AUSTIN -- Property tax bills have gone out to hundreds of thousands of Travis County homeowners who sometimes have to pinch pennies to pay.
But at the same time, dozens of large, commercial property owners have begun relying on civil district courts to get their valuations lowered – sometimes by millions of dollars. This results in lower tax bills and a loss in money to fund government operations.
In the past three years, government entities such as the City of Austin, Travis County and the Austin Independent School District did not receive an estimated $40 million after property owners filed lawsuits to get their valuations lowered.
That’s enough to pay for the city’s upcoming Trail of Lights for the next four decades. It's also the annual salaries of about 500 firefighters, as well as the cost of building a new performing arts center for Austin ISD.
"Obviously it seems to be the case that people with big bucks and big attorneys can get the better deal than the common house owner does, and it just doesn't feel right," said Don Cooper, who lives in North Austin.
The result of the tax breaks can be a cascade, appraisers warn: As businesses and retailers get their taxes lowered, governments may have to raise the tax rate for everyone else.
"It may redistribute tax burden, because the tax rate gets applied across all properties. So if one becomes less, then others may have to pay a greater proportion of that tax liability," Marya Crigler, chief appraiser for the Travis County Appraisal District, said.
The KVUE Defenders and the Austin American-Statesman analyzed every lawsuit filed against the county since 2010.
Some retailers, like Walgreens, have sued the county every single year – often for every single property they own.
Some major industries such as Samsung and AMD have gotten the biggest breaks. In the past three years, Samsung got a $1.2 billion markdown on their total valuation. That's about $30 million they didn’t have to pay.
AMD got its valuation cut by a combined $164 million. That's about $40 million it didn’t have to cover.
Among retail chains Walgreens got the biggest cut -- $14.8 million from $136 million in valuations. That translates to a tax savings of about $370,000.
Big commercial property owners say appraising their properties is often more difficult than homes and leads to disputes more easily. That's one of the main reasons they sue.
"The business decision though is not that you want to exercise some undue burden on the system,” said Mark Hutcheson, an Austin attorney who represents companies in tax disputes with the county. "The business decision is that you want to make sure your tax obligation is fair and your fair share - but not more than that."
Officials say in the case of Samsung, the county put value on a project that had not yet been completed. They fixed the issue before the case went to trial.
AMD officials say they disputed their tax bill because an independent appraiser told them the county valued it too high. They won that trial.
Walgreens said in a written statement, "We appeal our property taxes when we believe the property assessment significantly exceeds the market value of our properties. Like any individual or business that owns property, we want to ensure the taxes we pay are fairly assessed."