78R3291 JD-D

By:  Wilson                                                       H.B. No. 480



A BILL TO BE ENTITLED

AN ACT

relating to eligibility of land located in certain municipalities 
to be appraised for ad valorem tax purposes as land designated for 
agricultural use, open-space land, timber land, or restricted-use 
timber land.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 23.42, Tax Code, is amended by amending 
Subsection (a) and adding Subsection (a-1) to read as follows:
	(a)  Except as provided by Subsection (a-1), an [An] 
individual is entitled to have land the individual [he] owns 
designated for agricultural use if, on January 1:
		(1)  the land has been devoted exclusively to or 
developed continuously for agriculture for the three years 
preceding the current year;
		(2)  the individual [he] is using and intends to use the 
land for agriculture as an occupation or a business venture for 
profit during the current year;  and
		(3)  agriculture is the individual's [his] primary 
occupation and primary source of income.
	(a-1)  Land is not eligible to be designated for agricultural 
use if the land is located inside the corporate limits of an 
incorporated city or town having a population of 500,000 or more.
	SECTION 2.  Section 23.56, Tax Code, is amended to read as 
follows:          
	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 the city or town has a 
population of less than 500,000 and:
			(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;  or
			(B)  the land has been devoted principally to 
agricultural use continuously for the preceding five years;
		(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.
	SECTION 3.  Section 23.77, Tax Code, is amended to read as 
follows:          
	Sec. 23.77.  LAND INELIGIBLE FOR APPRAISAL AS TIMBER 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 the city or town has a 
population of less than 500,000 and:
			(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;  or
			(B)  the land has been devoted principally to 
production of timber or forest products continuously for the 
preceding five years;
		(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.
	SECTION 4.  Subchapter H, Chapter 23, Tax Code, is amended by 
adding Section 23.98025 to read as follows:
	Sec. 23.98025.  LAND INELIGIBLE FOR APPRAISAL AS 
RESTRICTED-USE TIMBER LAND.  Land is not eligible for appraisal as 
provided by this subchapter if the land is located inside the 
corporate limits of an incorporated city or town having a 
population of 500,000 or more.
	SECTION 5.  This Act takes effect January 1, 2004, and 
applies only to an ad valorem tax year that begins on or after that 
date.