COMMISSIONERS' COURT AGENDA REOUEST PLEASE FURNISH ONE ORIGINAL AND NINE COPIES OF THIS MADE BY: Pat Tinley OFFICE: County MEETING DATE: August 22, 2005 TIME PREFERRED: SUBJECT: Consider and discuss approval of Kerr Central Appraisal District Budget. EXECUTIVE SESSION REQUESTED: (PLEASE STATE REASON) NAME OF PERSON ADDRESSING THE COURT: County Judge ESTIMATED LENGTH OF PRESENTATION: IF PERSONNEL MATTER -NAME OF EMPLOYEE: Time for submitting this request for Court to assure that the matter is posted in accordance with Title 5, Chapter 551 and 552, Government Code, is as follows: Meeting scheduled for Mondays: THIS REQUEST RECEIVED BY: THIS REQUEST RECEIVED ON: 5:00 P.M. previous Tuesday. All Agenda Requests will be screened by the County Judge's Office to determine if adequate information has been prepared for the Court's formal consideration and action at time of Court Meetings. Your cooperation will be appreciated and contribute towazds you request being addressed at the earliest opportunity. See Agenda Request Rules Adopted by Commissioners' Court. KERR CENTRAL APPRAISAL DISTRICT P. O BOX 294387 / 1836 JUNCTION WIGHWAY , ~+ f,< ` i , ~~ KERRVILLE, TEXAS 78029-4387 ~, ~ ~~{`~~ ~, ~~~ `~ July 11, 2005 Taxing Entities served by Kerr Central Appraisal District Re: 2006 Proposed Budget Dear Taxing Entities: The Board of Directors has prepared the Kerr Central Appraisal District's operating budget for 2006. A copy of the 2006 Budget is included. The Boarc1 has set August 11, 2005 at 9:15 am for the public hearing to consider the budget. tf the budget is approved at the public hearing the budget will take effect immediately for the 2006 tax year unless vetoed or disapproved by the governing bodies of the county, school districts, cities and towns served by the appraisal district. A majority of the voting taxing units must pass resolutions vetoing or disapproving the adopted budget within 30 days after the date the budget is adopted. A copy of the process taken from the Appraisal District Director's Manual is enclosed. If you have any questions concerning the 2006 Proposed Budget please feel free to contact me, or your representative on the Appraisal District Board of Directors. If you need preliminary values in order to assist you in preparing your own operating budget please get in touch with me or my Deputy Chief, Sharon Capeheart. Tl~i iyou, ~ P. H. "Fourth" Coates, IV Chief Appraiser 830-895-5223 FAX 830-895-5227 Email kcadCa)ktc.com Web Site www.kerrcad.org 2006 Proposed Budget Kerr Central Appraisal District P.O. Box 294387 1836 Junction Highway Kerrville, TX 78029-1885 (830)895-5223 BOARD MEMBERS Kirk Griffin, Chairman David Dozier, Uce Chair Stanley Beard Charles Lewis Phillip Stacey Paula Rector, CTAC P. H. Coates, IV Chief Appraiser Sharon E. Capeheart Deputy Chief 2006 Proposed Budget 06/30/05 2 Expenditures Per Line ftem Comparison Line Ib~m 2005 ~,Q¢ riff %Diff 5006 Salaries $34?,~0 $366,232 $'23,642 7% 5010 Emplpyer Pbr6an d Retirement $24,331 $29,649 $5,318 22% 5012 MBCicdle Ireuratoe $4,968 $6,310 $342 7% 5015 Employee lukdicel Insuartoe $60,113 $60,794 $681 1% 5016 Teas Er~ploym~ertt Comri~ssion $693 $693 $0 0% 5030 Review Board $10,500 $10,500 $0 Ook 5034 DebtServtce-Vehides $16,200 $16,116 X85 -1% 50e35 Travel and tJNegge $10,100 $11,000 $900 9% 5040 Amrx~al Audit $3,750 $6,000 $1,250 333% 5045 ~PP~R9 F~ense $3,000 $3,000 $0 0% 5055 Debt Service- Buildrcg $21,240 $21,240 $0 0% 5060 Deed Cops $2,000 $2,000 $0 0°h 5070 LE,aSed IYIUlpmlent $3,000 $3,150 $250 8% 5075 TelepFane $6,900 $6,900 $0 0% 5080 Utilities $7,360 $7,360 $0 0% 5085 C~1 cxlrxis arld BUildu~g Nfainhenarloe $6,474 $6,474 $0 0% 5090 Consultant-Appraisal $16,700 $16,700 $0 0°!0 5100 Consultant. Legal &LawSuit Res. $18,000 $12,000 X6,000 33°k 5106 LiatxligdVl~brlcers Compensation ~,620 $6,800 $180 3% 5110 Pubf~g~licaBons $3,600 $3,500 $0 0% 5120 SchodslErrployee Education $6,660 $6,660 $0 0% 5130 Pb6`ta Cie $16,500 $12,SOU $4,000 -24% 5135 Rintirg $8,576 $8,576 $0 0% 5136 Htofes3ion21 Dues $1,950 $2,150 $'200 10% 5140 Office Supplies $5,000 $5,000 $0 0% 5145 Furrrlue arxl Fahres $2,500 $2,500 $0 0% 5150 Board