriate controls
and protection are in place
Date: September 7, 2018 Report No. 2018-118
• Implementing security management controls to minimize the opportunity for
misoperation of the BES
• Implementing appropriate training for all employees
• Securing electronic and physical perimeters
• Evaluating and installing security updates and patches to all applicable systems
• Ensuring the latest virus signatures/definitions are installed on antivirus applications,
intrusion detection systems, and firewalls
• Testing of incident response and disaster recovery plans on a regular basis to ensure any
downtime is minimize
• Tracking and managing all changes to the BES system, and ensure that no changes go
undetected
• Enforcing a strict information security policy specific to working with BES
DME also employs annual cyber security training specific to critical infrastructure security and
protection program for employees working in or with BES Cyber Systems and will soon
implement a compliance software system to increase efficiency and effectiveness in its
compliance management program.
Although DME has taken due care to protect its ratepayers and citizens through these programs,
DME can only protect what it has actual operational control over. DME, like every other utility,
must also rely on its neighboring interconnected utilities that are part of the ERCOT network to
do their role.
Overall, the city of Denton is committed to safeguarding the city of Denton assets. Although it is
hard to predict and foresee every possible threat, companies that implement a comprehensive
information security program increase their chances of protecting physical assets, employees and
customer data if a dangerous situation arises.
STAFF CONTACT:
Melissa Kraft George Morrow
Chief Technology Officer General Manager, Electric Administration
(940) 349-7823 (940) 349-8487
Melissa.Kraft(d,cityofdenton.com George.Morrow(a,cityofdenton.com
Date: September 7, 2018 Report No. 2018-119
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
Notice of Public Hearing on Denton Central Appraisal District 2019-2020 Reappraisal Plan.
BACKGROUND:
The Denton Central Appraisal District will be holding a public hearing on their reappraisal plan
for the 2019-2020 appraisal year. The public hearing will be held on September 13, 2018 at 3:00
p.m. at 3911 Morse Street, Denton, Texas.
Attached for your review is the draft 2019-2020 Reappraisal Plan. Once the plan has been
approved by both the DCAD Board of Director and the Texas Comptroller's Office, the final
plan will be forwarded to the City.
If you have any questions or need additional information, please let me know.
STAFF CONTACT:
Antonio Puente, Jr., Director of Finance
(940) 349-7283
Antonio.Puente@cityofdenton.com
Notice on Public Hearing On
Denton Central Appraisal District
2019-2020 Reappraisal Plan
The Denton Central Appraisal District will hold a public hearing on their
biennially reappraisal plan for the 2019-2020 appraisal year.
The public hearing will be held on September 13, 2018 at 3:00 pm
at 3911 Morse Street, Denton, Texas.
Last update on: 08/31/16
DENTON CENTRALAPPRAISALDISTRICT
2019 - 2020
REAPPRAISAL PLAN
PropertyTax Appraisal.............................................................................................................................................4
SUBSECTION 1. GENERAL POLICIES AND PROCEDURES....................................................................................4
1.01 Appraisal............................................................................................................................................................4
1.02 Valuation Components of a Mass Appraisal System....................................................................................... 13
1.03 DCAD Appraisal Card..................................................................................................................................... 14
1.04 Appraisal Codes............................................................................................................................................... 18
1.05 Ethical Conduct...............................................................................................................................................26
1.06 Notice of Appraised Value...............................................................................................................................40
SUBSECTION 2.REAL PROPERTY APPRAISAL......................................................................................................46
Part A.General Policies and Procedures......................................................................................................................46
2.01 Introduction......................................................................................................................................................46
PartB.Commercial Property.......................................................................................................................................46
2.02 Introduction......................................................................................................................................................46
2.03 Valuation Approach.........................................................................................................................................48
2.04 Data Collection/Validation..............................................................................................................................50
2.05 Class System....................................................................................................................................................52
2.06 Valuation and Statistical Analysis(model calibration)....................................................................................53
2.07 Residential Vacant Lots...................................................................................................................................74
2.08 Individual Value Review Procedures...............................................................................................................81
2.09 Performance Tests............................................................................................................................................82
2.10 Value Defense Procedures...............................................................................................................................83
2.11 Education and Training....................................................................................................................................84
2.12 Data Entry Procedure.......................................................................................................................................84
2.13 Commercial Department Reappraisal Plan Overview......................................................................................84
PartC.Agriculture Use................................................................................................................................................85
2.21 Application......................................................................................................................................................85
2.22 Qualification....................................................................................................................................................86
2.23 Appraisal of Agricultural Land........................................................................................................................87
2.24 Rollback Procedure..........................................................................................................................................89
2.25 Wildlife Management .....................................................................................................................................92
PartD.Residential Properties......................................................................................................................................95
2.31 Introduction......................................................................................................................................................95
2.32 Valuation Approach(model specification)......................................................................................................97
2.33 Data Collection/Validation..............................................................................................................................99
2.34 Class System.................................................................................................................................................. 100
2.35 Valuation and Statistical Analysis(model calibration) ................................................................................. 101
2.36 Individual Value Review Procedures............................................................................................................. 109
2.37 Performance Tests.......................................................................................................................................... 110
2.38 Value Defense Procedures............................................................................................................................. 116
2.39 Education and Training.................................................................................................................................. 116
FIELD CLASSIFICATION GUIDE..................................................................................................................... 117
PartE.Appraisal of Mobile Homes........................................................................................................................... 135
2.41 Inventories..................................................................................................................................................... 136
2.42 Park Rosters................................................................................................................................................... 136
2.43 Installation Permits........................................................................................................................................ 136
2.44 Taxpayer........................................................................................................................................................ 136
2.45 Field Inspection............................................................................................................................................. 137
2.46 Classification of Mobile Home...................................................................................................................... 137
2.47 Creation of Improvement Only...................................................................................................................... 137
2.48 Maintenance Improvement Only Accounts................................................................................................... 138
2.49 Mobile Home on Land Accounts................................................................................................................... 139
2.50 Mobile Home Valuation................................................................................................................................ 139
PartF. Sales and Research......................................................................................................................................... 153
2.51 Sales and Research Department..................................................................................................................... 153
2.52 Education and Training.................................................................................................................................. 153
2.61 Introduction.................................................................................................................................................... 154
2.62 Sales and Statistical Analysis......................................................................................................................... 155
2
2.63 Performance Tests......................................................................................................................................... 156
2.64 Data Collection Procedures........................................................................................................................... 157
2.65 Procedures for Analyzing and Adjusting Sales Prices.................................................................................. 163
2.66 Value Defense Procedures for Informal Meetings and Formal Hearings...................................................... 164
2.67 Procedures for Responding to the Public...................................................................................................... 165
2.68 Reproduction Costs on Open Records.......................................................................................................... 166
2.69 Taxpayer Information on Open Records....................................................................................................... 171
2.70 Taxpayer Liaison Officer.............................................................................................................................. 172
SUBSECTION 3.APPRAISAL OF BUSINESS PERSONAL PROPERTY................................................................ 174
3.01 Introduction.................................................................................................................................................... 174
3.02 General Policies and Procedures.................................................................................................................... 175
3.03 Methods of Discovery.................................................................................................................................... 176
3.04 Procedures for Informal Meetings and Participating in Appraisal Review Board Hearings.......................... 179
3.05 Situs and Inspection of Personal Property..................................................................................................... 179
3.06 Estimation of Property Value......................................................................................................................... 182
3.07 Motor Vehicle Dealer's Special Inventory.....................................................................................................207
3.08 Utility,Mineral Property................................................................................................................................211
3.09 Valuation Bibliography.................................................................................................................................230
CALENDAROF EVENTS............................................................................................................................................231
3
Property Tax Appraisal
SUBSECTION 1. GENERAL POLICIES AND PROCEDURES
1.01 Appraisal
Each year the Chief Appraiser shall analyze all categories of property that fall within the boundaries of the Denton
Central Appraisal District and re-appraise where necessary. The following procedures shall govern the appraisal
process using the mass appraisal system.All through this procedure,testing of schedules will be done using
acceptable statistical analysis. All appraisal standards must comply with standards#6 and#7 of the Uniform
Standards of Professional Appraisal Practice(USPAP).DCAD also administers and determines eligibility for
various types of property tax exemptions that are authorized by state and local governments;such as homestead,
over-65,disabled persons,disabled veterans,and charitable or religious exemptions. The District will update and
process exemptions and special use appraisal applications as necessary and applicable.
The following was taken directly form Uniform Standards of Professional Appraisal Practice publication:
Appraisal Standards Board; The Appraisal Foundation.
Uniform Standards of Professional Appraisal Practice (USPAP):
Standard 6: Mass Appraisal,Development and Reporting
In reporting the results of a mass appraisal, an appraiser must communicate each analysis,
opinion, and conclusion in a manner that is not misleading.
Comment: STANDARD 6 addresses the content and level of information required in a report
that communicates the results of a mass appraisal.
STANDARD 6 does not dictate the form, format, or style of mass appraisal reports. The form,
format, and style of a report are functions of the needs of intended users and appraisers. The
substantive content of a report determines its compliance.
STANDARDS RULE 6-1
Each written report of a mass appraisal must:
(a) clearly and accurately set forth the appraisal in a manner that will not be misleading;
(b) contain sufficient information to enable the intended users of the appraisal to understand the
report properly; and
Comment: Documentation for a mass appraisal for ad valorem taxation may be in the form of(1)property
records, (2) sales ratios and other statistical studies, (3)appraisal manuals and documentation, (4)market
studies, (5)model building documentation,(6)regulations, (7) statutes, and(8)other acceptable forms.
(c)clearly and accurately disclose all assumptions,extraordinary assumptions,hypothetical
conditions, and limiting conditions used in the assignment.
4
Comment: The report must clearly and conspicuously:
• state all extraordinary assumptions and hypothetical conditions; and
• state that their use might have affected the assignment results.
STANDARDS RULE 6-2
Each written report of a mass appraisal must:
(a) state the identity of the client,unless the client has specifically requested otherwise; state the
identity of any intended users by name or type;
Comment: An appraiser must use care when identifying the client to avoid violations of the
Confidentiality section of the ETHICS RULE. If a client requests that the client's identity be withheld
from the report,the appraiser may comply with this request. In these instances,the appraiser must
document the identity of the client in the workfile and must state in the report that the identity of the client
has been withheld at the client's request.
(b) state the intended use of the appraisal;
(c) disclose any assumptions or limiting conditions that result in deviation from recognized
methods and techniques or that affect analyses, opinions, and conclusions;
(d) state the effective date of the appraisal and the date of the report;
Comment: In ad valorem taxation the effective date of the appraisal may be prescribed by law. If no
effective date is prescribed by law,the effective date of the appraisal, if not stated,is presumed to be
contemporaneous with the data and appraisal conclusions.
The effective date of the appraisal establishes the context for the value opinion,while the date of
the report indicates whether the perspective of the appraiser on the market and property as of the
effective date of the appraisal was prospective, current,or retrospective.
(e) state the type and definition of value and cite the source of the definition;
Comment: Stating the type and definition of value also requires any comments needed to clearly indicate
to intended users how the definition is being applied.
When reporting an opinion of market value, state whether the opinion of value is:
•In terms of cash or of financing terms equivalent to cash; or
•Based on non-market financing with unusual conditions or incentives.
When an opinion of market value is not in terms of cash or based on financing terms equivalent to
cash, summarize the terms of such financing and explain their contributions to or negative
influence on value.
(f) state the properties appraised including the property rights;
5
Comment: The report documents the sources for location,describing and listing the property. When
applicable,include references to legal descriptions,addresses,parcel identifiers,photos,and building
sketches. In mass appraisal this information is often included in property records.When the property
rights to be appraised are specified in a statute or court ruling,the law must be referenced.
(g) summarize the scope of work used to develop the appraisal; exclusion of the sales comparison
approach,cost approach,or income approach must be explained;
Comment: Because intended users' reliance on an appraisal may be affected by the scope of work,the
report must enable them to be properly informed and not misled. Sufficient information includes
disclosure of research and analyses performed and might also include disclosure of research and analyses
not performed.
When any portion of the work involves significant mass appraisal assistance,the appraiser must describe
the extent of that assistance. The signing appraiser must also state the name(s) of those providing the
significant mass appraisal assistance in the certification, in accordance with Standards Rule 6-3.
(h) summarize and support the model specification(s) considered,data requirements, and the
model(s)chosen;
Comment: The appraiser must provide sufficient information to enable the client and intended users to
have confidence that the process and procedures used conform to accepted methods and result in credible
value conclusions. In the case of mass appraisal for ad valorem taxation, stability and accuracy are
important to the credibility of value opinions. The report must include a summary of the rationale for each
model,the calibration techniques to be used, and the performance measures to be used.
(i) summarize the procedure for collecting,validating, and reporting data;
Comment: The report must summarize the sources of data and the data collection and validation
processes. Reference to detailed data collection manuals or electronic records must be made, as
appropriate, including where they may be found for inspection.
0) summarize calibration methods considered and chosen, including the mathematical form of the
final model(s); summarize how value conclusions were reviewed; and, if necessary, state the
availability and location of individual value conclusions;
(k)when an opinion of highest and best use,or the appropriate market or market level was
developed, summarize how that opinion was determined;
Comment: The mass appraisal report must reference case law, statute,or public policy that describes
highest and best use requirements. When actual use is the requirement,the report must discuss how use-
value opinions were developed. The appraiser's reasoning in support of the highest and best use opinion
must be provided in the depth and detail required by its significance to the appraisal.
(1)identify the appraisal performance tests used and the performance measures attained;
(m) summarize the reconciliation performed, in accordance with Standards Rule 5-7; and
(n)include a signed certification in accordance with Standards Rule 6-3.
6
STANDARDS RULE 6-3
Each written mass appraisal report must contain a signed certification that is similar in content to the
following form:
I certify that,to the best of my knowledge and belief:
—the statements of fact contained in this report are true and correct.
—the reported analyses,opinions,and conclusions are limited only by the reported assumptions
and limiting conditions,and are my personal, impartial, and unbiased professional analyses,
opinions, and conclusions.
—I have no(or the specified)present or prospective interest in the property that is the subject of
this report, and I have no (or the specified)personal interest with respect to the parties involved.
—I have performed no(or the specified) services, as an appraiser or in any other capacity,
regarding the property that is the subject of this report within the three-year period immediately
preceding acceptance of this assignment.
—I have no bias with respect to any property that is the subject of this report or to the parties
involved with this assignment.
—my engagement in this assignment was not contingent upon developing or reporting
predetermined results.
—my compensation for completing this assignment is not contingent upon the reporting of a
predetermined value or direction in value that favors the cause of the client,the amount of the
value opinion,the attainment of a stipulated result, or the occurrence of a subsequent event
directly related to the intended use of this appraisal.
—my analyses, opinions,and conclusions were developed, and this report has been prepared, in
conformity with the Uniform Standards of Professional Appraisal Practice.
—I have (or have not)made a personal inspection of the properties that are the subject of this
report. (If more than one person signs the report,this certification must clearly specify which
individuals did and which individuals did not make a personal inspection of the appraised
property.)
—no one provided significant mass appraisal assistance to the person signing this certification.
(If there are exceptions,the name of each individual providing significant mass appraisal
assistance must be stated.)
Comment: The above certification is not intended to disturb an elected or appointed assessor's work plans
or oaths of office. A signed certification is an integral part of the appraisal report. An appraiser,who signs
any part of the mass appraisal report, including a letter of transmittal,must also sign this certification.
In an assignment that includes only assignment results developed by the real property appraiser(s), any
appraiser(s)who signs a certification accepts full responsibility for all elements of the certification, for the
assignment results,and for the contents of the appraisal report. In an assignment that includes personal
property assignment results not developed by the real property appraiser(s), any real property appraiser(s)
who signs a certification accepts full responsibility for the real property elements of the certification, for
the real property assignment results, and for the real property contents of the appraisal report.
In an assignment that includes only assignment results developed by the personal property appraiser(s),
any appraiser(s)who signs a certification accepts full responsibility for all elements of the certification,
for the assignment results,and for the contents of the appraisal report. In an assignment that includes real
property assignment results not developed by the personal property appraiser(s), any personal property
appraiser(s)who signs a certification accepts full responsibility for the personal property elements of the
7
certification,for the personal property assignment results,and for the personal property contents of the
appraisal report.
When a signing appraiser(s)has relied on work done by appraisers and others who do not sign the
certification,the signing appraiser is responsible for the decision to rely on their work. The signing
appraiser(s)is required to have a reasonable basis for believing that those individuals performing the
work are competent. The signing appraiser(s) also must have no reason to doubt that the work of those
individuals is credible.
The names of individuals providing significant mass appraisal assistance who do not sign a certification
must be stated in the certification. It is not required that the description of their assistance be contained in
the certification,but disclosure of their assistance is required in accordance with Standards Rule 6-2(g).
In developing a personal property appraisal, an appraiser must identify the problem to be solved,
determine the scope of work necessary to solve the problem, and correctly complete research
and analyses necessary to produce a credible appraisal.
Comment: STANDARD 7 is directed toward the substantive aspects of developing a credible
appraisal of personal property. The requirements set forth in STANDARD 7 follow the appraisal
development process in the order of topics addressed and can be used by appraisers and the users of
appraisal services as a convenient checklist.
STANDARDS RULE 7-1
In developing a personal property appraisal, an appraiser must:
(a) be aware of,understand, and correctly employ those recognized methods and techniques that
are necessary to produce a credible appraisal;
Comment: This Standards Rule recognizes that change continues to affect the manner in which appraisers
perform appraisal services. Changes and developments in personal property practice have a substantial
impact on the appraisal profession. Important changes in the cost and manner of acquiring,producing, and
marketing personal property and changes in the legal framework in which appraisers perform their
assignments result in the need for corresponding changes in personal property appraisal theory and
practice. Social change has also had an effect on appraisal theory and practice. The appraisal profession
responds to changing circumstances with revised and new appraisal methods and techniques. Therefore, it
is not sufficient for appraisers to maintain the skills and the knowledge they possess when they become
appraisers. Each appraiser must improve and update his or her skills and knowledge to remain proficient
in the appraisal of personal property.
(b) not commit a substantial error of omission or commission that significantly affects an
appraisal; and
Comment: An appraiser must use sufficient care to avoid errors that would significantly affect his or her
opinions and conclusions. Diligence is required to identify and analyze the factors, conditions, data, and
other information that would have a significant effect on the credibility of the assignment results.
8
(c) not render appraisal services in a careless or negligent manner, such as by making a series of
errors that, although individually might not significantly affect the results of an appraisal, in
the aggregate affect the credibility of those results.
Comment: Perfection is impossible to attain, and competence does not require perfection. However, an
appraiser must not render appraisal services in a careless or negligent manner. This Standards Rule
requires an appraiser to use due diligence and care.
STANDARDS RULE 7-2
In developing a personal property appraisal, an appraiser must:
(a)identify the client and other intended users;
(b)identify the intended use of the appraiser's opinions and conclusions;
Comment: An appraiser must not allow the intended use of an assignment or a client's objectives to cause
the assignment results to be biased.
(c)identify the type and definition of value, and ascertain whether the value is to be:
(i) in terms of cash; or
(ii) in terms of financial arrangements equivalent to cash; or
(iii) in other precisely defined terms; and
(iv) if the opinion of value is to be based on non-market financing or financing with
unusual conditions or incentives,the terms of such financing must be clearly
identified and the appraiser's opinion of their contributions to or negative influence
on value must be developed by analysis of relevant market data;
Comment: When reasonable exposure time is a component of the definition for the value opinion
being developed,the appraiser must also develop an opinion of reasonable exposure time linked to
that value opinion.
(d) identify the effective date of the appraiser's opinions and conclusions;
(e) identify the characteristics of the property that are relevant to the type and definition of value
and intended use of the appraisal, including:
(i) sufficient characteristics to establish the identity of the item including the method of
identification;
(ii) sufficient characteristics to establish the relative quality of the item(and its
component parts,where applicable)within its type;
(iii)all other physical and economic attributes with a material effect on value;
Comment: Some examples of physical and economic characteristics include condition, style, size, quality,
manufacturer,author,materials, origin, age,provenance, alterations,restorations, and obsolescence. The
type of property,the type and definition of value,and intended use of the appraisal determine which
characteristics have a material effect on value.
9
(v) the ownership interest to be valued;
(vi) any known restrictions, encumbrances,leases, covenants, contracts, declarations,
special assessments, ordinances, or other items of a similar nature if relevant to the
assignment; and any real property or intangible items that are not personal property
but which are included in the appraisal;
Comment on(i)^(vi): The information used by an appraiser to identify the property characteristics must
be from sources the appraiser reasonably believes are reliable.
An appraiser may use any combination of a property inspection and documents or other resources to
identify the relevant characteristics of the subject property.
When appraising proposed modifications, an appraiser must examine and have available for future
examination, documentation sufficient to identify the extent and character of the proposed modifications.
An appraiser may not be required to value the whole when the subject of the appraisal is a fractional
interest, a physical segment, or a partial holding.
(f)identify any extraordinary assumptions necessary in the assignment;
Comment: An extraordinary assumption may be used in an assignment only if.
• it is required to properly develop credible opinions and conclusions;
•the appraiser has a reasonable basis for the extraordinary assumption;
•use of the extraordinary assumption results in a credible analysis; and
•the appraiser complies with the disclosure requirements set forth in USPAP for extraordinary
assumptions.
(g) identify any hypothetical conditions necessary in the assignment; and
Comment: A hypothetical condition may be used in an assignment only if-
-use of the hypothetical condition is clearly required for legal purposes, for purposes of reasonable
analysis, or for purposes of comparison;
•use of the hypothetical condition results in a credible analysis; and
•the appraiser complies with the disclosure requirements set forth in USPAP for hypothetical conditions.
(h)determine the scope of work necessary to produce credible assignment results in accordance
with the SCOPE OF WORK RULE.
STANDARD RULE 7-3
In developing a personal property appraisal,when necessary for credible assignment results, an appraiser
must:
(a) analyze the property's current use and alternative uses as relevant to the type and definition of
value and intended use of the appraisal;
Comment: In the context of personal property,value can be a function of the choice of the appropriate
market or, in some cases,market level for the type of item,the type and definition of value, and the
intended use of the appraisal.
The appraiser must consider the various uses of the property when viable alternative uses exist and when
those alternative uses may result in a different value.
10
(b) define and analyze the appropriate market consistent with the type and definition of value;
and
Comment: The appraiser must recognize that there are distinct levels of trade(measureable marketplaces)
and each may generate its own data.For example, a property may have a different value at a wholesale
level of trade,retail level of trade, or under various auction conditions. Therefore,the appraiser must
analyze the subject property within the correct market context.
(c) analyze the relevant economic conditions that exist on the effective date of the valuation,
including market acceptability of the property and supply, demand, scarcity or rarity.
STANDARDS RULE 7-4
In developing a personal property appraisal, an appraiser must collect,verify, and analyze all information
necessary for credible assignment results.
(a) When a sales comparison approach is necessary for credible assignment results, an appraiser
must analyze such comparable sales data as are available to indicate a value conclusion.
(b)When a cost approach is necessary for credible assignment results,an appraiser must:
(i)analyze such comparable cost data as are available to estimate the cost new of the
property; and
(ii) analyze such comparable data as are available to estimate the difference between cost
new and the present worth of the property(depreciation).
(c)When an income approach is necessary for credible assignment results, an appraiser must:
(i)analyze such comparable data as are available to estimate the market income of the
property;
(ii) analyze such comparable operating expense data as are available to estimate the
operating expenses of the property;
(iii)analyze such comparable data as are available to estimate rates of capitalization
and/or rates of discount; and
(iv)base projections of future income and expenses on reasonably clear and appropriate
evidence.
Comment: An appraiser must, in developing income and expense statements and cash flow
projections,weigh historical information and trends, current supply and demand factors affecting such
trends, and competition.
(d) When developing an opinion of the value of a lease, leased, or encumbered property, an
appraiser must analyze the effect on value,if any, of the terms and conditions of the lease(s)
or encumbrances.
(e) When appraising multiple objects,the appraiser must consider the significance of the value of
the individual assets to the assignment results. Those objects which are more significant to
the assignment results should be the focus of the analysis and analyzed in appropriate detail.
Comment: A group of objects may have a mix of high and low value items. Those objects that are more
significant to the assignment results should be subject to a greater and appropriate depth of analysis.
11
(f) When analyzing the assemblage of the various component parts of a property, an appraiser
must analyze the effect on value, if any,of the assemblage. An appraiser must refrain from
valuing the whole solely by adding together the individual values of the various component
parts.
Comment: Although the value of the whole may be equal to the sum of the separate parts, it also may
be greater than or less than the sum of such parts. Therefore,the value of the whole must be tested by
reference to appropriate data and supported by an appropriate analysis of such data.
A similar procedure must be followed when the value of the whole has been established and the appraiser
seeks to value a part. The value of any such part must be tested by reference to appropriate data and
supported by an appropriate analysis of such data.
(g) When analyzing anticipated modifications to the subject property, an appraiser must analyze
the effect on value, if any,of such modifications to the extent they are reflected in market
actions.
(h) When real property or intangible items are included in the appraisal,the appraiser must
analyze the effect on value of such non-personal property items.
Comment: When the scope of work includes an appraisal of real property or intangible items, competency
in real property appraisal(see STANDARD 1) or business appraisal(see STANDARD 9)is required. In
addition,competency in other types of personal property outside of the appraiser's specialty area may be
necessary(see STANDARD 7 and the COMPETENCY RULE).
STANDARDS RULE 7-5
When necessary for credible assignment results, an appraiser must, if such information is available to the
appraiser in the normal course of business:
(a) analyze all agreements of sale,validated offers or third-party offers to sell,options, and
listings of the subject property current as of the effective date of the appraisal if warranted by
the intended use of the appraisal; and
(b) analyze all prior sales of the subject property that occurred within a reasonable and applicable
time period if relevant given the intended use of the appraisal and property type.
Comment: The data needed for the required analyses in Standards Rule 7-5(a)and 7-5(b)may not be
available or relevant in all assignments. See the Comments to Standards Rules 8-2(a)(viii) and 8-2(b)(viii)
for corresponding reporting requirements.
STANDARDS RULE 7-6
In developing a personal property appraisal, an appraiser must:
(a) reconcile the quality and quantity of data available and analyzed within the approach or
approaches used; and
(b)reconcile the applicability and relevance of the approach or approaches,methods and
techniques used to arrive at the value conclusion(s).
12
1.02 Valuation Components of a Mass Appraisal System
A. Direct Sales Comparison
Each year, all sales and appraisals that can be reasonably obtained will be gathered. Sources of sales and
appraisals can come from MLS, closing statements,renditions,fee appraisers and any other reliable
source. The sales and fee appraisals are be sorted by school district, subdivision or abstract,by category
and in some cases by class of improvement and ratio of appraised value to sale or fee appraisal. The sales
and fee appraisals will be used to establish schedules for valuation purposes.
B. Cost Approach
The cost schedule,based on construction of similar improvements,will be developed from information
gathered from reliable sources such as Marshall and Swift, a national publication of building cost; and
local builders, local suppliers and any other sources considered reliable. Once the cost schedule is
verified from available sales,the residential and commercial departments shall compare gathered sales
and appraisals to all improved properties in each subdivision and abstract within the boundaries of the
Denton Central Appraisal District. hi all, cases any changes made in value should be as to market value
using mass appraisal system. Sales will be compared to all properties in an area,not just to one individual
property.Appraising property is not an exact science, so valuing large numbers of properties at one time
will reflect some low values, some high values and some values in the middle.
C. Income Approach
The income approach to value will be used when the direct sales comparison and cost approach to value
would not give indication of market value. Renditions, state schedules published by the Comptroller's
Office, information furnished by property owner/agents,National publications, and any other reliable
sources will be used to determine market value by the income approach.
D. Land Valuation
Land values will be developed from an analysis of comparable sales. These sales will be used to develop
a schedule of land values for abstract, subdivision and commercial land. Changes will be made to the
land schedules based on comparable sales analysis,with the goal of achieving fair market values and
uniformity of appraised values.
E. Valuation of Agricultural Use Land
Agricultural use values will be determined from information gathered from ASCS,Texas A&M
University State Agricultural Dept.,Agricultural Income publication published by TU Electric, or any
other reliable source. Information gathered will determine the makeup of the valuation schedule for
cropland,pasture land and wasteland.
F. Comptroller
The State Ratio Study conducted by the Comptroller of Public Accounts, Property Tax Division,will be
considered in re-appraising individual categories of property.
13
1.03 DCAD Appraisal Card
Appraisal Codes
Denton Central Appraisal District's appraisal card,for Real Property,Business Personal Property, or
Mineral will consist(in part or whole)of the following information categories:
A. Account Information
1. Property ID Number
2. Legal Description
3. GEO ID
4. Map ID
5. Situs
6. Property Group Codes
7. Last Inspection Date/Appraiser
8. Next Inspection Date/Reason
B. Ownership and Exemptions
1. Owner Name and Address
2. Percent Ownership
3. Effective Acreage
4. Applied Exemptions
5. Taxing Entities
C.Value Breakdown
1. Improvement/Land Values
2. Current and Prior Year Market Values
3. Ag Production Loss
4. Appraised Values
5. Homestead Cap Loss
6. Taxable Value
D. Remarks and Sketch Commands
E. Active Permit Information
1. Date
2. Type and Comments
F. Income Approach Data
1. Rent/Vacancy Information
2. Expenses
3. Net Operating Income
G. Tax Agent and Informal/Protest Information
1. Agent Contact Information
2. Inquiry/ARB Dates and Status
14
H. Property Photo and Sketch
1. Photo with Account Number and Photo Date
2. Sketch with Dimensions and Area ID
I. Sales and Deed History
1. Date
2. Price
3. Transaction Type
4. Recording Information
J. Improvement Valuation
1. Subdivision Code and Neighborhood Code/Factor
2. Segment ID
3. Improvement Type
4. Detail Description
5. SPTB Method
6. Class
7. Detail Area and Total Area
8. Detail Area Unit Price
9. Actual and Effective Year Built
10. Condition Type
11. Values and Total Value Before Depreciation,Obsolescence, or%Complete
12. Detail Depreciation%Good
13. Detail Physical,Economic,Functional, and Completion%Good
14. Detail Total% Good Adjustment
15. Adjusted Values and Total Adjusted Value
16. State Code and Homesite Declaration
17. Living Area
K. Other Improvement%Good Adjustments and Features
1. Adjustment Type
a. Additional Percent Good 1. Imp_Mod Adjustment
b. Adjustment Percentage m. Improvement Modifier
c. Arena no Roof n. Inventory
d. Condition o. Location
e. Drilling Site p. Obsolescence
f. Economic q. Open air arena w/roof
g. End Unit 26 r. Over built for area
h. End Unit 26A s. Physical percent
i. End Unit 26B t. Quality of Construction Adj
j. Flooding u. Rental Property
k. Foundation v. Split Entity
2. Feature Description
3. Feature Count and Value
15
L. Land Valuation
1. Subdivision Code and Neighborhood Code/Factor
2. Segment ID
3. Segment Description
4. Segment Type
5. Land Table Name
6. Soil
7. State Code
8. Land Table
9. State Code
10. Homesite Declaration
11. Appraisal Method Code
12. Size
13. Unit Price
14. Segment%Adjustment
15. Segment Mass Adjustment
16. Segment Market Values and Total Market Value
17. Adjustment Type
a. Access p. lmod
b. Area q. loc
c. bldr r. lsize
d. condo s. lview
e. culde t. move
f, drain u. prem
g. ease v. ptdev
h. econ w. row
i. flood X. ry
j. flway y. shape
k. func Z. split
1. golf aa. topo
m. green bb. treed
n. 1-meth cc. undev
o. lake dd. water
18. Ag Declaration and Use
19. Ag Use Type
20. Ag Use Table
21. Ag Unit Price and Value
16
See illustration below:
DENTON CENTRAL APPRAISAL DISTRICT PROPERTY FIELD REOEW CARD 2019 = 20194-221523.411540
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A VA %MAREA R 6 20E60 6376 .'Mi=5 - 146134VI 097 131494 ExteriotW'all 1 Bn^k 0
5 AG ArTAC1E1MW R a 6140 23M 2001 M14134W% 090 lzrn Fkeptaoe 1 1 0
C OP OPEN PORCM R b' 1580 1046 2001 I'm - 116 M% 090 14M Foundabon I SLAB 0
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E MA2 SEM FLOOR R a 765.0 62278 2001 M 4027M 090 L32:1 IntenotFMi5C I Sheet 0
T. RES STCD:Al 3.M.1 (E2005) Hornesite:Y(100;9) 229,694 Living Area;3,146 206,725 Plumbing 1 3 2,000
----------------------------------------------------------------------------------------------------------------
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Page 1 of 1 Effective Date of Appraisal:January I Date Printed: &1&2018 12:03:07PM by terryn True A.utomator,Irc
1.04 APPRAISAL CODES
Entity Codes
C38 City of Haslet(Tarrant Co.)
County, Cities, Schools C39 City of Grapevine
C40 City of Newark(Wise Co.)
C41 City of Rhome(Wise Co.)
G01 Denton County C42 Town of Dish
C43 City of Keller(Tarrant Co.)
CAD Appraisal District C44 Town of Westlake
C45 City of New Fairview(Wise Co.)
C01 City of Aubrey C46 City of Aurora(Wise Co.)
CO2 City of Carrollton C47 City of Corral City
CO3 City of The Colony C48 Town of Prosper
C04 City of Corinth C49 City of Celina
C05 City of Denton C50 City of Hebron
C06 City of Eastville C51 Town of Providence Village
C07 Town of Flower Mound
C08 City of Highland Village
C09 City of Justin S01 Argyle ISD
C 10 City of Krum S02 Aubrey ISD
C11 City of Lake Dallas S03 Carrollton/Farmers Branch ISD
C12 City of Lewisville SO4 Celina ISD
C13 Town of Little Elm S05 Denton ISD
C14 City of Pilot Point S06 Frisco ISD
C15 Town of Ponder S07 Krum ISD
C16 City of Sanger S08 Lake Dallas ISD
C17 City of Roanoke S09 Lewisville ISD
C 18 City of Krugerville S 10 Little Elm ISD
C19 Town of Hickory Creek S11 Northwest ISD
C20 City of Dallas S 12 Pilot Point ISD
C21 City of Coppell S 13 Ponder ISD
C22 City of Hackberry S 14 Sanger ISD
C23 Town of Marshall Creek S 15 Era ISD
C24 City of Oak Point S 16 Slidell ISD
C25 City of Lakewood Village S 17 Prosper ISD
C26 Town of Argyle S 18 Coppell ISD
C27 Town of Copper Canyon S 19 Grapevine ISD
C28 Town of Trophy Club S20 Carroll ISD
C29 City of Plano
C30 Town of Double Oak
C31 Town of Bartonville
C32 City of Frisco
C33 Town of Northlake
C34 Town of Shady Shores
C35 Town of Cross Roads
C36 City of Fort Worth
C37 City of Southlake
18
Special Districts WO1 Colony MUD
W02 Lake Cities MUA
FO1 Denton County Fire District W03 Trophy Club MUD#1
LO1 Denton Co. Levy Imp District W04 Clearcreek Watershed Authority
W05 Trophy Club MUD#2
PLAN Builder Home Plans W06 Do not use
W07 Corinth MUD#1
E01 Denton CED W08 Lake Turner Municipal Util Dist#1
E02 Denton CED W09 Denton Co. FWSD 1-A
E03 Carrollton CED W10 Denton Co. FWSD 1-B
E05 Denton CED W11 Denton Co. FWSD 1-C
E07 Denton CED W12 Denton Co. FWSD 1-D
E08 Denton CED W13 Denton Co. FWSD 6
E09 Denton CED W 14 Denton Co. Dev Dist#4
E10 Denton CED W15 Denton Co. FWSD 1-E
Ell Denton CED W16 Providence Village WCID
E12 Denton CED W17 Denton Co. FWSD#10
E13 Denton CED W18 Denton Co. FWSD 8-A
E14 Denton CED W19 Denton Co. FWSD 8-B
ESD1 Denton Co. Emergency Service District W20 Denton Co. FWSD 11-A
ESD2 Trophy Club PID#1 Emergency Service W21 Denton Co. FWSD 7
PID 1 Lewisville Public Improvement Dist#1 W22 Denton Co.MUD#4
PID2 Allegiance Public Improvement Dist#1 W23 Denton Co.Mud#5
PID3 Castle Hills PID W24 Denton Co. FWSD 8-C
PID4 Town of Trophy Club PID#1 W25 Denton Co. FWSD 11-13
PID5 Briarwyck Public Improvement District W26 Denton Co. FWSD 4-A
PID6 Hackberry Hidden Cove Public W27 Oak Point WCID#1
Improvement District W28 Oak Point WCID#2
PID7 Northlake PID#1 W29 Oak Point WCID#3
W30 Smiley Road WCID
W31 Denton Co. FWSD 1-F
ROl Denton Co. Reclamation, Rd&Util Dist W32 Denton Co. FWSD 11-C
RUD Denton Co. RUD W33 North Fort Worth WCID#1
W34 Denton Co. FWSD 1-G
W35 Valencia on the Lake WCID#1
TO1 Speedway TIF#1 W36 Denton Co FWSD 1-H
T02 Speedway TIF#2 W36 South Denton County WCID#1
T03 Flower Mound TIRZ#1 W38 Alpha Ranch WCID
TIF1 City of Lewisville TIRZ#1 W39 Belmont FWSD#1
TIF2 City of Lewisville TIRZ#2 W40 Mobberly MUD
TIF3 Little Elm TIRZ#1 W41 The Lakes FWSD
TIF4 Little Elm TIRZ#2 W42 Canyon Falls WCID#2
TIF5 The Tribute TIF#1 W43 Oak Point WCID#4
TIF6 Downtown TIF#1 W44 Canyon Falls MUD#1
W45 Belmont FWSD#2
XO1 Tribute at The Colony W46 Fort Worth MUD#1
W47 Denton Cty MUD#6
19
Exemption Codes
AB Abatement
AG EOY: AG
CH Charitable
CHODO 11.182 Community Housing Development Organizations
CLT Community Land Trust
DP Disability
DPS DISABLED Surviving Spouse
DVI Disabled Veterans 10%-29%
DVIS Disabled Veterans Surviving Spouse 10%-29%
DV2 Disabled Veterans 30%-49%
DV2S Disabled Veterans Surviving Spouse 30%-49%
DV3 Disabled Veterans 50%-69%
DV3S Disabled Veterans Surviving Spouse 50%-69%
DV4 Disabled Veterans 70%- 100%
DV4S Disabled Veterans Surviving Spouse 70%- 100%
DVCH Disabled Veteran Charity Homestead
DVCHS Disabled Veteran Charity Homestead Surviving Spouse
DVHS Disabled Veteran Homestead
DVHSS Disabled Veteran Homestead Surviving Spouse
ECO Economic Development
EN Energy
EX Exempt
EX-XA 11.111 Public property for housing indigent persons
EX-XD 11.181 Improving property for housing with volunteer labor
EX-XF 11.183 Assisting ambulatory health care centers
EX-XG 11.184 Primarily performing charitable functions
EX-XH 11.185 Developing model colonia subdivisions
EX-XI 11.19 Youth spiritual,mental, and physical development organizations
EX-XJ 11.21 Private schools
EX-XL 11.231 Organizations Providing Economic Development Services to Local Community
EX-XM 11.25 Marine cargo containers
EX-XN 11.252 Motor vehicles leased for personal use
EX-XO 11.254 Motor vehicles for income production and personal use
EX-XP 11.271 Offshore drilling equipment not in use
EX-XQ 11.29 Intracoastal waterway dredge disposal site
EX-XR 11.30 Nonprofit water or wastewater corporation
EX-XS 11.33 Raw cocoa and green coffee held in Harris County
EX-XT 11.34 Limitation on taxes in certain municipalities
EX-XU 11.23 Miscellaneous Exemptions
EX-XV Other Exemptions(including public property,religious organizations,
charitable organizations, and other property not reported elsewhere)
20
EX366 HB366 Exempt
FR Freeport
FRSS First Responder Surviving Spouse
GIT GOODS IN TRANSIT
HS Homestead
HT Historical
LIH 11.181 Improving property for housing with volunteer labor
LVE Leased Vehicles
MASSS Member Armed Services Surviving Spouse
OV65 Over 65
OV65S OV65 Surviving Spouse
PC Pollution Control
PPV Personal Property Vehicle
SO Solar
21
Property Classification Codes
SPTB Codes
Al.....Residential Single Family
J1.....Water Systems/Real and BPP
A2.....Residential Mobile Home
J2.....Gas Companies/Real and BPP
A3.....Single Family Waterfront
J3.....Electric Companies
A4.....Condominium
J4.....Telephone&Communication/Real and BPP
A5.....Townhome
J5.....Railroads
A6.....Single Family Golf Course
J6.....Pipelines
AT.....Tax Abatement Real
J7.....Railroad-Non-Operating
B1.....Residential Multi-family
J8.....Cable Companies
B2.....Duplex
K1.....Farm Machinery&Equip.
C1.....Vacant Platted Lots/Tracts
L I.....Tangible Commercial/Personal
C2.....Commercial Lots In City
L2.....Industrial Personal
C3.....Lots Outside City
LA.....Tax Abatement Personal
C5.....Waterfront
M2....Aircraft
D1.....Qualified Open-Space Land
D2..... Farm/Ranch Imps on Qualified Ag Land
E I.....Rural Land/Improvement on Non Ag Land
Improvement Type Codes
E3.....Mobile Homes on Non Ag Land
E4.....Vacant Non Ag Land C......Commercial
FI.....Real, Commercial I........Misc Improvement
F2.....Real, Industrial M......Mobile Home
F3.....Commercial-Real-MH Parks R......Residential
F4.....Commercial-Real Office Condo
Gl.....Oil, Gas, and Mineral Reserves
HI.....Personal Vehicles
I1.....Banks-Real
Building Attributes
Exterior Wall
Construction Style Adobe Brick
A Frame Aluminum siding
American Mansard Asbestos Siding
Brownstone Asphalt Siding
Bungalow Brick Veneer
California Bungalow Cedar
Cape Cod Concrete Block
Colonial American Concrete Tilt Up Walls
Contemporary Hardboard
English Tudor Log
Fiberglass Metal Siding
Fireproof Structural Steel Plywood
French Provincial Rock
Greek Revival Shakes
Log Shingles
Masonry or Concrete Load Bearing Walls Siding
Mediterranean Steel/Metal
Metal Stone
Mission Stucco
Prefabricated Steel Frame Synthetic Plaster(EIFS)
Ranch Tile
Reinforced Concrete Columns Vinyl Siding
Shingle Style Wood
Southern Colonial FEET ........ Ceiling"Exterior Wall Height"
Split Full
Victorian Interior Finish
Wood
Concrete
Wood or Steel Frame Drywall
Foundation Plaster
Sheetrock
B.....Concrete Block
M....Mason Roof Style
P......Pier Dome
S......Slab Flat
Gable
Hip
Mansard
23
Roof Covering
Asphalt
Composition Shingle
Copper
Fiberglass
Metal
Roll
Shake
Slate
Spanish Tile
Tile
Wood Shingle
Unknown
Foundation
Concrete Block
Mason
Pier
Slab
Heat and Air
CH(Central Heat)
CHCA(Central Heat and Air)
Cold Storage
Facility
Fuel Furnace
Fireplace
Gas Stove
Moist Air
Window Unit
Solar
24
Land Appraisal Method Agricultural Use Property Codes
A Acreage AG AG Use Granted
F Flat Price AGLATE Late AG application
FA Flat Acreage AG.RECD AG application received
F-SFT Flat Square Foot AG.SENT AG Wildlife application
FF Front Foot sent
LT Flat Priced Per Lot AG_INT AG internal transfers
SL Special Lot Pricing request new application
SQ Square Foot AG_RC AG Re-check
AG_RC2 AG Re-check again
AG_SENT_INT_1 AG App sent internal
Land Type Codes change
AG—SENT—NEW-1 AG Appsent new owner
I Homesite letter 1
2 Cropland AG_SENT_RF_1 AG App sent refile
3 Pasture letter
4 Woods AG_LGL AG Legal Description
5 Wasteland Change
6 Commercial AG_NOPEN AG App Deadline
7 Rear Lot Extended
8 Residential Lot AG OV65 Ag Applied with OV65
9 Waterfront Lot Exemption
10 Timberland AG OV65 SENT1 AG OV 65 First letter
AG Agriculture Exempt sent
C1 Cropland I AB_OV65_SENT2 AG OV 65 Second
C2 Cropland I1 letter sent
C3 Cropland III AG5% AG use under protest
CA Common Area AGCKRB Check AG for rollback
H Hanger AGD AG use denied
IL Improved Lot AGLATEDENY Denied Late AG
PI1 Improved Pasture I application
P12 Improved Pasture II AGOWNER AG use new owner
P13 Improved Pasture III AGPRCI6 2016 AG application
PN1 Native Pasture I AGSUR AG use survey letter
PN2 Native Pasture II DORB Do Rollback
PN3 Native Pasture III RBLTS AG use rollback letters
UD Undeveloped RF Request to re-file AG
UL Undeveloped Lot application
W Wasteland AGLATE2016 Remove penalty flag
2016
25
1.05 Ethical Conduct
Title 16. Texas Department of Licensing and Regulation
Chapter 94 Administrative Rules of the Texas Department of Licensing and Regulation
Effective January 1,2014
A. General
For the property tax system to achieve its intended purpose of providing funds for those activities that are
essential to the public welfare,not only must the entire process be fair and equitable to all taxpayers, and
to each taxpayer individually, it must be so perceived by them and the public at large. These rules are
directed toward the achievement of that goal.
Persons registered with the Texas Department of Licensing and Regulation(TDLR) shall perform their
duties in accordance with applicable laws,rules and regulations; and shall avoid the act or appearance of
improper influence, conflict of interest, discrimination,abuse of powers,unfair treatment or misuse of
titles by conforming to the Rules stated in the following document.
PROPERTY TAX PROFESSIONALS
Title 16 Texas Administrative Code
Chapter 94
Administrative Rules of the Texas Department of Licensing and Regulation
Effective January 1, 2014
Table of Contents
94.1. Authority
94.10. Definitions
94.20. Persons Required to Register
94.21. Registration
94.22. Renewal of Registration
94.24. Inactive Status
94.25. Continuing Education
94.70. Responsibilities of a Registrant: General
94.71. Responsibilities of a Registrant: Equal and Fair Treatment
94.72. Responsibilities of a Registrant: Conflicts of Interest
94.73. Responsibility of Registrant: Use of Titles
94.80. Fees
94.90. Sanctions and Administrative Penalties
94.91. Enforcement Authority
94.100. Code of Ethics
26
94.1.Authority. (New rule effective January 18, 2010, 35 TexReg 367)
This chapter is promulgated under the authority of Texas Occupations Code, Chapters 51 and 1151.
94.10.Definitions. (New rule effective January 18, 2010, 35 TexReg 367; amended effective January 1,
2011, 35 TexReg 11625)
The following words and terms,when used in this chapter,have the following meanings,unless the
context clearly indicates otherwise:
(1)Act--Texas Occupations Code, Chapter 1151.
(2)Registered Texas Collector(RTC)--Certified Class III Collector.
(3)Registered Professional Appraiser(RPA)--Certified Class IV Appraiser.
(4)Registered Texas Assessor/Collector(RTA)--Certified Class IV Assessor/Collector.
(5)USPAP--Uniform Standards of Professional Appraisal Practice.
94.20.Persons Required to Register. (New rule effective January 18, 2010, 35 TexReg 367; amended
effective January 1, 2014, 38 TexReg 9524)
Those required to register are:
(1)the chief appraiser of an appraisal district, an appraisal supervisor or assistant,a property tax
appraiser, an appraisal engineer,and any other person authorized to render judgment on,
recommend, or certify an appraised value to the appraisal review board of an appraisal district;
(2)a person who engages in appraisal of property for ad valorem tax purposes for an appraisal
district or a taxing unit;
(3)an assessor-collector, other than a county assessor-collector,a collector,or another person
designated by a governing body as the chief administrator of the taxing unit's assessment
functions, collection functions,or both; and
(4)a person who performs assessment or collection functions for a taxing unit and is required to
register by the chief administrator of the unit's tax office.
94.21.Registration. (New rule effective January 18, 2010, 35 TexReg 367; amended effective January 1,
2011, 35 TexReg 11625; amended effective January 1, 2014, 38 TexReg 9524)
To be registered an applicant must:
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(1)be at least 18 years of age;
(2)be a resident of the State of Texas;
(3)be a person of good moral character;
(4)be a graduate of an accredited high school or holder of high school graduation equivalency;
(5)be actively engaged in appraisal, assessing/collecting, or collecting for an appraisal district,
tax office,or private firm working for an appraisal district or tax office;
(6) submit a completed application on a form approved by the department;
(7)pay the applicable fees under§94.80; and
(8) successfully complete all requisites appropriate for the applicant's classification level:
(A)Appraisers
(i)A Class I appraiser must be registered.
(ii)A Class II appraiser must:
(I)be a Class I appraiser registrant; and
(II) successfully complete within twelve months of registration:
(-a-)no less than 32 hours in the basics of the Texas property tax system;
(-b-)no less than 8 hours in ethics; and
(iii)A Class III appraiser must:
(I)be registered as a Class II appraiser registrant; and
(II) successfully complete within thirty-six months of registration:
(-a-)no less than 18 hours in the income approach to value;
(-b-)no less than 18 hours in the theory and practice of personal property
appraisal;
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(-c-)no less than 15 hours in USPAP;
(-d-)no less than 24 hours in the theory and practice of appraisal of real property;
and
(-e-)pass the Class III examination.
(iv)A Class IV appraiser(RPA)must:
(I)be registered as a Class III appraiser registrant; and
(II) successfully complete within sixty months of registration:
(-a-)no less than 18 hours in analyzing real property appraisal;
(-b-)no less than 16 hours in Texas Property Tax Law; and
(-c-)no less than 18 hours in mass appraisal;
(III) successfully complete no less than 3.5 hours in USPAP if the 15 hour USPAP
course has not been completed in the last two years;
(IV)pass the appraiser Class IV examination within five years of registration; and
(V)have a minimum of three years experience as a registered appraiser.
(B)Assessor/Collectors
(i)A Class I assessor/collector must be registered.
(ii)A Class II assessor/collector must:
(I)be registered as a Class I assessor/collector registrant; and
(II) successfully complete within twelve months of registration:
(-a-)no less than 32 hours in the basics of the Texas property tax system; and
(-b-)no less than 8 hours in ethics.
(iii)A Class III assessor/collector must:
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(I)be registered as a Class II assessor/collector registrant; and
(II) successfully complete within thirty-six months of registration:
(-a-)no less than 16 hours in Texas Property Tax Law; and
(-b-)no less than 18 hours in assessment and collection.
(iv)A Class IV assessor/collector(RTA)must:
(I)be registered as a Class III assessor/collector registrant;
(II) successfully complete within sixty months of registration:
(-a-)no less than 18 hours in advanced assessment and collections;
(-b-)no less than 12 hours in truth in taxation;
(III)pass the Class IV assessor/collector examination within five years of
registration; and
(IV)have a minimum of three years experience as a registered assessor/collector.
(C) Collectors
(i)A Class I collector must:
(1)be registered; and
(II) successfully complete within twelve months of registration:
(-a-)no less than 32 hours in the basics of the Texas property tax system; and
(-b-)no less than 8 hours in ethics.
(ii)A Class II collector must:
(1)be registered as a Class I registrant; and
(II) successfully complete:
(-a-)no less than 16 hours in Texas Property Tax Law;
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(-b-)no less than 18 hours in assessment and collection; and
(-c-)no less than 18 hours in advanced assessment and collections.
(iii)A Class III collector(RTC)must:
(I)be registered as a Class II collector registrant;
(Il)pass the collector Class III examination within three years of registration; and
(I1I)have a minimum of two years experience as a registered collector.
(D) The provisions in this paragraph apply to registrations that renew on or after January 1,
2011.
94.22.Renewal of Registration. (New rule effective January 18, 2010, 35 TexReg 367; amended
effective January 1, 2011, 35 TexReg 11625)
(a)All registrations expire one year after the day issued. The Department may extend the
expiration date of a registration to correspond to the registrant's original registration date.
(b)To renew an applicant must:
(1)comply with all provisions of the Act and this chapter;
(2) submit a completed application on a department-approved form;
(3)pay the applicable fees; and
(4) successfully complete all requisites appropriate for the renewal applicant's classification
level.
(c)To renew and maintain continuous registration,the renewal requirements must be completed
prior to the expiration of the registration.
(d)Applications not filed by the expiration date are considered applications for late renewal and
are subject to late renewal fees under§60..83 of this title (relating to Late Renewal Fees).
(e)Registrations issued from a late renewal application will have an unregistered period from the
expiration date of the previous registration to the issuance date of the renewed registration. Work
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that requires a registration issued under this chapter must not be performed during the
unregistered period.
(f)A registrant must complete all registration renewal requirements within one year of the date
the registration expires, or the renewal application shall be deemed void.
(g)If the registrant does not meet the deadline established in subsection(f),the person must
reapply for a new registration by complying with the requirements and procedures, including any
examination requirements and payment of fees.
(h)Non-receipt of a renewal notice from the department does not exempt a person from any
requirement of this chapter.
94.24.Inactive Status. (New section effective March 1, 2012, 37 TexReg 1325)
(a)To change a registration to inactive status, an applicant must submit a completed application
on a department-approved form.
(b)A person whose registration is on inactive status may not engage in activity requiring a
registration.
(c)A registration on inactive status must be renewed in accordance with §94.22;however,
continuing education is not required for renewal of a registration on inactive status.
(d)The time period to obtain certification requirements is stopped for the duration the registration
is on inactive status.
(e)To change from an inactive registration to an active registration, an applicant must:
(1) submit a completed application on a department-approved form;
(2)pay the applicable fee; and
(3)complete the continuing education that is required for the renewal of an active registration
during the preceding registration period. Continuing education hours used to satisfy the
requirement for changing from an inactive license status to an active license status may not
also be utilized for a future renewal of an active registration.
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94.25. Continuing Education. (New rule effective January 18, 2010, 35 TexReg 367; amended effective
January 1, 2011, 35 TexReg 11625; amended effective March 1, 2012 37TexReg 1325; amended effective
January 1, 2014, 38 TexReg 9524)
(a)Terms used in this section have the meanings assigned by Chapter 59 of this title,unless the
context indicates otherwise.
(b)A Registered Professional Appraiser(RPA)must complete 30 hours of approved continuing
education to be eligible to renew the registration. The continuing education must include:
(1)two hours in ethics as required by§94.250)(3);
(2)a state laws and rules update course; and
(3) 3.5 hours in USPAP.
(c)A Registered Professional Appraiser(RPA)that is a chief appraiser must complete 30 hours
of approved continuing education to be eligible to renew the registration. The continuing
education must include:
(1) 3.5 hours in USPAP;
(2)a state laws and rules update course;
(3)two hours in chief appraiser ethics, as required by§94.250)(3); and
(4) 15 hours in one or more of the topics listed in §94.250)(1), (3), (4), (5), or(6).
(5)The provisions of subsection(c)are effective for those registrations expiring on or after
January 1,2015.
(d)A Registered Texas Assessor-Collector(RTA)must complete 30 hours of approved
continuing education to be eligible to renew the registration. The continuing education must
include:
(1)two hours in ethics; and
(2)a state laws and rules update course.
(e)A Registered Texas Collector(RTC)must complete 10 hours of approved continuing
education to be eligible to renew the registration. The continuing education must include:
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(1)two hours in ethics; and
(2)a state laws and rules update course.
(f) Continuing education credit must be completed during the 24 month period before the
expiration of the license.Newly certified registrants are not required to complete continuing
education until their second renewal after their certification deadline.
(g)For a late renewal,the continuing education hours must have been completed within the two-
year period prior to the date of renewal.
(h)A course approved for use under§94.21 may be taken for continuing education credit.
(i)A registrant may not receive continuing education credit for attending the same department-
numbered course more than once within the two-year period prior to the date of renewal.
0)To be approved by the Comptroller,a provider's course must be dedicated to instruction in:
(1)appraisal procedures and methods;
(2)tax assessment and collection;
(3)ethics;
(A)general; or
(B) chief appraiser;
(4)laws and rules;
(5)USPAP; or
(6)customer service.
(k) The provisions in this section apply to registrations that renew on or after January 1, 2011.
94.26.Break In Service Credit(New section effective March 11 2012, 37 TexReg 1325)
(a)A registrant may receive an adjustment of their anniversary date for a break in service as
defined in Texas Occupations Code, §1151.160(f)by:
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(1) submitting a completed form approved by the department; and
(2)paying the applicable fee.
(b)An applicant for credit under this provision must provide proof, acceptable to the department,
of time during which the person was not employed in the type of employment for which the
person was registered. If no proof is available,the department may award credit for"break in
service" as it determines from previous department registration records.
(c)Under no circumstances will a break in service credit exceed five years.
94.27.One-Year Extension. (New section effective March 1, 2012, 37 TexReg 1325)
(a)A registrant may receive a one-year extension to meet certification requirements by:
(1) submitting a completed form approved by the department;
(2)paying the applicable fee; and
(3) submitting supporting documentation deemed appropriate by the department for extension
under Texas Occupations Code, §1151.160(g).
(b)The extension will begin on the day after the original deadline for certification,regardless of
when the extension is requested or on the discretion of the department.
94.28. Re-application. (New section effective March 1, 2012, 37 TexReg 1325)
An applicant that does not meet any of the requirements for extension under Texas Occupations Code,
§1151.160(g), and does not qualify for reinstatement under Texas Occupations Code, §1151.1605,may
reapply for registration after being unregistered for two years by:
(1)paying the applicable fee for new application;
(2) submitting a completed form approved by the department; and
(3)qualifying as class II registrant.
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94.70.Responsibilities of a Registrant: General. (New rule effective January 18, 2010, 35 TexReg 367;
amended effective January 1, 2011, 35 TexReg 11625)
(a)A registrant must not violate any provision of the Act or this chapter.
(b)A registrant must timely respond to the department's investigative requests including making a
complete written answer to any complaint.
(c)Registrants must inform the department within 30 days of any changes to their employment
and change their registration as appropriate.
(d)A registrant must not violate the property tax professional's Code of Ethics,referenced in
§94.100, or aid or encourage another to violate the Code of Ethics.
(e)A registrant must not engage in any practices that constitute acts of improper influence,
conflict of interest,unfair treatment, discrimination, abuse of powers, or misuse of titles.
(f)A registrant must be in compliance with any report issued by the Comptroller of Public
Accounts under §5.102 of the Tax Code.
(g)An appraisal registrant or assessor/collector must be certified in their field within five years of
registration.
(h)A collector registrant must be certified in their field within three years of registration.
(i)A registrant may act in a purely private capacity regarding a personal tax matter so long as he
does not use his official position to influence the outcome of such a dispute.
94.71.Responsibilities of a Registrant: Equal and Fair Treatment. (New rule effective January 18,
2010, 35 TexReg 367)
(a)A registrant must apply equally and fairly any appraisal, assessment, or consulting service
according to the Uniform Standards of Professional Appraisal Practice and generally accepted
appraisal,assessment, or collection practices applicable to an assignment.
(b)A registrant may not accept or solicit any benefit in return for favorable treatment.
(c)A registrant must not knowingly testify falsely or withhold any information,or influence
anyone into testifying falsely or withholding any information in any investigation or proceeding.
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(d)A registrant must not knowingly mislead any member of the public who makes a reasonable
inquiry or request on tax matters.
