Williamson County Appraisal Dist. v. Nootsie, Ltd., 03-93-00588-CV
| Decision Date | 07 June 1995 |
| Docket Number | No. 03-93-00588-CV,03-93-00588-CV |
| Citation | 905 S.W.2d 289 |
| Parties | 103 Ed. Law Rep. 514 WILLIAMSON COUNTY APPRAISAL DISTRICT, Appellant, v. NOOTSIE, LTD. and State of Texas, Appellees. |
| Court | Texas Court of Appeals |
Russell R. Graham, Calame, Linebarger, Graham & Pena, L.L.P., Austin, for appellant.
William Ikard, Popp & Ikard, Dan Morales, Atty. Gen., Gregory E. Perry, Asst. Atty. Gen., Taxation Div., Austin, for appellees.
Before POWERS, JONES and B.A. SMITH, JJ.
Williamson County Appraisal District (the "District") appeals from an adverse judgment rendered in a suit brought by Nootsie, Ltd. for judicial review of an order issued by the District appraisal review board. See Tex. Tax Code Ann. §§ 42.21-.42 (West 1992 & Supp.1995) (the "Code"). We will reverse the trial-court judgment and render judgment as indicated below.
Nootsie applied to the appraisal review board to have Nootsie's land in Williamson County classified as "qualified open-space land" under the provisions of section 23.51(1) of the Code. See Code §§ 23.51(1), .54. For ad valorem tax purposes, land classified as "qualified open-space land" is appraised not at its market value but according to an income-capitalization method, provided the result does not exceed market value. Code § 23.52. The board rejected Nootsie's application, believing section 23.51(1) of the Code is unconstitutional to the extent it purports to include in the definition of "qualified open-space land" any "land that is used principally as an ecological laboratory by a public or private college or university." It is undisputed that Nootsie's land is used precisely for that purpose and is therefore entitled to the classification of "qualified open-space land" unless section 23.51(1) is unconstitutional to the extent the District claims.
Nootsie sued the District for review of the board's rejection order. The District counterclaimed for a declaratory judgment that section 23.51(1) is unconstitutional on the ground and to the extent claimed. After proper service of notice, the attorney general of Texas intervened and defended the constitutionality of section 23.51(1). Upon stipulated facts, the trial court adjudged the statute not unconstitutional, directed the District to grant Nootsie's application, and awarded ancillary relief. The District appealed to this Court.
Article VIII of the Texas Constitution sets forth in sections 1(a) and 1(b) the norm or standard for State taxation. Section 1(a) requires that "[t]axation shall be equal and uniform"; section 1(b) directs that all real property "shall be taxed in proportion to its value." See Tex. Const. art. VIII, §§ 1(a), 1(b). Taxation of real property is equal and uniform when it is based solely on the market value of the property involved. Lively v. Missouri, K. & T. Ry. Co., 102 Tex. 545, 120 S.W. 852, 856 (1909). Believing the market-value norm worked unfairly in the case of "agricultural property," the legislature in 1978 proposed "a constitutional amendment relating to ad valorem taxation of agricultural property." Act of Aug. 8, 1978, Tex.H.J.Res. 1, § 1, 65th Leg., 2d C.S., 1978 Tex.Gen.Laws 54 (the "resolution") (emphasis added). The proposed amendment would add to Article VIII of the Constitution a section 1-d-1, providing as follows:
(a) To promote the preservation of open-space land, the legislature shall provide by general law for taxation of open-space land devoted to farm or ranch purposes on the basis of its productive capacity and may provide by general law for taxation of open-space land devoted to timber production on the basis of its productive capacity. The legislature by general law may provide eligibility limitations under this section....
(b) If a property owner qualifies his land for designation for agricultural use under section 1-d of this article, the land is subject to the provisions of section 1-d for the year in which the designation is effective and is not subject to a law enacted under this section 1-d-1 in that year.
