Tax Exemption Ordinance Update

On Tuesday, July 23, 2019, the Heritage Commission recommended approval of changes to the Heritage Tax Exemption Ordinance.  City Council will consider the changes at its meeting on August 26, 2019.  An update is needed to meet the new March 1 deadline (previously May 1) for providing the city's annual list of tax exempt properties to the Collin Central Appraisal District.  In addition to meeting this deadline, the proposed changes are intended to streamline the approval process, allow inspection results to be distributed earlier, and introduce new appeal and extension options.  

The proposed update includes no changes to the following:

  • the types or classifications of structures that qualify for an exemption
  • the percentage of value exempted
  • inspections or inspection criteria

Benefits of Proposed Updates to Property Owners

  1. The results of the inspection, including any repairs required to maintain eligibility for the following year ('Poor' rated repairs) will be provided earlier in the year (by March 31).  This allows more time to complete repairs.
  2. Staff's determination that any element of the structure is in 'Poor' condition and requires repair can be appealed to the Heritage Commission.  This option is not available under the existing ordinance.
  3. Property owners will now have to opportunities to request an extension of the deadline to complete repairs due to extenuating circumstances (May and December).

Existing Ordinance and Draft Update

Existing v. Proposed Tax Exemption Process

The most significant change to the ordinance is the general procedure by which tax exemptions are approved:  

Existing ProcedureProposed Procedure
1. Application submitted. (by January 1)1. Application submitted. (by January 1)
2. Inspections performed. (early January)2. Inspections performed. (early January)
3. Notification provided to properties recommended for denial at the Heritage Commission. (late January)3. Notification provided to properties deemed ineligible by the Heritage Preservation Officer. (mid-January)
4. Heritage Commission holds a public hearing and makes recommendations to City Council on tax exemptions for the current year and any repairs required to maintain eligibility the following year. (by March 30)4. City Council considers any appeals and approves tax exemptions for the current year. (by February 28 or 29)
5. City Council considers any appeals and approves tax exemptions for the current year. (by May 1)5. Inspection Report provided to the applicant which lists any repairs required and a deadline to complete the repairs to maintain eligibility the following year. (by March 31)
6. Inspection Report provided to the applicant which lists any repairs required by December 31 to maintain eligibility the following year. (late May)6. Heritage Commission holds a public hearing and considers any appeals of the Inspection Report and extension requests. (by May 31)
7. Applicants to complete repairs by December 31.7. Extension Requests considered by the Heritage Commission. (December)
8. Extension Requests considered by the Heritage Commission as part of recommendations to City Council. (late January)8. Applicants to complete repairs by December 31 or other later deadline established by staff/Heritage Commission.