78R7120 RCJ-F

By:  Wilson                                                       H.B. No. 3136



A BILL TO BE ENTITLED

AN ACT

relating to the calculation of net to land in the ad valorem tax 
appraisal of open-space land used for wildlife management.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 23.51(4), Tax Code, is amended to read as 
follows:       
		(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 is covered by a written management plan developed in 
accordance with standards adopted under Section 23.521, the chief 
appraiser may not consider in the calculation of net to land the 
income that would be due to the owner of the land under a lease 
entered into for the purpose of qualifying the land under 
Subdivision (7) for appraisal under this subchapter.
	SECTION 2.  This Act takes effect January 1, 2004, and 
applies only to the appraisal of land for ad valorem tax purposes 
for a tax year beginning on or after that date.