By:  Geren                                                        H.B. No. 803



A BILL TO BE ENTITLED

AN ACT

relating to the assessment of damages in a condemnation proceeding 
based on the market value of groundwater rights as property apart 
from the land.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Subchapter C, Chapter 21, Property Code, is 
amended by adding Section 21.0421 to read as follows:
	Sec. 21.0421.  ASSESSMENT OF DAMAGES: GROUNDWATER RIGHTS.  
(a)  In a condemnation proceeding initiated by a political 
subdivision under this chapter, the special commissioners or court 
shall 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:
		(1)  the political subdivision proposes to condemn the 
fee title of real property; and
		(2)  the special commissioners or court finds, based on 
evidence submitted at the hearing, that the real property may be 
used by the political subdivision to develop or use the rights to 
groundwater for a public purpose.
	(b)  The evidence submitted under Subsection (a) on the 
market value of the groundwater rights as property apart from the 
land shall be based on generally accepted appraisal methods and 
techniques, including the methods of appraisal under Subchapter A, 
Chapter 23, Tax Code.
	(c)  If the special commissioners or court finds that the 
right to groundwater may be developed or used for public purposes, 
the special commissioners or court may assess damages to the 
property owner based on:
		(1)  the local market value of the real property, 
excluding the value of the groundwater in place, at the time of the 
hearing; and
		(2)  the market value of the groundwater rights as 
property apart from the land at the time of the hearing.
	(d)  In assessing damages based on the market value of 
groundwater rights under Subsection (c)(2), the special 
commissioners or court shall consider:
		(1)  the amount of groundwater the political 
subdivision can reasonably be expected to produce from the property 
on an annual basis;
		(2)  the number of years the political subdivision can 
reasonably be expected to produce groundwater from the property;
		(3)  the quality of the groundwater;                                   
		(4)  the location of the real property in relation to 
the political subdivision for conveyance purposes;
		(5)  any potential environmental impact of producing 
groundwater from the real property;
		(6)  whether or not the real property is located within 
the boundaries of a political subdivision that can regulate the 
production of groundwater from the real property;
		(7)  the cost of alternative water supplies to the 
political subdivision; and
		(8)  any other reasonable factor that affects the 
market value of a groundwater right.
	(e)  This section does not:                                             
		(1)  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
		(2)  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)  This Act takes effect September 1, 2003.                      
	(b)  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.