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JIM MATTOX Attorney General

Supreme Court Bullding P. 0. Box 12546 Austin, TX. 76711. 2546 5121475-2501 Telex 9101674-1367 Telecopier 5121475-0266

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An Equal OpportunityI Affirmative Action Employer

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# The Attorney General of Texas

November 9, 1983

Honorable Tom Uher Chairman OpinionNO.JM-87 Committeeon Regions,Compactsand Districts Texas House of Representatives Austin, Texas 78769 Re: Whether constitutional and statutory tax exemptions, specifically section 23.42 of the Tax Code and articleVIII, sections l-d, l-d-l, 19, and 19aof the Texas Constitution, pertain to fish and other forms of aquatic life
Dear RepresentativeUher:
You ask whether constitutional and statutory ad valorem tax exemptions and special valuation provisions, specifically section 23.42 of the Tax Code and article VIII, sections l-d, l-d-l, 19, and 19a of the Texas Constitution, pertain to fish and other forms of aquatic life. We conclude that they do. Section 23.42(d)(l) of the Tax Code sets forth the following definition of “agriculture” for purposes of calculating the value of realpropertyused for “agriculturalpurposes”under special statutes: ‘Agriculture’means the use of land to produce

plant or animal products, including fish or poultry products, under natural conditions but doesnot include theprocessing of plant or animal products after harvesting or the production of timberor forestproducts. (Emphasisadded). valuation

Before addressing the scopeof the statutorydefinition,we must first determine whether the definition of “agricultural use” set forth in section 23.42,by its inclusionof “fish
. . .products,” expands the definition of “agriculture” or “agricultural use” contained in the aforementioned Texas constitutional provisions. If it does, it is unconstitutionaland void. See City of AmarilloV. Amarillo LodgeNo. 731, A.F. & A.M., 488 S.W.2d 69 (Tex. 1972); Leander Independent School Districtv. Cedar ParkWater Supply Corporation,479 S.W.2d 908 (Tex. 1972);Dickisonv. Woodmen of the World Life Insurance Society, 280 S.W.2d 315 (Tex. Civ. App. - San Antonio 1955, writ ref’d). We conclude that section 23.42, with its inclusion of “fish
. . . products” in itsdefinitionof “agriculture,”is constitutional.

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ArticleVIII, section l-dof theTexas Constitutionrequires that l~and qualifying for the agricultural use designation shall be appraised for ad valorem taxpurposes,not at marketvalue, but on the basis of those factors relative to agriculturaluse. Subsection (a) provides that

'lalgricultural use' means the raising of livestockor growing of crops, fruit, flowers,and other products of the soil under natural conditionsas a businessventure forprofit,which business is the primary occupation and source of income of the owner. (Emphasisadded). Article VIII, section l-d-l(a) of the Texas Constitutionpermits the legislatureby general law to provide for ad valorem taxation of land "devoted to farm or ranch purposes." We note, of course, that "agricultural use" under article VIII, section l-d of the Texas Constitutionextends specialvaluationbenefits only to thoseproducts grown under "natural conditions." No such ljmitation restricts the scope of article VIII, section l-d-l. Article VIII, section 19 exempts from taxation "farm products, livestock, and poultry in the hands of the producer." Finally article VIII, section 19a exempts from taxation "implementsof husbandry that are used in theproduction of farm or ranchproducts." Words in a constitutionwill be considered to have been used in their natural sense, Markowsky v. Newman, 136 S.W.2d 808, 813 (Tex. 1940). and ordinary signification,Fergusonv. Wilcox, 28 S.W.2d 526, 530 (Tex. 1930), unless the context indicates the contrary. Sugg v. Smith, 205 S.W. 363, 373 (Tex. Civ. App. - Austin 1918,writ ref'd). Language used in constitutionalprovisions must be presumed to have been carefully selected, and the words used are to be understood as people generallyunderstand them. Leander IndependentSchoolDistrict v. Cedar Park Water Supply Corporation, Sheppard, 167 S.W.2d 147, 152 (Tex. 1942). supra at 912; Cramer v. Words and phrases such as "agricultural," "livestock," "products of the soil," "farm or ranch purposes," and "farm or ranch products" do not ordinarily signify or include the production of fish or other forms of aquatic life. However, "agriculture"has been definedas

[t]he art or science of cultivatine.the eround.

