Reversed and Remanded and Opinion filed March 31, 2015.

In The

Fourteenth Court of Appeals

NO. 14-13-00434-CV

GALVESTON CENTRAL APPRAISAL DISTRICT, Appellant

V.

VALERO REFINING - TEXAS L.P., Appellee

On Appeal from the 56th District Court

Galveston County, Texas

Trial Court Cause No. 11-CV-1442

OPINION

Appellee Valero Refining-Texas L.P. filed a petition for review of its 2011 

property taxes in the trial court, arguing that appellant Galveston Central Appraisal 

District (GCAD) had appraised Valero’s Texas City refinery unequally and that the

refinery’s appraised value should be reduced under section 42.26 of the Tax Code. 

Following a trial, the jury found that portions of the refinery GCAD had appraised 

at approximately $527 million were unequally appraised, and that the “Equal and 
Uniform Value” of those portions was approximately $337 million. The trial court 

rendered judgment on the verdict, and GCAD brings this appeal. 

GCAD raises three issues on appeal, but we need only reach the first two. In 

its first issue, GCAD argues the trial court lacked jurisdiction over Valero’s 

petition for review because Valero did not challenge the appraised value of the 

refinery as a whole and also did not state the amount of taxes it proposed to pay. 

In its second issue, GCAD asserts that legally and factually insufficient evidence

supports the jury’s determination of the equal and uniform value of Valero’s 

refinery. 

Although we conclude the trial court had jurisdiction over Valero’s petition, 

we agree with GCAD that the evidence is legally insufficient to support the jury’s 

equal and uniform valuation of Valero’s refinery. Because there is some evidence 

of unequal appraisal, we reverse the judgment and remand for a new trial. 

BACKGROUND

A. GCAD’s appraisal and Valero’s appeal

Valero owns the refinery located at 1301 Loop 197 South, Texas City, 

Galveston County, Texas. As part of its responsibility to appraise all property in 

Galveston County, GCAD assigned numerous separate account numbers to 

component parts of the Valero refinery.1

 GCAD, as it is required to do, prepared a 

2011 appraisal of the refinery, valuing it at $1,046,406,150.

1 The record is unclear on the exact number of accounts GCAD assigned to the Valero 

refinery. Valero exhibit 4, prepared by Hugh Landrum, the appraiser retained by GCAD to 

perform its annual industrial appraisals, lists ten account numbers for the Valero refinery. 

During his trial testimony, however, Landrum admitted he excluded certain accounts from his 

appraisal. Valero trial exhibit 18 indicates the Valero refinery had twelve account numbers. 

Finally, Valero’s trial counsel represented to the trial court that there were fifteen account 

numbers assigned to the refinery. Valero’s expert witnesses did not address this inconsistency or 

offer any explanation for not including all accounts associated with the refinery in their equaland-uniform analysis. 

2

 
Valero protested the appraised value before the Galveston County Appraisal 

Review Board (ARB). The record is not clear regarding whether all or only some 

account numbers were included in this protest. The ARB granted Valero some 

relief and issued orders reducing the appraised value of the refinery. Valero then 

appealed the ARB’s orders by filing a petition for review in district court. See Tex. 

Tax Code Ann. §§ 42.01, 42.21 (West 2008). In its petition, Valero alleged that 

(1) the 2011 values set by the ARB for five of the accounts associated with the 

refinery were appraised over their market values; and (2) the values were also 

appraised in a manner that was neither equal nor uniform. See Tex. Tax Code 

Ann. §§ 42.25–42.26. 

Valero later amended its petition to drop the market-value challenge. This 

left only Valero’s claim that the refinery was not appraised equally with 

comparable properties. In order to proceed with its appeal, Valero paid the full 

amount of taxes due on the refinery at the value that had been certified by the 

ARB. See Tex. Tax Code Ann. § 42.08(b)(2).

B. The trial court rejects GCAD’s jurisdictional challenges

Prior to trial, GCAD filed a plea to the jurisdiction asking the trial court to 

dismiss Valero’s appeal for failure to state the amount of taxes it proposes to pay, 

which GCAD argued was a jurisdictional requirement. See Tex. Tax Code Ann. 

§ 42.08(b–1) (West 2008). The trial court denied the plea.

On the first day of trial, Valero sought leave to amend its petition to drop its 

challenge to the appraised value of two accounts: R364374 for TNRCC pollution 

control equipment, and R234000 for personal property and inventory.2

 The 

2 GCAD’s only objection to the amended petition was that it was contradictory. The 

record indicates Valero revised the amended petition in response to that objection and GCAD 

lodged no further objections.

3

 
remaining three accounts being challenged were: R293410 for process units and 

various support facilities, R293411 for port tank facilities, and R422670 for crude 

oil tank facilities. The trial court granted Valero leave to file the amended petition. 

GCAD then moved to dismiss Valero’s appeal again. GCAD argued that 

once Valero amended its petition to remove the two account numbers, there was no 

longer a justiciable issue in the case because Valero was required to challenge all 

account numbers in its appeal. The trial court denied GCAD’s motion, and the 

case proceeded to trial.

C. Evidence regarding the three Galveston County refineries

The evidence at trial showed that there were two other refineries in 

Galveston County in 2011, one owned by BP Products (NA), Inc. and the other 

owned by Marathon Petroleum Company. Valero took the position that the 

disputed portions of its refinery were comparable to similar portions of the BP and 

Marathon refineries. Valero also asserted that when the appraised values of these 

portions of the BP and Marathon refineries were appropriately adjusted, the 

median of the adjusted values was less than the appraised values of the equivalent 

portions of Valero’s refinery. Thus, contended Valero, the appraised values of its 

portions should be reduced to the median. See Tex. Tax Code Ann. § 42.26(b). 

