With their building’s assessed value about to double soon, Michael and Barbara Howland are facing an annual $2,000 tax hike that might drive them out of business after three decades.
They’re not alone.
Yesterday, sweeping appraised values increases along with big potential tax and rent hikes were the buzz along Jackson Street.
On Sunday, the Cameron County Appraisal District released its preliminary appraised values showing average increases of about 47 percent along the Jackson Street business district.
Overall, appraisal property values jumped from $5.18 million to $7.62 million, marking an increase of $2.4 million along the five-block area.
“I’m going to be paying more in rent,” Peggy Allen, owner of House of Frames said, after the building she rents at 212 W. Jackson jumped in assessed value from $53,311 to $76,847.
Along Jackson Street, many property owners and merchants fear a tax hike would lead to raised rents, forcing some shops out of business and leaving buildings empty.
At Coun-Tree Woods, Howland said the increases in appraised value could trigger the biggest tax increases since he and wife opened their furniture shop 31 years ago.
“This is the straw that broke the camel’s back,” Howland said yesterday at Coun-Tree Woods, the shop where he’s built solid wood furniture for 31 years.
The appraisal district is proposing increasing the value of the building at 106 W. Jackson St. from $97,199 to $162,475.
Howland said he expects the value increase to boost his taxes from about $3,000 to $5,000 per year.
“Right now it’s enough to pay overhead. It doesn’t leave anything extra,” Howland said. “When you double somebody’s taxes, that’s a lot. Most of these businesses are mom and pop — you’re on a shoe-string.”
Ready for hearings
At the appraisal district, Chief Appraiser Richard Molina is preparing to face property owners protesting the new values.
“We have to work for them,” Molina said yesterday.
Property owners can request informal hearing with appraisers through May 15.
From May 15 to mid July, property owners can request formal hearings with or in front of the appraisal review board.
Along Jackson Street, he said, property owners can bring rental contracts to contest their values.
“We’re here to listen to them to determine where the values should be,” Molina said.
The property values are lower than the ones property owner Bill DeBrooke found last month on the appraisal district’s website.
“You can look at it any way you want,” DeBrooke, who owns several downtown buildings, said. “But it’s still a really big hit.”
According to DeBrooke, the earlier numbers showed average increases of about 70 percent, while some properties doubled in value.
Under those numbers which were proposed last month, assessments would have jumped to a total of $7.25 million, marking a $2.95 million increase.
Soon after DeBrooke found the proposed increases, the district removed the proposed values because they had been inadvertently posted.
“Some dropped, some stayed the same,” Molina said yesterday.
Below market value
For years, he said, Jackson Street’s five-block business district was undervalued.
However, rental information and a few recent sales helped the district re-appraise the stretch, Molina said.
“The values are changing every day,” he said. “We’re working putting in rental and sales information.”
City Hall’s take
At City Hall, City Commissioner Tudor Uhlhorn requested officials search for ways to help Jackson Street’s property owners.
“That’s quite a big increase,” Uhlhorn, the District 2 commissioner who oversees the downtown area, said. “We’re exploring things we might be able to do but they’re somewhat limited.”
Uhlhorn described Jackson Street as the downtown anchor where property owners have worked for 30 years to turn into a vibrant business district that’s become a draw for out-of-town shoppers.
“That’s one of the shining stars of Harlingen,” he said. “When you fill it up and get it to where you want after all these years, the appraisals go up. I know it’s a shock for the businesses there. Any (tax) increase is an impact.”
While City Hall may not be able to much, the property owners are going to do as much as they can.
Like many Jackson Street property owners, Lars Keim said he will protest.
“I really don’t have a choice,” Keim, who owns two buildings, including one that’s home to the popular Carlitos Wine House, said yesterday.
“In both cases they doubled,” Keim said. “I don’t know how they arrive at the values. I still have a hard time trying to understand how something I purchased four years ago has doubled in value, according to them.”
Down the street, Steve Aune is planning his second protest in about eight years.
At 214 E. Jackson, his values jumped from $105,971 to $145,714.
“I’m upset,” Aune said as he sat in his shop at Nip’ n Tuck Draperies.
Years ago, he said, he bought the 35,000-square-foot building for about $40,000.
After the $80,000 renovation of his upstairs loft, he moved out of his 2,000-square-foot custom-built home in Treasure Hills.
“It was worth every penny,” he said of the sprawling loft.
About eight years ago, he protested after his building’s value jumped from $40,000 to $225,000, he said.
At that time, he filed for homestead exemption.
Now he’s ready to protest again.
“I’ll protest because you’re a fool if you don’t,” he said. “Business owners — all we do is pay taxes.”