Court Opinion

ID: 4129257
Source: CourtListenerOpinion
Date Created: 2017-02-18 00:49:36.935358+00
Date Added: 2024-06-11T14:37:36.263246
License: Public Domain

>” OFFICE OF THE ATTORNEY GENERAL . STATE OF TEX.%S

   JOHN    CORNYN

                                           October 19,200l

The Honorable David Sibley                             Opinion No. JC-0424
Chair, Business and Commerce      Committee
Texas State Senate                                     Re: Whether a property owner’s right of
P.O. Box 12068                                         access under section 25.195 of the Tax Code
Austin, Texas 787 1 l-2068                             to information prepared by a private appraisal
                                                       firm and used by the appraisal district to
                                                       establish the taxable appraised        value of
                                                       the owner’s property is limited by section
                                                       25 .O1(c) of the Tax Code, and related questions
                                                       (RQ-0385-JC)

Dear Senator Sibley:

         You ask about a property owner’s right of access under section 25.195 of the Tax Code to
information prepared by a private appraisal firm and used by the appraisal district to establish the
taxable appraised value of the owner’s property. We conclude that under section 25.195(a), a
property owner has a right of access to information about his property prepared by a private appraisal
firm and obtained by the appraisal district from the appraisal firm pursuant to section 25 .O1(c) of the
Tax Code. In addition, section 25.195(c), a provision recently enacted by Senate Bill 1737, gives
a property owner access to information in the possession of a private appraisal firm that may not be
in the possession of the appraisal district. Finally, we conclude that neither section 39.001 of the
Utilities Code nor any other provision enacted in the 1999 legislation deregulating the electric utility
industry affects a property owner’s right of access to appraisal information under section 25.195 of
the Tax Code.

          Before answering your specific questions, we briefly review the statutes governing appraisal
districts’ use of private appraisal firms and property owners’ right of access to appraisal information.
Section 25 .Ol (b) of the Tax Code authorizes an appraisal district to “contract with a private appraisal
firm to perform appraisal services for the district.” TEX.TAXCODEANN. 8 25.01(b) (Vernon 1992).
Subsection (c) provides that such a contract “is invalid if it does not provide that copies of the
appraisal, together with supporting data, must be made available to the appraisal district and such
appraisals and supporting data shall be public records.” Id. 8 25.01(c). It also provides, however,
that the term “supporting data” “shall not be construed to include personal notes, correspondence,
working papers, thought processes, or any other matters of a privileged or proprietary nature.” Id.
The Honorable David Sibley      - Page 2      (JC-0424)

         While section 25 -01 (c) provides that certain information used or created by an appraisal firm
must be made available to the appraisal district and deems that information public, section 25.195
of the Tax Code addresses a property owner’s right of access to information relating to the appraisal
of his or her property. This right of access is separate and apart from the public’s right of access.
Significantly, section 25.195 was substantially amended in the last legislative session in Senate Bill
1737. See Act of May 11,2001,77th         Leg., R.S., ch. 372,200l Tex. Sess. Law Serv. 644. As that
bill became effective on May 26,2001, see id. 8 2, we address section 25.195 as amended.

         Subsections (a) and (b) of section 25.195 address a property owner’s right of access to
information in the possession of the appraisal district while the remaining, wholly new subsections
address a property owner’s right of access to information in the possession of an appraisal firm.
Section 25.195(a) provides as follows:

                         (a) After the chief appraiser has submitted the appraisal
                records to the appraisal review board as provided by Section 25.22(a),
                a property owner or the owner’s designated agent is entitled to inspect
                and copy the appraisal records relating to property of the property
                owner, together with supporting data, schedules, and, except as
                provided by Subsection (b), any other material or information held by
                the chief appraiser or required by Section 25.01 (c) to be provided to
                the appraisal district under a contract for appraisal services,
                including material or information obtained under Section 22.27, that
                is obtained or used in making appraisals for the appraisal records
                relating to that property.

TEX. TAX CODE tj 25.195(a),   as amended by Tex. S.B. 1737, 77th Leg., R.S. (2001) (emphasis
added). Senate Bill 1737 added the italicized language. That bill did not amend subsection (b) of
section 25.195, which provides as follows:

                        (b) The owner of property other than vacant land or real
                property used for residential purposes or the owner’s agent may not
                inspect any material or information obtained under Section 22.27.

