Can a Texas appraisal review board member rule on a property-tax protest when they also worked for the taxpayer?

Plain-English summary

Two officials asked the Attorney General about conflicts of interest on the two boards that handle property-tax appraisal in Texas: the appraisal review board (ARB), which hears taxpayer protests, and the appraisal district board, which runs the appraisal office. The Harris County Attorney described a board member who had been appointed by a district court in 1984 to serve as receiver of a couple's property, then joined the Harris County ARB in 1989. The property owner later wanted that member to handle a protest of the property's value. The head of the Texas Department of Licensing and Regulation asked, more generally, whether a registered property tax consultant could sit on either board, and whether a member of either board could perform property tax consulting work in the same or a different district.

The Attorney General's core answer rested on Tax Code section 41.69, which says an ARB member "may not participate in the determination of a taxpayer protest in which he is interested" or in which he is related to a party within set degrees. The office had to define "interested." Finding no helpful legislative history, it looked to a parallel constitutional provision, article V, section 11, which forbids a judge from sitting in a case in which the judge "may be interested." Courts had read that to mean a direct personal or pecuniary interest. Applying the same meaning, the office held that an ARB member who represents a taxpayer as a paid, court-appointed receiver in a protest before the board has, as a matter of law, a direct pecuniary interest, and section 41.69 bars the member from taking part in deciding that protest. The same was true of an ARB member who performed property tax consulting services in a protest before the board.

The office cleared away the other statutes the requestors raised. Tax Code section 6.412(a) makes a person ineligible for the ARB if related within the second degree to someone who represents property owners for pay, but a person cannot be "related" to himself, so it did not reach a member who is personally the representative. Penal Code section 36.08, which bars certain gifts to public servants, did not prohibit a member from receiving adequate compensation for services done in an unofficial capacity. The office noted that Local Government Code chapter 171 (general local conflict-of-interest rules) could also apply, but that where it conflicts with section 41.69 for ARB members, the more specific section 41.69 prevails.

Turning to the appraisal district board, the office found no conflict-of-interest law barring a registered property tax consultant from serving on it, and held that the parallel eligibility statute, section 6.035(a), like section 6.412(a), does not reach a board member who is personally in the appraisal or representation business. For a district board member who does consulting work in a protest before that board, chapter 171 governs: the member must disclose a "substantial interest" in an involved business entity or real property and may have to abstain, but whether the member has a "substantial interest" is a fact question the opinion process cannot resolve. The state ethics law (Government Code chapter 572) did not apply, because it reaches only state officers and employees, not these local board members. And nothing barred a member of either board from doing consulting work before the board of a different appraisal district.

Currency note

This opinion was issued in 1993. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. The Property Tax Code conflict provisions, the property tax consultant licensing statute (formerly V.T.C.S. article 8886), and the consanguinity/affinity rules (moved from V.T.C.S. article 5996h into Government Code chapter 573) have all been amended and renumbered since 1993; confirm the current provisions before relying on anything described here.

Background and statutory framework

An appraisal review board generally has three members (Tax Code section 6.41(b)) who review and approve the appraisal records the chief appraiser submits, and who hear property owners' protests. Tax Code section 41.41 lists the actions a property owner may protest, from the appraised or market value of the property to denial of an exemption to "any other action" that adversely affects the owner. After notice and a hearing, the ARB decides the protest and corrects the records if needed.

The receiver question. The Harris County Attorney asked whether an ARB member could represent a taxpayer as the court-appointed receiver of the taxpayer's property in a protest before the member's own board. The member raised two statutes: Tax Code section 6.412(a) and Penal Code section 36.08. Section 6.412(a) makes a person ineligible for ARB service if "related within the second degree by consanguinity or affinity" to someone "engaged in the business of representing property owners for compensation in proceedings under this title in the appraisal district." The office walked through the Government Code consanguinity and affinity rules (sections 573.022 through 573.024), which all assume two people; a person cannot be related to himself. So section 6.412(a) did not apply where the member is personally the representative. Penal Code section 36.08 bars certain gifts to public servants but not adequate compensation for services performed in an unofficial capacity, so it did not apply either.

