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City Council <br />Meeting Minutes December 3, 2019 <br />appraisal method is utilized. Mass appraisal determines values in where market <br />areas, neighborhoods, subdivisions, and large groupings of similar properties <br />are appraised at the same time. Ms. Raven explained why appraised values <br />change year to year and stated that everyone has the right to protest before the <br />appraisal review board. <br />Council held discussion and asked questions regarding apartment complexes <br />and how they are appraised, market rate study and vacancy rated in San <br />Marcos. Council would like to receive information regarding our current <br />vacancy rate in the City. The appraisal district will get this information sent <br />out. <br />Ms. Raven explained that the appraisal district only values the property and it <br />is the tax rate that controls how much the property owner will pay. <br />Council asked for a report of how many successful protests there have been. <br />Ms. Raven stated she will get this and forward to Council. <br />There was a brief discussion on accessory dwelling units and short term rentals <br />and the affect they may have on their neighbors. If a house is purchased and <br />rented out for higher value will this make the surrounding properties go up in <br />value as well? Ms. Raven explained that these are still valued as homestead <br />property if it is a homestead. If it is not a homestead, it may be an income <br />producing property. She further explained that the highest and best use of a <br />property is typically single family residential. However, in some instances <br />highest and best use of property may be a multi -family or something other <br />than single family. <br />Council thanked Ms. Raven for her presentation and Heather Hurlbert, <br />Finance Director, resumed the presentation regarding the difference with tax <br />ceilings and tax exemptions. She outlined the exemptions we currently have in <br />the City which include 65 or older, disabled veteran, and 100% disabled. Ms. <br />Hurlbert provided a case study assuming a tax ceiling was put in place for tax <br />year 2014 and based on actual tax payer data. The results indicated that <br />average home values increased 7% per year, average value growth increased <br />taxes an average of $53 annually, the 2017 voter approved increase would have <br />required a 1 cent increase to produce the same amount of revenue if ceiling <br />had been in place, and budget would have been reduced by $513,000 if ceiling <br />was in place. <br />Council was asked to consider some options regarding the increase to the over <br />City of San Marcos Page 2 <br />