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TNT, It's .D.y. _n. amite! Dght ng the Fuse for Full Disclosure Jim Fort6 and Becky Grimm, Govo'Net Solutlo,u, Dallas There have probably'~1"~'~. ~"~ been very few/J pieces of city- related legislation passed in recent ye~s that have been as volatile = "TNT." Although proper~ v~ues soared in the 1970s, properw t~ rares weren't declining at a corresponding rite, so in 1979 T~ lawm~ers decided to t~e matters inro their own hands by p~sing ~ ~plosive piece of legislation that required broader disclosure of information about properw t~es. ~ming in · e same era ~ the C~ifornia t~- payers' revolr and its resulting Proposition 13, ~d the petition- driven "Tax Payer's Bill of ~ghts" (T~OR), Constitution~ ~end- ment in Colorado, %x~' "%uth in T~ation" (TNT) movement w~ intended to force ~ disclosure of the proper~ t~ process ~d m~e it more acc~sible to ~e cidzen~. The legislation m~dated a series of notices inrended to provide t~payers with a comparison of properW t~ burden from year to year. The legislation attempted to clari~ the relationship be~een consecutive t~ ye~s, ~lowing for only a three percent flat rate adjust- ~:& ~..~_ for inflated ment ~ values, and property x giving the taxing enti- ~'~I ty only the same amount of property tax revenue as was collected in the prior year, with some exceptions. The wording of the required notices, which suggested that numer- ous votes had been taken regarding "tax increases," was confusing and led to inclusion of similarly worded notices by each taxing entity telling taxpayers that the other notice didn't mean anything. Dueling half- page advertisements would appear in newspapers of general circula- tion, one containing the statutory notice, and the other encouraging taxpayers to ignore it and become more informed by attending meet- ings relating to the adoption of the tax rate. The legislation assumed an uninformed citizenry, one that needed to be reminded (in spite of local charter requirements for dis- dosure, public hearings, and open budget work sessions) that they had a duty beyond the election of their public officials. They had to also watch the purse strings dosely, to ensure that iii-gotten wealth not be accumulated. One of the early technical fallacies of this theory 5vas that costs for goods and services inflated at a rate no greater than that of property values, or that inflation would be no more than three percent (the statuto- rily allowed threshold). Even today, many taxing entities will target a tax rate increase of 2.99 percent to avoid even the minimum notice and hear- ing requirements. In addition, the for- mulas assumed that values only go up, and that costs of goods and services only rise relative to property value. Some of the early problems with these stamtorily-mandated equations were the simultaneous plmmmeting prop- erty values and soaring energy costs of the 70s and 80s. The controlling element of TNT is Chapter 26 of the Property Tax Code. An excellent explanation of the requirements and mechanics for TNT can be found on the Internet, on a site maintained by rhe state comptroller's office (www. window. state.tx, us/taxin fo/proptax/mt00/ index, html). Much of what is dis- cussed in the balance oF this article is extractcd from these two source documents with specific focus on those directly affecting cities as the taxing units.