What did apply was Tax Code section 41.69, added in 1979, which bars an ARB member from participating in a protest "in which he is interested." Because the office found no legislative history on what "interested" covers, it surveyed similar provisions from 1979. Most modified "interest" with qualifiers like "personal or private" or "directly or indirectly." One did not: article V, section 11 of the Texas Constitution, which forbids a judge from sitting in a case in which the judge "may be interested." Courts construed that as a direct personal or pecuniary interest (City of Oak Cliff v. State). The office adopted that reading for section 41.69: an ARB member with a direct personal or pecuniary interest in a protest may not participate. A paid, court-appointed receiver representing the taxpayer has such an interest as a matter of law.

The office also flagged Local Government Code chapter 171, which regulates conflicts of interest of local public officials, including ARB members, and requires disclosure (and sometimes abstention) when an official has a "substantial interest" in a business entity or real property before the body. Chapter 171 preempts common-law conflict rules. But its disclosure-and-participate scheme can diverge from the flat bar in section 41.69. The office held that, to the extent chapter 171 and section 41.69 conflict as applied to an ARB member, section 41.69 prevails because it is the more specific statute.

The consultant questions. A registered property tax consultant is authorized (under former V.T.C.S. article 8886) to prepare renditions, represent owners in protests under subchapter C of chapter 41, advise on protests, negotiate with appraisal districts, and act as a designated agent under Tax Code section 1.111. The office found nothing barring such a consultant from serving on an ARB, but section 41.69 limits the member's participation: a member who performs consulting services in a protest before the board has a direct pecuniary interest and cannot take part in deciding it. Nothing, however, stopped the member from consulting before the ARB of a different district.

The appraisal district board, by contrast, is a five-member body with largely administrative duties (appointing the chief appraiser, approving the budget). The office found no law barring a registered property tax consultant from serving on it. The parallel eligibility statute, section 6.035(a), mirrors section 6.412(a), and for the same reasons did not reach a board member personally engaged in the appraisal or representation business; the office cited the bill's legislative history (testimony of Representative Valigura on House Bill 2495) showing the concern was a board member's relative in the appraisal business, not the member's own business. For a district board member who does consulting work in a matter before that board, chapter 171 controls, requiring disclosure of a "substantial interest," but whether such an interest exists is a fact question outside the opinion process. The state ethics law in Government Code chapter 572 applies only to state officers and employees, so it did not reach these local board members.

Common questions

Can an appraisal review board member decide a protest for a taxpayer they also work for?
No. Tax Code section 41.69 bars an ARB member from participating in a protest in which the member has a direct personal or pecuniary interest. A member who represented the property owner as a paid, court-appointed receiver, or who did property tax consulting work in that protest, has such an interest as a matter of law.

What does "interested" mean in section 41.69?
The office read it, by analogy to the constitutional rule for judges (article V, section 11), to mean a direct personal or pecuniary interest in the outcome, not just any general or indirect interest.

Can a registered property tax consultant serve on an appraisal review board at all?
Yes. The office found no statute or common-law rule barring it. But section 41.69 limits the member's participation: the member cannot help decide a protest in which the member did consulting work. The member can still consult before the board of a different appraisal district.

What rules apply to appraisal district board members instead?
For a district board member who performs consulting work in a matter before that board, Local Government Code chapter 171 governs. The member must disclose a "substantial interest" in an involved business entity or real property and may have to abstain. Whether the member has a "substantial interest" is a factual question the opinion process cannot decide.

Did the eligibility statutes (sections 6.412 and 6.035) or the Penal Code gift ban apply?
No. Sections 6.412(a) and 6.035(a) disqualify a member who is related to a representative, but a person cannot be related to himself, so they did not reach a member who is personally the representative. Penal Code section 36.08 bars certain gifts, not adequate compensation for services performed in an unofficial capacity.