(e)A registrant must not predetermine the value or value range of a property or properties and
then manipulate data to arrive at a predetermined conclusion.
(f)A registrant must not perform calculations:
(1)by methods other than those directed by law,rule,or written guidance of the Comptroller
of Public Accounts,or
(2)that are designed to result in a predetermined effective tax rate,or rollback tax rate,
current or delinquent collection rate, or other value,rate, or ratio used for official purposes.
(g)A registrant must not provide,to any private party,information that is not provided to, or
reasonably available to all persons.
94.72.Responsibilities of a Registrant: Conflicts of Interest. (New rule effective January 18, 2010, 35
TexReg 367)
(a)A registrant must disclose in writing to the appraisal district or taxing entity any relationship
of consanguinity within the third degree that may relate to an assignment so long as he holds a
registration position.
(b)A registrant must disclose in writing to the appraisal district or taxing entity any outside
employment.
(c)A registrant must disclose in writing to the appraisal district or taxing entity any financial
interest in any private business or real property subject to the appraisal district or taxing entity
where she is employed.
(d)A registrant must not invest in property,interests, or transactions which create a conflict of
interest or which affects independent judgment or performance in the official position.
(e)A registrant must not engage in any activity or employment outside of the appraisal office or
tax office if such engagement adversely affects his impartiality in the execution of his official
duties or adversely affects the performance of his official duties.
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(f)A registrant must not use agency resources for the personal benefit of himself,any party in
whom he has an interest, or any public servant; or for the benefit of any social or political
organization unless any member of the general public could make similar use of the agency
resources.
(g)A registrant in their official capacity must not endorse the services or products of any person
or firm.
94.73.Responsibility of Registrant: Use of Titles. (New rule effective January 18, 2010, 35 TexReg
367) A person may not use the titles Registered Professional Appraiser,Registered Texas
Assessor/Collector,or Registered Texas Collector unless he is an active and certified registrant with the
department and performing official duties as a property tax appraiser,assessor/collector,or collector.
94.80.Fees. (New rule effective January 18, 2010, 35 TexReg 367; amended effective March 1, 2012 37
TexReg 1325; amended effective January 1, 2014, 38 TexReg 9527)
(a)Application fees.
(1)Appraiser--$100
(2)Collector-4100
(3)Assessor/Collector--$100
(b)Renewal fees.
(1)Appraiser--$55 for registrations expiring before February 1, 2014; $45 for registrations
expiring on or after February 1, 2014
(2)Collector--$55 for registrations expiring before February 1,2014; $45 for registrations
expiring on or after February 1,2014
(3)Assessor/Collector--$55 for registrations expiring before February 1,2014; $45 for
registrations expiring on or after February 1,2014
(c) 'Break in service'credit application fee-475
(d)One-Year Extension application fee-425
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(e) Change from inactive status to active status--$25
(f)Late Renewal Fees. Late renewal fees for licenses issued under this chapter are provided under
§60..83 of this title(relating to Late Renewal Fees).
(g)Revised/Duplicate License/Certificate/Permit/Registration--$25
(h)All fees are non-refundable, except as otherwise provided by law.
94.90. Sanctions and Administrative Penalties. (New rule effective January 18, 2010, 35 TexReg 367)
A person who violates the Texas Occupations Code, Chapter 1151,a rule,or an order of the executive
director or commission relating to Texas Occupations Code, Chapter 1151,will be subject to
administrative sanctions and/or administrative penalties under Texas Occupations Code, Chapters 51 and
1151 and applicable agency rules.
94.91.Enforcement Authority. (New rule effective January 18, 2010, 35 TexReg 367)
The enforcement authority granted under Texas Occupations Code, Chapters 51 and 1151 and any
associated rules may be used to enforce Texas Occupations Code, Chapter 1151 and this chapter.
94.100. Code of Ethics. (New rule effective January 18, 2010, 35 TexReg 367,• amended effective
October 15, 2010, 35 TexReg 9083)
Registrants must:
(1)be guided by the principle that property taxation should be fair and uniform, and apply all
laws,rules,methods, and procedures, in a uniform manner,to all taxpayers;
(2)not accept or solicit any gift, favor, or service that might reasonably tend to influence the
registrant in the discharge of official duties,with the following exceptions:
(A)the benefit is used solely to defray the expenses that accrue in the performance of
duties or activities in connection with the office which are nonreimbursable by the state
or political subdivision;
(B) a political contribution as defined by Title 15 of the Election Code; or
(C) an item with a value of less than$50, excluding cash or a negotiable instrument;
39
(3)not use information received in connection with the duties of an appraiser,assessor, or
collector for their own purposes,unless such information can be known by ordinary means to
any ordinary citizen;
(4)not engage in an official act that is dishonest,misleading, fraudulent, deceptive, or in
violation of law;
(5)not conduct their professional duties in a manner that could reasonably be expected to
create the appearance of impropriety;
(6)not accept an appraisal,assessment, or collection related assignment that can reasonably
be construed as being in conflict with the registrant's responsibility to their jurisdiction,
employer, or client, or in which the registrant has an unrevealed personal interest or bias; and
(7)not accept an assignment or responsibility in which the registrant has a personal interest
without full disclosure of that interest.
1.06 Notice of Appraised Value
The Legislature requires the chief appraiser to deliver,by April 1 or as soon thereafter as practicable if the
property is a residence homestead or by May 1 or as soon thereafter as practicable for any other property,
a written notice of appraised value to the property owner. Appraisal districts are required to mail a notice
if:
• The appraised value of the property is greater than the preceding year.
• The appraised value of the property is greater than the value the property owner rendered
• The property was not on the appraisal roll in the preceding year.
• The ownership of the property has changed from the preceding year.
Denton Central Appraisal District(DCAD)has chosen to mail appraisal notices to every property owner
every year.
Appraisal notices will contain the following information:
• A list of the taxing unites in which the property is taxable.
• The appraised value of the property in the preceding year
• The taxable value of the property in the preceding year for each taxing jurisdiction
• The appraiser value of the property for the current year
• Any exemptions applied to the property,must show the type and amount of each
exemption
• An estimate of the taxes using the current appraised value and the preceding year tax
rates.
40
The notice of appraised value services to notify the property owner of an estimate of market value,the
exemption applied to the property, and any agricultural use applied. It also services to notify the owner of
• The current mailing address the district has
• returned appraisal notices are worked to find the correct address
• If the correct mailing address is not found the account is coded as undeliverable.
This helps the staff when the property owner states at a later date that they did
not receive the notice.
• The identification of the property;the situs address,the legal description,the property
account number.
• The taxpayer's rights to appeal the value
• DCAD includes in the mailing information on the appeals procedures and frequently
asked questions.
• The inclusion of property on the appraisal roll
• To review for equitable appraisal
• The qualification for an agricultural use appraisal
• Any action taken by the Chief Appraiser and Appraisal District that affected the value
This starts the informal process of reviewing the information with the property owner. Taxpayers have
until May 315t or 30 days from the date the notice was delivered to the post office to either file a protest or
come in to speak with an appraiser. Protest can be made in person,mail, email or fax. Informal reviews
of property values over the phone are limited to taxpayers who are unable to come in due to some type of
disability.
During the 30-day protest period appraisers are available to talk to owners/agents. If the appraiser and
owner/agent agree on the value of a property,the owner/agent and appraiser will sign a form titled
"Agreement to Establish Property Values". This agreement is binding between the two parties only for
the current year. If the appraiser and the owner/agent cannot agree the owner/agent must complete the
form"Notice of Protest"and a hearing is scheduled before the Appraisal Review Board(ARB). The
owner/agent has the right to 15 days' notice before the ARB hears the protest to develop the information
to present to the ARB that would help their case. However, if the owner/agent wishes to waive the 15-
day,they may do so by signing a waiver.
When the property has been scheduled with the ARB the property owner/agent is given a form titled
"Information for Property Owners from the Chief Appraiser". This document tells the owner/agent of
their right to inspect and obtain copies of the DCAD value schedules, formula, comparable sales and any
other information that the district plans to use at the hearing.
41
This is NOT Tax 2018 Notice Of Appraised Value Do Nor Pay From
Statementt This Notice
Property ID: Property ID#
DENTON CENTRAL APPRAISAL DISTRICT Ownership%:100,00
3911 MORSE STREET Geo ID:SD3887A- -0000
PO BOX 50747 Le
Legal DENTON,TX 76206 Legal Description
Phone: 940-349-3800 Fax: 940-349-3985
DATE OF NOTICE:April 18,2018 LegalAcres:0.16E3
sdus: Address of Property
Appraiser:
Owner ID:411840
Owner Name
Mailing Address
Dear Property Owner,
We have appraised the property listed above for the tax year 2018. As of January 1,our appraisal is outlined below:
Appraisallnformation Last Year MIT Proposed
Struchre;ImprovementMarket'.alue 220.828 251,278
Market Value of Non Ag?xnber Land 63.450 63,450
Market Value of Ag?imber Land 0 0
Market Value of Personal Property.-Minerals 0 0
Total Market Value 294,278 324,728
Productivity Value of AWTimber Land D 0
Appraised`slue 284.278 312.708
Homestead Cap Value excluding Non-Homesite Value i.e.Ad,Commercial; 2b4,278 312,706
Exem ptiors H S H S
2017 2017 2018 2018 2018
Exemption Taxable Taxing Unit Proposed Exemption Taxabb Tax Rate Estimated Freeze Year and
Amount Value I I Appraised Value Amoutl Value Taxes TaxCeiiry:
5,0D0 279,278 DENTON CITY OF 312.705 5.ODD 307.705 0.637856 1.952.72
0 294,278 DENTON COUNTY 312.705 0 312.705 0.237812 743.65
25,000 259.278 DENTON ISD 312,705 25,000 287,705 1.540D00 4,430.67
Do NOT Pay From This Notice Total Estimated Tax: $7,137.04
The difference terweer the 2013 appraised value and the 2018 appraised value is 28.15%. This percert3ge rformation is required by Tax Cod-_-n-,r 2`.'3fc-",.
The Texas Legislature does nor set the amount of your local tares. Yourproperry tax burden is decided by your locally elected officials,and all inquires
concerning your taxes should be directed to those officials.
'If you qualified your home for a 55 and older or disabled person homestead exemption for school taxes,the school taxes on that home can t increase as long as you own and
live in that home. The tax ceiling is the amount you pay in that year that you qualified for the 55 or oker or disabled person exemption. The school taxes on your home
may not go above the amount of the ceiling,unless you improve the horse(other than normal repairs or maintenance).
The governing body of each taxing unit decides whether or rat taxes on the property will increase.The appraisal district only determines the value of the property.
To five a protest,complete the notice of protest form following the instructions included in the form and no later than the deadline bekrw,mail or deliver the form to the
appraisal review board at the following address: 3911 MORSE ST.DENTON.TX 762.08
Deadline for filing a protest: May 18.2018
Location of hearings: 3911 MORSE ST.DENTON.TX 7WW
ARB will begin hearings: May 22.2018
Enclosed are copies of the following documents published by the Texas Comptroller of Public Accounts: (1)Property Tax Remedies:and(2)Notice of Protest.
If you have any questions or need more information,please contact the appraisal district office at 9403493800 or at the address shown above.
Sincerely,
Chief Appraiser
42
Texas Comptroller of Pubbc Accounts
Property Appraisal — Notice of Protest
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FLUNG DEAMMES:The typical doealrlo for filing a r%A"A lmncdst m midnight gtar 1<<
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• n,e ptnaaaiI cryicents a Cho r n Pio Ipie or ago ailtural aper-spars rw timbedand
• the apPta"dnvrtct or the ARB was requirtd try law W trend Pie pr*mwty owno a rla6m alxiul a pivver-y and dd rutt,
• the ARB made a Change to site ar4KWS l recofft thel adveney SPIK s the proparfy osyner and the prov". Dwner r",.ea node,A she ct4n" or
• m catan hretod Ciramatercas the impart.owner had good cAusv for nasttAig tots p sow tblg doedmo.
Conrad rim AFW ko the county N wet-h rtv ptoprwly o WCAUd for e10 SOK411C proles+I"load-W.
TYPES Of PROTTST HEARINGS,Utrtet Tax Gdde Section A IrAS,a pmpony avow may appw or p4mKipiam in ev ARB poorest hearing m one of tttvw
Ha/s r Cantu at toe heanng ty miplarte coresron0e eeq:or by wrrpon affie6va s.aninvoiss.
6 VVENCE FOR HEARINGS:A pe•wi swum eewp in on ARB twarwig W lsleeroov cvminrenOe can or try wwovir,avir%rvit adr"Mason mist%,Berta
"Amice ffm a wrlPon o"Idavit bdr svW to Pie ARB- In lore nrwrwig oayrh;.A cnmpioleil and signed From. 3 Aeg erty Owners Aettlrril of
Evam,oe to ere Appraisal KeAew Bowe may be used as the ae da/a to ntbmut evideric*beArr Pie AAB nea M E.ldence maV be submfed icy err.
heenng type otwev ri paper or on a vnall cortabO ekrl antic drt•ce(such es a CD.USB tgv drew or thump dnvei wtwch will to Moor by the AAB.Do not
bung wtdwicv on a sonars phone,Ttv ARW*neA"N ptr oedorol tei;snfing all 1hr mgiwtsrtords to properly w t mil ottdwicr tin a small r+Dnacio electronic
devices w-.te1 be nervier.
NONCE_Trio Comigim ller s olece may not edvirr a pr owrty orwwi A propoiry owner's ogwil the cowl eppra,acv or any appraisal dshid orkkwe an
a matter wa!out CorWroNrr s toVisv bows rt tho wb1oc d a t>.ebbr to ttta ARB.C mA1 Tam Codm Chapw 41 cw tort APO hearing p•ooeO.rws for more
mltvmr'rre�
7.t.%iM ta.-,marr;1 Inr olw-ihn p,jWV s riled,
TZ am
Homer 4 rrl,x,e.tr Cemree i.Lessee
tAeoro Ass»•.cra,stw.ZIP Cod.
PON-mly PW V IW"xtat jams cam a^e ariewt Lri*1 Aloaes•
'Ar.tvmat emroee of a tso 00 of we PAIC'r.41A to rotvo f-gil maser 00woremV rna s«vien• Z-$37.MO.".by w4kdnp 0%&men aalrw m Nis Vtn.ow on
enittnrtolr fsrtsrMtO b S toieeee sell ov r1LAn'Ind tier eton ArA
It 1
cstrimmeellar lei Mgovlaartaprowtty111
43
Texas COMPtrOUCT of Public Accounts
SECTIONDoscitpoon
Provide Hie descnpbve infonnetion requested below,
PhysiculAddresn.Csv,State-ZI°Code(W dMeftW Mmn$dW*V!
1 no Mrset address rowde lool after) torn
Appraisal DWnd Accow l Number(N krmmyrt
VoMe Hrom Maus,Undsl m-4 Identtha■llm humor
VW• ■ ■
To preserve your right to present each reason rot your protest to the ARB according to law,be sure to select all boxes that apply.
For example,it you select the first box vxJicating an rrc>rrecl apprauec7(market)valve for your property.you a e representing that ore value as Incorrect—
usually that the value should be lowered.
11 you also want w prowsl Irsal your propvly is nor appraised at the same lovel ss a rrWe!mi%aR"sanr,le of companWlc Dfopertw_-appim latel,aoltsted
for condition size,location and other factors,you must also select the box indicating Hie value is unequal oomparod with other properties.Your property
may be appraised at its marftet value.but be unequally appra■sed.
Failure to select the box trial corrasporxJs to earn reason for your prow--it may rfesult in your Inap-lity to protest ar.rssue Mar W"want to pursue,
Incorrect appraeie i(market)value.
rflg-u$e,dpetrrprlCd n.�niheJ sfxrr+l ttrf:ntsnl wns tztntrc! nvrJlMd 6r ctrncellrvl.
Vnl,m Is unequal compared with olhur ptulm'11(m I Cnange in use of land appraraed as ag-use,oven pace or irmbeirlarte.
�I Rcperty ehwld net be lazed err I InDon-ect appraised or market value of land wxler metros appraisal
.*a rA rs■etp arw'1 far atpuse.openapacm ar olhur wecLW appraisal.
Ci Property a not kxawd n this appraisal dslrid or otherwise shoub not
be included cn the appraisal disktcfa record. Owner's name is Incorrect.
C1 Faikae to send required notice. (Property comcripdon x nommct.
Ekemptro)*,is amled rnormh%d fir cancalletl. QHI@P
Rtrvide facts that may help resolve this protest,
What do you think your praWty s value is?iOprrorrall 5_
t Ix rim•rr dof motion,vhh wt webute..tam ptroller.texas.gootaxes,property4ax
4t tu•nt Irut
44
Texas Comptroller of Public Accounts
SECTION
Innrcutu below how you mtolid to appear or patittapate in a prolr_rsl he-firing wttoduled tut tiro property that.s the s~of this protest.A property owner
does not waive hso right to appear in person at a protest hearing by submitting an aftwit to the ARB or by electing to appear by telephone conlerenotr call.
I intend to appear in the ARE;rreanng scheduled for my protest in the tollowtng manner(Greck only urte box):
In person
By telapho,n nonlrsnnce cal and will mahru nvclsl"within Y%O"w alli ArOwwrad In the AR@ beiprre thn hewng trgirn••Rrmr.w Inn AFM'x hnarrrq rxvr*dt rw::
to,co�nly-;pectic telephone oonlwenoe At procedures.
Telerptwns rimer for the ARB to cornea you.,
(Onnw)Vaprlane MWUw VoM AnW Cadol
Or^wnttan allidaw.94wrrend with RVtd•nrq and*Iivwc)d to Ihn ARB bebrs Ow haenrttl begin.
"if you dexlet later to appear by tetenhone con(tranee cal.yor must pravld r written notice to the ARB or laa.^..10 days behre Ina nearing date.You are respurside Ia providniji
access to ite call to any oersoWsl yuu wen to iwile,IL.partldpets rr,the tresrinq.
SFC-nON
II a protest goes to a hewing.the ARB autcrmabcally,sends each party a copy of the ARB's hearing procedures
I Want the ARB to Sono me a wily or its hearng pr000dures. Yes No
•
cr:i
nt*
re
Prnr Name of Parson Fling ROM
sign
hstrr
9igrtalwe ul Peraw Firny nrorest late
i or mcoe Information,vwr out websitc comps ro0er.texas.gov)'taxes/property-tax
Sri �
45
SUBSECTION 2. REAL PROPERTY APPRAISAL
Part A. General Policies and Procedures
2.01 Introduction
There are three basic approaches available to the appraiser for the valuation of real property. Ideally, all
three approaches are used to establish a final estimate of market value. Quite often,though, one or more
of the approaches will be inappropriate to the property being appraised. Therefore,it is essential that the
appraiser have a thorough working knowledge of each approach, and when to make use of it.
The Commercial,Land,and Residential Departments appraise many different types of property, so an
appraiser's judgment is a very important factor in the mass appraisal process.
Part B. Commercial Property
2.02 Introduction
A. Definition of Appraisal Responsibility
The Commercial Department of the Denton Central Appraisal District(DCAD)is responsible for
developing fair and uniform market values for all multi-family, commercial, industrial properties,as well
as commercially zoned land inside city limits and non-subdivided rural land outside city limits within
district boundaries.
B. Legal and Statutory Requirements
The DCAD adheres to the policies and regulations of the Texas Property Tax Code(TPTC). The
provisions of the TPTC and relevant legislative measures involving appraisal administration and
procedures control the work of the appraisal district. The district is responsible for estimating the market
value of each property, as of January 1, for ad valorem tax purposes. The district is required to
periodically reappraise all real property at least once every three years. DCAD has adopted a reappraisal
plan on an annual cycle.
C.Administrative Requirements
An appraisal management policy should reflect regulatory obligations,mandate due diligence, ensure
conformance to professional standards,generate current and meaningful valuations, and establish criteria
for a thorough review process. DCAD subscribes to the standards of the International Association of
Assessing Officers (IAAO)regarding its appraisal practices and procedures. DCAD also subscribes to
46
the standards promulgated by the Appraisal Foundation known as the Uniform Standards of Professional
Appraisal Practice(USPAP). A current copy of the USPAP manual is on file at DCAD. The
Commercial Department submits an annual budget to the Deputy Chief Appraiser. The department is
responsible for completing mass appraisal assignments in a timely manner, within the cost constraints of
said budget.
D. Appraisal Resources
Personnel-The Commercial Department consists of an appraisal manager,two supervisors, four field
appraisers, and two administrative support positions. The appraisal manager reports to the Deputy Chief
Appraiser.
Data-The data used by the Commercial Department includes verified sales of vacant land and improved
properties and the pertinent data obtained from each(sales price levels, capitalization rates,income
multipliers, etc.). Other data used by the department includes actual income and expense data(typically
obtained through the hearings process), actual contract rental data, leasing information(commissions,
tenant finish,length of terms, etc.), and actual occupancy rates. In addition to the actual data obtained
from specific properties,market data publications are also reviewed to provide additional support for
local and regional market trends, such as:
• Institute of Real Estate Management(IREM)—Provides revenue and expense analysis for
shopping centers, offices, conventional and federally assisted apartments.
• Urban Land Institute (ULI)—Provides revenue and expense analysis for apartments and
shopping centers.
• Source Strategies Inc.—Provides revenue and occupancy analysis for hotels and motels.
• Delta Associates—Provides revenue and occupancy analysis for industrial and offices.
• NAI Global Market Report—Provides revenue and occupancy analysis for retail, industrial and
offices.
• PKF Hospitality Research—Provides revenue, expense, and profit analysis for hotels and motels.
• COSTAR Group—Provides sales information as well as revenue and occupancy analysis for
industrial,flex, retail, offices and apartments.
• ALN Apartment Data—Provides revenue and occupancy analysis for apartments.
• Integra Realty Resources—Provides capitalization rate analysis for retail, industrial, hotel/motel,
offices and apartments.
• Realty Rates, Inc. - Provides capitalization rate analysis for retail, industrial, offices and
apartments.
• Real Estate Research Corp. - Provides capitalization rate analysis for retail, industrial,
hotel/motel, offices and apartments.
• PriceWaterhouseCoopers— "Korpacz Real Estate Investor Survey"provides capitalization rate
analysis for retail, industrial, hotel/motel, offices and apartments.
Information Systems -The mainframe systems are augmented by the databases that reside as various
applications on the DCAD Local Area Network(LAN). DCAD offers a variety of systems for providing
property owners and public entities with information services. The Appraisal Support Department fields
many of the public's questions or redirects them to the proper department. Computer terminal stations are
47
located in the customer service area for the public's use. Access to the district's appraisal data is also
available through DCAD's website: www.dentoncad.com.
2.03 Valuation Approach
A. Area Analysis
Data on regional economic forces such as demographic patterns,regional location factors,employment
and income patterns,general trends in real property prices and rents,interest rate trends, availability of
vacant land,and construction trends and costs are collected from private vendors and public sources.
Information is gleaned from real estate publications and sources such as the Multiple Listing Services,
(Dallas and Denton Board of Realtors), "The Roddy Report," "The Dallas Business Journal,"Marshall
& Swift,IAAO, CoStar Group and applicable sources found on the Internet. Monitoring these sources
provide employees a current economic outlook on Denton County's real estate market. The Commercial
Department uses the above-mentioned sources in its analysis of defined neighborhood and geographical
areas.
B.Neighborhood Anal
The neighborhood is comprised of the land area and commercially classed properties located within the
boundary of a taxing jurisdiction. The current commercial neighborhoods(market areas)are:
CODE DESCRIPTION
CO2 Cities of Carrollton and Dallas
CO3 City of The Colony
S05 Denton ISD and Argyle ISD
S08 Lake Dallas ISD
S09 Cities of Lewisville,Highland Village, and Flower Mound
S 10 Little Elm ISD,Frisco ISD, Celina ISD, and Prosper ISD
S 11 Northwest ISD, and Ponder ISD
S14 Sanger ISD,Pilot Point ISD,Aubrey ISD, and Krum ISD
These areas consist of a wide variety of property types including multi-family, commercial and industrial.
Neighborhood analysis involves the examination of how physical,economic, governmental and social
forces and other influences affect property values. The effects of these forces are also used to identify,
classify, and organize comparable properties into smaller,manageable subsets of the universe of
properties known as neighborhoods.
48
Neighborhoods are defined by each of the improved property use types(multi-family, office, flex,
warehouse/industrial, general retail, shopping center, sports and entertainment,hospitality,health care,
and specialty)based upon an analysis of similar economic or market forces. These include but are not
limited to similarities of rental rates,class of construction, date of construction, overall market activity or
other pertinent influences. Sales and income information are gathered on each neighborhood area and
used to formulate overall appraised values for that neighborhood. The current commercial property use
types are:
CODE DESCRIPTION CODE DESCRIPTION
Multi Family Shopping Center
M17001 Apartments SC001 Community Center
M17002 Apts.—Under 75 Units SCO05 Department Store
M17005 Apts.—Dormitory SC010 Discount Store
M17006 Apts.—Efficiencies SCO15 Lifestyle Center
MF007 Apts.—Frat House SCO20 Neighborhood Center
MFO10 Apts.—Senior SCO25 Outlet Center
MFO15 Apts.—Subsidized SC030 Power Center
MFO16 Apartments w/Retail SC035 Regional Mall
MF020 Mobile Home Park SC040 Specialty/Entertainment
MF025 Plex(2—7 units) SC045 Strip Center
Office SC050 Super Regional Mall
017001 Condo SC055 Town Center
OF002 Converted House Sports&Entertainment
OF005 Corporate Campus SE001 Amusement Park
OF010 Medical SE005 Baseball Field
OF015 Multi-Tenant SE010 Bowling Alley
OF020 Single Tenant SE015 Casino
Flex SE020 Golf Course
FL001 Flex Distribution SE025 Golf Driving Range
FL005 Flex Manufacturing SE030 Health Club
FL020 Flex Warehouse SE035 Horse Stables
FL025 U.S.Post Office SE036 Indoor Sports Facility
Warehouse/Industrial SE040 Movie Theater
WH001 Airplane Hangar SE045 Race Track
WH005 Auto Salvage Facility
CODE DESCRIPTION CODE DESCRIPTION
WHO10 Cement Plant SE050 Skating Rink
WHO15 Distribution SE055 Swimming Pool
WH020 Food Processing SE060 Theater/Concert Hall
WH025 Industrial Manufacturing Hospitality
WH030 Railway Yard HS001 Hotel-LS
WH035 Refrigeration HS002 Hotel-Budget
WH040 Self Storage HS005 Hotel Casino
WH045 Service HS010 Motel
WH050 Truck Terminal HS015 Motel—Suites
WH055 Utility Sub Station HS020 Hotel Convention
WH060 Warehouse HS025 Hotel Resort
General Retail HS030 Hotel Casino
RE001 Auto Dealership Health Care
RE005 Auto Repair HC001 Assisted Living
49
RE006 Auto Oil&Lube Center HC005 Clinic
RE010 Bank HCO10 Cont.Care Retirement Community
RE015 Bar HC015 Hospital
RE020 Car Wash HCO20 Independent Living
RE025 Convenience Store HCO25 Rehabilitation Center
RE030 Day Care Center HC030 Skilled Nursing Facility
RE035 Drug Store HC035 Surgery Center-Outpatient
RE040 Fast Food Specialty
RE045 Funeral Home SP001 Cemetery/Mausoleum
RE050 Garden Center SP005 Lodge/Meeting Hall
RE055 General Freestanding SPO10 Marina
RE060 Parking Garage SP015 Movie/Radio/TV Studio
RE065 Parking Lot SP030 Private School
RE070 Restaurant
RE075 Service Station
RE080 Storefront Retail/Office
RE085 Storefront—Historic Downtown
RE090 Supermarket
RE095 Truck Stop
RE100 Veterinarian/Kennel
C. Highest and Best Use Analysis
The highest and best use of property is the reasonable and probable use that supports the highest present
value as of the date of the appraisal. The highest and best use must be physically possible,legal,
financially feasible, and maximally productive. For improved properties,highest and best use is
evaluated as improved and as if the site were still vacant. This assists in determining if the existing
improvements have a transitional use,interim use,non-conforming use,multiple uses, speculative use,
excess land, or a different optimum use if the site were vacant. Improved properties reflect a wide variety
of highest and best uses that include,but are not limited to: office,retail,multi-family,warehouse, light
industrial, special purpose, or interim uses. In many instances,the property's current use is the same as
its highest and best use. This analysis insures that an accurate estimate of market value is derived.
2.04 Data Collection/Validation
A. Data Collection Manuals
Field data collection requires organization,planning, and supervision of the field staff. Data collection
procedures have been established for land,residential, commercial,and personal property. The
"Appraisal"(cost)manual and"Property Tax Appraisal and Data Collection"(procedure)manual is
published and distributed to all appraisers involved in the appraisal and valuation of commercial
properties. Field appraisers use these manuals during their initial training and as a guide in the field
inspection of properties. Both manuals are reviewed and revised on an annual basis to meet the changing
requirements of field data collection.
50
B. Sources of Data
The district's property characteristic data was originally obtained from the ISD's,Denton County Tax
Office as well as the surrounding cities. And where absent, collected through a massive field data
collection effort coordinated by the district over a period of time. On an annual basis,building permits
and blueprints (obtained from taxing jurisdictions)area principal source of data. New commercial
starts,remodeling, additions and other permit-required improvements are also discovered through field
inspection,which frequently results in the discovery of new construction not found through the permit
process. Tax assessors, city and local newspapers, internet sources (such as CoStar,Axiometrics, and
local websites), and the public often provide information to the district regarding new construction,
market patterns, and other useful facts related to property valuation. Renditions (reports filed by the
property owner)describe the property, list any improvements, identify its location, and sometimes
provide an estimate of value.Aerial photographs are also sometimes used to find hard to locate
improvements.
C. Data Collection Procedures
The appraisal support staff processes and enters building permit data into the PACS Appraisal System.
When building blueprints are attached to the permit,the appraisal support staff enters the building
dimensions and characteristic data into PACS.
The field appraiser is responsible for the collection of information used in the appraisal of property. The
physical characteristics of a property currently shown on the record will be provided to the appraiser at
the time of inspection in the form of a PACS appraisal card. Care must be taken to ensure the accuracy of
this information. Although DCAD will provide all available information regarding cost,market, and
income,the appraiser must take every opportunity to discover this information while inspecting the
property. Upon completion of the field inspection,the updated information on the appraisal cards is
entered into PACS by the appraisal support staff. The appraisers are required to check the data entry on
each property to ensure that the new information was entered correctly. The information collected by the
appraiser and entered into the PACS appraisal system serves as the basis for the valuation of real
property.
In addition to field inspections, DCAD utilizes the Pictometry Sketch Verification program,which is a
computer program that compares the PACS building sketch to the most recent aerial photograph of the
building. Appraiser's field inspects any discrepancies and makes corrections as necessary.
The DCAD boundaries are divided into geographic areas with each appraiser assigned an area for which
they are responsible for data collection. The commercial department conducts periodic meetings where
each appraiser gives a verbal report of their work progress. Additionally, each appraiser's work is
reviewed by the appraisal supervisor before it is given to appraisal support for data entry. These
procedures are an important tool in analyzing future departmental staffing needs,as well as showing each
individual appraiser's progress and error rate. While production standards are established and upheld for
the various field activities,quality of data is emphasized as the goal and responsibility of each appraiser.
New appraisers are trained in the specifics of data collection set forth in the appraisal manual as
procedures to follow. Experienced appraisers are routinely brought up to date on changes in procedures
prior to major field projects such as new construction, sales validation or data review. The commercial
department manager routinely reviews the work being performed by all the field appraisers. The
51
department manager is also charged with the responsibility of ensuring that appraisers follow listing
procedures, identify training issues and provide uniform training throughout the appraisal staff.
2.05 Class System
A class system for commercial properties has been developed to help ensure appraisal uniformity. The
commercial class system currently consists of 106 classes. These classes are based on occupancy and are
grouped together in clusters of like occupancy. Within each occupancy group, classes are based on levels
of quality, such as excellent,good, average, and low cost. When classing a particular property,the
appraiser will choose an occupancy for which the building was originally designed. If the current
occupancy is different from that for which the building was originally designed,the appraiser must take
care in measuring any functional obsolescence experienced by the structure.
The different classes will reference the computer to cost tables developed from the Core Logic Valuation
Service,which is an appraisal guide for developing replacement costs for a wide range of construction
classes and types of occupancies. Core Logic Valuation Service software utilizes the comparative unit
method to derive a cost per unit for the structure being appraised. Typical building specifications are
developed for each occupancy group,which are used to determine the base cost of benchmark structures.
Once the benchmark base costs are in place, construction costs for each occupancy class at various size
increments are developed. Adjustments for variations from base cost specifications are also developed
for each class. And finally, local modifiers are used to make the cost data applicable to Denton County.
The DCAD also collects actual cost data from local developers and property owners. Whenever possible,
actual costs are compared to Marshall Valuation Service costs. If there are inconsistencies between the
two costs, adjustments will be made to the appropriate DCAD classes. Actual local costs are given more
weight than Core Logic Valuation costs in these circumstances. If, in the appraiser's judgment,the cost
tables do not fit the property being appraised,but that property does fit into a class,the appraiser should
class the property by its occupancy. The computer system will allow the appraiser to override the tables
and enter the cost value he deems correct. All commercial class costs are updated annually,based on data
that is published closest to January 1.
Classes cannot be established for every commercial property within Denton County. A small percentage
of the properties will require special pricing by the appraiser. This can be accomplished either by use of
the Core Logic Valuation Service or flat pricing. Each of these two methods requires that the appraiser
utilize his or her best judgment on items that are too infrequent or unusual to fit efficiently into the
present class system. A listing and description of all commercial classes is given in the cost approach
section of this manual.
52
2.06 Valuation and Statistical Analysis (model calibration)
A. Land Valuation
The commercial department is responsible for appraising commercially zoned land inside city limits and
non-subdivided rural land outside city limits within district boundaries. Land and improvements are
valued separately so that the trends and factors affecting each can be studied. The first step in land
valuation is market analysis,which consists of sales stratification,determination of units of comparison,
and data analysis.
Stratification is accomplished by grouping sales into homogeneous geographic areas (school district, city,
etc.)where there are similar market influences,variations in zoning, and probable uses. These grouping
criteria will ensure that land values will reflect market data for parcels with similar or competitive uses in
the same area. Land is analyzed and valued according to common units of comparison. The units chosen
conform to the basis upon which land is sold in the market. Commercially zoned land is valued by the
square foot,while rural land is valued by the acre. Once the sales have been grouped into geographic
areas,the appraiser then produces GIS maps showing the sale price, sale price per unit, sale date, and
property ID number. The sold parcels as well as the commercial and rural parcels to be valued are color
coded for easy identification. Once the sales have been plotted on a map,the appraiser can more easily
determine patterns and trends in land values.
The primary method of rural and commercial land valuation is the comparative unit method. The
appraiser determines the average or typical per unit value for each stratum of land by carefully
considering the available data on the sales maps and making an informed judgment. When there are
insufficient sales within strata but sales prices per unit are similar between adjoining strata,the appraiser
can combine strata in order to develop per unit values.
Once comparative unit values have been determined for an area,those values must then be refined by
applying site adjustments at the individual parcel level. Site characteristics often requiring adjustment
include topography,traffic flow,limited access, flooding susceptibility, drainage, and irregular shape.
Site adjustments are applied only to those parcels in the neighborhood or stratum that are affected. The
adjustments are made as a percentage adjustment to the market value(ex: $50,000 x .85 =$42,500). The
appraisers use their informed judgment to determine the adjustment percentage.
When there are too few land sales to conduct the sales comparison approach,the appraiser should employ
either the abstraction or allocation method. In the abstraction method, improvement values obtained from
the cost model are subtracted from the sale price of the improved parcel to yield the land value estimate.
The reliability of this method depends on the accuracy of the improvement values used in the analysis.
The use of this method should be limited to parcels with relatively new buildings, so that the replacement
cost and depreciation are more easily estimated. The allocation method is also known as the land ratio
method. When there are insufficient vacant land sales in a given market area,the appraiser looks at
comparable areas with sufficient land sales, determines the typical ratio of land value to total value, and
then applies the ratio to parcels in the subject area. This method is particularly useful in older
neighborhoods that are almost totally built out and therefore have very few,if any vacant land sales.
53
Appraisers are expected to review land values in their assigned areas on an annual basis in order to keep
pace with market conditions.
B. Cost Approach
The cost approach to estimating value is the most widely applicable approach used for commercial
properties because it can be applied to all improved properties. However,the appraiser must always be
conscious of the difference between cost and value. Because of this difference,the appraiser must
exercise judgment when measuring applicable depreciation.
For the cost approach, a class system based on occupancy and quality has been programmed into the
computer. The cost figures for each class were taken from the Core Logic Valuation manual,with
modifications to reflect the Denton County market. A description of each class, and the quality levels in
which that class can be found, is included at the end of this section. All DCAD commercial cost
schedules are evaluated and updated on an annual basis by the department manager.
The uniqueness of some properties will necessitate use of the unit-in-place or segregated cost method.
The appraiser will manually make the calculations using the Core Logic Valuation Manual and enter the
figures directly into the computer. If the appraiser can get actual costs on new construction,he can use
those costs in the cost approach. Care must be taken to ensure that any costs provided represent actual
total costs. Cost can be defined as the total expenditure necessary to construct an improvement and place
it in the hands of the consumer. The appraiser may use actual new construction costs,as long as those
figures represent actual total costs. In other words,the appraiser must make sure all indirect costs, as well
as direct costs,are included. This will require a detailed breakdown of the submitted cost information.
Summarized costs provided by tax consultants or taxpayers should be avoided unless substantial support
for those figures can be provided.
The costs included in the Core Logic Valuation Manual are the actual costs to the owner and include
direct costs(materials, equipment rentals,utilities, labor, and supervision), as well as indirect costs (plans
and plan check, site preparation,architectural and engineering fees,building permits,title and legal fees,
and interest and fees on construction loans). Indirect costs also include the contractor's profit and
overhead,which includes fire, liability and unemployment insurance, and workmen's compensation.
When classing a building,the appraiser must first ascertain the quality of the building because the
majority of DCAD classes are based on a single level of quality. The quality levels used in the DCAD
class system are excellent, good,average, and low cost. Construction quality can be difficult to determine
in buildings where the importance of appearance and amenities is equal to or greater than the importance
of pure utility. It is usually true that a well-framed building is a well-finished building. And it is also true
that if a builder cuts corners on framing,he will probably also cut corners on finish-out and mechanical
equipment. If an appraiser is having difficulty in determining the quality level of a building,he should
refer to the DCAD and/or Core Logic Valuation Manual for guidance.
The final step in the cost approach is to establish the level of depreciation experienced by the
improvement. Depreciation occurs in three forms: physical, functional, and economic.
Physical deterioration is the loss in value due to the wear and tear of the property. The DCAD utilizes the
Core Logic Valuation Service commercial depreciation tables to measure physical deterioration. These
54
tables are a modified version of the overall Age-Life method. Whereas the Age-Life method assumes that
a building depreciates by a constant percentage over its economic life,the Core Logic Valuation tables
recognize that a building is in the prime of life up until mid-life. This non-linear approach accounts for a
slower depreciation rate in the early years as compared to the later years when diminishing serviceability
and higher maintenance can accelerate depreciation. DCAD depreciation tables are divided into five year
increments from twenty year life to seventy year life. The particular table that is used is determined by
the type of construction and usage of the building. As part of the physical depreciation analysis,the
appraiser should consider the"effective age"of the building. The effective age of a building is its actual
age,less the age which has been taken off by structural face-lifting or reconstruction,removal of
functional inadequacies,updating of equipment, etc.
Functional obsolescence is the overall usefulness and desirability of a property. Functional obsolescence
is the loss of value in a property improvement due to changes in style,taste,technology,needs, and
demands. It exists where property suffers from poor or inappropriate architecture,poor floor plans,room
sizes, etc. In these instances,buyers perceive a loss in utility,therefore,the price offered is lower due to
reduced demand.
Economic obsolescence(or external obsolescence)is the loss in value caused by outside forces such as in
the highest and best use of a property due to market shifts or governmental actions,restrictions on
income,zoning,neighborhood decline,etc. This can influence both land and improvements.
Field inspection is required for the analysis and measurement of all forms of accrued depreciation. The
appraiser should consider all conditions that diminish utility and estimate their combined effect on market
value. Physical depreciation, functional and economic obsolescence,and effective age are also influenced
by competition and market conditions. The appraiser,therefore, should also analyze the income and sales
of comparable properties when deciding on a measurement of accrued depreciation. All forms of
depreciation are expressed as a percent good.
Once the estimated depreciated improvement value is determined, it is then added to the land value
resulting in an estimated total property value. The cost approach is used as a comparison to the market
schedules.
V=LV+(RCN—D)
(Value=Land Value+(Replacement Cost New—Depreciation)
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COMMERCIAL IMPROVEMENT CLASS DESCRIPTIONS
CLASS 120-140
Apartments(Low Rise)are multi-family residences from one to three stories. Costs include common
areas such as hallways, laundry areas, etc. Each unit will have a kitchen and at least one bathroom.
Generally,the units are intended for rental purposes,but may be sold individually as condominiums.
Good quality apartments will have plaster,paneling, good detailing in molding and trim, and high cost
floor finishes. The structures are commonly solid masonry(Class C)or wood frame(Class D)
construction.
CLASS 120—Low Cost
CLASS 130—Average Quality
CLASS 140—Good Quality
CLASS 141
Apartments (High Rise)are multi-family residences with three or more stories of multiple dwelling units.
The structures can be built of all construction classes. The structures include a lobby area,interior hall
access to dwelling units and some type of stairway for fire exit. Costs include appliances, fireplaces,
balconies, and elevators. This class has three quality levels of average, good,and best.
CLASS 141 —Average, Good, or Best
CLASS 142
Apartments &Retail(Mixed)are generally two to three story structures with retail use on the first level
and one or more residential units on the upper levels. The structures are commonly solid masonry(Class
C)or wood frame (Class D)construction. Costs include fireplaces,balconies,porches, appliances and
elevators. This class has three quality levels of low,average, and good.
CLASS 142—Low,Average, or Good
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CLASS 150-170
Motels are multiple sleeping units from one to three stories,with or without individual kitchen facilities,
and designed for transient occupancy. The structures are commonly solid masonry(Class C)or wood
frame (Class D). Interiors are of plaster or drywall with wall coverings. Paneling and wallpaper are
included in the better qualities in the common areas and sleeping rooms. Price large restaurants and
lounges separately. If,however,the amount of office, lobby, coffee shop and meeting rooms is
proportionate with the number of rooms and overall quality,then these features will be included in the
cost.
CLASS 150—Low Cost
CLASS 160—Average Quality
CLASS 170—Good Quality
CLASS 180-190
Hotels are multiple sleeping units and lobby of three or more stories,without individual kitchen facilities.
The costs include lounges,restaurants,ballrooms and meeting rooms commensurate with the number of
rooms and overall quality of the hotel. Better quality hotels have a large amount of high-cost wall cover
and floor finish in the open and public areas.
CLASS 180—Low cost
CLASS 190—Average Quality
CLASS 191 —Good Quality
CLASS 200-210
Department Stores are one or more stories,typically found in large cities and regional shopping centers,
which handle multiple lines of merchandise, for which they are subdivided into departments. Costs
include suitable office and employee areas,and restroom facilities.
CLASS 200—Average Quality
CLASS 210—Good Quality
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CLASS 220-240
Retail Stores are one or two story buildings designed for retail sales and display, and usually have display
and/or decorative fronts. Included in this occupancy are stores occupied by secondary department stores
with limited merchandise lines, specialty shop and commercial buildings designed for general occupancy.
CLASS 220—Low Cost
CLASS 230—Average Quality
CLASS 240—Good Quality
CLASS 250-270
Supermarkets are large retail food stores,which handle limited lines of other merchandise. The cost
includes built-in refrigerators, cold rooms, and ancillary cooling equipment,which are usually classed as
real estate,but do not include display freezers and coolers or other equipment generally classed as
personal property or trade fixtures.
CLASS 250—Low Cost
CLASS 260—Average Quality
CLASS 270—Good Quality
CLASS 280-300
Discount Stores are of warehouse construction with minimal interior partitioning. Low cost structures are
unfinished shell types with minimum code throughout. Better qualities have partitioned offices and
storage areas. NOTE: The highest quality discount stores should be classed as average quality department
stores.
CLASS 280—Cheap Cost
CLASS 290—Low Cost
CLASS 300—Average Quality
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CLASS 310-332
Shopping Centers are multi-tenant buildings designed for retail sales. Shopping centers provide
neighborhood and community services such as food,drugs,hardware, clothing and personal services
needed for daily living. These structures may or may not have an anchor.
CLASS 310—Low Cost
CLASS 320—Average Quality
CLASS 330—Good Quality
CLASS 331 —Excellent Quality
CLASS 332—Best Quality
CLASS 340-360
Fast Food Restaurants have a limited dining area in relation to the preparation area. These structures
range in size from 1,300 to 4,200 square feet, and the seating area is normally less than 45%of the total
area.
CLASS 340—Low Cost
CLASS 350—Average Quality
CLASS 360—Good Quality
CLASS 370-390
Restaurants are designed for the preparation and sale of food and beverages. These buildings have a full
service commercial kitchen and varied seating capacities. Average quality includes neighborhood
restaurants or coffee shops or a lower priced franchise operation. Good quality includes the typical chain
operation and neighborhood restaurants catering to regional trade.
CLASS 370—Low Cost
CLASS 380—Average Quality
CLASS 390—Good Quality
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CLASS 397-399
Day Care Centers
CLASS 397—Low Cost
CLASS 398—Average Quality
CLASS 399—Good Quality
CLASS 400-432
Office Buildings are designed for commercial occupancy and are normally subdivided as multi-tenant
structures. If part of an office building has some other occupant, such as a bank or retail store on the first
floor,that portion should be classed according to its occupancy.
CLASS 400—Low Cost
CLASS 410—Above Low Cost
CLASS 420—Average Quality
CLASS 430—Good Quality
CLASS 431 —Very Good Quality
CLASS 432—Excellent Quality
CLASS 440-460
Banks are financial structures that include savings and loan and credit union occupancies where the
design is of a bank type. Cost includes vaults, drive up windows,night depositories, and surveillance
systems. Costs do not include banking equipment,vault doors, or safety deposit boxes.
CLASS 440—Low Cost
CLASS 450—Average Quality
CLASS 460—Good Quality
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CLASS 470-480
Nursing Homes (Convalescent Hospitals)are buildings of hospital type construction that give nursing
care. They are designed for bed care and/or hotel and nursing care for ambulatory patients. They have
treatment and therapy rooms, service and administration areas,nurses' stations and signaling systems
commensurate with quality. These facilities do not have equipment for surgical care and treatment.
CLASS 470—Low Cost
CLASS 480—Average Quality
CLASS 490-500
Hospitals are complete health care facilities that typically include a number of different health services
within one building or groups of buildings. These buildings have a large number of partitions with
additional electrical,mechanical, and plumbing needs for this occupancy group. Lower quality hospitals
have a large ward area while higher quality hospitals have a large amount of private rooms. Costs include
fixed equipment,but not equipment classified as personal property.
CLASS 490—Low to Average Quality
CLASS 500—Average to Good Quality
CLASS 510-530
Clinic/Medical Office/Veterinary Clinic buildings are designed for medical or dental services with
examination and outpatient treatment. The cost reflects the additional electrical,mechanical and
plumbing required by this occupancy. These costs are also used for veterinary hospitals,which are
buildings designed for the medical and surgical care and treatment of animals.
CLASS 510—Low Cost
CLASS 520—Average Quality
CLASS 530—Good Quality
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CLASS 540-560
Service Stations (old style)are designed for the sale of gas and service of automobiles. The cost includes
office, service, storage, sales and restroom areas. The cost does not include equipment that is considered
personal property.
CLASS 540—Low Cost
CLASS 550—Average Quality
CLASS 560
Service Station Food Booth
CLASS 560—Low,Average, and Good Quality
CLASS 570-590
Automotive Centers are designed for both sales and service with display rooms, office, storage and repair
commensurate with the quality. The better qualities are a combination retail store and garage.
CLASS 570—Low Cost
CLASS 580—Average Quality
CLASS 590—Good Quality
CLASS 595
Mini-Lube Garages are designed for quick maintenance lube and oil changes and may have drive-thru
bays. The quality levels are low, average, and good.
CLASS 600-611
Automotive Sales and Service buildings contain showroom, office, storage and repair space. The sales
and office space are priced separately from the service area.
CLASS 600&601—Low to Average Quality
CLASS 610&611 —Average to Good Quality
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CLASS 700-710
Shopping are regional shopping centers comprised of major department store anchors, center strip
stores and enclosed mall concourses.
CLASS 700—Average Quality
CLASS 710—Good Quality
CLASS 800-840
Industrial Buildings include those structures designed for manufacturing processes. They have the same
structural shell as warehouses,but with better lighting,plumbing, and an enlarged office space. Each
class differs only in structure and exterior features. Each class also has three quality levels of average,
good,and excellent.
CLASS 800—Class A (Fireproof Structural Steel Frame)
CLASS 810—Class B (Reinforced Concrete Frame)
CLASS 820—Class C (Masonry Bearing Walls, including Tilt-Up)
CLASS 830—Class D or S (Wood or Steel Frame)
CLASS 840—Class P (Wood"Pole"Frame)
CLASS 900-920
Warehouses are structures designed for both storage and distribution, and include an amount of office
space commensurate with the quality of the building(typically 3%to 12%). If,however,the office area
is substantial in size or quality, it may be necessary to price the office area as office and the warehouse
area as warehouse. Each class differs only in structure and exterior features. Each class also has three
quality levels of average, good, and excellent.
CLASS 900—Class A&B (Fireproof Structural Steel Frame and Reinforced Concrete Frame)
CLASS 910—Class C (Masonry Bearing Walls, including Tilt-Up)
CLASS 920—Class D or S (Wood or Steel Frame)
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CLASS 930
Low Cost Storage Warehouses are structures with a light steel frame(Class D"pole"),no insulation,and
typically no office space. The quality levels are low, average, good,and excellent. The low price is used
only for warehouse space,while the other quality levels are used to price only office space.
CLASS 940
Low Cost Storage Warehouses are structures with a light steel frame(Class D"pole"),insulation, and
typically no office space. The quality levels are low, average, good,and excellent. The low price is used
only for warehouse space,while the other quality levels are used to price only office space.
CLASS 950-970
Mini-Warehouses are warehouses subdivided into cubicles of generally small size. They are primarily
designed to be rented for non-commercial storage, and may include some office/living space. Each class
differs only in structure and exterior features.
CLASS 950—Class S or P (Metal Frame and Walls)
CLASS 960—Class C&D (Wood or Steel Frame)
CLASS 970—Class B &C (Masonry Bearing Walls,including Tilt-Up)
CLASS 1000 & 1001
Self Service Car Wash. Class 1000 is a coin operated self-service care wash. Class 1001 is the
equipment room. Equipment that is considered personal property is included in the building cost. The
quality levels are low cost,average and good. Use low cost prices for metal wall construction, and
average and good prices for masonry wall construction.
CLASS 1002
Drive-Thru Car Wash. Equipment that is considered personal property is not included in the building
cost. The quality levels are average and good. Use average price for masonry or steel construction, and
good price for porcelainized steel construction.
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CLASS 1003
Automatic Car Wash. Full service car wash buildings include finished office area, locker and restrooms
and basic equipment room. Equipment that is considered personal property is not included in the building
cost. The quality levels are average and good. Use average price for masonry or steel construction, and
good price for porcelainized steel construction.
CLASS 1010
Airplane hangar. Low cost hangar used only for airplane storage. There are minimal electrical and
plumbing fixtures.
CLASS 1020
T-Hangars are multiple hangars for small planes. Many include partitioned areas for individual planes.
Interiors have concrete slab floors with very few extras. They have minimum electrical, occasionally
plumbing, and commonly do not have heating or cooling.
CLASS 1030
Airplane Hangar. Average quality hangar used for storage and repair maintenance of small aircraft.
These hangars have some office area, storage area, and restroom and plumbing facilities for small crews
of maintenance personnel.
CLASS 1031
Airplane Hangar. Good quality hangar used for storage and repair maintenance of small aircraft. These
hangars have some office area, storage area, and restroom and plumbing facilities for small crews of
maintenance personnel.
CLASS 1040-1060
Commercial Greenhouses are designed for the growth of plants. Each class differs in structure and
exterior features.
CLASS 1040—Steel Frame and Glass
CLASS 1050—Steel or Wood Frame and Fiberglass
CLASS 1060—Wood Frame and Poly-cover
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CLASS 1070
Residential Greenhouse
CLASS 1070—Wood or Aluminum Frame
CLASS 1100-1110
Theaters are designed primarily for stage or screen presentations and include a stage commensurate with
the type and quality of construction. Scenery,curtains, and seating are not included in the costs.
CLASS 1100—Low Cost
CLASS 1110—Average Quality
CLASS 1200
Telephone Exchange Building.
CLASS 1210
Communications Equipment Building.
CLASS 1300-1320
Funeral Homes are buildings with facilities for the preparation of the dead for burial or cremation, for
viewing of the body and for funerals.
CLASS 1300—Low Cost
CLASS 1310—Average Quality
CLASS 1320—Good Quality
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CLASS 1400-1420
Bowling Alley and Roller Skating Rink buildings generally include a snack bar,billiard and
miscellaneous rooms with necessary plumbing and electrical connections. These buildings do not include
any equipment or fixtures such as alleys,ball returns,hardwood floor(skating rink)kitchen and bar
equipment or other trade fixtures that are considered personal property.
CLASS 1400—Low Cost
CLASS 1410—Average Quality
CLASS 1420—Good Quality
CLASS 1500- 1501
Parking Garages are structures with no exterior walls (or with partial walls)designed for above grade
storage of automobiles. The quality levels are average and good.
CLASS 1600- 1630
Barns
CLASS 1600—Wood frame and dirt floor.
CLASS 1610—Wood frame and concrete floor.
CLASS 1620—Steel Frame and dirt floor.
CLASS 1630—Steel Frame and concrete floor.
CLASS 1640
Kiosks are small retail booths that range anywhere from 25 to 200 square feet. They have minimum
electrical and plumbing fixtures.
CLASS 1650—1670
Outbuilding/Storage
CLASS 1650—Low Cost
CLASS 1660—Average Quality
CLASS 1670—Good Quality
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CLASS 1680
Stables
CLASS 1680—Average, Good,Best, and Excellent Quality
CLASS 1690
Marina Boathouses and Slips are small to medium berths of light construction on lakefronts. Ramps,
anchor piers, lockers, and floatation drums are included in the cost. Utilities are additives. Quality levels
are low for open slips,and good for fully enclosed boathouses.
CLASS 1700
Grain Elevators
CLASS 1710
Water Tanks
CLASS 1720
Pipe Rail Fence
CLASS 1730
Pipe&Cable Fence
CLASS 1740-1740B
Tennis Courts. There are three pricing levels for tennis courts based on amenities.
CLASS 1740— Includes fence and lighting
CLASS 1740A—Includes fence
CLASS 1740B—Court only
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CLASS 1750
Residential Swimming Pool
CLASS 1750—Basic,Average,Good,Excellent, Superior Quality
CLASS 1760
Wood Deck
CLASS 1770
Circular Training or Walking Arenas
CLASS 1770—Low,Average, and Good Quality
CLASS COM
Commercial Swimming Pools are large recreational pools found in hotels, apartments, etc. Costs are for
gunite pools and include chlorinators, filters,heaters,boards,ladders and coping.
CLASS 1780
Condominiums are now classed as apartments. See classes 120-140.
CLASS 1790-1810
Country Clubs are specialized clubhouses designed mainly for entertainment and have few, if any
sleeping rooms. Generally,the better clubs will have a ballroom,bar,banquet and pro shop facilities,as
well as locker and shower rooms. These classes are meant to price only the main clubhouse.
Outbuildings,pools,tennis courts and golf holes are priced separately.
CLASS 1790—Low Cost
CLASS 1800—Average Quality
CLASS 1810—Good Quality
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CLASS 1900
Golf Course. Low cost, simply developed budget course on open, flat terrain, few bunkers, small tees and
greens.
CLASS 1910
Golf Course. Average quality, simply designed course on relatively flat terrain, natural rough, few
bunkers, small built-up tees and greens, as well as some small trees.
CLASS 1920
Golf Course. Good quality course, undulating terrain, bunkers at most greens, some large trees and
driving range.
CLASS 1930
Golf Course. Excellent quality, championship course on good undulating terrain, fairway and greens
bunkered and contoured, large tees and greens, driving range, and name architect.
CLASS 1940
Golf Course. Better championship-type course on good undulating terrain, fairway and greens bunkered
and contoured, large tees and greens, large trees transplanted, driving range,may have name architect.
CLASS 2000
Mobile Home Park Spaces are developed for permanent occupancy and are representative of low end
parks. The spaces can accommodate homes up to 80 feet long and 28 feet wide. Each space will have
utilities,but recreational facilities such as pool and clubhouse are rarely provided.
CLASS 2010
Mobile Home Park Spaces are developed for permanent occupancy and are representative of average
parks. The spaces can accommodate homes up to 80 feet long and 28 feet wide, and all utilities are
available. This class of park usually has a clubhouse and pool, as well as good streets,patios,walks, and
some landscaping.
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CLASS 2100
Ornamental Entry Way
CLASS 2100—Average, Good,Best Quality
C. Income Approach
The income approach to value is applied to those real properties which are typically viewed by market
participants as"income producing,"and for which the income methodology is considered a leading value
indicator. The DCAD computerized program utilizes the direct capitalization method.
The first step in the income approach is to estimate the potential gross rent(PGR)for the property.
Potential gross rent is the rent that would be collected if the property were fully occupied at market rent.
PGR=UNIT RENT x#UNITS
PGR can be derived from a variety of sources ranging from local market study publications,to actual rent
data furnished by property owners. The computer program allows for three different methods of
establishing PGR. Most commercial properties lease based on a lease rate per square foot, in which case
the appraiser inputs the net or gross leasable area and the monthly or annual square foot lease rate. The
computer then calculates the potential gross rent. For those properties that lease by the unit, such as
apartments,the appraiser may input the number of units and the annual lease rate for one unit. The
computer then calculates the PGR. The appraiser can also manually calculate the PGR by entering a
dollar amount in the computer.
A vacancy and collection loss allowance is the next item to consider in the income approach. Vacancy
and collection loss is an allowance for reductions in potential income attributable to vacancies,tenant
turnover, and nonpayment of rent. The allowance is estimated as a percentage of potential gross income,
which varies depending on the type and characteristics of the physical property, and general and local
economic conditions.
V&C LOSS=PGR x%V&C LOSS
The projected allowance is established based on local market study publications,and actual data collected
from property owners. This allowance accounts for periodic fluctuations in occupancy,both above and
below an estimated stabilized level. The appraiser enters a vacancy and collection loss percentage that is
typical within the market for the property being appraised. Once the percentage is entered,the computer
will calculate the dollar amount. The market derived stabilized allowance is then subtracted from the
potential gross income. Miscellaneous property income(which is not subject to v/c loss) such as parking,
vending machines, and laundry are then added to arrive at an effective gross income.