of Directors $200 $100 $0 0% 5156 tvfa~tt. and Reserve $A,500 $4,500 $0 0% 5170 Bl~rg Reserve $3,500 $3,500 $0 0% 5180 Corrpr#er Systern $30,163 $30,203 ~'i0 0% 5185 Debt Service -Appraisal System $0 $10,000 $10,000 New 51200 Banldrg Fees $110 $120 $0 0% T~i'AL TOTALS $646,578 $678,306 $;i'L,72$ 5% 2006 Proposed Budget 06/30/05 3 5006 Salaries: Positions 2005 COLA Merit 2006 Total 1. Chief Appraiser $59,821 0.027 0 $61,436 0.02 2. Deputy Chief $38,593 0.027 0 $39,635 0.02 3. Senior Appraiser $37,503 0.027 0 $38,516 0.027 4. Commercial App. $28,923 0.027 0 $29,704 0.027 5. Field Appraiser III $26,529 0.027 0 $27,245 0.027 6. Field Appraiser III $26,583 0.027 0 $27,301 0.027 7. Field Appraiser II $23,625 0.027 0 $24,263 0.027 8. Abstractor $24,228 0.027 0 $24,882 0.027 9. GIS Manager $35,297 0.027 0 $36,250 0.02 10. Exemption Specialist II $21,816 0.027 0 $22,405 O.o27 11. Exemption Specialist I $19,080 0.027 0 $19,595 0.027 Allocated Merit Raises $592 $15,000 TOTALS $342,590 $366,232 0.07 A survey of appraisal districts salary schedules comparable to KCAD was conducted. The proposed 20061ine ifem for salaries is an actual increase of $23,642 or a 7% total increase over the 2005 Gne item. A 2.7% COLA was given to each employee. There are a total of 11 staff members for 2006. Now, more than ever it is imperative that Kerr CAD remain competitive in the job market in order to retain trained gealiry personnel. We continue to have attempts by neighboring appraisal district to hire the employees we have trained at a considerable cost to the district. The total salary line item for 2006 is $366,232. 5010 - EmAlovers Retirement: KCAD has an independent employee retirement plan through Plan Data. All employees are required to participate in this plan. The Kerr CAD Board of Directors has elected to fund 8% of the employee's salary for their retirement plan. Details of this line item are as follows: Total 2006 Proposed Salaries $ 366,232 KCAD Matching Percentage $ X 0,08 KCAD Contribution $ 29,299 Administration Fee $ + 50 TOTAL E 29,649 2006 Proposed Budget 06/30/05 4 5012 - Emplo eJ(_r Medicare: KCAD is responsible for the Medicare tax on each of the employee's wages. This rate is equal to 1.45 percent of the first $125,000 paid to each employee per year. Details of this item are as follows: Total 2006 Proposed Salaries $ 366,232 Medicare Rate x 0.0145 TOTAL S 5,310 5015 - Em,~lovee Medical prance: Kerr CAD provides health insurance to its empbyees through the Texas Association of Counties. The carrier for Texas Association of Counties is Blue Cross 1 Blue Shield. Per employee payments for 2005 are $409.39 per month. Recent conversations with Texas Association of Counties are anticipating an f 1% th 14% increase for 2006. They do not determine the actual premiums until October or early November therefore we must estimate the increase based on their recommendation at this time. Using a midpoint of 12'/: % will increase the 2006 medical insurance payment fo $460.56 per month per employee which is an actua! increase of only $5.16 per month due to an anticipated higher increase that did not occur in 2005. Details of this expenditure follow: KCAD Confibutan Per Month $460.56 Number of Employees x 11 Total Monthly Contribution $5,066.16 Number of Months x 12 TOTAL $g0,7g4 5016 -Texas Emnlovment Comm, sl~ion: KCAD is responsible for the payment of each employee's unemployment tax through the Texas Workforce Commission. This tax is a percentage of the first $9,000 of the employee's quarterfy salary. These rates change annually and are based on the number of employee's hired and fired during the previous year. The payment is 5693 the game as last year's payment. 