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Texas Property Tax Code 2015 Chapter 23 Subchapter D

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TITLE 1. PROPERTY TAX CODE
SUBTITLE D. APPRAISAL AND ASSESSMENT
CHAPTER 23. APPRAISAL METHODS AND PROCEDURES
SUBCHAPTER D. APPRAISAL OF AGRICULTURAL LAND

                  

Sec. 23.51.  DEFINITIONS.  In this subchapter:

(1)  “Qualified open-space land” means land that is currently devoted principally to agricultural use to the degree of intensity generally accepted in the area and that has been devoted principally to agricultural use or to production of timber or forest products for five of the preceding seven years or land that is used principally as an ecological laboratory by a public or private college or university.  Qualified open-space land includes all appurtenances to the land.  For the purposes of this subdivision, appurtenances to the land means private roads, dams, reservoirs, water wells, canals, ditches, terraces, and other reshapings of the soil, fences, and riparian water rights.  Notwithstanding the other provisions of this subdivision, land that is currently devoted principally to wildlife management as defined by Subdivision (7)(B) or (C) to the degree of intensity generally accepted in the area qualifies for appraisal as qualified open-space land under this subchapter regardless of the manner in which the land was used in any preceding year.

(2)  “Agricultural use” includes but is not limited to the following activities:  cultivating the soil, producing crops for human food, animal feed, or planting seed or for the production of fibers; floriculture, viticulture, and horticulture; raising or keeping livestock; raising or keeping exotic animals for the production of human food or of fiber, leather, pelts, or other tangible products having a commercial value; planting cover crops or leaving land idle for the purpose of participating in a governmental program, provided the land is not used for residential purposes or a purpose inconsistent with agricultural use; and planting cover crops or leaving land idle in conjunction with normal crop or livestock rotation procedure.  The term also includes the use of land to produce or harvest logs and posts for the use in constructing or repairing fences, pens, barns, or other agricultural improvements on adjacent qualified open-space land having the same owner and devoted to a different agricultural use.  The term also includes the use of land for wildlife management.  The term also includes the use of land to raise or keep bees for pollination or for the production of human food or other tangible products having a commercial value, provided that the land used is not less than 5 or more than 20 acres.

(3)  “Category” means the value classification of land considering the agricultural use to which the land is principally devoted.  The chief appraiser shall determine the categories into which land in the appraisal district is classified.  In classifying land according to categories, the chief appraiser shall distinguish between irrigated cropland, dry cropland, improved pasture, native pasture, orchard, and waste.  The chief appraiser may establish additional categories.  The chief appraiser shall further divide each category according to soil type, soil capability, irrigation, general topography, geographical factors, and other factors that influence the productive capacity of the category.  The chief appraiser shall obtain information from the Texas Agricultural Extension Service, the Natural Resources Conservation Service of the United States Department of Agriculture, and other recognized agricultural sources for the purposes of determining the categories of land existing in the appraisal district.

(4)  “Net to land” means the average annual net income derived from the use of open-space land that would have been earned from the land during the five-year period preceding the year before the appraisal by an owner using ordinary prudence in the management of the land and the farm crops or livestock produced or supported on the land and, in addition, any income received from hunting or recreational leases.  The chief appraiser shall calculate net to land by considering the income that would be due to the owner of the land under cash lease, share lease, or whatever lease arrangement is typical in that area for that category of land, and all expenses directly attributable to the agricultural use of the land by the owner shall be subtracted from this owner income and the results shall be used in income capitalization.  In calculating net to land, a reasonable deduction shall be made for any depletion that occurs of underground water used in the agricultural operation.  For land that qualifies under Subdivision (7) for appraisal under this subchapter, the chief appraiser may not consider in the calculation of net to land the income that would be due to the owner under a hunting or recreational lease of the land.

(5)  “Income capitalization” means the process of dividing net to land by the capitalization rate to determine the appraised value.

(6)  “Exotic animal” means a species of game not indigenous to this state, including axis deer, nilga antelope, red sheep, other cloven-hoofed ruminant mammals, or exotic fowl as defined by Section 142.001, Agriculture Code.

(7)  “Wildlife management” means:

(A)  actively using land that at the time the wildlife-management use began was appraised as qualified open-space land under this subchapter or as qualified timber land under Subchapter E in at least three of the following ways to propagate a sustaining breeding, migrating, or wintering population of indigenous wild animals for human use, including food, medicine, or recreation:

(i)  habitat control;

(ii)  erosion control;

(iii)  predator control;

(iv)  providing supplemental supplies of water;

(v)  providing supplemental supplies of food;

(vi)  providing shelters; and

(vii)  making of census counts to determine population;

(B)  actively using land to protect federally listed endangered species under a federal permit if the land is:

(i)  included in a habitat preserve and is subject to a conservation easement created under Chapter 183, Natural Resources Code; or

(ii)  part of a conservation development under a federally approved habitat conservation plan that restricts the use of the land to protect federally listed endangered species; or

(C)  actively using land for a conservation or restoration project to provide compensation for natural resource damages pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. Section 9601 et seq.), the Oil Pollution Act of 1990 (33 U.S.C. Section 2701 et seq.), the Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.), or Chapter 40, Natural Resources Code.