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_ including harvestins of crons and rearine and management of live stock;husbandry; farming, - in a broader sense, the science snd act of the production of plants and animals useful to man. (Emphasisadded). Cordonv. Buster, 257 S.W. 220, 221 (Tex. 1923).
No Texas case has directly addressed this specific issue. However, this office has construed "agriculture" to include

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“mariculture.” In Attorney General Opinion H-272 (1974). this office concluded that a statute authorizing demonstrations in “agriculture and home economics”was sufficientlybroad to include demonstrations on marlculture and fisheries. The opinion not.edthat “mariculture” may be defined as “the cultivation of marine organisms by exploiting theirnatural environment.‘IThe opiniondeclared that

‘agriculture’was intended tomean, in addition to the cultivati~onand harvesting of crops (its narrow definition), the **SCilZ”W** and art of production of plants and animals useful to man . . . including
. . .mariculture. Attorney GeneralOpinjonH-272 (1974). Clearlv our resuonsibilitv. like that of the courts. is to determine iegislativd intent >hd give effect to it. Knight V. International Harvester Credit Corp., 627 S.W.Zd 382 (Tex. 1982); Minton V. Frank, 545 S.W.Zd 442 (Tex. 1976). In this instance, however, our examination of the legislativehistory pertaining to the

. . recent property tax enactments does not reveal legislative intent as to this issue. Nevertheless,we conclude that a better readingof the applicable constitutional provisions would include “mariculture” or, more properly, “fish
. . .products”within the ambit of “agriculture” or “livestock.”
We now must turn to an examfnationof sectjon 23.42(d)(l)of the Tax Code to determine the scope of the phrase “fish
. . .products.” You specifically wish to know whether “shrimping, fishing, the harvesting of the sea, and the raising of acquatic plant and animal life in man-made and natural environments” falls within the ambit of section 23.42, Without attempting to enumeratean exhaustive list of products and activitieswhich fall within section 23.42, we conclude that each of the above activities could fallwithin the denotation of “mariculture”and, therefore, of “agriculture” in its broad sense if such activity includes cultivation or production. To the extent that “mariculture” consists of cultivation or production,we believe that it is included within the meaning of “agriculture” for purposes of section 23.42. To the extent that “harvesting” consists of the mere capture of animal life. we believe it is not within the meaning of “agriculture.” For example, a person who engages in the licensed practice of fish farmingpursuant to chapter 48, a personwho engages in I.!.censed

shellfish culture pursuant to chapter 51, or a person planting or cultivating crustaceans or mollusks pursuant to chapters 76-78 of the Parks and Wildlife Code could receive the beneficial ad valorem tax treatmentaffordedby section 23.42 of the Tax Code.
A more difficult issue concerns the applicationof thesebenefits to activities on the seas and the personal property, such as netting and boats, used in such activities. In Attorney General Opinion NW-451 (1982), this office discussed the scope of section 11.161 of

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the Tax Code which permits an individual to exempt from ad valorem taxation "implements of farming or ranching that he owns and uses in the production of farm or ranch products." Therein, this office declared that courts focus on theuse towhich an item is put, Hickman V. Hickman, 234 S.W.Zd 410 (Tex. 1950), declaring "implements of [farmingand ranching]" to include "all implementsused by the farmer in conductinghis farmingoperations,not only those thathe might "se directly, but those used by his tenants and employees." Smith v. McBryde, 173 S.W. 234, 235 (Tex. Civ. App. - San Antonio 1915, no writ). (Emphasisadded). See alsoWollnerv. Darnell, 94 S.W.Zd 1225 (Tex. Civ. App. - Amarillo 1936,no writ) (tenant farmer with rental contractupon 320 acres of land andwho possessed only one tractorand no horses; court held that, since claimantwas unable to farmwithout the tractor, tractor was exempt as an implement of husbandry); Driscoll Foundationv. Nueces County, 445 S.W.Zd 1 (Tex. Civ. App. - Beaumont 1969), writ ref'd n.r.e. per curiam, 450 S.W.Zd 320 (Tex. 1970) (land entitled to special valuation even though land was cultivatedby tenant,rather thanby trustees or employees). Analogously, we conclude that personal property used in mariculture activities is exempt under article VIII, section 19a of the Texas Constitutioneven in an instance in which the claimantdoes not own the bed under the waters Ian which such activities take place or in an instance Jon which the claimantundertakes such activities in waters at the sufferance of the state if and only if such activity irvolves production or cultivation. Mere fishing or harvesting consistingof the captureof animal lifewill not qualify. See, e.g., Attorney GeneralOpinionH-1090 (1977). Accordingly,we conclude that section 23.42 of the Tax Code and article VIII, sections l-d, l-d-l, 19 and 19a of the Texas Constitution,pertain to fish and other forms of aquatic life.
SUMMARY Section 23.42 of theTax Code and articleVIII, sections l-d, l-d-l, 19 and 19a of the Texas Constitution, pertain to fish and other forms of aquatic life. Very trulyyour 

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L-N JIM MATTOX Attorney General of Texas TOM GREEN FirstAssistantAttorneyGeneral

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DAVID R. RICHARDS ExecutiveAssistantAttorney General Preparedby Jim Moellinger AssistantAttorney General
APPROVED: OPINION COMMITTEE Rick Gilpin, Chairman Jon Bible Colin Carl SusanGarrison JimMoellinger Nancy Sutton

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