Citations

Statutory and constitutional provisions discussed:

• Tex. Tax Code § 41.69 (ARB member may not participate in a protest in which interested)
• Tex. Tax Code § 41.41 (actions a property owner may protest)
• Tex. Tax Code § 6.412 (ARB eligibility; relation to a representative)
• Tex. Tax Code § 6.035 (appraisal district board eligibility; parallel provision)
• Tex. Local Gov't Code §§ 171.002, 171.004, 171.007 (substantial interest; disclosure/abstention; preemption)
• Tex. Penal Code § 36.08 (gifts to public servants)
• Tex. Const. art. V, § 11 (judge may not sit in a case in which interested)
• Tex. Gov't Code § 573.023 (computation of degree of consanguinity)
• V.T.C.S. art. 8886 (registered property tax consultant services)

Case discussed:

• City of Oak Cliff v. State, 79 S.W. 1068 (Tex. 1904)

Prior Attorney General opinions referenced: H-551 (1975), V-1215 (1951), DM-109 (1992), JM-1187 (1990), JM-424 (1986), JM-1060 (1989).

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0259
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1993/dm0259.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

Office of the Attorney General
State of Texas

DAN MORALES
ATTORNEY GENERAL

October 7, 1993

Mr. Jack W. Garison
Executive Director
Texas Department of Licensing and Regulation
P.O. Box 12157
Austin, Texas 78711

Honorable Mike Driscoll
Harris County Attorney
1001 Preston, Suite 634
Houston, Texas 77002

Opinion No. DM-259

Re: Whether a member of an appraisal review board may appear before the board either in a capacity as a court-appointed receiver or a registered property tax consultant without violating conflict-of-interest laws and related questions (RQ-507, ID# 18811)

Dear Mr. Garison and Mr. Driscoll:

Each of you has asked us to determine whether a member of an appraisal review board or an appraisal district board may perform certain professional services. Mr. Driscoll asks whether a member of an appraisal review board may represent a taxpayer in connection with the valuation of a certain tract or parcel of land in the board member's capacity as a court-appointed receiver of the same tract or parcel of land. Mr. Garison asks whether an appraisal review board member may perform property tax consulting services, in the same or a different appraisal district, without violating conflict-of-interest laws. Mr. Garison also asks whether an appraisal district board member may perform property tax consulting services, either in the same or a different appraisal district.

An appraisal review board generally consists of three members, Tax Code § 6.41(b), who meet to examine and approve appraisal records that the chief appraiser has submitted to the appraisal review board. Id. §§ 6.42(b), 41.01. Section 41.41 of the Tax Code provides a property owner with a right to protest several kinds of actions before an appraisal review board:

(1) determination of the appraised value of the owner's property or, in the case of land appraised as provided by Subchapter C, D, or E, Chapter 23, determination of its appraised or market value;
(2) unequal appraisal of the owner's property;
(3) inclusion of the owner's property on the appraisal records;
(4) denial to the property owner in whole or in part of a partial exemption;
(5) determination that the owner's land does not qualify for appraisal as provided by Subchapter C, D, or E, Chapter 23;
(6) identification of the taxing units in which the owner's property is taxable in the case of the appraisal district's appraisal roll;
(7) determination that the property owner is the owner of property;
(8) a determination that a change in use of land appraised under Subchapter C, D, or E, Chapter 23, has occurred, or
(9) any other action of the chief appraiser, appraisal district, or appraisal review board that applies to and adversely affects the property owner.

See also id. §§ 41.411, 41.42, 41.43. Following notice and a hearing, see id. §§ 41.45, 41.46, 41.461, the appraisal review board must determine the protest and, if necessary, correct the appraisal records to conform with its determination. See id. § 41.47(b).

Mr. Driscoll asks about the propriety of an appraisal review board member representing a taxpayer in a capacity as the court-appointed receiver of the taxpayer's property, which lies in the appraisal review board's jurisdiction. In his brief, Mr. Driscoll explains:

A receiver holds property for the benefit of the owner and the receiver's actions are generally in accordance with the best interests of the property owner. The receiver is also entitled to reasonable compensation for his services as receiver. . . .
In the situation at hand, the member had been appointed receiver by the judge of the 247th District Court of Harris County, Texas[,] in 1984. The judge of the 247th ordered that the receiver sell the property using "prudent real estate practices" and that the proceeds be distributed between the husband and wife.
Subsequently, the receiver was appointed to serve on the Harris County Appraisal Review Board in 1989 and again in 1991. . . .
On December 9, 1992[,] the property owner notified the appraisal district that the review board member would be handling [a] protest and withdrew his approval of the 1992 market value which had previously been settled with a district appraiser. [Footnote omitted.]