(8)  “Endangered species,” “federal permit,” and “habitat preserve” have the meanings assigned by Section 83.011, Parks and Wildlife Code.

Acts 1979, 66th Leg., p. 2257, ch. 841, Sec. 1, eff. Jan. 1, 1982.  Amended by Acts 1981, 67th Leg., 1st C.S., p. 142, ch. 13, Sec. 67, eff. Jan. 1, 1982;  Acts 1985, 69th Leg., ch. 207, Sec. 1, eff. Sept. 1, 1985;  Acts 1987, 70th Leg., ch. 773, Sec. 1, eff. Jan. 1, 1988;  Acts 1987, 70th Leg., ch. 780, Sec. 1, 2, eff. Jan. 1, 1988;  Acts 1989, 71st Leg., ch. 796, Sec. 19, eff. Jan. 1, 1990;  Acts 1991, 72nd Leg., ch. 560, Sec. 1 to 3, eff. Jan. 1, 1992;  Acts 1993, 73rd Leg., ch. 203, Sec. 6, eff. Sept. 1, 1993;  Acts 1995, 74th Leg., ch. 911, Sec. 1, eff. Jan. 1, 1996;  Acts 2003, 78th Leg., ch. 775, Sec. 1, eff. Jan. 1, 2004.

Amended by:

Acts 2005, 79th Leg., Ch. 817 (S.B. 760), Sec. 1, eff. January 1, 2006.

Acts 2005, 79th Leg., Ch. 1126 (H.B. 2491), Sec. 6, eff. September 1, 2005.

Acts 2007, 80th Leg., R.S., Ch. 454 (H.B. 604), Sec. 1, eff. January 1, 2008.

Acts 2007, 80th Leg., R.S., Ch. 1112 (H.B. 3630), Sec. 3, eff. January 1, 2008.

Acts 2009, 81st Leg., R.S., Ch. 495 (S.B. 801), Sec. 1, eff. January 1, 2010.

Acts 2011, 82nd Leg., 1st C.S., Ch. 4 (S.B. 1), Sec. 46.01, eff. September 28, 2011.

                  

Sec. 23.52.  APPRAISAL OF QUALIFIED AGRICULTURAL LAND.  (a)  The appraised value of qualified open-space land is determined on the basis of the category of the land, using accepted income capitalization methods applied to average net to land.  The appraised value so determined may not exceed the market value as determined by other appraisal methods.

(b)  The chief appraiser shall determine the appraised value according to this subchapter and, when requested by a landowner, the appraised value according to Subchapter C of this chapter  of each category of open-space land owned by that landowner and shall make each value and the market value according to the preceding year’s appraisal roll available to a person seeking to apply for appraisal as provided by this subchapter or as provided by Subchapter C of this chapter.

(c)  The chief appraiser may not change the appraised value of a parcel of open-space land unless the owner has applied for and the land has qualified for appraisal as provided by this subchapter or by Subchapter C of this chapter or unless the change is made as a result of a reappraisal.

(d)  The comptroller by rule shall develop and distribute to each appraisal office appraisal manuals setting forth this method of appraising qualified open-space land, and each appraisal office shall use the appraisal manuals in appraising qualified open-space land.  The comptroller by rule shall develop and the appraisal office shall enforce procedures to verify that land meets the conditions contained in Subdivision (1) of Section 23.51 of this code.  The rules, before taking effect, must be approved by a majority vote of a committee comprised of the following officials or their designees:  the governor, the comptroller, the attorney general, the agriculture commissioner, and the Commissioner of the General Land Office.

(e)  For the purposes of Section 23.55 of this code, the chief appraiser also shall determine the market value of qualified open-space land and shall record both the market value and the appraised value in the appraisal records.

(f)  The appraisal of minerals or subsurface rights to minerals is not within the provisions of this subchapter.

(g)  The category of land that qualifies under Section 23.51(7) is the category of the land under this subchapter or Subchapter E, as applicable, before the wildlife-management use began.