EGI=(PGR—V&C LOSS)+MISC. INCOME
Allowable expenses and expense ratio estimates are based on a study of the local market,with the
assumption of prudent management. Categories of allowable operating expenses include insurance;
administrative costs for the property such as legal, accounting, advertising, and management fees;repair
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and maintenance such as extermination,janitor's salaries,trash collection,hardware, and supplies;
utilities such as fuel,water, and electricity; and property taxes. Different expense ratios are developed for
different types of commercial property based on use. For instance,retail properties are most frequently
leased on a triple-net basis,whereby the tenant is responsible for his pro-rata share of taxes, insurance and
common area maintenance. In comparison,multi-family properties may have the tenants paying utilities,
while the owner pays the remainder of the expenses. As a result, expense ratios must be implemented
based on the type of commercial property being appraised. Another form of allowable expenses are the
replacement of short-lived items(such as roof or floor coverings, air conditioning or major mechanical
equipment or appliances)requiring expenditures of large lump sums. When these capital expenditures are
analyzed for consistency and adjusted,they may be applied on an annualized basis as stabilized expenses.
When performed according to local market practices by commercial property type,these annualized
expenses are known as replacement reserves. The appraiser must carefully analyze the owner's operating
statement to make sure all the expenses are allowable and at market rates. Expenses are entered in the
computer as a dollar amount. Subtracting the allowable expenses(inclusive of replacement reserves)
from the effective gross income results in an estimate of net operating income (NOI).
NOI=EGI—OPERATING EXPENSES
Capitalization rates are used to convert net operating income into an estimate of market value. These
rates vary between property types, as well as by location, quality, condition, design, age, and other
factors. Overall capitalization rates (for the direct capitalization method) can be derived from the market.
Sales of improved properties from which actual income and expense data are obtained provide a very
good indication of what a specific market participant is requiring from an investment at a specific point in
time. We also rely on Henry S. Miller,"Real Estate Investment Trends,"Real Estate Research Corp.,
Integra Realty Resources, and Korpacz Inc., for capitalization rate information for the different types of
commercial properties. Additionally,we survey local fee appraisers regarding typical capitalization rates
by property type.
Rent loss concessions are sometimes made to specific properties with vacancy problems. A rent loss
concession accounts for the impact of lost rental income as the building is moving toward stabilized
occupancy. The rent loss is calculated by multiplying the rental rate by the percent difference of the
property's stabilized occupancy and its actual occupancy. Build out allowances (for first generation space
or renewal/second generation space)and leasing expenses are added to the rent loss estimate. The total
adjusted loss from these real property operations is discounted using an acceptable risk rate. The
discounted value(inclusive of rent loss due to extraordinary vacancy,build out allowances and leasing
commissions)becomes the rent loss concession and is deducted from the value indication of the property
at stabilized occupancy.
D. Market Approach
The market approach to value has a more limited application to commercial properties than to single
family residences because they sell much less frequently and are generally unique unto themselves. For
this reason,prior sales of unique commercial properties may be used as a yardstick for that specific
property but should not be used as comparable for other properties. When commercial properties are very
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similar and compete within the same market parameters,however,the market approach may well provide
the most reliable indication of value.
All commercially zoned and rural land valuation tables and unit prices are derived from comparable sales.
Sales prices are expressed as price per unit, either by square foot or acre—depending on how the land is
analyzed or sold in the market. Once sales have been gathered,the appraiser determines the average or
typical per unit value for a particular stratum of land. The average value is found by calculating the
median or mean sale price per unit. After establishing land unit values,the appraiser can determine
individual parcel values by applying any necessary site adjustments. Site adjustments recognize the
characteristics of individual parcels, such as size, shape,topography, and location(corner influence,
limited access, etc.).
When using the market approach,the appraiser should take care to assure that the sales price is the total
consideration given for the property. This is a formidable task since commercial properties are normally
traded in a market from which it is difficult for the appraiser to extract information. For example,many
sales can include significant amounts of personal property. If these sales are used in ratio studies,the
value of the personal property must be estimated and subtracted from the sale price in order to determine
the purchase price for the real property alone. Personal property consists of inventories(raw materials,
finished goods, supplies,etc.), fixed assets(machinery, equipment, furniture and fixtures, etc.),and
intangibles(bonds,mortgages, insurance policies, cash, stocks, goodwill or business value, etc.).
Appraisers should scrutinize each sale for items of personal property, estimate their market value, and
deduct it from the total purchase price. Whenever data on personal property is unavailable,the appraiser
should attempt to estimate a percentage of the sale that is attributable to personal property. This can be
achieved by reviewing a sample of sales,by property type, and determining the percentage of the
purchase price commonly attributable to personal property. If the personal property component of a sale
cannot be estimated,the sale can be excluded from ratio studies. The appraiser should gather as many
details as possible on any sales he may collect to allow that information to be used in the future as
comparable sales.
Pertinent data from actual sales of properties,both vacant and improved, is pursued throughout the year in
order to obtain relevant information that can be used in all aspects of valuation. For example, sales of
similarly improved properties can provide a basis for capitalization rates used in the income approach.
Improved sales are also used in ratio studies,which afford the appraiser an excellent means of judging the
present level and uniformity of appraised values.
E. Sales Information
All sales information collected is the responsibility of the Sales and Research Department. Commercial
improved sales are collected from a variety of sources including,but not limited to,district questionnaires
sent to buyer and seller, field discovery,protest hearings,Roddy Report, Costar Group,Loopnet,builders,
real estate professionals, and fee appraisers. A system of type, source, and validity codes was established
to define salient facts related to a property's purchase or transfer. Neighborhood and ISD sales reports are
generated as a tool for the appraiser in the development of value estimates. Sales information is stored in
the mainframe database and on excel spreadsheets.
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F. Statistical Analysis
The appraisers in the Commercial Department perform an annual statistical analysis to evaluate whether
values are equitable and consistent with the market. Ratio studies are conducted on each neighborhood
and ISD to judge the two primary aspects of mass appraisal accuracy: level, and uniformity of value.
Appraisal statistics of central tendency and dispersion generated from sales ratios are available for each
property type being studied. These summary statistics including,but not limited to,the median,the mean,
the weighted mean, standard deviation,coefficient of dispersion(COD), and coefficient of variation
(COV),provide the appraiser a tool by which to determine both the level and uniformity of appraised
value of a particular property type. The level of appraised value can be determined by the weighted mean
for individual properties within a within a specific type, and a comparison of weighted means can reflect
the general level of appraised value. Review of the standard deviation,coefficient of dispersion and the
coefficient of variation can discern appraisal uniformity within a specific property type.
Every commercial property type is reviewed annually by the appraiser through the sales ratio analysis
process. The first phase involves ratio studies that compare the recent sales prices of properties to the
appraised values of the sold properties. This set of ratio studies affords the appraiser an excellent means
of judging the present level of appraised value and uniformity of the appraised values. The appraiser,
based on the sales ratio statistics and designated parameters for valuation update,makes a preliminary
decision as to whether the value level of a particular property type needs to be updated in an upcoming
reappraisal,or whether the level of market value is at an acceptable level.
The commercial department creates income schedules for multi-family, office,retail, and industrial
properties on an annual basis. Actual rent,occupancy and expense data is collected from property
owners. We also collect actual data from published sources and local vendors when data from property
owners is not forthcoming. The data is entered into Excel spreadsheets and grouped by property type,
neighborhood(market)area, and quality(class).
Averages and medians for income and expense variables are then calculated and entered into the
computer system,which calculates the income schedule value for the property. During the annual
reappraisal analysis,the appraiser will be able to choose between the income schedule value(based on
prevailing market conditions),the income direct cap value(based on the actual subject property data), and
the cost approach value. Before deciding on a final market value,the appraiser should check for any
comparable sales in order to make an informed judgment.
2.07 Residential Vacant Lots
A. Area Anal
Data on regional economic forces such as demographic patterns,regional location factors,employment
and income patterns, general trends in interest rates, availability of vacant land, and construction trends
are collected from private vendors and public sources. Information is gleaned from real estate
publications and sources such as the real estate professionals,Dallas Business Journal,IAAO,Texas
A&M Real Estate Department, Realty Trac,National Association of Independent Fee Appraisers
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(NAIFA), foreclosure listing and applicable sources found on the internet; such as realtor.com.
Monitoring these sources help to give the appraisal staff a current economic outlook on Denton County's
real estate market. The residential department monitors available lot inventory and new construction. All
of this impacts the values of the available lots.
All employees shall have the knowledge and expertise to do their job. Each employee will have a
minimum educational standard required for their position. In addition, DCAD will supply the following:
A. On the job training—each employee will receive training on procedures,policy,and
equipment by their supervisor and other employees in similar positions.
B. State required education and registration—all employees so required will achieve and maintain
their own educational and registration requirements.
C.Additional training and education—from time to time, additional training and education will
be required to enhance job performance,knowledge and expertise.
Employees will be expected to perform to a minimum standard.
An appraisal management policy should reflect regulatory obligations,mandate due diligence, ensure
conformance to professional standards,generate current and meaningful valuations, and establish criteria
for a thorough review process. DCAD subscribes to the standards of the International Association of
Assessing Officers (IAAO)regarding its appraisal practices and procedures. DCAD also subscribes to the
standards promulgated by the Appraisal Foundation known as the Uniform Standards of Professional
Appraisal Practice(USPAP). A current copy of the USPAP manual is on file at DCAD. The department is
responsible for completing mass appraisal assignments in a timely manner.
A. Definition of Appraisal Responsibility
The Residential Department is responsible for estimating the market value for all residential vacant lots.
B. Legal and Statutory Requirements
The provisions of the Texas Property Tax Code (TPTC)and relevant legislative measures involving
appraisal administration and procedures control the work of the appraisal district. The district is
responsible for appraising property on the basis of its market value as of January 1 for ad valorem tax
purposes for each taxing unit that imposes ad valorem taxes on property in the district. DCAD reappraises
property on an annual basis.
C.Administrative Requirements
An appraisal management policy should reflect regulatory obligations,mandate due diligence, ensure
conformance to professional standards,generate current and meaningful valuations, and establish criteria
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for a thorough review process. DCAD subscribes to the standards of the International Association of
Assessing Officers (IAAO)regarding its appraisal practices and procedures. DCAD also subscribes to the
standards promulgated by the Appraisal Foundation known as the Uniform Standards of Professional
Appraisal Practice(USPAP). A current copy of the USPAP manual is on file at DCAD.
D. Appraisal Resources
Data-A common set of data characteristics for each residential dwelling in Denton County is collected in
the field and data entered to the DCAD mainframe computer. The property characteristic data drives the
computer-assisted mass appraisal approach to valuation.
A common set of data characteristics for each land account in DCAD is collected in the field and data is
entered to the DCAD mainframe computer. Information on sold properties is reviewed using GIS and
aerial photography. Sales are plotted on the map to review location, access, and topography of the sold
land. The property characteristic data drives the computer-assisted mass appraisal approach to valuation.
Information Systems—The mainframe systems are augmented by the databases that reside as various
applications on the DCAD Local Area Network(LAN). DCAD offers a variety of systems for providing
property owners and public entities with information services.
B. Sales and Statistical Analysis
A. Sales Information
The Residential Department will process all sales information collected by the Sales Department. As
much pertinent information as possible is gathered about the sale to help determine the quality and
conditions of the sale; for example, does the sale appear to be an arm's length transaction or not. A
system of type, source and validity codes has been established to help define these salient facts related to
a property's purchase or transfer. Entity,neighborhood and subdivision sales reports are generated as an
analysis tool for the appraisal analyst in the development of value estimates. Sales information is stored in
the appraisal district CAMA Software. Refer to the software user's manual for software implementation.
B. Statistical Analysis
Appraisers in the appraisal departments perform statistical analysis annually to evaluate whether values
are equitable and consistent with the market. Ratio studies are conducted on each property category,
neighborhood and ISD to judge the two primary aspects of mass appraisal accuracy—level and uniformity
of value. Appraisal statistics of central tendency and dispersion generated from sales ratios are available
for each property category and/or neighborhood within an ISD and summarized. These summary statistics
including,but not limited to,the median,the mean,the weighted mean, standard deviation, coefficient of
dispersion(COD), and coefficient of variation(COV),provide the analysts an analytical tool by which to
determine both the level and uniformity of appraised value of a property category and/or neighborhood
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basis. Review of the standard deviation, coefficient of dispersion and the coefficient of variation can
discern appraisal uniformity within and between categories and ISD's.
Subdivisions and/or neighborhoods are reviewed annually by the appraiser through the sales ratio analysis
process. The first phase involves subdivision/neighborhood ratio studies which compare the recent sales
prices with the appraised values of those properties which have recently sold. This set of ratio studies
affords the appraiser an excellent means of judging the present level of appraised value and uniformity of
the sales. All valid sales that we are aware of are used unless the result is misrepresentative.
C. Market Adjustment or Trending Factors
Market adjustment factors are developed from appraisal statistics provided from ratio studies and are used
to ensure that estimated values are consistent with the market.
If the subdivision/neighborhood is to be updated,the appraiser uses a ratio study that compares recent
sales prices of properties within a delineated subdivision/neighborhood with the properties' appraised
value. The calculated ratio derived from the sum of the sold properties' appraised value divided by the
sum of the sales prices indicates the subdivision/neighborhood level of value based on the unadjusted
value for the sold properties. This comparison of appraised value-to-sale ratio determines the market
adjustment factor for each subdivision/neighborhood. This market adjustment factor is needed to trend the
values closer to the actual market evidenced by recent sales prices within a given
subdivision/neighborhood. The market adjustment factor calculated for each updated
subdivision/neighborhood is applied uniformly to all properties within a neighborhood and as needed in
the subdivision. Once the market-trend factors are applied, a second set of ratio studies is generated that
compares recent sale prices with the proposed appraised values for these sold properties.From this set of
ratio studies,the appraiser judges the appraisal level and uniformity in both updated and non-updated
subdivision/neighborhoods,and finally, for the school district as a whole.
C. Performance Tests
A. Sales Ratio Studies
The primary analytical tool used by the appraiser to measure and improve performance is the ratio study.
This helps to insure that the appraised values that it produces meet the standards of accuracy in several
ways. Overall sales ratios are generated for each ISD to allow the appraiser to review general market
trends and provide an indication of market appreciation or depreciation over a specified period of time.
Sales ratio reports are run several times prior to the setting of preliminary values as well as after
finalization of appraisal values in order to catch any inaccuracies,value anomalies, or outliers.
An independent test of the appraisal performance of the district is conducted by the State of Texas
Comptroller's Office through the annual property value study. The study determines the degree of
uniformity and the median level of appraisals by the appraisal district within each major category of
property. The comptroller publishes a report of the study,which includes in the report the median levels
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of appraisal for each major category of property,the coefficient of dispersion around the median level of
appraisal for each category of property, and any other standard statistical measures that the comptroller
considers appropriate.
EXAMPLE OF LOT VALUE CALCULATION:
Most residential lots,both improved and vacant are calculated using the appraisal districts' "L"Method.
Lot square foot times dollar per square foot times%adjustment for size
D. Sales and Statistical Analysis
A. Sales Information
The Residential Department will process all sales information collected by the Sales Department. As
much pertinent information as possible is gathered about the sale to help determine the quality and
Example 1.
14,000 sq. ft. lot size
$3.50 per sq. ft.
25%adjustment for lots over 14,000 sq. ft.
Subject Lot Size 16,500 sq. ft.
Pt 14,000 @$3.50=$49,000
2nd 2,500 @$3.50 @ 25%= $2,187
Total Lot Value $51,187
In this scenario the lots vary in size and the larger lots in the neighborhood would need to be adjusted
otherwise the larger lots would be over-appraised
conditions of the sale as set forth in IAAO Standard on Verification and Adjustment of Sales 4.4,4.6,4.7,
EEthis
.
size
er sq.ft.
r lot size
50,000=$50,000
nario all of the lots would be very similar in size and the neighborhood very homogeneous.
4.8, 4.9,4.10, and 4.11. Examples include;Are the parties related?Does the sale appear to be an arm's
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length transaction or not?Was there any personal property included? A system of type, source and
validity codes has been established to help define these salient facts related to a property's purchase or
transfer. Entity,neighborhood and subdivision sales reports are generated as an analysis tool for the
appraisal analyst in the development of value estimates. Sales information is stored in the appraisal
district CAMA Software. Refer to the software user's manual for software implementation.
B. Sale Adjustments
The market value of property is what it would sell for in cash terms or the equivalent. This means that
any sale that has nonmarket financing must be adjusted to reflect what the prevailing market conditions
would be without that special financing. Typical bank loans are at the market rates while owner financed
sales can be skewed to correct for the different rates that the seller is offering(IAAO Standard on
Verification and Adjustment of Sales 7.4). This also applies to personal property that has been included
in a sale. Appraisers must determine the contributory value of personal property and adjust sale price to
reflect only the real property included in a sale(IAAO Standard on Verification and Adjustment of Sales
7.5). Sales are also adjusted to reflect changes to the property between the sale date and appraisal date.
An example would be a property is purchased on 4/1/16 and then the new owner adds a pool to the
property. This will add value that is not included in the purchase price,but should be considered when
using the sales information to arrive at values for 1/1/17.
C. Statistical Analysis
Appraisers in the appraisal departments perform statistical analysis annually to evaluate whether values
are equitable and consistent with the market. Ratio studies are conducted on each property category,
neighborhood and ISD to judge the two primary aspects of mass appraisal accuracy—level and uniformity
of value. Appraisal statistics of central tendency and dispersion generated from sales ratios are available
for each property category and/or neighborhood within an ISD and summarized. These summary statistics
including,but not limited to,the median,the mean,the weighted mean, standard deviation, coefficient of
dispersion(COD), and coefficient of variation(COV),provide the analysts an analytical tool by which to
determine both the level and uniformity of appraised value of a property category and/or neighborhood
basis. Review of the standard deviation, coefficient of dispersion and the coefficient of variation can
discern appraisal uniformity within and between categories and ISD's.
Subdivisions and/or neighborhoods are reviewed annually by the appraiser through the sales ratio analysis
process. The first phase involves subdivision/neighborhood ratio studies which compare the recent sales
prices with the appraised values of those properties which have recently sold. This set of ratio studies
affords the appraiser an excellent means of judging the present level of appraised value and uniformity of
the sales. All valid sales that we are aware of are used unless the result is misrepresentative.
D. Market Adjustment or Trending Factors
Market adjustment factors are developed from appraisal statistics provided from ratio studies and are used
to ensure that estimated values are consistent with the market.
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If the subdivision/neighborhood is to be updated,the appraiser uses a ratio study that compares recent
sales prices of properties within a delineated subdivision/neighborhood with the properties' appraised
value. The calculated ratio derived from the sum of the sold properties' appraised value divided by the
sum of the sales prices indicates the subdivision/neighborhood level of value based on the unadjusted
value for the sold properties. This comparison of appraised value-to-sale ratio determines the market
adjustment factor for each subdivision/neighborhood. This market adjustment factor is needed to trend the
values closer to the actual market evidenced by recent sales prices within a given
subdivision/neighborhood. The market adjustment factor calculated for each updated
subdivision/neighborhood is applied uniformly to all properties within a neighborhood and as needed in
the subdivision. Once the market-trend factors are applied, a second set of ratio studies is generated that
compares recent sale prices with the proposed appraised values for these sold properties.From this set of
ratio studies,the appraiser judges the appraisal level and uniformity in both updated and non-updated
subdivision/neighborhoods, and finally, for the school district as a whole.
E. Performance Tests
A. Sales Ratio Studies
The primary analytical tool used by the appraiser to measure and improve performance is the ratio study.
This helps to insure that the appraised values that it produces meet the standards of accuracy in several
ways. Overall sales ratios are generated for each ISD to allow the appraiser to review general market
trends and provide an indication of market appreciation or depreciation over a specified period of time.
Sales ratio reports are run several times prior to the setting of preliminary values as well as after
finalization of appraisal values in order to catch any inaccuracies,value anomalies, or outliers.An
independent test of the appraisal performance of the district is conducted by the State of Texas
Comptroller's Office through the annual property value study. The study determines the degree of
uniformity and the median level of appraisals by the appraisal district within each major category of
property. The comptroller publishes a report of the study,which includes in the report the median levels
of appraisal for each major category of property,the coefficient of dispersion around the median level of
appraisal for each category of property, and any other standard statistical measures that the comptroller
considers appropriate.
EXAMPLE OF LOT VALUE CALCULATION:
Most residential lots,both improved and vacant are calculated using the appraisal districts' "L"Method.
Lot square foot times dollar per square foot times%adjustment for size
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LExample formula would be; 14,000 sq.ft. lot size
$3.50 per sq.f.t
25% adj for lots over 14,000 sq.ft.
Lot size is 16,500
Pt 14,000 @$3.50= $49,000
2nd 2,500 @$3.50 @ 25%_ $ 2,187
Total value of lot $51,187
In this scenario the lots vary in size and the larger lots in the neighborhood would need to be adjusted
otherwise the larger lots would be over-appraised.
2. Example formula would be; 1 sq.ft lot size
$50,000 per sq.ft.
0%adj for lot size
lst 1 @$50,000= $50,000
In this scenario all of the lots would be very similar in size and the neighborhood very homogeneous.
2.08 Individual Value Review Procedures
A. Field Review
Property field inspections may be initiated for a variety of reasons. A property owner might dispute the
district's appraisal attributes or data concerning his property. Typically, a new field check is then
requested to verify this evidence for the current year's valuation or for the next year's valuation.
Additionally, if a building permit is filed for a particular property indicating a change in characteristics,a
field check is then scheduled for that property. Finally, even though every property cannot be inspected
each year, each appraiser typically designates certain segments of their area of responsibility to conduct
field checks.
Commercial appraisers are somewhat limited in the time available to field review all commercial
properties of a specific use type. Still, a major effort is made by appraisers to field review properties and
economic areas experiencing large numbers of remodels,renovations or retrofits,changes in occupancy
levels or rental rates,new leasing activity,new construction, or wide variations in sale prices.
Additionally,the appraiser frequently field checks subjective data items such as building class, quality of
construction, condition, and physical, functional and economic obsolescence factors contributing
significantly to the market value of the property. Sometimes field reviews are warranted when sharp
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changes in occupancy or rental rate levels occur between building classes or between economic areas.
Appraisers also physically inspect sold and unsold properties for comparability and consistency of values.
hi addition to conducting field reviews on a priority basis as discussed above,the commercial department
physically reviews all properties every 6 years as outlined in the IAAO Standard on Mass Appraisal.
Each appraiser identifies 1/6'of the properties within their area of responsibility and conducts field
inspections at the same rate every year,until 100%of the properties have been inspected.
Commercial data collectors should present themselves in a polite and businesslike manner and be
prepared to deal with a variety of situations and personalities. Data collectors should always take the time
to fully explain the reason for their visit, and are required to carry DCAD issued photo identification
badges and business cards.
B. Office Review
Office reviews are completed on properties not subject to field inspections. Valuation reports comparing
previous values against proposed and final values are generated for all commercial improved properties.
Also,previous values resulting from a formal hearing protest, lawsuit, and others from informal hearings
are individually reviewed to determine if the value remains appropriate for the current year. When
reviewing these properties, each appraiser considers all currently available cost,market, and income data
before deciding on the final appraised value.
Once the appraiser is satisfied with the level and uniformity of value for each commercial property within
their area of responsibility,the new values are entered into the district's mainframe computer. Because
the value estimates are determined in a computerized mass appraisal environment,appraisers review
value reports for anomalies before the final appraised value is released for noticing.
2.09 Performance Tests
A. Sales Ratio Studies
The primary tool used to measure mass appraisal performance is the ratio study. A ratio study compares
appraised values to market values. In a ratio study,market values (value in exchange) are typically
represented by sales prices(i.e. a sales ratio study). Independent,expert appraisals may also be used to
represent market values in a ratio study(i.e. an appraisal ratio study). If there are not enough sales to
provide necessary representation, independent appraisals can be used as indicators for market value. This
can be particularly useful for commercial,warehouse or industrial real property for which sales are
limited. In addition, appraisal ratio studies can be used for properties that are by statute not appraised at
market value,but reflect the use-value requirement. An example of this are multi-family housing projects
subject to subsidized rent provisions or other governmental guarantees as provided by legislative statutes
(affordable housing)or agricultural lands to be appraised on the basis of productivity or use value. Sales
ratio studies are an integral part of establishing equitable and accurate market value estimates, and
ultimately assessments for taxing jurisdictions. The primary uses of sale ratio studies include the
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determination of a need for general reappraisal;prioritizing selected groups of property types for
reappraisal; identification of potential problems with appraisal procedures; and, assist in market analyses.
Pursuant to Chapter 5, of the Texas Property Tax Code, and Section 403.302, of the Texas Government
Code,the Comptroller's Property Tax Division(PTD)conducts an annual property value study(PVS) of
each Texas school district and each appraisal district. As a part of this annual study,the code also
requires the Comptroller to:use sales and generally accepted auditing and sampling techniques;test the
validity of school district taxable values in each appraisal district and presume the appraisal roll values are
correct when values are valid; and, determine the level and uniformity of property tax appraisal in each
appraisal district. The methodology used in the property value study includes stratified samples to
improve sample representation and techniques or procedures of measuring uniformity. This study utilizes
statistical analysis of sold properties(sale ratio studies)and appraisals of unsold properties (appraisal ratio
studies) as a basis for assessment ratio reporting. For appraisal districts,the reported measures include
median level of appraisal,coefficient of dispersion(COD),the percentage of properties within 10%of the
median,the percentage of properties within 25%of the median, and price-related differential(PRD)for
properties overall and by state category.
2.10 Value Defense Procedures
The appeals process begins with an informal meeting between the appraiser and the property owner to
discuss any errors, discrepancies of market value and/or equity, and any claims of exemptions or special
valuations(agricultural use,restricted use value, etc.). The informal review may be handled by mail, in
person, or by telephone. The review allows for communication and mutual understanding,which will
reduce the number of formal appeals. Informal reviews should incorporate the following basic steps:
1)Verify the parcel information; 2)Exchange information; 3)Record the nature of complaint;4)Use cost,
sales, or income information to confirm property value; 5)If a value change is indicated,the appraiser will
change the value and enter into a signed agreement with the property owner; 6)If a value change is not
warranted,the appraiser should explain the appeal rights and procedures, in case the property owner
wishes to make a formal appeal. Commercial field appraisers must get written approval from the
Commercial Manager or Supervisors to settle any property with an appraised value of$50,000,000 or
higher.
Appraisal Review Board hearings(formal appeals) are the next step in the appeals process. Prior to the
hearing,the property owner should be given a copy of the evidence the appraiser plans to use in evidence.
The appraiser should be prepared to present factual information relating to the property, such as copies of
tax maps,pictures of the property, improvement drawings, etc.,as well as valuation information, such as
the cost,market, and income approaches to value. If there is an equity component to the appeal,the
appraiser should be prepared to present a reasonable sample of equity comparables based on sales or
income, as appropriate.
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2.11 Education and Training
All employees shall have the knowledge and expertise to do their job. Each employee will have a
minimum educational standard required for their position. In addition,DCAD will supply the following:
A. On the job training—each employee will receive training on procedures,policy, and
equipment by their supervisor and other employees in similar positions.
B. State required education and registration—all employees so required will achieve and
maintain their own educational and registration requirements.
C.Additional training and education—from time to time, additional training and education
will be required to enhance job performance,knowledge and expertise.
Employees will be expected to perform to a minimum standard.
2.12 Data Entry Procedure
All appraisal changes and updates are written on appraisal cards and given to the commercial appraisal
support specialist. The appraisal support specialist organizes incoming and outgoing appraisal cards by
appraiser, date, and legal description at the data entry station.
The information is entered by way of a"dump terminal"and keyboard at the data entry station. The
commercial appraisal support specialist is responsible for entering abstract, industrial, commercial and
residential land,commercial and rural improvements, agricultural valuations, and sales information.
Incomplete and erroneous information on appraisal cards is returned to the appraiser for correction.
Once appraisal changes have been made,updated appraisal cards are printed,processed, and delivered to
the appraisers. After checking the updated cards for accuracy,they are returned to the appraisal support
specialist for filing.
2.13 Commercial Department Reappraisal Plan Overview
This plan outlines the implementation and completion of all required tasks and reappraisal that is
mandated by the State Property Tax Code. The commercial department reappraises all properties every
two years,which works out to approximately 50%of properties reappraised in any given year(including
50%of vacant or improved land accounts). The reappraisal consists of a property inspection(office
and/or field), as well as income, sales,and equity analysis, as warranted. Rapidly changing market areas
will be reappraised on an annual basis as time permits.
Building permits are collected from each city on a monthly basis. The permits are processed and attached
to the applicable account, after which the appraiser conducts a physical inspection and office review for
the current appraisal year. All value related building permits issued from December 1,2017 through
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November 30,2018 will be inspected and reappraised for the 2019 appraisal year. All value related
building permits issued from December 1,2018 through November 30,2019 will be inspected and
reappraised for the 2020 appraisal year. Additionally, all buildings that were partially complete as of
January 1 will be coded for reappraisal the following year.
Property characteristic data, entered by appraisal support personnel, is verified and corrected by
appraisers based on field inspections or office review utilizing aerial photography. The following data
characteristics are added to each property account as applicable: Land Value, SPTD Code,Building
Class,Gross Building Area,Net Leasable area,Actual Year Built, Effective Age,Number of Stories,
Construction Quality/Condition Codes,Number of Buildings, Foundation Type,Percent Finish Out,
Exterior Wall Type,Interior Finish Type,Heating/Cooling,Plumbing,Roof Covering, Story Height,
Docks, Sprinkler System,Elevators. In addition to the physical characteristics, data is collected on an
annual basis for income producing properties—including:Net Leasable Area,Rent Adjustments and
CAM Charges,Vacancy percentage, Secondary Income, Expense Recoveries,Expense Information,and
Cap Rates.
Income producing property categories such as multi-family,retail, office, and industrial are coded with an
economic area code,which groups properties located within the same competing market area. The
economic area boundaries follow school district or city limit lines. Income models (based on the
collected data)are then developed for each comparability code(A,B, C)for the respective property types.
Income model data entered into the PACS appraisal system thereby produces an"income schedule"
value,which should reflect the market influences that affect the market values within each economic area.
The income schedule value can be used to check for equality and uniformity by property type within an
economic area, or to create an income value for those properties not previously valued by the income
approach.
Commercial sales ratio studies are conducted annually by economic area and property type. The ratio
studies compare the recent sales prices of properties to the appraised values of the sold properties. If
there are sufficient sales of a specific property type,the market approach can be employed to determine
market values and uniformity of appraised values.
Part C. Agriculture Use
The Texas Constitution permits special agricultural appraisal only if the land meets specific requirements
defined as agricultural use. Section 23.51 of the Property Tax Code sets the standards for determining
whether land qualifies.
2.21 Application
The property owner must apply for the agricultural use appraisal. The property tax code provides
applications for 1-d (Agricultural Appraisal), 1-d-1 (Open Space Agricultural Appraisal), 1-d-1 (Open
Space Land, Timber Land) and 1-d-1 (Open Space Agricultural Valuation Wildlife Management). The
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applications are received in January through the end of April(April 30-is the deadline to file). Applications
can be filed after the deadline up until the time the appraisal roll is approved by the Appraisal Review Board
(ARB) and if approved is assessed a 10% late filing penalty for that year only. Currently DCAD does not
have any applications filed under 1-d or 1-d-1 Timber Land. The property owner is required to notify the
Appraisal District if there is a change of use or if there is any change in the application requiring
updating. Applications are requested to be updated on a 5 year basis once the property is approved to keep
files current.
2.22 Qualification
To qualify the property for the agricultural appraisal the following must be met:
I. The land must be currently devoted principally to agricultural use.
1. Agricultural use includes production of crops, livestock,poultry, fish,or cover crops. It
also can include leaving the land idle for a government program or for normal crop or
livestock rotation. Land used for raising certain exotic animals to produce human food or
other items of commercial value, and cutting wood for use in fences or structures on adjacent
agricultural land also qualifies.
2. Timberland must be used with the intent to produce income and be devoted principally to
the production of timber.
3. Both agricultural land and timberland must be devoted to production at a level of intensity
that is common in the local area.
4. The land must have been devoted to agricultural and/or timber production for at least five
of the past seven years.
5. Repealed by legislature
6. Using land for wildlife management is an agricultural use. Wildlife management means
actively using land that at the time the wildlife management use began was appraised as
qualified open-space land. The land must be used in at least three of seven ways to propagate
a sustaining breeding,migrating,or wintering population of indigenous wild animals for
human use,including food,medicine,or recreation.
Bee Keeping Guidelines
Beekeeping is a qualifying agricultural use if used for the pollination or for the production of
human food or other tangible products having a commercial value. (Sec.23.51(2)Tax Code)
Acreage requirements are set by Texas Property Tax Code to be a minimum of 5 acres and a
maximum of 20 acres to qualify for beekeeping as an agricultural use.
Typically the number of hives per acre is as follows:
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First 5 acres ....................5—6 hives
Additional 10 acres ...........4 additional hives
Remaining 5 acres ............12 hives maximum
The property will need to have a history of agricultural use or the owner will have to establish
the 5 year history with the bee operation to qualify.
II. The qualifications under section 1-d are the same,with the following exceptions:
1. The land has been devoted exclusively to or developed continuously for agriculture for the
three years proceeding the current year.
2. The owner is using and intends to use the land for agriculture as an occupation or a
business venture for profit during the current year.
3. The land must be owned by an individual. Land does not qualify under 1-d if it is owned
by a corporation,partnership,trust or other association.
4. Agriculture is the owner's primary occupation and primary source of income.
Visual inspections are done on all properties where an application has been filed. The appraiser views the
property, makes notes based on the inspection and takes a photograph of both the qualifying property and
the properties determined to be denied. The applications, appraiser's field notes and photographs are
scanned to the account. Those properties that are approved receive a letter stating the approval. Properties
that have been denied receive a letter denying the application,the reason for the denial, and an explanation
on how to protest the denial. The property owner is required to notify the Appraisal District if there is a
change of use or if there is any change in the application requiring updating. Applications are requested to
be updated on a 5 year basis once the property is approved to keep files current.
2.23 Appraisal of Agricultural Land
Each year the Chief Appraiser or his or her designee shall prepare an agricultural value schedule using the
guidelines as set out in the"Manual for the Appraisal of Agricultural Land,"published by the
Comptroller of Public Accounts,Property Tax Division. A copy of the value schedule may be obtained
by the taxpayer upon request.
Introduction
The importance of data collection in the appraisal of agricultural land is crucial to accurate productivity
values and to assess property as the law intended. The data collected in this appraisal process is as
important as data used in the market value calculation.
Purpose and Use
This outline is used to layout the procedures and steps to go through in the collection of agricultural data
in the process of setting the"Agricultural Appraisal Values". This process is undertaken by the
department manager or supervisor staff of the department responsible for the agricultural appraisal.
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Procedures
Denton Central Appraisal District sends out reappraisals on an annual basis,therefore the agricultural
appraisal value is reviewed annually. The"net to land"calculations, categories, and sub categories are
changed with new agricultural information obtained by the district.
(A)Our primary and best source of information comes from the Agricultural Advisory Board.
Denton CAD Agricultural Advisory Board members are a hands on source of information
that the district can ask questions that it needs answered. The board members are a good
representation of the different types of agriculture we have in this county. One member is
a cattle rancher and crop producer. Another member is a crop producer, sod farmer,
improved grass hay and leases land. The other member is mainly involved in the cattle
industry. These activities cover most of the typical agricultural activities for this county.
The district has records of the Agricultural Advisory Boards meetings back to 1990 and
feels this is a very important part of our valuation process.
(B) The Denton County AgriLife Extension Service office is the next source of information
the district uses on a regular basis. Denton Appraisal District has had a good standing
relationship with the Denton County AgriLife Extension office;both organizations assist
the other. DCAD has performed many presentations for the DCAE and their participants,
and DCAE has done the same for DCAD staff. The annual data collected by the
extension office is very valuable and informative in our yearly analysis.
(C) Denton CAD sends out with application requests an"optional"survey on agricultural
use.A survey is also requested on any beekeeping application. The surveys that are
returned with the applications provide us with information about the activities these
producers are involved in and industry norms. These surveys are reviewed with each
application process,but can also be pulled together for cumulative field information.
(D)The district has members of the agricultural advisory board,county extension agent, and
agricultural appraisal staff fill out the Comptroller's"Texas Farm and Ranch Survey"on
an annual basis.
(E) The Denton area FSA and USDA office has also been a good partner in obtaining land
information needed by the district. These offices are located in close proximity to the
DCAD office. These organizations use our maps in the determinations of property size
and location for their participants and DCAD uses their land soil maps for land
categories. It is also helpful to have a person from that organization that can explain their
data if need be.
(F) Denton County is a rapidly growing urban area and agricultural land is being consumed
by urban sprawl. DCAD utilizes information from the surrounding districts to help
establish typical or normal agricultural activities. A lot of the information that this
district receives from leases is skewed by the desire for the investors of the land to save
taxes on the property for a short period of time. This has been the cause of what we call
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negative leases,where the property owner is paying a farmer to work the land to get the
tax savings.
(G)Other sources of information include publications,manuals,and websites. Some of those
websites include;USDA.gov, agecoext.tamu.edu/budgets/,window.state.tx.us, and
tpwd.state.tx.us.
All information gathered from these sources is kept in an agricultural appraisal file and a digital copy is
stored in our database under F: resident, AGRICULTURE. This share file allows all employees involved
in the appraisal of agricultural land access to review the information as needed. Files pertaining to specific
accounts are scanned and kept with the account.
Conclusion
The procedures and sets the appraisal district takes in the agricultural appraisal process are defined in
depth in the Manual for the Appraisal of Agricultural Land under section 3 "Agricultural Appraisal
Process".
2.24 Rollback Procedure
1. The law imposes a rollback tax on 1-d-1 land when it is taken out of agricultural use. The
rollback tax equals the difference between the taxes the owner paid in the five years
preceding the change in use and the taxes the owner would have paid on his property's
market value.
2. The property owner can trigger the rollback by ending agricultural operation or diverting
the property to non-agricultural use. Selling the property does not trigger the 1-d-1 rollback.
If the property owner diverts only part of a property to a non-agricultural use,the rollback tax
only applies to the changed portion.
3. The Chief Appraiser determines if and when the change of use occurs and must send the
owner written notice of the determination. Field appraisers are expected to periodically
inspect agricultural use properties throughout the year to determine if a change of use has
occurred. If the owner does not protest the determination or the Appraisal Review Board
decides the use has changed,the tax assessor will calculate the amount of additional tax due,
add the appropriate amount of interest, and send a rollback tax bill.
The rollback procedures under section 1-d are the same,with the following exceptions:
1. Section 1-d requires a rollback tax when the property is taken out of agricultural use or
when it is sold.
2. The rollback recaptures taxes for the three preceding years.
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NOTE: The agricultural appraisal procedures and requirements discussed in this section are general
in nature. For specific legal requirements,the appraiser should refer to the Property Tax
Code and the"Manual for the Appraisal of Agricultural Land."
AGRICULTURAL USE AND ROLLBACKS
Who is exempt from paying rollback taxes?
1) Federal government
2) State government
3) Local government
a. City
b. School
c. County
d. Special districts
Chapter 23.55 subsection 09
(f)The sanctions provided by Subsection(a)of this section do not apply if the change of use
occurs as a result of:
1) a sale for right-of-way;
2) a condemnation;
3) a transfer of the property to the state or a political subdivision of the state to be used for a
public purpose; or
4) a transfer of the property from the state, a political subdivision of the state, or a nonprofit
corporation created by a municipality with a population of more than one million under
the Development Corporation Act(Subtitle Cl,Title 12,Local Government Code)to an
individual or a business entity for purposes of economic development if the comptroller
determines that the economic development is likely to generate for deposit in the general
revenue fund during the next two fiscal biennium an amount of taxes and other revenues
that equals or exceeds 20 times the amount of additional taxes and interest that would
have been imposed under Subsection(a)had the sanctions provided by that subsection
applied to the transfer.
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What about religious organizations?
Chapter 11.20 subsection (6)
(6)the land that the religious organization owns for the purpose of expansion of the religious
organization's place of regular religious worship or construction of a new place of regular
religious worship if:
1) the religious organization qualifies other property, including a portion of the same tract or
parcel of land, owned by the organization for an exemption under Subdivision(1)or(5);
and
2) the land produces no revenue for the religious organization;
Chapter 23.55
1) (l)The sanctions provided by Subsection(a)of this section do not apply to land owned
by an organization that qualifies as a religious organization under Section 11.20(c)of this
code if the organization converts the land to a use for which the land is eligible for an
exemption under Section 11.20 of this code within five years.
2) (i) The use of land does not change for purposes of Subsection(a)of this section solely
because the owner of the land claims it as part of his residence homestead for purposes of
Section 11.13 of this code.
What about a cemetery?
0)The sanctions provided by Subsection(a)do not apply to a change in the use of land if.
1) the land is located in an unincorporated area of a county with a population of less than
100,000;
2) the land does not exceed five acres;
3) the land is owned by a not-for-profit cemetery organization;
4) the cemetery organization dedicates the land for a cemetery purpose;
5) the cemetery organization has not dedicated more than five acres of land in the county for
a cemetery purpose in the five years preceding the date the cemetery organization
dedicates the land for a cemetery purpose; and
6) the land is adjacent to a cemetery that has been in existence for more than 100 years.
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What is not exempt from a rollback?
1. Any property owner who is not a governmental entity, a religious organization,
cemetery.
How does this apply to new subdivision?
All of the land in the development is subject to a rollback except land dedicated to public street, dedicated
or deeded to a governmental entity. Open space lots,common areas, streets in a gated community,HOA
lots are ALL subject to rollback.
2.25Wildlife Management
In 2001 the 77t1i Legislature enacted House Bill 3123 for the purpose of Wildlife Management(Tax Code
23.51(1)and(7). The intent of the bill was to;
Encourage the preservation of open space for wildlife management and conservation of the state's natural
heritage in all areas of the state
1. To create definitive standards for tax appraisers to follow in determining the qualification of
the property for appraisal on the basis of wildlife management use. (Comptroller's Rule
9.4003 in acted in 2003,repealed 12-2008,new Comptroller Rule 9.2001 replaces rule
9.4003.)
2. To create a mechanism in addition to traditional agricultural use to allow ranchers, farmers,
and land managers to conserve open space.
3. To affirm local control of property taxation.
4. To preserve revenue neutrality for all concerned parties and
5. To allow each property currently qualified in wildlife management use to continue appraised
as open space land.
Qualifications
(7)The definition of"wildlife management"per the Texas Property Tax Code Section 23.51 (7) and(8) is
as follows:
(A)Actively using land that at the time the wildlife-management use began was appraised as
qualified open-space land under this subchapter or as qualified timber land under Subchapter
E in at least three of the following ways to propagate a sustaining breeding,migrating, or
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wintering population of indigenous wild animals for human use,including food,medicine, or
recreation:
(i) Habitat control;
(ii) Erosion control;
(iii) Predator control;
(iv) Providing supplemental supplies of water;
(v) Providing supplemental supplies of food;
(vi) Providing shelters; and
(vii) Making of census counts to determine population;
(B) Actively using land to protect federally listed endangered species under a federal permit if the
land is:
(i) Included in a habitat preserve and is subject to a conservation easement
created under Chapter 183,Natural Resources Code; or
(ii) Part of a conservation development under federally approved habitat
conservation plan that restricts the use of the land to protect federally
listed endangered species; or
(C) Actively using land for a conservation or restoration project to provide compensation for
natural resource damages pursuant to the comprehensive Environmental Response,
Compensation,and Liability Act of 1980,the Oil Pollution Act of 1990,the Federal Water
Pollution Control Act,or Chapter 40,Natural Resources Code.
(8) "Endangered species,""federal permit," and"habitat preserve"have the meanings assigned by
Section 83.011,Parks and Wildlife Code.
A. Texas parks and wildlife region description
In order to implement Comptroller's Rule 9.2001 the appraisal district refers to the Texas Parks and
Wildlife Department(www.tpwd.state.tx.us)to determine the Eco region that the appraisal district
(county) is located. Denton County is located in Region 6; Cross Timbers and Prairies.
Per the Texas Parks and Wildlife this region is:
A transitional area for many plants and animals. Average annual rainfall averages 28-40 inches
per year... Upland soils are light colored, acidic sandy loam or sands. Bottomland soils may be
light brown to dark gray and acidic with textures ranging from sandy loams to clays. The
landscape of the region is gently rolling to hilly. (TPWD Website)
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A map of this region is available on the Texas Parks and Wildlife website.
Wildlife management practices are described in Guidelines for Qualification of Agricultural Land in
Wildlife Management Use (Texas Comptroller, July 2002) and the Comprehensive Wildlife Management
Planning Guidelines(TPWD,July 2007)for the Eco region in which the property is located.
The chief appraiser,with the advice and consent of the Appraisal District Board of Directors, designated
the percentage devoted to wildlife management based on the percentage developed for each Eco region.
The percentages for Region 6; Cross Timbers and Prairies as determined by the Texas Parks and Wildlife
Department are: at least 93%but not more than 95%. Denton Central Appraisal District's percentage is
93%. The following formula is used to determine the number of acres that are required for approval of
the wildlife management: (x-1)/x=wildlife use requirement.
Where "x"represents the number of acres in the application.
Example would be (20 acres—1)/20 acres= 95%. In this example the acreage would qualify.
Another example would be (13 acres—1)/13= 92.8%. In this example the acreage would not qualify.
Using 93%as the minimum and the formula prescribed,the minimum number of acres that would qualify
for wildlife management for Denton CAD would be slightly less than 14.50 acres.
Existing properties in wildlife management are grandfathered and not affected by the adoption of the new
Comptroller's Rule 9.2001. Properties receiving wildlife management under the old Comptroller's Rule
will not be affected unless the property owner sells part of the land and the remaining acres do not meet
the requirements of the new Rule 9.2001.
B. Qualification for agricultural appraisal wildlife mana emmeent
DCAD requires that a wildlife management form be filed along with a 50-129 for the conversion of the
land into wildlife management. All applications and annual reports are date stamped as soon as the district
receives them. The information is first scanned into the system by a data clerk, and then filed by school
district in a filing cabinet for appraiser review. Then the agricultural appraiser, supervisor, or the appraiser
that works that school district can pull the forms for that area and go work them. During field inspection
we look to see if the activities on the property matches what was described on the management plan.
1. A wildlife management plan should be completed on the form(WMP)prescribed by Texas
Parks and Wildlife Department for each tract of land for which qualification for agricultural
appraisal under wildlife management is requested. The chief appraiser may not require that
the property owner use the WMP form but all required information must be provided. (A
copy of the wildlife management and wildlife management annual report form can be found
at Denton Central Appraisal District(DCAD) or DCAD's website; www.dentoncad.com, or
the Texas Parks and Wildlife website;
www.tpwd.state.tx.us/landwater/land/private/agricultural land/.)
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2. The property must have been receiving 1-d-1 Open Space for agricultural use under section
23.51 (1).
3. The property must be used in 3 out of the 7 listed wildlife management practices. Property
must be actively managed to sustain a breeding,migrating, or wintering population of
indigenous wildlife.
a. Habitat control;
b. Erosion control;
c. Predator control;
d. Providing supplemental supplies of water;
e. Providing supplemental supplies of food;
f. Providing shelters; and
g. Making of census counts to determine population;
4. The number of acres in the application must meet the required amount based on the
calculation using the formula prescribed.
C. Inspections of wildlife management applications and annual reports
The chief appraiser may request an annual report be filed on any properties approved under wildlife
management. A copy of the form can be located on our website at(www.dentoncad.com)and links to the
other related agencies are also available there as well.
The procedures for inspecting an application for wildlife management or an annual report are the same as
the application for 1-D-1 agricultural appraisal. Visual inspections are done on all properties when an
application has been filed. The appraiser views the property,makes notes based on the inspection and
takes a photograph of both the qualifying property and the properties determined to be denied. The
applications,appraiser's field notes and photographs are scanned to the account. Those properties that are
approved receive a letter stating the approval. Properties that have been denied receive a letter denying
the application,the reason for the denial, and an explanation on how to protest the denial.
Part D. Residential Properties (Improved Properties and Vacant Residential Lots)
2.31 Introduction
A. Definition of Appraisal Responsibility
The Residential Department of the Denton Central Appraisal District(DCAD)is responsible for
developing fair and uniform market values for residentially-classed improved properties and for vacant
residential lots. There are approximately 210,000 improved residential properties in Denton County.
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Required education,under section 5.04 of the Texas Property Tax Code,is achieved by attending courses
developed through the Texas Comptroller's Property Tax Division and licensing through the Texas
Department of Licensing and Regulation(TDLR). Continuing education is achieved by attending in-
house training, classes held by TAAO, TAAD,Dallas Central Appraisal District, Tarrant Appraisal
District, and any other sources available for the district to use.
B. Legal and Statutory Requirements
The provisions of the Texas Property Tax Code (TPTC)and relevant legislative measures involving
appraisal administration and procedures control the work of the appraisal district. The district is
responsible for estimating the market value of each property, as of January 1, for ad valorem tax purposes.
The district is required to periodically reappraise all real property at least once every three years. DCAD
reappraises real property each year. IAAO Standards on Mass Appraisal 3.3.4
C.Administrative Requirements
An appraisal management policy should reflect regulatory obligations, mandate due diligence,
ensure conformance to professional standards, generate current and meaningful valuations, and
establish criteria for a thorough review process. DCAD subscribes to the standards of the
International Association of Assessing Officers (IAAO) and to the standards promulgated by the
Appraisal Foundation known as the Uniform Standards of Professional Appraisal Practice(USPAP)
regarding its appraisal practices and procedures. (Refer to copy of USPAP manual on file at the Denton
Central Appraisal District.) Residential Department submits an annual budget to the Deputy Chief
Appraiser. The department is responsible for completing mass appraisal assignments in a timely manner,
within the cost constraints of said budget.
D. Appraisal Resources
Personnel - The Residential Department staff consists of a manager,two supervisors,three senior
appraisers,thirteen field appraisers each assigned to geographic areas. One senior administrative support
position and six support clerks. The manager reports to the Deputy Chief Appraiser.
Data - A common set of data characteristics for each residential dwelling in Denton County is collected
in the field and data entered to the DCAD mainframe computer. The property characteristic data drives
the computer-assisted mass appraisal approach to valuation.
A common set of data characteristics for each land account in DCAD is collected and data is entered to
the DCAD mainframe computer. Information on sold properties is reviewed by calling to the purchaser
or seller,visual inspection,using GIS and aerial photography. Sales are plotted on the map to review
location, access, and topography of the sold land. The property characteristic data drives the computer-
assisted mass appraisal approach to valuation.
Data-The data used by the Residential Department includes verified sales of improved properties and
vacant lots and the pertinent data obtained from each(sales price levels, income multipliers, land to
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building ratios, etc.). Another example of data used by the department would be rental information. This
information will be used to determine a gross rent multiplier.
In addition to the actual data obtained from specific properties,market data publications are also reviewed
to provide additional support for local and regional market trends, such as:
• Tierra Grande(Journal of the Real Estate Center at Texas A&M University)—Provides
information on land around the state.
• Texas Farm&Ranch(Catalogue of Fine Rural Real Estate)—Provides information on high dollar
farm and ranch property.
• Fair&Equitable IAAO).—Provides information on appraisal and assessment offices throughout
the U.S. and Canada.
• DuPont Registry—Provides information on high end homes throughout U.S.
• Marshall& Swift Exceptional Homes—
• Marshall& Swift Home Repair and Remodel—
• N.A.D.A—Provides
• Realty Trac—
• Marshall& Swift Residential Valuation—
• Marshall& Swift Commercial Valuation-
• National Association of Independent Fee Appraisers(NAIFA)
Information Systems - The mainframe systems are augmented by the databases that reside as various
applications on the DCAD Local Area Network(LAN). DCAD offers a variety of systems for providing
property owners and public entities with information services. Appraisal Support fields many of the
public's questions or redirects them to the proper department. PC stations are located in the customer
service area for the public's use. Access to the district's appraisal data is also available through the
appraisal district's website,www.dentoncad.com.
2.32 Valuation Approach (model specification)
Improved Residential Properties
A. Area Anal
Data on regional economic forces such as demographic patterns,regional location factors,employment
and income patterns,general trends in real property prices and rents,interest rates trends,availability of
vacant land,and construction trends and costs are collected from private vendors and public sources.
Information is gleaned from real estate publications and sources such as real estate professionals,Dallas
Business Journal,Marshall& Swift, IAAO, Texas A&M Real Estate Department,Realty Trac,National
Association of Independent Fee Appraisers (NAIFA), foreclosure listing and applicable sources found on
the Internet such as;realtor.com. Monitoring this helps to give the appraisal staff a current economic
outlook on Denton County's real estate market. The residential department analyzes collected information
described above in its analysis of defined subdivision/neighborhoods and geographical areas. The district
routinely inventories properties in the appraisal district either through on-site inspections,the use of
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district aerials,and in limited cases the use of recent photographs of the property. (Aerials are provided
from COG and from Pictometry, each flown every other year.)
B.Neighborhood Analysis
Market areas are defined by Neighborhoods (the Residential Neighborhood list is available upon request
at Denton CAD). Neighborhoods are defined as groups of properties that exhibit similar characteristics
such as size, age, construction quality,market area,value range, and other characteristics that affect
value.Neighborhood groupings are designed to allow properties that are similar to be analyzed together.
Physical and legal boundaries may be starting points for delineating neighborhoods,however;ultimately
the appraiser should use good judgment in determining if the properties in that neighborhood grouping are
of a similar nature.
Neighborhood codes and classifications will utilize a coding system to identify the primary entity it
resides in. For example: a neighborhood code of DC05001 would indicate that the property is located
within Denton County("D"),within a city limit("C"), City of Denton("05"), and then the numerical
code for that neighborhood("001"). The numerical code for the neighborhood code is simply an
identifier,there is no attribute associated with the code.
Neighborhood analysis involves the examination of how physical,economic, governmental and social
forces and other influences affect property values. The effects of these forces are also used to identify,
classify, and organize comparable properties into smaller,manageable subsets of the universe of
properties known as neighborhoods.
Neighborhoods are defined by grouping properties based on having similar market preferences and
influences. Generally speaking,many neighborhoods will have physical boundaries that define their
perimeter such as major roads, as well as land features such as creeks, greenbelts,golf courses,etc. some
neighborhoods will be delineated based upon other factors such as construction quality, age, and other
structure related factors. Sales and income information are gathered on each neighborhood area and used
to formulate overall appraised values for that neighborhood
C. Highest and Best Use Anal
For the vast majority of residential properties,the current use will be the properties highest and best use
(HBU). Unique properties located in areas of transition will need additional research and analysis to
determine HBU and valuation methods that are in compliance the Texas Property Tax Code.Appraisers
need to be aware of HBU limitations regarding Homestead Properties.
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2.33 Data Collection/Validation
A. Data Collection Manuals
Field data collection requires organization,planning, and supervision of the field staff. Data collection
procedures have been established for land,residential, commercial,and personal property. An appraisal
manual and a residential procedure manual for the district is published and distributed to all appraisers
involved in the appraisal and valuation of residential properties. Both manuals are reviewed and revised
to meet the changing requirements of field data collection. Field appraisers use these manuals during
their initial training and as a guide in the field inspection of properties. The residential appraisal manual is
updated annually and procedure manual as needed.
B. Sources of Data
The district's property characteristic data was originally received from the ISD's,Denton County Tax
Office as well as the surrounding cities. And where absent, collected through a massive field data
collection effort coordinated by the district over a period of time. The appraisal support position within
the residential department collects new and miscellaneous construction permit data through onsite visits
to each city permit office. Information on new home starts in the rural areas is gathered from the Denton
County Health Department, septic permit and through the use of mechanics liens. New home starts,
remodeling, living additions and other permit-required improvements are also discovered through field
inspection. Still the main focus is on field inspection and visual review. Tax assessors, city and local
newspapers, and the public often provide the district information regarding new construction,market
patterns, and other useful facts related to property valuation. Aerial photographs are also sometimes used
to find hard to locate improvements.
C. Data Collection Procedures
Field data collection requires organization,planning, and supervision of the field staff. Data collection
procedures have been established for residential, commercial,and personal property. Appraisers conduct
field inspections and record information on an appraisal card or on their IPad. It is this information
collected by the appraiser that is entered into the district's computer system and serves as the basis for the
valuation of real property.
In addition to field inspections, DCAD utilizes the YOTTA Sketch Verification program,which compares
the PACS building sketch to the most recent aerial photograph of the building. Appraisers' field
inspection finds discrepancies and makes corrections as necessary.
The DCAD boundaries are divided into geographic areas with each appraiser assigned an-area for which
they are responsible for data collection. The residential department conducts periodic meetings where
each appraiser gives a verbal report of their work progress. Additionally, each appraiser's work is
reviewed by the appraisal supervisor before it is given to appraisal support for data entry. These
procedures are an important tool in analyzing future departmental staffing needs,as well as showing each
individual appraiser's progress and error rate. While production standards are established and upheld for
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the various field activities,quality of data is emphasized as the goal and responsibility of each appraiser.
New appraisers are trained in the specifics of data collection set forth in the appraisal manual as
procedures to follow. Experienced appraisers are routinely brought up to date on changes in procedures
prior to major field projects such as new construction, sales validation or data review. The Residential
department manager routinely reviews the work being performed by all the field appraisers. The
department manager is also charged with the responsibility of ensuring that appraisers follow listing
procedures, identify training issues and provide uniform training throughout the appraisal staff.
2.34 Class System
A class system for residential properties has been developed to help ensure appraisal uniformity. The
residential class system currently consists of classes 1 through 5C for frame homes and 6 through I IC for
brick, stucco, etc. Some classes have a corresponding"E"class. The exceptions for"E"are additional
refinements in material and workmanship. Classes are based on types of construction and finish out.
When classing a particular property,the appraiser will choose a class which best meets the defined
descriptions of quality, and workmanship.
The different classes will reference the computer to cost tables developed from the Marshall Valuation
Service,which is an appraisal guide for developing replacement costs for a wide range of construction
quality levels. Marshall Valuation Service software utilizes the comparative unit method to derive a cost
per unit for the structure being appraised. Typical building specifications are developed for each quality
level,which are used to determine the base cost of benchmark structures. Once the benchmark base costs
are in place, construction costs for each class at various size increments are developed. Adjustments for
variations from base cost specifications are also developed for each class. And finally, local modifiers are
used to make the cost data applicable to Denton County,these local modifiers are referred to as
"Neighborhood Factors". The DCAD also collects actual cost data from local developers and property
owners. Whenever possible, actual costs are compared to Marshall Valuation Service costs. If there are
inconsistencies between the two costs,adjustments will be made to the appropriate DCAD classes.
Actual local costs are given more weight than Marshall Valuation costs in these circumstances. If, in the
appraiser's judgment,the cost tables do not fit the property being appraised,but that property does fit into
a class,the appraiser should class the property by the class that most resembles that property. The
computer system will allow the appraiser to override the tables and enter the cost value he deems correct.
All residential class costs are updated annually,based on data that is published closest to January 1.
Classes cannot be established for every residential property within Denton County. A small percentage of
the properties will require special pricing by the appraiser. This can be accomplished either by use of the
Marshall Valuation Service or flat pricing. Each of these two methods requires that the appraiser utilize
his or her best judgment on items that are too infrequent or unusual to fit efficiently into the present class
system. The appraiser should consult with either their supervisor or department manager if uncertain
about cost methods for unique properties.
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Sales ratio reports and Marshall and Swift cost manuals are used to review cost manuals each year. Class
8 homes are considered the benchmark class then the class 9's. Ratio reports are ran on both classes to
determine whether changes need to occur in the pricing. All other classes are reviewed in the same
manner however; class 8's and 9's general indicate the general direction of the changes. The lower class
frames, classes 1,2, and 3 are reviewed using Marshall and Swift since sales of these properties limited.
