SRC-JLB H.B. 803 78(R)   BILL ANALYSIS


Senate Research Center   H.B. 803
By: Geren (Duncan)
Jurisprudence
5/13/2003
Engrossed


DIGEST AND PURPOSE 

Currently, when property is condemned by eminent domain, the landowner is
compensated for the fair market value of the land.  However, when land is
condemned specifically for its groundwater resources, the law does not
allow the fair market value of that groundwater to be considered in the
compensation paid to the landowner.  In a condemnation proceeding, special
commissioners appointed by the court assess actual damages to a property
owner based on the fair market value of the property.  Current
interpretation of the law rejects the right of a property owner to submit
evidence or to be compensated for the local market value of the
groundwater rights in addition to the local market value of the real
property.  H.B. 803 authorizes the special commissioners or court in a
condemnation proceeding to consider and award actual damages to a property
owner for the local market value of a real property's groundwater rights
in certain condemnation proceedings. 

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to
a state officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Subchapter C, Chapter 21, Property Code, by adding
Section 21.0421, as follows: 
 
Sec. 21.0421.  ASSESSMENT OF DAMAGES: GROUNDWATER RIGHTS.  (a) Requires
the special commissioners or court, in a condemnation proceeding initiated
by a political subdivision under this chapter, to admit evidence relating
to the market value of groundwater rights as property apart from the land
in addition to the local market value of the real property if certain
conditions exist. 

(b)  Requires the evidence submitted under Subsection (a) on the market
value of the groundwater rights as property apart from the land to be
based on generally accepted appraisal methods and techniques, including
the methods of appraisal under Subchapter A, Chapter 23, Tax Code. 
 
(c)  Authorizes the special commissioners or court, if the special
commissioners or court finds that the right to groundwater may be
developed or used for public purposes, to assess damages to the property
owner based on certain criteria. 

(d)  Requires the special commissioners or court, in assessing damages
based on the market value of groundwater rights under Subsection (c)(2),
to consider certain factors. 

(e)  Provides that this section does not authorize groundwater rights
appraised separately from the real property under this section to be
appraised separately from real property for property tax appraisal
purposes or subject real property condemned for the purpose described by
Subsection (a) to an additional tax as provided by Section 23.46 or 23.55,
Tax Code. 
 
 SECTION 2.  (a)  Effective date:  September 1, 2003.
 
(b)  Provides that the change in law made by this Act does not affect any
litigation pending on the effective date of this Act that relates to the
assessment of damages in a condemnation proceeding under Chapter 21,
Property Code.