Mr. Driscoll particularly asks about the applicability of section 6.412(a) of the Tax Code and section 36.08 of the Penal Code. Under section 6.412(a) of the Tax Code, an individual is ineligible for service on an appraisal review board if the individual is "related within the second degree by consanguinity or affinity, as determined under Article 5996h, Revised Statutes,[1] to an individual who is engaged in the business . . . of representing property owners for compensation in proceedings under this title in the appraisal district for which the appraisal review board is established." (Footnote added.) The legislature enacted section 6.412(a) in 1989, see Acts 1989, 71st Leg., ch. 796, § 12, at 3595, and amended the subsection in 1991 by adding the language "as determined under Article 5996h, Revised Statutes," see Acts 1991, 72d Leg., ch. 561, § 45, at 1988.

Former article 5996h, V.T.C.S., see supra note 1, which the legislature also enacted in 1991 by the passage of House Bill 1345, see Acts 1991, 72d Leg., ch. 561, § 1, at 1979-80 (the same bill that amended section 6.412(a) of the Tax Code), provides that relationships by consanguinity or affinity must be determined using the civil law method. See Gov't Code § 573.021. The Government Code provides for the calculation of degree of relationship as follows:

Sec. 573.022. (a) DETERMINATION OF CONSANGUINITY. Two individuals are related to each other by consanguinity if: (1) one is a descendant of the other, or (2) they share a common ancestor. . . .
Sec. 573.023. (a) COMPUTATION OF DEGREE OF CONSANGUINITY. The degree of relationship by consanguinity between an individual and the individual's descendant is determined by the number of generations that separate them. A parent and child are related in the first degree, a grandparent and grandchild in the second degree, a great-grandparent and great-grandchild in the third degree and so on. . . .
Sec. 573.024. (a) DETERMINATION OF AFFINITY. Two individuals are related to each other by affinity if: (1) they are married to each other; or (2) the spouse of one of the individuals is related by consanguinity to the other individual.

By definition, the determination of degree of a relationship by consanguinity or by affinity assumes a relationship between two persons. Thus, for purposes of calculating the degree of a relationship by consanguinity or by affinity, a person may not be related to himself or herself. We do not believe the legislature envisioned that section 6.412(a) of the Tax Code would apply to a situation in which a member of the appraisal review board is the "individual who is engaged in the business . . . of representing property owners for compensation in proceedings under this title in the appraisal district for which the appraisal review board is established." See also infra note 11 and accompanying text (describing legislative history of Tax Code section 6.035(a)). In our opinion, therefore, section 6.412(a) of the Tax Code is inapplicable to the situation before us here.[2]

Additionally, section 36.08 of the Penal Code is inapplicable. Section 36.08 prohibits gifts to public servants in certain circumstances; it does not prohibit a public servant from receiving adequate compensation for services the individual performed in an unofficial capacity. See Penal Code §§ 36.08, 36.10(a)(1). See generally Attorney General Opinion H-551 (1975).

We believe that section 41.69 of the Tax Code governs this situation. Section 41.69 precludes a member of an appraisal review board from participating in the determination of certain taxpayer protests:

A member of the appraisal review board may not participate in the determination of a taxpayer protest in which he is interested or in which he is related to a party by affinity within the second degree or by consanguinity within the third degree, as determined under Article 5996h, Revised Statutes.[3] [Footnote added.]

The legislature added section 41.69 to the Tax Code in 1979. See Acts 1979, 66th Leg., ch. 841, § 1, at 2309.