2.35 Valuation and Statistical Analysis (model calibration)
The Residential Department is responsible for estimating the market value for all residential improved
and vacant lots. Provisions of the Texas Property Tax Code(TPTC)and relevant legislative measures
involving appraisal administration and procedures control the work of the appraisal district. The district is
responsible for appraising property on the basis of its market value as of January 1 for ad valorem tax
purposes for each taxing unit that imposes ad valorem taxes on property in the district. DCAD reappraises
property on an annual basis.
A. Cost Approach
The cost approach to estimating value is the most common approach used for mass appraisal of residential
properties because it can be applied to all improved properties. The cost method combined with the
market approach will provide the most broad based valuation tool possible for a wide range of
applications. However,the appraiser must always be conscious of the difference between cost and value.
Because of this difference,the appraiser must exercise judgment when measuring applicable depreciation.
For the cost approach, a class system based on construction quality has been programmed into the
computer. The cost figures for each class were taken from the Marshall Valuation manual,with
modifications to reflect the Denton County market. A description of each class, and the quality levels in
which that class can be found, is included at the end of this section. All DCAD residential cost schedules
are evaluated and updated on an annual basis by the department manager.
The uniqueness of some properties will necessitate use of the unit-in-place or segregated cost method.
The appraiser will manually make the calculations using the Marshall Valuation Manual and enter the
figures directly into the computer. If the appraiser can get actual costs on new construction,he can use
those costs in the cost approach. Care must be taken to ensure that any costs provided represent actual
total costs. Cost can be defined as the total expenditure necessary to construct an improvement and place
it in the hands of the consumer. The appraiser may use actual new construction costs,as long as those
figures represent actual total costs. In other words,the appraiser must make sure all indirect costs, as well
as direct costs,are included. This will require a detailed breakdown of the submitted cost information.
Summarized costs provided by tax consultants or taxpayers should be avoided unless substantial support
for those figures can be provided.
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The costs included in the Marshall Valuation Manual are the actual costs to the owner and include direct
costs (materials, equipment rentals,utilities,labor, and supervision), as well as indirect costs (plans and
plan check, site preparation, architectural and engineering fees,building permits,title and legal fees, and
interest and fees on construction loans). Indirect costs also include the contractor's profit and overhead,
which includes fire, liability and unemployment insurance, and workmen's compensation.
When classing a structure,the appraiser must first ascertain the quality of the structure because the
majority of DCAD classes are based on construction quality levels and amenities. The quality levels used
in the DCAD residential class system can be grouped into three distinct levels: tract, custom, and luxury
grade construction. Construction quality can be difficult to determine in buildings where the importance
of appearance and amenities is equal to or greater than the importance of pure utility. It is usually true
that a well-framed building is a well-finished structure. And it is also true that if a builder cuts corners on
framing,he will probably also cut corners on finish-out and mechanical equipment. If an appraiser is
having difficulty in determining the quality level of a building,he should refer to the DCAD and/or
Marshall Valuation Manual for guidance.
The final step in the cost approach is to establish the level of depreciation experienced by the
improvement. Depreciation occurs in three forms:physical, functional, and economic.
Physical deterioration is the loss in value due to the wear and tear of the property. The DCAD utilizes the
Marshall Valuation Service residential depreciation tables to measure physical deterioration. These tables
are a modified version of the overall Age-Life method. Whereas the Age-Life method assumes that a
building depreciates by a constant percentage over its economic life,the Marshall Valuation tables
recognize that a building is in the prime of life up until mid-life. This non-linear approach accounts for a
slower depreciation rate in the early years as compared to the later years when diminishing serviceability
and higher maintenance can accelerate depreciation. As part of the physical depreciation analysis,the
appraiser should consider the"effective age"of the building. The effective age of a building is its actual
age,less the age which has been taken off by structural face-lifting or reconstruction,removal of
functional inadequacies,updating of equipment, etc.
Functional obsolescence is the overall usefulness and desirability of a property. Functional obsolescence
is the loss of value in a property improvement due to changes in style,taste,technology,needs, and
demands. It exists where property suffers from poor or inappropriate architecture,poor floor plans,room
sizes, etc. In these instances,buyers perceive a loss in utility;therefore,the price offered is lower due to
reduced demand.
Economic obsolescence(or external obsolescence)is the loss in value caused by outside forces such as in
the highest and best use of a property due to market shifts or governmental actions,restrictions on
income,zoning,neighborhood decline,etc. This can influence both land and improvements.
Field inspection is required for the analysis and measurement of all forms of accrued depreciation. The
appraiser should consider all conditions that diminish utility and estimate their combined effect on market
value. Physical depreciation, functional and economic obsolescence,and effective age are also influenced
by competition and market conditions. The appraiser,therefore, should also analyze the income and sales
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of comparable properties when deciding on a measurement of accrued depreciation. All forms of
depreciation are expressed as a percent good.
Once the estimated depreciated improvement value is determined,it is then added to the land value
resulting in an estimated total property value. The cost approach is used as a comparison to the market
schedules.
The cost schedule,based on construction of similar improvements, is developed from information
gathered from reliable sources such as Marshall& Swift, a national publication of building cost; and local
builders, local suppliers and any other sources considered reliable. The cost approach consists of
calculating the replacement cost new for each improvement and then deducting for normal depreciation.
The causes of accrued depreciation fall into three general categories: physical deterioration,functional
obsolescence,and external(economic) obsolescence. Physical deterioration and functional obsolescence
are inherent in the property itself,whereas external(economic) obsolescence is the result of outside
forces.
Physical deterioration is the loss in value due to the wear and tear of the property. There are curable and
incurable forms of physical depreciation. It depends on whether the value added by curing them exceeds
the cost to cure (it is not economically prudent to cure the condition). Effective age is the number of
years of age of the improvement as indicated by its condition. If the improvement has been well
maintained, its effective age may be less than the actual age; if there has been poor maintenance, it may
be greater. The appraiser based on inspections determines this.
Functional obsolescence is the overall usefulness and desirability of a property. Functional obsolescence
is the loss of value in a property improvement due to changes in style,taste,technology,needs, and
demands. It exists where property suffers from poor or inappropriate architecture,poor floor plans,room
sizes, etc.
Physical depreciation tables are taken from Marshall& Swift. Each of the different classes of homes are
tied to different depreciation tables. The CAMA software applies the amount of depreciation based on
either the actual age of the property or the effective age. The effective age of the structure is determined
by the appraiser based on onsite inspects of the property.
External obsolescence is the loss in value caused by outside forces such as in the highest and best use of a
property due to market shifts or governmental actions,restrictions on income,zoning,neighborhood
decline, etc. This can influence both land and improvement.
Once the estimated depreciated improvement value is determined it is then added to the land value giving
an estimated total property value. The cost approach is used as a comparison to the market schedules.
V=LV+(RCN—D)
(Value=Land Value+(Replacement Cost New—Depreciation)
$142,084= $22,297+($140,150—23%)
103
B. Market Approach
The market approach to value is the preferred method for residential properties because they sell
frequently and have a high degree of similarity within neighborhoods and market areas. The market
approach provides the most accurate representation of value in an active real estate market. If and when a
market becomes stagnant,or there are too few sales to create a comparable sales model, it may be
necessary to utilize one of the other methods, including the cost approach.
When using the market approach,the appraiser should take care to assure that the sales price is the total
consideration given for the property. This is important because residential properties can include special
financing arrangements, closing costs,points, etc. For example,many sales can include significant
closing costs. It is important to determine what is "typical"for the neighborhood or market. If these sales
are used in ratio studies,the value of the special financing,points, closing costs,personal property, etc.
must be estimated and subtracted from the sale price in order to determine the purchase price for the real
property alone if the inclusion of those items is considered non-typical for the market. Personal property
consists of furniture, fixtures,machinery, equipment, etc. Appraisers should scrutinize each sale for these
items, estimate their market value, and deduct it from the total purchase price. If the financing or
personal property component of a sale cannot be estimated,the sale can be excluded from ratio studies.
The appraiser should gather as many details as possible on any sales he may collect to allow that
information to be used in the future as comparable sales.
Pertinent data from actual sales of properties,both vacant and improved, is pursued throughout the year in
order to obtain relevant information that can be used in all aspects of valuation. For example, sales of
similarly improved properties can provide a basis for setting benchmarks for the market area. Improved
sales are also used in ratio studies,which afford the appraiser an excellent means of judging the present
level and uniformity of appraised values.
C. Sales Information
All sales information collected is the responsibility of the Sales and Research Department. Residential
improved and vacant land sales are collected from a variety of sources including,but not limited to,
district questionnaires sent to buyer and seller,field discovery,protest hearings,Roddy Report,builders,
real estate professionals, and fee appraisers. A system of type, source, and validity codes was established
to define salient facts related to a property's purchase or transfer. Neighborhood and ISD sales reports are
generated as a tool for the appraiser in the development of value estimates. Sales information is stored in
the mainframe database.
A system of type, source, and validity codes are established to define salient facts related to a property's
purchase or transfer(see type codes and validity codes below). ISD,neighborhood, and subdivision sales
reports are generated as an analysis tool for the analyst in the development of value estimates. Sales
information is entered into the sold account to generate a sales ratio. (DCAD estimate of market value
divided by purchase price equals ratio.)
104
TYPE CODES VALIDITY CODES
o A Appraisal I Invalid
o C Confidential Sale V Valid
o Cl Confidential Imp Sale
o CISRT Confidential Imp Short Sale
o CL Confidential Land Sale
o F Foreclosure
o FCI Confidential Foreclosure Imp Sale
o FCL Confidential Foreclosure Land
o FI Foreclosure with Imp
o FL Foreclosure Land
o I Improvement Sale
o IPC Partial Complete Imp
o ISRT Imp Short Sale
o L Land sale
o M Miscellaneous Addition
o P Pooladded
o Q Questionable
The first phase involves subdivision/neighborhood ratio studies which compare the recent sales prices the
appraised values of those properties that have recently sold. This set of ratio studies affords the appraiser
an excellent means of judging the present level of appraised value and uniformity of the sales. In
reviewing the sold properties the appraiser makes a determination as to the validity of the information.
Foreclosed properties are used in our analysis,but if the neighborhood has more arms' length sales than
foreclosures the appraiser may determine that one foreclosure does not carry much weight. If the analysis
determines that foreclosures are the norm in the neighborhood the appraiser needs to research the sale and
determine the conditions of the foreclosure. Some foreclosed properties have been found to have the
interiors striped of fixtures and appliances. Any sales that have been determined to be outside of a normal
transaction or trend are recoded as"I"invalid.
D. Income Approach
The income approach to value is applied to those real properties which are typically viewed by market
participants as"income producing,"and for which the income methodology is considered a leading value
indicator. Because single family residences are typically owner occupied,the income method is generally
the least used method of the three approaches. DCAD obtains rental rates for housing to develop Gross
rent Multiplier(GRM)rates for areas that have rental properties. GRM rates will vary widely, and will
require a substantial amount of information about the subject and comparable to be considered accurate.
Because the DCAD computerized program utilizes the direct capitalization method,the GRM will be
performed manually by the appraiser as needed.A discussion of the income approach is provided for
properties where the income method is applicable.
105
E. Statistical Analysis
The appraisers in the Residential Department perform statistical analysis annually to evaluate whether
values are equitable and consistent with the market. Ratio studies are conducted on each subdivision,
neighborhood and ISD to judge the two primary aspects of mass appraisal accuracy--level and uniformity
of value. Appraisal statistics of central tendency and dispersion generated from sales ratios are available
for each subdivision and/or neighborhood within an ISD and summarized. These summary statistics
include,but not limited to,the median,the mean,the weighted mean, standard deviation,coefficient of
dispersion(COD), and coefficient of variation(COV),provide the analysts an analytical tool by which to
determine both the level and uniformity of appraised value of a subdivision and/or neighborhood basis.
The level of appraised values can be determined by the weighted mean for individual properties within a
subdivision/neighborhood,and a comparison of subdivision/neighborhood weighted means can reflect the
general level of appraised value between comparable subdivision/neighborhoods. Review of the standard
deviation, coefficient of dispersion and the coefficient of variation can discern appraisal uniformity within
and between subdivision/neighborhoods.
Pac software allows the appraiser to pull in information about all of the properties within a neighborhood
includes but is not limited to; class, depreciation,year built,land size,and land value can be looked at for
equity. The appraiser is able to sort the information in many different ways to look for problems,trends,
equity, and anything else that shows itself.
The profiling feature gives the appraiser quick information on the neighborhood based on the sold
properties. See example below:
Neighborhood Profile:(DC05264
General I Run Detail I Class Breakdown I Improved Vacard iSales Ratio Chart inked Profiles Anah�sis
Profile Run 6856 Profile Detail 259340
Appraisal Year 2018 Current Updated Adjustments
Neighborhood THE Mean Ratio 98.20:t 1D0.13' Mean 1.26
PRESERVE AT Weighed Mean 98.03:: 99.96%: Median 1.25
Median Ratio 98.074 100.025.
NBHD Code DC05264 Calculated 1.25
Avg SalelAppr 5310,154 5310,039
Sample Size 1 A,vg SaleiAppr PSF 5109.53 $108.91 Target Ratio 1100,00
Sample Percent 16.30%� Related Dill 1.D0 1.00
Population 687 New Adj
C of D 0.0535 0.0535
Old NBHD Ad! 1.22
Avg Land/Sale 19.86%e Status:Locked by user Jacqui.Dunworth on ApplY N—
Outlier Property... Sale Date Sale Price Rev Appr T... A Rev R... Land Rev Imp
301539 3/3/2017 S215,700 S223,434 1748 103.59% 550,337 5173.097
220994 11/30/2017 5225,15M 5226.705 1751 100.76i. 551,750 5174,955
682961 6/21/2017 5240,57D 5241,294 1799 100.30% 553,040 5188,254
6828W 12/22/2017 S260.000 $238,927 1801 91.90> S51,DD0 5187.927
682937 11/17/2017 S275.750 S242,074 1809 87-79" 553.040 S1a9,034
301494 7/10/2017 5237.500 $245,094 1833 103.20%e 563,9D9 5181,185
301489 12/11/2017 5244,000 5238.446 1837 97.724 553,712 5184,734
rn - -
Filter Sample Properties Print Poevrew... =-°r
GIS OK Cancel �pN
106
Pmview
1 of 1 t 100% Tatal:112 100% 112 of 112
MEN—
Residential Neighborhood Analysis
Profile Run 6856 Profile Detail 259340
Previous L' ated
NBHD Code DC05264 Mean Ratic 9810% 100.13% Adivatments
Neighborhood THE PRESERVE Weighesd Mean 98.03% 99.969a Mean 1.:6
ATPEC:'�\CREEK MedianRato 98.07% 100.029: Median 1'5
Sample— 112 Avg Salt Appr S310,154 SHUN
Samplepercent 16.30% AtgSaleApprPSF S10953 S108.91 Calculated 1.25
Population 687 Price RelatedDiff 1.00 1.00
Old NBHD Adi 1.2.2 Coefficient of Dispersion 0.0535 0.0535
AvgLand.Sale 19.86%
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107
Neighborhood Profile: (DC05264)
General I Run Detail Class Breakdown I Improved Vacant 71 Sales Ratio Chart I Lnked Profiles I Analysis
Improved Properties
Feature Num Low Hrgh Median Average COD 00V
MA(Main Area}: 16% 4548 2845 2908 21.434: 25.483
Market: 687 92732 433574 30%51 304541 15.059, 18.176!
Market:,'MA: 687 27.91 145.62 108.83 107.69 10.61% 14.694.
Land.''Market 687 .1369 .7480 .2045 .2112 13.811: 25.1421
Improved Sales
Feature Num Low High Median Average COD COV
Sale: 112 215700 4250DO 304371 310154 13.625: 16.07Z
Sale.40A: 112 78.92 152.43 107.75 109.53 12.475i 15.141,
'Sale Market.,IVIA: 112 86.57 134.13 108.35 108.91 9.4012! 11.6271
tvlarket:,'Sale 112 .87787 1.16822 1.00021 1.OD127 5.35281 6.6555!
Monthly GRNIs 0 .00 .00 .00 .00 .01)000 .00000
Annual G I tvis 0 .00 .00 .00 .00 .00000 .00000
GIS OK I Cancel AH
There are also several options within the software(as shown above)used to help the appraiser locate
possible trends and or bias in the sold properties. The information includes,but is not limited to,
location, square foot, classifications, age and depreciation, and any sales data. This is usually done by
subdivision/neighborhood and then analyzed for inequality within the given data.
Analysis is also conducted by downloading information from the district's CAMA software to excel
spreadsheets using the querying functions in the CAMA software. The appraiser,based on the sales ratio
statistics, analysis derived from Pacs software and query information to a spreadsheet,makes a
preliminary decision as to whether the value level in the subdivision/neighborhood needs to be re-
evaluated, or whether the value in the subdivision neighborhood is at a defendable estimated of market
value.
108
F.Market Adjustment or Trending Factors
Market adjustment factors are developed from appraisal statistics provided from ratio studies and are used
to ensure that estimated values are consistent with the market. The district's primary approach to the
valuation of residential properties uses a hybrid cost-sales comparison approach. This type of approach
accounts for neighborhood market influences not specified in the cost approach. The following equation
denotes the hybrid model used:
MV=LV+((CN-D)MA)
Market Value=Land Value+ ((Cost New—Depreciation) Market Adjustment)
$142,084= $22,297+(($140,150—23%) 1.11%)
Where the market value equals the land value plus the replacement cost new less depreciation time market
adjustment factors. As the cost approach separately estimates both land and building values and uses
depreciated replacement costs,which reflect only the supply side of the market,it is expected that
adjustments to the cost values are needed to bring the level of appraisal to an estimate of market value.
If the subdivision/neighborhood is to be updated,the appraiser uses a ratio study that compares recent
sales prices of properties within a delineated subdivision/neighborhood with the properties' appraised
value. The calculated ratio derived from the sum of the sold properties' appraised value divided by the
sum of the sales prices indicates the subdivision-neighborhood level of value based on the unadjusted
value for the sold properties. This comparison of appraised value-to-sale ratio determines the market
adjustment factor for each subdivision/neighborhood. This market adjustment factor is needed to trend
the values closer to the actual market evidenced by recent sales prices within a given subdivision-
neighborhood. The market adjustment factor calculated for each updated subdivision-neighborhood is
applied uniformly to all properties within a neighborhood and as needed in the subdivision. Once the
market-trend factors are applied, a second set of ratio studies is generated that compares recent sale prices
with the proposed appraised values for these sold properties. From this set of ratio studies,the appraiser
judges the appraisal level and uniformity in both updated and non-updated subdivision-neighborhoods,
and finally, for the school district as a whole.
2.36 Individual Value Review Procedures
A. Field Review
Property field inspections may be initiated for a variety of reasons. A property owner might dispute the
district's appraisal attributes or data concerning his property. Typically, a new field check is then
requested to verify this evidence for the current year's valuation or for the next year's valuation.
Additionally, if a building permit is filed for a particular property indicating a change in characteristics,a
field check is then scheduled for that property. Finally, even though every property cannot be inspected
each year, each appraiser typically designates certain segments of their area of responsibility to conduct
field checks.
109
Residential appraisers are somewhat limited in the time available to field review all residential properties
in a given area. Still, a major effort is made by appraisers to field review properties and economic areas
experiencing large numbers of remodels,renovations,rental rates,new construction, or wide variations in
sale prices. Additionally,the appraiser frequently field checks subjective data items such as class, quality
of construction, condition,and physical, functional and economic obsolescence factors contributing
significantly to the market value of the property. Sometimes field reviews are warranted when sharp
changes in sales quantity and price levels occur between building classes or between market areas.
Appraisers also physically inspect sold and unsold properties for comparability and consistency of values.
In addition to conducting field reviews on a priority basis as discussed above,the residential department
physically reviews all properties every 6 years as outlined in the IAAO Standard on Mass Appraisal. This
review could be either onsite or by current aerials. Residential department manager along with the
department supervisors determine the areas for onsite reviews each year.
Residential appraisers should present themselves in a polite and professional manner and be prepared to
deal with a variety of situations and personalities. Appraisers should always take the time to fully explain
the reason for their visit,and are required to carry DCAD issued photo identification badges and business
cards.
B. Office Review
Given the resources and time required to conduct a routine field review of properties,homogeneous
properties consisting of tract housing with a low variance in sales ratios and other properties having a
recent field inspection date are value reviewed in the office.Valuation reports comparing previous values
against proposed and final values can be generated for all residential improved properties. Previous
values resulting from a formal hearing protest and others from informal hearings are individually
reviewed to determine if the value remains appropriate for the current year.
Once the appraiser is satisfied with the level and uniformity of value for each subdivision-neighborhood
within his area of responsibility,the residential department manager and department supervisors review
the estimates of value. Although the value estimates are determined in a computerized mass appraisal
environment, appraiser review helps to identify value anomalies before the value is released for noticing.
2.37 Performance Tests
A. Sales Ratio Studies
The primary tool used to measure mass appraisal performance is the ratio study. A ratio study compares
appraised values to market values. In a ratio study,market values (value in exchange) are typically
represented by sales prices(i.e. a sales ratio study). Independent,expert appraisals may also be used to
represent market values in a ratio study(i.e. an appraisal ratio study). If there are not enough sales to
110
provide necessary representation, independent appraisals can be used as indicators for market value. This
can be particularly useful for real property for which sales are limited. In addition, appraisal ratio studies
can be used for properties that are by statute not appraised at market value,but reflect the use-value
requirement. An example of this is homesteaded,residential properties that are located in an area of
transition,that have a high likelihood of being sold or rezoned for commercial use. Sales ratio studies are
an integral part of establishing equitable and accurate market value estimates, and ultimately assessments
for taxing jurisdictions. The primary uses of sale ratio studies include the determination of a need for
general reappraisal;prioritizing selected groups of property types for reappraisal; identification of
potential problems with appraisal procedures; and, assist in market analyses.
Pursuant to Chapter 5, of the Texas Property Tax Code, and Section 403.302, of the Texas Government
Code,the Comptroller's Property Tax Division(PTD)conducts an annual property value study(PVS) of
each Texas school district and each appraisal district. As a part of this annual study,the code also
requires the Comptroller to:use sales and generally accepted auditing and sampling techniques;test the
validity of school district taxable values in each appraisal district and presume the appraisal roll values are
correct when values are valid; and, determine the level and uniformity of property tax appraisal in each
appraisal district. The methodology used in the property value study includes stratified samples to
improve sample representation and techniques or procedures of measuring uniformity. This study utilizes
statistical analysis of sold properties(sale ratio studies)and appraisals of unsold properties (appraisal ratio
studies) as a basis for assessment ratio reporting. For appraisal districts,the reported measures include
median level of appraisal,coefficient of dispersion(COD),the percentage of properties within 10%of the
median,the percentage of properties within 25%of the median and price-related differential(PRD)for
properties overall and by state category.
B. Limitation of Appraised Value on Homesteads
In 1997,the Texas Legislator,with the approval from the voting population enacted Section 23.23 of the
Texas Property Tax Code.
Section 23.23 provides that the appraised value of a residence homestead for a tax year will be limited to
the lesser of either its market value or the sum of the market value of any new improvements and 110
percent of the appraised value for the preceding year. If an appraisal district reappraise each year then
each year the property could be subject to the 10 percent limitation. If the district reappraise every 2
years then the increase would be as much as 20 percent and every 3 years it would be 30 percent. The
Denton Central Appraisal District does reappraise every year. In an increase market this procedure can
and will compound.
The limitation takes effect the following year after the first year that the residential homestead was
granted. The limitation expires on January 1 of the first year that neither the owner of the property when
the limitation took effect nor the owner's spouse or surviving spouse qualifies for the homestead
exemption.
111
Example: 1
Market Value for 2017 $150,000
Market Value for 2018 $175,000
Limited Assessed Value Calculation for 2018 $150,000 * 1.10=$165,000
Under these circumstances the market value is greater than the limited assessed value. The limited
assessed value would then become the value used for tax calculation.
Market Value for 2019 $190,000
Limited Assessed Value Calculation for 2019 $165,000 * 1.10= $181,500
Again the market value is greater than the limited assessed value. The limited assessed value would then
become the value used for tax calculation.
Example: 2
Market Value for 2017 $120,000
Market Value for 2018 $150,000
*** Pool added to roll for 2018
Limited Assessed Value Calculation for 2018 $120,000 * 1.10= $132,000+$10,000 (pool)_
$142,000
In this example a pool was added to the appraisal roll for 2018. The value of the pool is not subject to
the"homestead cap". The calculation for the limited assessed value is performed by using the 2017
value times 1.10 plus the value of the"new pool". In this example even with the added value of the pool
the limited assessed value is less than the market value. The limited assessed value would then be the
value used for tax calculation.
Market Value for 2019 $155,000
Limited Assessed Value Calculation for 2019 $142,000 * 1.10= $156,200
For 2019 the pool would now become part of the value calculation for the limited assessed value
"homestead cap". The market value was $155,000 for 2019 and the limited value is $156,000. Since the
market value is the lesser of the two,the market value would then become the value used for tax
calculation.
The value of any new improvements(new structures or the complete remodeling of the improvement)is
added after the calculation of the limited assessed value.
112
Example: 3
In this example the property is receiving the open space valuation on the land for the year 2018.
Improvement Value 2017 (House) $100,000
Improvement Value 2017 (Barns) $ 15,000
Land Homesite (1 acre) $ 7,500
Land Ag Use (19 acres) $ 2,090
Market Value of Land Receiving Ag Use (19 Acres) $142,000
Total Market Value $264,500
Total Assessed Value $124,590
Calculation of the limited assessment value for 2018
$100,000(house)+ $7,500(land homesite) = $107,500 * 1.10=$118,250 (Limited assessed value for
homesite)
$118,250(limited assessed value) +$15,000(improv.Non-homesite) + $2,090 (Ag Land)= $135,340
The limited assessed value for the portions receiving the homestead would be $118,250 adding in the
portions not receiving the homestead$17,090 equals $135,340.
113
Example: 4
Adding land to homestead by combining 2 accounts;
229442 Lt 27, Lot size 0.1716
Market Value for 2017 $392,586 Homesteaded account
229443 Lt 28, Lot size 0.3926
Market Value for 2017 $ 32,615
Total Combined Value for 2017 $425,201
Do not combine the land segments in the first year that the lots are combined. PID 229442 is the
current account and PID 229443 is deleted. Add a new segment line in the land for the size of lot 28
under the general tab. On the upper right hand side there is a box to click next to "ADD NEW TO HS
FOR" PACs will enter the year.
229442 Lt 27,28; Lot size 0.5642
Market Value for 2018 $422,942
2018 Market Value is less than 2017 Market Value there is no cap.
114
Example: 5
Adding land to homestead by combining 2 accounts;
41115 J. Smith Tr. 16, 1.00 acres
Market Value for 2017 $92,151 Homesteaded account
84168 J. Smith Tr. 17, 1.50 acres
Market Value for 2017 $ 37,849
Total Combined Value for 2017 $130,000 (on distribute) Appraised Notice$138,922
Do not combine the land segments in the first year that the lots are combined. PID 41115 is the current
account and PID 84168 is deleted. Add a new segment line in the land for the acres in TR 17 under the
general tab. On the upper right hand side there is a box to click next to "ADD NEW TO HS FOR" pacs will
enter the year. Improvement flag as New Value "Improv Detail"
41115 J. Smith Tr. 16& 17, 2.50 acres
Market value for 2018 Improv HS $ 80,486
Improv Non-HS $ 324 add to Homestead for 2018
Land HS $45,667
Land Non-HS $ 68,500 add to Homestead for 2018
Current market value for 2018 $194,977 Total Homestead value for 2018
2017 Market Value $130,000 * 1.10=$143,000
Limited Assessed Value Calculation for 2018 $143,000+$324+$68,500=$211,824
Cap Limit Calculation is higher than 2018 Market Value so there is no cap after combining accounts.
**FLAG THE ADDED IMPROVEMENT
115
2.38 Value Defense Procedures
The appeals process begins with an informal meeting between the appraiser and the property owner to
discuss any errors, discrepancies of market value and/or equity, and any claims of exemptions or special
valuations(agricultural use,restricted use value, etc.). The informal review may be handled by mail, in
person,or by telephone. The review allows for communication and mutual understanding,which will
reduce the number of formal appeals. Informal reviews should incorporate the following basic steps:
1) Verify the parcel information;
2) Exchange information;
3) Record the nature of complaint;
4) Use cost, sales, or income information to confirm property value;
5) If a value change is indicated,the appraiser will change the value and enter into a signed
agreement with the property owner;
6) If a value change is not warranted,the appraiser should explain the appeal rights and
procedures, in case the property owner wishes to make a formal appeal.
Residential appraisers must get written approval from the Residential Manager or Supervisors to settle
any property with an appraised value of$1,000,000 or higher.
Appraisal Review Board hearings(formal appeals) are the next step in the appeals process. Prior to the
hearing,the property owner should be given a copy of the evidence the appraiser plans to use in evidence.
The appraiser should be prepared to present factual information relating to the property, such as copies of
tax maps,pictures of the property, improvement drawings, etc.,as well as valuation information, such as
the cost,market, and income approaches to value as necessary. If there is an equity component to the
appeal,the appraiser should be prepared to present a reasonable sample of equity comparable based on
cost, sales,or income as appropriate.
2.39 Education and Training
All employees shall have the knowledge and expertise to do their job. Each employee will have a
minimum educational standard required for their position. In addition,DCAD will supply the following:
A. On the job training—each employee will receive training on procedures,policy,and
equipment by their supervisor and other employees in similar positions.
B. State required education and registration—all employees so required will achieve and
maintain their own educational and registration requirements.
C.Additional training and education—from time to time, additional training and education
will be required to enhance job performance,knowledge and expertise.
Employees will be expected to perform to a minimum standard.
116
Denton Central Appraisal District
Residential Department
Field Classification Guide
Revised January, 2014
Note: This manual is intended to be used as a guide. It is not intended to address individual
characteristics and the minor variations between similar properties.It is possible that structures may
have part or all of the features that are described in each class. Enhancements or detraction from the
cost schedule are handled individually.
117
Basic category groupings for classifications:
Class 1 } Basic, Low Cost Structure
Very Basic
Class 2 } Fair, Low Cost Structure
Class 3 } Average/Low Quality Tract Home
Individually Blt/
Class 4 } Above Average Quality Tract Home or Tract Home
Class 5 } Premium Quality Tract/Semi-Custom Home
Class 5A } Semi-Custom Home
Custom
Class 5B Semi/Full Custom Home
Class 5C } Full Custom, Luxury Home
Special Pricing } Highly Unique, Exceptional Quality, Luxury Estate
Some classifications have a corresponding"E" class. The "E" class has the same basic specifications. The
exceptions for"E" are additional refinements in material and workmanship. Ornamentation will be more
defined in some cases. Classes with the "E" are improved version of the class without the "E", but are not
worthy of being moved into a higher class.
Note: All Class Descriptions are adapted from the Marshal&Swift Residential Cost Handbook, 02009
Marshal&Swift,and Exceptional Homes, A Cost Guide for High-Value and Unique Residences, 02009
Marshal&Swift.
118
Class 1
Class 1 structures will be of low cost construction quality and materials. These structures will meet the
minimum standards for local building codes. Interior finishing will be plain and inexpensive and designed
for functionality,with little or no attention given to appearance.The exterior finish will be plain,with little
to no trim. Windows and doors will be of low cost grade to meet minimum building standards.
The interior of Class 1 structures will meet the minimum requirements for local building codes.All fixtures
will be of low cost quality and minimal in quantity.
Class 2
Class 2 structures will be of inexpensive construction quality designed and built typically for mass
production. Windows and doors will be inexpensive with little trim. The overall quality of workmanship
is below average, but not below building code standards. A class 2 house will meet minimum construction
requirements of lending institutions. The design will most likely be from stock plans.
The interior of Class 2 structures will be finished with inexpensive grade materials. Fixtures will be
inexpensive and sufficient in quantity for the application. Flooring will be of inexpensive, mass produced
quality. Interior trim will be minimal.
Class 3
Class 3 structures will be of average quality construction and materials. Most structures will be built as
standardized plans with minimal options, but could have additional refinements to the interior and
exterior. Doors and windows will be of average quality, mostly stock & widely available materials. The
overall quality of construction will be average. Exterior trim will have sufficient ornamentation, average
quality masonry design, and average quality fenestration.
The interior of a class 3 will be of average quality, using standard grade materials and workmanship.
Flooring will be of average,stock quality. Fixtures will be of average quality and quantity. Some rooms of
the structure may receive slight levels of enhancement with trim for appearance.
Class 4
Class 4 structures will be of above average quality construction and materials. Most structures will be
built as standard plans, and may be built with mass production construction techniques and methods.
Structures will have individual variances in the ornamentation and finish of the exterior. Roofing materials
will be of a moderately good quality weight and appearance. Structures will generally exceed building
code standards and requirements of lending institutions. Structure is best described as a good quality
tract home with individually selected standardized variations.
The interior of a Class 4 structure will generally be of above average quality. Interiors are well finished
with above average level of attention is given to interior refinements and detail. Flooring will be of good
quality materials. Ample amounts of cabinetry in kitchen area of good quality. Overall interior finish and
craftsmanship is of average to above average, and good quality.
119
Class 5
Class 5 structures are of high quality construction and materials. These structures will frequently have
individual attention to detail. Some structures will be designed from tract type construction plans that
may have multiple options and variations. Roofing material will be of good to high quality materials. This
class is best described as a high quality tract home, or individually designed structure with individual
options and ornamentation. The exterior of the Class 5 structure will have more attention to detail, and
will have different levels of ornamentation and fenestration.
The interior of Class 5 structures will be above average to high quality throughout. Flooring will be of high
grade materials. Interior ceiling height could likely to be greater than 8',with vaulted,stepped or cathedral
ceilings in some areas such as master bedrooms and main living areas. Hardware will be above average to
high quality. Crown molding or additional trim is likely to be present in main living areas, kitchens, and
master bedroom areas. Fixtures will be more than adequate, well placed, and above average to high
quality. Kitchens will have high quality cabinets with high quality hardware. Kitchens may include items
such as island counters, etc. Overall interior finish and craftsmanship is of high quality.
Class 5A
Class 5A structures are of excellent quality construction and materials. The term "excellent" is not to be
interpreted as "best" or "highest". These structures will be,for the most part, individually designed with
individual attention to detail. Some Class 5A structures will be built from a standardized builder plan, but
are likely to be modified to individual preferences.Class 5A structures are best described as a semi-custom
home with individually selected features that exhibit a level of uniqueness in their appearance. The
exterior of Class 5A structures will be of excellent quality, but not the highest or best quality. Roofing
materials will be of excellent quality, heavy-weight materials, and will occasionally include metal or
masonry-type material. High quality windows with high quality sash, and insulation features will be
standard. Non-masonry siding will be of high quality materials and installation.These structures will have
some custom ornamentation, excellent quality masonry work, and individually selected masonry styles.
The interior of Class 5A structures will be of excellent quality construction and materials. The term
"excellent" is not to be interpreted as "best" or "highest". Interior ceiling height for a Class 5A house is
likely to be 9 to 10 Feet. High quality interior doors and hardware will be standard. Vaulted, stepped or
cathedral ceilings in areas such as master bedrooms and main living areas will be common. Cabinetry will
be individually selected for the residence. Bedrooms will have spacious closets. Interior fixtures will be of
excellent quality, abundant, and well placed. Some fixtures may be unique in design. Kitchens will have
high quality cabinets with high quality hardware. Kitchen design may include items such as island
counters, wet bars, etc. Master Bath areas will be spacious, and may include separate tub and shower
areas. High grade plumbing fixtures will be standard.
Class 513
Class 5B structures are of excellent quality construction and materials, and are characterized by custom
quality workmanship and materials. These structures will be individually designed with significant
individual attention to detail. Class 5B structures will be built from a custom designed plan and will have
a high degree of customization to individual preferences. Class 5B structures are best described as a full
custom home that exhibits a high degree of uniqueness in appearance.The exterior of Class 5B structures
120
will be of excellent quality including high quality windows with high quality sash and high quality non-
masonry siding. These structures will have custom ornamentation including exposed wood, cast or cut
stone, high quality natural stone, etc. with excellent quality masonry work and individually selected
masonry styles. Some structures will utilize stucco or similar material. Roofing materials will be of
excellent quality, heavy-weight materials, and will occasionally include metal, clay tile, slate or other
masonry-type material. Roof design will typically have a moderately steep pitch with multiple ridges and
valleys.
The interior of a Class 5B structure will be of custom,excellent quality materials and construction.typically
interior ceiling height for a Class 513 house is 9 to 10 Feet. Interiors may likely have solid core doors with
high quality custom grade hardware. Interior finish will include custom textures for walls, high quality
crown molding, trim, and additional accent features. Vaulted, stepped or cathedral ceilings in areas such
as master bedrooms and main living areas are typical. Cabinetry and built in shelving will be individually
selected for the residence, and will have high quality finish and hardware.
Interior fixtures will be of custom grade quality, abundant,and well placed. Kitchens will have high quality
custom cabinets with high quality materials, finish, and hardware. Kitchen design will include items such
as island counters, wet bars, etc. Master Bath areas will be spacious, and may include separate tub and
shower areas. High grade plumbing fixtures will be standard. High quality, custom grade wood or tile
flooring will be standard. Stairwells for 2-story homes could have custom detailed banisters. Overall,the
interior of Class 5B home is of excellent quality materials, custom design, and excellent quality custom
workmanship.
Class 5C
Class 5C structures are of the highest quality construction and materials,and are characterized by custom
quality workmanship throughout the entire structure.These structures will be individually designed with
a high level of attention to detail. Class 5C structures will be built from an individually custom designed
plan and will have a high degree of customization to individual preferences. Class 5C structures are best
described as a full custom home with luxury features that exhibit a very high degree of uniqueness in
appearance. The exterior of Class 5C structures will be of the highest quality including highest quality
windows and doors with highest quality sash and highest quality non-masonry siding. Entry doors will be
custom designed with substantial detail and workmanship.These structures will have significant levels of
custom ornamentation including exposed wood, cast or cut stone, high quality natural stone, etc. with
the highest quality masonry work and individually selected masonry styles. Stucco type materials will be
common at this level of quality. Roofing materials will be of the highest quality, heavy-weight materials,
and will include metal, clay tile, slate or other masonry-type material. Roof design will typically have a
steep pitch with multiple ridges and valleys. Highest quality gutters and downspouts will be standard.
The interior of a Class 5C structure will be of the highest quality custom, luxury materials and construction
techniques. Normally the minimum interior ceiling height for a Class 5C house is 10 Feet. Many structures
will have ceiling height greater than 10 feet. Interiors could have solid core doors with the highest quality
custom grade hardware. Interior finish will include the highest quality custom textures for walls,
individually selected high quality crown molding, trim, and additional accent features. Vaulted, stepped
or cathedral ceilings in areas such as master bedrooms and main living areas are typical, ceilings will
typically have individually customized,and coffered/vaulted panel designs using the highest grade custom
materials. Cabinetry and built in shelving will be individually selected and of the highest grade materials
and include the highest quality custom hardware. Bedrooms will have spacious closets. Interior fixtures
121
will be of the highest quality and custom grade, abundant, and well placed. Kitchens will have the highest
quality custom cabinets with highest quality materials, finish, and hardware. Kitchen design will include
items such as island counters,wet bars,etc. Master Bath areas will be spacious, luxurious,and will include
separate tub and shower areas with the highest quality finish including custom designed vanities, lighting,
etc. Highest grade plumbing fixtures will be standard. Highest quality, custom grade wood or tile flooring
will be standard. Materials such as terrazzo, high grade marble, granite, or other luxury grade materials
are commonly used. Stairwells for 2-story homes will have custom designed and highest quality wood or
other materials used in banister construction. Overall, the interior of Class 5C home is of the highest
quality materials, custom, luxurious design, and the highest quality custom workmanship.
Class Special Price (SP)
Use of Special Price Class should be limited to residences that exceed the base cost of Class 5C by the
addition of extensive amounts of fixtures and accessories that are not covered in the basic cost
calculations for that class.
122
Denton Central Appraisal District
Residential Department
Field Classification Guide
Revised January, 2014
Beginning Use in 2014
Note: This manual is intended to be used as a guide. It is not intended to address individual
characteristics and the minor variations between similar properties. It is possible that structures may
have part or all of the features that are described in each class. Enhancements or detraction from the
cost schedule are handled individually.
123
Basic category groupings for classifications:
Class 6 } Basic, Low Cost Structure
Class 7
Low/Avg. Quality Tract Home
Class 8 Tract
Class 9 } Above Average/ High Quality Tract Home
Class 10
Premium Quality Tract/Semi-Custom Home
Class 10A
Custom
Class 10B } Full Custom Home
Class 10C
Full Custom, Luxury Home
Class 1013
Class 11
Class 11A Premium Quality Luxury Home
Luxury
Class 11B f
Class 11B&11C} Highest Quality Premium Luxury Home
Special Pricing } Highly Unique, Exceptional Quality, Luxury Estate
Some classifications have a corresponding"E" class. The "E" class has the same basic specifications. The
exceptions for"E" are additional refinements in material and workmanship. Ornamentation will be more
defined in some cases. Classes with the "E" are improved version of the class without the "E", but are not
worthy of being moved into a higher class.
Note: All Class Descriptions are adapted from the Marshal&Swift Residential Cost Handbook, 02009
Marshal&Swift;and Exceptional Homes,A Cost Guide for High-Value and Unique Residences, 02009
Marshal&Swift.
124
Class 6
Class 6 structures will be of low cost construction quality and materials. These structures will meet the
minimum standards for local building codes. All architecture will be designed for functionality, with little
or no attention given to appearance. The exterior finish will be plain, with little to no trim. Windows and
doors will be of low cost grade to meet minimum building standards.
The interior of Class 6 structures will meet the minimum requirements for local building codes.All fixtures
will be of low cost quality and minimal in quantity. Very little or no attention will be given to detail for
interior finish. Flooring will be low cost, and will meet the minimum building code requirements.
Class 7
Class 7 structures will be of inexpensive construction quality designed and built typically for mass
production. Class 7 structures are best described as a basic tract home. Most structures will be built from
a standardized set of plans with few options.Architecture will usually be standardized to allow for the use
of mass produced, inexpensive materials.Windows and doors will be inexpensive with little trim. Exterior
trim and ornamentation will be limited to the front of the structure. The overall quality of workmanship
is below average, but not below building code standards.
The interior of Class 7 structures will be finished with inexpensive grade materials. Fixtures will be
inexpensive and sufficient in quantity for the application. Flooring will be of inexpensive, mass produced
quality. Interior trim will be minimal.
Class 8
Class 8 structures will be of average quality construction and materials. Most structures will be built as
standardized plans with minimal options,but will have additional refinements to the interior and exterior.
Doors and windows will be of average quality, mostly stock & widely available materials. The overall
quality of construction will be average. Exterior trim will have sufficient ornamentation, average quality
masonry design, and average quality fenestration.
The interior of a class 8 will be of average quality, using standard grade materials and workmanship.
Flooring will be of average, stock quality. Fixtures will be of average quality and quantity. Some rooms of
the structure may receive slight levels of enhancement with trim for appearance.
Class 9
Class 9 structures will be of above average quality construction and materials. Most structures will be built
as standard plans, and may be built with mass production construction techniques and methods. Class 9
structures will have individual variances in the ornamentation and finish of the exterior. Roofing materials
will be of a moderately good quality weight and appearance. Structures will exceed building code
standards in nearly all categories. A class 9 structure is best described as a good quality tract home with
individually selected standardized variations.
The interior of a Class 9 structure will be of above average quality. Interiors are well finished with above
average level of attention is given to interior refinements and detail. Flooring will be of good quality
125
materials. Ample amounts of cabinetry in kitchen area of good quality. Some areas of the interior may
have vaulted,stepped, or cathedral ceilings.Overall interior finish and craftsmanship is of above average,
and good quality.
Class 10
Class 10 structures are of high quality construction and materials. These structures will frequently have
individual attention to detail. Some structures will be designed from tract type construction plans that
may have multiple options and variations. Roofing material will be of high quality materials, including but
not limited to metal. A class 10 structure is best described as a high quality tract home, or individually
designed structure with individual options and ornamentation. The exterior of Class 10 structures will
have considerable attention to detail, and will have considerable levels of ornamentation and
fenestration.
The interior of Class 10 structures will be high quality throughout. Flooring will be of high grade materials.
Interior ceiling height is likely to be greater than 8', with vaulted, stepped or cathedral ceilings in some
areas such as master bedrooms and main living areas. Hardware will be high quality. Corners and coves
will receive additional detail and trim.Crown molding or additional trim will likely be present in main living
areas, kitchens, and master bedroom areas. Fixtures will be abundant, well placed, and of high quality.
Kitchens will have high quality cabinets with high quality hardware. Kitchens may include items such as
island counters,wet bars, etc. Overall interior finish and craftsmanship is of high quality.
Class 10A
Class 10A structures are of excellent quality construction and materials.The term "excellent" is not to be
interpreted as "best" or "highest". These structures will be,for the most part, individually designed with
individual attention to detail.Some Class 10A structures will be built from a standardized builder plan, but
are likely to be modified to individual preferences. Class 10A structures are best described as a semi-
custom home with individually selected features that exhibit a level of uniqueness in their appearance.
The exterior of Class 10A structures will be of excellent quality, but not the highest or best quality. Roofing
materials will be of excellent quality, heavy-weight materials, and will occasionally include metal or
masonry-type material. High quality windows with high quality sash, and insulation features will be
standard. Non-masonry siding will be of high quality materials and installation.These structures will have
some custom ornamentation, excellent quality masonry work, and individually selected masonry styles.
The interior of Class 10A structures will be of excellent quality construction and materials. The term
"excellent" is not to be interpreted as "best" or"highest". Interior ceiling height for a Class 10A house is
likely to be 9 to 10 Feet. High quality interior doors and hardware will be standard. Vaulted, stepped or
cathedral ceilings in areas such as master bedrooms and main living areas will be common. Cabinetry will
be individually selected for the residence. Bedrooms will have spacious closets. Interior fixtures will be of
excellent quality, abundant, and well placed. Some fixtures may be unique in design. Kitchens will have
high quality cabinets with high quality hardware. Kitchen design may include items such as island
counters, wet bars, etc. Master Bath areas will be spacious, and may include separate tub and shower
areas. High grade plumbing fixtures will be standard.
126
Class 1013
Class 1013 structures are of excellent quality construction and materials, and are characterized by custom
quality workmanship and materials. These structures will be individually designed with significant
individual attention to detail. Class 10B structures will be built from a custom designed plan and will have
a high degree of customization to individual preferences. Class 10B structures are best described as a full
custom home that exhibits a high degree of uniqueness in appearance.The exterior of Class 10B structures
will be of excellent quality including high quality windows with high quality sash and high quality non-
masonry siding. These structures will have custom ornamentation including exposed wood, cast or cut
stone, high quality natural stone, etc. with excellent quality masonry work and individually selected
masonry styles. Some structures will utilize stucco or similar material. Roofing materials will be of
excellent quality, heavy-weight materials, and will occasionally include metal, clay tile, slate or other
masonry-type material. Roof design will typically have a moderately steep pitch with multiple ridges and
valleys.
The interior of a Class 1013 structure will be of custom, excellent quality materials and construction.
Typically interior ceiling height for a Class 1013 house is 9 to 10 Feet. Interiors may likely have solid core
doors with high quality custom grade hardware. Interior finish will include custom textures for walls, high
quality crown molding,trim,and additional accent features.Vaulted,stepped or cathedral ceilings in areas
such as master bedrooms and main living areas are typical. Cabinetry and built in shelving will be
individually selected for the residence,and will have high quality finish and hardware. Bedrooms will have
spacious closets. Interior fixtures will be of custom grade quality, abundant,and well placed. Kitchens will
have high quality custom cabinets with high quality materials, finish, and hardware. Kitchen design will
include items such as island counters, wet bars, etc. Master Bath areas will be spacious, and may include
separate tub and shower areas. High grade plumbing fixtures will be standard. High quality, custom grade
wood or tile flooring will be standard. Stairwells for 2-story homes will have custom detailed banisters.
Overall, the interior of Class 10B home is of excellent quality materials, custom design, and excellent
quality custom workmanship.
Class 10C
Class 10C structures are of the highest quality construction and materials,and are characterized by custom
quality workmanship throughout the entire structure.These structures will be individually designed with
a high level of attention to detail. Class 10C structures will be built from an individually custom designed
plan and will have a high degree of customization to individual preferences. Class 10C structures are best
described as a full custom home with luxury features that exhibit a very high degree of uniqueness in
appearance. The exterior of Class 10C structures will be of the highest quality including highest quality
windows and doors with highest quality sash and highest quality non-masonry siding. Entry doors will be
custom designed with substantial detail and workmanship.These structures will have significant levels of
custom ornamentation including exposed wood, cast or cut stone, high quality natural stone, etc. with
the highest quality masonry work and individually selected masonry styles. Stucco type materials will be
common at this level of quality. Roofing materials will be of the highest quality, heavy-weight materials,
and will include metal, clay tile, slate or other masonry-type material. Roof design will typically have a
steep pitch with multiple ridges and valleys. Highest quality gutters and downspouts will be standard.
127
The interior of a Class 10C structure will be of the highest quality custom, luxury materials and
construction techniques.Minimum interior ceiling height for a Class 10C house is 10 Feet. Many structures
will have ceiling height greater than 10 feet. Interiors will have solid core doors with the highest quality
custom grade hardware. Interior finish will include the highest quality custom textures for walls,
individually selected high quality crown molding, trim, and additional accent features. Vaulted, stepped
or cathedral ceilings in areas such as master bedrooms and main living areas are typical, ceilings will
typically have individually customized,and coffered/vaulted panel designs using the highest grade custom
materials. Cabinetry and built in shelving will be individually selected and of the highest grade materials
and include the highest quality custom hardware. Bedrooms will have spacious closets. Interior fixtures
will be of the highest quality and custom grade, abundant, and well placed. Kitchens will have the highest
quality custom cabinets with highest quality materials, finish, and hardware. Kitchen design will include
items such as island counters,wet bars,etc. Master Bath areas will be spacious, luxurious,and will include
separate tub and shower areas with the highest quality finish including custom designed vanities, lighting,
etc. Highest grade plumbing fixtures will be standard. Highest quality, custom grade wood or tile flooring
will be standard. Materials such as terrazzo, high grade marble, granite, or other luxury grade materials
are commonly used. Stairwells for 2-story homes will have custom designed and highest quality wood or
other materials used in banister construction. Overall, the interior of Class 10C home is of the highest
quality materials, custom, luxurious design, and the highest quality custom workmanship.
Class 10D
Class 10D structures are of the best quality construction and materials, and are characterized by the best
quality workmanship throughout the entire structure.These structures will be individually designed with
the best level of attention to detail. Class 10D structures are similar to Class 10C structures with additional
levels of luxury features. A Class 10 D structure is best described as a very high quality luxury home with
completely custom designed features. Exteriors will have the best quality windows and doors. Exterior
walls will be as thick as 8-12 inches. Clay, slate, or high grade metal roofing material will be standard.
Large roof overhangs of up to 3 feet are common.
The interior of a Class 10D is similar to a Class 10C, but with additional levels of luxury materials,fixtures,
and craftsmanship. Flooring will be of luxury grade, or exotic type hardwoods,tile, or other material that
is finished to a very high level, and are rated for high sustainability. Substantial levels of trim, moldings,
and textures applied to ceilings and walls. Some residences will have plaster walls and ceilings creating a
highly refined look. Stairwells for 2-story homes will be made from custom stone or hardwoods, and
include a high grade custom banister with substantial ornamentation. Kitchen areas will have elaborate
cooking and preparations areas with the highest grade appliances and ventilation systems, in addition to
luxury grade cabinetry and countertops. Sinks and basins will be of custom, high grade design and
materials. Master bathrooms will be finished elaborately with substantial detail. Tub and shower design
will be of a custom luxury level. Overall, the interior of a Class 10D home is of the best quality materials
with custom, luxurious design, and the best custom workmanship.
128
Class 11
Class 11 structures are of the finest quality construction and materials, and are characterized by the very
best quality workmanship throughout the entire structure. These structures will be individually designed
with the finest level of attention to detail. Class 11 structures are similar to Class 10D structures with
additional levels of finish and extensive attention to luxury features.A Class 11 structure is best described
as an extensively appointed, exceptionally high quality luxury home with completely custom designed
features. Class 11 structures will generally require extensive engineering costs due to the complexity of
the design and the environmental control systems required.The construction of many Class 11 structures
will require the use of steel reinforcement (1-beams, etc.) for large spans within the structure and for
additional support for the second floor.The exterior of Class 11 structures will have substantial levels of
detail and fenestration. Doors and windows will be custom designed and of the very best quality. Roof
design will have exceptional quality materials and will have substantial levels of detail and ornamentation.
The interior of a Class 11 is similar to a Class 10D, but with additional levels of luxury materials, fixtures,
and craftsmanship. Flooring will be of premium luxury grade, or exotic type hardwoods, tile, or other
material that is finished to a very high level, and are rated for high sustainability. Flooring will frequently
have custom inlaid materials, unique designs, patterns or artwork. Extensive levels of trim, moldings, and
textures applied to ceilings and walls.Residences will often have plaster walls and ceilings creating a highly
refined look.Trim/molding may include hand-fabricated custom materials, and may be finished with high
levels of detail.Ceilings may have plaster moldings or embossed metals for additional detail. Hand painted
murals on ceilings and walls are common at this level. Interior layouts will include elaborate special-
purpose rooms such as libraries,theaters, reception areas, hidden rooms, etc. Some residences may have
additional master suites or an elaborate guest suite. Master bedrooms will be extensively appointed with
the finest materials. Master closets will have peninsula or island type dresser cabinetry that is custom
designed with high grade materials and hardware within each of the his/her closets, and the closets will
be very spacious with luminous lighting. Some structures may have additional kitchens or kitchenette
areas for convenience. Minimum ceiling height for most class 11 structures will exceed 12 feet in height.
Overall, a Class 11 interior is of the very best quality luxury materials and workmanship with elaborate
levels of detail and refinement.
Class 11A
Class 11A structures will be of the finest quality of construction and workmanship. Class 11A structures
will be completely unique in design and workmanship. Structures of this quality will have extraordinarily
high levels of detail and luxury items. Class 11A structures are best described as individually designed,
unique,custom structures with extraordinary levels of detail, refinement,and luxury; and will incorporate
only the finest quality materials and workmanship. A partial steel frame for construction is common for
residences of this quality to accommodate large spans in open areas. The exterior of a Class 11A will be
of the finest quality materials, and workmanship. Nearly all windows and doors will be custom designed
for that residence, and will be of the finest quality available. Exterior trim will feature extraordinary levels
of detail to ornamentation and fenestration. Structures may have exposed wood beams, or other unique
ornamentation. Most exterior walls will be approximately 12" thick. Roof design will incorporate steep
slopes and will use the finest custom materials with extensive ornamentation. Some roof materials may
be imported from "one of a kind" sources. Some High quality flashing, such as copper or other high grade
metals will be used. Gutters will be of the finest quality and will be custom designed for the residence.
Front entries will have extraordinary levels of detail and incorporate the finest quality materials available.
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Interiors of Class 11A structures will be of the finest quality of construction, design, and craftsmanship.
Most structures will have the finest grade plaster walls with extraordinary levels of molding and trim.
Nearly all doors and windows will have molding and trim. Flooring will be of premium quality, custom,
luxury grade materials. Only the finest materials including imported tiles, terrazzo, high grade marble,
custom exotic parquet or plank hardwood flooring with custom, hand tailored finishes will be used.
Ceilings will contain extensive and elaborate designs including vaulted, coffered, ceilings with embossed
tin or plaster moldings. Some ceilings will have hand painted murals in addition to other custom artwork
throughout the structure. Nonstandard corners, angles, and radii will frequently be used for wall and
ceiling design. Electrical design will frequently incorporate extensive home automation systems to control
lighting, sound, climate, etc. Lighting fixtures will be extensive, well-placed, and of the finest quality.
Lighting may include several elaborately designed fixtures in prominent areas. Kitchens will spacious and
feature the finest quality materials and uniqueness in design. Some structures may feature separate
kitchen areas to be used by staff or for food preparation.The primary kitchen area will be used as a focal
point, or for entertaining. Master bathrooms will incorporate spacious areas with separate tub and
shower facilities. Plumbing fixtures are of the finest quality. Master bathrooms may have separate
his/hers toilets. Showers will be spacious and custom designed with elaborate materials and custom
fixture arrangement. Showers will likely have multiple spray heads, valves, and temperature controls.
Master Bedroom closet areas will be custom designed with elaborate cabinetry and storage design. Only
the finest quality materials and hardware will be used. Many structures will contain multiple rooms
designed for specific purposes, such as libraries, wine rooms, theaters, reception areas, gift wrapping
rooms, craft rooms, recording studios, etc. These rooms will be individually designed for the owner with
only the finest materials and craftsmanship. Minimum ceiling height for most class 11A structures will
exceed 12 feet in height.Overall,Class 11A interiors will be characterized by extraordinary levels of design,
detail, and luxury.
Class 11B
Class 11B structures exemplify the very finest quality of workmanship, with the very finest, superior
quality luxury materials and workmanship. At a minimum, Class 11B structures will incorporate the
features and qualitative aspects of an 11A structure with additional levels of refinement and luxury.
Although the Class 11B represents the use of the very finest luxury materials and workmanship for home
construction, it does not represent the highest cost for residential construction. Nearly every aspect of a
Class 11B structure will utilize superior grade luxury materials and craftsmanship. Rooflines of Class 11B
homes will typically be highly complex and steep in design with superior grade materials. Exterior design
will be highly unique with extensive and superior levels of fenestration detail.Turrets, bay windows, non-
standard angles, and complex architecture are very common.
The interior of Class 1113 will exemplify the very finest quality of workmanship, with the very finest,
superior quality luxury materials and workmanship. At a minimum, Class 11B structures will incorporate
the interior features and qualitative aspects of an 11A structure with additional levels of refinement and
luxury. Use of multiple textures on walls such as plaster, wood paneling, stone/tile walls,etc. is common.
Extensive levels of superior, luxury grade paneling, trim, and molding will be present in all main areas.
Ceilings will receive superior grade design with only the very finest of materials. Staircases may have
multiple curves, including "floating staircases" with superior grade hardware, handrails, and balusters.
Arched entries with extensive ceiling treatments into rooms and hallways are common. Use of one of a
kind and historically significant materials or fixtures is common.
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CLASS 11C
Class 11C structures do not appear frequently and has many variations in specifications and installation
of special features. In most cases the very best possible materials have been used with a tendency toward
the elaborate. This type of house has been especially designed by an architect to meet the owners'
requirements and will contain many special features.The house will have been built under architectural
supervision by a good contractor, using the best type of labor available. Use of class 11C should be limited
to residences that exceed the base cost of Class 11B by the addition of extensive amounts of fixtures and
accessories that are not covered in the basic cost calculations for that class.
Class Special Price (SP)
Use of Special Price Class should be limited to residences that exceed the base cost of Class 11B by the
addition of extensive amounts of fixtures and accessories that are not covered in the basic cost
calculations for that class.