Acts 1979, 66th Leg., p. 2258, ch. 841, Sec. 1, eff. Jan. 1, 1982.  Amended by Acts 1981, 67th Leg., 1st C.S., p. 143, ch. 13, Sec. 68, eff. Jan. 1, 1982;  Acts 1991, 72nd Leg., 2nd C.S., ch. 6, Sec. 24, eff. Sept. 1, 1991;  Acts 1995, 74th Leg., ch. 911, Sec. 2, eff. Jan. 1, 1996;  Acts 2001, 77th Leg., ch. 1172, Sec. 2, eff. Sept. 1, 2001.

Amended by:

Acts 2009, 81st Leg., R.S., Ch. 495 (S.B. 801), Sec. 2, eff. January 1, 2010.

                  

Sec. 23.521.  STANDARDS FOR QUALIFICATION OF LAND FOR APPRAISAL BASED ON WILDLIFE MANAGEMENT USE.  (a)  The Parks and Wildlife Department, with the assistance of the comptroller, shall develop standards for determining whether land qualifies under Section 23.51(7) for appraisal under this subchapter.  The comptroller by rule shall adopt the standards developed by the Parks and Wildlife Department and distribute those rules to each appraisal district.  On request of the Parks and Wildlife Department, the Texas Agricultural Extension Service shall assist the department in developing the standards.

(b)  The standards adopted under Subsection (a) may require that a tract of land be a specified minimum size to qualify under Section 23.51(7)(A) for appraisal under this subchapter, taking into consideration one or more of the following factors:

(1)  the activities listed in Section 23.51(7)(A);

(2)  the type of indigenous wild animal population the land is being used to propagate;

(3)  the region in this state in which the land is located;  and

(4)  any other factor the Parks and Wildlife Department determines is relevant.

(c)  The standards adopted under Subsection (a) may include specifications for a written management plan to be developed by a landowner if the landowner receives a request for a written management plan from a chief appraiser as part of a request for additional information under Section 23.57.

(d)  In determining whether land qualifies under Section 23.51(7) for appraisal under this subchapter, the chief appraiser and the appraisal review board shall apply the standards adopted under Subsection (a) and, to the extent they do not conflict with those standards, the appraisal manuals developed and distributed under Section 23.52(d).

Added by Acts 2001, 77th Leg., ch. 1172, Sec. 1, eff. Sept. 1, 2001.

Amended by:

Acts 2007, 80th Leg., R.S., Ch. 454 (H.B. 604), Sec. 2, eff. January 1, 2008.

                  

Sec. 23.522.  TEMPORARY CESSATION OF AGRICULTURAL USE DURING DROUGHT.  The eligibility of land for appraisal under this subchapter does not end because the land ceases to be devoted principally to agricultural use to the degree of intensity generally accepted in the area if:

(1)  a drought declared by the governor creates an agricultural necessity to extend the normal time the land remains out of agricultural production; and

(2)  the owner of the land intends that the use of the land in that manner and to that degree of intensity be resumed when the declared drought ceases.

Added by Acts 2009, 81st Leg., R.S., Ch. 1211 (S.B. 771), Sec. 3, eff. January 1, 2010.

                  

Sec. 23.53.  CAPITALIZATION RATE.  The capitalization rate to be used in determining the appraised value of qualified open-space land as provided by this subchapter is 10 percent or the interest rate specified by the Farm Credit Bank of Texas or its successor on December 31 of the preceding year plus 2-1/2 percentage points, whichever percentage is greater.

Acts 1979, 66th Leg., p. 2259, ch. 841, Sec. 1, eff. Jan. 1, 1982.  Amended by Acts 1995, 74th Leg., ch. 579, Sec. 4, eff. Jan. 1, 1996.

                  

Sec. 23.54.  APPLICATION.  (a)  A person claiming that his land is eligible for appraisal under this subchapter must file a valid application with the chief appraiser.

(b)  To be valid, the application must:

(1)  be on a form provided by the appraisal office and prescribed by the comptroller;  and

(2)  contain the information necessary to determine the validity of the claim.

(c)  The comptroller shall include on the form a notice of the penalties prescribed by Section 37.10, Penal Code, for making or filing an application containing a false statement.  The comptroller, in prescribing the contents of the application form, shall require that the form permit a claimant who has previously been allowed appraisal under this subchapter to indicate that previously reported information has not changed and to supply only the eligibility information not previously reported.  The form must include a space for the claimant to state the claimant’s date of birth.  Failure to provide the date of birth does not affect a claimant’s eligibility to have the claimant’s land appraised under this subchapter.

(d)  The form must be filed before May 1.  However, for good cause the chief appraiser may extend the filing deadline for not more than 60 days.