To fully answer your question, we must deduce the meaning the legislature intended when it used the word "interested" in section 41.69 of the Tax Code. Unfortunately, we found no legislative history indicating the kinds of situations in which the legislature envisioned that an appraisal review board member might have an interest in a taxpayer protest. We look, therefore, to similar constitutional and statutory provisions in existence in 1979, of which we presume the legislature was aware. See Attorney General Opinion V-1215 (1951) at 2.

The majority of the provisions we examined, however, modify the word "interest" in such a way as to affect the interpretation of the provision. See, e.g., Tex. Const. art. III, § 18 (prohibiting legislator from being "interested, either directly or indirectly" in certain contracts with state), art. III, § 22 (requiring legislator with "personal or private interest" in proposed legislation to disclose interest and refrain from voting on proposal); Gov't Code § 573.058(a) (requiring state board or commission member with "personal or private interest" in matter before board to disclose interest and to refrain from voting on matter); Local Gov't Code § 81.002 (requiring newly appointed county judge or county commissioner to affirm that he or she "will not be interested, directly or indirectly" in contract with or claim against county). We found one provision, article V, section 11 of the Texas Constitution, that uses the word "interest" without any attendant modifiers, and we believe this provision and the judicial interpretation of this provision are instructive for our purposes here.

Article V, section 11 forbids a judge from sitting in any case in which the judge "may be interested, . . . or when he shall have been counsel in the case," among other things. "Interest" has been construed to refer to a direct personal or pecuniary interest in the case. See Tex. Const. art. V, § 11 interp. commentary; City of Oak Cliff v. State, 79 S.W. 1068, 1069 (Tex. 1904) (and cases cited therein); Attorney General Opinion DM-109 (1992) at 3-4 (and cases cited therein). We accordingly interpret section 41.69 of the Tax Code to apply whenever a member of an appraisal review board has a direct personal or pecuniary interest in the determination of a taxpayer protest before the appraisal review board. In our opinion, a member of an appraisal review board who, as a paid, court-appointed receiver, is representing a taxpayer in a protest before the appraisal review board has, as a matter of law, a direct personal or pecuniary interest in the result.[4] Section 41.69 of the Tax Code accordingly precludes the member's participation in the appraisal review board's determination of the protest.

We note that chapter 171 of the Local Government Code also may apply in this situation. Chapter 171 of the Local Government Code, which regulates conflicts of interest of local public officials, including a member of an appraisal review board, requires a local public official, prior to a vote or decision on any matter involving a business entity or real property in which the official has a substantial interest, to disclose the nature and extent of the interest. Local Gov't Code § 171.004(a); see 35 D. BROOKS, COUNTY AND SPECIAL DISTRICT LAW § 18.37, at 632-33 (Texas Practice 1989). In certain specified circumstances, the official also must abstain from further participation in the matter.[6] Id. Chapter 171 of the Local Government Code expressly preempts common-law conflicts-of-interest rules as they apply to local public officials. Local Gov't Code § 171.007(a); see also Attorney General Opinions JM-1187 (1990) at 4; JM-424 (1986) at 4.

Under chapter 171 of the Local Government Code, an official has a substantial interest in a business entity if

(1) the person owns 10 percent or more of the voting stock or shares of the business entity or owns either 10 percent or more or $5,000 or more of the fair market value of the business entity; or
(2) funds received by the person from the business entity exceed 10 percent of the person's gross income for the previous year.

Local Gov't Code § 171.002(a); see also Attorney General Opinion JM-1187 at 2-3. Notably, section 171.004(a) of the Local Government Code applies to any local public official who has a substantial interest in a business entity or real property that is involved in a matter before the governmental body. On the other hand, section 41.69 of the Tax Code applies only to members of an appraisal review board, but it applies to a taxpayer protest in which a member has a direct personal or pecuniary interest, regardless of the quantity of the interest. Thus, if a member of an appraisal review board is interested in a particular taxpayer protest before the board but that interest is not a "substantial interest" within the context of chapter 171 of the Local Government Code, section 171.004(a) authorizes the member to participate in the determination of the protest, while section 41.69 of the Tax Code prohibits the member's participation. Additionally, even if the member has a substantial interest, section 171.004(c) may authorize the member to participate after disclosing the nature and extent of the interest, while section 41.69 of the Tax Code prohibits the member's participation. To the extent of any conflict between section 171.004(a) of the Local Government Code as it applies to a member of an appraisal review board and section 41.69 of the Tax Code, section 41.69 prevails because it applies specifically to members of an appraisal review board. See 67 TEX. JUR. 3d Statutes § 126, at 719-24 (explaining that if general provision of statute irreconcilably conflicts with special or local provision, special or local provision generally prevails); id. § 136, at 752 (stating that if general statute and more detailed enactment conflict, latter generally prevails).