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AREAS CODES FOR PRICING SEGMENTS
Living Area's Code % Of Base Price
First Floor MA 100
Attached Addition MAAA 100
Attached Addition MAA50 50
Attached Addition MAA66 66
Attached Addition MAA75 75
Game Room MAGM 100
Bonus Room MABR 100
Basement MABA 100
MA2 94% ALL 10'S,3,3E,4,4E,ALL 5'S
MA2 90% 7,7E,8,8E,9,9E
MA2 100% 1,1E,2,2E,6,6E,11,1 IA,11B
MA3 94% ALL 10'S,ALL 5'S
MA3 90% 7,7E,8,8E,9,9E
MA3 100% 1,1E,2,2E,3,3E,4,4E,6,6E,11,1 IA,IIB
MA4 90% 10D,10DE,11,11A,118
Barn BRN 100
Stables STB 100
Pool PL 100
Arena ARN 100
Outdoor Kitchen ODKIT FLAT PRICE
Storage STG 100
LIVING AREA'S A T A PERCENT OF BASE PRICE
Living Area's New Code % Of Base Price
Game Room GM75 75
Game Room GM66 66
Game Room GM50 50
Basement BA75 75
Basement BA50 50
DETACHED LIVING AREA'S
Living Area's New Code % Of Base Price
Detached Living Quarters DL66 66
Detached Living Quarters DL50 50
Living Quarters LQ66 66
Living Quarters LQ50 50
Bath House BH50 50
Bath House BH33 33
PORCHES, CARPORTS, DECKS
New Code % Of Base Price
Balcony, Open Porch BL,OP 15
Balcony, Open Porch BL25,OP25 25
Balcony, Open Porch BL10,OP10 10
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Carports, Decks CP,DK 15
Carports, Decks CP25,DK25 25
Carports, Decks CP10,DK10 10
Gazebo GZ 15
Gazebo GZ25 25
Gazebo GZ10 10
Glass Porch, Porch Area GP,PA 33
Glass Porch, Porch Area GP66,PA66 66
Glass Porch, Porch Area GP50,PA50 50
Glass Porch, Porch Area GP251PA25 25
GARAGE & STORAGE
New Code % Of Base Price
Attached Garage AG 33
Attached Garage AG25 25
Storage SA 33
Storage SA50 50
Storage SA25 25
Enclosed Garage EG 40
Enclosed Garage EG75 75
Enclosed Garage EG33 33
Detached Garage DE33 33
Detached Garage DE25 25
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EXAMPLE OF VALUE CALCULATION:
This is an example of a class 8 house, total living area of 3,200. The house has 2
stories, an attached 2 car garage, and covered porches.
MA 2,400 (1st floor)
MA2 800 (2nd floor)
AG 528 (attached garage)
OP 160 (covered porch)
Codes Area Unit Price Dep. NBHD
MA 2,400 x $ 50.25 x 98% x 105% — $ 124,097
MA2 800 x $ 45.23 x 98% x 105% = $ 37,233
AG 528 x $ 16.58 x 98% x 105% = $ 9,008
OP 160 x $ 7.54 x 98% x 105% = $ 1,241
Value of Improvement $ 171,580
Land Value 32,000
Total Indicated Value of Property $ 203,580
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CLASS 1740
RESIDENTIAL TENNIS COURTS
Class 1740RN No Contributory Value
1740RB Basic(court only)
1740RA Average (court&fence)
1740RG Good(court, fence,lighting)
1740RE Excellent(court, fence,lighting)
Note: Tennis Courts classes 1740, 1740A, and 1740B will be used for commercial only.
CLASS 1750
RESIDENTIAL SWIMMING POOL
Class 1750B (Basic)
1750A(Average)
1750G(Good)
1750E(Excellent)
1750S (Superior)
Minus(-) can be applied to any class for pools in poor condition.
Add for therapeutic pool
Part E. Appraisal of Manufactured Homes (Mobile Homes)
As defined by International Association of Assessing Officers(IAAO) "Standard on Automated
Valuation Models (AVMs) a manufactured home is a residential structure built in a factory. Construction
standards for manufactured housing are controlled and monitored by the Department of Housing and
Urban Development(HUD).
The Residential Department values all mobile homes occupied as residences. This includes mobile
homes located in mobile home parks, subdivision lots or abstract tracts.Mobile homes used for
commercial purposes or mobile homes held as inventory for sale would not be valued by the Residential
Department. Locating mobile homes are done through inventories,park rosters, installation permits,the
Texas Department of Housing and Community Affairs(TDHCA),homestead applications, and
Department of Transportation report on movement of mobile homes in and out of Denton County.
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2.41 MH Park Inventories
Numerous areas across the county have been identified as subdivision developments. Most of these are
platted,but some remain as un-platted abstract tracts. Appraisal cards are printed on every account in the
subdivision or abstract. Each account is checked to see if a mobile home has been removed or moved in.
Label and serial numbers are checked and recorded. Any changes are so noted on the appraisal card and
the changes are processed.
2.42 Park Rosters
At the end of each year DCAD mails to each park manager and park owner a list(park roster)of DCAD's
current ownership and location of mobile homes in the park. A letter is sent with each park roster
requesting an update on ownerships. The park managers/owners are asked to supply any changes that had
occurred during the year in the ownership of the mobile home,new ones moved in or out.
After the first of January and throughout the spring months,an appraiser will field check each park. The
manager's information is used to verify mobile home removals and new mobile homes moved into the
park. When a roster is not returned to DCAD with the requested information an appraiser will first notify
the park manager then do a complete inventory of that park.
2.43 Installation Permits, TXDOT movement reports
County and city permits, Texas Department of Housing and Community Affairs and Texas Department of
Transportation are used to discover mobile homes in areas inside and outside mobile home parks.
City and county permits are obtained through copies of the permit by either electric means or visiting that
entity. Information on the permits such as situs and/or legal descriptions are used to locate the correct
accounts. The permit is then forwarded to the appraiser who then field checks the account. Texas
Department of Housing and Community Affairs(TDHCA)website;
http://mhweb.tdhca.state.tx.us/mhweb/title_view.jsp and Texas Department of Transportation website;
http://txpros.txdot.gov/mhreports.aspx are used to update the districts' records of ownership and
movement of mobile homes.
2.44 Taxpayer
Property owners are also a source of ownership or movement of the mobile home. If the mobile home is
sold the new owner and address are required to make the change of ownership. Homestead applications
are a very good source of information on ownership and movement. The landowner may request to render
the mobile home as an Improvement Only account to be set up in the mobile home owner's name rather
than placed on his land account.
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2.45 Field Inspection
Data is collected and recorded on the size of the mobile home, actual age, effective age, and the label
number of the mobile home. Mobile homes manufactured after 1979 are required to have the label
number on the exterior of the mobile homes. The label number is also used to identify ownership using
TDHCA website. Label and serial numbers are added to the account if either is located. It is also helpful
to note any distinguishing features about the home, such as color.
2.46 Classification of Mobile Home
Classifications for mobile homes are developed using Marshall and Swift's basic descriptions.
Classifications begin with the lowest quality construction to the highest quality construction for both
single and double wide mobile homes. Mobile home classes for DCAD range from MS1 to MS4 for
single wide and MD1 to MD4 for double wide. Using the DCAD appraisal manual mobile homes are
assigned a class based on the quality of construction as defined in each class. Variations may occur using
plus and minus techniques to each class.
Any other structures present would be measured,classed and added to the mobile home account. These
could include porches, carports, decks, detached garages, and outbuildings. Anything attached to the
main structure will be values using segment codes that are set to value based on a percentage of the main
area class. If the appraiser cannot get to the mobile home due to dogs, locked gates, inaccessible roads, or
for other reasons, all information must be estimated.
While in the field,the appraiser needs to determine or verify our mobile home ownership/address and all
data. This could be done through conversations with owners,renters, or neighbors. Mailboxes can also
be used for a name.
2.47 Creation of Improvement Only
When the mobile homeowner does not own the land on which the mobile home is situated and is carried
as personal property with TDHCA the mobile home is created as an"Improvement Only"account with no
land segment included. This applies to all units in a mobile home park since they are located on leased
spaces and for mobile homes located on leased land. This would also include accounts where the owner
has a contract for deed. In this situation the land account is carried in the land owner's land until such
time as a warranty deed is issued.
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A. Legal Description
Each park, subdivision, or abstract have an assigned subdivision code number or abstract number. The
new account is coded with the number in which the improvement is located. The legal description must
match the land account's legal description exactly except in the case of mobile home parks. The park
accounts will have the park name and space number as the legal description. Along with the legal
description the term"Imp Only" is added. The serial number(if located)and HUD number is entered into
the account for all mobile homes whether listed as personal property or as real property.
B. Owner and Entity Information
The owner name and a complete address must be complete on the appraisal card. Also, entity codes must
be assigned for each account. To determine which entity codes are needed for the county, school, city, or
special districts,the appraiser must refer to and match the codes on the land account.
C.Avoiding Duplication of Accounts
When creating new mobile home accounts the appraiser must make sure he/she is not duplicating the
mobile home. The mobile homes could have been located in a different jurisdiction and then moved to a
new location. To avoid duplication queries can be run using the label and/or serial number to locate
duplication in the data.
2.48 Maintenance Improvement Only Accounts
All Mobile Home accounts are to be set up as they exist on January 1 st in the title owner's name and at
their location on that date. The Texas Department of Transportation(TxDot),per House Bill 785,
provides each appraisal district with a list of mobile home movements that have occurred within that
county. Access to this information is through TxDot's website; http://txpros.txdot.gov/mhreports.aspx.
Mobile homes are not sold in the same manner as real estate.No deeds are filed when a transfer occurs.
Mobile homes are moved in and of the area throughout the year. Often information on ownership and
location is submitted after the rolls are certified. hi these cases ownership changes and movement of
mobile homes are updated by supplemental changes after roll certification.
If the owner defaults on their mobile home loan and is repossessed by the lienholder the account is
transferred into the lienholders' name.
If the mobile home was removed before January 1 st,the account is deleted. If the mobile home owner
before January 1 st, gets deeded title to his land after a contract is paid off,the Improvement Only account
needs to be deleted. The mobile home would be placed on the land account.
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2.49 Mobile Home on Land Accounts
If the mobile home owner has the warranty deed on his land account,the mobile home is combined on
this land account.
Mobile homes provide a unique situation. The lien for the land can be different from that of the mobile
home. If the whole or parts of the property are foreclosed upon at the request of the new owner the mobile
home will be split from the land account. The account will be split for as many years allowable by the
Texas Property Tax Code. The land account will be supplemented and a corrected notice of appraised
value will be mailed for the mobile home for the years involved. This procedure will only occur when the
liens are separate.
2.50 Mobile Home Valuation
In mass appraisal,the classification system is utilized to value properties. The eight classes of mobile
homes(see Appraisal Manual)each generates a per square foot unit price. The class is determined by
quality. Each mobile home is depreciated based on its effective age and condition. A mobile home
depreciation schedule is used in the valuation(see Appraisal Manual).
A. Cost
The cost schedule,based on construction of similar improvements, is developed from information
gathered from reliable sources such as Marshall& Swift, a national publication of building cost, and
using the current N.A.D.A.Mobile/Manufactured Housing Appraisal Guide. The cost approach consists
of calculating the replacement cost new for each improvement and then deducting for normal
depreciation.
The causes of accrued depreciation fall into three general categories: physical deterioration,functional
obsolescence,and external(economic obsolescence). Physical deterioration and functional obsolescence
are inherent in the property itself,whereas external(economic) obsolescence is the result of outside
forces.
Physical deterioration is the loss in value due to the wear and tear of the property. There are curable and
incurable forms of physical depreciation. It depends on whether the value added by curing them exceeds
the cost to cure (it is not economically prudent to cure the condition). Effective age is the number of
years of age of the improvement as indicated by its condition. If the improvement has been well
maintained, its effective age may be less than the actual age; if there has been poor maintenance, it may
be greater. The appraiser based on inspections determines this.
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Functional Obsolescence is the overall usefulness and desirability of a property. Functional obsolescence
is the loss of value in a property improvement due to changes in style,taste,technology,needs, and
demands. It exists where property suffers from poor or inappropriate architecture,poor floor plans,room
sizes, etc.
External Obsolescence is the loss in value caused by outside forces such as in the highest and best use of a
property due to market shifts or governmental actions,restrictions on income,zoning,neighborhood
decline, etc. This can influence both land and improvement.
Once the estimated depreciated improvement value is determined it is then added to the land value giving
an estimated total property value. The cost approach is used as a comparison to the market schedules.
V=LV+((CN—D)
(Value=Land Value+(Cost New—Depreciation)
65,000= $15,000+($62,500—20%)
B. Market
DCAD mobile home schedules are cost driven. Sales analysis is used in areas where mobile home and
land are sold together as one unit.
C. Sales Information
All sales information collected is the responsibility of the Land and Sales Department. Residential
improved sales are collected from a variety of sources including,but not limited to,district questionnaires
sent to buyer and seller, field discovery,protest hearings,various sales vendors,builders,and local real
estate professionals. A system of type, source, and validity codes was established to define salient facts
related to a property's purchase or transfer. ISD,neighborhood, and subdivision sales reports are
generated as an analysis tool for the analyst in the development of value estimates. Sales information is
stored in the mainframe database.
D. Depreciation
A depreciation schedule has been built and entered in the computer. The actual age, if known,is listed on
the account and the field appraiser estimates the effective age. Based on the field appraisers' estimates the
percent good is pulled from the table based upon the effective age. DCAD residential depreciation tables
are built using Marshall&Swift depreciation tables.
E. Calculation
The square footage determined from the field inspection is then multiplied by a per square foot unit price
to indicate the RCN(Replacement Cost New) for the mobile home. The RCN is then multiplied by a
physical percent to give a depreciated value.
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CLASS MS1 MOBILE HOME
CONSTRUCTION STANDARDS: Meets minimum requirements: Older Homes
(constructed prior to 1976)may be below minimum
requirements.
QUALITY/DESIGN: Basic, inexpensive quality. No special features.
No attention to details.
EXTERIOR COVERING: Prefinished aluminum panels, exposed screw fasteners.
Some with vinyl covering. No trim.
ROOF: Flat pitch. Light gauge galvanized steel, loose fitting.
TOW BAR: Non-detachable - attached to frame.
WINDOWS: Crank louvered or awning type. Non-removable
screens. Minimum fenestration. No window trim.
DOORS: Entrance - Sliding glass or hollow metal.
Back-hollow metal, swing out, no windows.
WIDTH: Single wide - Typically 10' or 12'.
141
CLASS MS2 MOBILE HOME
CONSTRUCTION STANDARDS: Meets or exceeds minimum requirements.
QUALITY/DESIGN: Average quality. Few, if any, special features.
EXTERIOR COVERING: Often prefinished aluminum with concealed
fasteners. Some with masonite paneled
siding. Some trim on front side.
ROOF: Medium pitch. Medium gauge galvanized
steel, snug fitting.
TOW BAR: Attached to frame - some can be unassembled.
WINDOWS: Crank awning or horizontal sliding, few
double hung. Removable screens. Minimum to
adequate fenestration. Color coordinated
panels for trim.
DOORS: Entrance - sliding glass and metal or wood,
with window. Back-metal or wood, swing in
or out, with window.
WIDTH: Single wide - Typically 12' or 14'.
142
CLASS MS3 MOBILE HOME
CONSTRUCTION STANDARDS: Exceeds all minimum requirements.
QUALITY/DESIGN: Above average quality. Some special features
(custom), attractive architectural design.
EXTERIOR COVERING: Usually wood siding, as with flush-type
masonite paneled siding. Some trim on all
sides.
ROOF: Gable pitch. Usually average to good asphalt
shingles. Some with heavy gauge galvanized
steel, tightly fitting. Some slit-roof.
TOW BAR: Detachable.
WINDOWS: Double hung windows (some with bay across
front). Removable screens. Adequate
fenestration. Two-tone, contrasting material
for trim.
DOORS: Entrance -recessed, wood(house-type).
Back-wood with window, swing-in.
WIDTH: Single wide - Typically 14'.
143
CLASS MS4 MOBILE HOME
CONSTRUCTION STANDARDS: Exceeds all minimum requirements.
QUALITY/DESIGN: Excellent quality. Many special features.
Best in design, workmanship and materials.
EXTERIOR COVERING: Like conventional, house-type coverings, as
shiplap, clapboard, stucco, brick, board
and batten. Usually wood siding. Trim/decor
on all sides.
ROOF: Usually gable pitch: or, other conventional
house type. Usually best asphalt shingles.
TOW BAR: Detachable.
WINDOWS: Double hung, often dual pane. Removable
screens. Ample fenestration. Decorative,
special trim(as, for example, shutters) on
all windows.
DOORS: Recessed, wooden solid core. Some with
double entry.
WIDTH: Single wide - Typically 14' or 16'
144
EXAMPLE OF VALUE CACULATION:
This is an example of a class MS2 mobile home(14' x 70'),total living area of 980 sgft. The mobile
home does not have a porch or garage. The mobile home is estimated to be 74%good.
MA 980 x $31.45 x 74% = $22,807
Land Value + $15,000
Total Indicated Value of Property = $37,807
CLASS MD1 MOBILE HOME
CONSTRUCTION STANDARDS: Meets minimum requirements: Older
homes (constructed prior to 1976)may
be below minimum requirements.
QUALITY/DESIGN: Basic inexpensive quality. No
special features, no attention to details.
EXTERIOR COVERING: Prefinished aluminum panels, exposed
screw fasteners. Some with vinyl
covering. No trim.
ROOF: Gable pitch. Light gauge galvanized
steel or low-cost asphalt shingles.
No overhead.
WINDOWS: Crank louvered or awning type.
Non-removable screens. Minimum
fenestration. No window trim.
DOORS: Entrance - sliding glass or metal,
Back- metal, swing out, no windows.
WIDTH: Double-wide.
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CLASS MD2 MOBILE HOME
CONSTRUCTION STANDARDS: Meets or exceeds minimum requirements.
QUALITY/DESIGN: Average quality. Few, if any, special features.
EXTERIOR COVERING: Prefinished aluminum with concealed
fasteners or masonite paneled siding.
Some trim on front side.
ROOF: Gable pitch. Low-cost to average
asphalt shingles. Small overhang.
WINDOWS: Often double hung, some crank awning
or horizontal sliding. Removable screens.
Minimum to adequate fenestration. Color
coordinated panels for trim.
DOORS: Entrance - Sliding glass and metal or
wood, with window. Back- Metal or
wood, swing in or out, with window.
WIDTH: Double-wide.
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CLASS MD3 MOBILE HOME
CONSTRUCTION STANDARDS: Exceeds all minimum requirements.
QUALITY/DESIGN: Above average quality. Some special
features (custom), attractive
architectural design.
EXTERIOR COVERING: Usually wood siding, as with
flush-type masonite paneled siding.
Some trim on all sides.
ROOF: Gable pitch. Good asphalt shingles.
Good overhang.
WINDOWS: Double hung windows (some with bay).
Removable screens. Adequate
fenestration. Two-tone, contrasting
material for trim.
DOORS: Entrance -Recessed, wood(house-type).
Back-Wood with window, swing in.
WIDTH: Double-wide.
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CLASS MD4 MOBILE HOME
CONSTRUCTION STANDARDS: Exceeds all minimum requirements.
QUALITY/DESIGN: Excellent quality. Many special
features. Best in design,
workmanship and materials.
INTERIOR COVERING: Like conventional house-type
coverings, as shiplap, clapboard,
stucco, brick, board and batten.
Usually wood siding. Trim/decor on all sides.
ROOF: Usually gable pitch, or other
conventional house-type. Usually
best asphalt shingles. Some slate,
shake or tile.
WINDOWS: Double hung,usually dual pane.
Removable screens. Ample
fenestration. Decorative, special
trim (as, for example, shutters) on
all windows.
DOORS: Recessed, wooden solid core. Some
with double entry.
WIDTH: Double-wide.
148
EXAMPLE OF VALUE CALCULATION:
This is an example of a class MD3 mobile home, total living area of 1,440. The mobile home
has a detached garage and covered porches.
MA 1,440
AG 528 (attached garage)
OP 160 (covered porch)
Codes Area Unit Price Dep. NBHD
MA 1,440 x $ 34.31 x 98% x 105% = $ 50,839
DE25 528 x $ 8.58 x 98% x 105% = $ 4,661
OP 160 x $ 5.15 x 98% x 105% = $ 847
Value of Improvement $ 56,347
Land Value 18,000
Total Indicated Value of Property $ 74,347
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MH AREA'S TO ESTABLISH PRICE PER SQ.FT.
% Of Base
Living Area's New Code Price
Main Area MA 100
Attached Addition MAAA 100
LIVING AREA'S AT A PERCENT OF BASE PRICE
% Of Base
Living Area's New Code Price
Attached addition MAA50 50
Attached addition MAA66 66
Attached addition MAA75 75
PORCHES, CARPORTS, DECKS
% Of Base
New Code Price
Open Porch OP 15
Open Porch OP25 25
Open Porch OP10 10
Carports, Decks CP,DK 15
Carports, Decks CP25,DK25 25
Carports, Decks CP10,DK10 10
Glass Porch, Porch Area GP,PA 33
Glass Porch, Porch Area GP66,PA66 66
Glass Porch, Porch Area GP50,PA50 50
Glass Porch, Porch Area GP25,PA25 25
150
GARAGE & STORAGE
% Of Base
New Code Price
Attached Garage AG 33
Attached Garage AG25 25
Storage SA 33
Storage SA50 50
Storage SA25 25
Enclosed Garage EG 40
Enclosed Garage EG75 75
Enclosed Garage EG33 33
Detached Garage DE75 75
Detached Garage DE33 33
151
EXAMPLE OF VALUE CALCULATION:
This is an example of a class MD3 mobile home, total living area of 1,440. The mobile home
has a detached garage and covered porches.
MA 1,440
AG 528 (attached garage)
OP 160 (covered porch)
Codes Area Unit Price Dep. NBHD
MA 1,440 x $ 34.31 x 98% x 105% = $ 50,839
DE25 528 x $ 8.58 x 98% x 105% = $ 4,661
OP 160 x $ 5.15 x 98% x 105% = $ 847
Value of Improvement $ 56,347
Land Value 18,000
Total Indicated Value of Property $ 74,347
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Part F. Sales and Research
2.51 Sales and Research Department
The Sales and Research Department is responsible for several functions of the Denton Central Appraisal
District(DCAD). One of the main responsibilities is the collection and processing of real estate sales
information. The quality of the process and execution of this responsibility is vital to the integrity of
establishing the appraisal roll. Gathered sales information is used to establish class schedules and verify
that values placed on Denton Central Appraisal District appraisal rolls are as accurate as possible.
Another important function of the Sales and Research Department is responding to public request,
comments and complaints. This includes open records requests and dealing with comments and/or
complaints from the public in regard to appraisal district operations. The Supervisor in the Sales and
Research Department is typically responsible for overseeing and coordinating appropriate responses to
open records requests and a taxpayer liaison officer(TLO)is generally responsible for responding to
comments and/or complaints.
Overviews, guidelines,and procedures demonstrated in this section are followed by the Sales and
Research Department of the Denton Central Appraisal District.
2.52 Education and Training
All employees shall have the knowledge and expertise to do their job. Each employee will have a
minimum educational standard required for their position. In addition,DCAD will supply the following:
A. On the job training—each employee will receive training on procedures,policy,and
equipment by their supervisor and other employees in similar positions.
B. State required education and registration—all employees so required will achieve and maintain
their own educational and registration requirements.
C.Additional training and education—from time to time, additional training and education will
be required to enhance job performance,knowledge and expertise.
Employees will be expected to perform to a minimum standard.
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2.61 Introduction
An appraisal management policy should reflect regulatory obligations,mandate due diligence, ensure
conformance to professional standards,generate current and meaningful valuations, and establish criteria
for a thorough review process. DCAD subscribes to the standards of the International Association of
Assessing Officers (IAAO)regarding its appraisal practices and procedures. DCAD also subscribes to
the standards promulgated by the Appraisal Foundation known as the Uniform Standards of Professional
Appraisal Practice(USPAP). A current copy of the USPAP manual is on file at DCAD. The department
is responsible for completing mass appraisal assignments in a timely manner.
A. Definition of Appraisal Responsibility
The Sales and Research Department of the Denton Central Appraisal District is responsible for
ascertaining and processing sales information to assist appraisers in developing fair and uniform market
values for all real accounts in DCAD.
B. Legal and Statutory Requirements
The provisions of the Texas Property Tax Code (TPTC)and relevant legislative measures involving
appraisal administration and procedures control the work of the appraisal district. The district is
responsible for appraising property on the basis of its market value as of January 1 for ad valorem tax
purposes for each taxing unit that imposes ad valorem taxes on property in the district. DCAD typically
reappraises property on an annual basis but is required to do so every three years per the Texas Property
Tax Code.
C. Administrative Requirements
An appraisal management policy should reflect regulatory obligations,mandate due diligence, ensure
conformance to professional standards,generate current and meaningful valuations, and establish criteria
for a thorough review process. DCAD subscribes to the standards of the International Association of
Assessing Officers (IAAO)regarding its appraisal practices and procedures. DCAD also subscribes to
the standards promulgated by the Appraisal Foundation known as the Uniform Standards of Professional
Appraisal Practice(USPAP). A current copy of the USPAP manual is on file at DCAD.
D. Appraisal Resources
Personnel—The Sales and Research Department staff consists of a manager, supervisor,research
specialist, coordinator specialist/liaison officer and support position. In addition,there are several part-
time support positions that are utilized throughout the year.
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Information Systems—The mainframe systems are augmented by the databases that reside as various
applications on the DCAD Local Area Network(LAN). DCAD offers a variety of systems for providing
property owners and public entities with information services. Appraisal Support fields many of the
public's questions or redirects them to the proper department. Computer terminal stations are located in
the customer service area for the public's use.
Access to appraisal data is also available through various sources such as the district's website
2.62 Sales and Statistical Analysis
B. Sales Information
The Sales and Research Department is responsible for the collection and processing of all sales
information. Collection is done by a variety of sources including,but not limited to,district
questionnaires/surveys sent to buyers and sellers,real estate brokers and appraisers,builders,developers,
field discovery,protest hearings, informal settlement conferences, adjoining appraisal districts,the State
of Texas Comptroller's Office,and private sale service providers/vendors, such as local Association of
Realtor's MLS,LoopNet, and CoStar. As much pertinent information as possible is gathered about the
sale to help determine the quality and conditions of the sale; for example, does the sale appear to be an
arm's length transaction or not. A system of type, source and validity codes has been established to help
define these salient facts related to a property's purchase or transfer. Entity,neighborhood and
subdivision sales reports are generated as an analysis tool for the appraisal analyst in the development of
value estimates. Sales information is stored in the mainframe database. Refer to the software user's
manual for software implementation.
C. Statistical Analysis
Appraisers in the appraisal departments perform statistical analysis annually to evaluate whether values
are equitable and consistent with the market. Ratio studies are conducted on each property category,
neighborhood and ISD to judge the two primary aspects of mass appraisal accuracy—level and uniformity
of value. Appraisal statistics of central tendency and dispersion generated from sales ratios are available
for each property category and/or neighborhood within an ISD and summarized. These summary
statistics including,but not limited to,the median,the mean,the weighted mean, standard deviation,
coefficient of dispersion(COD), and coefficient of variation(COV),provide the analysts an analytical
tool by which to determine both the level and uniformity of appraised value of a property category and/or
neighborhood basis. Review of the standard deviation, coefficient of dispersion and the coefficient of
variation can discern appraisal uniformity within and between categories and ISD's.
Subdivisions and/or neighborhoods are reviewed annually by the appraiser through the sales ratio analysis
process. The first phase involves subdivision/neighborhood ratio studies which compare the recent sales
prices with the appraised values of those properties which have recently sold. This set of ratio studies
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affords the appraiser an excellent means of judging the present level of appraised value and uniformity of
the sales. All valid sales that we are aware of are used unless the result is misrepresentative.
D. Market Adjustment or Trending Factors
Market adjustment factors are developed from appraisal statistics provided from ratio studies and are used
to ensure that estimated values are consistent with the market.
If the subdivision/neighborhood is to be updated,the appraiser uses a ratio study that compares recent
sales prices of properties within a delineated subdivision/neighborhood with the properties' appraised
value. The calculated ratio derived from the sum of the sold properties' appraised value divided by the
sum of the sales prices indicates the subdivision/neighborhood level of value based on the unadjusted
value for the sold properties. This comparison of appraised value-to-sale ratio determines the market
adjustment factor for each subdivision/neighborhood. This market adjustment factor is needed to trend
the values closer to the actual market evidenced by recent sales prices within a given
subdivision/neighborhood. The market adjustment factor calculated for each updated
subdivision/neighborhood is applied uniformly to all properties within a neighborhood and as needed in
the subdivision. Once the market-trend factors are applied, a second set of ratio studies is generated that
compares recent sale prices with the proposed appraised values for these sold properties. From this set of
ratio studies,the appraiser judges the appraisal level and uniformity in both updated and non-updated
subdivision/neighborhoods,and finally, for the school district as a whole.
2.63 Performance Tests
B. Sales Ratio Studies
The primary analytical tool used by the appraiser to measure and improve performance is the ratio study.
This helps to insure that the appraised value that it produces meets the standards of accuracy in several
ways. Overall sales ratios are generated for each ISD to allow the appraiser to review general market
trends and provide an indication of market appreciation or depreciation over a specified period of time.
Sales ratio reports are run several times prior to the setting of preliminary values as well as after
finalization of appraisal values in order to catch any inaccuracies,value anomalies, or outliers.
An independent test of the appraisal performance of the district is conducted by the State of Texas
Comptroller's Office through the property value study. The study determines the degree of uniformity
and the median level of appraisals by the appraisal district within each major category of property. The
comptroller publishes a report of the study,which includes in the report the median levels of appraisal for
each major category of property,the coefficient of dispersion around the median level of appraisal for
each category of property, and any other standard statistical measures that the comptroller considers
appropriate.
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2.64 Data Collection Procedures
Overview
One of the main responsibilities of the Denton Appraisal District is to estimate the market value of each
property within the jurisdiction. The integrity of the property tax is dependent on the accuracy of these
estimates of market value. This is accomplished by analyzing market data to determine the price that the
property being appraised would probably bring in the marketplace on the date of appraisal. Accuracy is
dependent upon proper data collection,verification, adjustments of sales data and entering into computer
system. Sales data should be collected,verified, and adjusted as necessary for model calibration and
ratio study purposes.Verified sales are always more reliable than unverified sales. Sales information is
collected and processed on a regular basis throughout the year to help appraisers in their analyses.
Data Collection
Sales information is collected by various methods and sources, including: questionnaires to buyers and
sellers,renditions,protest hearings,realtors,fee appraisers,brokers,Title companies,builders,property
managers,newspaper, attorneys, State Office, developers, adjoining appraisal districts and third-party
sources such as MLS,LoopNet, and CoStar. When necessary, staff may try to contact parties involved in
a sale to try to confirm the sales price and/or get additional information of details of the sale transaction.
This may be done by phone calls,personal interviews,emails, or regular mail. Data collection is
overseen by the Sales &Research Department supervisor. This person will coordinate with the
appropriate vendors for mail out of internal sale survey letters that are sent to the buyer and seller,with
third-party sources(make sure the District is current with paid subscriptions, etc.), and the gathering of
sales data during the appeal process. The supervisor will work closely with the appraisal support
specialist to monitor their coordination with other District departments and make sure the process is
organized,has a timely flow of gathering the sales data to the entering of the data in the mainframe
database. Data is gathered on a regular basis throughout the year. Sale survey letters are computer
generated based on deed transfers and are typically mailed on a monthly basis. A postage paid/pre-
addressed business reply envelope will accompany each letter. The data obtained from third-party
sources is typically gathered on a weekly basis. Settlement Statements are often obtained during the
appeal process and are considered the most reliable sales verification. Data from other sources will be
gathered whenever possible throughout the tax year. A quality control process exists through supervisory
review of the work and procedures.
The supervisor is charged with the responsibility of ensuring that appraisers and support specialist are
following proper procedures, identify and address training issues and provide uniform training throughout
the department. Once data is gathered,the next phases begin with the verification/analysis and entering
of data. It is vital that the gathering, analyzing and entering of sales data is performed at a high quality
level so that the appraisers have the best data available to help them during the appraisal and appeal
processes.
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Data Verification
Verification of sales data is an important aspect in the data collection process. It is important to remember
all sales should be considered valid unless there is sufficient documentation to prove differently. While it
is imperative that sales be verified uniformly and accurately,it is also important to process and verify
sales in a timely manner so they are available for analysis. Sales should be trimmed for outliers during
the statistical phase,not during the verification phase of mass appraisal. Useful sales information
gathered should include the following when possible:
• Full consideration(actual sales price)
• Names of buyer and seller
• Addresses,phone numbers, and other contact information of buyer and seller or their legal
designee
• Relationship of buyer and seller(if any)
• Legal description,address, and parcel identifier
• Type of transfer
• Method of marketing(ex. Owner or Broker)
• Time on the market
• Type and terms of financing
• Personal property(if any, and if so,how much)
• Business value attributed(if any)
• Date of Sale
• Deed Instrument number
• Closing costs involved(who paid,etc.)
• Other—any information the buyer, seller or contact believes is important
Sales should be verified to determine whether they reflect the market value of the real property
transferred. Specific objectives for sales verification include but are not limited to the following:
• Sale prices reflect only the market value of the real property transferred and not the value of
personal property, financing,or leases.
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• Sales occurred during the time frame being tested or modeled.
• Sales are excluded only when they fail to meet the requirements of an open-market, arm's length
transaction.
All sales meeting the definition of market value should be entered as valid transactions unless one of the
following two conditions exists:
• Data for the sale are incomplete,unverifiable, or suspect.
• The sale fails to pass one or more specific tests of acceptability.
All sales should be considered as valid sales unless sufficient information can be documented to show
otherwise. Reason codes or comments may be established for valid and invalid sales for both ratio studies
and model calibration. Staff should use their judgment in determining if sales are valid or invalid,but
they should not be arbitrary.
Importance of Sales Verification
Sales data are needed for the valuation process and for sales ratio studies. The reliability of any valuation
model or sales ratio study depends on the quality and quantity of its data. Sales data should be collected,
edited, and adjusted(if necessary)to obtain valid indicators of market value. If there is a question or
concern about a sale, staff should try to contact a party to the sale to verify or clarify the question or
concern. Staff should be familiar with sales involving:
• Adjoining property owner
• Auctions
• Internet marketing
• Sale leasebacks
• Personal property
• Property characteristic changes
• Related parties
• Sealed bids
• Uninformed buyers and sellers
• IRS 1031 exchanges
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• REITs
• Trades
• Financial institutions
• Short sales
In regard to validity, sales that may be considered invalid are:
• Sales involving government agencies
• Sales involving charitable,religious,or educational institutions
• Sales involving financial institutions as buyer or seller
• Sales between relatives or between corporate affiliates
• Sales settling an estate
• Forced sales resulting from a judicial order
• Sales of doubtful or questionable title
Staff should use careful judgment in their determination before coding sales as invalid.
Entering Sales Information
Once sales data is collected by staff,the next phase begins with the entering of the data in the computer
system. Entering includes the actual entering of sales information with proper coding as well as scanning
the sales verification information into the appropriate property account. This electronic file will be
permanently stored in the account image location so that confirmation of the sales price is readily
attainable. The District has a documentation form for staff to use when entering sales information. Sales
&Research staff will either enter the information/documentation in the mainframe database themselves or
will give to the appraisal support specialist to enter in the database(and excel spreadsheet if appropriate).
Proper coding and entering is essential to maintain a consistency in the quality and integrity of sales data
to help appraisers in their analysis and ratio studies. A system of type, source and validity codes was
established to define salient facts related to a property's purchase or transfer. Sales is not only stored in
the mainframe database but also sometimes in excel spreadsheets. The following is a set of established
codes and types that are utilized by the Denton Appraisal District to provide consistency in entering sales
data:
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INSTRUCTIONS/CODES TO USE FOR ENTERING SALES
UNDER THE "SALE CONFIRMATION"SCREEN
IF"SOURCE"OF SALES INFORMATION IS FROM:------------------------ "SOURCE"CODE TO USE
COSTAR CO'
M LS M
SETTLEMENT STMT OR ANY OTHER TYPE OF CLOSING DOC SS
SALES LETTER SL
FEE APPRAISAL/APPRAISER A
BROKER B
CONFIDENTIAL (AT TAXPAYER'S REQUEST) C _
ANY OTHER SOURCE OTHER
UNDER THE "SALE INFORMATION"SCREEN
IF"SALE TYPE"IS FROM ANY OF THESE----------------------------------- "SALE TYPE"CODE TO USE
MLS/COSTAR/LOOPNET Cl(CONFIDENTIAL WITH IMPROVEMENTS)CL CONFIDENTIAL LAND ONLY)
CONFIDENTIAL (AT TAXPAYER'S REQUEST) C (CONFIDENTIAL)
For"confidential sales,always remember to check the"confidential"box.
SALES LETTER I (FOR IMPROVED SALES) L (FOR LAND ONLY SALES)
SETTLEMENT/CLOSING/HUD STATEMENT I (FOR IMPROVED SALES) L (FOR LAND ONLY SALES)
APPRAISER OR COMPS USED IN A FEE APPRAISAL I (FOR IMPROVED SALES) L (FOR LAND ONLY SALES)
BROKER I (FOR IMPROVED SALES) L (FOR LAND ONLY SALES)
FEE APPRAISAL(ON SUBJECT PROPERTY) A
IMPROVEMENT"PARTIAL COMPLETE" IPC
ISRT (IMPROVEMENT"SHORT SALE")
CISRT (CONFIDENTIAL IMPROVEMENT"SHORT SALE")
LA (LAND APPRAISAL)
LC (LAND CONFIDENTIAL)
FOR LAND ONLY SALES,ALWAYS BE SURE TO CHECK THE"LAND ONLY SALE"BOX IN THE"SALE INFORMATION SCREEN"
IF THE SALE IS A FORECLOSURE:------------------------------ "SALE TYPE" CODE TO USE
FI (FORECLOSURE WITH IMPROVEMENTS) NON CONFIDENTIAL
FL (FORECLOSURE LAND ONLY) NON CONFIDENTIAL
FCI (FORECLOSURE CONFIDENTIAL WITH IMPROVEMENTS)
FCL (FORECLOSURE CONFIDENTIAL LAND ONLY)
TYPE OF SALE-------------------------------------------------------- "RATIO"CODE TO USE
ARMS LENGTH OR FORECLOSURE SALES V(VALID)
ATYPICAL SALES,IE:(FAMILY/RELATED PARTIES) I (INVALID)
FI(FORCLOSURE INVALID)
U(UNCONFIRMED)
The appraisal support specialist is responsible for organizing incoming and outgoing sales documentation
and fee appraisal reports/data. The specialist will coordinate with other departments to make sure sales
and fee appraisal documentation is gathered and entered properly. The Sales &Research Supervisor is
also responsible to oversee the collection and entering process of sales data and work closely with the
appraisal support specialist.
Sale Adjustments
Sales should be adjusted to represent only the value of the real property as of the assessment date.
Adjustments to the sale price may be considered or needed if any of the following exist:
• Assumptions(non-market rates)
• Closing costs (if atypical or seller paid)
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• If included delinquent taxes paid by buyer
• Special financing(non-market rates or terms)
• Gift programs
• Personal property included in sale
• Repair allowances
• Time
• Business value (goodwill)
This is especially true for nonresidential properties. The real property tax is based on the market value of
real property alone as of a specific date. This value may not be the same as investment value and should
not include the value of personal property or financing arrangements.
If adjustments for more than one purpose are to be made,they should be made in the following order:
• Adjustments that convert the price to a better representation of the market value as of the date of
sale.
• Adjustments that develop or isolate the price paid for taxable real property.
• Adjustments for differences in market value levels between the date of sale and the date of
analysis (time adjustments)
Time adjustments should be based on market analysis and be appropriately supported. Acceptable time
adjustment techniques are as follows:
• Tracking sales-to-appraisal ratios over time
• Including date of sale as a variable in regression or feedback models
• Analyzing resales
• Paired sales analysis
On all adjustments,the Denton Appraisal District will use appropriate and accepted methods as set forth
in the standards of the International Association of Assessing Officers (IAAO)and/or the Uniform
Standards of Professional Appraisal Practice(USPAP).
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2.65 Procedures for Analyzing and Adjusting Sales Prices
One of the primary responsibilities of the Denton Appraisal District is estimating the market value of each
property within the jurisdiction. The integrity of the property tax is dependent on the accuracy of the
estimates of market value established by the Appraisal District. This is accomplished by analyzing market
data to determine the price that the property being appraised would probably bring in the marketplace on
the date of appraisal. Sales data analysis ensures that only sales that meet the definition of market value
and that have been appropriately adjusted(if needed)are used in developing these estimates of market
value. Accuracy is dependent upon proper verification and adjustment of sales data. Once sales data is
collected, appraisers and appraisal support specialist are required to analyze the source of the sales price,
terms and conditions of the sales price (if possible),motivations of the sales price (if possible) and any
other factors that could influence the validity of the sales price. This requires reviewing the source and
making contact with the parties involved in the sales transactions to ascertain more details of the sale or
clarify conditions of the sale. This can be done by phone calls,written request,email or personal
interviews.
Sale Adjustments
Sales should be adjusted to represent only the value of the real property as of the assessment date.
Adjustments to the sale price may be considered or needed if any of the following exist:
• Assumptions(non-market rates)
• Closing costs (if atypical or seller paid)
• If included delinquent taxes paid by buyer
• Special financing(non-market rates or terms)
• Gift programs
• Personal property included in sale
• Repair allowances
• Time
• Business value (goodwill)
This is especially true for nonresidential properties. The real property tax is based on the market value of
real property alone as of a specific date. This value may not be the same as investment value and should
not include the value of personal property or financing arrangements.
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If adjustments for more than one purpose are to be made,they should be made in the following order:
• Adjustments that convert the price to a better representation of the market value as of the date of
sale.
• Adjustments that develop or isolate the price paid for taxable real property.
• Adjustments for differences in market value levels between the date of sale and the date of
analysis (time adjustments)
Time adjustments should be based on market analysis and be appropriately supported. Acceptable time
adjustment techniques are as follows:
• Tracking sales-to-appraisal ratios over time
• Including date of sale as a variable in regression or feedback models
• Analyzing resales
• Paired sales analysis
On all adjustments,the Denton Appraisal District will use appropriate and accepted methods as set forth
in the standards of the International Association of Assessing Officers (IAAO)and/or the Uniform
Standards of Professional Appraisal Practice(USPAP).
2.66 Value Defense Procedures for Informal Meetings and Formal Hearings
Informal Meetings
During the appeals process,the Sales&Research Department staff will sometimes need to help out other
departments. This involves informal meetings with property owners and/or authorized tax agents to
discuss any errors, discrepancies of market value and/or equity, and any claims of exemptions or special
valuations(agricultural use,restricted values, etc.)The informal review may be handled by mail, in
person, email or telephone. The review allows for communication and mutual understanding,which will
reduce the number of formal appeals. Informal reviews should incorporate the following basic steps:
• Verify the parcel information
• Exchange information
• Record the nature of complaint
• Use cost, sales or income information when appropriate to confirm property value
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• If a value change is indicated, change the value and enter into a signed agreement
• If value change is not warranted,explain proper appeal rights and procedures
Appraisers in the Sales &Research Department must get written approval from an appropriate manager
or supervisor to settle any property with an appraised value of$50,000,000 or higher.
Formal Hearings
Appraisal Review Board hearings(formal appeals) are the next step in the appeals process. Prior to the
hearing,the property owner/agent should be given a copy of the evidence the appraiser plans to use in the
hearing(if requested). The appraiser should be prepared to present factual information relating to the
property, such as tax maps,pictures of the property, improvement drawings, etc. as well as valuation
information,the cost,market and income approaches to value. If there is an equity component to the
appeal,the appraiser should be prepared to present a reasonable sample of equity comparables based on
sales, income, as appropriate.
2.67 Procedures for Responding to the Public
Disclosure of Records
The District shall comply in all respects with the Texas Open Records Act and Government Code Chapter
552. District staff shall ensure that all requests for records will be responded to timely,professionally and
courteously. Any request for records that are or may be confidential by law shall be promptly transmitted
to legal counsel for appropriate response.
Definition of Public Information
"Public Information"means information that is collected, assembled, or maintained under a law or
ordinance or in connection with the transaction of official business:
1. by a governmental body; or
2. for a governmental body and the governmental body owns the information or has a right of
access to it.
Requests for Information
The District may from time to time receive verbal or written requests for information that would not
necessarily constitute a"record"of the District. This would include questions concerning procedures and
practices engaged in by the District but not the subject of any written policy or rule. District staff shall
endeavor to answer such requests and questions whenever possible and practical, subject to the exceptions
below.
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Staff may decline to respond to public request and questions not covered by the Open Records Act in the
following instances:
a. Where legal counsel determines that such information should not be disclosed.
b. Where the information sought has been previously provided to the requester.
c. Where the Board of Directors and the Chief Appraiser determines that a response would
require an unreasonable expenditure of time or would interfere with a staff member's job duties.
d. Where the information sought can be derived from written records of the District through an
open records request,or by the District's public access computer terminal or website. (but in such
cases,the requester will be informed of the existence and availability of such records).
e. Where the Chief Appraiser has determined that the request is made for the purpose or has the
effect of harassment, annoyance,interference with District operations, or other similar reasons.
2.68 Reproduction Costs of Open Records
The Denton Central Appraisal District will make available records for public examination under the
guidelines of the Texas Open Records Act(Texas Government Code, Chapter 552). It is not the Districts
intention to deny anyone access to records that are considered"open"for public examination.
Furthermore,the District upon receiving a written request from the interested party,will reproduce
requested information in the original form for a reproduction fee that is recommended by the State
Purchasing and General Services Commission.
A. Statutory Reference
552.228. Providing Suitable Copy of Record Within Reasonable Time
It shall be a policy of a governmental body to provide a suitable copy of a public record within a
reasonable time after the date on which the copy is requested.
552.261. Determining Cost of Copies
(a)A governmental body may not charge an excessive amount for noncertified,photographic
reproductions of public records composed of pages that are legal size or smaller.
(b)The cost of obtaining a standard or legal size photographic reproduction shall be an amount
that reasonably includes all costs related to reproducing the record,including costs of materials, labor, and
overhead,unless the request is for 50 or fewer pages of readily available information.
(c)The General Services Commission shall periodically determine guidelines for the actual cost
of standard size reproductions and shall periodically publish these cost figures for use by governmental
bodies in determining charges under this subchapter.
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552.262. Cost for Nonstandard Records
The charge for access to public records that are comprised in a form other than standard or smaller sized
pages, or that are in computer records banks,microfilm records, or other similar record keeping systems
shall be set:
(1)making every effort to match the charge with the actual cost of providing the record;
(2)after consultation between a governmental body's officer for public records and the General
Services Commission; and
(3)in an amount that reasonably includes all costs related to providing the record,including costs
of materials, labor, and overhead.
COST OF COPIES OF OPEN RECORDS
Texas Administrative Code (Title 2, Chapter 111)
It will be the policy of the Denton Central Appraisal District to follow the guidelines of the office of the
Attorney General when determining charges for reproductions.
From time to time,the Denton Central Appraisal District will exchange information with parties outside
the district office. The consideration for supplying the information will be the information we receive
from the other party.
Cost of Copies of Public Information from the Texas Administrative Code:
(a)The charges in this section to recover costs associated with providing copies of public information are
based on estimated average costs to governmental bodies across the state. When actual costs are 25%
higher than those used in these rules, governmental bodies other than agencies of the state,may request an
exemption in accordance with §111.64 of this title(relating to Requesting an Exemption).
(b)Copy charge.
(1) Standard paper copy. The charge for standard paper copies reproduced by means of an office
machine copier or a computer printer is$.10 per page or part of a page. Each side that has recorded
information is considered a page.
(2)Nonstandard copy. The charges in this subsection are to cover the materials onto which
information is copied and do not reflect any additional charges,including labor,that may be associated
with a particular request. The charges for nonstandard copies are:
(A)Diskette--$1.00;
(B)Magnetic tape--actual cost;
(C)Data cartridge--actual cost;
(D)Tape cartridge--actual cost;
(E)Rewritable CD(CD-RW)--$1.00;
(F)Non-rewritable CD(CD-R)--$1.00;
(G)Digital video disc(DVD)--$3.00;
(H)JAZ drive--actual cost;
(I) other electronic media--actual cost;
(J)VHS video cassette--$2.50;
(K)Audio cassette--$1.00;
(L)Oversize paper copy(e.g.: 11 inches by 17 inches, greenbar,bluebar,not including maps and
photographs using specialty paper--See also §111.69 of this title)--$.50;
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(M) Specialty paper(e.g.: Mylar,blueprint,blueline,map,photographic--actual cost.
(c)Labor charge for programming. If a particular request requires the services of a programmer in order
to execute an existing program or to create a new program so that requested information may be accessed
and copied,the governmental body may charge for the programmer's time.
(1)The hourly charge for a programmer is $28.50 an hour,which includes fringe benefits. Only
programming services shall be charged at this hourly rate.
(2)Governmental bodies that do not have in-house programming capabilities shall comply with
requests in accordance with§552.231 of the Texas Government Code.
(3)If the charge for providing a copy of public information includes costs of labor, a
governmental body shall comply with the requirements of§552.261(b) of the Texas Government Code.
(d)Labor charge for locating,compiling, and reproducing public information.
(1)The charge for labor costs incurred in processing a request for public information is $15 an
hour,which includes fringe benefits. The labor charge includes the actual time to locate, compile, and
reproduce the requested information.
(2)A labor charge shall not be billed in connection with complying with requests that are for 50
or fewer pages of paper records,unless the documents to be copied are located in:
(A)Two or more separate buildings that are not physically connected with each other; or
(B)A remote storage facility.
(3)A labor charge shall not be recovered for any time spent by an attorney, legal assistant, or any
other person who reviews the requested information:
(A)To determine whether the governmental body will raise any exceptions to disclosure
of the requested information under the Texas Government Code, Subchapter C, Chapter
552; or
(B)To research or prepare a request for a ruling by the attorney general's office pursuant
to §552.301 of the Texas Government Code.
(4)When confidential information pursuant to a mandatory exception of the Act is mixed with
public information in the same page, a labor charge may be recovered for time spent to redact,blackout,
or otherwise obscure confidential information in order to release the public information.A labor charge
shall not be made for redacting confidential information for requests of 50 or fewer pages,unless the
request also qualifies for a labor charge pursuant to Texas Government Code, §552.261(a)(1)or(2).
(5)If the charge for providing a copy of public information includes costs of labor, a
governmental body shall comply with the requirements of Texas Government Code, Chapter 552,
§552.261(b).
(6)For purposes of paragraph(2)(A) of this subsection,two buildings connected by a covered or
open sidewalk, an elevated or underground passageway,or a similar facility, are not considered to be
separate buildings.
(e) Overhead charge.
(1)Whenever any labor charge is applicable to a request, a governmental body may include in the
charges direct and indirect costs, in addition to the specific labor charge. This overhead charge would
cover such costs as depreciation of capital assets,rent,maintenance and repair,utilities, and
administrative overhead. If a governmental body chooses to recover such costs, a charge shall be made in
accordance with the methodology described in paragraph(3)of this subsection.Although an exact
calculation of costs will vary,the use of a standard charge will avoid complication in calculating such
costs and will provide uniformity for charges made statewide.
(2)An overhead charge shall not be made for requests for copies of 50 or fewer pages of standard
paper records unless the request also qualifies for a labor charge pursuant to Texas Government Code,
§552.261(a)(1) or(2).
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(3)The overhead charge shall be computed at 20%of the charge made to cover any labor costs
associated with a particular request. Example: if one hour of labor is used for a particular request,the
formula would be as follows: Labor charge for locating, compiling, and reproducing, $15.00 x .20=
$3.00; or Programming labor charge, $28.50 x .20=$5.70. If a request requires one hour of labor charge
for locating,compiling, and reproducing information($15.00 per hour); and one hour of programming
labor charge ($28.50 per hour),the combined overhead would be: $15.00+$28.50=$43.50 x .20=
$8.70.
(f)Microfiche and microfilm charge.
(1)If a governmental body already has information that exists on microfiche or microfilm and has
copies available for sale or distribution,the charge for a copy must not exceed the cost of its reproduction.
If no copies of the requested microfiche or microfilm are available and the information on the microfiche
or microfilm can be released in its entirety,the governmental body should make a copy of the microfiche
or microfilm. The charge for a copy shall not exceed the cost of its reproduction. The Texas State Library
and Archives Commission have the capacity to reproduce microfiche and microfilm for governmental
bodies. Governmental bodies that do not have in-house capability to reproduce microfiche or microfilm
are encouraged to contact the Texas State Library before having the reproduction made commercially.
(2)If only a master copy of information in microform is maintained,the charge is $.10 per page
for standard size paper copies,plus any applicable labor and overhead charge for more than 50 copies.
(g)Remote document retrieval charge.
(1)Due to limited on-site capacity of storage of documents, it is frequently necessary to store
information that is not in current use in remote storage locations. Every effort should be made by
governmental bodies to store current records on-site. State agencies are encouraged to store inactive or
non-current records with the Texas State Library and Archives Commission. To the extent that the
retrieval of documents results in a charge to comply with a request,it is permissible to recover costs of
such services for requests that qualify for labor charges under current law.
(2)If a governmental body has a contract with a commercial records storage company,whereby the
private company charges a fee to locate,retrieve, deliver, and return to storage the needed record(s),no
additional labor charge shall be factored in for time spent locating documents at the storage location by
the private company's personnel. If after delivery to the governmental body,the boxes must still be
searched for records that are responsive to the request, a labor charge is allowed according to subsection
(d)(1)of this section.
(h)Computer resource charge.
(1)The computer resource charge is a utilization charge for computers based on the amortized
cost of acquisition,lease, operation, and maintenance of computer resources,which might include,but is
not limited to, some or all of the following: central processing units(CPUs), servers, disk drives, local
area networks (LANs),printers,tape drives, other peripheral devices, communications devices, software,
and system utilities.
(2)These computer resource charges are not intended to substitute for cost recovery
methodologies or charges made for purposes other than responding to public information requests.
(3)The charges in this subsection are averages based on a survey of governmental bodies with a
broad range of computer capabilities. Each governmental body using this cost recovery charge shall
determine which category(ies)of computer system(s)used to fulfill the public information request most
closely fits its existing system(s), and set its charge accordingly. Type of System--Rate: Mainframe-410
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per CPU minute;Midsize--$1.50 per CPU minute; Client/Server--$2.20 per clock hour;PC or LAN--
$1.00 per clock hour.
(4)The charge made to recover the computer utilization cost is the actual time the computer takes
to execute a particular program times the applicable rate. The CPU charge is not meant to apply to
programming or printing time;rather,it is solely to recover costs associated with the actual time required
by the computer to execute a program. This time, called CPU time, can be read directly from the CPU
clock, and most frequently will be a matter of seconds. If programming is required to comply with a
particular request,the appropriate charge that may be recovered for programming time is set forth in
subsection(d)of this section.No charge should be made for computer print-out time. Example: If a
mainframe computer is used, and the processing time is 20 seconds,the charges would be as follows: $10
/3 =$3.33; or$10/60 x 20=$3.33.
(5)A governmental body that does not have in-house computer capabilities shall comply with
requests in accordance with the §552.231 of the Texas Government Code.
(i)Miscellaneous supplies. The actual cost of miscellaneous supplies, such as labels,boxes, and other
supplies used to produce the requested information,may be added to the total charge for public
information.
0)Postal and shipping charges. Governmental bodies may add any related postal or shipping expenses
which are necessary to transmit the reproduced information to the requesting party.
(k) Sales tax. Pursuant to Office of the Comptroller of Public Accounts'rules sales tax shall not be added
on charges for public information(34 TAC, Part 1, Chapter 3, Subchapter O, §3.341 and §3.342).
(1)Miscellaneous Charges: A governmental body that accepts payment by credit card for copies of public
information and that is charged a"transaction fee"by the credit card company may recover that fee.
(m)These charges are subject to periodic reevaluation and update.
Format for Copies of Public Information
(a) If a requesting party asks that information be provided on computer-compatible media of a
particular kind and the requested information is electronically stored and the governmental body
has the capability of providing it in that format and it is able to provide it at no greater expense or
time,the governmental body shall provide the information in the requested format.
(b)The extent to which a requestor can be accommodated will depend largely on the technological
capability of the governmental body to which the request is made.
(c)A governmental body is not required to purchase any hardware, software or programming
capabilities that it does not already possess to accommodate a particular kind of request.
(d)Provision of a copy of public information in the requested medium shall not violate the terms of
any copyright agreement between the governmental body and a third party.
(e)If the governmental body does not have the required technological capabilities to comply with the
request in the format preferred by the requestor,the governmental body shall proceed in
accordance with §552.228(c) of the Public Information Act.
(f)If a governmental body receives a request requiring programming or manipulation of data,the
governmental body should proceed in accordance with§ 552.231 of the Public Information Act.
Manipulation of data under§552.231 applies only to information stored in electronic format
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2.69 Taxpayer Information on Open Records
The purpose of the following policy is to provide the employee's a succinct synopsis of the Texas Open
Records Act. The information in this section should always be referred to when a property owner asks
that their property records be sealed:
As required by the Texas Open Records Act, it is the policy of the Denton Central Appraisal District that
every person,upon request, is entitled to complete access to public information regarding governmental
affairs and the official acts of public officers and employees. Public information is defined as information
which is contained in documents,writings, letter,memoranda, or other printed,typed, copied, or
developed material which is collected, assembled, or maintained by or for the Denton Central Appraisal
District in accordance with laws or ordinances, or in connection with the transaction of official business.
Unless specifically exempted all such public information shall be made available to the public during the
Denton Central Appraisal District's normal business hours. Public information not accessible at the time
of the request will be made available within a reasonable time.
The District may not legally withhold from public inspection any documents except as specifically
allowed by law. The following information is not subject to public disclosure:
A. Rendition statements and real and personal property reports that are filed with the Denton
Central Appraisal District under the understanding that such statements or reports are to remain
confidential.
B. Information regarding real or personal property sales prices that is voluntarily disclosed to the
Denton Central Appraisal District after a promise that such information will remain confidential.
C. Information relating to the business affairs, operations,profits, losses or expenditures of a
taxpayer including,but not limited to,corporate taxpayers,which are obtained through an
examination of the taxpayers' books,records,papers or employees.
D. All federal tax returns or federal tax return information that a taxpayer is required to file with a
state tax return or report.
E. All applications for agricultural designation(1-d)which a taxpayer files with the Denton
Central Appraisal District's Chief Appraiser.
F. Statements, declarations, or reports filed with the Denton Central Appraisal District by either
motor vehicle dealers or vessel and outboard motor dealers for the purposes of assessing
inventory value for the tax year. (Effective 1-1-96)
G. All information that, if released,would give a competitor or bidder any type of unfair
advantage.
H. All information relating to the location of real or personal property to be used for public
purposes before any public announcement of the proposed project.
I. All information relating to the price of real or personal property to be used for a public purpose
before the award of contracts for the property.
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This list of exceptions is intended only to cover commonly received taxpayer records,and is not the
complete list of statutory exceptions to the requirement that records be open.