Much of the trial testimony focused on differences in the three refineries, the 

appropriate adjustments to be made as a result, and the appropriateness of—and 

methodology for—comparing the adjusted values of the refineries. Although it 

was undisputed at trial that not all refineries are the same, there was agreement that 

the three Galveston County refineries share certain characteristics. These include: 

(1) each refinery sits on land; (2) each processes crude oil and produces fuel oils 

and other petrochemical products; (3) each has facilities for storing crude oil, feed 

stocks used in the refining process, and finished products prior to sale; (4) each has

4
access to utilities, pipelines, and port facilities; and (5) each has support facilities 

within the refinery grounds such as warehouses for spare parts and other 

repair/maintenance supplies, functioning maintenance shops and laboratories, 

administration buildings, and personal property suitable for a functioning complex 

industrial operation. Each refinery also has pollution control equipment mandated 

by the federal government or the Texas Commission on Environmental Quality

(TCEQ).

3

 Pollution control equipment can be exempted from ad valorem taxation 

by the TCEQ, but it was undisputed at trial that none of the three refineries’ 

pollution control equipment was fully exempt from taxation. It was also 

undisputed that Valero received a notice of market value for its pollution control 

equipment. 

Regarding differences among the refineries, the evidence showed that 

Valero’s refinery is a heavy-conversion refinery that contains a coker process unit. 

A heavy-conversion refinery such as Valero’s produces various oil-based products,

and in the refining process it uses up the oil completely until the only thing left is a 

residual solid called coke. Valero’s refinery produces gasoline, diesel, jet fuel, 

kerosene, and naphtha, among other products. Valero’s refinery has a capacity to 

process approximately 258,000 barrels of crude oil per stream day through its 

crude unit. Once the crude oil enters the refinery, it is initially processed through 

the crude unit. The cuts or fractions produced in the crude unit are then sent 

through other processing units in the refinery to create finished products. Valero’s 

refinery has a large number of those processing units.

BP’s refinery, like Valero’s, is a heavy-conversion refinery with a coker 

unit. The BP refinery is far larger than the Valero refinery, as its crude unit has the 

3 The Texas Commission on Environmental Quality was formerly known as the Texas 

Natural Resources and Conservation Commission or TNRCC. 

5

 
capacity to process approximately 475,000 barrels of crude oil per stream day. In 

addition, the BP refinery has many processing units used to produce various 

finished products.

Marathon’s refinery is the smallest and least complex of the three refineries. 

It has the capacity to process 80,000 barrels of crude oil per stream day.

Marathon’s refinery is considered a medium-conversion refinery. Although the 

Marathon refinery possesses many of the same processing units as its larger 

neighbors, it has a smaller total number of processing units than either of the other 

two refineries. Marathon also does not have a coker unit. Finally, Marathon’s 

refinery does not contain a process unit for removing sulfur from fuel products. As 

a result, the products processed at Marathon’s refinery cannot be sold directly in 

the United States. Instead, Marathon must send the refinery’s finished products to 

another Marathon refinery to produce fuel that can be sold in the United States.

D. Evidence regarding unequal appraisal 

Roy Martin, the vice president in charge of Valero’s ad valorem tax 

department, testified during the trial. Martin testified that Valero believed the total 

value of its Texas City refinery should be based only on the value of the refinery’s 

process units, though he did not explain the basis for this belief. Martin explained 

that, as a result of this belief, Valero did not appeal the appraised value of the 

pollution control equipment and refinery personal property. Martin conceded,

however, that these accounts formed part of the total value of the refinery and 

would be included in a sale if Valero decided to sell the refinery. Martin also 

recognized that GCAD is required to value all property in Galveston County and 

report those values to the Texas Comptroller.

Peter Killen and John Coyle were the appraisers retained by Valero. They 

both testified during the trial about the methodology they used to arrive at their 

6
ultimate conclusion that GCAD had appraised the Valero refinery at a higher value 

than the other two comparable properties—the BP and Marathon refineries. The 

Valero experts reached their conclusion by using Equivalent Distillation Capacity 

(EDC) to compare the three refineries. According to Coyle, this methodology 

minimized the number of adjustments necessary to make the three properties 

comparable for purposes of an equal-and-uniform challenge. 

Valero’s experts testified that they calculated the EDC for each refinery by 

starting with the Nelson Complexity Factor for each processing unit in the refinery,

and then multiplied that number by the capacity of that unit.4

 Using this method, 

they determined that, as of January 1, 2011, Valero’s EDC was 2,940,579, BP’s 

was 7,140,883, and Marathon’s was 685,267.

In their next step, Valero’s experts divided the total appraised value of the 

portions of Valero’s refinery being challenged (and similar portions of the other 

refineries)5 by the refinery’s EDC to arrive “at an expression of the appraised value 

in terms of dollars per EDC.” Valero’s experts did not include the appraised value 

of any refinery’s pollution control equipment in its total appraised value even 

though Killen testified that pollution control equipment (1) is part of each refinery,

(2) would be included in a market-value appraisal, and (3) would be included in a 

sale of the facility. Using the above calculation, Valero’s experts determined that 

Valero’s refinery portions had a value of $179 per EDC, BP’s had a value of $146 

per EDC, and Marathon’s had a value of $83 per EDC. The experts then 

determined that the median value of the BP and Marathon properties was $115 per 

4 The Nelson Complexity Factor is an approximation of the relative cost of a process unit 

when compared with the cost of a similarly-sized crude processing unit. Killen explained that 

Nelson Complexity Factors are published annually in the Oil & Gas Journal.

5 The experts’ report stated that they considered “all of the taxable operating 

improvements at each refinery” while excluding land, personal property, and pollution control 

equipment.

7

 
EDC.6

 Finally, Valero’s experts multiplied the median figure of $115 per EDC by 

Valero’s EDC (2,940,579) to reach an equal and uniform appraised value of 

$337,415,593 for the challenged portions of Valero’s refinery. This represented a 

reduction of nearly $190 million from the 2011 appraised value of $526,796,990.

When asked on cross-examination, Killen offered no explanation for 

Valero’s last-minute decision to drop the pollution control equipment from the 

appeal. John Coyle was Valero’s second appraisal expert, and he collaborated with 

Killen in the preparation of Valero’s proposed equalized appraisal value for the 

refinery. Coyle was also asked during cross-examination for an explanation of 

Valero’s decision to drop the pollution control equipment. Coyle’s only 

explanation was that he and Killen performed two different calculations based on 

the information they were provided to show the “effect of treating the pollution 

control equipment, the exempt pollution control equipment as part of the problem 

as opposed to excluding it from the problem.” Coyle denied they had excluded the 

pollution control equipment from their calculations to skew the results in favor of 

Valero.