Mr. Garison's questions involve a registered property tax consultant. Article 8886, section 2(d)(7), V.T.C.S., authorizes a registered property tax consultant to perform or supervise the performance of the following services:

(A) preparing a property tax rendition or report for another person under Chapter 22, Tax Code;
(B) representing another person in a protest under Subchapter C, Chapter 41, Tax Code;
(C) consulting or advising another person concerning the preparation of a property tax rendition or report under Chapter 22, Tax Code, or concerning a matter the person may protest under Subchapter C, Chapter 41, Tax Code;
(D) negotiating or entering into an agreement with an appraisal district on behalf of another person concerning a matter that is or may be the subject of a protest under Subchapter C, Chapter 41, Tax Code; or
(E) acting as the designated agent of a property owner in accordance with Section 1.111, Tax Code.[7]

V.T.C.S. art. 8886, § 1(a)(7) (footnote added; footnote deleted). An appraisal review board hears matters protested under subchapter C, chapter 41 of the Tax Code. See id. § 1(a)(7)(C). Thus, a property tax consultant will have occasion to represent taxpayers before an appraisal review board.

Initially, Mr. Garison asks whether a registered property tax consultant may serve as a member of an appraisal review board.[8] We are unaware of any statutory or common-law provision that prohibits a registered property tax consultant from serving as a member of an appraisal review board. Of course, section 41.69 of the Tax Code limits a member's participation in a taxpayer protest in which the member has a direct personal or pecuniary interest. In our opinion, a member of an appraisal review board who performs property tax consulting services in a taxpayer protest that is before the appraisal review board has, as a matter of law, a direct personal or pecuniary interest in the outcome of the matter. Accordingly, section 41.69 of the Tax Code prohibits the member's participation in the determination of the protest.[9] Neither section 41.69 nor any other law of which we are aware limits a member of an appraisal review board from performing property tax consulting services before an appraisal review board of another district, however.

Mr. Garison also asks whether a registered property tax consultant may serve as a member of an appraisal district board, and conversely, whether a member of an appraisal district board may perform property tax consulting services, in the same or a different appraisal district, without violating conflict-of-interest laws.[10] Section 6.01(a), (b) of the Tax Code establishes in each county an appraisal district, which has the responsibility of appraising property in the district for ad valorem tax purposes of the taxing units in the appraisal district. See Tax Code § 1.04(12) (defining "taxing unit"); see also Attorney General Opinion JM-1060 (1989) at 1. A five-member board of directors governs each appraisal district. Tax Code § 6.03(a); see also Attorney General Opinion JM-1060 at 1. The duties of the appraisal district board are largely administrative; for example, the appraisal district board must appoint a chief appraiser, who serves as the chief administrator of the appraisal office, Tax Code § 6.05(c), and approve an annual budget for the appraisal district, id. § 6.06. Members of the public may comment on any issue within an appraisal district board's jurisdiction, see id. § 6.04(d), and may file complaints with the board, see id. § 6.04(f), (g). Because a registered property tax consultant is authorized to represent a property owner for any purpose under title 1 of the Tax Code, see V.T.C.S. art. 8886, § 1(a)(7)(E); Tax Code § 1.111(a), a property tax consultant may have occasion to represent a property owner before an appraisal district board.