Id. § 2 (emphasis added). (The existing section 1-d of Article VIII, referred to in paragraph (b) of the proposed amendment, defined "[a]gricultural use" and provided for the taxing of such land "on the consideration of only those factors relative to such agricultural use."). Section 9 of the resolution directed that the proposed amendment "be printed to provide for voting for or against the proposition: 'The constitutional amendment providing for tax relief for ... agricultural land.' " Id. § 9 (emphasis added). The people adopted the proposed amendment in an election held November 7, 1978. There can be no doubt that they believed the scope of the amendment was limited to the two classes of land named in the amendment, agricultural land and timber land.
Pursuant to the 1978 amendment, the legislature enacted Subchapter D of the Code, being sections 23.51-.57. To secure the taxation of "qualified open-space land" on the basis of its productive capacity, section 23.52(a) of the Code provides that the appraised value of such land shall be determined "using accepted income capitalization methods applied to average net to land," but the appraised value resulting from that method "may not exceed the market value as determined by other appraisal methods." Code § 23.52(a).
To define the land eligible for the new appraisal method, the legislature provided as follows in section 23.51(1) of the Code:
(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 land that is used principally as an ecological laboratory by a public or private college or university.
Code § 23.51(1) (emphasis added). The effect of the statutory definition is to specify three different uses of land that may qualify as "open-space land" entitled to the new appraisal method described in section 23.52(a). They are: (1) land devoted principally to agricultural use to the degree of intensity indicated; (2) land devoted principally to the production of timber or forest products; and (3) "land that is used principally as an ecological laboratory by a public or private college or university." Id. The new appraisal method for all three is, of course, in derogation of the constitutional norm or standard that real property shall be taxed according to its market value. The 1978 amendment authorized the derogation expressly as to land devoted to an agricultural use and to timber production. The issue before us is whether the 1978 amendment also authorized, by implication, the new appraisal method for "land that is used principally as an ecological laboratory by a public or private college or university." We believe the 1978 amendment did not have that effect, as asserted by the District in its first point of error.
Nootsie does not contend its property comes within the definition of section 23.51(1) because the property is devoted to agricultural use or to the production of timber or forest products, the two uses authorized expressly in the 1978 amendment. 1 Nootsie contends rather that the legislature was authorized by the 1978 amendment to include a third class of land--land used as an "ecological laboratory"--because such use of open-space land is also within the objective of that amendment, as expressed in its introductory clause: "To promote the preservation of open-space land." We reject this theory.
"The Legislature may not authorize that which the Constitution prohibits." Maher v. Lasater, 163 Tex. 356, 354 S.W.2d 923, 925 (1962). Article VIII, sections 1(a) and 1(b) of the constitution prohibit the appraisal of land, for ad valorem tax purposes, on any basis except market value. The effect of the 1978 amendment was to remove the prohibition as to two specific classes of "open-space lands," that "devoted to farm or ranch purposes" and that "devoted to timber production." No branch of government is entitled to question the wisdom of the people in thus limiting the removal of the prohibition to these two classes of land; their limitation may not be enlarged or restricted further. See Jones v. Ross, 141 Tex. 415, 173 S.W.2d 1022, 1024 (1943) (); Cramer v. Sheppard, 140 Tex. 271, 167 S.W.2d 147, 154 (1943) ().
Maher is also illustrative. Article I, section 17 of the Constitution, prohibiting the taking of property for public use without adequate compensation paid in advance, also prohibits the public taking of property for private use. Tex. Const. art. I, § 17. The legislature enacted a statute authorizing the public taking of private property for private use if applicants wished it to be done and had no access to their property. The court held the statute unconstitutional as being repugnant to the constitutional prohibition against taking property for a private use. Maher, 354 S.W.2d at 924-25.
We believe, therefore, that the introductory clause of the 1978 amendment--"[t]o promote the preservation of open-space land"--did not constitute an implied invitation to the legislature to enlarge the two classes of land to any greater number because the additional classes would also...
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Nootsie, Ltd. v. Williamson County Appraisal Dist.
...constitutionally. The trial court ruled that the ecological laboratory provision is constitutional. The court of appeals reversed. 905 S.W.2d 289, 292. We hold that the statute is constitutional and therefore reverse the judgment of the court of The Texas Constitution commands that "[t]axat......