HISD settles with comptroller

The dispute between HISD and the Comptroller's office over the disparity between what the latter says Harris County's property values are and what the appraisal district collected has been resolved.

The Houston school board accepted a settlement Thursday with the state comptroller's office that places the district's property values at $97.6 billion -- about $13 billion less than the state estimated.

HISD Inspector General Bob Moore applauded the settlement, saying HISD was prepared to sue Comptroller Susan Combs' office for overvaluing the district's property, costing the district about $3 million a year in state funding.

"It saves time and effort," Moore said.

State officials estimated HISD's 301 square miles to be worth $110.7 billion, while Harris County appraisals put the property at $97.6 billion.

The settlement is in the Houston school system's best interest because the state appraisal figures are used to determine whether a district is considered property wealthy, while the county appraisals are used for tax collection.

"You're paying on something you never collected," said Melinda Garrett, HISD's chief financial officer.

[...]

At this point, HISD's funding comes almost entirely from local property tax revenue. As values continue to increase, HISD will have to cut a check to redistribute some of its wealth to poorer school districts.

That upcoming payment is one reason HISD is so intent on fighting for lower values now, Moore said.

We've been over this ground before, so I won't belabor it. Given that HISD will be collecting local revenues based on $97.6 billion worth of appraisals, it's certainly better that they get state funding based on that same amount, so as far as that goes, I'm glad the Comptroller conceded. But I still think they're right on the larger question. If we're going to have a school finance system based in such large part on local property taxes, we should make sure we're appraising everything at an appropriate amount to ensure that everyone is paying a fair share.

Posted by Charles Kuffner on August 09, 2008 to Budget ballyhoo