Ausnnr. TEXAB 78711 

March 22, 1976 

The Honorable Bill Clayton 

Speaker of the House 

State Capitol 

Austin, Texas 78701 

Opinion No. H-799 

Re: Method of assessing 

irrigated agricultural 

land. 

Dear Speaker Clayton: 

You requested our opinion concerning the taxation of 

irrigated land under article VIII, section l-d of the Texas 

Constitution. 

Article VIII, section l-d provides in relevant part: 

(a) All land owned by natural persons 

which is designated for agricultural use 

in accordance with the provisions of this 

Section shall be assessed for all tax 

purposes on the consideration of only those 

factors relative to such agricultural use. 

'Agricultural use' means the raising of 

livestock or growing of crops, fruit, flowers, 

and other productis of the soil under natural 

conditions as a .business venturx profit, 

which business is the primary occupation and 

source of income of the owner. (Emphasis added). 

Specifically, you ask (1) whether the term "natural 

conditions" as used in section l-d obligates a taxing authority 

to~value land that uses irrigation or has irrigation potential 

differently from land that does not have water for irrigation 

and is considered to~be dry land and (2) if irrigated land is 

not valued differently, what definition of "natural conditions" 

would be constitutional under the Fourteenth Amendment to the 

United States Constitution7 . ., 

p. 3370 
The Honorable Bill Clayton - page 2 (H-799) 

Land eligible for assessment under section l-d is taxed 

according to its value, but the value is one determined on 

the assumption t~hat the land can be used only for agricultural 

purposes. p c Real, 466 S.W.Zd 1 (Tex. Civ: App. -- San 

Antonio 197 , writ ref'd.n.r.e.1. The possibility that the 

land may be worth more if used for other purposes, e.g., subdivided for a housing development, may not be considered. 

King v. Real, supra at 7. Such a~scheme of "preferential 

asse6sment"i.s intended to encouraae continued use of land 

for agriculture by providing tax relief to certain owners of 

ranch or farm land who otherwise might sell the land or convert 

it to a more intensive use because of an inability to pay 

higher taxes resulting from land values inoreased by nearby 

residential, industrial, or resort growth. See Klit aard v. 

Gaines, 479 S.W.Zd 765, 760 (Tex. Civ. App. ==--AGZXZ-D72;- 

writ ref'd n.r.e.); Braden, The Texas' Constitution: An Annotated 

and Comparative Analysis, Art. VIII at 15-17 (Preliminary 

Edition 1974); U.S. Dept. of Agriculture, State Programs for 

the Differential Assessment of Farm and Ooen Soace Land (1974): 

Ca u a Ind. School Dist 5i5 S~i4 26 32 (Tex .. 

&% ~-%&9~w~f~~.e.) (Rehearing gra;tedr 

arguments heard January 7, 1976); San Marco6 Consolidated Ind. 

School Dist. v. Nance, 495 S.W.2d m (Tex.Clv. App. -- Au'stin 

-writ reFd n.r.e. at 502 S.W.Zd 694, 1974); Driscoll 

Foundation v. Nueces Count 

Beaumont iSz!& writ re 

f ,d erred: ~;";:~ ‘,.'~~, ~:;;;."pp. -- 

In the dryer regions of Texas, irrigation is a factor 

relative to the use of land for agricultural purposes. See 

Mud Creek Irr. A r. 6 Manuf,. Co. ~-Vivian, 74 Tex. 170,11 

s.w.-nm.-iin9 -7-- 1884). Your first auestion is whether, in 

those regions in‘which irrigation is-important, the term 

"natural conditions" in sectionl-d requires that land with 

water for irrigation be valued for tax purposes as though 

the water is not present. 

The precise meaning of any word must be determined from 

the context in which it is used.: 53 Tex.Jur.2d Statutes 9 

147. In section l-d, the "natural conditions" restriction 

is part of the definition of "agricultural use." In turn, 

"agricultural use" is important both'.ae a qualification for 

preferential assessment under section l-d and as the ba'sis 

for the ao.$ual assessment. Unless land is "designated for 

p. 3371 
The Honorable Bill Clayton. - page 3 (H-799) 

agricultural use”, it is not valued for tax purposes "on the 

consideration of only those factors relative to such agricultural use." In the context of your first question, this 

means that if "natural conditions" requires eligible land to 

be assessed only on its "dry" value, it also requires that 

no land may qualify under section l-d unless "designated" 

for use as dry land. Irrigated land would be ineligible. 

No rational basis for such a distinction is apparent. In 

our opinion, such a construction would be contrary to the 

purpose of article VIII, section l-d, and could create a 

constitutionally questionable classification. See Kahn v. 

Shevin, 416 U.S. 351 (1974). Therefore, in thosedryrezons 

of Texas where irrigation is a factor relative to the use of 

land for agricultural purposes, irrigation or the potential 

for irrigation should be considered in determining the value 

of land under section l-d. 

Having concluded that irrigated land is valued as such 

and not as dry land, we need not answer your second question 

concerning the constitutionality of possible meanings of the 

“natural conditions" restriction. 

S, U M. M A R Y 

Under article VIII, section l-d of the 

Texas Constitution, irrigation or the 

potential for irrigation is a factor 

relative to the agricultural use of land 

and may be considered in determining 

the value of laM,,for purposes of 

taxation. 

Very truly yours, 

p., 3372 
The Honorable Bill Clayton - page 4 (H-799) 

APPROVED: 

-&.: ', 

DAVID M. KENDALL, First Assistant 

Opinion Committee 

jwb 

p. 3373