Hugh Landrum, GCAD’s industrial appraiser, also testified during the trial. 

Landrum testified that comparing the EDCs of the refineries is not a complete 

comparison of their values because EDC was not designed to be a representation of 

market value. Instead, Landrum testified it compares construction costs to build 

refinery units. Landrum also opined that an equal-and-uniform appraisal 

calculation for a refinery must include the pollution control equipment because it is 

an integral part of the overall refinery, which cannot operate without the 

equipment. 

6 They also performed the same calculation using appraised values that included pollution 

control equipment. In that calculation, the median was $231 per EDC, yielding an equalized 

value for the Valero refinery of $678,108,731.

8

 
James Clarkson testified as GCAD’s appraisal expert. Clarkson, like 

Landrum, testified that an equal-and-uniform comparison must include the value of 

each refinery’s pollution control equipment because each refinery must have that 

equipment in order to operate. Clarkson also opined that two refineries represent

an insufficient number of comparable refineries to conduct an unequal appraisal 

analysis. He then stated that he conducted that analysis anyway because that was 

his assignment. After conducting his own equal-and-uniform analysis of the three 

refineries, Clarkson opined that Valero’s refinery was appraised below the median 

value of the two other Galveston refineries. 

E. The verdict and judgment

At the conclusion of the evidence, the jury found that the challenged 

portions of the Valero refinery had been unequally appraised in 2011. It then 

found that the equal and uniform value of those portions was $337,415,593. The 

parties agreed to submit the issue of attorneys’ fees to the trial court in the event

the jury found in favor of Valero. Following a hearing on fees, the trial court 

signed a final judgment declaring that the 2011 total appraised value for the three 

challenged accounts was $337,415,593. It also awarded Valero attorneys’ fees of 

$100,000. This appeal followed.

ANALYSIS

I. The trial court had jurisdiction over Valero’s tax appeal.

In its first issue, GCAD argues that the trial court lacked jurisdiction over 

Valero’s tax appeal. GCAD makes two separate arguments within its jurisdictional 

challenge. First, it contends the trial court lost jurisdiction when Valero dropped 

its challenge to the ARB’s valuation of the pollution control equipment account. 

In GCAD’s view, as a result of this decision, Valero failed to appeal the appraised 

9
value of the whole property as required by the Texas Tax Code, thereby depriving 

the trial court of jurisdiction. See Tex. Tax Code Ann. § 42.26 (West 2008). In its 

second argument, GCAD contends that the trial court did not have jurisdiction 

because Valero failed to meet the statutory requirement of stating the amount of 

taxes it proposed to pay at the time it filed its tax appeal in the trial court. See id.

§ 42.08(b–1).

A. Standard of review

We review a trial court’s ruling on a plea to the jurisdiction de novo. 

Woodway Drive, L.L.C. v. Harris Cnty. Appraisal Dist., 311 S.W.3d 649, 651 

(Tex. App.—Houston [14th Dist.] 2010, no pet.). During this review, we construe 

the pleadings liberally in favor of the pleader and look to the pleader’s intent to 

determine whether the facts alleged affirmatively demonstrate the trial court’s 

jurisdiction to hear the case. Id. A defendant may prevail on a plea to the 

jurisdiction by demonstrating that even if all of the plaintiff’s pleaded allegations 

are true, an incurable jurisdictional defect remains on the face of the pleadings that 

deprives the trial court of subject-matter jurisdiction. Id. at 652. 

When construing a statute, a reviewing court looks to the plain and common 

meaning of the statute’s terms. Tex. Dept. of Transp. v. City of Sunset Valley, 146 

S.W.3d 637, 642 (Tex. 2004). We read a statute as a whole and not just isolated 

portions. Id. “If the statutory language is unambiguous, we must interpret it 

according to its terms, giving meaning to the language consistent with other 

provisions in the statute.” Id., see also Tex. Gov’t Code Ann. § 311.011(a) (West 

2013) (“Words and phrases shall be read in context and construed according to the 

rules of grammar and common usage.”).

10
B. The trial court had jurisdiction because it timely petitioned for 

review of ARB orders, and Valero’s amended petition alleged that 

the refinery was unequally appraised.

The Tax Code provides that a property owner is entitled to appeal a final

order of the appraisal review board determining the owner’s tax protest. Tex. Tax 

Code Ann. § 42.01(a), 42.21(a) (West 2008 & Supp. 2014). It is undisputed that 

Valero owns the refinery located at 1301 Loop 197 South in Texas City, Galveston 

County, Texas, that it protested the appraised value of at least some property 

accounts within the refinery, and that it timely appealed the ARB’s orders 

regarding some of the accounts by filing a petition for review in the trial court. 

GCAD asserts that the trial court nevertheless lacked jurisdiction because 

Valero dropped its challenge to the appraised value of the account containing the 

refinery’s pollution control equipment on the first day of trial, and it failed to 

challenge the value of other accounts within the refinery (such as the land) at all. 

In support of this argument, GCAD cites section 42.26 of the Tax Code, which 

provides:

The district court shall grant relief on the ground that a property is 

appraised unequally if . . . (3) the appraised value of the property 

exceeds the median appraised value of a reasonable number of 

comparable properties appropriately adjusted.

See id. § 42.26(a)(3). In GCAD’s view, Valero is attempting to appeal only the 

appraised value of some component parts of the refinery “property,” a practice 

GCAD contends was held improper in Covert v. Williamson Cent. Appraisal Dist., 

241 S.W.3d 655, 658–60 (Tex. App.—Austin 2007, pet. denied). 

Valero responds by asserting that each part of the refinery at issue here was 

appraised in a separate property tax account, and its protest of the value of those 

accounts was determined by ARB orders. Valero points out that it is “entitled to 

11
appeal . . . an [ARB] order” determining its protest, see Tex. Tax Code Ann. 