(e)  If a person fails to file a valid application on time, the land is ineligible for appraisal as provided by this subchapter for that year.  Once an application is filed and appraisal under this subchapter is allowed, the land is eligible for appraisal under this subchapter in subsequent years without a new application unless the ownership of the land changes or its eligibility under this subchapter ends.  However, subject to Section 23.551, if the chief appraiser has good cause to believe that land is no longer eligible for appraisal under this subchapter, the chief appraiser may require a person allowed appraisal under this subchapter in a prior year to file a new application to confirm that the land is currently eligible for appraisal under this subchapter by delivering a written notice that a new application is required, accompanied by the application form, to the person who filed the application that was previously allowed.

(f)  The appraisal office shall make a sufficient number of printed application forms readily available at no charge.

(g)  Each year the chief appraiser for each appraisal district shall publicize, in a manner reasonably designed to notify all residents of the district, the requirements of this section and the availability of application forms.

(h)  A person whose land is allowed appraisal under this subchapter shall notify the appraisal office in writing before May 1 after eligibility of the land under this subchapter ends or after a change in the category of agricultural use.  If a person fails to notify the appraisal office as required by this subsection a penalty is imposed on the property equal to 10 percent of the difference between the taxes imposed on the property in each year it is erroneously allowed appraisal under this subchapter and the taxes that would otherwise have been imposed.

(i)  The chief appraiser shall make an entry in the appraisal records for the property against which the penalty is imposed indicating liability for the penalty and shall deliver a written notice of imposition of the penalty to the person who owns the property.  The notice shall include a brief explanation of the procedures for protesting the imposition of the penalty.  The assessor for each taxing unit that imposed taxes on the property on the basis of appraisal under this subchapter shall add the amount of the penalty to the unit’s tax bill for taxes on the property against which the penalty is imposed.  The penalty shall be collected at the same time and in the same manner as the taxes on the property against which the penalty is imposed.  The amount of the penalty constitutes a lien on the property against which the penalty is imposed and accrues penalty and interest in the same manner as a delinquent tax.

(j)  If the chief appraiser discovers that appraisal under this subchapter has been erroneously allowed in any one of the five preceding years because of failure of the person whose land was allowed appraisal under this subchapter to give notice that its eligibility has ended, he shall add the difference between the appraised value of the land under this subchapter and the market value of the land to the appraisal roll as provided by Section 25.21 of this code for other property that escapes taxation.

Acts 1979, 66th Leg., p. 2259, ch. 841, Sec. 1, eff. Jan. 1, 1982.  Amended by Acts 1981, 67th Leg., 1st C.S., p. 143, ch. 13, Sec. 69, eff. Jan. 1, 1982;  Acts 1991, 72nd Leg., 2nd C.S., ch. 6, Sec. 25, eff. Sept. 1, 1991;  Acts 1993, 73rd Leg., ch. 1031, Sec. 14, eff. Sept. 1, 1993.

Amended by:

Acts 2015, 84th Leg., R.S., Ch. 352 (H.B. 1464), Sec. 4, eff. September 1, 2015.

                  

Sec. 23.541.  LATE APPLICATION FOR APPRAISAL AS AGRICULTURAL LAND.  (a)  The chief appraiser shall accept and approve or deny an application for appraisal under this subchapter after the deadline for filing it has passed if it is filed before approval of the appraisal records by the appraisal review board.

(b)  If appraisal under this subchapter is approved when the application is filed late, the owner is liable for a penalty of 10 percent of the difference between the amount of tax imposed on the property and the amount that would be imposed if the property were taxed at market value.

(c)  The chief appraiser shall make an entry on the appraisal records indicating the person’s liability for the penalty and shall deliver written notice of imposition of the penalty, explaining the reason for its imposition, to the person.

(d)  The tax assessor for a taxing unit that taxes land based on an appraisal under this subchapter after a late application shall add the amount of the penalty to the owner’s tax bill, and the tax collector for the unit shall collect the penalty at the time and in the manner he collects the tax.  The amount of the penalty constitutes a lien against the property against which the penalty is imposed, as if it were a tax, and accrues penalty and interest in the same manner as a delinquent tax.

Added by Acts 1981, 67th Leg., 1st C.S., p. 144, ch. 13, Sec. 70, eff. Jan. 1, 1982.

                  

Sec. 23.55.  CHANGE OF USE OF LAND.  (a)  If the use of land that has been appraised as provided by this subchapter changes, an additional tax is imposed on the land equal to the difference between the taxes imposed on the land for each of the five years preceding the year in which the change of use occurs that the land was appraised as provided by this subchapter and the tax that would have been imposed had the land been taxed on the basis of market value in each of those years, plus interest at an annual rate of seven percent calculated from the dates on which the differences would have become due.  For purposes of this subsection, the chief appraiser may not consider any period during which land is owned by the state in determining whether a change in the use of the land has occurred.

(b)  A tax lien attaches to the land on the date the change of use occurs to secure payment of the additional tax and interest imposed by this section and any penalties incurred.  The lien exists in favor of all taxing units for which the additional tax is imposed.

