Statement of Tom Pauken

Thank you, Governor Perry. It is an honor to have the opportunity to work on an issue that has been a concern of mine and countless other Texas taxpayers for many years - the need for appraisal reform in Texas.

There is an old Texas saying that I often use, "If it ain't broke, don't fix it." I think it is fair to say that our appraisal system in Texas is broken and badly in need of fixing. I look forward to working with Governor Perry, our other task force members and our state legislators in listening to the suggestions and recommendations of people from all across Texas as to how to fix this broken system. We have no pre-conceived conclusions, but hopefully we can come together with a series of recommendations for appraisal reform that can be taken up by our legislators in the next session of the Texas Legislature.

It is sometimes easier to be a critic on the outside rather than being an elected official having to make difficult decisions on important issues affecting our state. Effective governance is finding real solutions to serious problems. That, I submit, is what Governor Perry, the Sharp Tax Commission and the Texas Legislature did earlier this summer with the passage of true school finance reform that included a one-third reduction in school property taxes - the largest property tax cut in Texas history. Hopefully we can accomplish something similar here with true reform of our appraisal system.

As you have said on many occasions, Governor Perry - we need "to address the other side of the equation … property values". I have used the term "stealth tax" to describe the hidden tax paid for by property owners as a result of skyrocketing property valuations. In my home city of Dallas, for example, appraised values are up a whopping 8.4% this year, a greater increase than the growth of the economy or the growth in inflation. In some regions along the Texas coast, the property valuations increases are much greater. And, the problem is not just limited to major population centers. Property owners in rural counties have seen huge jumps in appraised values this year as well. In some cases, families are being forced to sell their homes because of the added burden of higher property valuations.

Your establishment of the Texas Task Force on Appraisal Reform is most timely. And, your comments are particularly appropriate in calling on the Task Force members to come up with recommendations that will "strike a proper balance between protecting taxpayers and ensuring funding for essential services."

As the Nobel Prize winning economist Edward Prescott said about taxation, "the purpose of the tax system is to collect revenues at the least cost to the people."

The members of your task force on Appraisal Reform look forward to listening to the voices of Texans on this important issue - with the goal of submitting a report to you and to the Texas Legislature that offers common sense solutions to an appraisal system badly in need of fixing.