TEX. TAX CODE ANN. 6 25.195(b) (Vernon Supp. 2001).

        Section 22.27 of the Tax Code, referred to in the above provisions, makes confidential and
provides for the limited release of information provided by property owners to an appraisal district:

                [rlendition statements, real and personal property reports, attachments
                to those statements and reports, and other information the owner of
                property provides to the appraisal office in connection with the
The Honorable David Sibley - Page 3           (JC-0424)

                appraisal of the property, including income and expense information
                related to a property filed with an appraisal office and information
                voluntarily disclosed to an appraisal office or the comptroller about
                real or personal property sales prices after a promise it will be held
                confidential . . . .

Id. 8 22.27(a). Section 22.27 specifically authorizes the release of this information “to the person
who filed the statement or report or the owner of property subject to the statement, report, or
information or to a representative of either authorized in writing to receive the information.” Id.
5 22.27(b)(2). Th us, a property owner may always obtain information that he or she has provided
to the appraisal district or information about his or her property.

         Over ten years ago, this office construed section 25.195 and section 22.27 to give a property
owner a special right of access to information filed by others and made confidential under section
22.27 that is used to appraise the property owner’s property. See Tex. Att’y Gen. ORD Nos. 550
(1990) at 8; 500 (1988) at 9. In 1997, however, the legislature amended section 25.195 to include
the express reference to section 22.27 in subsection (a) of section 25.195 and to add subsection (b).
See Act of June 1, 1997,75th Leg., R.S., ch. 1039, 8 25, 1997 Tex. Gen. Laws 3897, 3910. The
effect of these amendments appears to have been to limit the right of access to information filed by
others and made confidential under section 22.27 to owners of vacant land and residential real
property, thus precluding owners of real property used for commercial purposes from obtaining such
information. See TEX. TAX CODE ANN. 5 25.195(b) (Vernon Supp. 2001) (“The owner of property
other than vacant land or real property used for residential purposes or the owner’s agent may not
inspect any material or information obtained under Section 22.27.“).

         Unlike subsections (a) and (b) of section 25.195, which address access to information in the
possession of an appraisal district, subsections (c) through (e), newly added by Senate Bill 1737,
address access to information held by a private appraisal firm. Subsections (c) and (d) provide as
follows:

                        (c) A property owner or the designated agent of an owner
               whose property is appraised by a private appraisal firm under a
               contract for appraisal services with an appraisal district is entitled to
               inspect and copy, at the office of thatjkn, all information pertaining
               to the property that the firm considered in appraising the property,
               including information showing each method of appraisal used to
               determine the value of the property and all calculations, personal
               notes, correspondence,    and working papers used in appraising the
               property.    This subsection does not apply to information made
               confidential by Section 22.27, except that the property owner or agent
The Honorable David Sibley - Page 4                 (JC-0424)

                  is entitled to inspect and copy any information relating to the owner’s
                  property, including otherwise confidential information.

                          (d) The appraisal firm shall make information covered by
                  Subsection (c) available for inspection and copying by the owner or
                  agent not later than the 15th day after the date the owner or agent
                  delivers a written request to inspect the information, unless the owner
                  or agent agrees in writing to a later date.

TEX. TAX CODE fj 25.195(c), (d), as added by Tex. S.B. 1737, 77th Leg., R.S. (2001) (emphasis
added). Under subsection (e), if an appraisal firm has not made the information available for
inspection and copying, the appraisal review board may not conduct a hearing on the merits of any
claim relating to the property and may not approve the appraisal records relating to that property.
See id. 5 25.195(e).

        With this background, we turn to your questions, which involve, in your words “[a] private
appraisal firm that does a substantial amount of business with appraisal districts in Texas.“’ You
explain that this firm is “refusing to provide complete appraisals of electric utility property to the
appraisal districts that it serves, providing instead a summary of the conclusions reached in the
appraisals and the major economic assumptions used to arrive at the results.” Request Letter, supra
note 1. Apparently, “[tlhe owners of electric utility property in appraisal districts served by this firm
have been denied access to the appraisals of their property performed by the firm, despite the fact
that the results of those appraisals are relied on by the appraisal districts in setting the appraised
value of their property on the district appraisal roles for ad valorem tax purposes.” Id.