(c)  The additional tax imposed by this section does not apply to a year for which the tax has already been imposed.

(d)  If the change of use applies to only part of a parcel that has been appraised as provided by this subchapter, the additional tax applies only to that part of the parcel and equals the difference between the taxes imposed on that part of the parcel and the taxes that would have been imposed had that part been taxed on the basis of market value.

(e)  Subject to Section 23.551, a determination that a change in use of the land has occurred is made by the chief appraiser.  The chief appraiser shall deliver a notice of the determination to the owner of the land as soon as possible after making the determination and shall include in the notice an explanation of the owner’s right to protest the determination.  If the owner does not file a timely protest or if the final determination of the protest is that the additional taxes are due, the assessor for each taxing unit shall prepare and deliver a bill for the additional taxes plus interest as soon as practicable.  The taxes and interest are due and become delinquent and incur penalties and interest as provided by law for ad valorem taxes imposed by the taxing unit if not paid before the next February 1 that is at least 20 days after the date the bill is delivered to the owner of the land.

(f)  The sanctions provided by Subsection (a) of this section do not apply if the change of use occurs as a result of:

(1)  a sale for right-of-way;

(2)  a condemnation;

(3)  a transfer of the property to the state or a political subdivision of the state to be used for a public purpose; or

(4)  a transfer of the property from the state, a political subdivision of the state, or a nonprofit corporation created by a municipality with a population of more than one million under the Development Corporation Act (Subtitle C1, Title 12, Local Government Code) to an individual or a business entity for purposes of economic development if the comptroller determines that the economic development is likely to generate for deposit in the general revenue fund during the next two fiscal bienniums an amount of taxes and other revenues that equals or exceeds 20 times the amount of additional taxes and interest that would have been imposed under Subsection (a) had the sanctions provided by that subsection applied to the transfer.

(g)  If the use of the land changes to a use that qualifies under Subchapter E of this chapter, the sanctions provided by Subsection (a) of this section do not apply.

(h)  Additional taxes, if any, for a year in which land was designated for agricultural use as provided by Subchapter C of this chapter  (or Article VIII, Section 1-d, of the constitution) are determined as provided by that subchapter, and the additional taxes imposed by this section do not apply for that year.

(i)  The use of land does not change for purposes of Subsection (a) of this section solely because the owner of the land claims it as part of his residence homestead for purposes of Section 11.13 of this code.

(j)  The sanctions provided by Subsection (a) do not apply to a change in the use of land if:

(1)  the land is located in an unincorporated area of a county with a population of less than 100,000;

(2)  the land does not exceed five acres;

(3)  the land is owned by a not-for-profit cemetery organization;

(4)  the cemetery organization dedicates the land for a cemetery purpose;

(5)  the cemetery organization has not dedicated more than five acres of land in the county for a cemetery purpose in the five years preceding the date the cemetery organization dedicates the land for a cemetery purpose;  and

(6)  the land is adjacent to a cemetery that has been in existence for more than 100 years.

(k)  In Subsection (j), “cemetery,” “cemetery organization,” and “cemetery purpose” have the meanings assigned those terms by Section 711.001, Health and Safety Code.

(l)  The sanctions provided by Subsection (a) of this section do not apply to land owned by an organization that qualifies as a religious organization under Section 11.20(c) of this code if the organization converts the land to a use for which the land is eligible for an exemption under Section 11.20 of this code within five years.

(m)  For purposes of determining whether a transfer of land qualifies for the exemption from additional taxes provided by Subsection (f)(4), on an application of the entity transferring or proposing to transfer the land or of the individual or entity to which the land is transferred or proposed to be transferred, the comptroller shall determine the amount of taxes and other revenues likely to be generated as a result of the economic development for deposit in the general revenue fund during the next two fiscal bienniums.  If the comptroller determines that the amount of those revenues is likely to equal or exceed 20 times the amount of additional taxes and interest that would be imposed under Subsection (a) if the sanctions provided by that subsection applied to the transfer, the comptroller shall issue a letter to the applicant stating the comptroller’s determination and shall send a copy of the letter by regular mail to the chief appraiser.

(n)  Within one year of the conclusion of the two fiscal bienniums for which the comptroller issued a letter as provided under Subsection (m), the board of directors of the appraisal district, by official board action, may direct the chief appraiser to request the comptroller to determine if the amount of revenues was equal to or exceeded 20 times the amount of taxes and interest that would have been imposed under Subsection (a).  The comptroller shall issue a finding as to whether the amount of revenue met the projected increases.  The chief appraiser shall review the results of the comptroller’s finding and shall make a determination as to whether sanctions under Subsection (a) should be imposed.  If the chief appraiser determines that the sanctions provided by Subsection (a) shall be imposed, the sanctions shall be based on the date of the transfer of the property under Subsection (f)(4).