§ 42.01(a), and it argues that nothing in the Code required it to protest the value of 

all property accounts in the refinery, secure adverse orders, and appeal all of those 

orders before the trial court could acquire jurisdiction. 

Although we agree with GCAD that Covert prohibits piecemeal challenges 

to the value of an appraised property, we also agree with Valero that on these facts,

its amended petition gave the trial court jurisdiction over this appeal. In Covert, 

the owners of three properties improved with car dealerships, each of which was 

appraised in a single tax account that valued the land as well as the improvements, 

attempted to appeal the valuation of the “land portion only” of each property. 241 

S.W.3d at 657. The appraisal district did not challenge the trial court’s jurisdiction 

but instead filed special exceptions, contending that the owners failed to state a 

cause of action because the Tax Code provides no remedy for unequal appraisal of 

only a portion of an appraised property. Id. The trial court dismissed the case and 

the Austin Court of Appeals affirmed. Focusing on what property had been 

appraised—there, the land and improvements together (id. at 658–59)—the court 

of appeals held “that a taxpayer challenging the equal and uniform assessment of 

an improved property under section 42.26 must allege that the overall appraised 

value of the property is unequal.” Id. at 661 (emphasis added). The court 

explained that an owner may allege and introduce evidence that only certain parts 

of its property were valued unequally, but it cannot prevail in its challenge unless it 

can show that the value of the entire appraised property is not equal or uniform as a 

result. Id. at 659 & n.6.

In sum, each dealership in Covert was appraised in a single property tax 

account with a single value, and the court held that the owners’ unequal appraisal 

challenge was improperly directed to a portion of that value only. The parties 

12
dispute whether Covert applies when, as here, a facility is appraised in multiple 

property tax accounts and the owner’s unequal appraisal challenge is directed to 

the entire value of certain accounts only. Cf. Matagorda County Appraisal Dist. v. 

Coastal Liquids Partners, L.P., 165 S.W.3d 329, 332–34 (Tex. 2005) (holding 

different aspects of real property that are part of same tract can be taxed separately 

under certain circumstances without resulting in double taxation); Tex. Att’y Gen. 

Op. No. GA-0790 (2010) (stating that assignment of land and improvements, 

whether separate or combined, to accounts is an administrative decision made by 

the chief appraiser). We need not decide that issue today, however, for two 

reasons.

First, Covert does not support GCAD’s position that the trial court lacked 

jurisdiction. Covert did not address jurisdiction; it held, on special exceptions, that 

a taxpayer “cannot prevail” on an unequal appraisal claim under section 42.26 

unless it proves that the value of the appraised property is not equal or uniform. 

241 S.W.3d at 659. This holding echoes the language of section 42.26, which 

addresses when a court “shall grant relief on the ground that a property is appraised 

unequally.” Tex. Tax Code Ann. § 42.26(a). That section does not address what 

an owner may appeal or how it may invoke the trial court’s jurisdiction over an 

appeal—subjects covered by sections 42.01 and 42.21. See Dubai Petrol. Co. v. 

Kazi, 12 S.W.3d 71, 76–77 (Tex. 2000) (explaining distinction between right of 

plaintiff to relief and jurisdiction of court to afford it); Reliance Ins. Co. v. Denton 

Cent. Appraisal Dist., 999 S.W.2d 626, 629 (Tex. App.—Fort Worth 1999, no pet.) 

(holding trial court did not lack jurisdiction to consider unequal appraisal challenge 

to value of land portion of property consisting of both land and improvements, and 

reasoning that although failure to prove unequal appraisal of property as a whole 

would generally prevent owner from prevailing, it would not deprive court of 

13
jurisdiction). As discussed above, it is undisputed that Valero filed a timely 

petition seeking review of the ARB’s orders in compliance with sections 42.01 and 

42.21, which we hold was sufficient to vest the trial court with jurisdiction.

Second, even if Covert were a jurisdictional limitation that foreclosed

unequal-appraisal challenges to the value of only some property tax accounts 

within a multi-account facility, it would not require dismissal here because Valero 

alleged that the overall appraised value of the entire refinery is unequal. In its 

Third Amended Petition, Valero described the property at issue as consisting of 

“the real and business personal property located at 1301 Loop 197 S in Galveston 

County, Texas,” “and/or” “the economic unit and any improvements, 

appurtenances, personal property and fixtures normally included in this kind of 

property.” Although the amended petition also specifically listed three account 

numbers, Valero alleged that the “appraised value of the PROPERTY exceeds the 

median appraised value of a reasonable number of comparable properties 

appropriately adjusted” in violation of section 42.26 of the Texas Tax Code. 

Because Valero’s amended petition alleged that the entire refinery was unequally 

appraised, the trial court had jurisdiction over the dispute and did not err when it 

denied GCAD’s motion to dismiss based on Covert. See Covert, 241 S.W.3d at 

659 & n.6; see also Matagorda County Appraisal Dist., 165 S.W.3d at 335 (stating 

that property description is sufficient when property sought to be assessed may be 

identified from the description given).

7

7 GCAD also argues on appeal that the trial court abused its discretion by allowing 

Valero to amend its petition to drop its challenge to the pollution control equipment account 

because the amendment reshaped the trial and operated as a surprise. See Tex. R. Civ. P. 63. 

Valero responds that GCAD failed to object to the amendment and has not shown surprise. We 

need not decide this issue because the greatest relief available for an improper amendment would 

be a new trial, see Stevenson v. Koutzarov, 795 S.W.2d 313, 321, 323 (Tex. App.—Houston [1st 

Dist.] 1990, writ denied), and we are ordering a new trial on other grounds as explained below. 

14

 
C. The trial court did not err when it refused to dismiss Valero’s tax 

appeal pursuant to section 42.08 of the Texas Tax Code.

GCAD next asserts that the trial court erred in refusing to dismiss Valero’s 

tax appeal because Valero failed to provide with its original petition a written 

statement of the amount of taxes it proposed to pay as required by section 42.08(b1) of the Tax Code. See Tex. Tax Code Ann. § 42.08(b-1) (West 2008).8 We 

disagree that a statement was required on these facts. 