5030 -Appraisal Review Board: KCAD is responsible for the Appraisal Review Board stipend. The reimbursement covers the ARB member's time, travel, and other relathd costs to serving on this board. The amount requested remains at 510,500 the same as the 2005 amount. Reimbursement per Member $2,000 Number of Members x 5 TOTAL $10,000 Education + p TOTAL 510,500 2008 Proposed Budget O6/30/05 5034 -Debt Service Vehicles: Kerr CAD is responsible for and required by law to physically inspect properties located within Kerr County. In June of 2004, the lease purchase ended and the CAD replaced the four vehicles. The CAD used The Texas Building and Procurement Commission who is authorized to provide purchasing services for local governments pursuant to Title 8 Subtitle C Chapter 271, Subchapter D sections 271.082 and 271.083 of the Local Government Code. This line item covers the vehicle payments for four vehicles. The vehicle payments are $16,115.04 or $1,342.92 per month for 2006. This is a decrease of $84.96 over 2005. 5035 -Travel and Mileage: Fuel costs for the first six months of 2005 are averaging almost $400 per month. The heaviestdriving period for the CAD is the fall and winter months during our appraisal period. Fuel cost soared to record highs during 2004 and the first half of 2005 and at this time are again going up. This line item also includes maintenance and tires. This item has been adjusted upward to 6000 for 2005. This item also includes other travel expense and also pertains to meals and hotel expense when employees are sent #o school. Atypical five day stay in a hotel, including meals in Austin is approximately $600 along with continuing education expenditures. This expense for 2006 is expected to be 5 000. The total for this item for 2005 is $11,000. 5040 -Annual Audit: Section 6.063 of the Property Tax Code requires that the district have an annual audit by a Certified Publ'~c Accountant. The accounting firm estimates the audit for 2005 that will be done in 2006 will cost $5,000. 5045 -Mapping Expense: The district has made parcel mapping a priority, having mapped the district's roads, abstracts, subdivisions, school district boundaries, and approximately 98% of the ownership parcels in the county. This dramatic progress has taken place over previous years utilizing very conservative expenditures. The line item will remain $3,1100 for 2006. 5055 -Debt Service -Building: The CAD building is owned by Kerr Central Appraisal District. The monthly payments are $1,769.98 per month for a yearly total of $21,239.76 for a budget line item of $21,240 for 2006. 5060 • Deed Copies: In order to maintain correct property ownership, KCAD is required to purchase copies of real property deeds from the Kerr County Clerk. This item is $2,000 for 2006. 5070 -Leased Equipment: The CAD leases a copy machine and a postage machine. The amount requested is $3,250. 5075-Telephone: This item includes basic telephone equipment lease and service, long distance service, cellular telephone service, and Internet subscription. This item is $6,900 for 2006. 2006 Proposed Budget 06!30/05 6 5080 -Utilities: The Districts utility expense covers city water and electricity. Anticipated water costs are $150 per year. Electricity costs are running approximately $600 per month. The amount requested for 2006 is 57,350. 5085 -Building and Grounds Maintenance: Building and grounds maintenance includes trash pickup, building cleaning, lawn care, and pest control. The details of this maintenance is as follows: Expense (Month ear Trash Pickup $74 $ 888 Building Cleaning $150 $1,800 Outside Maintenance $198 $2,376 Pest Control $25 $ 300 Termite Inspection 110 TOTAL $ 5,474 5090 -Consultant-Aapraisal KCAD contracts out the appraisals on utilities, minerals, pipelines, and indus#rial properties to the industrial appraisal firm, Capitol Appraisal with a cost of $13,700 for 2006. Also, consultants are used in order to establish values on out of the ordinary or unique properties. The anticipated cost for this service is estimated at $3,000 for 2006. The 2006 amount is $16,700. 5100 -Consultant -Legal KCAD maintains a contractwith the law office of Peter Low. Peter Low charges $150 per hourtor litigation and $125 for non-litigation fees. In the event Kerr CAD has to litigate, this line item could go up signficantly. Currently we have lawsuits on two commercial properties that have the potential to incur litigation expenses as well as expert witness consultation expenses. This line item for 2006 will be 518,000. 