(o)  The sanctions provided by Subsection (a) do not apply to land owned by an organization that qualifies as a charitable organization under Section 11.18(c), is organized exclusively to perform religious or charitable purposes, and engages in performing the charitable functions described by Section 11.18(d)(19), if the organization converts the land to a use for which the land is eligible for an exemption under Section 11.18(d)(19) within five years.

(p)  The sanctions provided by Subsection (a) do not apply to real property transferred to an organization described by Section 11.181(a) if the organization converts the real property to a use for which the real property is eligible for an exemption under Section 11.181(a). This subsection does not apply to the sanctions provided by Subsection (a) in connection with a change in use described by this subsection that are due to a county or school district unless the governing body of the county or school district, as applicable, waives the sanctions in the manner required by law for official action by the body.

(q)  The sanctions provided by Subsection (a) do not apply to land owned by an organization that qualifies as a school under Section 11.21(d) if the organization converts the land to a use for which the land is eligible for an exemption under Section 11.21 within five years.

Acts 1979, 66th Leg., p. 2259, ch. 841, Sec. 1, eff. Jan. 1, 1982.  Amended by Acts 1981, 67th Leg., 1st C.S., p. 145, ch. 13, Sec. 71, eff. Jan. 1, 1982;  Acts 1983, 68th Leg., p. 4147, ch. 652, Sec. 2, eff. June 19, 1983;  Acts 1983, 68th Leg., p. 4824, ch. 851, Sec. 12, eff. Aug. 29, 1983;  Acts 1989, 71st Leg., ch. 796, Sec. 20, eff. Sept. 1, 1989;  Acts 1995, 74th Leg., ch. 471, Sec. 2, eff. June 12, 1995;  Acts 1995, 74th Leg., ch. 811, Sec. 1, eff. Aug. 28, 1995;  Acts 1997, 75th Leg., ch. 165, Sec. 31.01(74), eff. Sept. 1, 1997;  Acts 1997, 75th Leg., ch. 345, Sec. 5, eff. Sept. 1, 1997;  Acts 1997, 75th Leg., ch. 351, Sec. 1, eff. Sept. 1, 1997;  Acts 2003, 78th Leg., ch. 288, Sec. 1.08, eff. June 18, 2003;  Acts 2003, 78th Leg., ch. 1176, Sec. 1, eff. June 20, 2003.

Amended by:

Acts 2005, 79th Leg., Ch. 728 (H.B. 2018), Sec. 23.001(81), eff. September 1, 2005.

Acts 2007, 80th Leg., R.S., Ch. 885 (H.B. 2278), Sec. 3.69, eff. April 1, 2009.

Acts 2011, 82nd Leg., R.S., Ch. 1309 (H.B. 3133), Sec. 4, eff. June 17, 2011.

Acts 2013, 83rd Leg., R.S., Ch. 865 (H.B. 561), Sec. 1, eff. June 14, 2013.

Acts 2015, 84th Leg., R.S., Ch. 352 (H.B. 1464), Sec. 5, eff. September 1, 2015.

                  

Sec. 23.551.  ADDITIONAL NOTICE TO CERTAIN LANDOWNERS.  (a)  If land appraised as provided by this subchapter is owned by an individual 65 years of age or older, before making a determination that a change in use of the land has occurred, the chief appraiser shall deliver a written notice to the owner stating that the chief appraiser believes a change in use of the land may have occurred.

(b)  The notice must include a form on which the owner may indicate that the land remains eligible to be appraised as provided by this subchapter and a self-addressed postage prepaid envelope with instructions for returning the form to the chief appraiser.

(c)  The chief appraiser shall consider the owner’s response on the form in determining whether the land remains eligible for appraisal under this subchapter.

(d)  If the chief appraiser does not receive a response on or before the 60th day after the date the notice is mailed, the chief appraiser must make a reasonable effort to locate the owner and determine whether the land remains eligible to be appraised as provided by this subchapter before determining that a change in use of the land has occurred.

(e)  For purposes of this section, sending an additional notice to the owner immediately after the expiration of the 60-day period prescribed by Subsection (d) by first class mail in an envelope on which is written, in all capital letters, “RETURN SERVICE REQUESTED,” or another appropriate statement directing the United States Postal Service to return the notice if it is not deliverable as addressed, or providing the additional notice in another manner that the chief appraiser determines is appropriate, constitutes a reasonable effort on the part of the chief appraiser.

Added by Acts 2015, 84th Leg., R.S., Ch. 352 (H.B. 1464), Sec. 6, eff. September 1, 2015.

