The Comptroller of Public Accounts adopts amendments to §9.804 concerning arbitration of appraisal review board determinations issued for tax year 2017 and previous tax years, without changes to the proposed text as published in the May 25, 2018, issue of the Texas Register (43 TexReg 3324) and will not be republished. The purpose of the amendments to §9.804 is to add new subsection (i) to provide that §9.804 shall govern only arbitrations appealing appraisal review board (ARB) orders issued for the 2017 tax year and previous tax years, to amend the title of the rule, and to provide that §§9.4252(e), 9.4253, 9.4256(b), (c), (f) - (h), 9.4258, 9.4259, and 9.4261(m) of new Subchapter K, titled Arbitration of Appraisal Review Board Determinations, apply where indicated in §9.804. New Subchapter K addresses all matters concerning arbitration, including the arbitrator registry and removal from it. Subchapter K, which was adopted by a separate filing, applies to all arbitrations appealing ARB orders other than those issued for the 2017 tax year and previous tax years. Several sections or subsections of Subchapter K are being adopted for incorporation into §9.804 by these amendments. These provisions require that a copy of the appraisal review board order being appealed be submitted with the request for arbitration; they also address agent representation in arbitration, legislative changes regarding how the comptroller appoints arbitrators, qualifications for inclusion in the comptroller's registry of arbitrations, arbitrator eligibility for a particular appointment, and the grounds upon which an arbitrator is required to dismiss a pending arbitration.

Another purpose for the amendments to §9.804 is to implement legislative changes to Chapter 41A of the Tax Code which the 85th Legislature, 2017, enacted through passage of Senate Bill (SB) 731 and SB 1286, SECTIONS 2 through 4 and 7. Tax Code, Chapter 41A addresses the requirements and procedures for appeal of appraisal review board determinations through binding arbitration.

The legislative amendments to Chapter 41A enacted through SB 731 increase from $3 million to $5 million or less the value of property that qualifies for arbitration and provide for a deposit of $1,550 and a fee of $1,500 for these arbitrations. Additional legislative changes made to Chapter 41A enacted through SB 1286 are implemented in amendments of §9.804 by reference to §9.4256(b), (c), (f), and (g), §9.4258, and §9.4259 of new Subchapter K of this title which make the following changes to the arbitration process: require the comptroller, rather than the parties, to select the arbitrator for appointment; impose a Texas residency requirement to serve as an arbitrator; make appointments first to available arbitrators who reside in the same county where the property is located; render arbitrators who, during the previous five years, have represented others for compensation in any protest or served in certain capacities in the county appraisal district, ineligible for appointment in that same county; and provide that the comptroller may not appoint an arbitrator from the registry for good cause. The comptroller also adopts by reference revised "Request for Binding Arbitration" and "Arbitration Determination and Award" forms to comply with SB 731 and SB 1286.

No comments were received regarding adoption of the amendments.

The amendments are adopted under Tax Code, §41A.13 (Rules), which authorizes the comptroller to adopt rules necessary to implement and administer Chapter 41A of the Tax Code governing the appeal of appraisal review board orders through binding arbitration.

The amendments implement Tax Code, §§41A.01(2), 41A.03(a)(2)(F), 41A.06(b)(2)(F), 41A.07(a)(1) and (2), and 41A.07(e), (f), and (g), and 41A.13.