5105 • Liability and Workers Compensation: This line item covers workers compensation, general liability, automotive liability, errors and omissions, and real and personal property insurance. This insurance is through the Texas Municipal League IntergovemmentalRlsk Pool (TML). TML has nofified the district of an anticipated small increase for Workers Compensation for 2006. This line item will be $5,800 for 2006. 5110 -Publishing and Publications: This line item includes required newspaper advertisements, property asset listings, and appraisal guides. This line item has a total of 53,500. 5120 -Schools and Empbvee Education: According to Section 5.04, of the Property Tax Code, an appraisal district shall reimburse an employee for all actual and necessary expenses, tuition, other fees and costs of materials incurred in attending, with the chief appraisers approval, a course or training program conducted or approved by the Board of Tax Professional Examiners. This item is a total of 56,550 the same as last year. 2006 Proposed Budget 08/30/06 5130 - Postage: In 1999, Kerr CAD began using an outside mailing firm to print and mall the required appraisal notices. This saves the district some postage. The amount requested for 2006 is $16,500. 5135 - Pr)nting: This line item includes expenses such as printing of Notices of Appraised Value, Appraisal Cards, Appraisal Rolls and envelopes. This item for 2006 is estimated at 58,576. 5136- Dues: This line item is devoted to the registration of the district and employees with different state agencies and trade organizations. Registration with the Board of Tax Professional Examiners is a requirement by taw. Affiliation with the Texas Association of Appraisal Districts allows KCAD to enroll in state classes for reduced tu'fion and keeps the district informed of changing rotes and laws. The Texas Association of Appraisal District dues will increase by $200 for 2006. A detailed description of this line item follows: Board of Tax Professional Examiners $ 680 Texas Association of Appraisal Districts $ 900 International Association of Assessing Officers $ 155 Texas Association of Assessing Officers $ 80 M.l. S. Membership $ 300 Asa Charge Membership $~5 tOTAL $2,150 5140 -Office Supppes: This line item includes all miscellaneous office supplies used in the district. These items include paper, writing utensils, film, toner cartridges, and other supplies. The amount requested for 2006 is $5,000. 5145 • Furniture and Fixtures: New furniture purchases have been kept to a minimum. Because of this, some office furniture such as desk chairs are in need of replacement, the amount requested for this line item is 52,500 for 2006. 5150 - Soard of Directors: This line item is utilized to purchase director manual and reference material for the Board of Directors, A portion of this line item is also ulNized to purchase awards of appreciation to outgoing board members and name plaques. The line item remains at $200. 5155 -Equipment Allaintenanc~ This item includes the maintenance of PC computers, networks, postage machine and copy machines. For 2006 Kerr CAD is designating $0.,500 of its self-generated income from property record card sales, computer generated lists, map sales, and bank interest towards this line item. Therefore, $4,500 will be deducted from the Cash Allocated Budget allocated to the entities. This line amount remains the same at 54,500. 2008 Proposed Budget 08/30/05 5170 - Buifdinr~ Reserve: A building reserve of $3,500 per year was established when KCAD purchased the current building. This fund is reserved and cannot be utilized for any purpose other than replacement or repair to major items regarding our facilities. Last year the building reserve was reduced to $500 but will return the original amount of 53,500 per year due to anticipated roof replacement and parking lot resurfacing and renovation of the CAD office. $i80la) - Cromauter lease -The Software Groua: This line item is for the district computer system. This system is the lifeblood of the district. Every property account is recorded, updated, and appraised through this system. The line item for this amount will be increased by $50 due to an increase by the software provider. This line item will be 530,203 for 2006. 