Section 42.08(b) requires a property owner, to avoid forfeiture of his right to 

obtain judicial review, to pay the lesser of: (1) the amount of taxes not in dispute,

or (2) the current tax liability. See Tex. Tax Code Ann. § 42.08(b)(1)–(2) (West 

2008);9 U. Lawrence Boze’ & Assocs., P.C. v. Harris County Appraisal Dist., 368 

S.W.3d 17, 27–28 (Tex. App.—Houston [1st Dist.] 2011, no pet.). This payment 

is not due immediately upon filing the petition for review, but before the 

delinquency date for the tax year. Id. If the payment is not timely made, then 

(with certain exceptions) “the property owner forfeits its right to proceed to a final 

determination of the appeal” and the trial court loses subject-matter jurisdiction. 

Tex. Tax Code Ann. § 42.08(b); U. Lawrence Boze’ & Assocs., 368 S.W.3d at 23, 

27, 31.

The statement requirement of subsection (b–1), on which GCAD relies,

“applies only to an appeal in which the property owner elects to pay” the amount 

of taxes not in dispute under subsection (b)(1). Tex. Tax Code Ann. § 42.08(b–1) 

(West 2008). In this case, however, Valero paid the current tax liability in full 

8 After the trial in this case, the Legislature amended this section to state expressly that 

“[t]he failure to provide the statement required by this subsection is not a jurisdictional error.” 

See Tex. Tax Code Ann. § 42.08(b-1) (West Supp. 2014) (amendment effective June 14, 2013 

while trial court’s judgment was signed March 20, 2013).

9 The Legislature’s recent amendment also gives the taxpayer the option of paying the 

previous year’s tax liability. See Tex. Tax Code Ann. § 42.08(b)(3) (West Supp. 2014).

15

 
before the delinquency date in compliance with subsection (b)(2). Accordingly, 

the trial court correctly concluded that it did not lose subject-matter jurisdiction.

Because Valero complied with the jurisdictional requirement to maintain its 

tax protest appeal, we reject GCAD’s second jurisdictional argument. Having 

rejected both arguments raised in GCAD’s first issue, we overrule that issue.

II. The evidence is legally insufficient to support the jury’s finding of equal 

and uniform value.

In its second issue, GCAD contends the evidence is legally and factually 

insufficient to support the jury’s finding of the equal and uniform value of the 

challenged portions of the refinery. GCAD makes two distinct arguments: (1) 

Valero did not use a reasonable number of comparable properties in its equal-anduniform analysis because the Marathon refinery is not a comparable property; and 

(2) the Valero experts’ equal-and-uniform analysis is conclusory because they 

offered no explanation for excluding portions of the refineries when applying their 

dollars-per-EDC adjustment method.

10 We address each argument in turn.

A. Standard of review

When an appellant attacks the legal sufficiency of an adverse finding on an 

issue on which it did not have the burden of proof, the appellant must demonstrate 

on appeal that there is no evidence to support the adverse finding. Univ. Gen. 

10 On appeal, GCAD also argues that the opinions of the Valero experts are not reliable 

because their methodology did not meet the statutory requirement that, in order to demonstrate 

an unequal appraisal, a property owner must find comparable properties and adjust the appraised 

values of those properties to arrive at a median appraised value. In the trial court, however, 

GCAD did not challenge the reliability of the Valero experts’ methodology of using dollars per 

EDC to determine the adjusted appraised values of refineries. Because GCAD failed to preserve 

a reliability challenge for our review, we do not reach this argument and express no opinion on 

the reliability of the Valero experts’ methodology, which the parties are free to address on 

remand. See Tex. R. App. P. 33.1; Harris County Appraisal Dist. v. Kempwood Plaza Ltd., 186 

S.W.3d 155, 161–62 (Tex. App.—Houston [1st Dist.] 2006, no pet.).

16

 
Hosp., L.P. v. Prexus Health Consultants, LLC, 403 S.W.3d 547, 550 (Tex. App.—

Houston [14th Dist.] 2013, no pet.). In conducting a legal sufficiency review, we 

must consider the evidence in the light most favorable to the appealed finding and 

indulge every reasonable inference that supports it. Id. at 550–51 (citing City of 

Keller v. Wilson, 168 S.W.3d 802, 821–22 (Tex. 2005)). The evidence is legally 

sufficient if it would enable reasonable and fair-minded people to reach the 

decision under review. Id. at 551. This Court must credit favorable evidence if a 

reasonable trier of fact could, and disregard contrary evidence unless a reasonable 

trier of fact could not. Id. The trier of fact is the sole judge of the witnesses’

credibility and the weight to be given their testimony. Id.

This Court may sustain a legal sufficiency (or no evidence) issue only if the 

record reveals one of the following: (1) the complete absence of evidence of a vital 

fact; (2) the court is barred by rules of law or evidence from giving weight to the 

only evidence offered to prove a vital fact; (3) the evidence offered to prove a vital 

fact is no more than a scintilla; or (4) the evidence established conclusively the 

opposite of the vital fact. Id. Evidence that is so weak as to do no more than 

create a mere surmise or suspicion that the fact exists is less than a scintilla. Id.

A party that preserved a legal sufficiency complaint in the trial court may 

argue on appeal that an expert’s opinion is conclusory, and as a result the evidence 

supporting the jury’s verdict is legally insufficient. Whirlpool Corp. v. Camacho, 

298 S.W.3d 631, 638 (Tex. 2009). In that situation, we independently consider 

whether the evidence at trial would enable reasonable and fair-minded jurors to 

reach the verdict under review. Id. (citing City of Keller, 168 S.W.3d at 827). A 

no-evidence review encompasses the entire record, including contrary evidence 

tending to show the expert opinion is incompetent or unreliable. Id.

17
No objection to the admission of an expert’s opinion is required when the 

expert’s testimony is conclusory and lacks probative value as a result. Coastal 

Transp. Co., Inc. v. Crown Cent. Petroleum Corp., 136 S.W.3d 227, 232 (Tex. 