Sources:
1. V.A.T.C.S. Government Code §552.001, 552.002, 552.003, 552.021, 552.025,552.101,
552.104, 552.105 (West, 1994)
2. V.A.T.C.S. Tax Code §22.27,23.45,23.12(f),23.123, 111.006, 171.206 (West, 1994)
2.70 Taxpayer Liaison Officer
The Denton Central Appraisal District has a Taxpayer Liaison Officer (TLO). The primary focus of the
TLO is to improve the Appraisal District's relationship with the public and requires the TLO to be credible,
knowledgeable and responsive to the public with no conflicting interests. The duties and responsibilities
of the Taxpayer Liaison Officer may include:
• Resolving issues regarding the Board of Directors,the Chief Appraiser,or Denton Central
Appraisal District employees.
• May provide information and/or materials designed to assist property owners in understanding the
appraisal process,protest procedures,taxing unit matters and other related issues.
• Reporting to the board at each meeting(if necessary)on inquiries or public complaints filed and
their status. Reports to the Board may be an oral or written presentation and may include the
nature of the issues and concerns with a follow up to ensure their resolution.
In addition,the taxpayer liaison officer may handle public access and informational matters. The liaison
officer also resolves complaints that fall outside the jurisdiction of the appraisal review board. At each
regular meeting of the board,the taxpayer liaison officer reports on the number,nature and status of
resolution on any complaints (if any).
The TLO also coordinates many administrative matters for the ARB. If you are having some difficulty
with the protest system, or have questions concerning the ARB, contact the TLO. If your question cannot
be resolved directly,you will receive an appropriate referral to someone who can help you.
The Taxpayer Liaison Officer contact information will be posted on the Appraisal District's website to
help accessibility to the public.
The Texas Property Tax Code defines the Taxpayer Liaison Officer as:
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§6.052. Taxpayer Liaison Officer
(a)The board of directors for an appraisal district created for a county with a population of more than
125,000 shall appoint a taxpayer liaison officer who shall serve at the pleasure of the board. The taxpayer
liaison officer shall administer the public access functions required by Sections 6.04(d), (e), and(f), and is
responsible for resolving disputes not involving matters that may be protested under Section 41.41.
(b)The taxpayer liaison officer may provide information and materials designed to assist property owners
in understanding the appraisal process,protest procedures, and related matters.
(c)The taxpayer liaison officer shall report to the board at each meeting on the status of all complaints
filed with the board under Section 6.04(g).
(d)The taxpayer liaison officer is entitled to compensation as provided by the budget adopted by the
board of directors.
(e)The chief appraiser or any other person who performs appraisal services for the appraisal district for
compensation is not eligible to be the taxpayer liaison officer for the appraisal district.
Added by Acts 1989, 71st Leg.,ch. 796, § 8,eff. Jan. 1, 1990.Amended by Acts 1991, 72nd Leg., ch.
371, § 2,eff. Sept. 1, 1991;Acts 2007, 80th Leg., ch. 1086, § 1,eff. Sept. 1,2007.
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SUBSECTION 3. APPRAISAL OF BUSINESS PERSONAL PROPERTY
3.01 Introduction
A. Definition of ApTraisal Responsibility
The Business Personal Property Department of the Denton Central Appraisal District(DCAD)is
responsible for developing fair and uniform market values for all taxable Business Personal Property
accounts in the DCAD.
B. Legal and Statutory Requirements
The provisions of the Texas Property Tax Code (TPTC)and relevant legislative measures involving
appraisal administration and procedures control the work of the appraisal district. The district is
responsible for appraising property on the basis of its market value for ad valorem tax purposes for each
taxing unit that imposes ad valorem taxes on property in the district. The district is required to
periodically reappraise all property at least once every three years. DCAD reappraises property each
year.
C.Administration Requirements
DCAD subscribes to the standards of the International Association of Assessing Officers (IAAO)
regarding its appraisal practices and procedures. DCAD also subscribes to the standards promulgated by
the Appraisal Foundation known as the Uniform Standards of Professional Appraisal Practice(USPAP).
The Business Personal Property Department submits annual budget requests to the Deputy Chief
Appraiser and is bound to produce mass-appraisal estimates on Business Personal properties within the
cost constraints of said budget.
D. Appraisal Resources
Personnel-The Business Personal Property Department staff consists of a manager, a supervisor, four
field appraisers assigned to geographic areas and three information specialists. The manager reports to
the Deputy Chief Appraiser.
E. Scope of Work
The Business Personal Property Department of the Denton Central Appraisal District(DCAD)is
responsible for developing fair and uniform personal property values for all industrial,business, and
mineral properties.
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3.02 General Policies and Procedures
The most difficult tasks encountered by an appraiser are the discovery and assessment of personal
property. The law requires that all property not specifically exempt be taxed. However,because personal
property is easily concealed and frequently moved and because of the need to determine situs, and
ownership,the taxation of personal property is more difficult than the taxation of real property.
Items not permanently affixed to or part of real estate is generally considered to be personal property. To
differentiate between real and personal property the appraiser must consider the manner in which the
property is attached or secured in the location,the purpose for which the property is used and whether it is
to remain permanently affixed or be removed at some time. A general rule is that an item is personal
property if it can be removed without serious injury to the real estate or to the item itself.
A. Data and Research
It is the goal of this department to gather information that can be used to establish class schedules and
verify that values placed on DCAD Appraisal Rolls are as accurate as possible.
Any information that would indicate value will be considered.
When information is received from whatever source,it is verified by personal contact,third party
information,or direct access to financial information.
Staff will work with any reliable source to acquire information.
B. Education and Training
All employees shall have the knowledge and expertise to do their job. Each employee will have a
minimum educational standard required for their position. In addition,DCAD will supply the following:
1. On the job training—each employee will receive training on procedures,policy,and equipment by their
supervisor and other employees in similar positions.
2. State required education and registration—all employees so required will achieve and maintain their
own educational and registration requirements.
3. Additional training and education—from time to time,additional training and education will be
required to enhance job performance,knowledge and expertise.
Employees will be expected to perform to an acceptable standard.
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C. Work Schedule Timeline
August 1st—September 1st—Discovery Process
September I'—February lst—Review, survey, &analyze existing accounts and value new accounts.
February 1 st—April 1st—Price, evaluate, and process renditions.
April 2"d—May 1st—Process renditions
May 3'—Approximate Date to Mail Notices
May 18t1i—June 15t1i—Formal hearings, interviews,and settle values.
June 16'—July 31 st—Prepare for discovery
3.03 Methods of Discovery
Since most personal property is movable in nature,the most difficult step in the assessment of personal
property is developing a system of discovery and recognizing the appropriate trade level.
How Business Personal Property is appraised:
The application of appraisal for the purposes of Business Personal Property is divided into the categories
of variable and fixed.
Fixed tasks include recognizing,inspecting and setting up new accounts,review and reappraisal of an
assigned geographical area as well as deleting accounts that have ceased doing business. This category is
for accounts that have a single physical location.
Variable accounts are accounts that may have multiple locations or be specialty accounts. Multiple
location accounts include leased equipment,telecommunications,utilities,pipelines and billboards.
Specialty accounts include tenant accounts and special inventory accounts for auto,boat,heavy
equipment and manufactured housing dealers.
The BPP department also reviews accounts that were not rendered in the previous year. Also accounts are
reviewed that may have been questioned and a different value applied based on comparable property type.
Due to the dynamic nature of personal property, information gathered from certified renditions,verified
balance sheets,invoices, and asset listings verified through national cost services(Marshall&Swift and
other appropriate sources)have been determined as the best comparable and benchmarks for the property
being valued. This process can be used to develop pricing guides by property type. Property type is noted
by classification referenced by an SIC CODE. The information is then converted into a price per square
foot representation multiplied by the square footage of the subject.
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Benchmark Properties—Personal Property does not normally lend itself to being tested by benchmark
sales. The best indicators of a benchmark for personal property are certified renditions,balance sheets,
invoices, and asset listings.Marshall and Swift valuation software is also used as a test and adjunct tool in
assisting in developing benchmarks.
Fixed Tasks—These accounts are taken from the previous year's certified roll. They are generated in an
account ledger format sometimes carried in book form,but in the case of the Denton BPP department an
Apple iPad. This allows for immediate account conformation and entry of recognized new accounts.
Fixed accounts are separated into geographical areas. These areas are based upon cities and school
districts. Within these areas certain designated accounts are noted for special attention.This category
includes properties that did not file a rendition the previous year or the rendition filed was questioned and
was not used for the property's valuation.
Each appraiser inspects every account on their route.Upon inspecting the accounts on the assigned route,
the appraiser verifies and makes any appropriate change. Sources that can be used as an adjunct to aid
them in their task of identifying new accounts are: certificates of occupancy,newspaper articles and
business journals.
Variable accounts—Variable accounts are represented by leased equipment,telecommunications,utilities,
mineral and VIT accounts. These accounts are rendered by electronic transmission. The information is
reviewed and entered by the assigned staff. The rendered and depreciated information is then incorporated
into the final value for the current year.
A. Business Personal Property Rendition
The use of a personal property rendition is by far the most important method of discovering personal
property. This method requires that the appraisal district develop and use suitable rendition forms and
vigorously pursue their accurate completion by taxpayers. The rendition process is particularly important
for commercial, industrial and utility taxpayers whose inventory, equipment and supplies constitute a
large part of their taxable property.
The rendition is often used by the appraiser to obtain information necessary for the appraiser to apply the
districts own depreciation schedules to equipment,furniture and fixtures;the rendition does not
necessarily contain requisite information for such depreciation calculations.
The Business Personal Property Rendition is due on or before April 1". All renditions must be signed and
completed.An additional 30 days if requested in writing will be approved.Any additional extensions past
the original 30 days must show cause and be approved by the Chief Appraiser.
Properties that do not comply with the deadlines will be subject to a 10%penalty. A property owner can
request in writing a waiver from the 10%penalty if goods cause is shown. The Appraiser is responsible to
research the request and all information on the account to determine if a penalty can be waived.
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B. Prior Year Tax Roll
A review of the prior year's tax roll is a good base from which the appraiser can work. Although
particular items may change from year to year,the basic nature of the property will remain unchanged in
most cases.
C. Publicized Material
The use of newspapers,press releases and trade journals will often assist the appraiser in locating the
addition of personal property that results from new businesses opening or old businesses expanding
within his jurisdiction.
D. Telephone and City Directories
Telephone and city directories are particularly valuable in locating commercial, service or industrial
operations new to the jurisdiction.
E. Physical Inspection
Visual inspection to assure that all taxable personal property is assessed is used by the appraiser an
assigned area of the appraisal district.
F. Registration Records
County vehicle registration records are the best source for vehicle information. These lists provide most
of the information necessary to assess such property.
G. Federal Government Records
The FAA supplies data consisting of the name and addresses of airplane owners and a description of the
type of planes they own.
H. Building Permits
Building permits also will indicate the existence of new business or the replacement of one business for
another when existing commercial property is remodeled.
I. Sales Tax Listing
Business or"sales tax"lists from the State Comptroller's office are also good sources for discovering the
existence of many businesses that otherwise may go unnoticed,along with providing ownership and good
mailing address information.
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J. County Clerk DBA Records
These are filings that are recorded at the County Clerk's office stating the assumed name of the company.
3.04 Procedures for Informal Meetings and Participating in Appraisal
Review Board Hearings
The appeals process begins with an informal meeting between the appraiser and the property owner to
discuss any errors, discrepancies of market value and/or equity, and any claims of exemptions or special
valuations(Freeport, abatement, foreign trade, etc.). The informal review may be handled by mail, in
person,or by telephone. The review allows for communication and mutual understanding,which will
reduce the number of formal appeals. Informal reviews should incorporate the following basic steps:
1)Initiate inquiry record; 2)Verify the parcel information; 3)Exchange information;4)Record the nature
of complaint; 5)Use cost, sales, or income information to confirm property value; 6)If a value change is
indicated,the appraiser will change the value and enter into a signed agreement with the property owner;
7)If a value change is not warranted,the appraiser should explain the appeal rights and procedures, in
case the property owner wishes to make a formal appeal.
Appraisal Review Board hearings(formal appeals) are the next step in the appeals process. Prior to the
hearing,the property owner should be given a copy of the evidence the appraiser plans to use.
Formal Hearings—The appraiser is given the responsibility of identifying protested accounts that fall
within their scope of responsibility. Any information that was incorporated in the valuing of the account
is to be presented at the hearing. Each side is given an opportunity to present their information before the
ARB gives their decision.After the board gives their decision a board order is mailed informing the
protester of the decision if there is a change.
A. Procedures on Maintaining Confidential Information
All confidential information(renditions, contracts,balance sheets,etc.)are kept secure and prohibited
from public view. Confidential documents must be requested in writing and the persons requesting must
be the owner, agent, or an authorized employee of the business.
3.05 Situs and Inspection of Personal Property
Field Instructions—The appraiser is instructed and will endeavor to be aware of the accounts that are on
their route. As to the extent that personal property can be assessed depends on its discovery.
A. Situs of Personal Property
Another difficult task in assessing personal property is determining the situs of the property for taxation
purposes. The general rule in taxation of personal property is that a taxing jurisdiction can only assess
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property that has situs within its boundaries. The basic law for determining situs of personal property
involves identifying the owner's intent for the property. If personal property has not acquired an actual
situs of its own by being located at one place more or less permanently,it is taxable at the domicile of the
owner. Expansion of situs questions can be found in the States General Appraisal Manual,the Property
Tax Code,and personal property course texts.
B. Measurement of Area
The appraiser must measure the area in which inventory is held for sale or stored for future use and apply
the averaging density factor tables for like property to arrive at a consistent estimate of value.
C. Property Inspection
The personal property appraiser should first inspect the property to be appraised. Next,the appraiser
should examine or audit the books and records of the business to be appraised if the financial statements
are available. From the inspection and examination,basic data may be extracted for the appraisal of the
operating unit.
The inspection and audit program should develop the following basic data:
1. Source of costs declared by the taxpayer
2. Reliability of cost information
3. Condition ofproperty
4. Description of the property by item or class
S. Year acquired—new or used
6. Economic(Useful)Life—by item or classes
D. Evaluation of Inventory
Items of inventory must be evaluated in bulk as a class or category assessable to a particular taxpayer,
unlike other items of"tangible personal property"(furniture and fixtures,machinery, equipment and
vehicles)which,under normal circumstances, are to be evaluated and assessed separately. In the
recognized methods of evaluation of inventory on an aggregate or bulk basis,the appraiser should first
determine the level of trade; i.e.,manufacturing,wholesale or retail at which the inventory is held. The
product of this method would be the amount that would be received by the taxpayer in a sale of the total
of such items of inventory assessable to him,to another person,firm or corporation who would continue
the business. The principal of substitution dictates that inventory value would be the replacement cost to
the owner of an acceptable substitute having comparable utility.
Business personal property accounts that are valued over 2 million will be reviewed by the supervisor or
manager.
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All freeport and abatement applications will be reviewed by the supervisor or manager of the department.
All pollution control accounts will be reviewed by the supervisor or manager.
E. Data Entry Procedures
Example of the process that the appraiser uses to acquire information from the account records by queries.
Queries:
• Query 1: Route by city(query will produce results for each city separately and saved in excel on
F: drive).
• Query 2: out-of-city route. Query results will be everything out of city limits. (Query will be
saved in excel on F: drive).
• Query 3: DBA route. Query results pull all L1 &L2 accounts in Denton County in DBA order.
(Query will be saved in excel on F: drive).
Printing:
• Query 1: route by city—print 1 master copy
• Query 2: out-of-city route—print 1 master copy
• Query 3: DBA route—print 1 master copy
• All route information is placed on iPads.
Color Coding for iPads:
• Red—delete
• Green—active(no data entry needed)
• Yellow—requires data entry. Explain in comments exactly what needs to be changed
• Pink—recheck,revalue, etc.
• Blue -tenant list
Data Entry:
• Clerical staff will make all necessary changes to account
• The date and initial will be put in the done section when any changes are made
• Changes will be made by clerk on the appraisers in days
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New Accounts:
• Appraiser will use new card template when setting up a new account
• After appraiser types up new card it will be emailed to BPP Helpdesk
• Clerical staff will check BPP Helpdesk inbox
• Once clerical staff sets up new account and scans the document, it will be dropped in that
appraisers new account folder located on the Shared(F:)drive in the BPP folder.
• Appraiser will check new account folder. Check all data entry in PACS and add any additional
information needed to account
Quality Control:
• Supervisor will check each appraisers worked folder. Weekly reports are turned into Manager
and Supervisor. Supervisor conducts field checks of each appraisers work.Appraisers are
monitored to be in their work areas at their assigned times.
3.06 Estimation of Property Value
The method used to value personal property is usually controlled by such considerations as the type of
property,whether there is an active and open market for such property and specific information as age,
quality or quantity. The key to mass appraisal of personal property revolves around standardizing the
method of processing data and applying the three traditional approaches to value. The market-data
approach,the cost approach and the income approach can be applied in assessing personal property
through the use of renditions, schedules and appraisal guides that are developed and used by the appraisal
district. Inventory that is bought in bulk quantities must meet the test of an arm's length sale and should
not include business liquidation. In determining the"market value"of items of inventory,the appraiser
should consider the invoice cost,the condition of the inventory and other factors as required by law,or
recognized using generally accepted accounting practices (GAAP),and correctly employs generally
accepted appraisal techniques or methods(GAAT)to produce and communicate credible appraisals. The
appraiser shall endeavor not to commit a substantial error of omission or commission that significantly
affects a mass appraisal nor render a mass appraisal in a careless or negligent manner.
A. On-Site Appraisal
An"on-site"appraisal will be made of each individual,firm,partnership, co-partnership, association,
society, corporation, or any other legal entity that owns,holds, or uses personal property in connection
with a business or profession. Established accounts will be rechecked annually and new accounts will be
established upon discovery.
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Appraisers will make a detailed report for each business visited to include:
—Business Name and Location
—Owner, Principal Officer, or Representative
—Mailing Address (If different)
—Business Telephone Number
—Person Contacted(At the business)
—Date Business Opened(New accounts only)
—County, City, School, and/or Special District
—Refused Entry and By Whom
—Square foot area occupied and leased
—Appropriate listing and description of Personal Property
—Property by category showing quality, condition, density of material, etc.
—Method or Technique and appraisal approach utilized
—Disclose any extraordinary assumptions or limiting conditions that effect value
and indicate the impact
—Appraised Value
—Initials of Appraiser and Name of any Assisting Appraiser
—Date of Appraisal
Each DCAD Personal Property Account is identified by a unique computer assigned account number and
a business type using the Standard Industrial Classification System, and a property use code. Accounts
are maintained on the Personal Property worksheet and kept in the appraisers' office files(see below).
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B. BPP Pricing
The BPP manual is the current version used by the Property Tax Division of the State Comptroller's
office utilized in ratio studies,and adopted for use by the Denton Central Appraisal District. The BPP
manual gives guidelines for appraising property in this manner. The following pages detail how the
density tables are to be used as supplied in the manual. All depreciation tables referred to are 2001
revised 2002 &2003 for purposes of these following examples;values for business are estimated as if
being appraised for the 2001 tax year.
INVENTORY
D (Quality)
E FAIR AVERAGE GOOD
N LOW 1 4 7
S
I AVERAGE 2 5 8
T
Y HIGH 3 6 9
FURNITURE,FIXTURES,&EQUIPMENT
D FAIR AVERAGE GOOD
E
N LOW 1 4 7
S
I AVERAGE 2 5 8
T
Y HIGH 3 6 9
Figure 1 Pricing Grids
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Shown in Figure 1 is a blank sample of the pricing"grids"The top grid is for"Inventory"while the lower
is for"Fixed Assets." Across the grid are three(3)columns headed FAIR,AVERAGE, and GOOD.
Generally, speaking,these columns represent the estimated"Quality"of the inventory or fixed assets.
Reading from top to bottom and down the left hand side,can be seen LOW,AVERAGE, and HIGH.
Again, generally speaking,these headings indicate the estimated amount or quantity of inventory. As can
be seen, Class"5"is the center point of the pricing system. Realistically all adjustments up or down
should start from this point as"average"is the most common and therefore the easiest,most accurate
point of reference.
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Hardware Store
Table 5251
INVENTORY
(Quality)
D FAIR AVERAGE GOOD
E
N LOW 1 8.00 4 15.00 7 27.00
S
I AVERAGE 2 10.00 5 18.00 8 32.00
T
Y HIGH 3 13.00 6 22.00 9 40.00
FURNITURE,FIXTURES&EQUIPMENT
(Quality)
D FAIR AVERAGE GOOD
E
N LOW 1 1.00 4 5.00 7 10.00
S
I AVERAGE 2 2.00 5 6.00 8 12.00
T
Y HIGH 3 4.00 6 8.00 9 14.00
*Most hardware stores will be in the Fair and Average FF&E columns.
Percent Good .90 .80 .70 .60 .50 .40 .30 .20 .10
Age lyr. 2yrs. 3yrs. 4yrs. 5yrs. @s. 7yrs. @s. 9+yrs.
Figure 2 Density Tables
Using Figure 2,the first example used is a 5,860 sq. ft. hardware store that was established in 1995. After
obtaining all pertinent information to set up the account, it is estimated that this location has average
quality inventory with average density. The fixed assets are estimated to be average for this business but
in well-maintained condition. The effective age is estimated for the year 1997.
By indexing the inventory table,this location is classed a"5"with a price of$18.00 per sq. ft. The fixed
asset table also indicates a class"5"for$6.00 per sq. ft. After checking the depreciation table under a ten
(10)year life,we find that the fixed assets are estimated to be 60%good for a 1997 asset purchase.
In this example,the value is estimated as follows:
Inventory 5,860 sq. ft. @ $18.00= $105,480
Fixed 5,860 sq. ft. @ $ 6.00 X 60%= 21,096
$126,576
In the second example,we have another hardware store with a size of 4,725 sq. ft. The inventory quality
and mix are very similar to what is normally seen. However, it appears there is more of it on the shelves
rather than in the stock room. The fixtures are older wooden examples that were normally seen in the
1940's and 1950's period with wear and tear typical to fixtures of that age. For this example, date
established is estimated in 1952.
In estimating the value for this location,we are classing the inventory as average with a higher density.
By checking the grid,the"class"for this location for inventory is a"6"or$22.00 per sq. ft. The fixtures
will be classed"2"or$2.00 per sq. ft. with the depreciation schedule indicating 20%remaining.
(Not going below"normal"ten year life figure as fixtures are still in use and in"average"condition for
fixtures of that age.) Therefore,overall effective age is 1993.
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The value on this business is estimated below:
Inventory 4,725 sq. ft. @$22.00 = $103,950
Fixed 4,725 sq. ft. @ 2.00 X 20%= 1,890
$105,840
C. The Historical or Original Cost
1. Cost Determination
The cost as shown on the accounting records reflects different cost"basis"for items acquired. The
property may have been acquired by cash purchase;by contract on a deferred payment plan; by exchange,
or trade;by issuance of securities or other property;by self-construction;by gift or discovery; or by other
cost"basis." Accountants generally adhere to the base price established at the time the property was
acquired. This principle has wide acceptance in the accounting profession. The property accounts
seldom depart from the historical price base to reflect depreciated values of the assets.
However,the accounting term cost typically is referred to as the cost of acquiring an asset on the date of
acquisition. Thus the value recorded for the assets of a company may be described as the"all inclusive"
costs. The accounting records generally have property acquisitions reported on an"original"cost basis.
These accounts may be adjusted for the determination of depreciation, etc. The cost then would be on an
"adjusted"cost basis.
2. Examination ofAccounting Records
The appraiser should examine the books and records of the business. The accounting records may be a
complete or standard set of records or a modified system of records. The report of the appraiser should
indicate what records were examined and describe the type of records examined for the appraisal. A
determination must be made as to the cost basis used to record property in the records. This cost basis
should reflect the minimum cash outlay necessary for the acquisition of the property. This cash outlay
should also represent all the expenditures up to the time the property is put to its ultimate use. The
appraiser must determine the cost basis recorded for either new or used property and if it is representative
of the current value at the time of acquisition.
The historical or original cost may be the only reliable source data available for the appraisal of personal
property. The source data may reflect historical costs for new or used property according to the date of
acquisition. The appraiser may have to adjust the cost basis of the accounting records if these costs do not
reflect"current value at the time of acquisition." The historical or accounting cost bases, after appraisal
adjustments, are factored to current replacement costs new.
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D. Invoice Cost
Appraisers should first consider the taxpayer's invoice cost. Such cost should include delivery or freight
charges but not sales tax if any, and should be reduced by any trade quantity, cash or similar substantiated
discounts allowed to the taxpayer. The condition of the goods, including depreciation and appreciation
may indicate an adjustment in value from invoice cost. Invoice cost should be reduced when losses in
value occur due to damage, shrinkage, out of season,out of style,or similar factors that reduce the market
value of the inventory below the invoice cost. When aging or curing or other similar factors enhance
value, invoice cost should be increased to reflect this appreciation. In certain situations,the value of
inventory consisting of work in process may increase as the manufacturing process continues. In this
situation,the invoice cost must be increased to reflect this appreciation.
E. Flat Pricing
On accounts that do not fall into a"class"or where actual figures are known,do not use the Density
Tables when a different figure is needed for the final value estimate. This final estimate is entered(on the
worksheet and terminal)as a flat price figure. On locations where verification has been presented or
obtained,the appraiser is also expected to flag the worksheet and computer(there is a specific field for
this purpose on each)that the location's value is verified. A file(referred to as a"data file")must be set
up and maintained with supporting documentation. This is then available to the personal property
supervisor for checking and analysis.
F. Fixed Asset Depreciation
As with all appraisals,depreciation based on effective age is the critical variance to the final estimate of
value. Therefore,to audit depreciation more closely, overall effective age of the fixed assets is a requisite
of the appraiser to make the pricing system work. Furthermore, it requires all appraisers district wide to
use the Depreciation Tables for standardization and appraisals that are more"fair and equal." This
information can then be analyzed on a printout with other businesses in the same category where a
comparison of values will be more meaningful with better conclusions being achieved by the appraisers.
G. Economic Life
1. Measuring Economic Life
The physical life of a property is that period extending from the time a piece of equipment is new until it
is physically no longer usable or has had a substantial amount of life restored by rebuilding. The
economic life of a property is the estimated time measured from the date the item is new until the
disappearance of its capacity to produce a greater yield than its expense or upkeep. Without economic
and functional obsolescence, economic and physical life may be identical. Economic life may be greater
than, equal to,or less than the physical life of an item.
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2. Estimation of Economic Life
The appraiser should estimate the reasonable economic life for commercial type property by item.
Commercial type property usually has a longer economic life than other types of personal property. This
is due to limited use, enhanced design,better maintenance and less obsolescence. Guidelines for
economic lives are found in the IRS Code,the Marshall Valuation Service manual, and other sources
using generally accepted appraisal practices(GAAP).
3. Economic Life Tables
The appraiser judges the economic life by physical inspection of the property and determination of the
actual use of the property. As a guide the appraiser may use Depreciation Guidelines Life Expectancy
Tables by the predominate use of the property. The tables are supplied with the BPP manual. The
appraiser must then select the economic life for a particular property based on operating conditions,
experience of the industry, and his informed judgment.
H. Percent Good Tables
Depreciation is estimated by the use of a remaining value or Percent Good Table. Normal depreciation
allows for the decline in value of the property over its estimated economic life. The rate of depreciation
or Percent Good Table relates not only to the measurement of time,but to other factors as well. Some of
these particular factors are the operating policies regarding repairs,maintenance, and replacement. The
other factors affect normal depreciation and must be considered by the appraiser to estimate the current
value of any personal property. The use of the property has an effect on the remaining economic life and
the current value. Depreciation rates are based on average condition for age.
The appraiser has determined the Replacement Cost New(RCN). An economic life has been assigned to
the property. The appraiser determines the following
1. Replacement Cost New(RCN)=28,250(assumed number for example)
2. The assigned life of 10 years,on a composite rate.
3. The age of the property is determined to be eight(1993-2001)years.
4. Using the Percent Good Table,he finds 20%remaining value for average condition. This is determined by using the 10 year
Normal Depreciation column and the age of 8 years. The estimated remaining life indicated is 2 years.
5. The Replacement Cost New(RCN)multiplied by the percent good(%)(remaining value)gives the appraiser the estimate of
Replacement Cost New Less Normal Depreciation(RCNLND).
The following is an example of estimating the replacement cost less normal depreciation, using the Percent
Good Table:
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1. Replacement Cost New,RCN=$28,25
2. Normal Life— 10 years
3. Age of Property—8 years
4. Percent Good Table—Normal Depreciation 10 years
5. Percent Good(Remaining Value)20%
6. RCN$28,250 X Percent Good 20%
7. $28,250 X 20%=$5,650 RCNLND
Figure 3 Using Percent Good
Using Figure 3,the replacement cost new is adjusted for depreciation according to age. Next,
depreciation is considered in view of the condition of the property. This depreciation is based on physical
factors, and can be less, equal to or greater than depreciation from age only.
I. Trending Factors
A cost index, such as in Marshall& Swift, is designed to show specific rates and directions of price
movements. Cost Indexes' are used to trend historical cost to current costs. The index is converted to
factors using the year before the appraisal year as the base year. The costs data used in appraising
property are generally historical costs. Historical costs are factored to current costs by the use of
conversion factors.
1. Determine the historical or acquisition cost from the books and records. The cost basis must be
representative of current value at the time of acquisition. These costs should be factored by compositions
grouped or summarized within years of acquisition.
2. Determine the factor which is to be used based on the acquisition date.
3. Multiply the original cost by the factor.
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The result is the trended historical cost or the estimate of the replacement cost new.
The following is an example of estimating Replacement Cost New(RCN)using the 1992 Cost Factors:
SMALL OFFICE—FURNITURE&FIXTURES
1. Cost Basis=$10,000
2. Acquisition Date 1983
3. Replacement Cost Factor= 132
4. Cost$10,000 X 132%_$13,200=RCN
Using Cost Index Factor
Cost basis is trended to estimate Replacement Cost New(RCN). These costs are factored by the use of
conversion factors. Finally,the estimate of the economic life or remaining life of the property is made.
Normal depreciation is then applied to the value. The RCNLND is the result of using the cost factors and
the Percent Good Column.
J. Obsolescence
In the appraisal of commercial personal property as in all other types of property,the problem of
obsolescence must be considered in estimating value. The appraiser should consider obsolescence a
factor in the valuation of any property. Obsolescence may be defined as loss of value caused by
technological change or innovation, changes in demand of product, or other causes.
1. Functional Obsolescence
When the loss of value is due to technological change or innovation, it is usually referred to as functional
obsolescence. It can be recognized by lack of utility in the property; inadequate capacity or size. Since
the obsolescence is present in the property(i.e.,lack of capacity or size)it can sometimes be overcome by
remodeling.
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2. Economic Obsolescence
When the loss of value is due to change in product or demand, it is customarily referred to as economic
obsolescence. Economic obsolescence is caused by external factors and cannot be overcome.
3. Measurement of Obsolescence
Obsolescence is not difficult to recognize in personal property,but it is difficult to measure with accuracy.
This is because obsolescence is best measured by market evidence. Adequate market evidence of value
cannot always be found for all types of personal property. The appraiser should look to the market for
any evidence of value loss due to obsolescence after having estimated the value using the cost approach.
Appraisers must consider what an informed purchaser is willing to pay for this property as an operating
unit on a going concern basis.
The appraiser will first determine Replacement Cost New Less Normal Depreciation(RCNLND.) The
ratio of the RCNLND to the RCN should be compared to the overall condition of the operating unit.
Then consideration must be given for an adjustment due to obsolescence; economic, functional, or both.
To estimate the amount of obsolescence,the appraiser must use good appraisal judgment. A review of all
the external and internal factors, including market evidence should be employed whenever available.
K. Salvage& Scrap Value of Personal Property
There are times when the appraiser in the field encounters a business that has remodeled or replaced worn
out equipment,but older/idle equipment remains on the company books. This equipment has value,if
only salvage or scrap,which must be considered in the valuation of the business. Salvage value is the
price at which the owner can dispose of an asset after its useful service life has expired. The price usually
includes removal of all or part of the property from the premises for use elsewhere,usually with
refurbishing. Scrap value is the lowest value property will have and is measured for its content(pounds
of iron, aluminum, copper,etc., or other component parts)to be used for recycling.
L. Procedures for Verifying the Accuracy of Work
All renditions are verified and checked by the appraiser. The supervisor takes random samples from each
employee.
Various value reports are reviewed to ensure equality,uniformity and accuracy are accomplished.
M. Procedures on Accepting Renditions and Assessing or Waiving Penalties
The Business Personal Property Rendition is due on or before April 1St. All renditions must be signed and
completed. An additional 30 days if requested in writing will be approved. Any additional extensions
past the original 30 days must show good cause and be approved by the Chief Appraiser.
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Properties that do not comply with the deadlines will be subject to a 10%penalty. A property owner can
in writing request a waiver from the 10%penalty if good cause is shown. The Appraiser is responsible to
research the request and all information on the account to determine if a penalty can be waived.
Utility accounts maintained by an outside appraisal firm are updated from the computer generated listing
provided by the firm.
O. Policies and Procedures for Performing,Analyzing and Using Internal Ratio Studies
Analysis
The District utilizes internal computer generated queries to help in ascertaining proper ratios. The queries
are performed to locate outlier spread. This would include properties that increased by more than the
designated percentages and amounts. This would give an indicator of properties that fell outside the
indicated ranges. Summary statistics including,but not limited to,the median,weighted mean, and
standard deviation provide the analysts an analytical tool by which to determine both the level and
uniformity of appraised value by SIC code. Review of the standard deviation can discern appraisal
uniformity.
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DENTON CENTRAL APPRAISAL DISTRICT
PERSONAL PROPERTY WORK SHEET
PROP ID: NV:
BUSINESS NAME:
OWNER'S NAME:
SITUS LOCATION:
MAILING ADDRESS:
PHONE NUMBERS:
PROPERTY LINKED
DESCRIPTION: PROPERTY STATE
R CODE: SIC:
TAXING UNITS: 20 EXEMPTIONS/COMMENTS
1.INVENTORY-GOODS,WARES,MDSE
SF:
2.FURNITURE&FIXTURES
SF:
3.MACHINERY&EQUIPMENT
4.VEHICLES
YEAR MAKE TYPE LIC#
TOTAL:
APPRAISER: DATE: INFO FROM:
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BILLBOARD VALUATION WORKSHEET
(1)NAME OF COMPANY: (2)DATE:
(3)PERSON TO CONTACT: (4)NUMBER:
(5)COUNTY NAME: (6)TELEPHONE:
(7)LOCATION OF STRUCTURE&BILLBOARD#:
(8)NEAREST ADDRESS&ENTITIES:
(9)NEAREST LOCATION:
(10)ORIGINAL CONSTRUCTION DATE: (11)AGE(IN YEARS):
(12)TYPE OF CONSTRUCTION(WOOD,STEEL,MONOPOLE):
(13)CLASS:
(14)HAGL: (15)ILLUMINATION:YES NO
(16)LARGEST DISPLAY SURFACE:
(17)NUMBER OF DISPLAY SURFACES:
(18) PLATFORM# YES NO
(19)APRON# YES NO
BASE PRICE PER SQUARE FOOT X SQ FT= (A)
NUMBER OF ADDITIONAL SURFACES X PER SURFACE_ (B)
BASE STRUCTURE COST= (C)
(ADD A&B)
CONSTRUCTION ADJUSTMENTS
HAGL-BASE STRUCTURE COST X PERCENTAGE_ (D)
MONOPOLE-BASE STRUCTURE COST X PERCENTAGE_ (E)
STACKS-BASE STRUCTURE COST X PERCENTAGE_ (F)
TOTAL ADJUSTED BASE COST= (G)
TOTAL OFC+(D,E,&F)
ADDITIONAL IMPROVEMENTS
ILLUMINATION-#OF SURFACES X PER SURFACE_ (H)
PLATFORM-PER LINEAR FOOT X LINEAR FEET= (I)
APRON-PER LINEAR FOOT X LINEAR FEET= (J)
TOTAL OTHER ADDITIONS= (K)
(ADD H,I,&J)
REPLACEMENT COST NEW(RCN) (L)
(ADD G&K)
VALUATION OF BILLBOARD
REPLACEMENT COST NEW RCN(L) X PCT GOOD=
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BILLBOARD SCHEDULE
CLASS 1 CLASS 2 CLASS 3 CLASS 4
$30 $60 $90 $490
SINGLE FACED SINGLE FACED SINGLE FACED
WOOD CONSTRUCTION STEEL CONSTRUCTION STEEL CONSTRUCTION SINGLE DIGITAL
CLASS 1+ CLASS 2+ CLASS 3+ CLASS 4+
$45 $80 $115 $670
DOUBLE FACED DOUBLE FACED DOUBLE FACED DOUBLE FACED
WOOD CONSTRUCTION STEEL CONSTRUCTION STEEL CONSTRUCTION DIGITAL
ALL COMPONENTS ARE CONSIDERED TO BE IN PLACE: LIGHTS,PLATFORMS,&APRONS.
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DENTON CENTRAL APPRAISAL DISTRICT
Business Personal Property Department
PO BOX 50764 Denton.TX 76206 • 3901 Morse Street,Denton,TX 76208
Dept 940-349-3950 Metro 972-434-2602 Fax 940-349-3951
For additional fortes and resources visit our website at www.dodonead.corn
This document must be filed with the appraisal district office fn the county in which your property is taxable It must not be Fled with the office
of the Comptroller of Public Accounts.Location and address Information for appraisal district offices may be found at
wwwwmndow state.tx.uslorocertvtaxlreferencesldirectorvlcad
Business Name&Current Mailing Address: Account Number.
Property Loudon Address:
Property Owner Agents Name,Address,&Phone Number:
Owner's Phone Number:
Description of Business(optional):
Questions 1-6 optional
1. If any of the above information is not correct,please make the necessary changes. The last day to file this rendition is April 1.
2. Business Type is(check one): ❑Individual or sole proprietorship ❑Partnership ❑Society ❑Corporation
3. Square Footage of building occupied:
4. ❑ Leased space ❑ Owned space
5. Sales Tax Permit Number:
6. Please provide this information if the business has sold,closed or moved to a new location:Please check one
❑ Business Sold—Date Sold:
Name,Address&Phone Number of Buyer:
❑ Business Closed
Date business closed:
❑ Business Moved—Date Moved:
Location business was moved to:
If you have previously filed a rendition form and it remains an accurate rendition of your property for this year,you may check the box below and sign
this form.
❑ By checking this box I affirm that the information contained in my most recent rendition statement filed for a prior tax year(this rendition
was filed for the tax year)continues to be complete and accurate for the current tax year.
GENERAL INSTRUCTIONS:This form is for use in rendering,pursuant to Tax Code§22.01,tangible personal property used for the production of
income that you own or manage and control as a fiduciary on January 1 of this year.
FILING AND DEADLINES:Rendition statements and property reports must be delivered to the chief appraiser after January 1 and not later than April
1,except as provided by Tax Code§22.02.On written request by the property owner,the chief appraiser shall extend a deadline for filing a rendition
statement or property report to May 1.The chief appraiser may further extend the deadline an additional 15 days upon good cause shown in writing by
the property owner.Pursuant to Tax Code§22.02,if an exemption applicable to a property on January 1 tenninates during the tax year,the person
who owns or acquires the property on the date applicability of the exemption terminates shall render the property for taxation within 30 days after the
date of termination.If the chief appraiser denies an application for an exemption for property subject to rendition pursuant to Tax Code§22.01(a),the
person who owns the property on the date the application is denied shall render the property for taxation in the required manner within 30 days after
the date of denial-
1
198
INSPECTION OF PROPERTY:Pursuant to Tax Code§22.07,the chief appraiser or his authorized representative may enter the premises of a
business,trade,or profession and inspect the property to determine the existence and market value of tangible personal property used for the
production of income and having a taxable situs in the district.
REQUEST FOR STATEMENT REGARDING VALUE:Pursuant to Tax Code§22.07,the chief appraiser may request,either in writing or by electronic
means,that the property owner provide a statement containing supporting information indicating how value rendered was determined.The property
owner must deliver the statement to the chief appraiser,either in writing or by electronic means,not later than the 21 st day after the date the chief
appraisers request is received.The statement must:
(1)summarize information sufficient to identify the property,including:
(A)the physical and economic characteristics relevant to the opinion of value,if appropriate;and
(B)the source of the information used;
(2)state the effective date of the opinion of value;and
(3)explain the basis of the value rendered.
If the property owner is a business with 50 employees or less,the property owner may base the estimate of value on the depreciation schedules used
for federal income tax purposes.Failure to comply in a timely manner is considered to be a failure to timely render and the Tax Code requires that
penalties be applied by the chief appraiser.
PENALTIES:The chief appraiser must impose a penalty on a person who fails to timely file a required rendition statement or property report in an
amount equal to 10 percent of the total amount of taxes imposed on the property for that year by taxing units participating in the appraisal district.The
chief appraiser must impose an additional penalty on the person equal to 50 percent of the total amount of taxes imposed on the property for the tax
year of the statement or report by the taxing units participating in the appraisal district if it is finally determined by a court that:
(1)the person filed a false statement or report with the intent to commit fraud or to evade the tax;or
(2)the person alters,destroys,or conceals any record,document,or thing,or presents to the chief appraiser any altered or fraudulent record,
document,or thing,or otherwise engages in fraudulent conduct,for the purpose of affecting the course or outcome of an inspection,investigation,
determination,or other proceeding before the appraisal district.
SPECIAL INSTRUCTIONS:Effective January 1,2014,certain dealers of motor vehicle inventory may elect to file renditions under Tax Code,Chapter
22,rather than file declarations and tax statements under Tax Code,Chapter 23.Tax Code,Section 23.121(a)(3)allows a dealer to make this election
if it(1)does not sell motor vehicles that are self-propelled and designed to transport persons or property on a public highway;(2)meets either of the
following two requirements:(a)the total annual sales from the inventory,less sales to dealers,fleet transactions,and subsequent sales,for the
preceding tax year are 25%or less of the dealer's total revenue from all sources during that period,or(b)the dealer did not sell a motor vehicle to a
person other than another dealer during the preceding tax year and the dealer estimates that the dealers total annual sales from the dealers motor
vehicle inventory,less sales to dealers,fleet transactions,and subsequent sales,for the 12-month period corresponding to the current tax year will be
25%or less of the dealers total revenue from all sources during that period;(3)files with the chief appraiser and the tax collector by August 31 of the
tax year preceding January 1 on a forth prescribed by the comptroller a declaration that the dealer elects not to be treated as a dealer under Tax
Code,Section 23.121 in the current tax year;AND(4)renders the dealers motor vehicle inventory in the current tax year by filing a rendition with the
chief appraiser in the manner provided by Tax Code,Chapter 22.A dealer who makes this election must file the declaration annually with the chief
appraiser and the tax collector by August 31 of the preceding tax year,so long as the dealer meets the eligibility requirements of law.
Effective January 1,2014 a dealer of heavy equipment inventory may render its inventory by filing a rendition statement or property report as provided
by Tax Code,Chapter 22.If the dealer files a rendition,the dealer is not considered to be a dealer as defined by Tax Code,Section 23.1241(a)(1).A
heavy equipment inventory dealer has the option to render or file declarations and tax statements,without filing additional declarations with the chief
appraiser or tax collector.
Tax Code,Section 22.01(c-1)states:
In this section:
(1) "Secured party'has the meaning assigned by Section 9.102,Business&Commerce Code.
(2) "Security interest"has the meaning assigned by Section 1.201,Business&Commerce Code.
Tax Code,Section 22.01(c-2)states:
With the consent of the property owner,a secured party may render for taxation any property of the property owner in which the secured party has a
security interest on January 1,although the secured party is not required to render the property by Subsection(a)or(b).This subsection applies only
to property that has a historical cost when new of more 0ian$50,000.
Tax Code,Section 22.01(d-1)states:
A secured party is not liable for inaccurate informahon included on the rendition statement if the property owner supplied the information or for failure
to timely file the rendition statement if the property owner failed to promptly cooperate with the secured party.A secured party may rely on information
provided by the property owner with respect to
(1) The accuracy of information in the rendition statement.
(2) The appraisal district in which the rendition statement must be filed,and
(3) Compliance with any provisions of this chapter that require the property owner to supply additional information
The Property Tax Assistance Division at the Texas Comptroller of Public Accounts provides property tax information and resources for taxpayers.local
taxing entities.appraisal dishicts and appraisal review boards.
For more information,visit our websue:www window slate tx.usltaxrnfo/nrodtax
2
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DEFINITIONS
Personal Property: Every kind of property that is not real property;generally,property that is movable without damage
to itself or the associated real property.
Inventory:Personal Property that is held for sale to the public by a commercial enterprise.
Type/Category: Functionally similar personal property groups. Examples: furniture,fixtures,machinery,equipment,
vehicles,and supplies. Narrower groupings such as personal computers,milling equipment,freezer cases,and forklifts
should be used,if possible.A person is not required to render for taxation personal property appraised under Section
23.24.
Estimate of Quantity: For each type or category listed,the number of items,or other relevant measure of quantity(e.g.,
gallons,bushels,tons,pounds,board feet).
Property Address:The physical address of the personal property on January 1 of the current tax year. Normally,the
property is taxable by the taxing unit where the property is located.
Address Where Taxable: In some instances,personal property that is only temporarily at its current address may be
taxable at another location(taxable situs). If you know that this is the case,please list the address where taxable.
Good Faith Estimate of Market Value:Your best estimate of what the property would have sold for in U.S.dollars on
January 1 of the current tax year if it had been on the market for a reasonable length of time and neither you nor the
purchaser was forced to buy or sell. For inventory,it is the price for which the property would have sold as a unit to a
purchaser who would continue the business.
Historical Cost When New:What you paid for the property when it was new,or if you bought the property used,what
the original buyer paid when it was new. If you bought the property used and do not know what the original buyer paid.
state what you paid with a note that you purchased it used.
Year Acquired:The year that you purchased the property.
Consigned Goods:Personal property owned by another person that you are selling by arrangement with that person.
If you have consigned goods,report the name and address of the owner in the appropriate blank.
Fiduciary:A person or institution who manages property for another and who must exercise a standard of care in such
management activity imposed by law or contract.
Secured Party:A person in whose favor a security interest is created or provided for under a security agreement.
whether or not any obligation to be secured is outstanding,a person that holds an agricultural lien,a consignor,a person
to which accounts.chattel paper,payment intangibles,or promissory notes have been sold.a trustee,indenture trustee.
agent,collateral agent,or other representative in whose favor a security interest or agricultural lien is created or
provided for;or a person that holds a security interest arising under Sections 2.401,2.505,2.711(c),2A.508(e),4.210,
or 5.118.
Security Interest:An interest in personal property or fixtures which secured payment or performance of an obligation.
"Security interest"includes any interest of a consignor and a buyer of accounts,chattel paper,a payment intangible,or a
promissory note in a transaction that is subject to Chapter 9."Security interest"does not include the special property
interest of a buyer of goods on identification of those goods to a contract for sale under Section 2.401,but a buyer may
also acquire a"security interest"by complying with Chapter 9.Except as otherwise provided in Section 2.505,the right
of a seller or lessor of goods under Chapter 2 or 2A to retain or acquire possession of the goods is not a"security
interest',but a seller or lessor may also acquire a"security interest"by complying with Chapter 9.The retention or
reservation of title by a seller of goods not withstanding shipment or delivery to the buyer under Section 2.401 is limited
in effect to a reservation of a"security interest."Whether a transaction in the form of a lease creates a security interest is
determined pursuant to Section 1.203.
3
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PART 2. GENERAL DESCRIPTION OF BUSINESS ASSETS
List all taxable personal property by typelcategory of property(See'Definitions").If needed you may attach additional sheets.Or,you may attach a
computer-generated copy listing the information below.If you manage or control property as a fiduciary on January 1,also list the names and
addresses of each property owner.
1. What do you estimate to be the total market value of your business assets(see the definition of market value)?
Under$20,000(optional:estimated value ).If you check this box,complete item#2 below,then skip to part 7,
$20,000 or more. If you check this box,skip to part 3,and complete all other parts of this forth.
When required by the chief appraiser,you must render any taxable property that you own or manage and control as a fiduciary on January 1[Tax
Code Section 22.01(b)].For this type of property,complete part 2,3.4 and/or 6,whichever is applicable.
When required by the chief appraiser,you must file a report listing the name and address of each owner of property that is in your possession or under
your management on January 1 by bailment,lease,consignment,or other arrangement[Tax Code Section 22.04(a)].For this type of property.
complete part 5.
Your estimate of market value should be based on the value of all tangible personal property owned by your business on January 1,including vehicles
less than 20,000.
2.
General property description by Property address or address Good Faith Estimate of Property owner name/address if you
type/category where taxable Market Value manage or control property as a
(optional)' fiduciary
PART 3. INVENTORY,RAW MATERIALS AND SUPPLIES
List all taxable inventory by type of property(example.merchandise,supplies,etc.).If needed you may attach additional sheets.Or,you may attach a
computer-generated copy listing the information below.If you manage or control property as a fiduciary on January 1,also list the names and
addresses of each property owner.If needed,attach additional sheets.If you carry consigned goods,also list below the names and addresses of each
consignor.
Historical Good faith Estimate
Property description Year cost when estimate of of quantity Properly address or address Property owner name/address,new"
by type/category Acquired" market value' of each where taxable if you manage or control
(and) or type property as a fiduciary
Subtotal
Work in Progress
Raw Materials
Total Inventory
Supplies
'If you provide an amount in the'good faith estimate of market value,'you need not complete a'historical cost when new"and"year acquired.'"Good
faith estimate of market value'is not admissible in subsequent protest,hearing,appeal,suit,or other proceeding involving the property except for:(1)
proceedings to determine whether a person complied with rendition requirement:(2)proceedings for determination of fraud or intent to evade tax;or
(3)a protest under Tax Code.Section 41.41,
If you provide an amount in a"historical cost when new and'year acquired,"you need not complete"good faith estimate of market value.'
4
201
PART 4. FURNITURE&FIXTURES,MACHINERY&EQUIPMENT.COMPUTERS,ELECTRONIC ITEMS,AND OTHER
FIXED ASSETS NOT INCLUDING VEHICLES
List all taxable personal property by typelcategory of property(See'Definitions").If needed you may attach additional sheets.Or,you may attach a
computer-generated copy listing the information below.If you manage or control property as a fiduclary on January 1,also list the names and
addresses of each property owner.If you carry consigned goods,also list below the names and addresses of each consignor.
Office Plant or Shop Computers
Furniture& Machines Motile Redio. Motile Descnbe
Fixtures Copier.Fax PBX Machinery 8 E w (PC 8 Miscellaneous
el Equipment q p meet Mainframe) Miscellaneous
Telephone
Estimate of
Market Value'
Instead of reporting an estimate of market value,you may report these assets by original cost and year of acquisition.If so,please fill out the table
below. List the original cost of each category of items by year acquired.Please place a total cost for all assets acquired before 20DO on the last line.If
you don't have original cost information by year available,check here Eland list cost for each category in the total line.
Office Plant or Strop
Furniture 8 Motile Radio, Mobile Computers(PC
Machines Machinery Miscellaneous Describe
Year Fixtures Copier,Fax PBX Equipment Equipment 8 Mainframe)
HCol.. Hisloncal q on Historical Historical
Historical Miscellaneous
Acquired" Histonnal Histoncal Cost—
Co Cost•• �.. Cogc Cost" Cost••
2017 S
2016 $
2015 S
2014 $
2013 $
2012 $
2011 $
2010 S
2009 $
2008 $
2007 $
2006 $
2005 $
2004 $
2003 S
2002 $
2001 $
2000 $
/prior
Totals
'If you provide an amount in the'good faith estimate of market value:you need not complete a'historical cost when new'and'year acquired.-"Good
faith estimate of market value'is not admissible in subsequent protest,hearing,appeal,suit,or other proceeding involving the property except for:(1)
proceedings to determine whether a person complied with rendition requirement:(2)proceedings for determination of fraud or intent to evade tax;or
(3)a protest under Tax Code Section 41.41.
"If you provide an amount in a"historical cost when new and year acquired,'you need not complete'good faith estimate of market value.'
5
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PART 5. LEASED,LOANED,CONSIGNED,OR RENTED PERSONAL PROPERTY
List the name and address of each property owner of taxable property that is in your possession or under your management on January 1 by bailment,
lease,consignment.or other arrangement.If needed you may attach additional sheets.Or,you may attach a computer-generated copy listing the
information below.
Name,Address.Phone q of Owner Description Selling Price if Staled in Annual Rent
Lease(Optional) O tional
PART 6. AUTOMOBILES,TRUCKS,TRAILERS,BUSES,AND SPECIAL EQUIPMENT MOUNTED ON THEM
List all taxable personal property by typetcategory of property(See'Definitions").If needed you may attach additional sheets.Or,you may attach a
computer-generated copy listing the information below.If you manage or control property as a fiduciary on January 1,also list the names and
addresses of each property owner.If you carry consigned goods,also list below the names and addresses of each consignor.
VEHICLES-continue on additional sheets if needed
Year Make and Model License Number Market Value' Location if Different from Original Cost" Date
(Optional) Business Location (Optional) Acquired-
(Optional)
tional)
SPECIAL EQUIPMENT MOUNTED ON VEHICLES-list below any special equipment-continue on additional sheets if needed
Equipment Description VIN of vehicle to which attached Estimate of Value' Original Cost" Year
(Optional) acquired-
(Optional)
tional
'If you provide an amount in the'good faith estimate of market value,-you need not complete a-historical cost when new and'year acquired." Good
faith estimate of market value is not admissible in subsequent protest,hearing,appeal,suit,or other proceeding involving the property except for;(1)
proceedings to determine whether a person complied with rendition requirement.(2)proceedings for determination of fraud or intent to evade tax;or
(3)a protest under Tax Code,Section 41.41.
"If you provide an amount in a'historical cost when new-and'year acquired,-you need not complete*good faith estimate of market value.'
PART 7.SIGNATURE AND AFFIRMATION
Are you the property owner,an employee of the property owner,or an employee of a property owner on behalf of an affiliated entity of the property
owner?_ Yes _No
This forth must be signed and dated.By signing this document.you attest that the information contained on it is true and correct to the best of your
knowledge and belief.
If you checked-Yes-above,sign and date on the first signature line below.No notarization is required.If you checked'No"above,(notarization is
required)you must complete the following.I swear that the information provided on this form is true and correct to the best of my knowledge and
belief.
Are you a secured party with a security interest in the property subject to this rendition and with a historical cost new of more than S50,000,as defined
and required by Tax Code,Section 22.01(c-1)and(c-2)?_Yes No
If you checked'Yes"to this question,you must attach a document signed by the property owner indicating consent for you to file the rendition.Without
the authorization,the rendition is riot valid and cannot be processed.
Owner/Agent Signature Date
Printed Name Title
Company Name Telephone No.
If you checked-No"to the first question on part 7,you must complete the following:
I swear that the information provided on this forth is true and correct to the best of my knowledge and belief.
Agent Signature Date
SUBSCRIBED AND SWORN TO BEFORE ME this the
Printed Name Title day of .20
Company Name Telephone No.
Section 22.26 of the Property Tax Code states (a)Each rendition statement or property report
required or authorized by this chapter must be signed by an individual who is required to file the
statement or report-(b)When a corporation is required to file a statement or report.an officer or
the corporation or an employee or agent who has been designated in writing by the board of
directors or by an authorized officer to sign in behalf of the corporation must sign the statement or
report. Notary Public,State of Texas
If you make a false statement on this form,you could be found guilty of a Class A misdemeanor or a state jail felony under
Section 37.10,Penal Code
6
203
♦?Jn N�
Yt
D
GLENN HECAR TEXAS COMPTROLLER OF PUBLIC,ACCOUNTS
December 15, 2017
Ginger Crowder
Denton CAD
Dear Ms. Crowder:
After a thorough review of the proposed 2018 Business Personal Property
rendition form submitted by the Denton CAD, the Property Tax Assistance
Division finds that the submitted form is in substantial compliance with the
Comptroller's form adopted by Comptroller Rule 9.3031.
If you have any further questions, please call or e-mail me at 1-800-252-9121,
extension 3-7685 or leslie,wardacpa.state.tx.us,
Sincerely,
Leslie K Ward
Information Specialist
Property Tax Assistance Division
C o m pt ro I l e r.Tex a s.G o v
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DENTON CENTRAL APPRAISAL DISTRICT
2018 CONSOLIDATED COST INDEX AND
DEPRECIATION SCHEDULE
FIXTURES AND EQUIPMENT
ACQUI- NORMAL USEFUL LIFE-YEARS
SITION
YEAR 3 4 5 6
2017 96 97 98 99
2016 95 96 97 98
2015 92 95 96 97
2014 89 94 95 96
2013 93 94 95
2012 92 93
2011 91
2010
2009
2008 33 41 61 78 77 80
2007 20 34 53 74 75 76
2006 31 44 69 70 72
2005 20 38 63 65 67
20G4 33 56 59 62
2003 31 49 54 58
2002 20 44 50 53
2001 37 43 48
2000 35 39 43
1999 20 35 38
1998 28 35
1997 20 30
Physical % good is computed on a straight line basis, with a 20% residual value for assets in use-in place
whose actual age exceed Normal Useful Life (except Billboards are with a 30% residual value). Assets at the
end of their useful life and not used by the owner will be priced at salvage value (below 20% residual).
Factors shown are net percentages.
TRANSPORTATION EQUIPMENT
Year Passenger Commercial Commercial
Model Cars/Pickups Trucks Trailers
Good % Good % Good
2017 85 60 56
2016 75 56 54
2015 65 53 53
2014 55 47 48
COMPUTER EQUIPMENT-ALL 2013 45 36 42
2012 40 34 38
Year Acquired % Good 2011 35 31 35
2017 75 2010 30 _28 32
2016 56 2009 25 25 30
2015 28 2008 20 22 28
2014 10 2007 20 26
2013 d Older 5 2006 24
2005 22
(Software is Exempt) 2004 20
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FIXTURES AND EQUIPMENT
NORMAL USEFUL LIFE
Aerospace Products(Airborne Vehicles&Component Parts)...... 10 Motion Picture&Television Production...............__..._._........... 12
Amusement&Theme Parks........................................................ 12 Motor Vehicle&Parts Manufacturing................. 12
Apparel&Fabricated Textile Mfg....„.......................................„..... 8 Motor Vehicle&Parts Mfg(Special Tools)......................... 3
Appliances..........................._...................»............................_._... 8 News Racks........................................_............................................ 5
Asphalt Plant............................................................................... 10 Office Furniture&Equipment.......................................................... 10
Automatic Car Wash................................................................„......... 10 Office Machines(Non-Computer Data handling).......................... 6
Automatic Teller Machine.................__............_......................... 5 Optical Lenses&Instruments Mfg.................................................. 10
Automobile Repair Shops............_...................................._........ 10 Paint&Varnish Manufacture..............._...................................... 10
Bakeries&Confectionery Products................................................. 12 Paper&Pulp Manufacturing............................................................ 12
Barber&Beauty Shops..................................................................... 10 Paving Contractors(Asphalt&Concrete)........................................ 8
Billboards............................................................................................ 30 Petroleum Refining...-..................................................................... 15
Brewery Equipment...._...... 12 Photo Finishing(Computerized Processing)......_».„„.......»...„... 5
Brick Manufacture.....................__......__.__..._._..._................. 15 Photo Finishing.................................................................................. 10
Buildings(Moveable)........._.............._._._..._._......_...._.._......_. 10 Plastic&Plastic Products Manufacturing.................................... 10
Cable TV/Satellite Systems(One orTwo Way Coomun.).............. 10 Plastic Products Mfg(Special Tools)................................................ 4
Canneries&frozen Food Production...........................................„.. 12 Point of Sale Equip(Scanners,Registers,etc.)............................... 5
CellularTelephone......................................................................_..... 3 Postage Machine........................................_................................. 10
Chemical&Allied production.................„.»....„»...__...„._...».. 10 Printing&Publishing................ 10
Clay Products Mfg................................ 15 Private Water System..................... 20
Cold Storage&Ice Making Equipment......__._......_....__..._._.. 18 Professional&Scientific instrumertts......__.__..._._...._......_._ 10
Cold Storage Warehouse Equipment.............................................. 10 Radio&Television,Broadcasting.................................................... 6
Computers&Peripheral Equip(Software Exempt)....................... tbl Radio&Television,Manufacturing.............................................._. 30
Concrete&Concrete Products Mfg(Batch Plants)........._._......... 15 Radio or Television Transmitting Tower............. 20
Condiments,Manufacturing&Processing..................„..„...»».„. 10 Radio Systems(Complete Two Way Systems)...„.».................... 8
Construction Equipment(heavy&General)........................ 6 Radio Systems(Radio only)................................._.„.„_...__.