5200 - Bankinr~ Fees: We are now being assessed service charges on our bank account. This item for 2006 is 5720. 2006 Proposed Budget 06/3D/05 ALLOCATION °~,rLeYY Eat'~20 9 on Frgeze Total Est L.evY E~T~~ $158,8 fl.311% Est lJavy Sax 13.395% $~,g35 1 20pa flats $6,845,0 $913 ~ 2004 CertTax $158,855 0,136% Entity ~}g,014,199 $4.3232 ~g45,030 $69'478 0.038% $255 ~, ram $1,215,381,763 $0.0215 $88479 $19'970 17.293°10 8116,1 y GitY of 1ng $0. $19,879 $8,836, 1 $323,156,296 0.005°i0 $~ ` GitY of Kerrvrlle p 0350 $2,690 $114 f)'tst. #1 $55,36fl,057 $ ' 12 $8,$36.970 0.017% Kerr emer9' Dist. #2 7 620 $0.34 $2,890 $8,971 ° $10,360 Kerr Emerg~ 82,589. 1500 1.543 /0 $~ ~ $1,793,035 $4. $8,971 $788,687 0.005% Kerr County p~trict p 1500 $2,395 881 Ingram Hat Road $5'~~ 152 $pA30'3 $788,693 $6,070 O.D12°!0 Dlstf+ct $2,395 $2,476 0.005°h $~ Kerrville South Road $2,552, 0.1500 $6,070 $302 81,596,544 $ 1500 $23,218 0.045°h Lateral Roads District $4,048,804 ~• $2,478 3.r~7o10 $23,949 pakridgaRoad $1,650,820 $0.1500 $23216 $1,822,853 0.758°10 85,076 •~ ®rhilltf3all Road District 8200,289 Summ Rd 4ist 82,868,465 $0.8700 $1,622,564 $388,353 5.219x10 $35,041 Spring Creek Ranch 324 $1.5400 $10,5 82,6,866 464 Lake In9~' Estates Rd Dist 8105,381, $1.1800 $375,388 $271,015 8.112°~ $~, $31,812,530 $2,395,851 $4,145,883 $319,280 Center PointlSD $14800 $558,395 X4,301,143 47.554% $161,881,844 $3,587,A88 1.495010 $10,037 pividelSD $1.5786 $3,791,071 $764,008 $3,303 ~ HuntISD $227,257,578 16830 820,510,072 $251,226 0.492% , Ingram 15D $1,218,~1,A59 8 ~ 8764,8 100°k $6'71,4 $0.0295 $251,226 $51,102,560 78,306 Kerrville 1SD River Author+hr $2,589,856,0 0097 UVPerGuadalupe $2,589,955,756 ~• $2,400 Headwaters Groundwater $4,500 TOTAL 1=STINIATFA LEVY ~' 940 2006 Budget er lease $871'406 Lass.•1'tERV1KRVlTcw i mentNlaintenance ~ i 5155 EQ~ n to Entities ~ ~yrglta8an88t1mated~' ~ Bud9~ Reductio 'Tt1is ~+ ENTfTY PQ#tTtON OF BUDGET tOtalusedfOr ui the20468udgnceandup9 KRVLtower located an the Kerr CA•D• ~° ~ .~ anerst~g achvities which i ~~n ~~ receives 1 ~ ccpcome from the KKR ~cipa Kerr C.A.D. ies, maps, CDs and other ikon fo an ~ti~'t~ total of S6>~ generated ftom sales 2006 Kerr C.A.D. Bud~• -tne item 5155 iseabtracted $ frties ~ S6~ 4t)6 for the esfarthe ~r3oro5 allocation PurP08 2006 propo~ fsud9~ District Financial Affairs V. Appraisal District Financial Affairs articipating taxing units pay for all appraisal district poperations.The appraisal district directors' financial responsibilities include adopting an annual operat- ing budget, selecting a district depository, engaging in competitive bidding procedures, contracting, purchasing, setting accounting methods and auditing. Annual Operating Budget Before June 15 of each year, the chief appraiser sub- mits to the board a proposed budget for the upcoming fis- cal year.The district's fiscal year is the calendar year, unless changed under Property Tax Code Section 6.06(i). The chief appraiser's proposed budget must list each proposed position in the district, the position's proposed salary and benefits. The budget must also include each proposed capital expenditure and an estimate of the amount of the budget allocated to each taxing unit partic- ipating in the district. This allocation is only an estimate, since final levy figures for the year will not be known until late fall. Other items commonly included in the budget are: • reimbursement for reasonable and necessary appraisal district director expenses; • per diem or actual expense reimbursement for appraisal review board members; Directors should remember that taxing units pay the cost of appraisal district operations. Each unit may have its own budget limited by the voters through the tax rate roll- backelection process. Collection or assessment services are a separate budg- etfrom the main appraisal district budget.Only units using these services pay for them, so the chief appraiser should budget separately for these services. This separation per- mits allocating costs to the responsible taxing units. Public Hearing and~Publication of Budget