2004). This principle applies when the expert offers no basis for his opinion or the 

basis offered by the expert provides no support. City of San Antonio v. Pollock, 

284 S.W.3d 809, 818 (Tex. 2009). The supreme court has made it clear that “a 

claim will not stand or fall on the mere ipse dixit of a credentialed witness.” Id. 

B. There is legally sufficient evidence that Marathon is a comparable 

property.

GCAD initially contends that the evidence is legally insufficient to support 

the judgment because Valero’s experts used a non-comparable property—the 

Marathon refinery—in their equal-and-uniform analysis.11 We disagree.

Section 42.26(a)(3) of the Texas Tax Code provides that a district court shall 

grant relief on the ground that a property is appraised unequally if “the appraised 

value of the property exceeds the median appraised value of a reasonable number 

of comparable properties appropriately adjusted.” Tex. Tax Code Ann. 

§ 42.26(a)(3). In GCAD’s view, Valero failed to introduce legally sufficient 

evidence that the Marathon refinery is a comparable property, and its exclusion 

from the analysis leaves Valero without a reasonable number of comparable 

properties as required by the statute.

Neither party cites authority addressing how we are to review GCAD’s 

challenge. Many courts analyze arguments that a property is not comparable as 

11 Although we ultimately agree with GCAD’s second legal sufficiency argument and 

hold that it entitles GCAD to a new trial (see Part II.C. below), we address this first argument 

because GCAD contends it would support the greater relief of judgment in GCAD’s favor and 

because it is likely to arise again on remand. See Garza v. Cantu, 431 S.W.3d 96, 107 n.7 (Tex. 

App.—Houston [14th Dist.] 2013, pet. denied).

18

 
challenges to the admission of evidence regarding the property’s value or to the 

reliability of expert testimony based on that value, holding that trial courts have 

considerable discretion in making the fact-intensive determination whether 

properties are similar enough to admit the evidence, and that the degree of 

comparability goes to the weight of the evidence.

12 These holdings have particular 

force in this context because a very demanding threshold standard of comparability 

could prevent owners of complex industrial properties from bringing an equal-anduniform challenge at all—a result at odds with the broad construction we are to

give section 42.26 as a remedial statute.

13 Moreover, GCAD did not ask the trial 

court to make a comparability determination by objecting to the admission of 

evidence regarding the Marathon refinery or to the reliability of the expert 

testimony offered by Valero.

Even if GCAD could nevertheless raise a separate challenge to the legal 

sufficiency of the evidence regarding Marathon’s comparability, we conclude that 

such a challenge fails because there is more than a scintilla of evidence that the 

Valero and Marathon refineries are sufficiently comparable. In support of its 

position, GCAD points to evidence that Marathon’s refinery has a much smaller 

refining capacity and lacks a coker unit as well as other processing units that both 

Valero and BP possess. Undisputed evidence also showed, however, that no two 

12 E.g., Harris County Appraisal Dist. v. Houston 8th Wonder Prop., L.P., 395 S.W.3d 

245, 256 (Tex. App.—Houston [1st Dist.] 2012, pet. denied); Collin County v. Hixon Family 

P’ship, Ltd., 365 S.W.3d 860, 872 (Tex. App.—Dallas 2012, pet. denied); City of Dallas v. 

Anderson, 570 S.W.2d 62, 66–67 (Tex. Civ. App.—Dallas 1978, writ ref’d n.r.e.); Stewart v. 

State, 453 S.W.2d 524, 526–27 (Tex. Civ. App.—Beaumont 1970, writ ref’d n.r.e.).

13 Harris County Appraisal Dist. v. United Investors Realty Trust, 47 S.W.3d 648, 652 

(Tex. App.—Houston [14th Dist.] 2001, pet. denied) (stating that remedial statutes, such as 

section 42.26 of the Tax Code, should not be given a construction that would defeat the purpose 

for which they were enacted by the Legislature); see also Hunter v. Fort Worth Capital Corp., 

620 S.W.2d 547, 551 (Tex. 1981) (noting cardinal rule of statutory construction that the 

Legislature is never presumed to do a useless or meaningless act).

19

 
refineries are alike, yet the three Galveston County refineries share many 

characteristics. These characteristics include: (1) each sits on land; (2) each 

processes crude oil and produces fuel oils and other petrochemical products; (3) 

each has storage facilities for crude oil, feed stocks used in the refining process, 

and finished products prior to sale; (4) each has access to utilities, pipelines, and 

port facilities; (5) each has pollution control equipment; and (6) each has support 

facilities within the refinery grounds such as warehouses for spare parts and other 

repair/maintenance supplies, functioning maintenance shops and laboratories, 

administration buildings, and personal property suitable for a functioning complex 

industrial operation. In addition, there was conflicting testimony from GCAD’s 

and Valero’s experts regarding whether the refineries are comparable and whether 

appropriate adjustments could be made to determine a median value. 

Having reviewed the record, we conclude there is more than a scintilla of 

evidence that the three refineries are comparable for purposes of an equal-anduniform challenge and the differences pointed out by GCAD can be accounted for 

through a properly conducted adjustment process. See Harris County Appraisal 

Dist. v. United Investors Realty Trust, 47 S.W.3d 648, 653 (Tex. App.—Houston 

[14th Dist.] 2001, pet. denied) (stating only independent analysis required in equaland-uniform challenge is adjusting appraised values to put properties on equal 

footing). We therefore overrule GCAD’s first legal sufficiency argument.14

14 Because we ultimately conclude that the evidence is legally insufficient to support the 

judgment given that Valero’s experts offered no basis for removing the pollution control 

equipment from the equal-and-uniform analysis, we need not reach GCAD’s contention that the 

evidence is factually insufficient to establish that the Marathon refinery is a comparable property. 

See Tex. R. App. P. 47.1. 

20

 
C. There is no evidence to support the jury’s value finding because 

Valero’s experts offered no basis for including some parts of the 

refineries in their valuation analysis while excluding others.

