Tennessee Comptroller Jason Mumpower is advocating for a plan to increase the frequency of county property reappraisals to align them more closely with market values and prevent local governments from experiencing declines in tax revenue.

Mumpower, who introduced this proposal in May, has stated his intention to present a bill in 2024 aimed at expediting the statewide reappraisal schedule. Last year, 38 counties reported losses in property tax collections, ranging from $100 million to $113 million, contingent upon the growth rate of property values.

The motivation behind this initiative is the ongoing housing shortage in Tennessee, partly driven by an influx of 83,000 new residents in the previous year, making it the seventh-highest state for population growth. Mumpower says it’s important not to miss out on tax revenue from growth because of how sales ratios are used.

His proposal suggests shortening the reappraisal cycle to every two, three, or four years, with the possibility of yearly reappraisals for larger counties like Shelby, Davidson, Hamilton, Knox, Rutherford, Williamson, and Wilson. The Comptroller’s Office has estimated significant losses in property tax revenue for counties like Davidson and Shelby.

The current system necessitates property tax discounts due to the time lag between appraisals, involving the application of a sales ratio to adjust for differences between appraisals and market values. Mumpower states this approach has resulted in “extraordinary revenue loss” for 38 counties. An additional 36 counties anticipate to face similar revenue losses next year, prompting the need to accelerate reappraisal cycles.

Mumpower argues that annual reappraisals are a modern and globally accepted practice, contending that counties and the state possess the necessary technology to implement them. Several local property assessors, including Vivian Wilhoite and Rob Mitchell, support this proposal, citing instances where market values exceeded property appraisals significantly.

Wilhoite emphasizes that the state already conducts annual reappraisals for personal property and believes frequent appraisals will benefit property owners by preventing sudden tax increases.
Mumpower has presented this plan to various associations and organizations, receiving positive feedback on its fairness for taxpayers and local governments. Mitchell emphasizes that it is crucial to recognize the tax revenue generated from growth due to how sales ratios are employed.