We find no conflict-of-interest law that prohibits a registered property tax consultant from serving as a member of an appraisal district board. Regarding the propriety of an appraisal district board member performing property tax consulting services either in the same or a different appraisal district, we note initially that section 6.035(a) of the Tax Code parallels section 6.412(a) by making ineligible for service on an appraisal district board an individual "related within the second degree by consanguinity or affinity, as determined under Article 5996h, Revised Statutes, to an individual who is engaged in the business . . . of representing property owners for compensation in proceedings under this title in the appraisal district." The legislature enacted section 6.035(a) by means of the same bill that enacted section 6.412(a). See Acts 1989, 71st Leg., ch. 796, § 4, at 3592. The legislature subsequently amended section 6.035(a) expressly to reference article 5996h, V.T.C.S., by means of the same bill similarly amending section 6.412(a). See Acts 1991, 72d Leg., ch. 561, § 43, at 1987. But see supra note 1. For the reasons discussed in connection with section 6.412(a), see supra notes 1-2 and accompanying text, we believe that section 6.035(a) does not apply to a situation in which a member of an appraisal district board is "an individual who is engaged in the business of appraising property for compensation for use in proceedings under this title or of representing property owners for compensation in proceedings under this title in the appraisal district."[11]

We believe that chapter 171 of the Local Government Code governs the situation about which Mr. Garison asks.[12] Under chapter 171, a member of an appraisal district board must, prior to a vote or decision on any matter involving a business entity or real property in which the member has a substantial interest, disclose the nature and extent of the interest and possibly abstain from further participation in the matter.[13] See supra notes 5, 6 and accompanying text (discussing chapter 171 and comparing Gov't Code § 171.004(a) with Tax Code § 41.69). However, whether, for purposes of chapter 171 of the Local Government Code, a member of an appraisal district board has a substantial interest in a business entity and therefore must comply with section 171.004(a) is a question involving the resolution of facts; such a question cannot be determined in the opinion process. On the other hand, we are unaware of any statute that limits a member of an appraisal district board from performing property tax consultant services before the appraisal district board of another district.

SUMMARY

Pursuant to section 41.69 of the Tax Code, a member of an appraisal review board may not participate in the determination of a taxpayer protest before the appraisal review board in which the member, acting as a paid, court-appointed receiver of a tract of property in the appraisal district, represented a property owner because the member has, as a matter of law, a direct personal or pecuniary interest in the outcome of the protest. Similarly, section 41.69 of the Tax Code precludes a member of an appraisal review board from participating in the determination of a taxpayer protest if the member performed property tax consulting services in the protest because the member therefore has a direct personal or pecuniary interest in the determination of the protest.

Section 171.004(a) of the Local Government Code requires a member of an appraisal district board who has performed property tax consulting services in a taxpayer protest before the appraisal district board to disclose the nature and extent of the member's interest, but only if the member has a substantial interest in a business entity or real property involved in the matter. The determination of whether an appraisal district board member has such a substantial interest involves the resolution of facts; it is therefore outside the scope of the opinion process.

DAN MORALES
Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Deputy Attorney General for Litigation

RENEA HICKS
State Solicitor

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Kymberly K. Oltrogge
Assistant Attorney General

[1] In 1993 the Seventy-third Legislature repealed V.T.C.S. article 5996h. See Acts 1993, 73d Leg., ch. 268. The material in that article was codified as chapter 573 of the Government Code.

[2] Section 41.69 of the Tax Code prohibits a member of an appraisal review board from participating in the determination of a taxpayer protest in which the member personally is interested or in which the member is related within a prohibited degree to a party relevant to the protest. See infra (quoting Tax Code section 41.69). Clearly, if the legislature wanted to write section 6.412(a) to apply to a situation in which the appraisal review board member was personally involved as well as a situation in which the member was related to an individual representing property owners before the appraisal review board, the legislature could have done so.

[3] [See note 1 regarding the 1993 repeal of article 5996h and its codification as Government Code chapter 573.]

[4] [Footnote in original; text not fully legible in source scan.]