                  

Sec. 23.56.  LAND INELIGIBLE FOR APPRAISAL AS OPEN-SPACE LAND.  Land is not eligible for appraisal as provided by this subchapter if:

(1)  the land is located inside the corporate limits of an incorporated city or town, unless:

(A)  the city or town is not providing the land with governmental and proprietary services substantially equivalent in standard and scope to those services it provides in other parts of the city or town with similar topography, land utilization, and population density;

(B)  the land has been devoted principally to agricultural use continuously for the preceding five years; or

(C)  the land:

(i)  has been devoted principally to agricultural use or to production of timber or forest products continuously for the preceding five years; and

(ii)  is used for wildlife management;

(2)  the land is owned by an individual who is a nonresident alien or by a foreign government if that individual or government is required by federal law or by rule adopted pursuant to federal law to register his ownership or acquisition of that property; or

(3)  the land is owned by a corporation, partnership, trust, or other legal entity if the entity is required by federal law or by rule adopted pursuant to federal law to register its ownership or acquisition of that land and a nonresident alien or a foreign government or any combination of nonresident aliens and foreign governments own a majority interest in the entity.

Acts 1979, 66th Leg., p. 2260, ch. 841, Sec. 1, eff. Jan. 1, 1982.

Amended by:

Acts 2009, 81st Leg., R.S., Ch. 495 (S.B. 801), Sec. 3, eff. January 1, 2010.

                  

Sec. 23.57.  ACTION ON APPLICATIONS.  (a)  The chief appraiser shall determine separately each applicant’s right to have his land appraised under this subchapter.  After considering the application and all relevant information, the chief appraiser shall, as the law and facts warrant:

(1)  approve the application and allow appraisal under this subchapter;

(2)  disapprove the application and request additional information from the applicant in support of the claim;  or

(3)  deny the application.

(b)  If the chief appraiser requests additional information from an applicant, the applicant must furnish it within 30 days after the date of the request or the application is denied.  However, for good cause shown the chief appraiser may extend the deadline for furnishing the information by written order for a single period not to exceed 15 days.

(c)  The chief appraiser shall determine the validity of each application for appraisal under this subchapter filed with him before he submits the appraisal records for review and determination of protests as provided by Chapter 41 of this code.

(d)  If the chief appraiser denies an application, he shall deliver a written notice of the denial to the applicant within five days after the date he makes the determination.  He shall include with the notice a brief explanation of the procedures for protesting his action and a full explanation of the reasons for denial of the application.

Added by Acts 1981, 67th Leg., 1st C.S., p. 145, ch. 13, Sec. 72, eff. Jan. 1, 1982.

                  

Sec. 23.58.  LOAN SECURED BY LIEN ON OPEN-SPACE LAND.  (a)  A lender may not require as a condition to granting or amending the terms of a loan secured by a lien in favor of the lender on land appraised according to this subchapter that the borrower waive the right to the appraisal or agree not to apply for or receive the appraisal.

(b)  A provision in an instrument pertaining to a loan secured by a lien in favor of the lender on land appraised according to this subchapter is void to the extent that the provision attempts to require the borrower to waive the right to the appraisal or to prohibit the borrower from applying for or receiving the appraisal.

(c)  A provision in an instrument pertaining to a loan secured by a lien in favor of the lender on land appraised according to this subchapter that requires the borrower to make a payment to protect the lender from loss because of the imposition of additional taxes and interest under Section 23.55 is void unless the provision:

(1)  requires the borrower to pay into an escrow account established by the lender an amount equal to the additional taxes and interest that would be due under Section 23.55 if a change of use occurred on January 1 of the year in which the loan is granted or amended;

(2)  requires the escrow account to bear interest to be credited to the account monthly;

(3)  permits the lender to apply money in the escrow account to the payment of a bill for additional taxes and interest under Section 23.55 before the loan is paid and requires the lender to refund the balance remaining in the escrow account after the bill is paid to the borrower;  and

(4)  requires the lender to refund the money in the escrow account to the borrower on the payment of the loan.

(d)  On the request of the borrower or the borrower’s representative, the assessor for each taxing unit shall compute the additional taxes and interest that would be due that taxing unit under Section 23.55 if a change of use occurred on January 1 of the year in which the loan is granted or amended.  The assessor may charge a reasonable fee not to exceed the actual cost of making the computation.

(e)  In this section, “lender” has the meaning assigned by Section 23.47(e).

Added by Acts 1995, 74th Leg., ch. 82, Sec. 2, eff. May 11, 1995.

                  

Sec. 23.59.  APPRAISAL OF OPEN-SPACE LAND THAT IS CONVERTED TO TIMBER PRODUCTION.  (a)  If land that has been appraised under this subchapter for at least five preceding years is converted to production of timber after September 1, 1997, the owner may elect to have the land continue to be appraised under this subchapter for 15 years after the date of the conversion, so long as the land qualifies for appraisal as timber land under Subchapter E.  In that event, the land is deemed to be the same category of land under this subchapter as it was immediately before conversion to timber production.