Next, GCAD argues the evidence is legally insufficient to support the jury’s 

finding that the equal and uniform value of the challenged portions of the Valero 

refinery was $337,415,593 because Valero’s experts did not sufficiently explain 

the basis for their calculations supporting that value, rendering their opinions 

conclusory. In particular, GCAD points out that in applying their chosen 

adjustment method of dollars per EDC, Valero’s experts provided no basis for their 

decision to include the appraised dollar value of the three refineries’ non-process 

facilities in the analysis while excluding the value of their pollution control 

equipment—a decision that offered Valero an additional reduction of over $130 

million in the appraised value of the challenged portions of the refinery. Because

we agree that Valero’s experts offered no reason for removing the pollution control 

equipment from the equal-and-uniform analysis other than that Valero had told 

them to do so, we hold that the jury’s finding is not supported by legally sufficient 

evidence. See Pollock, 284 S.W.3d at 818. 

To explain the basis for our conclusion, we begin by reviewing the portions 

of the refineries at issue and the experts’ analysis of their equal and uniform value. 

Valero’s appeal of the ARB’s orders challenged the appraised value of property 

listed in five specific account numbers: (1) R293410 for process units and various 

support facilities (appraised value $520,791,990); (2) R293411 for port tank 

facilities (appraised value $2,125,000); (3) R422670 for crude oil tank facilities 

(appraised value $3,880,000); (4) R364374 for pollution control equipment

(appraised value $233,718,730); and (5) P234000 for personal property and 

inventory (appraised value $2,934,000). The total appraised value of these five 

accounts was $763,449,720.

21
On the first day of trial, the court granted Valero leave to file an amended 

petition dropping its valuation challenge to two of the accounts: pollution control 

equipment and personal property and inventory.

15 Nevertheless, Valero’s experts 

prepared two equal-and-uniform analyses of the appraised value of the three 

refineries, one that included and another that excluded the appraised value of each 

refinery’s pollution control equipment. With the pollution control equipment 

included in the analysis, the ARB’s 2011 appraised value of the Valero refinery 

was $760,515,720. When the pollution control equipment was removed, the 

appraised value was $526,796,990, a reduction of $233,718,730. 

This reduction had a substantial effect on the experts’ calculation of dollars 

of appraised value per EDC—the method they used to make the adjustments 

necessary to determine a median appraised value. As explained above, EDC 

measures the capacity and complexity of a refinery’s process units (which, in 

Valero’s case, were appraised in account R293410). Valero’s experts added 

together the appraised dollar values of certain property accounts within each

refinery and divided that total value by the refinery’s EDC to determine a dollarsper-EDC value, which they then compared across refineries to arrive at a median 

value. This median value was $231 per EDC when the experts included the 

appraised value of each refinery’s pollution control equipment as well as its

process units and facilities accounts, but $115 per EDC when pollution control 

equipment was excluded. As a result, Valero’s experts opined that the equal and 

uniform value of the three property accounts still being challenged by Valero—the 

15 Although GCAD disputed the dropping of the pollution control equipment account 

from the lawsuit, it did not challenge in the trial court, and has not challenged on appeal, the 

dropping of account P234000 from the lawsuit. None of the experts included account P234000 

in their equal-and-uniform comparisons. We therefore do not address the appropriateness of the 

experts’ decisions to exclude the account from their valuation opinions. See Kempwood Plaza 

Ltd., 186 S.W.3d at 161. 

22

 
process units and other facilities—was $469,714,996 when the pollution control 

equipment was included in the comparative analysis, but $337,415,593 when it 

was excluded. The jury chose the lower figure.

The experts did not explain, however, how their chosen adjustment method 

of dollars per EDC supported excluding the pollution control equipment from the 

equal-and-uniform analysis. Undisputed evidence showed that: (1) all three 

refineries had pollution control equipment with appraised values of many millions 

of dollars; (2) pollution control equipment is required to produce product that can 

be sold in the United States; (3) pollution control equipment contributes to the 

value of each refinery; and (4) pollution control equipment would be included in 

the sale if a refinery is sold. Faced with this evidence that pollution control 

equipment is an essential part of each refinery, Valero’s experts were required to 

explain why the value of the pollution control equipment should or should not have 

been included in their equal-and-uniform analysis. The experts’ exclusion of the 

equipment with no explanation of their basis for doing so—other than that Valero 

told them to—renders their opinions conclusory and unable to support the 

judgment. See Houston Unlimited, Inc. Metal Processing v. Mel Acres Ranch, 443 

S.W.3d 830, 835–38 (Tex. 2014) (holding expert’s testimony constituted legally 

insufficient evidence because she failed to explain whether or why properties she 

used for comparison were similar to subject property, identify other plausible 

causes for differences between properties’ market values, or tie her valuation to 

differences between properties); Pollock, 284 S.W.3d at 818 (holding that if expert 

provides no basis for his opinion or stated basis for the opinion is conclusory, it is 

not probative evidence even if there was no objection).

16

16 Cf. Houston 8th Wonder Property L.P., 395 S.W.3d at 255–56 (Tex. App.—Houston 

[1st Dist.] 2012, pet. denied) (holding (1) trial court did not abuse its discretion in admitting 

expert’s opinion on equal and uniform valuation because expert offered adequate explanation for 

23

 
In this Court, Valero suggests that its decision to narrow its appeal in the 

trial court and forgo a challenge to the ARB’s value of the separately-appraised 

pollution control equipment provided a basis for its experts to exclude that value 

from their analysis. We disagree because it is the refinery comparison method 

chosen by Valero’s experts that determines which parts of each refinery must be 

included to produce a reliable calculation of median dollars per EDC, and there is 

no evidence from the experts suggesting that Valero’s pleading decision affects the 

median calculation. When the value of part of a larger property is in dispute, many 

valuation methods consider the larger property in valuing the disputed portion. 

See, e.g., State v. Windham, 837 S.W.2d 73, 76 (Tex. 1992) (holding that when 

parcel condemned is part of larger economic unit of property, value of parcel must 

be calculated with reference to remainder of property, and rejecting argument that 

condemnee has absolute right to designate economic unit). Here, Valero’s experts 

did not address whether dollars per EDC is such a method. Nor can we discern any 

basis in the record for concluding that the experts’ method provides a basis for 

excluding pollution control equipment. We note that EDC is calculated based on

the refinery’s process units, and pollution control equipment is not a process unit. 