The board of directors must hold a public hearing to consider the budget. This hearing gives taxing units and the public an opportunity to observe and comment on how funds are being spent. The law does not require the board to hold the hearing on a specific date, but the budget must be finally approved before September 15.The September 1 S date permits tax- ing units participating in the district to include their share of appraisal district cost in their own budgets. If the fiscal year has been changed, the chief appraiser must prepare a proposed budget before the 15th day of the seventh month preceding the first day of the fiscal year established by the change. The board of directors must adopt a budget for the fiscal year before the 15th day of the fourth month preceding the first day of the fiscal year compensation for attorneys hired for the appraisal established by the change. district, appraisal review board or both; Before the board holds the budget hearing, the board's secretary must deliver to the presiding officer of reimbursement of appraisal office staff for reason- the governing body of each taxing unit in the district writ- ableand necessary expenses; ten notice of the date, time and place of the hearing.The payment of tuition and fees incurred for courses or secretary must deliver this notice no later than the 10th educational programs; da before the date of the budget hearing. funds for appraisal review board proceedings and Not later than 10 days before the public hearing date, the chief appraiser must publish a notice of the hearing in operations; and the newspaper.Thenne-quarter page notice must be pub- otheritemsnecessaryforappraisaldistrictoperations. lished in a newspaper or tabloid of general circulation in During budget preparations, the chief appraiser should identify each appraisal district service or activity. The board of directors should review each identified activ- ity to determine the current level of service provided and whether that level is adequate. Through this review process, the chief appraiser should develop a clear, logical plan for allocation of funds. The chief appraiser should explain to the board the budget's plan of operation and outline the basis for each funding request. The chief appraiser should identify any need for major changes in appraisal district services and identify the impact of changes on the cost of operations. the appraisal distnct s county.The noUCe may not be pub- lished in the part of the paper in which legal notices and classified advertisements appear. Comptroller Rule 9.3048 sets out the content of the notice. The notice must state where and when the public hearing will be held, the total amount of the proposed budget, the amount the proposed budget is increased from the current year and the number of employees to be compensated from the budget.The notice must also state the name, address and telephone number of the appraisal district and, at the chief appraiser's option, a statement explaining any significant differences between the current Appraisal District Director's Manual Page 27 Appraisal District Financial Affairs and the proposed budgets.The notice must also state that the appraisal district is supported solely by payments from taxing units in the appraisal district. in addition, the notice must contain the following statement: "If approved by the appraisal district board of direc- tors at the public hearing, this proposed budget will take effect automatically unless disapproved by the governing bodies of the county, school districts, cities and towns served by the appraisal district. A copy of the proposed budget is available for public inspection in the office of each of those governing bodies." The rule and notice form appear in Appendix E. Under the Open Meetings Act, the district also must post notice of the budget hearing 72 hours in advance. Voting taxing units may veto the approved budget.To veto, a majority of the voting taxing units must pass reso- lutions disapproving the adopted budget. These units must file resolutions with the board's secretary within 30 days after the date the budget is adopted. If