(b)  The election must be made by a new application filed as provided by Section 23.54 and remains in effect for 15 years or until a change in use of the land occurs.

(c)  This section applies to the appraisal of land converted to timber production only until the end of the tax year in which the 15th anniversary of the date of the conversion occurs.  In the 16th and subsequent years, the land shall be appraised as timber land as provided by Subchapter E, so long as it qualifies as timber land under Subchapter E.

Added by Acts 1997, 75th Leg., ch. 765, Sec. 1, eff. Sept. 1, 1997.

                  

Sec. 23.60.  REAPPRAISAL OF LAND SUBJECT TO TEMPORARY QUARANTINE FOR TICKS.  (a)  An owner of qualified open-space land, other than land used for wildlife management, on which the Texas Animal Health Commission has established a temporary quarantine of at least 90 days in length in the current tax year for the purpose of regulating the handling of livestock and eradicating ticks or exposure to ticks at any time during a tax year is entitled to a reappraisal of the owner’s land for that year on written request delivered to the chief appraiser.

(b)  As soon as practicable after receiving a request for reappraisal, the chief appraiser shall complete the reappraisal.  In determining the appraised value of the land under Section 23.52, the effect on the value of the land caused by the infestation of ticks is an additional factor that must be taken into account.  The appraised value of land reappraised under this section may not exceed the lesser of:

(1)  the market value of the land as determined by other appraisal methods; or

(2)  one-half of the original appraised value of the land for the current tax year.

(c)  A property owner may not be required to pay the appraisal district for the costs of making the reappraisal.  Each taxing unit that participates in the appraisal district and imposes taxes on the land shall share the costs of the reappraisal in the proportion the total dollar amount of taxes imposed by that taxing unit on that land in the preceding year bears to the total dollar amount of taxes all taxing units participating in the appraisal district imposed on that land in the preceding year.

(d)  If land is reappraised as provided by this section, the governing body of each taxing unit that participates in the appraisal district and imposes  taxes on the land shall provide for prorating the taxes on the land for the tax year in which the reappraisal is conducted.  If the taxes are prorated, taxes due on the land are determined as follows:  the taxes on the land based on its value on January 1 of that year are multiplied by a fraction, the denominator of which is 365 and the numerator of which is the number of days in that year before the date the reappraisal was conducted; the taxes on the land based on its reappraised value are multiplied by a fraction, the denominator of which is 365 and the numerator of which is the number of days, including the date the reappraisal was conducted, remaining in the year; and the total of the two amounts is the amount of taxes imposed on the land for that year.  Notwithstanding Section 26.15, the assessor for each applicable taxing unit shall enter the reappraised value on the appropriate tax roll together with the original appraised value and the calculation of the taxes imposed on the land under this section.  If for any tax year the reappraisal results in a decrease in the tax liability of the landowner, the assessor for the taxing unit shall prepare and mail a new tax bill in the manner provided by Chapter 31.  If the owner has paid the tax, each taxing unit that imposed taxes on the land in that year shall promptly refund the difference between the tax paid and the tax due on the lower appraised value.

(e)  In appraising the land for any subsequent tax year in which the Texas Animal Health Commission quarantine remains in place, the chief appraiser shall continue to take into account the effect on the value of the land caused by the infestation of ticks.

(f)  If the owner of the land is informed by the Texas Animal Health Commission that the quarantine is no longer in place, not later than the 30th day after the date on which the owner received that information the owner of the land shall so notify the chief appraiser.  If the owner fails to notify the chief appraiser as required by this subsection, a penalty is imposed on the property equal to 10 percent of the difference between the taxes imposed on the property in each year it is erroneously allowed appraisal under this section and the taxes that would otherwise have been imposed.

(g)  The chief appraiser shall make an entry in the appraisal records for the property against which the penalty is imposed indicating liability for the penalty and shall deliver a written notice of imposition of the penalty to the person who owns the property.  The notice shall include a brief explanation of the procedures for protesting the imposition of the penalty.  The assessor for each taxing unit that imposed taxes on the property on the basis of appraisal under this section shall add the amount of the penalty to the unit’s tax bill for taxes on the property against which the penalty is imposed.  The penalty shall be collected at the same time and in the same manner as the taxes on the property against which the penalty is imposed.  The amount of the penalty constitutes a lien on the property against which the penalty is imposed and accrues penalty and interest in the same manner as a delinquent tax.

Added by Acts 2007, 80th Leg., R.S., Ch. 1011 (H.B. 967), Sec. 3, eff. June 15, 2007.

 

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