1. What Every Broker Should Know About
Open Space Valuations

2. Top Tips for Open Space Valuations
How to qualify for ag, wildlife, timber and Ecolab
No minimum size requirement
New owners must re-apply
Buyers need to know ag-history
Owners should protest market value
Developers should use phase in approach
Rollback taxes only apply if change in use

3. What is 1-d-1 Open- space Valuation?
Found in the Texas Constitution Article 8, Section 1-d-1
Four ways to qualify:
Agricultural use
Wildlife Management Use
Ecological Laboratory (Ecolab)
Timber Production
“Special Valuation” not an “Exemption”
Property appraised at its “Productive Value” rather than its “Market Value”

4. Agricultural Use Property Tax Code Sec 23.51
Land is “devoted principally” to agriculture
Agricultural use must be to the “degree of intensity generally accepted in the area”
Must be used for agriculture for 5 of 7 previous years
Application to Central Appraisal District before May 1.

5. Examples of Agricultural Use
Producing crops for human food, animal feed, including crop rotation
Planting seed for the production of fiber
Floriculture, viticulture, horticulture
Raising or keeping livestock
Raising or keeping exotic animals for food / fiber production
Timber production
Beekeeping

6. What does not qualify? Harvesting native plants
Harvesting native animals
Processing plants or animals
Exotic game hunting
Recreational fishing
Boarding / training horses
Land located within a city

7. Ag Categories Irrigated cropland Dry cropland Improved pasture
Native pasture
Orchard
Waste

8. The New Landowner’s Concerns
Today’s buyer of rural land is a new kind of buyer.
They want recreational land, not Ag land.
They have no experience with Ag operations.
They’d rather not share their land– i.e. they don’t want to deal with lessees.
They are worried about affording large parcels of land without an “Ag exemption.

9. Wildlife Management Value as a Solution
Wildlife Management Valuation meets these concerns:
Most urbanites would rather own a “wildlife preserve” than a farm or ranch.
Wildlife Management requirements often fit within the goals of the recreational landowner and conservation organizations.
Many of the recommended practices can be done by the landowner, without special equipment or much training and/or with the assistance of a Land Trust.
Landowners can afford larger tracks of land if the tax exposure is maintained at an affordable level.

10. Section 23.51(7)(A), Tax Code
Wildlife management (WM) is an alternative to a traditional “agriculture” appraisal.
Land must be used to propagate a breeding, migrating, wintering population of indigenous wild animals for human use.
At least 3 eligible management practices performed to required level of intensity.

11. THE BIG SEVEN Habitat control Erosion control Predator control
Providing supplemental supplies of water
Providing supplemental supplies of food
Providing shelters
Making census counts to determine population

12. Wildlife Management Requirements
Existing 1-d-1 open space appraisal
Primary use is wildlife management
WM plan being followed
WM takes priority over other uses
Secondary uses do not interfere
Degree of intensity
Minimum acreage

13. Texas Property Tax Code Amendments§23.51(7)(B),(C) and (8)
(7)(B) land used to protect endangered species under a federal permit if :
(i) in a habitat preserve and subject to a conservation easement; or
(ii) part of a conservation development under an HCP; or
(C) land used for a conservation or restoration project to compensate for natural resource damages.
(8) “Endangered species,” “federal permit,” and “habitat preserve” have the meanings assigned by Section , Parks and Wildlife Code

14. What exactly is an EcoLab?
The Texas Tax Code Section 23.51
Similar to an agricultural or wildlife management valuation
Landowners partner with universities to host confidential research
Alternative for landowners interested in wildlife management
Research must be in furtherance of farming, ranching or wildlife management. .

15. Saving Money While Supporting Research
Perfect for properties that are paying market value taxes
Usually takes 6 years of grazing or farming to reduce taxes
Reduce property taxes within one year to $2.00/acre
Landowner provides grant money to fund research
Grants are tax deductible

16. Advantages No requirement to do five years of grazing or farming
Move into wildlife management after two years
Advances important scientific research
Enhances relationships with universities and professors

17. Qualifications Properties larger than 50 acres work best
Land must be contiguous if more than one owner
Property must be principally used for research by a college and/or university
Landowner commits to funding and accommodating research projects for 2 year period
Property needs at least three researchers

18. How is the Land Used?
Landowners choose which research to host and fund
Researchers will conduct research on property
Study of grasses, insects, birds, soil sampling, small mammals, fish
Landowners can use property recreationally

19. No Size Limit for 1-d-1 Valuations
BUT… still have to meet legal tests of principal use and intensity.
No minimum size requirement for wildlife UNLESS…. property has been subdivided in previous year, then appraisal district’s minimum acreage applies.
Form Wildlife Management Property Association
Beekeeping is limited to 5-20 acres

20. Tips for Buyers New owners must re-apply by May 1st.
Buyers need to know ag-history of property
Owners should protest market value every year
Review Notice of Appraised Value

21. Tips for Developers Know the minimum acreage requirements
Developer should use phase in approach
Rollback taxes only apply if change in use
The difference between “Market Value” taxes and “productive Value” taxes for the previous 5 years, plus 7% interest accrued.

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