BILL ANALYSIS

C.S.H.B. 1513

By: Fletcher

Agriculture & Livestock

Committee Report (Substituted)

BACKGROUND AND PURPOSE

Interested parties point out that Texas has a long-standing tradition of supporting agriculture as evidenced by the law providing for the designation of certain land as qualified open-space land that is devoted principally to agricultural use for property tax purposes. The parties contend that the law would provide additional support for certain agricultural activities if more land is designated as such. C.S.H.B. 1513 seeks to address this issue.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

C.S.H.B. 1513 amends the Tax Code to decrease from five to two the minimum acreage of land used to raise or keep bees for pollination or for the production of human food or other tangible products having a commercial value in order for such use to be considered "agricultural use" as that term relates to the appraisal of open-space land for property tax purposes.

EFFECTIVE DATE

January 1, 2016.

COMPARISON OF ORIGINAL AND SUBSTITUTE

While C.S.H.B. 1513 may differ from the original in minor or nonsubstantive ways, the following comparison is organized and formatted in a manner that indicates the substantial differences between the introduced and committee substitute versions of the bill.

INTRODUCED

HOUSE COMMITTEE SUBSTITUTE

SECTION 1. Sections 23.51(1) and (2), Tax Code, are amended to read as follows:

(1) "Qualified open-space land" means land that is currently devoted principally to agricultural use to the degree of intensity generally accepted in the area and that has been devoted principally to agricultural use or to production of timber or forest products for five of the preceding seven years or for the preceding year or land that is used principally as an ecological laboratory by a public or private college or university. Qualified open-space land includes all appurtenances to the land. For the purposes of this subdivision, appurtenances to the land means private roads, dams, reservoirs, water wells, canals, ditches, terraces, and other reshapings of the soil, fences, and riparian water rights. Notwithstanding the other provisions of this subdivision, land that is currently devoted principally to wildlife management as defined by Subdivision (7)(B) or (C) to the degree of intensity generally accepted in the area qualifies for appraisal as qualified open-space land under this subchapter regardless of the manner in which the land was used in any preceding year.

(2) "Agricultural use" includes but is not limited to the following activities: cultivating the soil, producing crops for human food, animal feed, or planting seed or for the production of fibers; floriculture, viticulture, and horticulture; raising or keeping livestock; raising or keeping exotic animals for the production of human food or of fiber, leather, pelts, or other tangible products having a commercial value; planting cover crops or leaving land idle for the purpose of participating in a governmental program, provided the land is not used for residential purposes or a purpose inconsistent with agricultural use; and planting cover crops or leaving land idle in conjunction with normal crop or livestock rotation procedure. The term also includes the use of land to produce or harvest logs and posts for the use in constructing or repairing fences, pens, barns, or other agricultural improvements on adjacent qualified open-space land having the same owner and devoted to a different agricultural use. The term also includes the use of land for wildlife management. The term also includes the use of land to raise or keep bees for pollination or for the production of human food or other tangible products having a commercial value, provided that the land used is not less than 2 [5] or more than 20 acres.

SECTION 1. Section 23.51(2), Tax Code, is amended to read as follows:

SECTION 2. Section 23.55(a), Tax Code, is amended to read as follows:

(a) If the use of land that has been appraised as provided by this subchapter changes, an additional tax is imposed on the land equal to the difference between the taxes imposed on the land for each of the two [~~five~~] years preceding the year in which the change of use occurs that the land was appraised as provided by this subchapter and the tax that would have been imposed had the land been taxed on the basis of market value in each of those years, plus interest at an annual rate of seven percent calculated from the dates on which the differences would have become due. For purposes of this subsection, the chief appraiser may not consider any period during which land is owned by the state in determining whether a change in the use of the land has occurred.

No equivalent provision.

SECTION 3. Section 23.51, Tax Code, as amended by this Act, applies only to the appraisal of land for ad valorem tax purposes for a tax year that begins on or after the effective date of this Act.

SECTION 2. Substantially the same as introduced version.

SECTION 4. Section 23.55, Tax Code, as amended by this Act, applies only to a change in the use of land appraised under Subchapter D, Chapter 23, Tax Code, that occurs on or after the effective date of this Act. A change in the use of land appraised under Subchapter D, Chapter 23, Tax Code, that occurred before the effective date of this Act is governed by the law in effect on the date the change in use occurred, and the former law is continued in effect for that purpose.

No equivalent provision.

SECTION 5. This Act takes effect January 1, 2016.

SECTION 3. Same as introduced version.