Untitled Texas Attorney General Opinion

R-823 ,.

THE ATTORNEY GENERAL, ‘.. )i OF TEXAS AUWI-XN 11. - PRICE DANIEL ATTORNEYGENERAL

October 1, 1947

Honorable Sidney 3. Brown Opinion No. V-395 County Attorney Fort Bend County Re: The taxability of ' Richmond, Texas certain real property ., on which Sugarland In- dustries granted cer- tain easement rights to Fort Bend County Water Control and Im- provement District. Dqor Mr. Drown: Your requeet for an official opinion bearing date of September 18, 1947, Is as follows: "A question has arisen as to whether ap- proximately900 acres of land owned by the : Sugarlbnd Induntrles should be subject to State and County taxes. This land is located in the FortBend County Water,Controland Im- provement District number One which was cre- ated about 1929 and the Sugarland Industries and some of its subsidiariesconveyed certain easement rights to the Ford Bend County Water Control and ImprovementDistrict number One in 1936 and these easements conveyed approxi- mately 900 acres. Since 1937 the officials of the Sugarland Industrieshave signed the assessmentrolls on the property and marked the asBes&aent as being exempt from taxation becauusethe property WOE owned by the Fort Bend County Water Control and Improvement District, a political subdivisionof the State. "About ninety per cent of the area oom- prising the Fort Bend County Water Control and ImprovementDistrict number One is Owned by the Sugarland Industries and a survey waB made by them of all the small lakee, sloughs, creeks, and bayous on their land and then the easement was conveyed to the District. The

Honorable Sidney J. Brown, Page 2 (V-395)

easement contained the following provisions with reference to the purpose of the grant, to-wit: "'A prior and superior right to take, we, enjoy, and dispose of for use by others, any and all water constitutingthe natural flow, flood or impoundedwaters of Oyster Creek, subject only to such prierities, other than those which would otherwise arise by virtue of riparian rights, as may be pro- vided by law with respect thereto.' "i * *

"The Assessor and Collector of Fort Bend County certainly does not intend to tax the Water Control and ImprovementDlatrict but he is contendingthat Sugarland Indus- tries should pay taxes for the past ten years on the value of their remaXning in- terast in the property. The lahd is now being sold for home sites along the lake fronts and the Assessor and Collector has refused to issue tax certificotasuntil taxes arc paid upon the land for the part ten years. Concretelyyour question is: "Dow the grant- ing by Sugarland Industries to the Fort Bend County Water Mntrol and ImprovementDistrict of an easement in cer- pn real property owned by it operate to exempt the #*perty in question from ad valorem taxation?' We do not think this question requires eXten@- rd dlscursion. It is no longer a debatable question in fhia State, It, indeed, it ever was. A mere easement granted to the Fort Bend County Water Control and Im- provement District by the Sugarland Industrieswill not support an exemption since the grantors remain in fact the owners of the property. In the case of City of Corpus Christi v. State, 155 S. W. (2d) 824 (is&i, error refused), the landowners#ranted t$ the city of Corpus Christi a forty-year easement for the constructionand use of a water reservoir, the owners retaining title, the mineral rights and agriculturalrights with respect to a certain portion of the tract, which however the

Honorable Sidney J. Brown, Page 3 (V-395)

city could use as a rtservelr in c8s* of 8n ntmtrgtncy.n In prosing upon the question, the Court stated: "We are of the opinion that the written Instrument involved f8 an easement deed. It Is so described in the conveyance itself. Its effect was to burden the lands described therein with an eaaement which undoubtedly oper8ted to decrease substantiallythe value of the property for farming or grazing pur- poses. It did not, however, diminish or de- stroy the title or estate of said gr8ntors to the extent that such Interest can no long- er be clasaificd 8s real property and taxed as such. Article 7146, Vernon’s Ann. Civ'. * Victor v. Hinson, 12 Tex. 30, 102 i%?;d 194; 40 Tex’. Jur., 9: , B 63.I’ We peTccivt no distinction in your c8sc and-the city of Corpus Christi case. Indeed, the facts seem almost par- rllel. Articles 7146 and 7319, V. C.,9. provide respectively: “Real property for the purpose of taxa- tion, shall be construed to include the land Itself, whether laid out In town lots or otherwise,and all buildingsj structuresand improvements,or other fixtures of whatsoever kind thereon, and 811 rights and privileges belong&n& or in 4ny wise appertaining there- to, and all mlnea, minerals, quarries and fo8slls in and under the same.” “For the purpose of taxation, real prop- erty shall include all lands within this Stat@, and all build$ngs gnd fixtures thereon and ap- pertaining th8r*ta,Waxceptsuch 8s are txprtsa- ly exempt48 by law. It is quite apparent that this property of the Su rrl.and Industriesis real estate subject to taxation un iE4r the foregoing statutory provisions and the Corpus ChrZsti case, supra, notwithstandingthe easement un- doubtedly operates to decreaee the value of the property for other purposes. However, it did not, a8 expressed In the 18nguage of the Corpus Chrlsl$ case, “diminish or destroy the title or estate ol said grlntors to the

Honorable Sidney J. Brown, Page 4 (V-395)

extent that such Interest can no loper be classified as real property and taxed 8s such. You'are, therefore,advised that the prop- erty of the Sugarland Industriesinvolved in your opinion request is subject to taxation. SUMMARY An easement granted by the owner of real property to 8 tax exempt political subdivlsiofiof the State,will not exempt the entire property from taxation since the grantors remain the owners 'ofa aub- St8nti81 interest in the property. Arts. 7146 and 7319, V. C. S.; City of Corpus .Christlv. State, 155 S. W. (2d) 82%. Very truly yours ATTORNEY GENERAL OF TEXAS

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