But the other tank facilities are likewise not process units, yet the experts included 

their value in the analysis. Accordingly, we conclude that neither Valero’s 

amended petition nor the experts’ chosen method provides a basis for excluding 

the value of Valero’s pollution control equipment from the equal-and-uniform 

analysis.

Valero also asserts that the equipment was properly excluded because each 

refinery’s pollution control equipment differs from the equipment found in the 

other two refineries. We conclude that alleged differences in the type and 

decisions made on adjustments to values of comparable properties, and (2) evidence was legally 

sufficient to support the judgment as a result).

24

 
allocation of the pollution control equipment at each refinery do not provide a basis 

to exclude pollution control equipment from the equal-and-uniform analysis, 

however, because any differences that may exist can be addressed through the 

adjustment process. United Investors Realty Trust, 47 S.W.3d at 653. Moreover, 

the allegation that the appraised value of the pollution control equipment at one or 

more refineries may not match its market value is (if true) a ground for an 

excessive-appraisal challenge, not an unequal-appraisal challenge. Compare Tex. 

Tax Code Ann. § 42.25 with id. § 42.26.

Finally, Valero points out that it was undisputed at trial that some portion of 

each refinery’s pollution control equipment is ultimately exempt from taxation. 

We conclude that this exemption likewise provides no basis for excluding pollution 

control equipment from the equal-and-uniform analysis. GCAD is charged with 

determining the appraised value of property in its district, and it is the appraised 

value—not the taxable value—that Valero has challenged as unequal.

17 

Because we have determined that Valero’s experts offered no basis for 

excluding an integral part of each refinery from their equal and uniform valuation, 

we conclude the evidence is legally insufficient to support the jury’s determination 

17 See Tex. Tax Code Ann. §§ 1.04 (8), (9), (10), (14) (defining “appraised value,” 

“assessed value,” “taxable value,” and “assessor”), 6.01 (establishing appraisal district in each 

county and assigning it duty to appraise property in district for ad valorem tax purposes), 26.01 

(requiring chief appraiser to prepare and certify appraisal roll for all property taxable in district), 

31.01 (requiring tax assessor to state in each tax bill the appraised value, assessed value, and 

taxable value of the property), 42.26(a)(3) (authorizing district court to grant relief to property 

owner “on the ground that a property is appraised unequally” under certain circumstances) (West 

2008); see also Benson Chevrolet, Inc. v. Bexar County Appraisal Dist., 242 S.W.3d 54, 56 (Tex. 

App.—San Antonio 2007, no pet.) (“If no protest or challenge is filed by the property owner 

regarding the appraised value established by the appraisal district, the appraisal district certifies 

the value to the tax assessor-collector and the tax assessor-collector issues tax statements and 

collects taxes.”); General Motors Acceptance Corp. v. Harris County Appraisal Dist., 899 

S.W.2d 821, 823 (Tex. App.—Houston [14th Dist.] 1995, no writ) (stating that appraisal district 

lists property and its appraised market value). 

25

 
that the 2011 equal and uniform value of the Valero refinery was $337,415,593. 

We therefore sustain GCAD’s second issue on appeal.

Normally, we reverse and render judgment in favor of the appellant when we 

sustain a legal sufficiency point. Guevara v. Ferrer, 247 S.W.3d 662, 670 (Tex. 

2007). We conclude that is not the appropriate outcome here because there is some 

evidence in the record that would support an equal and uniform valuation of the 

challenged portions of the Valero refinery that is lower than the valuation ordered 

by the ARB. In this situation, we may either remand the case to the trial court for a 

new trial or suggest a remittitur. Garza v. Cantu, 431 S.W.3d 96, 108 (Tex. 

App.—Houston [14th Dist.] 2013, pet. denied) (citing Guevara, 247 S.W.3d at 

670). Here, Valero’s experts performed a separate equal-and-uniform calculation 

that included each refinery’s pollution control equipment account. They did not, 

however, include all accounts associated with each refinery in that calculation, nor 

did they explain why it was acceptable under a dollars-per-EDC method to include 

certain accounts and exclude others. We conclude, therefore, that the record 

contains insufficient evidence to calculate an accurate remittitur. Accordingly, we 

reverse the trial court’s judgment and remand this case to the trial court for a new 

trial. See Tony Gullo Motors I, L.P. v. Chapa, 212 S.W.3d 299, 314 (Tex. 2006) 

(holding improperly segregated awards of damages or fees are some evidence of 

what the segregated awards should be and therefore require a remand). Because 

the disputes in the initial trial included both whether the property was unequally 

appraised and, if so, its equal and uniform value, a new trial on both issues is 

necessary. See Tex. R. App. P. 44.1(b); Garza, 431 S.W.3d at 108.

26
III. The award of attorneys’ fees to Valero must also be reversed and 

remanded for a new trial.

In its third issue, GCAD challenges the trial court’s award of attorneys’ fees 

to Valero. Valero sought, and the trial court awarded, attorneys’ fees pursuant to 

section 42.29 of the Texas Tax Code. This section provides that a property owner 

who prevails in a tax appeal on unequal appraisal grounds may be awarded 

reasonable attorneys’ fees. See Tex. Tax Code Ann. § 42.29 (West 2008). 

Because we have reversed the unequal appraisal judgment in favor of Valero, 

Valero is no longer a prevailing party at this stage of the proceedings. We 

therefore sustain GCAD’s third issue, reverse the judgment’s award of attorneys’ 

fees, and remand that matter to the trial court as well. See Bluelinx Corp. v. Texas 

Const. Sys., Inc., 363 S.W.3d 623, 630 (Tex. App.—Houston [14th Dist.] 2011, no 

pet.).

CONCLUSION

Having sustained GCAD’s second and third issues on appeal, we reverse the 

judgment of the trial court and remand this case to the trial court for a new trial.

/s/ J. Brett Busby

Justice

Panel consists of Justices Boyce, Busby, and Wise.

27