        You ask the following questions about the Tax Code provisions governing access to appraisal
information:

                          Is a property owner’s access to appraisal information
                 regarding the owners property, as set forth in Section 25.195(a) of
                 the Tax Code, circumscribed by Section 25.01(c) of the Tax Code
                 which governs what information must be made available by a private
                 appraisal firm to an appraisal district and which limits what
                 constitutes supporting data?

                         Is a property owner entitled to copies of all appraisal material
                 and information regarding the owner’s property pursuant to Section
                 25.195(a) of the Tax Code?

         ‘Letter from Honorable David Sibley, Texas State Senator, to Honorable John Comyn, Texas Attorney General,
at 1 (May 17,200l) (on file with Opinion Committee) [hereinafter Request Letter].
The Honorable David Sibley      - Page 5      (JC-0424)

Id. at 3. You suggest that the appraisal firm defends its refusal to provide information on the
grounds that a property owner’s right of access to information concerning the appraisal of the
owner’s property is circumscribed by the definition of “supporting data” in section 25.01 (c) of the
Tax Code. See id. at 2.

        Under section 25.195 of the Tax Code as amended by Senate Bill 1737, a property owner has
a right of access to information used to appraise the owner’s property in the possession of the
appraisal district and in the possession of the private appraisal firm. As we will explain, the latter
type of access makes available to a property owner an array of information, including information
that the private appraisal firm is not required to provide to the appraisal district under section
25.01(c).

          Again, a property owner’s right of access to information in the possession of the appraisal
district is governed by subsections (a) and (b) of section 25.195. Under subsection (a), an owner of
utility property would be entitled to “appraisal records relating to property of the property owner,
together with supporting data, schedules, and . . . any other material or information held by the chief
appraiser or required by Section 25.01 (c) to be provided to the appraisal district under a contract for
appraisal services . . . .” TEX.TAX CODE fj 25.195(a), as amended by Tex. S.B. 1737,77th Leg., R.S.
(2001). Given that you ask about property owned by an electric utility, we assume that the property
at issue is neither vacant nor used for residential purposes. Therefore, subsection (b) would limit the
property owner’s right of access to information obtained under section 22.27, see TEX. TAX CODE
ANN. 4 25.195(b) (Vernon Supp. 2001), except for information to which section 22.27(b)(2) provides
the utility a special right of access, see id. 8 22.27(b)(2) (authorizing the release of confidential
information “to the person who filed the statement or report or the owner of property subject to the
statement, report, or information or to a representative of either authorized in writing to receive the
information”).

         In answer to your question about the relationship between section 25.195(a) and section
25.01(c), the recent Senate Bill 1737 amendment to subsection (a) makes it quite clear that a
property owner is entitled to information prepared by a private appraisal firm “required by Section
25.01 (c) to be provided to the appraisal district under a contract for appraisal services.” TEX. TAX
CODE 5 25.195(a), as amended by Tex. S.B. 1737,77th Leg., R.S. (2001). As noted above, section
25.01 (c) provides that an appraisal district is entitled to receive from a private appraisal firm with
which it contracts “copies of the appraisal, together with supporting data,” TEX. TAX CODE ANN.
9 25.01(c) (V emon 1992), but expressly excludes “personal notes, correspondence, working papers,
thought processes, or any other matters of a privileged or proprietary nature,” id., from the scope of
“supporting data.” Therefore, information that a private appraisal firm is not required to provide to
the appraisal district under section 25.01(c), such as “personal notes, correspondence,        working
papers, thought processes, or any other matters of a privileged or proprietary nature,” and that the
firm has not provided to the appraisal district, does not fall within the scope of a property owner’s
right of access under section 25.195(a).
The Honorable    David Sibley - Page 6         (JC-0424)

         Importantly, however, Senate Bill 1737’s addition of subsections (c) and (d) to section
25.195, which gives property owners a new right of access to information in the possession of a
private appraisal firm, also expands the type of information to which a property owner has access.
Under subsection (c), a property owner has a right of access to “all information pertaining to the
property that the firm considered in appraising the property, including information showing each
method of appraisal used to determine the value of the property and all calculations,personal notes,
correspondence, and workingpapers used in appraising the property.” TEX.TAX CODE fj 25.195(c),
as enacted by Tex. S.B. 1737, 77th Leg., R.S. (2001) (emphasis added). In addition, a property
owner also has a right to inspect and copy information made confidential under section 22.27
“relating to the owner’s property.” Id.