Converted Paper,Paperboard&Pulp Products Mfg................._. 10 Recreation(Bowling,Billard,Pool,Min.Golf)............................... 10
CopyMachine.................................................................................... 6 Rental—Furniture............................................................................. 3
Dairy Products Manufacturing......................................................... 12 Rental—Tools,Equipment,Etc........................................................ 6
Data handling Equip-Typewriters,Calculators,Add Mach,Dupl.Eq. 6 Restaurant&Bar Equipment.................................................... 10
Dispensers—Cold Drinks................................................................... 5 Restaurant Equipment(Fast Food)........._»............._»...__».... 8
Distilling...................................................... 12 Retail trades,Fixtures&Equipment..._............_......_...__........ 10
Drilling/Field Services Equip(Oil&Gas)........................... 6 Rubber Products Manufacturing................................................. 14
Electrical Equipment Manufacturing................................. 10 Rubber Products Mfg(Special Tools).............................................. 4
Electronic Equipment Manufacturing...................... 6 Safes—Office.10 yrs.,Bank Vaults&Safe Dep............................. 20
Fabricated Metal Products(Special Tools)......._..._._._......_...._. 3 Satellite Dish&Related Electronic Equipment........................._. 10
Fabricated Metal Products.......................................„„._...».„...„. 12 Security Systems......................................................................_....... 10
Fax Machine............_......„._..._........._......_..................„.........._ 6 Service Establishment...................................................................... 10
ForkLift.................................................................._.».____....._..... 6 Service Station'....................................._......................................... 10
Glass/Fiberglass(Special Tools).............................. 3 Signs(Trade-Non Billboard)........................................................... 10
Glass/Fiberglass Manufacture&Products..................................... 14 Skates&Bowling Shoes................................................................. 6
Golf Carts............................................................................................ 6 Soft Drink Manufacturing&Bottling.........................._................ 12
Grain&Grain Products Mfg(Flours,Cereals,Livestock Feed)..... 15 Stone Products Manufacturing..................._......»..........._.......... 15
Hand Tools(Electrical&Manual)..................................................... 5 Sugar&Sugar Products Manufacturing ................ 18
HealthClub&Spas.......................................................................... 10 Tanning Machine......................................................_.................. 10
Hospital Furnishings&Equipment.................................................. 10 Telephone Station Equip(Private Branch Exc)......_................... 10
Hotel/Motel Furniture...................................................................... 10 Telephone Systems(Business)...................................._............„... 6
Jewelry,Musical Inst.Toys,Sport Goods,Office&Art Sup.......... 12 Theater Equipment......................................................»._..._....... 10
Laundry Equipment(Coin Operated)............................................. 8 Tire Recapping............................................................................... 14
Laundry Equipment(Dry Cleaning)........._..._......____...„._..... 10 Trash Handling Equipment(Truck/Containers)............................. 5
Law Library........................................... 5 Vehicles(Licensed).....................................
Leather&leather Products._..._.»...._»..._.._............»...„._..._.. 10 Vending Machines..............._......................._.................................. 5
Machinery Mfg(Non-specific types)........._._...„._....„_...__...... 10 Video Machines(Arcade&Rental Stores)..................................... 3
Meat Packing............................................. 12 Video Tapes<60 days-50%,<1 yr-20%,>1 yr-10%or$10 per tape
Medical Equipment(High Technology)...»_._»..._._._»»..._.». 5 Warehouse Equipment.................................................................... 10
Medical/Dental Trade Equipment............. 10 Waste Reduction&Resource Recovery.................................... 10
Metalworking Machinery Manufacturing.........__........._._......... 10 Wholesale Trade,Fixtures&Equipment........................._...»._. 10
Mining&Quarrying............................................. 10 Wood products&Furniture Manufacturing............................... 10
*Tanks 20 yr
Pumps,Console:Computer,Electronic.....5 yr
Other.................10 yr
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3.07 Motor Vehicle Dealer's Special Inventory
Instructions for Filing Forms and Paying Property Taxes
For property tax purposes,Texas law requires that a motor vehicle dealer's inventory is appraised based
on the total sales of motor vehicles in the prior year. Dealers must file with the county appraisal district a
Dealer's Motor Vehicle Inventory Declaration form listing the total value of the inventory sold in the
prior year.Also,the dealer must file with the county tax office a monthly form Dealer's Motor Vehicle
Inventory Tax Statement—listing the motor vehicles sold, and prepay their property taxes for each
vehicle. Instructions for filing both forms follow.
Texas law permits the Comptroller's office to act only as an advisory agency with regard to property
taxes. The Comptroller helps property owners and tax officials interpret the property tax laws. Texas law
also requires the Comptroller to adopt forms for filing the motor vehicle dealer's inventory.
Steps to calculate,report and pay dealer's inventory property taxes:
Step 1 —A dealer files the Dealer Motor Vehicle Inventory Declaration form.
• file one declaration per year;
• file each January,between January I and 31;
• file with the county appraisal district and send a copy to the county tax office; and
• if you are a new dealer, file a declaration form within 30 days of the issuance of the dealer's
general distinguishing number(GDN). A chief appraiser has the discretion to designate a
different date.
Step 2—A dealer reports current year's inventory market value.
Complete the following items on the Dealer's Motor Vehicle Inventory Declaration form:
• breakdown of sales for prior year(January—December);
• breakdown of sales amounts for prior year(January—December); and
• other general information about the retail business—mailing address,name and business
location.
207
Divide sales amounts for inventory sales by 12 for current year's market value:
• the current year's tax bills received in October will be based on this market value and the current
year's tax rates; and
• the inventory's market value is not the value of the dealer's motor vehicles on January 1 but an
average of the regular monthly inventory sales from the preceding year.
Penalties
The chief appraiser of the county appraisal district must report to the Texas Department of Transportation
any dealer that sells fewer than five vehicles in a prior year. The Department will begin dealer license
termination proceedings.
A dealer who does not file a declaration form by February 1 of each year commits a misdemeanor
punishable by a fine of up to $500 per day until filed.A tax lien can be attached to the dealer's business
personal property to secure payment of the penalty.A dealer forfeits an additional penalty of$1,000 for
each month or portion of the month that it is not filed.
Step 3—A dealer files the Dealer's Motor Vehicle Inventory Tax Statement:
• file 12 statements per year;
• file each month by the 1 Oth of the following month. For example, file January inventory tax
statement by February 10'.
• file with the county tax office, including a check for prepayment of taxes. Send a copy of the
form to the county appraisal district. If you do not sell a motor vehicle during the month,you
must file a tax statement indicating no sales; and
• if a new dealer, file each month,but do not send a prepayment of taxes.
Step 4—A dealer makes a prepayment of taxes.
Calculate the unit property tax factor.
• Find the aggregate tax rate by adding the preceding year's tax rates for each taxing unit that taxes
the retail business. Look either at the preceding year's tax bills or call the county tax collector.
Each property is taxed by a county and by a school district. It also may be taxed by a city and
special districts (such as a junior college and/or hospital district,depending on where the business
is located).
208
Example of 2004 tax rates:
County tax rate — $0.40
School tax rate = $1.40
City tax rate — $0.60
Special district — $0.05
tax rate
Aggregate = $2.45 per$100
rate of value
• Divide the aggregate tax rate by 12 for a tax rate per month.
Example: $2.45/12=$0.20417 per$100 of value.
• Divide the aggregate tax rate per month by$100 for a tax rate per$1.00 of sales price.
Example: $0.20417/$100=$0.0020417 rate per$1.00(unit property tax factor).
• Change the unit property tax factor each January to use the preceding year's tax rates.
Example: Use the 2004 adopted rates to determine the unit property tax factor for January
through December 2005.
Report and pay the unit property tax payment.
• Multiply the sales price of the motor vehicle by the unit property tax factor. Subtract the motor
vehicle's manufacturer's rebate from the sales price,but do not subtract the trade-in.
Example: $20,000 x$0.0020417=$40.83 in tax prepayment.
• Apply unit property tax factor to each motor vehicle sold in a month and report to the county tax
office, along with the tax prepayment. Send a copy of the monthly tax statement to the county
appraisal district. Remember, it is considered a sale, even if the motor vehicle is taken out of
Texas.
Step 5—A dealer files a report of inventory sales monthly.
Report the following on the Dealer's Motor Vehicle Inventory Tar Statement:
• date of sale;
• model year of motor vehicle;
• make of motor vehicle;
• vehicle identification number;
209
• purchaser's name;
• type of sale:
A. MV—regular motor vehicle inventory sale—a motor vehicle is a fully self-propelled
vehicle with at least two wheels which has the primary purpose of transporting people or
property and includes a towable recreational vehicle. Motor vehicle does not include
equipment or machinery designed and intended for a specific work-related purpose other than
transporting people or property;
B. FL—fleet sale—sales of five or more motor vehicles from the dealer's inventory to the
same buyer within one calendar year;
C. DL dealer sales—sales of vehicles to another Texas dealer or a dealer who is legally
recognized in another state as a motor vehicle dealer;
D. SS subsequent sales—dealer-financed sales of motor vehicles that, at the time of sale,
have dealer financing from the inventory in this same calendar year. The first sale is reported
as a motor vehicle inventory sale,with sale of this same vehicle later in the year classified as
a subsequent sale;
• sales price—is set forth on the application for Title, or would appear if that form was used;
• unit property tax value;
• total unit property tax value for each page and for the total report; and
• total sales—number of vehicles for each type of sale and by total sales amounts.
The chief appraiser may examine the books and records of the dealer by personally delivering a written
request to the custodian of the records at the dealer's location. The request must be delivered at least 15
days prior to the date of the request to view the records and must contain a statement notifying the dealer
that he or she may seek judicial relief from compliance with the request.
File the report and payment by the 1 Oth day of the following month.
Step 6—On behalf of the dealer,the county tax collector pays the annual inventory taxes from the
dealer's escrow account and bills the dealer for any additional amount due.
Receives annual property tax bills,usually in October and November:
• taxing units send a copy of the dealer motor vehicle inventory tax bill to the county tax assessor-
collector;
• dealer pays all other tax bills to the taxing units;
210
• county tax assessor-collector pays the inventory tax bill from the escrow account—usually in
early January after the dealer's December payment—to the taxing units.
Receive tax receipt for payment and any additional tax bill from county tax assessor-collector for any
deficiency in the escrow account:
• dealer must pay the deficiency by January 31 to avoid delinquent penalty and interest;
• if taxes become delinquent,dealer pays each taxing unit,plus penalty and interest;
• taxing units receive any excess taxes that remain in escrow account;
• the dealer may not withdraw funds from the escrow account; and
• the escrow account begins with a zero balance for the next tax year's prepayments.
Penalties
A dealer who does not file the monthly tax statement by the 1 Oth day of the following month commits a
misdemeanor punishable by a fine up to $100 per day until filed. A tax lien can be attached to the dealer's
business personal property to secure payment of the $100 penalty. A dealer forfeits an additional penalty
of$500 for each month or portion of month that it is not filed. Furthermore, a dealer who fails to remit the
taxes due pays a 5 percent late payment,with another 5 percent due if not paid within 10 days.
3.08 Utility, Mineral Property
All personal property of utility companies and coops consisting of electric,telephone,railroad, gas
distribution systems,pipelines, compressors&pump stations,telecommunications, cable TV, and water
utilities are valued by a consulting firm contracted for this specific function. Along with the above,this
firm will also value interests in energy mineral properties—i.e.,oil,gas, lignite,and uranium.
While these values are generated outside the appraisal district,they are monitored for accuracy and
reasonableness, as well as correct allocation to the taxing jurisdictions,by the personal property
supervisor.
It is the district's policy to follow the recent decision of the Texas Supreme Court in regards to assessing
near surface minerals such as sand, gravel, limestone, granite,talc and sulfur; it states that those minerals
not mined or stockpiled, or part of a mine or quarry, are not taxable.
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Wardlaw Appraisal Group, L.C.
Mineral, Utility, Industrial, & Personal Property
2018 Mass Appraisal Report
INTRODUCTION
Appraisal Responsibility
Wardlaw Appraisal Group, L.C. (WAG)is a contract mass appraisal firm responsible for
developing fair and uniform market values on certain complex properties for client appraisal
districts in Texas. The complex properties we appraise include mineral, utility, industrial,and
personal properties. The client appraisal districts use these property appraisals as part of the
appraisal roll for each of the taxing jurisdictions. WAG is under contract to support ten(10)
Texas appraisal districts in 2018. Those appraisal districts are Brooks, Childress, Denton, El
Paso, Kenedy, Kleberg, Runnels, Starr,Webb, and Zapata.
Each contract between WAG and our client appraisal districts specifies our appraisal
responsibilities in support of that district. Generally, those responsibilities are to discover,
inspect,appraise,and maintain ownership records of the specific properties that are the
subject of the contract. The properties covered under our contracts generally fall under the
Texas Property Tax Code Categories G(minerals), J (utility), F1 (commercial real), F2
(industrial real), L1 (commercial personal)and L2 (industrial personal). The appraisal districts
contract with WAG to provide these services because the districts do not have the personnel
or resources to perform the appraisal internally.
Appraisal Resources
• Personnel—WAG maintains a professional employee and consulting staff that
is skilled and experienced in property tax appraisal, engineering, information
technology, administration, and division order maintenance. The appraisal staff
consists of six(6) registered appraisers, all of whom are Registered
Professional Appraisers (RPA), and two (2)of who are Registered Professional
Engineers in Texas. These appraisal personnel are listed in Attachment'A'. All
appraisers maintain a current registration in good standing with TDLR. Our
appraisers improve and supplement their mass appraisal skills by participating
in continuing education classes and by attending property tax related
conferences.
• Data—The appraisers inspect their assigned properties, if appropriate, to
obtain information about buildings, site improvements, process and shop
equipment, and various items of personal property. In addition, appraisal
personnel use information provided by property owners concerning the cost to
purchase, install, and construct items of real and personal property. For
mineral interests, data is collected from regulatory agencies such as the Texas
Railroad Commission and the Texas Comptroller of Public Accounts, as well as
from published data sources and fee-for-service companies.
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VALUATION APPROACH (MODEL SPECIFICATIONS)
MINERAL APPRAISAL
Discounted Cash Flow analysis is the Income Method of Appraisal(Section 23.012 of the
Texas Property Tax Code)used as the most appropriate technique for determining the market
value of mineral properties. It is the primary appraisal method used for mineral properties.
The Market Data Comparison Method of Appraisal (Section 23.013)and the Cost Method of
Appraisal(Section 23.011)are also used. In addition, petroleum industry tendencies for
acquisition and replacement cost(usually in dollars per barrel of oil equivalent)are
considered. Because the sales and purchase prices of oil and gas properties are not
generally disclosed,the Market Data Comparison method can seldom be used.
WAG uses discounted cash flow analysis to appraise every producing lease in the appraisal
districts we support. The appraised value of each lease is distributed to each working interest,
royalty, and overriding royalty interest owner based upon their decimal interest in the lease.
The oil and gas lease market values are reviewed and tested to ensure reasonableness and
consistency. The reviews and testing include comparative analysis of the value, production,
decline and price change from the previous year's appraisal. Additionally,comparative rules
of thumb are reviewed to determine if the market value is in the correct range. The most
common of these rules of thumb is that the appraised value of a mineral interest is often within
24-60 months revenue.
Additionally,the Property Tax Division of the Texas Comptroller of Public Accounts performs a
Property Value Study each year,which effectively provides testing,and a comparative review
of the mineral appraisals on a statistical sample of the leases in many of our counties.
UTILITY, INDUSTRIAL AND PERSONAL PROPERTY APPRAISAL
Area Analysis
The scope of market forces affecting industrial products and the capital goods used in the
production process tends to extend beyond regional considerations. The effects of
information and transportation technology are such that many industrial market forces are
measured globally. One exception to this general concept is the market for industrial land.
The pricing of land tends to be closely tied to possible alternative uses in the area. For this
reason, the CAD appraisers assigned to land valuation analyze market forces for specific
areas and adjust land value schedules appropriately.
Area Analysis
Neighborhood analysis of the type of properties valued by the industrial appraiser is not
meaningful. Industrial properties do not have the type of generic"sameness"that is
appropriate for neighborhood models.
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Highest and Best Use Analysis
The highest and best use of real or personal property is the most reasonable and probable
use of the property on the date of appraisal that is physically and financially feasible, legal,
and that derives maximum production from the property. Usually,the current use of the
property is the highest and best use of that property. Industrial facilities are most commonly
located in areas that support industrial use. In areas where mixed used does occur,the
highest and best use of the property is examined by the appraiser to estimate the effect of this
factor.
Market Analysis
Market analysis is the basis for finalizing value estimates on properties for which the utility,
industrial and personal property appraiser has responsibility. Even though many utility and
industrial properties are unique in nature, the market for this type property is analyzed to
determine how the values of similar properties,or properties that are as similar as possible,
are affected by market forces. Some industrial properties, such as machine shops. have
many facilities that can be compared to similar subject properties in terms of type and size of
equipment, type of property fabricated or services at the subject facility,and other factors.
Those similarities help the appraiser estimate the value of the subject property.
Cost Analysis
The Cost Approach to value is applied to most personal property. This approach is utilized in
conjunction with the Market and Income approaches to arrive at a final market value for most
utility companies and many industrial companies. For the Cost Approach,depreciation
schedules are developed based on the percent good typical for each property type at any
specific age. Depreciation schedules have been implemented for what is typical of each
major class of property by economic life categories. Schedules have been developed for
improvements with varying years of expected life. The actual age, if known,and the effective
ages of improvements are noted. Effective age estimates are based on the utility of the
improvements relative to where the improvement lies on the scale of its total economic life and
its competitive position in the marketplace.
Market adjustment factors such as external and/or functional obsolescence can be applied
when warranted. A depreciation calculation override can be used if the condition or effective
age of a property varies from the norm by appropriately noting the physical condition and
functional utility ratings on the property data characteristics. These adjustments are typically
applied to a specific property type or location and can be developed via ratio studies or other
market analyses.
Many utility, industrial and personal properties use the same types of buildings and,
depending on the type of business, may use the same types of manufacturing or service
equipment. Many of the buildings encountered at industrial facilities are generic in
construction,such as pre-engineered metal buildings. The cost per square foot to construct
these type structures can be used to estimate values at facilities that have similarly
constructed buildings. However,the building as constructed will have differences that must be
taken into account when estimating the final value of the property being reviewed. The
majority of these typical type buildings are appraised by CAD personnel.
However,some industrial properties, such as specialty chemical plants,are so unique in
nature that the appraiser must use additional information such as output quantity, type of
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product manufactured,and other factors to estimate the value of the subject property.
However,the manner in which the entire business operation is put together may make a
particular facility unique. The district uses information from similar businesses to examine the
real property values at a particular business, but the individual characteristics of the business
being reviewed determine the value estimation. Some industrial buildings are use specific
and therefore have no comparable properties.
A similar analysis is used for personal property. Many items of personal property, such as
furniture and fixtures,computers,and even machinery and equipment are generic in
construction, but individual characteristics that affect value,such as usage,environment
where used,and level of care will have an effect on the final value estimations. When cost
data for this type of property is available and considered reliable, it is used for value
estimation purposes at other plant facilities. However,on-site inspection and information
provided by the property owner will affect the final value.
Income Analysis
Capitalization analysis is used in the income approach models.This methodology involves the
capitalization of net operating income as an indication of market value for a specific property.
Capitalization rates, both overall cap rates for the direct capitalization method and terminal
cap rates for discounted cash flow analyses,can be derived from the market. Sales of
improved properties from which actual income and expense data are obtained provide a very
good indication of what a specific market participant is requiring from an investment at a
specific point in time. In addition,overall capitalization rates can be derived from the built-up
method(band-of-investment).This method relates to satisfying the market return
requirements of both the debt and equity positions of a type of company.
Many utility companies are appraised on a Unit Appraisal Model,which utilizes both the
income and cost approaches to value. Information from publically available sources such as
FERC and RRC reports are utilized to arrive at the input parameters for these types of
properties.
DATA COLLECTIONIVALIDATION
Data Collection
An extended range of variations may exist within the same class of utility, industrial or
personal property,and there are a multitude of property types within the industrial category.
For this reason,effective data collection procedures would be very difficult to organize in a
single comprehensive manual. WAG uses many different publications available to the
industry,such as the Oilfield Appraiser and the Equipment Newsletter, and other companion
data acquisition forms to standardize data collection for schedule building that are later
assigned to the industrial appraisal staff. The data generated by these forms enables the
appraiser to use the software to value industrial properties.
Industrial personal property also consists of many different classes of assets with a wide
range of variation within each class. The district has adopted the convention of listing assets
and estimating effective age of assets in the field. The field listing is then compared with
information furnished by the property owners during the final valuation review.
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Sources of Data
The original real and personal property data used by WAG on behalf of the CADS have been
maintained on the CAD computer system. The district and contract appraisal personnel have
updated that information based on field review, renditions.and personal contact information.
For Commercial vehicles,an outside vendor,Just Texas, provides the appraisers with a listing
of vehicles registered commercially in the County. The vendor develops this listing from the
Texas Department of Transportation Title and Registration Division records. As new facilities
are built,the appraisal personnel collect all the real and personal property data necessary to
value the property initially and thereafter update the information when the property is again
visited. Other sources of data include publications such as the Texas Register regarding
waste control permits, various refining and chemical industry magazine articles,and Texas
Industrial Expansion articles on new construction.
Data Collection Procedures
The district and contract appraisal personnel annually or periodically visit assigned plants and
facilities. The frequency of the visit is determined by the nature of the business conducted at
each facility. For example, refineries and chemical plants are continually changing or adding
to processes to extract greater efficiencies or make new products, but machines shops may
not add or remove equipment over a period of two or more years.
The appraisers take with them the past data on the building and site improvements and the
prior listing of personal property at the facility being visited. Changes to the existing structures
and personal property are noted and that information is used for value estimation purposes. .
In addition, if possible, pictures are taken at the time of inspection to validate information
provided on the rendition or to utilize for the appraisal if no rendition is submitted. If cost
information for the real or personal property is supplied later,the field data can be compared
to that information to judge the accuracy of the information.
The WAG appraisal staff members are not assigned any one geographical area of the county.
The category of property,the nature of the business, and whether or not the district has the
staff resources available can each be a determining factor in identifying which properties are
appraised by WAG and which properties are appraised by the district's appraisal staff. WAG
appraisers are trained by accompanying appraisers who have performed field visit and
appraisal functions for a number of years. In additions each WAG appraiser is registered with
the Texas Department of Licensing and Regulation and is either a RPA or is working towards
the RPA designation. Each WAG appraiser is responsible for the completeness and
correctness of their valuation work, but a new appraiser is encouraged to seek the advice of
and review by experienced appraisal staff.
VALUATION ANALYSIS (MODEL CALIBRATION)
Final Valuation Schedules
WAG develops schedules based on indexed Marshall&Swift depreciation factors, as well as
the schedules prepared by other appraisal districts,state appraisers and other cost estimates
for use in the valuation of all business and industrial personal property. In addition,appraisal
personnel, utilize actual cost data developed from both publicly available sources as well as
proprietary information received from other companies without identifying information,to
update these schedules annually.
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INDIVIDUAL VALUE REVIEW PROCEDURES
Field Review
WAG personnel periodically review their assigned real and personal property accounts. These
accounts are physically inspected on a one to two-year cycle. Certain properties are reviewed
annually because past experience shows that changes are occurring continually in the real or
personal property at that facility.
The results of prior year hearings, renditions,and indications of new activity are another
source that initiates required field visits. Many times during hearings, issues are presented
that cause a value adjustment. Those issues must be field checked to see if these influences
will be on-going and warrant permanent value adjustments or are transitory.The information
will be recorded so the appraiser will be better able to estimate the property value. Any new
construction or business activity is noted and the information necessary to value the property
is recorded.
Part of the field review includes noting any land characteristics that would affect the land
value. The district values all land for the properties over which it has responsibility, including
those properties assigned to WAG.WAG advises the district of any characteristics that would
affect the value of the land associated with an assigned facility.
Office Review
All properties are reviewed in the office by the WAG appraiser assigned to each particular
utility, industrial, or personal property. The office review relies on historical information in the
utility, industrial, or personal property file as the basis for deciding on the estimated value to
be placed on the property for the current tax year.
The date of last inspection,extent of that inspection,and the appraiser responsible are listed
in the WAG system. If a property owner disputes the district's records concerning this data in a
protest hearing,the property record may be altered based on the credibility of the evidence
provided.
When valuing utility, industrial or personal property,the type of furniture, equipment,
computers, etc.,will be used along with any cost data provided by the property owner to
estimate the value. Experience in valuing similar property at other facilities will help the
appraiser estimate the value of the subject facility. Individual characteristics of the property,
such as usage and maintenance will have a bearing on the value calculated by use of the
WAG schedules.
PERFORMANCE TESTS
Sales Ratio Studies
Ratio studies are an important tool to examine how close appraised values are to market
values. The ratio study may use available sales data or independent,expert appraisals.
Typically, there are not enough sales of utility and industrial properties to show
representativeness of that class of property in a ratio study. Ratio studies of utility and
industrial properties normally rely on independent appraisals as an indicator of market values.
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Comparative Appraisal Analysis
This type of analysis is not normally performed on industrial property due to the unique nature
of the property. Time and budget constraints regarding available appraisal staff also plays a
role in the type of analysis that occurs. Only in an instance where a jurisdiction would file a
jurisdiction challenge with the Appraisal Review Board would the district perform such an
analysis.
If a CAD receives a jurisdiction challenge on a utility or industrial property category,the
appraisers assigned to those accounts will research the appraisal roll to see what other similar
properties exist. The real commercial property values can be compared on an average value
per square foot of structure basis, but the location and type of improvement must be carefully
accounted for in the valuation differences between two properties with the same square
footage. Differences in location and type of improvement often account for a greater
difference in market value than simple square footage. In like manner,the personal property
values can be compared per category, such as furniture and fixtures, machinery and
equipment,etc., but a comparison of the type and use of the property must be examined to
ensure property value uniformity.
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Attachment A
Wardlaw Appraisal Group Registered Personnel
PROPERTY TAX APPRAISER CERTIFICATION AL
TDLR# NAME TYPE
74200 CRAW,MALLORY M. APPRAISER,RPA
73616 MCFARLANE,KATHLEEN M. APPRAISER,RPA
74717 SHERWIN,PROCTOR APPRAISER,RPA
66026 WARDLAW,MARGARET A. APPRAISER,RPA
70182 WILLIAMS,CHARLES R. APPRAISER,RPA
71700 WILLIAMS, HAZIEL M. APPRAISER,RPA
PROFESSIONAL ENGINEERING CERTIFICATION
PE# NAME IBRANCH
76914 WARDLAW,MARGARET PEGGY ANNE PETROLEUM
77254 WILLAMS,CHARLES RAY JR "rt
PROFESSIONAL ENGINEERING FIRM CERTIFICATION
FIRM# FIRM NAME
15194 WARDLAW APPRAISAL GROUP LC
8
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i
WARDLAW WARDLAW APPRAISAL GROUP
2018 CAD CERTIFIED VALUES
PROPERTY CLASSIFICATION
Gl&G2(MINERAL) ILL&L2(PEso") 1(URM) F2&Fl(INDUSTRIAL REAL) CADTOTAL
CAD ACCOUNTS VALUE ACCOUNTS VALUE ACCOUNTS VALUE ACCOUNTS VALUE ACCOUNTS VALUE
BROOKS 7,912 $158,679,190 105 $13,611,780 168 $168,323,980 3 $590,420 8,188 $341,205,270
CHILDRESS 39 $325,1 19 $10,895,370 79 $206,231,170 0 SO 137 $217,451,680
DENTON 146,946 $916,544,3 351 $246,520,280 2,071 $1,288,776,340 0 SO 149,368 $2,451,840,980
EL PASO 0 $ 310 $1,969,095,060 321 $751,840,300 9 $858,642,040 640 $3,579,577,400
KENEDY 4,958 $111,456,97 80 $542,598,170 107 $208,21$400 2 $654,550 5,147 $862,928,090
KLEBERG 4,915 $54,354, 75 $52,873,840 294 $231,903,570 0 50 5,284 $339,031,470
RUNNELS 5,846 $27,126, 324 $75,003,610 200 $130,T77,450 56 $11,389,450 6,426 $244,296,950
STARR 30,453 $321,6, 211 $22,703,720 387 $355,949,880 11 $739,919,52C 31,062 $1,440,253,890
WfBB 59,928 $5,292,656,43 285 $494,686,590 311 $1,831,482,100 0 50 60,524 $7,618,825,120
ZAPATA 47,376 $421,553,180 163 555,816,940 192 5169,225,200 0 5L 47.731 $646,595,220
TOTALS 1 308,373 $ 6,882,823,360 1,923 $ 3,483,805,260 1 4,130 $ 5,342,628,290 81 $ 1,611,195,980 314,507 5 17,742,006,070
220
=
WARDLAW
11%r
APPRAISAL
CERTIFICATION
I certify that, to the best of my knowledge and belief
The statements of fact contained in this report are true and correct
The reported analyses, opinions, and conclusions are limited only by the
reported assumptions and limiting conditions, and the personal, impartial and
unbiased professional analysis, opinions and conclusions of either myself or of
the other appraisers who support and appraise property for our client CDs.
I have no present or prospective interest in the property that is the subject of
this report. and I have no personal interest with respect to the parties involved.
1 have no bias with respect to any property that is the subject of this report or
to the parties involve with this assignment.
• My engagement in this assignment was not contingent upon developing or
reporting predetermined results.
My compensation for completing this assignment is not contingent upon the
reporting of a predetermined value or direction in value that favors the cause
of the client, the amoun of the value opinion, the attainment of a stipulated
result, or the occurrence of a subsequent event directly related to the intended
use of this appraisal
• My analyses, opinion, and conclusions were developed. and this report has
been prepared in conformity with the Uniform Standards of Professional
Appraisal Practice.
• We have made personal inspections of many but not all properties that are the
subject of this report.
• No one outside of Wardlaw Appraisal Group provided significant mass
appraisal assistance to Wardlaw Appraisal Group personnel
Charles R i s, E PA Date
President
WARDLAW APPRAISAL GROUP, L.C.
16601 Blanco Rd,Ste 100 s San Antonio,TX 78232 s 210.448.2000 i 210.408.0106 fax
221
WARDLAW APPRAISAL GROUP
CLIENT APPRAISAL DISTRICT
Reappraisal Plan 2019 - 2020
Contract Valuation Support
Appraisal Responsibility
Wardlaw Appraisal Group,LC(Wardlaw)provides complex property appraisal support services
for client County and Central Appraisal Districts(CAD). Client CADs contract with Wardlaw
because we have specialized expertise which the CADs may not have in appraising these
complex properties. The complex properties Wardlaw appraises are generally referred to as
mineral, utility.industrial,commercial and real properties and fall under the Texas Property Tax
Classification Categories F,G,J,and L.
The specific contract between Wardlaw and each client CAD specifies appraisal responsibilities.
Generally.those responsibilities include discovering. inspecting. appraising. maintaining and
providing ownership and valuation records for the specific properties that are the subject of the
contract. The contracts establish that Wardlaw acts as an agent of the CAD to provide many of
the appraisal and support services required under the Texas Property Tax Code and the
Uniform Standard of Professional Appraisal Practices(USPAP).This document details the
reappraisal practices that Wardlaw performs on behalf of CADs and is intended to be
incorporated by CADs into their own Reappraisal Plan.
Appraisal Calendar
Wardlaw adheres to the property tax calendar as established by the State of Texas Property
Tax Code.The Wardlaw appraisal calendar generally follows this schedule:
November—June: Field Inspections of Properties
January 1: Beginning of the Tax Year
Prior to January 31: Rendition Request Letters mailed
January 31: Last day for receipt of 25.25 protests from prior year
April 161,15"or 30': Renditions due(dates dependent on County and property type)
Around May 1: Mail Notices of Appraised Value
May 1: Begin Equalization Process. Work with property owners to explain
appraisals and work on formal and informal protests
Around June 1: Mail Notices of Appraised Value for properties with an Extension
Late June—Early July: ARB Hearings
Mid-July: Deliver totals and Certified Rolls to CADS
August—November: Process Property Supplements.Additions&Deletions
November: Begin Field Appraisals for coming Tax Year
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Equalization Period
Preliminary values established by the 25.19 Notices of Appraised Value are subject to change
during the equalization period.These changes can be initiated by property owner formal or
informal protests. The changes can also be initiated by Wardlaw if new information regarding a
property becomes available. Formal and informal protests on the mineral,utility, industrial.
commercial and real properties are handled directly by Wardlaw.within the appropriate
timetables established by the Property Tax Code.Wardlaw attempts to contact protesting
taxpayers so that we can;
1)Provide the taxpayer an opportunity to explain the reason for their protest.
2)Explain the appraisal methodology and appraisal parameters used on each
protested property,
3) Consider whether the preliminary appraisal should be adjusted considering
taxpayer evidence,
4)Provide settlement and withdrawal paperwork to the taxpayer if appropriate.
Wardlaw directly responds to taxpayer requests for appraisal information and supporting
appraisal documentation by providing the requested information in a timely manner. Wardlaw
then goes on to represent the CAD before the Appraisal Review Board(ARB)to justify
appraised values for all protested properties that fall under the mineral. utility, industrial,
commercial and real contract.
Documentary evidence of formal and informal changes is then provided to the CAD and ARB in
the form of Withdrawal of Protest Settlement waivers on formally protested accounts. The final
values are then delivered for certification.
Minerals (Oil and Gas Reserves) Valuation Process
Appraisal Responsibility
Minerals-in-place (oil and gas reserves) are real property classified as Category G property
under the Texas Property Tax Code. As a commodity, minerals-in-place are part of a national
market so there is no local market area to consider. Wardlaw performs an appraisal as of
January 1 each year on every producing mineral property in the CAD to determine the market
value of the oil and gas mineral reserves for ad valorem tax purposes.
DCF analysis is the primary method used for appraising mineral properties. The Market Data
Comparison Method of Appraisal (Section 23.013) and the Cost Method of Appraisal (Section
23.011) can be used when appropriate and when the necessary data is available. However.
because the sales and purchase prices of oil and gas properties are not generally disclosed, the
Market Data Comparison method is seldom used, and the Cost Method of Appraisal does not
estimate the market value as defined in Section 1.04 of the Texas Property Tax Code.
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Discounted Cash Flow(DCF)analysis is the Income Method of Appraisal (Section 23.012 of the
Texas Property Tax Code) and is used as the most appropriate technique for determining the
market value of mineral properties. WAG uses DCF analysis to appraise every producing lease
in the appraisal districts we support. The appraised value of each lease is distributed to each
working interest, royalty interest, and overriding royalty interest owner based upon their decimal
interest in the lease.
Mineral interests are commonly divided into property ownership interests known as working
interests,overriding interest,and royalty interests. The valuation of each type of interest begins
with the valuation of the producing well on the mineral lease.That value is then allocated to the
property ownership interests based on the decimal ownership value identified in the division
orders for each lease. It is the goal and purpose of the CAD to identify every producing mineral
property within the district and estimate the market value of each property listed on the roll.
Appraisal Resources
Personnel—Wardlaw provides adequate personnel to meet all contract appraisal requirements.
Data-A common set of production data for each mineral property account in each CAD is
collected from the Texas Railroad Commission Records and data entered to the appraisal firm's
computer. The property characteristic data is gleaned from the production data and drives the
computer-assisted mineral property appraisal system. Railroad Commission records are
searched to discover new leases as of January 1 of each year and descriptive information is
gathered to determine the location of the lease within the CAD jurisdictional boundaries.
Records are also reviewed for changes in production for existing wells,for abandoned wells,
and for non-producing wells with salvage value for the equipment,tanks, and tubular goods.
Production history for each mineral lease is gathered from HPDI. Drilling Info, Petroleum
Information,and from the Texas Railroad Commission. Division Orders on each lease are
requested annually from lease operators and checked against the existing division orders for
changes as well as for accuracy of owner name. address, and ownership percentage interest.
To help determine operating expense information on each active lease, lease-specific operating
expenses are requested annually.A Confidential Lease Operating Expense Detail request
letter is e-mailed or mailed,to the operators or agents representing operators requesting lease-
specific operating expenses.
To assist with the economic parameters influencing these properties.general economic
data is gathered for the valuation process. The method of appraisal for minerals-in-
place is the discounted cash flow analysis which looks at the net present value of the
future income that is derived from operating the lease. Current interest rates, market
rates of return and levels of discounting the investment are factors to consider when
evaluating the returns necessary to attract investment capital for this type property. The
annual capitalization rates are calculated using the"Manual for Discounting Oil and Gas
Income"as developed by the Texas Comptroller's Office. Data is obtained from
Ibbotson's SBBI Valuation Edition,Wall Street Journal, Standard& Poor's Bond Guide,
and Value Line Investment Survey"Ratings and Reports".
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VALUATION AND STATISTICAL ANALYSIS (model calibration)
Pt-icing, Operating Expenses find Reserve Analysis
Crude oil and natural gas prices are required information in the valuation of mineral property
because these prices are necessary to determine income to the lease and the economic life of
the production from the lease. The crude oil sales price and natural gas sales price used for
the first year of the appraisal analysis is based on the previous year's average price multiplied
by the Price Adjustment Factor(PAF). The prices are then escalated or de-escalated for five(5)
years according to the Texas Property Tax Code Sec.23.175 Section(a). Lease operating
expenses are estimated based on rendered information,actual operating cost and expenses,
and from surveys of lease operators in the CAD. The January 1 production starting rate is
based on the actual production rate or upon a projection of past average production. The past
oil and gas production history of the lease is analyzed to estimate the future rate of production
decline of the lease. Other considerations include past lease expenses and recent operating
parameters such as water production, workover operations,and secondary recovery efforts.
Current operating income and expenses for the lease are calculated in a discounted cash flow
model used by the appraiser to evaluate and estimate the net present value of producing oil and
gas income from the lease. Discount rates established for each lease based upon the particular
risks inherent with production of oil and gas from that property. The discounted cash flow model
allows the appraiser to establish current market value of the lease based on the discounted
value of the future estimated recoverable reserves. This methodology is approved and
recommended by the Property Tax Division of the Comptroller's Office and is a recognized
method of appraisal by industry standards. The appraisal firm has utilized the discounted cash
flow model to estimate the market value of each lease located in each CAD.
Value Review Procedures
The method of value review for this type of property is based on the review of the factors
estimated within the discounted cash flow analysis methodology such as the discount rate,
product prices,and operating expenses. Evaluation and verification of these economic factors
as to their validity within current economic times and based on current capital requirements for
investment in this type property is re-confirmed and reviewed for reasonableness. Sales of
mineral properties are considered but adequate sale data is usually not available due to
difficulty in confirming sales. The market for this type of property is neither an active nor an
efficient market,there are very few participants and pricing information is mostly confidential.
There is no source for tracking these transactions and property owners are reluctant to reveal
market information concerning prices paid or terms of the transaction. Because of a lack of
market sales on mineral property, appraised values are regularly compared to similar properties
within the same production field,field of exploration, strata of formation. or production history
and expense level.
Ratio studies are a source of comparison to evaluation level and uniformity of appraisal. When
market sales are available the ratio study is based on a comparison of the appraised value to
the sale price. For mineral property,which lacks available market sales.a ratio study is a
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comparison of another appraisal opinion with the opinion of the district to determine level and
uniformity of appraisal. The Property Tax Assistance Division of the Comptroller's Office
conducts biennial ratio studies of selected mineral properties to gauge the districts appraisal
performance. The PTAD utilizes the same valuation methodology as the CAD to appraise
individual mineral properties. This opinion of value is then utilized as market evidence with the
same significance as if the property sold for that value. The estimated value of the property in
each CAD is compared to the appraisal by the PTAD to calculate the ratio and the indicated
level of appraisal_ This study indicates the median and mean levels of appraisal for mineral
property and is considered reliable as a review and evaluation tool.
Utility, Industrial & Commercial Property Valuation Process
Appraisal Responsibility
Utility. Industrial and Commercial properties are the tangible assets of various businesses
including electric production, transmission,and distribution companies,railroads, petroleum
product gathering and delivery pipelines, telephone and communication providers and others.
Utility properties are identified in the Texas Property Tax Code as Category J property.
Industrial properties are identified under the Texas Property Tax Codes as categories L2
(Industrial, Personal), F2(Industrial, Real)and L1 (Commercial).The valuation of these
properties is considered to be complex due to the involvement of both tangible and intangible
property elements that comprise these businesses and due to the size of some of the utilities
that are regional and national companies. The appraisal of these companies becomes complex
when considering the valuation of the property as a unit in place,evaluating the property by the
approaches to value at the company level. The appraisal district does not have personnel
qualified to perform this type of appraisal.An appraisal firm is employed to provide the expertise
to perform this type of appraisal.Once the estimated value of the unit is determined by the
appraisal firm. that estimated market value is allocated based on the tangible property assets
that are located within each CAD.
Appraisal Resources
Personnel—Wardlaw provides adequate personnel to meet all contract appraisal requirements.
Data-A common set of data characteristics for each utility, industrial and commercial property
account in each CAD is collected from the various government regulatory agency records. field
inspections,data resources, and property owner renditions. This data is entered to the
appraisal firm's computer. Individual company financial information is gathered through industry
specific governmental filings such as Federal Energy Regulatory Commission Reports,
Securities and Exchange Commission 10-k filings. Railroad Commission and Public Utility
Commission publications. Other company information is gathered from annual reports, internal
appraisals.and other in-house and industry publications. Property owner renditions are
requested in order to document and list property owned and located in our particular
jurisdictions lie: track mileage,number of meters,pipeline size and mileage,substation and
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Reappraisal Plan 2019-2020
Wardlaw Client Appraisal Districts
Page 6
transmission capacity,etc.). The property characteristic data drives the computer-assisted
appraisal of the property.
The appraisal of utility and industrial property utilizes three-approach analysis to form an opinion
of value for the property. Financial and capital market information is pertinent to understanding
factors affecting valuation of complex property. It is necessary to gather financial data to
attempt understanding investor and corporate attitudes for capital return expectations and to
give consideration to return components such as current interest rates,capital debt structure,
bond market rates,and capital supply and demand trends. These financial factors result in
overall return rates and capital structure for these companies and affects capitalization rates.
The weighted average cost of capital is the most commonly used method of estimating
capitalization rates for utility properties. Capitalization rates are estimated using capital return
expectations from various publications: Duff&Phelps Valuation Handbook,Wall Street Journal.
Mergent Bond Record, Moody's Corporate Bond Yield Averages, Standard&Poor's Capital 10.
Industry specific information is also gathered from web sites,publications, periodicals. and
reference manuals. Wardlaw then estimates the capitalization rate for utility appraisal under the
income approach.
VALUATION AND STATISTICAL ANALYSIS (model calibration)
Approaches to Valuation, Reconciliation
Valuation of tangible assets for utility and industrial companies relies primarily on indications of
value based on the cost and income approaches to value under the unit value approach. This
methodology involves developing and estimating market value considering the entirety of the
company's tangible assets and resolving an allocated value for that portion of specific tangible
assets located in particular tax jurisdictions. The valuation opinion is based on three approach
analysis utilized for the indicated unit appraisal of all company tangible assets,then an
estimated allocation of unit value for only assets located in the district and particular
jurisdictions. This methodology is approved and recommended by the Property Tax Assistance
Division of the Comptroller's Office and is an accepted standard within the industry and
appraisal community.
Value Review Procedures
Review of the valuation of utility property is based on verifying economic and financial factors
utilized in the methodology as relevant to current capital markets and that these factors reflect
current return expectations. Market sales of utility properties do occur and are a good source
for comparison and review when the price of the tangible assets can be abstracted or allocated
from the selling price. Typically, the sale of utility companies involve significant intangible
property assets such as customer base,goodwill,favorable contracts,name recognition,etc.
and the contributory value and allocation of these assets is subjective and unknown. In Texas.
intangible property assets are exempt from taxation and must not be included on the appraisal
roll as taxable property. Therefore, because of the lack of specific market information on sales
of utility properties. appraised value is regularly compared to the valuation of similar property
within the same set of property characteristics, business type and size. More of comparison for
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Reappraisal Plan 2019-2020
Wardlaw Client Appraisal Districts
Page 7
equity concerns on valuation rather than the full recognition of a market level certainty about
appraisal level. Of course,the estimated value is based on recognized methodology for
considering the valuation of these tangible assets, but true market confirmation of these factors
may not be possible due to minimal market knowledge and experience.
Ratio studies are also a method of review for relevance of appraisal valuation to market value.
Again, in the absence of full disclosure of prices paid and without the abstraction of prices paid
for the tangible asset components from recent utility property acquisitions or sales. market
based analysis and review is not possible. Ratio studies for utility property must rely on a
comparison of one appraisal opinion as the basis for the reasonable property valuation with the
district's appraised value to determine the ratio for level and uniformity of appraisal. The PTAD
conducts the annual ratio study of selected utility properties to gauge the appraisal district's
performance. The PTAD utilizes the same valuation methodology to estimate appraisal
valuations of utility properties and the results,when compared to the appraisal valuation
estimated by the appraisal firm for these properties yield ratios. This ratio study of certain utility
properties indicates the level and uniformity of appraisal for this category of property.
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Reappraisal Plan 2019-2020
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STAFF PROVIDING SIGNIFICANT
MASS APPRAISAL ASSISTANCE
PROPERTY TAX APPRAISER CERTIFICATION
TDLR# NAME TYPE
74200 GRAIN,MALLORY M. APPRAISER,RPA
73616 MCFARLANE,KATHLEEN M. APPRAISER,RPA
74717 SHERWIN,PROCTOR APPRAISER,RPA
66026 WARDLAW,PEGGY A. APPRAISER,RPA
70182 WILLIAMS,CHARLES R. APPRAISER, RPA
71700 WILLIAMS.HAZIEL M. APPRAISER,RPA
PROFESSIONAL ENGINEERING CERTIFICATION
PE# MANE BRANCH
76914 WARDLAW,PEGGY A. IPETROLEUM
77254 WILLAMS,CHARLES R. PETROLEUM
PROFESSIONAL ENGINEERING FIRM CERTIFICATION
ARM# FIRM NAME
5194 WARDLAW APPRAISAL GROUP LC
229
3.09 Valuation Bibliography
Reference materials are used by the appraisal district to value or to verify rendered values for specific
items, such as automobiles,trucks, aircraft,heavy construction equipment, etc. Sources include,but are
not limited to,the following publications:
DEPT#203—PERSONAL PROPERTY
(1) VEHICLE REGISTRATION LIST
(2) AIS—NEW CAR COST GUIDE
(3) NADA—USED CAR GUIDE
(4) NADA—OLDER USED CAR GUIDE
(5) NADA—COMMERCIAL TRUCK GUIDE
(6) NATIONAL MARKET REPORT TRUCK BLUE BOOK
(7) NATIONAL MARKET REPORT OLDER TRUCK BLUE BOOK
(8) INSURED AIRCRAFT TITLE LIST
(9) AIRCRAFT BLUE BOOK PRICE DIGEST
(10) MARSHALL& SWIFT—UPDATE
(11) COLE DIRECTORY—DALLAS
(12) COLE DIRECTORY—FORT WORTH
ACCT#5340—DEED, SALES,AND VALUE INFORMATION
(13) POLK CITY DIRECTORY
(14) ZIP CODE DIRECTORY
(15) NATIONAL MARKET REPORT TRUCK BODY
(16) NATIONAL MARKET REPORT COMM TRAILER BLUE BOOK
(17) COLE DIRECTORY—DENTON
(18) VREF AIRCRAFT VALUE REFERENCE
(19) APPRAISAL OF PERSONAL PROPERTY,VARIOUS TEXTS—PTD
(20) GENERAL APPRAISAL MANUAL—STATE PROPERTY TAX BOARD
An independent test of the appraisal performance of the district is conducted by the State of Texas
Comptroller's Office through the annual property value study. The study determines the degree of
uniformity and the median level of appraisals by the appraisal district within each major caLego of
property. The comptroller publishes a report of the study,which includes in the report the median levels
of appraisal for each major category of property,the coefficient of dispersion around the median level of
appraisal for each category of property, and any other standard statistical measures that the comptroller
considers appropriate.
230
2019 CALENDAR OF EVENTS
January 2019 Appraisal Date (except for properties appraised under Sec 23.12(f))
BPP renditions and exempt property applications mailed
March 2019 Field work for real property to be completed
PTAD ARB Training for new members
Oil &Gas Orientation
PTAD ARB Training for existing members
April 2019 Estimates of taxable value sent to entities(sent weekly until certification)
BPP Rendition deadline (without extension request)
Deadline for appraisers to turn work in for data entry
Process real property appraisal notices
Turn records over to the ARB
Deadline for exemption applications including Ag, Freeport and Pollution
Mail real property appraisal notices
May 2019 Meeting with the City Managers of Denton County
Mineral notices mailed
Meeting with the Superintendents and Denton County Judge
BPP rendition deadline (with extension)
Process BPP appraisal notices
Mail BPP appraisal notices
Protest deadline for real property
June 2019 ARB hearings begin
Protest deadline for BPP
Mineral hearings
July 2019 ARB approves records
Chief Appraiser certifies roll
August 2019 EPTS& EARS reports submitted to PTAD
Field work begins for next appraisal year
September 2019 Appraisal date for Sec 23.12(f) properties
"Actual day is tentative.
231
2020 CALENDAR OF EVENTS
January 2020 Appraisal Date (except for properties appraised under Sec 23.12(f))
BPP renditions and exempt property applications mailed
March 2020 Field work for real property to be completed
PTAD ARB Training for new members
Oil &Gas Orientation
PTAD ARB Training for existing members
April 2020 Estimates of taxable value sent to entities(sent weekly until certification)
BPP Rendition deadline (without extension request)
Deadline for appraisers to turn work in for data entry
Process real property appraisal notices
Turn records over to the ARB
Deadline for exemption applications including Ag, Freeport and Pollution
Mail real property appraisal notices
May 2020 Meeting with the City Managers of Denton County
Mineral notices mailed
Meeting with the Superintendents and Denton County Judge
BPP rendition deadline (with extension)
Process BPP appraisal notices
Mail BPP appraisal notices
Protest deadline for real property
June 2020 ARB hearings begin
Protest deadline for BPP
Mineral hearings
July 2020 ARB approves records
Chief Appraiser certifies roll
August 2020 EPTS& EARS reports submitted to PTAD
Field work begins for next appraisal year
September 2020 Appraisal date for Sec 23.12(f) properties
"Actual day is tentative.
232
Date: September 7, 2018 Report No. 2018-120
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
Overview of Keep Denton Beautiful Funding and information on how other cities fund Keep
America Beautiful local affiliates.
SUMMARY:
The City of Denton has funded Keep Denton Beautiful since its inception in 1987. Keep Denton
Beautiful (KDB) staff were previously housed in Planning and Parks and Recreation. KDB staff
are now a part of the Solid Waste/Recycling budget. The KDB Division was moved to Solid Waste,
is closely aligned with the work of the department. The Fiscal Year 2017-2018 KDB Division
budget is $418,046.
KDB programs such as Great American Cleanup, Redbud Festival, Community Tree Giveaway,
Children's Arbor Day, Yard of the Month, Adopt-A-Spot, and youth and neighborhood grants,
align with strategic goals of the City set forth in its Strategic Plan and other long-term planning
tools such as Simply Sustainable and Denton 2030.
Keep Texas Beautiful reported in 2017 that there were 155 active affiliates across the state.
Statewide, affiliates are generally organized and funded in three different ways:
• A stand-alone nonprofit with no connection (monetary or otherwise) to the municipal
government. These affiliates are smaller and generally operate on a volunteer basis.
• A city department without a nonprofit connection.
• A hybrid organization with a connection to the City, either through direct budget
expenditure and/or staff, and a nonprofit arm.
KDB is a hybrid model, comprised of a City Division as well as a nonprofit agency. Of the 155
affiliates in Texas, eighteen of them operate as a hybrid like KDB,including Keep Allen Beautiful
and Keep Irving Beautiful. The remaining Keep Texas Beautiful affiliates are evenly split between
being a stand-alone 501(c)(3) nonprofit organization and a City-funded operation. Due to the
missions of Keep America Beautiful and Keep Texas Beautiful focusing on beautification, litter
prevention, and recycling,affiliates are typically housed in solid waste, environmental services,or
code enforcement departments.
On September 25 the Denton City Council will be asked to consider adoption of a formal
agreement with the Keep Denton Beautiful to clarify the roles and responsibilities of City staff and
the Keep Denton Beautiful Board of Directors. To-date, the only feedback provided by the Board
of Directors is that they have forwarded the draft agreement to their attorney and will allow him
to respond moving forward.
STAFF CONTACT:
Katherine Barnett
Sustainability
940-349-2802
Date: September 7, 2018 Report No. 2018-121
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
Inclusion of Top 20 Taxpayer representatives on the Economic Development Partnership (EDP)
Board
EXECUTIVE SUMMARY:
Since the formation of the Economic Development Partnership Board by the City Council in
2003, two Board members "will be, or be employed by, a top twenty City of Denton ad valorem
or sales tax payer," and such members must reside or work in Denton. While the board
composition has been expanded over the past 15 years to include more diversity of perspective
and experience, that membership category has remained unchanged due to the unique view these
members bring on locating and expanding large companies in Denton and the particular
workforce needs of the largest local employers, as well as the business background and financial
experience of the individual members themselves.
BACKGROUND:
In 2001, at the direction of Mayor Euline Brock, City staff organized a community symposium
called"Denton Tomorrow" in order to share the City Council's vision for the future of Denton
and its economic development and solicit feedback from residents. A retreat, facilitated by the
consulting firm TIP Strategies then was held to further discuss and refine the ideas and concepts
gathered at the symposium; City Council and City staff, Denton Chamber of Commerce Board
leaders and staff, Denton County, Denton ISD,North Central Texas College, Texas Woman's
University, and University of North Texas all participated in the retreat as stakeholders in local
economic development.
In 2002, those stakeholders began a series of steering committee and task force meetings that
ultimately resulted in a detailed strategic plan for economic development. That plan included the
creation of an economic development partnership board to oversee plan implementation and
ongoing economic development activities by the City and the Chamber.
In 2003, the Council approved the economic development strategic plan and officially created
the Economic Development Partnership Board. The original composition of the EDP Board was
two City Council members, two members of the Denton Chamber of Commerce Board of
Directors, two Top 20 tax payers, and the President of the University of North Texas. These
seven voting members represented stakeholders in Denton's government, business, and higher
education sectors. The City Manager and the President of the Denton Chamber of Commerce
were ex-officio members.
In 2011, due to a new emphasis on recruitment of business to locate or expand at Denton
Enterprise Airport, Council added one member to the EDP Board who has "knowledge or
experience in general aviation-related matters."At the same time, an at-large seat was added for
a"citizen of the City of Denton"who "has specific knowledge, skills, and abilities to assist in all
Date: September 7, 2018 Report No. 2018-121
or any one of the functions and responsibilities of the Economic Development Partnership
Board." This brought the total voting membership of the EDP Board to nine.
In 2014, the Council determined that due to the impact economic development has upon the
Denton Independent School District, it was in the public interest to add the Superintendent of
DISD as an ex-officio member.
In 2015, the Council expressed an interest in diversifying the membership of the EDP Board and
determined it was in the public interest to modify the Board's membership to include
participation of the Denton Black Chamber of Commerce and the Denton Hispanic Chamber of
Commerce. Total Board voting membership was now 11.
In 2016, in recognition of Texas Woman's University's contributions to Denton's economy,
Council determined it was in the public interest to add a seat to the EDP Board for the TWU
Chancellor and President; this brought Board voting membership to 12, where it remains today.
DISCUSSION:
One significant activity of the economic development partnership between the City and the
Chamber is to recruit and expand companies that bring quality jobs for citizens and significant ad
valorem or sales volume to grow the local tax base. These particular efforts often focus on larger
companies, which have unique needs in site selection, workforce, utilities, transportation, etc.
The Top 20 taxpayer members can provide perspective to staff and fellow Board members on all
these issues, because they deal with them in the location, expansion, and operation of their
companies. They also serve as a valuable resource in the vetting of such companies' projects and
the financial information they submit when applying to the City for incentives because they often
have experience with projects of similar size and scale. The expansion of the EDP Board
membership over the years has added new and valuable perspectives of small business owners
and has allowed for more gender and racial inclusion. As a whole, the board membership
makeup allows for a wide range of viewpoints based on diverse experience with business
operations of different sizes and in different sectors.
ATTACHMENT(S):
Ordinance No. 2017-203
STAFF CONTACT:
Caroline Booth
Caroline.Booth(_a,cityofdenton.com
940.349.7751
ORDINANCE NO. 2017-203
AN ORDINANCE REPEALING ORDINANCE NO. 2003-258, AND SUBSEQUENT
AMENDMENTS UNDER ORDINANCE NO. 2011-042, ORDINANCE NO. 2014-009,
ORDINANCE NO. 2015-074, AND ORDINANCE NO. 2016-249, RELATING TO THE
CREATION, APPOINTMENTS, AND DUTIES OF THE ECONOMIC DEVELOPMENT
PARTNERSHIP BOARD (THE"BOARD")AND REPLACING THESE ORDINANCES WITH
THIS ORDINANCE RELATING TO THE CREATION, APPOINTMENTS, AND DUTIES OF
THE ECONOMIC PARTNERSHIP BOARD IN ORDER TO CLARIFY THE
QUALIFICATIONS AND LIMITATIONS OF BOARD MEMBERS; AMENDING THE
DENTON CODE OF ORDINANCES, CHAPTER 2, ARTICLE IX; AND PROVIDING FOR A
REPEALER AND CONFLICT CLAUSE AND AN EFFECTIVE DATE.
WHEREAS, in 2003, the City Council of the City of Denton, Texas, determined that is
was beneficial and in the public interest to establish an Economic Development Partnership Board
to provide economic development policy guidance for the City and adopted Ordinance No. 2003-
258 (the "Ordinance"), which ordinance was codified in the Denton Code of Ordinance, Chapter
2, Article IX; and
WHEREAS, in 2011,the City Council amended the Ordinance by adopting Ordinance No.
2011-042 in order to add two seats to the Board, consisting of an at-large position and a position
for a member with general knowledge of or experience in general aviation,and to expand the duties
of the Board to include branding and marketing for Denton Municipal Airport; and
WHEREAS, in 2014,the City Council amended the Ordinance by adopting Ordinance No.
2014-009in order to add the Superintendent of the Denton Independent School District as an ad
hoc non-voting member of the Board; and
WHEREAS, in 2015,the City Council amended the Ordinance by adopting Ordinance No.