[6] Section 171.004(a)(1) requires a local public official to abstain from participation in a matter before the governmental body of which the official is a member if the official has a substantial interest in a business entity, and "action on the matter will have a special economic effect on the business entity that is distinguishable from the effect on the public." See infra (defining "substantial interest"). Similarly, section 171.004(a)(2) requires a local public official to abstain from participation in a matter before the governmental body of which the official is a member if the official has a substantial interest in real property, and "it is reasonably foreseeable that an action on the matter will have a special economic effect on the value of the property, distinguishable from its effect on the public." Id. (same). Failure to comply with the requirements section 171.004 articulates may constitute a class A misdemeanor. Local Gov't Code § 171.003.

[Note: Section 171.001(1) of the Local Government Code defines "local public official" as "a member of the governing body or another officer, whether elected, appointed, paid, or unpaid, of any district, county, municipality, precinct, central appraisal district, transit authority or district, or other local governmental entity who exercises responsibilities beyond those that are advisory in nature."]

[7] Section 1.111 of the Tax Code authorizes a property owner to designate a person to act as the owner's agent for any purpose under title 1 of the Tax Code (chapters 1-43) in connection with the property or property owner and provides the method by which a property owner may so designate.

[8] As we consider all of Mr. Garison's questions, we are aware that article 8886, section 6(a), V.T.C.S., requires the commissioner of licensing and regulation to "establish standards of practice, conduct, and ethics" for registered property tax consultants. Title 16, section 66.20(f) of the Texas Administrative Code articulates the code of ethics to which each registered property tax consultant must submit. The code of ethics contains no provisions that apply to any of the situations about which Mr. Garison asks for our opinion, however; article 8886, section 6(a), V.T.C.S., authorizes the commissioner to promulgate such provisions.

[9] For the reasons stated above, we do not consider the applicability of chapter 171 of the Local Government Code. See supra notes 5, 6 and accompanying text (discussing chapter 171 and comparing Government Code section 171.004(a) with Tax Code section 41.69).

[10] Additionally, Mr. Garison asks whether the state ethics law, Government Code chapter 572, formerly V.T.C.S. article 6252-9b, Acts 1993, 73d Leg., ch. 268, § 1, at 46, prohibits a member of either an appraisal district board or an appraisal review board from performing property tax consulting services in the same or a different district, or conversely, a registered property tax consultant from serving on either board. The state ethics law applies only to state officers and state employees, see Gov't Code § 572.001 (formerly V.T.C.S. art. 6252-9b, § 1); it does not apply, therefore, to a member of an appraisal district board or appraisal review board.

[11] Hearings on H.B. 2495 Before the House Subcomm. on Ways & Means, 71st Leg. (Apr. 1989) (statement of Representative Valigura) (tape available from House Committee Services Office). Additionally, Representative Valigura recounted for the subcommittee the circumstances in Montgomery County, which evidently prompted him to introduce House Bill 2495. He noted that a Montgomery County appraisal board member was rumored to have a relative in the appraisal review board who received preferential treatment. One of the board members, "a supporter of [Representative Valigura's]," also had a very good appraisal business. Representative Valigura felt that experts coming before the appraisal district board for protests or for valuations should not receive any type of preferential treatment. We believe that Representative Valigura's testimony lends further support to our conclusion that section 6.035(a) of the Tax Code applies only to situations in which a relative of a board member is involved in the appraisal business; the legislature did not intend the subsection to apply in a situation in which the board member himself or herself is involved in the appraisal business. Representative Valigura's bill, House Bill 2495, was left pending before the subcommittee of the House Committee on Ways and Means. However, the House Committee on Ways and Means incorporated into its committee substitute for House Bill 432 substantially similar language to that House Bill 2495 proposed for the new section 6.035 of the Tax Code. Furthermore, the committee substitute proposed the addition of section 6.412(a) to the Tax Code, the language of which is substantially similar to the language of section 6.035(a). Representative Stiles, the author of House Bill 432, considered House Bill 432 to be "an omnibus bill that . . . will clean up the problems of administration and financing of appraisal districts in the state."

[12] Section 41.69 of the Tax Code does not apply here because that section applies to the members of an appraisal review board, not to the members of an appraisal district board.

[13] This office has stated that a member of an appraisal district board is a local public official for purposes of chapter 171 of the Local Government Code. See Attorney General Opinion JM-1187 (1990).