By Madla                                               S.B. No. 438
         Substitute the following for S.B. No. 438:
         By Brown of Brazos                                 C.S.S.B. No. 438
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to permitting the value of natural resources to be
 1-3     included in the assessment of damages in a condemnation proceeding
 1-4     in certain circumstances.
 1-5           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
 1-6           SECTION 1. Subchapter C, Chapter 21, Property Code, is
 1-7     amended by adding Section 21.0421 to read as follows:
 1-8           Sec. 21.0421.  ASSESSMENT OF DAMAGES:  NATURAL RESOURCES. (a)
 1-9     In this section, "natural resources" means timber, sand or gravel,
1-10     limestone or other building stone, water, or any other mineral as
1-11     defined by Section 75.001 located on or under real property.
1-12           (b)  This section applies only to a political subdivision of
1-13     this state, a corporation with eminent domain authority, and an
1-14     irrigation, water improvement, or water power control district
1-15     created by law.
1-16           (c)  In a condemnation proceeding under this chapter
1-17     initiated by an entity described by Subsection (b), the special
1-18     commissioners or court, as applicable, shall admit evidence
1-19     relating to the market value of the natural resources as property
1-20     apart from the land in addition to the local market value of the
1-21     real property if:
1-22                 (1)  the entity proposes to condemn the fee title of
1-23     the real property; and
1-24                 (2)  the special commissioners or court finds, based on
 2-1     the evidence presented at the hearing, that the real property may
 2-2     be used by the entity to develop or use the natural resources
 2-3     located on or under the real property.
 2-4           (d)  The evidence submitted under Subsection (c) relating to
 2-5     the market value of the natural resources as property apart from
 2-6     the land must be based on generally accepted appraisal methods and
 2-7     techniques, including the methods of appraisal described by
 2-8     Subchapter A, Chapter 23, Tax Code.
 2-9           (e)  If the special commissioners or court are required to
2-10     admit evidence relating to the market value of natural resources
2-11     under Subsection (c), the special commissioners or court may assess
2-12     damage to the property owner based on:
2-13                 (1)  the local market value of the real property,
2-14     excluding the market value of the natural resources at the time of
2-15     the special commissioners' hearing; and
2-16                 (2)  the market value of the natural resources on or
2-17     under the real property, determined separately from the real
2-18     property, at the time of the special commissioners' hearing.
2-19           (f)  This section does not:
2-20                 (1)  authorize natural resources for which a value is
2-21     assessed under Subsection (e) to be appraised separately from the
2-22     real property for property tax appraisal purposes; or
2-23                 (2)  subject real property condemned in a proceeding
2-24     described by Subsection (c) to an additional tax as provided by
2-25     Section 23.46 or 23.55, Tax Code.
2-26           SECTION 2. (a)  This Act takes effect September 1, 2001.
2-27           (b)  This Act does not affect any litigation pending on
 3-1     September 1, 2001, in any court of competent jurisdiction that
 3-2     relates to the assessment of damages in a condemnation proceeding
 3-3     under Chapter 21, Property Code.