As the demand for water, oil and gas, and the land itself grows, owners of rural land are faced with an ever-changing world of rules and regulations. This 83rd legislative session Braun & Gresham followed all of these issues and more. We monitored nearly 160 bills from January through May, 2013, but not all passed. In this blog, Cassie Gresham summarizes those that survived, focusing on the bills that matter most to owners of rural land in Texas.
HB 316 – If a landowner loses a protest of their appraised or market value, this bill allows landowners to file an appeal of an order to the State Office of Administrative Hearings rather than filing a lawsuit. There are a few caveats: (1) the appraised or market value of the property must be more than $1M; (2) only applies to an appeal of real or personal property, not industrial property; and (3) the hearings will only be conducted certain in Texas cities. This may be a good option for landowners who don’t want to file a lawsuit over the appraisal of their property, but would like a judicial review of the appraisal.
HB 242 – This bill requires the chief appraiser to send notice to landowners by certified mail if: (1) a new agricultural use application is required; (2) the chief appraiser is applying a penalty for a late application; and (3) the chief appraiser believes that there is a change of use for agricultural or timber land. This is a good addition to the tax code because it will provide some additional protections and proper notice for landowners.
SB 764 – Section 153.081 of the Natural Resources Code limits the liability of an owner, lessee or occupant for property damage or for injury or death to persons caused by or resulting from prescribed burning. This bill expanded the type of land included under this provision to include conservation land, which is defined as “conservation or management of an ecosystem, a forest, a habitat, a species, water or wildlife.” This is great news for landowners who are managing their properties for wildlife and using prescribed burning as a management tool.
SB 655 – SB 655 amends current law to make it clear that the power of eminent domain may be only exercised for public use. According to the United States and Texas constitutions, eminent domain can only be used for a public use. However, in most cases, Texas statutes refer to “public purpose” or simply “purpose” when authorizing the use of eminent domain. Until 2011, all grants of eminent domain authority revolved around purpose rather than use. The problem with this language was recognized and partially addressed in S.B. 18, 82nd Legislature, Regular Session, 2011, by changing the language in the authorizing statutes for cities, counties, and school districts from public purpose to public use. However, clarity in law is crucial, as can be seen in cases like Kelo v. City of New London (545 U.S. 469, 2005) where the United States Supreme Court determined that “public purpose” can include such things as economic development and increased tax revenue. Because the Texas Legislature and Texas courts have closely followed the national trend of blurring the distinction between public use and public purpose, it is important to restore clarity in Texas law by restoring constitutional language in Texas statute. SB 655 restores constitutional language in Texas statute by making the “purpose” to “use” change in places in statute where eminent domain is authorized for use. This includes authorizations for entities governed by the Special District Local Laws Code and entities governed by the Water Code. The bill limits the exercise of eminent domain power by adding a section in the Special District Local Laws Code by stating that an entity governed by Title 6 (Water and Wastewater), Special District Local Laws Code, and authorized by law to exercise the power of eminent domain may only exercise the power for a public use. S.B. 655 limits the exercise of eminent domain power by adding a section in the Texas Water Code stating that an entity governed by Chapter 1 (General Provisions), Water Code, and authorized by law to exercise the power of eminent domain may only exercise the power for public use.
Property Owners’ Associations
HB 35 – This bill amends the Property Code to prohibit a property owners’ association from adopting or enforcing a provision in a dedicatory instrument that prohibits or restricts the owner of a lot on which a residence is located from using an adjacent lot owned by the property owner for residential purposes. The bill requires the owners to obtain approval, based on certain criteria prescribed by the dedicatory instruments before the owner begins the construction, placement, or erection of a building, structure, or other improvement for the residential purpose on an adjacent lot. The bill also requires the owner to either sell the adjacent lot with the lot containing the residence or restore the adjacent lot to the original condition.
HB 4 – As summarized in a great article by the Texas Center for Policy Studies, House Bill 4 sets up a revolving loan fund to implement the Texas Water Plan which will be funded through the transfer of $ 2.0 billion from the Economic Stabilization Fund (known as the Rainy Day Fund). However, “the new implementation fund will not become effective unless authorized by a constitutional amendment that will be before voters in the November 2013 statewide election.” To read more about the impacts of this bill on landowners, see the rest of the article HERE.