HARLINGEN — After June Ramirez paid her property taxes and insurance, she was “cash broke.”
That was in March, when federal guidelines and state and local orders forced her to shut down Antique and Artisans Emporium to help prevent the spread of the coronavirus.
Now, the Cameron County Appraisal District’s reappraisals have boosted two of her buildings’ property values by $20,000 while raising another buildings’ values by $10,000, she said.
Along the four-block Jackson Street business district, property owners and merchants are stunned.
Last year, the appraisal district raised property values there by 43 percent.
This year, the district is proposing boosting values along Jackson Street by about 13 percent.
“During this time, how dare they raise taxes,” Ramirez said. “I paid my taxes, paid my insurance and by the time March came along I didn’t have any money. It put me totally cash broke.”
After Gov. Greg Abbott began allowing the state’s businesses to reopen earlier this month, Ramirez opened the shop that’s helped make the business district an antiques mecca.
“We’re getting very little in sales but it keeps us coming in every day,” she said.
But closed storefronts line much of Jackson Street, where many merchants are waiting to reopen their businesses amid fear of the COVID-19 virus.
Down the street, shops like AB’s Fine Things and Flowers by Jesse have already gone out of business.
“I don’t see a lot of people coming back to their businesses again,” Ramirez said. “Look at the big stores — Macy’s and JC Penney — if they’re going bankrupt, what about the mom and pop stores?”
This year, the appraisal district is raising values on Jackson Street properties housing businesses that remain shut down as a result of the coronavirus crisis, said Bill DeBrooke, the owner of several buildings who spearheaded the downtown area’s revitalization program about 30 years ago.
“Some businesses have closed because of the virus. Some of the stores haven’t reopened yet. It backs into being a little afraid and wait-and-see,” he said. “I’ve lost tenants. We’ve got tenants who can’t pay rent and property owners not getting any rent. I have tenants who haven’t paid me a nickel since February. What do you do — push people out on the street? You can’t do that.”
In Washington, D.C., U.S. Rep. Vicente Gonzalez, D-McAllen, and other congressmen called on Abbott “to suspend any raises, interest and penalties on Texas property taxes for the current taxable year.”
“Texans are facing an unprecedented crisis due to the coronavirus,” Gonzalez stated in a press release May 13. “We implore Gov. Abbott to offer hardworking Texans a financial reprieve during this once-in-a-lifetime pandemic.”
On May 19, Abbott requested local governments hold off on property tax hikes.
“Property owners shouldn’t be saddled with rising property taxes while dealing with a pandemic,” Abbott stated in a press release. “As a result, local governments, who set property tax rates, should find ways to reduce the tax burden on Texans.”
Appraisal district’s side
At the Cameron County Appraisal District, Chief Appraiser Richard Molina said state officials didn’t request the state’s appraisal districts hold off on their annual property reappraisals.
“A lot of us — appraisal districts across the state — were relying on the governor or any legislative action that we can’t raise values,” Molina said. “We have been very concerned, trust me. Our concern was what to do. We have a guideline for reappraisals. Nothing told us not to do what we’re supposed to do.”
So Molina decided to go ahead with the reappraisal process.
“It doesn’t mean I’m unsympathetic,” he said. “I’ve got 42 taxing jurisdictions. They could question why didn’t I do the job they hired me to do. We understand we’re in this pandemic but at the same time, our board of directors cannot tell us not to do it. It’s against the tax code regulations.”
This year, the appraisal district focused on the Brownsville area, from Alton Gloor to the Boca Chica area along with commercial property across the county, Molina said.
“Every year, values change because of new construction,” he said. “If there’s new property, it’s going to show an increase in value and every year there’s new properties.”
In Harlingen, the appraisal district is also proposing boosting values along Jackson Street by about 13 percent, DeBrooke said.
This year, he said, the district doubled property values on three of his buildings.
“From a property owners’ standpoint, if you raise the value of my property or increase my tax rate, the end result is the same — I still pay higher taxes,” DeBrooke said. “They hit us last year and they keep pushing up values. Property tax has become the largest single business expenditure that I have.”
Now, property owners might have to boost rents to help pay their taxes — and that might drive more merchants out of business.
“It’s going to drive out a bunch of the smaller businesses as rents have to keep rising to stay abreast of taxes,” DeBrooke said.
Taxes threaten business
At Coun-Tree Woods, rising taxes are driving Michael Howland out of business — after about 32 years.
For years, his building was appraised at about $120,000.
Then last year, the appraisal district raised his building’s value to $189,000.
“With that big jump last year, you’d think they’d be content,” Howland said.
Now, the district’s proposing to boost his values by $30,000, he said, referring to the building in which he handcrafts solid wood furniture on the first floor and lives with his wife in the home they made on the second floor.
“They’re hitting us hard. They’re strangling it,” Howland said, referring to the appraisal district. “This is when everyone’s backing off because of the coronavirus. They seem to have no mercy, especially downtown.”
Since last year, taxes have been driving him to close his shop.
“Some times you don’t have a choice — some times you’re forced,” Howland said. “We’re looking at time to wind down. We haven’t set a date yet.”