2015-074 in order to add two seats to the Board, one for a representative nominated by the Denton
Black Chamber of Commerce Board of Directors and one for a representative nominated by the
Denton Hispanic Chamber of Commerce Board of Directors; and
WHEREAS, in 2016,the City Council amended the Ordinance by adopting Ordinance No.
2016-249 in order to add one seat to the Board for the Chancellor and President of Texas Woman's
University; and
WHEREAS, in 2017, the City Council determined that it is beneficial and in the public
interest to repeal the Ordinance and subsequent amendments in order to clarify and refine the
Board member qualifications, terms, duties, and responsibilities; NOW THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. Findings.
1
The findings contained in the preamble of this Ordinance are incorporated into the body of
this Ordinance.
SECTION 2. The Code of Ordinances of the City of Denton, Chapter 2, Article IX is
hereby amended by deleting it in its entirety and replacing it with the following:
ARTICLE IX. ECONOMIC DEVELOPMENT PARTNERSHIP BOARD
"Sec. 2-251. Creation, Members, Qualifications, and Tenure.
A. There is hereby created a City of Denton board entitled the Denton Economic
Development Partnership Board (the "Board"). The Board shall consist of twelve members. Six
members shall be appointed for a two-year term in even-numbered years, and six members shall
be appointed for a two-year term in the odd-numbered years. No member shall serve more than
three consecutive terms; members who have served three consecutive terms are eligible for re-
nomination after one year off the Board. The President of the University of North Texas ("UNT")
and the Chancellor of Texas Woman's University ("TWU") or his or her designee may serve
unlimited terms but must be re-nominated upon the expiration of each term.
B. The Board members shall be appointed by the City Council and shall serve at the
City Council's pleasure. To aid the City Council in making appointments to the Board, the City
Council will appoint two City Council members and one Chamber of Commerce ("Chamber")
member to act as a nominating committee ("Committee"). The Committee members are qualified
for appointment to the Board. The Committee will solicit nominations, contact nominees to relate
duties and responsibilities, and to confirm willingness to serve. The Committee will solicit
recommendations from the Chamber Board of Directors, the President of UNT, the President and
Chancellor of TWU,the Denton Black Chamber of Commerce Board of Directors, and the Denton
Hispanic Chamber of Commerce Board of Directors.If any such recommendation is not submitted,
the Committee will consider the racial, ethnic,and gender diversity objectives of the City Council,
as well as the knowledge, skills, and abilities of the nominees to assist in any one or all of the
functions of the Board when making its nomination recommendations to the City Council. After
evaluating the recommended nominees, the Committee will present to the City Council a slate of
Board nominees for City Council approval.
C. Notwithstanding anything contained herein to the contrary, the membership
makeup of the Board shall consist of the following:
1. Two members of the Board shall be City Council members at the time of their
appointment. If such a member is no longer on the City Council, their
appointment to the Board is terminated and their unexpired term shall be filled
by a currently serving City Council member. Such members must be residents
of the City of Denton.
2. Two members of the Board shall be members of the Denton Chamber of
Commerce Board of Directors("Chamber Board"),which are nominated by the
2
Chamber Board, at the time of their appointment. If such a member is no longer
on the Chamber Board, their appointment to the Board is terminated and their
unexpired term shall be filled by a currently serving Chamber Board member.
Such members must reside or work in the City of Denton.
3. Two members will be, or must be currently employed by, a top 20 City of
Denton ad valorem or sales tax payer. Such members must reside or work in
the City of Denton. If such a member is no longer a top 20 City of Denton
taxpayer or employed by one, their appointment to the Board is terminated and
their unexpired term shall be filled by a current City of Denton top 20 taxpayer
or City of Denton top 20 taxpayer employee.
4. One member will be the President of UNT or a UNT faculty or staff member
designated by the President. Such member need not reside in the City of Denton.
5. One member will be the Chancellor and President of TWU or a TWU faculty
or staff member designated by the Chancellor and President. Such member need
not reside in the City of Denton.
6. One member will have knowledge or experience in general aviation-related
matters and shall have no financial interest in matters at the Denton Enterprise
Airport. This member must reside or work in the City of Denton.
7. One member will be a citizen of the City of Denton who, in the discretion of
the City Council, has specific knowledge, skills, and abilities to assist in all or
any one of the functions and responsibilities of the Board.
8. One member will be nominated by the Denton Black Chamber of Commerce
Board of Directors. This member must reside or work in the City of Denton.
9. One member will be nominated by the Denton Hispanic Chamber of
Commerce. This member must reside or work in the City of Denton.
10. The City Manager,the President of the Chamber, and the Superintendent of the
Denton Independent School District will serve as ad hoc ex officio(non-voting)
members of the Board.
D. The Board shall elect its chairperson and vice-chairperson from among its members,
who shall serve for one-year terms or until his or her successor is elected or qualified.
The Board may remove and reelect a chairperson or vice-chairperson at any time with
an affirmative vote of at least 10 members.
3
E. Board members shall serve without compensation. Board members may be allowed
out-of-pocket expenses for activities performed in furtherance of their duties to the
Board. Such expenses must be pre-approved by the City Manager if paid for out of City
funds, or the Chamber President if paid for out of Chamber funds.
Sec. 2-252. Meetings.
The Board shall meet on a regular basis and no less than on a quarterly basis. Monthly
meetings are encouraged. The chairperson, vice-chairperson, or any five Board members may call
any regular or special meeting. Notice of the meetings shall be posted and the meetings shall be
conducted in accordance with the Texas Open Meetings law,being Chapter 551 of the Government
Code, as amended. A majority of the qualified voting members of the Board shall constitute a
quorum for the transaction of business at any meeting of the Board. The act of a majority of the
qualified voting members of the Board present at a meeting at which a quorum is present shall be
the act of the Board.
Sec. 2-253. Rules of Procedure.
The Board shall adopt rules of procedure governing the operation of the Board
incorporating Section 2-29 of City Council Rules of Procedure insofar as it is possible.
Sec. 2-254. Duties and Responsibilities of the Board.
The role of the Board is to provide economic development policy guidance. The Board
may make recommendations to the City Council and Chamber Board of Directors. The Board's
duties include:
A. The Board may create committees or task forces consisting of Board members and/or
non-Board members to assist with the implementation of projects or activities.
Committee or task force chairpersons shall be appointed by the Board and will serve at
the pleasure of the Board.
B. The Board will be responsible for designing economic development incentive policies
and recommending those policies to the City Council for adoption. These policies may
include tax abatement, Chapter 380 agreements, infrastructure assistance, etc. In
making any recommendations, the Board shall comply with applicable law. It will be
the Board's responsibility to review policies of other cities and to be informed as to
legislative changes affecting state and local incentive programs.
C. The Board shall act as the recommending body to the City Council for economic
development incentives authorized by law for specific projects, including without
limitation tax abatements and incentives authorized under Chapter 312 of the Tax Code,
4
economic development agreements authorized under Chapter 380 of the Local
Government Code, public improvement districts authorized under Chapter 372 of the
Local Government Code, and certain Downtown Reinvestment Grants under
Ordinance No. 2012-001. However, utility incentives based on thresholds, such as
Denton Municipal Electric's Economic Growth Rider and the Water/Wastewater Plan
Line Extension may be made without Board review or recommendation. Nothing
herein shall be construed so as to invalidate an economic development incentive
authorized by the City Council that did not receive a recommendation from the Board.
D. The Board will review, consider, and make recommendations to the City Council
regarding marketing and branding for the Denton Enterprise Airport. The Board will
review, consider, and make recommendations to the City Council regarding Denton
Enterprise Airport incentive policies, as assigned by the City Council or requested by
the City Manager,and will act as a recommending body to the City Council for specific
airport economic development incentives, as assigned by City Council or requested by
the City Manager and permitted by City and State law."
SECTION 3. Ordinances 2003-258, 2011-042, 2014-009, 2015-074, and 2016-249 are
hereby repealed and are replaced with this Ordinance provided, however, that the repeal of any
such ordinance or code or part thereof shall not revive any other section or part of any ordinance
or code heretofore repealed or superseded. This ordinance supersedes any provision in any City
ordinance that is in conflict with this ordinance including without limitation any conflicting
provisions of Sections 2-61 through 2-65 of the Code of Ordinances of the City of Denton.
SECTION 4. This ordinance shall become effective immediately upon its passage and
approval.
PASSED AND APPROVED this the day of ..�m, 2017.
CHRIS WATTS, MAYOR
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY: .. .. A' .. ...
APPR( 1 D AS T LEGAL FORM:
AARON EAL, INTERIM CITY ATTORNEY
5
Date: September 7, 2018 Report No. 2018-122
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT: Denton Municipal Electric Base Rate Sensitivity Analysis
EXECUTIVE SUMMARY: The City Council requested information on the cost impact of
lowering Residential base rates and offsetting the resulting revenue decrease with an increase to
Commercial base rates.
BACKGROUND: The electric base rates are set annually with Public Utility Board(PUB)
input and approval by City Council. The base rates are reviewed by staff during the annual
budget process. In addition, a"cost of service" study is completed by an outside entity every
four to five years on the electric rates.
DISCUSSION: Below is a table showing the base rate sensitivity analysis.
If Residential base rates were reduced 1%, this would result in a revenue reduction of$424,000
and would reduce the average Residential customer's bill by about $11.58 annually.
Two options available to offset this revenue reduction are as follows:
1. Commercial base rates (this includes General Service Small and General Service Medium
rate classes) could be increased by 2.4% ($424,000). This results in the average
Commercial customer's bill increasing approximately$23.85 annually.
2. Commercial and Industrial base rates could be increased 1% each, resulting in a total
revenue increase of about $399,000. This would cause Commercial customer's bill to
increase approximately$9.94 annually and an Industrial customer's bill to increase
approximately$6.34 annually.
Electric Base Rate Sensitivity Analysis
Annual Amount
Rate Percentage Amount Per Customer
Base Rate Residential -1.0% $ (424,000) $ (11.58)
Base Rate Commercial 2.4% $ 424,000 $ 23.85
Base Rate Commercial 1.0% $ 177,000 $ 9.94
Base Rate Industrial 1.0% $ 222,000 $ 6.34
Base Rate Comm & Ind 1.0% $ 399,000 $ 16.28
Date: September 7, 2018 Report No. 2018-122
Attached are three graphs that compare the Fiscal Year 16-17 actual MWhs, Meters and
Revenues by Class. These graphs illustrate that DME has a greater proportion of Residential
meters, 88% of all meters, which use 38% of MWhs and provide 43% of Rate Revenue.
Historically, and as confirmed by the preliminary results of the 2018 Cost-of-Service study,
residential electric rates are subsidized by about 10%. This had been a common practice
throughout the electric industry in the past, however, electric utilities are reducing/eliminating
rate subsidies for residential customers from a fairness/equity standpoint and in recognition that
many commercial/industrial customers are electric rate "sensitive".
ATTACHMENT(S):
FY 16-17 Electric MWh and Meter by Class Comparison
FY 16-17 Electric Revenue and MWh by Class Comparison
FY 16-17 Electric Revenue and Meters by Class Comparison
STAFF CONTACT:
George Morrow, Denton Municipal Electric General Manager
FY 16- 17 Electric MWh and Meters by Class
FY 16-17 Electric MWh by Class FY 16-17 Electric Meters by Class
139 560
15,708 0.27 1.08%
0
1.08%
5,294
10.20%
555,350
582,670 38.31%
40.20%
45,922
88.46%
295,856
20.41%
Residential Commercial Industrial Other Residential Commercial Industrial Other
FY 16- 17 Electric MWh and Meters by Class
nI Residential Commercial Industrial
MWh by Class 555,350 582,670 ;70 8 11449,584
Meters by Class 451922 5,294 139 560 51,915
Date: September 7, 2018 Report No. 2018-123
INFORMAL STAFF REPORT
TO MAYOR AND CITY COUNCIL
SUBJECT:
Texas Open Meetings Act Training
BACKGROUND:
The City Attorney's Office (CAO)recently received a request from the City Council for
additional training on the requirements of the Texas Open Meetings Act ("TOMA"). Over the
last few years, the CAO has provided two live trainings for the City Council. The first training
was provided August 8, 2017. The second training was provided on February 7, 2017. For your
convenience, below are direct links to the full video of each TOMA presentation:
1. August 8, 2017 -http://denton-
tx.granicus.com/MediaPlayer.php?view_id=3&clip_id=1473&meta id=158558
2. February 7, 2017 -http:Hdenton-
tx.granicus.com/MediaPlayer.php?view id=3&clip_id=13 84 1
In addition to the two TOMA trainings provided this year by the CAO, supplemental guides and
training materials on TOMA are available at the following links:
1. Texas Attorney General's Office—Video Training on TOMA:
https://www.texasattomeygeneral.gov/og/oma-training
2. Texas Attorney General's Office - TOMA Handbook(2018):
https://texasattomeygeneral.gov/files/o./O�MA_handbook_2018.pdf
3. Texas Attorney General's Office -PowerPoint on TOMA (2015):
https://twc.texas.gov/files/partners/2016-conference-transparency-
government%5be2cb8e21%5d.pdf
4. Texas Municipal League - TOMA Made Easy(2017):
https://www.tml.org//p/The%20Texas%200pen%2OMeetings%2OAct%2OMade%2OEasy
%202017.pdf
5. Texas City Attorneys Association Conference— Social Media Issues (2018):
https://texascityattorneys.org/wp-content/uploads/2018/06/Lockhart_When-Can-My-
City-Delete-Paper.pdf
6. Riley Fletcher Basic Municipal Law Seminar—Open Meetings Act Basics (2018):
hgps://texascityattomeys.org/wp-content/uploads/2018/02/Kennard Texas-Open-
Meetings-Act.pdf
'The TOMA presentation is item E and begins at 2:41:38.
Date: September 7, 2018 Report No. 2018-123
The Texas Attorney General ("AG") video training satisfies the statutory requirement imposed
on public officials to complete open meetings act training. Additionally, the AG training allows
public officials to obtain a course completion certificate by following the directions on the
training vide02. While we have provided links to a few of the most frequently referenced
resources, please be aware that this is not a comprehensive list of all of the available resources on
TOMA. If any Council Member would prefer we schedule a live TOMA training for City
Council with an outside facilitator please let us know and we can include this as an item for
review and discussion during the September 18 Work Session.
STAFF CONTACT:
Aaron Leal,
City Attorney
z Direct link to obtain course completion certificate:https://texasattorneygen era l.goy/forms/openrec/og certificates.ph p
Council Requests for Information Revision Date
09/07/2018
Request Request Date Staff Responsible Status Requested B
TWU master plan and how trees are impacted;can TWU will give a brief presentation on their Master Plan
1 trees be saved and protected;next steps. 5/1/2018 McDonald during the September 18 work session. Briggs
Present information gas well setback requirements
including a history of setbacks in Denton and setback
2 requirements in other cities. 6/19/2018 Banks/Leal/McDonald Awork session is scheduled for September 11. Meltzer
ISR will be provided following a staff conversation with the
Information on implementing a similar program to City of Southlake.Will be considered with the list of future
3 Southlake's SPIN program in Denton. 6/26/2018 McDonaldBirdseye work session items on September 18. Armintor
TOMA training for the full City Council using an ISR is included in the September 7 Friday report.Will be
4 outside facilitator. 6/26/2018 Leal considered with future work session items on September 18. Armintor
Work session on permitting options to incentivize
affordable housing including a survey of practices
5 from other municipalities. 6/26/2018 Kuechler A work session is planned for September 25. Armintor
Information regarding the use of project names used ir ISR is being prepared.Will be considered with the list of
6 conjunction with economic development projects. 6/26/2018 Booth future work session items on September 18. Armintor
Work session providing an overview of the City's
Smoking Ordinance and considerations made for civil ISR is being prepared.Will be considered with the list of
7 liberties. 6/26/2018 Rosendahl/Kuechler future work session items on September 18. Armintor
Develop a strategic plan for homeless shelters in
Denton(current environment,capacity,need, Information on the first Shelter Planning Workgroup meeting
emergency circumstances,best practices,family is included in the September.Staff will provide updates as
8 shelter options). 7/17/2018 Kuechler the work progresses. Armintor/Briggs/Meltzer
ISR was included in the August 31 Friday report.Will be
Information on the potential establishment of a citizen considered with the list of future work session items on
9 advisory committee on disabilities. 7/17/2018 Canizares/Wood September 18. Armintor
Revise the Council Rules of Procedure to amend the
tie-vote provision as it impacts the Planning&Zoning
10 Commission. 7/17/2018 Leal/Wood Awork session is scheduled for September 11. Watts/Hudspeth
Comprehensive review and possible revisions to the ISR is being prepared.Will be considered with the list of
11 Council Rules of Procedure. 7/17/2018 Leal future work session items on September 18. Watts
Overview of Keep Denton Beautiful funding and
information on how other cities fund their Keep
12 America Beautiful local affiliates. 7/17/2018 CanizaresBanks ISR is included in the September 7 Friday report. Armintor
ISR is being prepared.A work session will be scheduled for
13 Overview of the Homestead Exemption process. 7/17/2018 Puente/Langley fall 2018. Armintor
Information on Code Enforcement including overview
of purpose,enforcement,and complaint response Will be considered with the list of future work session items
14 practices. 7/24/2018 Lahart/Wood on September 18. Armintor
Council Requests for Information Revision Date
09/07/2018
Request Request Date Staff Responsible Status Re uested B
Information on the Tree Code and development of a
cross-departmental strategy to address tree canopy
15 preservation. 7/24/2018 McDonald/Banks A work session is scheduled for September 18. Meltzer
Work Session on DCTA,including the City's role in
16 the current agreement and the services received. 7/24/2018 Canizares/Nelson A work session is planned for November. Watts
ISR on the number of consultants the City has hired
and the total amount spent on those contracts since
17 2017. 8/2/2018 Puente/Langley ISR is provided in the September 7 Friday report. Briggs
Update on marketing/advertising policy and naming ISR is being prepared.Will be considered with the list of
18 opportunities at City facilities. 8/2/2018 Langley/Packan future work session items on September 18. Hudspeth
Information on trespassing enforcement in public
19 parks. 8/7/2018 Packan/Smith ISR will be provided in a future Friday report. Armintor
Work Session on diversity in the Fire Department,
including barriers to employment for underrepresented ISR is being prepared.Will be considered with the list of
20 groups. 8/7/2018 Lahart/Hedges future work session items on September 18. Briggs/Armintor/Watts
Have Modern Geoscience monitor and inspect the
21 DEC. 8/21/2018 Morrow/Banks Information will be provided in a future Friday report. Briggs
Information on the feasibility of dividing Greensense
22 rebates between residential and commercial customers 8/21/2018 Morrow Information will be provided in a future Friday report. Briggs
ISR was included in the August 31 Friday report.Will be
considered with the list of future work session items on
23 Information on traffic calming options. 8/21/2018 Deshmukh September 18. Briggs
Information from Police on drug use trends across the
24 community. 8/21/2018 Smith/Mayo Information will be provided in a fixture Friday report. Briggs
Prepare a list of background friendly and rent
restricted housing options and make it available on the Information will be provided in the September 14 Friday
25 Community Development webpage. 8/21/2018 Kuechler report. Briggs
Include carbon dioxide equivalent emissions with the Information will be provided in the September 7 Friday
26 next DEC emissions report. 8/21/2018 Morrow report. Briggs
Work Session to discuss the development of a
statement on the Confederate Monument in the ISR is being prepared.Will be considered with the list of
27 Courthouse Square. 8/21/2018 Wood fixture work session items on September 18. Armintor
ISR is included in the September 7 Friday report.Will be
Reconsider Top 20 Taxpayer board member category considered with the list of fixture work session items on
d29
for the Economic Development Partnership Board. 8/21/2018 Booth September 18. Armintor
Referral to the Ethics Board to clarify that the board is Will be considered with the list of fixture work session items
not a court of law and reconsider time limits. 8/28/2018 Langley/Rosendahl/Lansford on September 18. Watts
Council Requests for Information Revision Date
09/07/2018
Request Request Date Staff Responsible Status Requested B
ISR and Legal Status Report were distributed on August 24.
Work Session on funding to provide City sponsored Will be considered with the list of future work session items
30 legal services to immigrants and low-income residents 8/28/2018 Kuechler/Wood on September 18. Armintor
31 Staff Report on MHMR Funding. 8/28/2018 Kuechler ISR will be provided in a future Friday report. Annintor
Staff report on communication plan and public
32 accommodations for upcoming capital projects. 8/28/2018 Rogers/Estes ISR will be provided in a future Friday report. Meltzer
Sensitivity analysis on raising electric rates to offset
33 residential rate decrease. 8/28/2018 Morrow ISR is provided in the September 7 Friday report. Briggs/Armintor
Analysis on the utility late payment fee for
commercial customers,including the number of
34 commercial customers that are typically late. 8/28/2018 Langley/Puente/Thomson ISR will be provided in a future Friday report. Briggs
Information outlining the justification for having
35 utility rates cover the Chamber ED contract. 8/28/2018 Booth Information is provided in the September 7 Friday report. Briggs
Model outlining the correlation between the Chamber
ED contract and its impact on retaining an recruiting
36 businesses. 8/28/2018 Booth/Morrow/Banks/Puente ISR will be provided in a future Friday report. Meltzer
Cityof Denton City Hall
215 E. McKinney St.
Denton,Texas 76201
www.cityofdenton.com
DENTON Meeting Agenda
City Council
Tuesday, September 18, 2018 1:00 PM Work Session Room&Council Chambers
After determining that a quorum is present, the City Council of the City of Denton, Texas will convene in a
Work Session on Tuesday, September 18, 2018 at 1:00 p.m. in the Council Work Session Room at City Hall,
215 E.McKinney Street,Denton,Texas at which the following items will be considered:
1. Citizen Comments on Consent Agenda Items
This section of the agenda allows citizens to speak on Consent Agenda Items only. Each speaker will be
given a total of three (3) minutes to address any items he/she wishes that are listed on the Consent Agenda.
A Request to Speak Card should be completed and returned to the City Secretary before Council considers
this item.
2. Requests for clarification of agenda items listed on the agenda for September 18,2018.
3. Work Session Reports
A. ID 18-1361 Receive a report from Texas Woman's University and hold a discussion regarding their
Master Plan.
B. ID 18-1368 Receive a report, hold a discussion and give staff direction regarding alignment options for
the Bonnie Brae Phase 4 Widening and Improvements project from IH 35 E to Scripture.
C. ID 18-1450 Receive a report, hold a discussion, and provide staff direction regarding City Council
priorities for upcoming work session report topics.
Following the completion of the Work Session, the City Council will convene in a Closed Meeting to consider
specific items when these items are listed below under the Closed Meeting section of this agenda. The City
Council reserves the right to adjourn into a Closed Meeting on any item on its Open Meeting agenda consistent
with Chapter 551 of the Texas Government Code,as amended,or as otherwise allowed by law.
1. Closed Meeting:
ANY FINAL ACTION, DECISION, OR VOTE ON A MATTER DELIBERATED IN A CLOSED
MEETING WILL ONLY BE TAKEN IN AN OPEN MEETING THAT IS HELD IN COMPLIANCE
WITH TEXAS GOVERNMENT CODE, CHAPTER 551, EXCEPT TO THE EXTENT SUCH FINAL
ACTION, DECISION, OR VOTE IS TAKEN IN THE CLOSED MEETING IN ACCORDANCE WITH
THE PROVISIONS OF §551.086 OF THE TEXAS GOVERNMENT CODE (THE `PUBLIC POWER
EXCEPTION'). THE CITY COUNCIL RESERVES THE RIGHT TO ADJOURN INTO A CLOSED
MEETING OR EXECUTIVE SESSION AS AUTHORIZED BY TEX. GOV'T. CODE, §551.001, ET
SEQ. (THE TEXAS OPEN MEETINGS ACT) ON ANY ITEM ON ITS OPEN MEETING AGENDA
OR TO RECONVENE IN A CONTINUATION OF THE CLOSED MEETING ON THE CLOSED
MEETING ITEMS NOTED ABOVE, IN ACCORDANCE WITH THE TEXAS OPEN MEETINGS
ACT, INCLUDING, WITHOUT LIMITATION §551.071-551.086 OF THE TEXAS OPEN MEETINGS
ACT.
Page 1 Printed on 91712018
City Council Meeting Agenda September 18,2018
Regular Meeting of the City of Denton City Council at 6:30 p.m. in the Council Chambers at City Hall, 215 E.
McKinney Street,Denton,Texas at which the following items will be considered:
1. PLEDGE OF ALLEGIANCE
A. U.S. Flag
B. Texas Flag
"Honor the Texas Flag—I pledge allegiance to thee,Texas,one state under God,one and indivisible."
2. BUDGET ITEMS FOR INDIVIDUAL CONSIDERATION
A. ID 18-1453 Consider adoption of an ordinance of the City of Denton, Texas, levying the ad valorem
property tax of the City of Denton, Texas, for the year 2018, on all taxable property
within the corporate limits of the city on January 1, 2018, and adopting a tax rate of
$0.620477 per $100 of valuation for 2018; providing revenues for payment of current
municipal maintenance and operation expenses and for payment of interest and principal
on outstanding City of Denton debt; providing for limited exemptions of certain
homesteads; providing for enforcement of collections; providing for a severability clause;
and providing an effective date.
B. ID 18-1454 Consider adoption of an ordinance of the City of Denton, Texas, approving the 2018 tax
rolls; and providing an effective date.
C. ID 18-1456 Consider adoption of an ordinance of the City of Denton, Texas, adopting the Fiscal Year
2018-2019 Annual Program of Services (Budget) and the Capital Improvement Program
of the City of Denton, Texas, for the fiscal year beginning on October 1, 2018, and
ending on September 30,2019;and declaring an effective date.
D. ID 18-1457 Consider adoption of an ordinance of the City of Denton, Texas, ratifying the adoption of
the Fiscal Year 2018-2019 Annual Program of Services (Budget) and the Capital
Improvement Program of the City of Denton, Texas, for the fiscal year beginning October
1, 2018, and ending on September 30, 2019 when the Budget will raise more revenue
from property taxes than last year's budget; and providing an effective date.
3. PROCLAMATIONS/PRESENTATIONS
A. ID 18-1512 Effie Ruth Webb McQueen Day
B. ID 18-1513 Barney Cosimo Day
4. PRESENTATION FROM MEMBERS OF THE PUBLIC
A. Review of procedures for addressing the City Council.
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City Council Meeting Agenda September 18,2018
B. Receive Scheduled Citizen Reports from Members of the Public. This section of the agenda permits
any person who has registered in advance to make a citizen report regarding a public business item he or
she wishes to be considered by the City Council. This is limited to no more than four (4) speakers per
meeting with each speaker allowed a maximum of four (4) minutes to present their report. At the
conclusion of each report, the City Council may pose questions to the speaker or may engage in
discussion. If the City Council believes that a speaker's report requires a more detailed review, the City
Council will give the City Manager or City Staff direction to place the item on a future work session or
regular meeting agenda and advise staff as to the background materials to be desired at such meeting.
1. ID 18-1415 Henry Jason regarding a committee for the handicapped.
C. Additional Citizen Reports - This section of the agenda permits any person not registered for a citizen
report to make comments regarding public business on items not listed on the agenda. This is limited to
two speakers per meeting with each speaker allowed a maximum of four (4) minutes. Such person(s) shall
have filed a"Blue Card"requesting to speak during this period prior to the calling of this agenda item.
NOTE: If audio/visual aids during presentations to Council are needed, they must be submitted to the City
Secretary 24 hours prior to the meeting.
5. CONSENT AGENDA
Each of these items is recommended by the Staff and approval thereof will be strictly on the basis of the
Staff recommendations. Approval of the Consent Agenda authorizes the City Manager or his designee to
implement each item in accordance with the Staff recommendations. The City Council has received
background information and has had an opportunity to raise questions regarding these items prior to
consideration.
Listed below are bids, purchase orders, contracts, and other items to be approved under the Consent
Agenda (Agenda Items A — FF). This listing is provided on the Consent Agenda to allow Council Members
to discuss or withdraw an item prior to approval of the Consent Agenda. If no items are pulled, Consent
Agenda Items A — FF below will be approved with one motion. If items are pulled for separate discussion,
they may be considered as the first items following approval of the Consent Agenda.
A. ID 18-1123 Consider adoption of an ordinance of the City of Denton, Texas, amending Section
22-31(13) and 22-31.1, Article II-Park Rules, Chapter 22- Parks and Recreation, Code
of Ordinances of the City of Denton, Texas, to provide for clarification of smoking related
to parks and parks facilities within the City of Denton; providing for a severability clause;
providing for a savings clause;providing for publication; and,declaring an effective date.
B. ID 18-1238 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a Professional Services
Agreement with Pike Engineering, LLC., for electric engineering services to provide
distribution design, construction and standards; distribution system planning services; new
distribution customer project designs; project quality control services; and perform
distribution system studies for Denton Municipal Electric distribution engineering;
providing for the expenditure of funds therefor; and providing an effective date (RFQ
6566 - awarded to Pike Engineering, LLC., for one (1) year, with the option for two (2)
additional one (1) year extensions, in a total not-to-exceed amount of $900,000 for all
years). The Public Utilities Board recommends approval(-).
C. ID 18-1303 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
Page 3 Printed on 91712018
City Council Meeting Agenda September 18, 2018
municipal corporation, authorizing the City Manager to execute an Interlocal Cooperative
Purchasing Agreement with the University of North Texas, under the Government Code,
Chapter 791.001, to authorize City of Denton contracts for the purchase of internet
services; authorizing the expenditure of funds therefor; and declaring an effective date (File
6860- award an Interlocal Cooperative Purchasing Agreement with University of North
Texas System for a three(3)year not-to-exceed amount of$30,000).
D. ID 18-1321 Consider adoption of an ordinance of the City Council of the City of Denton, Texas,
amending the Downtown Incentive Reinvestment Grant Program; and providing an
effective date.
E. ID 18-1383 Consider adoption of a resolution approving the City of Denton's GreenSense Incentive
Program Manual, and Distributed Generation Manual for FY 2018-19; providing for an
effective date. The Public Utilities Board recommends approval(7-0).
F. ID 18-1395 Consider adoption of an ordinance of the City of Denton, Texas establishing the schedule
of rates for electric service; providing for a repealer; providing for a severability clause;
and providing for an effective date. The Public Utilities Board recommends approval
(6-0).
G. ID 18-1402 Consider adoption of an ordinance of the City of Denton authorizing an agreement
between the City of Denton, Texas and Giving Hope, Incorporation for Homeless
Prevention Assistance; providing for the expenditure of funds in the total amount of Four
Hundred Dollars($400); and providing an effective date.
H. ID 18-1423 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a contract for the supply
of electric utility distribution hardware, connectors, arms, and accessories for the City of
Denton Distribution Center; providing for the expenditure of funds therefor; and providing
an effective date (IFB 6653 - awarded to the lowest responsive bidder for each line item,
Stuart C. Irby Company, for one (1) year, with the option for three (3) additional one (1)
year extensions, in a total not-to-exceed amount of $500,000 for all years, and Techline,
Inc., for one (1) year, with the option for three (3) additional one (1) year extensions, in a
total not-to-exceed amount of $4,000,000 for all years, in a total not-to-exceed amount
of$4,500,000 for all years).
I. ID 18-1424 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a contract through the
Department of Information Resources (DIR) Cooperative Purchasing Network Contract
Number DIR-TSO-4158 for the supply of software maintenance for the City of Denton
Human Capital Management software; providing for the expenditure of the funds therefor;
and providing an effective date (File 6876- awarded to Oracle America, Inc. for one (1)
year,in the not-to-exceed amount of$140,820).
J. ID 18-1426 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a contract through the
State of Texas Contract Number 715-M2, under the Texas Government Code, Chapter
2262.055, to authorize City of Denton contracts for the purchase of library print materials:
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City Council Meeting Agenda September 18,2018
Publications, Audiovisual Materials, Books, and Cataloging Services (Prepared Materials
Only); authorizing the expenditure of funds therefor; and declaring an effective date (File
6886 -awarded to Baker&Taylor,LLC,in the not-to-exceed amount of$350,000).
K. ID 18-1427 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager, or his designee, to execute a
contract through the State of Texas Contract Number 715-M2 for the purchase of library
audio/visual materials: Publications, Audiovisual Materials, Books, and Cataloging
Services (Prepared Materials Only); providing for the expenditure of funds therefore; and
providing an effective date (File 6887 - awarded to Midwest Tape, LLC, in the
not-to-exceed amount of$150,000).
L. ID 18-1429 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a Professional Services
Agreement with RPS Infrastructure, Inc., for design services for the Bonnie Brae Phase 6
University (US 380) to Loop 288 street improvement project as set forth in the
contract; providing for the expenditure of funds therefor; and providing an effective date
(RFQ 6590-032 - Professional Services Agreement for design services awarded to RPS
Infrastructure, Inc., in the not-to-exceed amount of $2,031,479.50). The Public Utilities
Board recommends approval(-).
M. ID 18-1431 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a Professional Services
Agreement with Kimley-Horn and Associates, Inc. for an Americans with Disabilities
(ADA) Act Compliance Review and Transition Plan as set forth in the agreement;
providing for the expenditure of funds therefor; and providing an effective date (RFQ
6590-033 - Professional Services Agreement for Design Services awarded to
Kimley-Horn and Associates,Inc., in the not-to-exceed amount of$239,843.32).
N. ID 18-1445 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a contract for the
purchase and implementation of a new work order software system for the Facilities
Management Department with TMA System, LLC, which is the sole provider of this
software. In accordance with Texas Local Government Code 252.022, provides that
procurement of commodities and services that are available from one source are exempt
from competitive bidding; and if over $50,000 shall be awarded by the governing body;
and providing an effective date (File 6892 - awarded to TMA System, LLC, for one (1)
year, with the option for two (2) additional one (1) year extensions, in a total
not-to-exceed amount of$60,680 for all years).
O. ID 18-1448 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation authorizing the City Manager, or designee, to execute an agreement
with the United States Department of Justice, Drug Enforcement Administration (DEA)
for reimbursement of overtime costs for participation in the Dallas Field Division Area
Task Force Group 1 for Fiscal Year 2019; and providing an effective date.
P. ID 18-1449 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal
corporation authorizing the City Manager, or designee, to execute an agreement with the
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City Council Meeting Agenda September 18,2018
United States Department of Justice for participation in the Federal Equitable Sharing
Program for Fiscal Year 2019; and providing an effective date.
Q. ID 18-1460 Consider adoption of an ordinance of the City of Denton, Texas amending the Fiscal Year
2017-18 Budget and Annual Program of Services of the City of Denton to allow for
increases to: (A) the General Fund of $828,191 for the purpose of funding equipment,
two master plans, and Park improvements, and (B) the Risk Fund of $75,000 for the
purpose of funding additional claims; declaring a municipal purpose; providing a
severability clause;providing an open meetings clause; and providing for an effective date.
R. ID 18-1464 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a Professional Service
Agreement with Freese and Nichols, Inc., to conduct condition assessment, provide
preliminary design and regulatory and performance upgrades for the facilities at the Lake
Ray Roberts water treatment plant (RRWTP) as set forth in the contract; providing for the
expenditure of funds therefor; and providing an effective date (RFQ 6700 - Professional
Services Agreement awarded to Freese and Nichols, Inc., in the not-to-exceed amount of
$224,411). The Public Utilities Board recommends approval(-).
S. ID 18-1465 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a contract with
SigmaFlow, LLC, for NERC compliance software services for the City of Denton;
providing for the expenditure of funds therefor; and providing an effective date. (RFP
6704- awarded to SigmaFlow, LLC, for one (1) year, with the option for four (4)
additional one (1) year extensions, in a total not-to-exceed amount of $311,250 for all
years). The Public Utilities Board recommends approval(-).
T. ID 18-1466 Consider adoption of an ordinance of the City of Denton authorizing the City Manager, or
his designee, to execute a Memorandum of Understanding by and between United Way
of Denton County, Inc., and the City of Denton and providing for the expenditure of funds
for Homelessness Initiatives in the amount of $107,748.00 for the partial funding for a
Homelessness Coordinator, Coordinated Entry Coordinator, and Housing Navigator in
furtherance of the coordinated system homeless assistance programs; authorizing the
expenditure of funds therefor; and providing an effective date.
U. ID 18-1472 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a Professional Services
Agreement with Adams Consulting Engineers, Inc., a Texas Corporation, for a
design/construction plan set for 23 sidewalk segments throughout the city; as set forth in
the agreement; providing for the expenditure of funds therefor; and providing an effective
date (File # 6590-035 - Professional Services Agreement for services awarded to Adams
Consulting Engineers, Inc., a Texas Corporation, in the not-to-exceed amount of
$223,800).
V. ID 18-1474 Consider adoption of an ordinance releasing, abandoning, and vacating a 3.625 acre
portion of a 5.886 acre electric utility and hike and bike trail easement granted to the City
of Denton by Holigan Land Development, Ltd., a Texas limited partnership, recorded as
Instrument No. 2005-140655, Real Property Records, Denton County, Texas; Providing
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City Council Meeting Agenda September 18, 2018
for severability and an effective date. (Carmel Villas-Phase I subdivision development)
W. ID 18-1477 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a Professional Services
Agreement with Freese and Nichols, Inc. (FNI), for Airport Road Analysis, Design, and
Construction Administration Services as set forth in the contract; providing for the
expenditure of funds therefor; and providing an effective date (RFQ 6590-038 -
Professional Services Agreement for Pre-Qualified Engineering Services awarded to
Freese and Nichols,Inc., in the not-to-exceed amount of$168,300).
X. ID 18-1478 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal
corporation, accepting competitive bids and awarding a contract for the supply of Electric
Utility Overhead and Underground Distribution Transformers for the City of Denton
Distribution Center; providing for the expenditure of funds therefor; and providing an
effective date (IFB 6778 - awarded to Techline, Inc., in the five (5) year not-to-exceed
amount of$11,000,000).
Y. ID 18-1480 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, accepting competitive bids and awarding a contract for the supply
of precast concrete pull boxes for the City of Denton Distribution Center to Techline, Inc.;
providing for the expenditure of funds therefor; and providing an effective date (IFB 6812
- awarded to Techline, Inc., in the for a five (5) year not-to-exceed amount of
$2,500,000).
Z. ID 18-1481 Consider adoption of an ordinance of the City of Denton, a Texas home-rule municipal
corporation, accepting competitive bids and awarding a contract for Wood Utility Poles
for the City of Denton Distribution Center to McFarland Cascade Holdings, Inc.;
providing for the expenditure of funds therefor; and providing an effective date (IFB 6813
- awarded to McFarland Cascade Holdings, Inc. in the five (5) year not-to-exceed
amount of$2,500,000).
AA. ID 18-1486 Consider adoption of an ordinance of the City of Denton, adopting a schedule of fees for
services and fees of the Denton Fire Department; superseding all prior fees in conflict with
such schedule;providing for severability; and providing for an effective date.
BB. ID 18-1488 Consider adoption of an ordinance of the City of Denton, Texas, adopting a Schedule of
Fees for cemeteries and use of certain park facilities; superseding all prior fees in conflict
with such schedule; and providing for severability and an effective date. The Parks,
Recreation and Beautification Board recommended approved(4-0).
CC. ID 18-1490 Consider adoption of an ordinance establishing the schedule of rates for Water service;
providing for a repealer; providing for a severability clause; and providing for an effective
date. The Public Utilities Board recommends approval(6-0)
DD. ID 18-1492 Consider adoption of an ordinance establishing the schedule of rates for Wastewater
service; providing for a repealer; providing for a severability clause; and providing for an
effective date. The Public Utilities Board Recommends approval(6-0).
EE. ID 18-1493 Consider adoption of an ordinance establishing the Schedule of Rates for Solid Waste
Page 7 Printed on 91712018
City Council Meeting Agenda September 18,2018
service; providing for a repealer; providing for a severability clause; and providing for an
effective date. The Public Utilities Board recommends approval. (6-0)
FF. ID 18-1494 Consider adoption of an ordinance establishing the schedule of rates for miscellaneous
service; providing for a repealer; providing for a severability clause; and providing for an
effective date. The Public Utilities Board recommends approval(6-0).
6. ITEMS FOR INDIVIDUAL CONSIDERATION
A. ID 18-1459 Consider approval of a resolution of the City Council of the City of Denton, Texas,
approving a negotiated settlement between the Atmos Cities Steering Committee
("ACSC") and Atmos Energy Corp., Mid-Tex division regarding the company's 2018
rate review mechanism filings; declaring existing rates to be unreasonable; adopting tariffs
that reflect rate adjustments consistent with the negotiated settlement; finding the rates to
be set by the attached settlement tariffs to be just and reasonable and in the public
interest; approving an attached exhibit establishing a benchmark for pensions and retiree
medical benefits; approving an attached exhibit regarding amortization of regulatory
liability; requiring the company to reimburse ACSC's reasonable ratemaking expenses;
determining that this resolution was passed in accordance with the requirements of the
Texas open meetings act; adopting a savings clause; declaring an effective date; and
requiring delivery of this resolution to the company and the ACSC's legal counsel.
B. ID 18-1470 Consider adoption of an ordinance accepting a donation from the Rayzor-Elliott family via
the Denton Parks Foundation for IOOF Cemetery.
C. ID 18-1482 Consider adoption of an ordinance of the City of Denton, Texas, a Texas home-rule
municipal corporation, authorizing the City Manager to execute a Professional Services
Agreement with HR Green, Inc., for Development Review Consulting Services as set
forth in the contract; providing for the expenditure of funds therefor; and providing an
effective date (RFQ 6818 - Professional Services Agreement for Development Review
Consulting Services awarded to HR Green,Inc).
D. ID 18-1484 Consider adoption of an ordinance of the City of Denton, Texas authorizing the City
Manager, or his designee, to execute a Contract of Sale by and between Janda Legacy
Investments, LP ("Owner"), and the City of Denton, Texas ("City" or "Buyer"), regarding
the sale and purchase of fee simple to an approximately 0.81 acre tract, more or less,
situated in the B.B.B. & C.RR. CO. Survey, Abstract No. 192, Denton County, Texas
for the purchase price of Four Hundred Seventy Five Thousand Dollars and No Cents
($475,000.00), and other consideration, as prescribed in the Contract of Sale; authorizing
the expenditure of funds therefor; and providing an effective date. (Bonnie Brae Street
Widening and Improvements project - North (Phase 5) - Parcel 31 (Janda - 2300
Scripture Street))
7. PUBLIC HEARINGS
A. S17-0007a Hold a public hearing and consider adoption of an ordinance for a Specific Use Permit to
allow for a multi-family use. The 12.37-acre site is generally located on the east side of
Brinker Road, approximately 990 feet south of South Loop 288 in the City of Denton,
Page 8 Printed on 91712018
City Council Meeting Agenda September 18, 2018
Denton County, Texas; providing for a penalty in the maximum amount of $2,000.00 for
violations thereof, providing a severability clause and an effective date. (S17-0007,
Enclave at Denton,Hayley Zagurski).
B. Z18-0020b Hold a public hearing and consider adopting an ordinance of the City of Denton, Texas,
regarding assignment of an initial zoning classification of Neighborhood Residential 3
(NR-3) zoning district and use classification on approximately 47.466 acres of land
generally located on the south side of E. Ryan Road, east of the intersection of E. Ryan
Road and Andrew Avenue, in the City of Denton, Denton County, Texas; adopting an
amendment to the city's official zoning map; providing for a penalty in the maximum
amount of $2,000.00 for violations thereof, providing a severability clause and an effective
date. The Planning and Zoning Commission will consider this request on September 21,
2018.
C. Z18-0016a Hold a public hearing and consider adoption of an ordinance of an initial zoning of
Neighborhood Residential 1 (NR-1) District on approximately one acre. The property is
generally located on the north side of Shiloh Lane, approximately 910 feet east of Swisher
Road, in the City of Denton, Denton County, Texas; adopting an amendment to the City's
official zoning map; providing for a penalty in the maximum amount of $2,000.00 for
violations thereof, providing a severability clause and an effective date. The Planning and
Zoning Commission voted 7-0 to approve the request. (Z18-0016, Burling Kuhn
Addition,Julie Wyatt).
D. PDA18-0004b Hold a public hearing and reconsider the August 21, 2018 adoption of an ordinance
approving a Detail Plan for Planned Development 176(PD-176) District depicting an
auto laundry facility on approximately 2.13 acres. The property is generally located on
the west side of North FM 2499, approximately 760 feet north of Hickory Creek Road
in the City of Denton, Denton County, Texas; providing for a penalty in the maximum
amount of $2,000.00 for violations thereof, providing a severability clause and an effective
date. (PDA18-0004a,Clean and Green Car Wash,Hayley Zagurski.)
8. CONCLUDING ITEMS
A. Under Section 551.042 of the Texas Open Meetings Act, respond to inquiries from the City Council
or the public with specific factual information or recitation of policy, or accept a proposal to place the
matter on the agenda for an upcoming meeting AND Under Section 551.0415 of the Texas Open
Meetings Act, provide reports about items of community interest regarding which no action will be taken,
to include: expressions of thanks, congratulations, or condolence; information regarding holiday schedules;
an honorary or salutary recognition of a public official, public employee, or other citizen; a reminder about
an upcoming event organized or sponsored by the governing body; information regarding a social,
ceremonial, or community event organized or sponsored by an entity other than the governing body that
was attended or is scheduled to be attended by a member of the governing body or an official or employee
of the municipality; or an announcement involving an imminent threat to the public health and safety of
people in the municipality that has arisen after the posting of the agenda.
B. Possible Continuation of Closed Meeting topics,above posted.
CERTIFICATE
Page 9 Printed on 91712018
City Council Meeting Agenda September 18, 2018
I certify that the above notice of meeting was posted on the bulletin board at the City Hall of the City of
Denton, Texas,on the day of ,2018 at o'clock(a.m.)(p.m.)
CITY SECRETARY
NOTE: THE CITY OF DENTON CITY COUNCIL WORK SESSION ROOM AND COUNCIL
CHAMBERS ARE ACCESSIBLE IN ACCORDANCE WITH THE AMERICANS WITH
DISABILITIES ACT. THE CITY WILL PROVIDE SIGN LANGUAGE INTERPRETERS FOR THE
HEARING IMPAIRED IF REQUESTED AT LEAST 48 HOURS IN ADVANCE OF THE SCHEDULED
MEETING. PLEASE CALL THE CITY SECRETARY'S OFFICE AT 349-8309 OR USE
TELECOMMUNICATIONS DEVICES FOR THE DEAF (TDD) BY CALLING 1-800-RELAY-TX SO
THAT A SIGN LANGUAGE INTERPRETER CAN BE SCHEDULED THROUGH THE CITY
SECRETARY'S OFFICE.
Page 10 Printed on 91712018
wmm::�I September 2018
Sunday Monday Tuesday Wednesday 'hursday Friday Saturday
1
2 3 4 5 6 7 8
No Councilluncheon No Council Meeting 4 p.m. Public Art 11:00 Development
Labor Day - Committee Code Review
City Ho lid a y
9 10 11 12 13 14 15
9:OOam Public Utilities 11:OOam EDP Board 11:00 Development
Board 11:00am Mobility Code Review
Committee 5:OOpm P&ZWork
5:30pm HLC Session
2:00 Special Called 6:30pm P&ZRegular
6 pm Park Board Work/Reg.Session Session
16 17 18 19 20 21 22
9:OOam Committee on 10:30am Audit/Finance HaBSCo Meeting 11:00 Development
the Fnvironment Committee Code Review
1:00 pm CC Work
Session
6:30 pm CC Regular
Session
23 24 25 26 27 28 29
6:OOpm Pub he Utilities 2:00 pm 4th Tuesday 12:00 Downtown TF HOTCommittee 10:00 11:00 Development
Board Session Code Review
5:OOpm P&Z Work
4:00 pm ZBA Session
6:30pm P&ZRegular
Se ssio n
30
9/7/2018 10:12 AM
Sunday Monday Tuesday Wednesday Mursday Friday Saturday
1 2 3 4 5 6
11:30 am Joint No Council Meeting 4 p.m. Public Art
Counc ii/DISD Luncheon Committee
1:30pm Committee on
the Fnvironment
5:3 0p m Traffic Sa fe ty
Commission
Park Board 6pm
7 8 9 10 11 12 13
9:00am Public Utilities 2:00 pm 2nd Tuesday 11:00am EDP Board
Bo a rd Se ssio n
5:00pm P&ZWork
5:30pm HLC Session
6:30pm P&ZRegular
Se ssio n
14 15 16 17 18 19 20
2:00 pm CC Work 11:30am Mobility HaBSCo Meeting
Session Committee
6:30 pm CC Regular
Session
21 22 23 24 25 26 27
6:00pm Public Utilities 2:00 pm 4th Tuesday 5:00pm P&ZWork
Bo a rd Se ssio n Se ssio n
6:30pm P&ZRegular
Se ssio n
28 29 30 31
4:00 pm ZBA No Council Meeting
9/7/2018 10:12 AM
Construction Projects Report
Week of September 10-16, 2018 lI rft�V11 Val
ciry
OF
DENT(�N For general inquiries and questions, please contact the Project Management Office at(940)349-7227 EDN
Proposed Date of Proposed Date Other Department
Street/Intersection From To Construction of Completion Brief Description of Construction Department Letters Communication Contact:
CURRENT PROJECTS See Yellow Highlighted for Major Closures
Amistad Ln. New Ballinger Tawakoni 8/27/18 9/10/18 Concrete Street Panel Repair Streets 7/15/18 (940)349-7160
(Temporary Lane Closures)
Austin St. Sawyer E.Third 9/10/2018 9/14/2018 Water Main Construction Engineering 8/27/18 (940)349-8910
(Temporary Lane Closure)
Ave.A Maple Eagle 3/19/18 9/30/18 UNT 2018 Residence Hall Project Engineering N/A Coordinate with (940)349-8910
(Both SB Lanes Closed) UNT
Bay Meadow Dr. Prescott Fairmont Park 8/27/18 9/10/18 Concrete Street Panel Repair Streets 8/17/18 (940)349-7160
Downs (Temporary Lane Closures Possible)
Bonnie Brae St. Roselawn North of 7/1/2017 7/1/2019 Street Widening Engineering 6/14/18 (940)349-8910
Vintage (Phase 1)
S. Bonnie Brae St. Willowwood FM 1515/Road 9/10/2018 9/21/2018 Street Resurfacing Engineering (940)349-8910
Airport p (Temporary Lane Closures Possible)
Edwards Rd. Camino Real Swisher Rd. 6/4/18 9/10/18 Street Reconstruction Streets 5/17/18 HOA Contacted (940)349-7160
TH. (Temporary Lane Closures)
Emerson m East E Wastewater
Emerson Ln. Nottingham 7/25/18 9/12/18 (Road and Lane Closure) Wastewater 7/23/18 (940)349-7300
Emery St. Alice Coit 6/25/18 10/12/18 Street Resurfacing Streets 6/11/18 Door Hangers (940)349-7160
(Temporary Lane Closures)
Fulton St. Oak University 6/7/18 11/16/18 Water Main Construction Water 6/5/18 (940)349-7167
(Street Closure)
Page 1 of 5
Proposed Date of Proposed Date Other Department
Street/Intersection From To Construction of Completion I Brief Description of Construction Department Letters Communication Contact:
North Texas Street Reconstruction
Hickory St. Blvd. Ave C 5/21/18 9/14/18 (Temporary Road Closures) Streets 5/15/18 Electronic Signs (940)349-7160
Wastewater Main Construction
Holiday Park Manhattan Kings Row 11/10/17 12/1/18 Phase II Wastewater 11/16/18 Door Hangers (940)349-7300
(Temporary Lane Closures Possible)
rid Holl hill Ln. Long Pennsylvania 7 9 18 9/7/18 Street Reconstruction Streets 6 20 18 (940 349-7160
Holly
ge / / (Temporary Street Closures) / / )
Jim Christal Rd. Western Blvd Scripture 7/3/18 10/1/18 Utility Line ConstructionWater/WW N/A (940)349-8463
(Road Closure)
Joyce Ln. N. Elm Gardenview 9/5/18 10/26/18 Street Reconstruction Streets 8/21/18 (940)349-7160
(Temporary Lane Closures)
Mayhill Rd. US 380 Edwards 9/1/17 2/1/20 Street Widening Engineering 1/3/18, 1/24/18 Door Hangers (940)349-8910
(Temporary Lane Closures)
Meandering Creek Dr. Education John Pain 9/3/18 9/17/18 Concrete Street Panel Repair Streets 8/17/18 (940)349-7160
(Temporary Lane Closures)
Mistywood Ln. Woodhaven Jamestown 9/13/18 11/25/18 Wastewater Main ReconstructionWastewater 8/23/18 (940)349-7300
(Temporary Lane Closures)
Myrtle St. Eagle 200' North 9/4/18 5/1/19 Eagle Drainage Improvements Engineering 8/21/18 Contacted DCTA (940)349-8910
(Street Closure)
100' N 150'East Wastewater Main Reconstruction
Nottingham Dr. Nottingham Emerson (Temporary Lane Closures)7/25/18 9/7/18 Wastewater 7/23/18 (940)349-7300
intersection
Old North Rd. University Mingo 8/27/18 9/7/18 Turn Lane Installation Streets N/A (940)349-7160
(Temporary Lane Closures)
Prominence Pkwy. Mayhill Atlanta 1/31/18 9/28/18 Water and Wastewater Crossing Engineering 1/24/18 Door Hangers (940)349-8910
(Road Closure)
Riney Rd. N. Elm Solana 9/29/17 9/30/18 Road Removal and Replacement Engineering Yes Electronic Signs (940)349-8910
(Road Closure)
Full Depth Base Repairs Contacted
Shady Oaks Dr. Woodrow Loop 288 S. 8/27/18 9/17/18 (East Bound Lane Closures) Streets N/A Businesses (940)349-7160
affartarl alartrnnir
Page 2 of 5
Proposed Date of Proposed Date Other Department
Street/Intersection From To Construction of Completion I Brief Description of Construction Department Letters Communication Contact:
Shadow TH. Plum Hollow Windbrook 8/6/18 10/19/18 Street Reconstruction Streets 8/2/18 (940)349-7160
(Street Closure)
Spencer Rd. Mayhill Lowe's 4/2/18 9/29/18 Water, Drainage, Road Construction Water 3/16/18 Contacted (940)349-8910
Driveway (Road Closure) departments affected
Dead End Street Resurfacing,Curb and Gutter
Sun Valley Dr. Stuart West 5/14/18 10/12/18 (Temporary Lane Closures) Streets 5/1/18 Door Hangers (940)349-7160
Thomas St. Oak Scripture 9/3/18 11/2/18 Water Main Construction Water 8/1/18 (940)349-7167
(Temporary Lane Closure)
Thomas St. TBD TBD Streets Construction
Valley View Rd. Kings Row Sun Valley 5/14/18 10/18/18 Street Resurfacing,Curb and Gutter Streets 5/1/18 Door Hangers (940)349-7160
(Temporary Lane Closures)
W.Walnut St. Elm Cedar 8/6/18 9/14/18 Utility Construction Engineering N/A (940)349-8910
(Temporary Road Closures)
Wayne St. Boyd Mozingo 8/29/18 11/1/18 Wastewater Reconstruction Wastewater 8/20/18 (940)349-7300
(Temporary Lane Closures)
UNT 2018 CVAD Project
Welch St. Mulberry Chestnut 4/11/18 9/24/18 Drive approach/Sidewalk Engineering 3/19/18 3/30/2018 (940)349-8910
(Temporary Lane Closures)
COMPLETED PROJECTS
Amarillo St. Congress Egan 7/9/18 8/17/18 Street Reconstruction Streets (940)349-7160
(Temporary Lane Closures) 7/5/18
Capetown Dr. Desert Willow Bishop Pine 6/25/18 8/17/18 Concrete Street Panel Repair Streets 6/5/18 Door Hangers (940)349-7160
(Temporary Lane Closures Possible)
Highland Park Rd. Laurel Wisteria 7/25/18 8/30/18 Street Reconstruction Streets 7/12/18 (940)349-7160
(Temporary Road Closures)
Page 3 of 5
Proposed Date of Proposed Date Other Department
Street/Intersection From To Construction of Completion I Brief Description of Construction Department Letters Communication Contact:
Laurel St. Highland Park Wisteria 7/25/18 8/30/18 Street Reconstruction Streets 7/12/18 (940)349-7160
(Temporary Lane Closures)
p y / / / / Street Reconstruction / / g ( )
Malone St. Scripture W. University 7 9 18 8 24 18 Streets 6 28 18 Electronic Signs 940 349-7160
(Temporary Lane Closures)
McKinney St. Loop 288 Ryan H.S 5/29/18 8/22/18 Sidewalk Construction Engineering N/A Electronic Signs (940)349-8910
(Temporary Lane Closures)
Oakland St. Sawyer E. 3rd 8/20/18 8/26/18 Conduit Installation TWU (940)349-8914
(Temporary Lane Closures) Communications
Pine Hills Ln. Purbeck Alderbrook 8/20/18 9/3/18 Concrete Street Panel Repair Streets N/A (940)349-7160
(Temporary Lane Closures Possible)
Poinsettia St. Manten Teal 8/13/18 8/27/18 Wastewater Construction Engineering 8/3/18 Door Hangers (940)349-8910
(Temporary Lane Closure)
NB Lane 500' Water and Wastewater Improvements Contacted
Western Blvd. es S.tern N of J affected electronic
im 7/24/18 9/21/18 Westpark Area Water N/A Businesses
Wes (940)349-7324
Christal (Lane Closures 4 to 2 lanes) i
signs
UPCOMING PROJECTS
Bonnie Brae St. Roselawn 135E 1/15/19 1/15/20 North South Water Main Phase 2Water (940)349-8910
(Temporary Lane Closures)
Eagle Dr. East of Elm 9/17/18 10/5/18 Sanitary Sewer Construction Engineering (940)349-8910
Carroll (Street Closure)
Fulton St. Summer 2019 TBD Streets Streets (940)349-7160
Hettie St. TBD TBD Water,Wastewater,and Streets Multiple
Hickory Creek Rd. Teasley Riverpass 1/1/19 6/1/20 Street Widening Engineering (940)349-8910
(Temporary Lane Closures)
Page 4 of 5
Proposed Date of Proposed Date Other Department
Street/Intersection From To Construction of Completion I Brief Description of Construction Department Letters Communication Contact:
Highland St.
Phase I-Storm Water Improvements
Hinkle Dr. University Windsor 1/1/19 1/1/20 (Magnolia Drainage Ph 11 Engineering (940)349-8910
Temporary Lane Closures)
Londonderry Ln. Teasley Westminster 11/1/18 TBD Street Improvements Streets (940)349-7160
(Temporary Lane Closures)
Panhandle St. Carroll Bolivar TBD TBD Street Resurfacing,Curb and Gutter Streets 4/9/18 Door Hangers (940)349-7160
(Temporary Lane Closures)
PEC 4- Engineering In Design Installing Underground Box Culvert Engineering (940)349-8910
Kansas City Drainage and Roadway Construction
Roselawn Dr. Bonnie Brae Southern RR TBD TBD (Bonnie Brae Phase 1 Engineering N/A (940)349-8910
One Lane traffic control)
Stuart Rd. Windsor Kings Row TBD TBD Concrete Curb and Gutter Repair Streets (940)349-7160
(Temporary Lane Closures)
Vintage Blvd. US 377 135W 3/1/2019 2021 Street Widening Engineering (940)349-8910
(Bonnie Brae Phase 2)
Windsor Dr. TBD TBD Water,Wastewater, Drainage,Streets Engineering (940)349-8910
Page 5 of 5