          Thus, in answer to your questions about the Tax Code, a property owner’s right of access to
information in the possession of an appraisal district under section 25.195(a) may be limited by
section 25.01(c) to the extent section 25.01(c) specifies information a private appraisal firm is not
required to give the appraisal district, namely “personal notes, correspondence, working papers,
thought processes, or any other matters of a privileged or proprietary nature,” TEX. TAX CODEAN-N.
5 25.01(c) (V emon 1992), because this information may not be in the possession of the appraisal
district. Recently enacted subsections (c) and (d) of section 25.195, however, give a property owner
a right of access to information in the possession of a private appraisal firm that the firm used to
appraise the owner’s property, including “calculations, personal notes, correspondence, and working
papers.” TEX. TAX CODE tj 25.195(c), (d), as enacted by Tex. S.B. 1737, 77th Leg., R.S. (2001).
This provision gives a property owner access to information that may not be in the possession of the
appraisal district.

          Finally, we address your question about the implications of 1999 electric utility deregulation
legislation for the right of access to information used to appraise electric utility property. You state
that the appraisal firm at issue also “defends its refusal to give complete appraisals of electric utility
property to the appraisal districts that it contracts with on the grounds that Senate Bill 7, enacted by
the 76th Legislature in 1999 to restructure the electric utility industry, requires that it protect
‘competitively sensitive information,’ and that it is doing so by withholding the complete appraisals
from the appraisal districts and from property owners.” Request Letter, supra note 1, at 2. For this
reason, you ask whether section 39.001 of the Utilities Code, or any other Senate Bill 7 provision,
modifies the Tax Code provisions on a property owner’s right of access to appraisal information.
See id. at 3. We conclude that nothing in Senate Bill 7 affects a property owner’s right of access to
appraisal information under section 25.195 of the Tax Code.

        The Seventy-sixth Legislature enacted numerous provisions to deregulate the electric utility
industry and open it to competitive pricing in Senate Bill 7. See Act of May 27, 1999, 76th Leg.,
R.S., ch. 405’1999 Tex. Gen. Laws 2543. The provision you mention, section 39.001 oftheutilities
Code, states that the legislature finds that it is in the public interest to “protect the competitive
process in a manner that ensures the confidentiality of competitively sensitive information during
The Honorable     David Sibley - Page 7             (JC-0424)

the transition to a competitive market and after the commencement of customer choice.” TEX. UTIL.
CODE ANN. 8 39.001(b)(4) (V emon Supp. 2001). Section 39.001 is a multi-part, introductory
provision declaring the legislature’s policy and purpose with respect to restructuring the electric
utility industry.     Its finding about confidentiality    does not make any specific information
confidential; rather, the finding explains the purpose of specific confidentiality provisions that follow
in chapter 39 of the Utilities Code and that require the Public Utility Commission (the “PUC”) to
keep confidential information collected for certain purposes. For example, section 39.155 of the
Utility Code requires the PUC to collect information on utilities’ generating capacity and sales in
order to assess their market power. It specifically provides that the PUC “shall by rule prescribe
the nature and detail of the reporting requirements and shall administer those reporting requirements
in a manner that ensures the confidentiality of competitively sensitive information.” Id. 5 39.155(a).
Section 39.35 1 requires power generation companies to register with the PUC and authorizes the
PUC to require registrants to file information “provided that in requiring that information the
commission shall protect the competitive process in a manner that ensures the confidentiality of
competitively sensitive information.” Id. 5 39.35 1(a)(4); see also id. 8 39.352(f) (requiring the PUC
to use information it collects in certifying retail electric providers “in a manner that ensures the
confidentiality   of competitively    sensitive information”).     None of these provisions apply to
information collected or used by a private appraisal firm or appraisal district in conjunction with the
appraisal of property.

