Texas Tax Code
Sec. § 11.11
Public Property


(a)

Except as provided by Subsections (b) and (c) of this section, property owned by this state or a political subdivision of this state is exempt from taxation if the property is used for public purposes.

(b)

Land owned by the Permanent University Fund is taxable for county purposes. Any notice required by Section 25.19 (Notice of Appraised Value) of this code shall be sent to the comptroller, and the comptroller shall appear in behalf of the state in any protest or appeal relating to taxation of Permanent University Fund land.

(c)

Agricultural or grazing land owned by a county for the benefit of public schools under Article VII, Section 6, of the Texas Constitution is taxable for all purposes. The county shall pay the taxes on the land from the revenue derived from the land. If revenue from the land is insufficient to pay the taxes, the county shall pay the balance from the county general fund.

(d)

Property owned by the state that is not used for public purposes is taxable. Property owned by a state agency or institution is not used for public purposes if the property is rented or leased for compensation to a private business enterprise to be used by it for a purpose not related to the performance of the duties and functions of the state agency or institution or used to provide private residential housing for compensation to members of the public other than students and employees of the state agency or institution owning the property, unless the residential use is secondary to its use by an educational institution primarily for instructional purposes. Any notice required by Section 25.19 (Notice of Appraised Value) of this code shall be sent to the agency or institution that owns the property, and it shall appear in behalf of the state in any protest or appeal related to taxation of the property.

(e)

Property that is held or dedicated for the support, maintenance, or benefit of an institution of higher education as defined by Section 61.003 (Definitions), Education Code, but is not rented or leased for compensation to a private business enterprise to be used by it for a purpose not related to the performance of the duties and functions of the state or institution or is not rented or leased to provide private residential housing to members of the public other than students and employees of the state or institution is not taxable. If a portion of property of an institution of higher education is used for public purposes and a portion is not used for those purposes, the portion of the property used for public purposes is exempt under this subsection. All oil, gas, and other mineral interests owned by an institution of higher education are exempt from all ad valorem taxes. Property bequeathed to an institution is exempt from the assessment of ad valorem taxes from the date of the decedent’s death, unless:

(1)

the property is leased for compensation to a private business enterprise as provided in this subsection; or

(2)

the transfer of the property to an institution is contested in a probate court, in which case ad valorem taxes shall be assessed to the estate of the decedent until the final determination of the disposition of the property is made. The property is exempt from the assessment of ad valorem taxes upon vesting of the property in the institution.

(f)

Property of a higher education development foundation or an alumni association that is located on land owned by the state for the support, maintenance, or benefit of an institution of higher education as defined in Chapter 61 (Texas Higher Education Coordinating Board), Education Code, is exempt from taxation if:

(1)

the foundation or organization meets the requirements of Sections 11.18 (Charitable Organizations)(e) and (f) and is organized exclusively to operate programs or perform other activities for the benefit of institutions of higher education; and

(2)

the property is used exclusively in those programs or activities.

(g)

For purposes of this section, an improvement is owned by the state and is used for public purposes if it is:

(1)

located on land owned by the Texas Department of Criminal Justice;

(2)

leased and used by the department; and

(3)

subject to a lease-purchase agreement providing that legal title to the improvement passes to the department at the end of the lease period.

(h)

For purposes of this section, tangible personal property is owned by this state or a political subdivision of this state if it is subject to a lease-purchase agreement providing that the state or political subdivision, as applicable, is entitled to compel delivery of the legal title to the property to the state or political subdivision, as applicable, at the end of the lease term. The property ceases to be owned by the state or political subdivision, as applicable, if, not later than the 30th day after the date the lease terminates, the state or political subdivision, as applicable, does not exercise its right to acquire legal title to the property.

(i)

A corporation organized under the Texas Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon’s Texas Civil Statutes), or a successor statute, that engages primarily in providing chilled water and steam to an eligible institution, as defined by Section 301.031 (Definitions), Health and Safety Code, is entitled to an exemption from taxation of the property the corporation owns as though the property of the corporation were owned by this state and used for health or educational purposes.

(j)

For purposes of this section, any portion of a facility owned by the Texas Department of Transportation that is a rail facility or system or is a highway in the state highway system, and that is licensed or leased to a private entity by that department under Chapter 91 (Rail Facilities) or 223 (Bids and Contracts for Highway Projects), Transportation Code, is public property used for a public purpose if the rail facility or system, highway, or facility is operated by the private entity to provide transportation or utility services. Any part of a facility, rail facility or system, or state highway that is licensed or leased to a private entity for a commercial purpose is not exempt from taxation.
Acts 1979, 66th Leg., p. 2234, ch. 841, Sec. 1, eff. Jan. 1, 1980. Amended by Acts 1981, 67th Leg., 1st C.S., p. 127, ch. 13, Sec. 30, eff. Jan. 1, 1984; Acts 1983, 68th Leg., p. 4821, ch. 851, Sec. 5, eff. Aug. 29, 1983; Acts 1983, 68th Leg., p. 5419, ch. 1007, Sec. 1, eff. Jan. 1, 1984; Acts 1989, 71st Leg., ch. 796, Sec. 14, eff. Jan. 1, 1990; Acts 1989, 71st Leg., ch. 1021, Sec. 1, eff. Aug. 28, 1989; Acts 1990, 71st Leg., 6th C.S., ch. 12, Sec. 2(31), eff. Sept. 6, 1990; Acts 1991, 72nd Leg., 2nd C.S., ch. 6, Sec. 9, eff. Sept. 1, 1991; Acts 1997, 75th Leg., ch. 843, Sec. 1, eff. Jan. 1, 1998; Acts 2001, 77th Leg., ch. 362, Sec. 1, eff. May 26, 2001; Acts 2003, 78th Leg., ch. 1266, Sec. 1.01, eff. June 20, 2003.
Amended by:
Acts 2005, 79th Leg., Ch. 281 (H.B. 2702), Sec. 2.95, eff. June 14, 2005.
Acts 2007, 80th Leg., R.S., Ch. 204 (S.B. 812), Sec. 1, eff. January 1, 2008.
Acts 2009, 81st Leg., R.S., Ch. 87 (S.B. 1969), Sec. 25.152, eff. September 1, 2009.
Acts 2011, 82nd Leg., R.S., Ch. 259 (H.B. 1201), Sec. 1, eff. June 17, 2011.
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May. 14, 2021