$12 million in tax refunds is not a crisis

Tarrant County officials, led by Tax Assessor-Collector Ron Wright, have gone into crisis management mode after learning that they must refund $12 million in property tax payments to thousands of local homeowners and businesses.

Not that it’s a crisis to put that money back in the hands of the people it belongs to, but the large outflow of cash must be managed carefully at a time when county coffers are on the low part of their normal ebb and flow.

Wright is determined to do it. As he says, “That’s the people’s money. We legally owe it to them.”

He says he’ll suspend allocations to local taxing entities until the refunds are complete.

That’s not good, because cities, school districts and the county itself need tax revenue to pay their own bills.

But most of them typically have cash reserves and can get by for a short period. New tax bills go out Oct. 1, which should start the income cycle over again.

The real question here is straightforward but difficult to answer: What went wrong?

County officials blame the Tarrant Appraisal District and its software problems that have caused difficulties for months.

Well, that’s a little awkward.

The Tarrant Appraisal District, created under a state law that took effect on Jan. 1, 1980, is governed by a five-member board of directors appointed by the 73 Tarrant County taxing units that it serves.

The current board members were elected by those taxing units in December. Joe Potthoff, a real estate developer and consultant, has been the board’s president for more than 17 years.

Wright himself, because of the office he holds, is a nonvoting TAD board member.

So county officials who are pointing fingers at TAD are really pointing at themselves and the others who appoint the board members.

The county has power to effect changes at TAD if that’s what officials want.

For his part, Chief Appraiser Jeff Law, TAD’s chief administrative officer, says his organization’s software problems are not to blame. He has acknowledged those problems and apologized, but not for the current refund issue.

Law says tax refunds are routine. They come about as property owners settle tax disputes or file for exemptions, which can bring refunds of prior year payments.

The only difference now, Law says, “is the timing of the refunds this year compared to other years.”

When the refunds are made and the dust settles, figuring out what went wrong should be top priority. Wright can lead the way.

This story was originally published August 31, 2016 at 6:18 PM with the headline "$12 million in tax refunds is not a crisis."