Tarrant County has initiated a legal move against what are being called "travelling Housing Finance Corporations" (HFCs), which are accused of dodging local taxes through a loophole that designates their acquired properties as "public property." According to a report by Tarrant County, these entities from other municipalities purchase and lease out properties within the county, claiming tax exemptions and channeling profits back to their origin cities or counties. This revenue sidestep is a loss to Tarrant taxpayers, as it would typically fund critical county services like schools and infrastructure.
Marking an escalation in the dispute, yesterday, the county filed petitions with the Tarrant Appraisal District (TAD) Appraisal Review Board to challenge the exemption status of 28 properties owned by these HFCs. These properties have a combined appraised value of nearly one billion dollars—$974 million to be precise—and the missing tax revenue stretches into the tens of millions. The county's effort could claw back funds not just for the current year but potentially for the past half-decade, where exemptions may have been improperly awarded. As reported by Tarrant County's news release, “These challenge petitions seek not only to remove the “public property” exemption for this year but also for any of the past five years for which an exemption may have been incorrectly granted.”
If Tarrant's challenge proves successful, the HFCs could face a significant financial hit, with back taxes coming due altogether this year. Notices will be sent out by TAD to all local authorities who have jurisdiction over properties impacted by these challenge petitions. They will explain their rights and logistics to appear at forthcoming hearings to contest Tarrant County’s claims.