enough veto resolutions are filed, the budget does not take effect. The board must adopt a new budget within 30 days of disap- proval. Whether a new budget publication is required before the hearing to adopt a new budget is unclear. The most conservative approach is to publish notice of the new budget and hearing. The board of directors may amend the approved budget if the board's secretary delivers to the presiding officer of each taxing unit's governing body a written copy of the amendment proposal. The secretary must deliver this notice at least 30 days before the date the board intends to act on the amendment. Voting taxing units may disapprove a budget amend- ment under the general authority given to taxing units to disapprove a board action. Voting taxing units must file disapproval resolutions with the board's secretary by majority of the voting taxing units within IS days of the amendment's adoption. Each taxing unit must pay its'share of the budget in four equal installments, due at the end of each calendar quarter (December 31, March 31, June 30 and September 30).The first payment is due before January I of the year in which the budget takes effect. A taxing unit's governing body and the chief appraiser, however, may agree on a dif- ferent method of payment. If a taxing unit does not pay on time, the payment becomes delinquent and incurs a penalty of 5 percent of the payment amount. interest accrues at an annual rate of 10 percent. The attorney general in Opinion No. JM-74 (1983) ruled that the appraisal district has no authority to waive or rescind the penalty and interest imposed on a delinquent taxing unit. If the budget is amended any change in the amount of a unit's cost allocation is apportioned among the pay- ments remaining. Allocating an Appraisal District's Costs Each participating taxing unit pays a share of the appraisal district budget. Section 6.06(d) specifies how to determine each unit's share. The formula for calculating a taxing unit's share of the budget is: Unit's Tax Levy = Unit's Share Total Tax Levy of All Units The chief appraiser calculates the unit's share by divid- ing the current taxes levied by the unit on property in the appraisal district by the current total taxes levied by all tax- ingunits on property in the district.The resulting fraction is multiplied by the total dollar amount of the budget.Only the taxes imposed by a unit on property in an appraisal dis- trict are used to calculate the unit's allocation in that dis- trict. Section 6.06(d) provides a limitation for a taxing unit that has very few parcels of property but has a large tax levy.lf the unit has less than 5 percent of the total number of parcels in the district, but imposes more than 25 percent of the taxes in the district, the unit's allocation may not exceed three times its percentage of parcels. For example, a taxing unit has 4 percent of the parcels but imposes 30 percent of the taxes.lts normal budget share would be 30 percent, but under this rule, the share may not exceed 3 times 4 percent, or 12 percent. One further point about budget allocation concerns a taxing unit with territory located in more than one county. If the taxing unit chooses to participate in only one appraisal district, all costs of appraisal district operations in the territory outside county boundaries are allocated to the taxing unit that chooses to add that territory to the dis- trict. PropertyTax Code Section 6.02(f) provides that if two or more units add the same territory to the district, costs of operating in the added territory are allocated based on the proportion of taxes imposed by each unit to the total taxes imposed by all units in that territory. Finally, a school district may have annexed property from another school district in another county for state funding purposes.The school district pays to each apprais- al district in which it has territory, based on the amount of taxes levied on the property in that territory. Changing the Allocation Method Either the board or the participating units may change the Section 6.06 allocation method. Page 28 Appraisal District Director's Manual