Binding Arbitration: Appealing an ARB Decision on Value

What Is Binding Arbitration?

Regular binding arbitration is an alternative to suing in district court after an ARB decision (Tax Code Chapter 41A). The Texas Comptroller appoints an arbitrator from a state registry. The arbitrator hears evidence from you and the appraisal district and sets the value. The decision binds both sides.

Who Qualifies for Arbitration

• The ARB decided value. The protest was about market value or unequal appraisal. Exemption and other non-value disputes don’t qualify.
• The property is within the limit. The value on the ARB order is $5 million or less, or the property is a residence homestead of any value.
• Taxes are paid. No prior-year taxes are delinquent, and the undisputed amount for the current year was paid before the delinquency date.
• No lawsuit on the same matter. You can arbitrate or sue, not both.
• No written settlement. If the value was resolved by written agreement, there’s nothing to arbitrate.

Arbitrators are required to dismiss requests that don’t meet these requirements, and a dismissed request can cost the full deposit. We check eligibility before filing.

The 60-Day Deadline and the Deposit

Deadline. The request must be filed within 60 days of receiving the ARB order. Requests filed by an agent go through the Comptroller’s online system.

Deposit. Each request requires a deposit paid to the Comptroller. The amount depends on the property type and the value on the ARB order.

Where the deposit goes:

• If the arbitrator’s value is closer to yours than to the ARB’s, the deposit is refunded, less a $50 administrative fee, and the appraisal district pays the arbitrator.
• If it isn’t, the deposit pays the arbitrator’s fee.

That rule shapes strategy: the opinion of value you submit should be one the evidence supports, not the lowest number you’d like.

How Arbitration Runs

1. Request filed with the deposit, within 60 days of the ARB order.
2. 45-day settlement period. The district and the owner can settle before an arbitrator is assigned. Withdrawing during this period refunds the deposit less $50.
3. Arbitrator appointed by the Comptroller.
4. Hearing. Scheduled by the arbitrator. Both sides present evidence, less formally than in court and without discovery.
5. Award. The arbitrator sets the value. The district corrects the roll.

Arbitration or a Lawsuit?

	Binding arbitration	Litigation
Value limit	$5 million, unless homestead	None
Deadline	60 days from the ARB order	60 days from the ARB order
Cost	Deposit; arbitrator paid from it if you don’t prevail	Attorney and expert costs
Discovery	None	Full discovery
Time to decision	Months	Often a year or more
Further appeal	Very limited	Available

For qualifying property with a clear value dispute, arbitration is usually the efficient choice. Litigation fits larger properties, multiple years, and cases that need the district’s records through discovery.

How We Handle Arbitration

We review the ARB order and our evidence, confirm eligibility, and tell you whether the likely savings justify the deposit and the effort. If they do, we file the request, negotiate during the settlement period, prepare the evidence package, and present at the hearing. We’ll explain what arbitration adds to our fee before anything is filed.

This guide is general information about the Texas Property Tax Code, not legal advice. Deadlines and rules can change with each legislative session.