         Two other provisions enacted by Senate Bill 7 amend the Open Meetings and Public
Information Acts to protect competitively sensitive information about electric utilities. Section
551.086 of the Government Code provides that the Open Meetings Act, chapter 551 of the
Government Code, does not require the governing body of a public power utility to deliberate,
vote or take final action on any competitive matter in an open meeting. See TEX. GOV’T CODEANN.
5 55 1.086(c) (V emon Supp. 2001) (“This chapter does not require a public power utility governing
body to conduct an open meeting to deliberate, vote, or take final action on any competitive matter,
as that term is defined in Subsection (b)(3).“). This provision deals with public power utilities’
meetings and does not address a property owner’s access to appraisal information in the possession
of a private appraisal fir-n-ror appraisal district.

         Similarly, section 552.13 1 of the Government Code, recently renumbered as section
552.133,* provides a new exception to the Public Information Act’s requirement that information be
disclosed to the public for public power utility information and records reasonably related to a
competitive matter. TEX. GOV’T CODE ANN. 8 552.13 l(b) (Vernon Supp. 2001) (“Information or
records are excepted from the requirements of Section 552.021 if the information or records are

         *In a nonsubstantive    correction of enacted codes, House Bill 2812 renumbered      section 552.13 1 of the
Government Code (as added by ch. 405,76thLeg.,      R.S., 1999) as section552.133. See Act ofMay 22,2001,77thLeg.,
R.S., ch. 1420, 2001 Tex. Sess. Law Serv., WL TX LEGIS 1420 (2001) (to be codified at TEX. GOV’T CODE ANN.
5 552.133) (eff. Sept. 1, 2001).
The Honorable David Sibley - Page 8           (JC-0424)

reasonably related to a competitive matter, as defined in this section.“). This provision appears to
address information in the possession of a public power utility rather than information relating to a
utility in the possession of a private appraisal firm or appraisal district. See, e.g., id. (“Information
or records of a municipaZZy owned utility that are reasonably related to a competitive matter are not
subject to disclosure under this chapter, whether or not, under the Utilities Code, the municipally
owned utility has adopted customer choice or serves in a multiply certificated service area. This
section does not limit the right of apublicpower utility governing body to withhold from disclosure
information deemed to be within the scope of any other exception provided for in this chapter,
subject to the provisions of this chapter.“) (emphasis added). Furthermore, it provides an exception
to the public’s right of access under the Public Information Act; it does not address a property
owner’s special right of access to information under section 25.195 of the Tax Code.

         In sum, under section 25.195(a) of the Tax Code a property owner has a right of access to
information about his property prepared by a private appraisal firm and obtained by the appraisal
district from the appraisal firm pursuant to section 25.01 (c) of the Tax Code. In addition, section
25.195(c) gives a property owner access to information in the possession of a private appraisal firm
that may not be in the possession of the appraisal district. Neither section 39.001 of the Utilities
Code nor any other provision enacted in the 1999 legislation deregulating the electric utility industry
affects a property owner’s right of access to appraisal information under section 25.195 of the Tax
Code. Finally, we caution that this opinion discusses a property owner’s right of access under
section 25.195 as amended in general terms. We do not decide what information might be available
to a property owner in a particular case.
The Honorable   David Sibley - Page 9         (JC-0424)

                                         SUMMARY

                         Under section 25.195(a) of the Tax Code, a property owner
                has a right of access to information about his property prepared by a
                private appraisal firm and obtained by the appraisal district from the
                appraisal firm pursuant to section 25.01 (c) of the Tax Code. In
                addition, section 25.195(c), a provision recently enacted by Senate
                Bill 1737, gives a property owner access to information in the
                possession of a private appraisal firm that may not be in the
                possession of the appraisal district.

                          Neither section 39.001 of the Utilities Code nor any other
                provision enacted by the Seventy-sixth Legislature in Senate Bill 7,
                legislation enacted in 1999 to deregulate the electric utility industry,
                affects a property owner’s right of access to appraisal information
                under section 25.195 of the Tax Code.

                                               Attorney General of Texas

HOWARD G. BALDWIN, JR.
First Assistant Attorney General

NANCY FULLER
Deputy Attorney General - General Counsel

SUSAN D. GUSKY
Chair, Opinion Committee

Mary R. Crouter
Assistant Attorney General, Opinion Committee