Can a Texas appraisal district keep a 'one entity, one vote' method for choosing its board after House Bill 1010?

Plain-English summary

In Texas, property is appraised for tax purposes by a county appraisal district, which is governed by a five-member board of directors. The board is appointed by the various taxing units, the county, cities, school districts, and special districts, that participate in the district. How much say each taxing unit gets is its "voting entitlement." The default rule, Tax Code section 6.03(d), ties that to money: a taxing unit's votes are proportional to its share of the total taxes levied by everyone in the district, so a large school district outvotes a small city. A separate provision, section 6.031, lets the district adopt a different method by a three-fourths vote of the taxing units.

In 1988 the Hood County Appraisal District used section 6.031 to switch from the money-weighted default to a flat "one entity, one vote" system, where every participating taxing unit had equal power regardless of how much it levied. It kept using that system as the number of participating units grew from five to eleven. The Hood County Attorney asked the AG four questions, the central one being whether House Bill 1010, a 2007 law that required appraisal districts to line up with county boundaries, wiped out the 1988 alternative method.

The AG concluded a court would likely answer yes, the alternative method was invalidated. The opinion worked through HB 1010's transition provisions. Section 6(b) did not merely declare board seats vacant; it "expired" the existing staggered terms as of January 1, 2008, effectively ending any staggered-term structure a district had built under section 6.031. Section 6(c) then set how voting entitlement would be calculated for the 2007 election into the new districts, and it did so with a formula identical to the section 6.03 default (just using county boundaries), introduced by the words "notwithstanding section 6.03." The AG read "notwithstanding" to mean "despite," so the transition formula governed in spite of anything in section 6.03, and it did not preserve or grandfather any alternative entitlement method. Taken together, the transition sections reset every participating unit to a proportionate, default-style entitlement.

Because the first question resolved the matter, the AG said it did not need to reach the second and third questions. On the fourth, it concluded that voting entitlement should now be determined by the section 6.03(d) default formula, unless the district took fresh action under section 6.031 after HB 1010 to change the method again.

Currency note

This opinion was issued in 2020. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

What the opinion meant for those who asked

For the Hood County Appraisal District and its participating taxing units, the opinion's reading was that the 1988 "one entity, one vote" arrangement most likely did not survive House Bill 1010. The AG's analysis pointed the district back to the section 6.03(d) default, where voting power tracks each unit's share of the tax levy, unless the district had since re-adopted an alternative method under section 6.031 after 2007. The opinion framed this as what a court would likely conclude, not a binding ruling, which matters because AG opinions are persuasive rather than controlling. For smaller taxing units that had benefited from equal voting, the practical significance the opinion described was a probable shift back toward levy-weighted voting; for the larger units, the reverse. The AG also noted, in a footnote, that directors who had been seated under the post-2007 alternative method were likely de facto officers, meaning their official acts would still be treated as valid as to the public and third parties even if the appointment method was later found improper.

Common questions

Q: How is appraisal district board voting power normally decided in Texas?
A: By Tax Code section 6.03(d), which gives each taxing unit votes in proportion to its share of the total taxes levied by all units in the district.

Q: Can a district use a flat 'one entity, one vote' method instead?
A: Section 6.031 allows a district to adopt an alternative method by a three-fourths vote, but this opinion concluded that House Bill 1010 likely invalidated alternative methods adopted before 2007.

Q: What did House Bill 1010 change?
A: It required appraisal districts to align with county boundaries and, through its transition provisions, expired existing staggered board terms and reset voting entitlement to a formula matching the section 6.03 default.

Q: So which method governs now?
A: The AG concluded the section 6.03(d) default formula governs, unless the district adopted a new section 6.031 change after House Bill 1010.

Q: Were past board actions under the old method valid?
A: The AG noted those directors were likely de facto officers, so their official acts would be treated as valid as to the public and third parties.

Background and statutory framework

Tax Code section 6.03 establishes the five-member appraisal district board and the appointment process by participating taxing units (subsections (a), (b), (c)-(k)), with terms beginning January 1 of even-numbered years and an election process running October through December of odd-numbered years. Section 6.03(d) sets the default voting-entitlement formula tied to each unit's relative share of the total tax levy. Section 6.031 authorizes the board or taxing units to change the method or procedure of appointment, requiring adoption by at least three-fourths of the units and invalidating a change that reduces the entitlement of a non-adopting unit (subsection (b)). Section 6.034 authorizes staggered director terms. House Bill 1010, enacted as the Act of May 17, 2007, 80th Leg., R.S., ch. 648, 2007 Tex. Gen. Laws 1223, required appraisal districts to align with county boundaries (section 1, codified at Tax Code section 6.02(a)) and repealed the overlapping-district provision former section 6.025 (section 5(3)). Its transition provisions, sections 6(b) and 6(c), expired pre-2008 staggered terms and prescribed how 2007 voting entitlement was calculated for the realigned districts. The AG read "notwithstanding" to mean "despite," citing State v. Pub. Util. Comm'n, 110 S.W.3d 580 (Tex. App.-Austin 2003, no pet.). On the validity of acts by directors seated under the superseded method, it cited the de facto officer doctrine from Williams v. State, 588 S.W.2d 593 (Tex. Crim. App. 1979), and Plains Common Consol. Sch. Dist. No. 1 v. Hayhurst, 122 S.W.2d 322 (Tex. App.-Amarillo 1938, no writ). The pre-2007 overlapping-district scheme traced to the Act of Apr. 22, 1997, 75th Leg., R.S., ch. 165, and the Act of May 12, 1995, 74th Leg., R.S., ch. 186.

Citations and references

Statutory provisions:

• Tex. Tax Code § 6.03; § 6.031; § 6.034; § 6.02
• Act of May 17, 2007, 80th Leg., R.S., ch. 648, §§ 1, 5(3), 6, 6(b), 6(c), 6(f), 2007 Tex. Gen. Laws 1223 (H.B. 1010)
• Act of Apr. 22, 1997, 75th Leg., R.S., ch. 165, § 6.72, sec. 6.02(6), 1997 Tex. Gen. Laws 327, 372
• Act of May 12, 1995, 74th Leg., R.S., ch. 186, § 1, 1995 Tex. Gen. Laws 1914, 1914-15

Cases:

• Williams v. State, 588 S.W.2d 593, 595 (Tex. Crim. App. 1979)
• Plains Common Consol. Sch. Dist. No. 1 v. Hayhurst, 122 S.W.2d 322, 327 (Tex. App.-Amarillo 1938, no writ)
• State v. Pub. Util. Comm'n, 110 S.W.3d 580, 586 (Tex. App.-Austin 2003, no pet.)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/ken-paxton/kp-0287
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/2020/kp-0287.pdf

Original opinion text

Best-effort transcription from the official PDF. The pdftotext extraction of this 2020 opinion contained character-level glitches; obvious artifacts have been corrected. The linked PDF is authoritative.

KEN PAXTON
ATTORNEY GENERAL OF TEXAS

January 21, 2020

The Honorable Matthew A. Mills
Hood County Attorney
1200 West Pearl Street
Granbury, Texas 76048

Opinion No. KP-0287

Re: Voting entitlement of a taxing unit in the election of an appraisal district's board of directors under Tax Code section 6.03(d) (RQ-0299-KP)

Dear Mr. Mills:

You ask four questions about the voting entitlement of a taxing unit in an appraisal district's election for its board of directors under Tax Code section 6.03(d).[1]

Tax Code section 6.03 provides that an appraisal district is governed by a board of five directors appointed by the taxing units that participate in the district. TEX. TAX CODE § 6.03(a); see also id. § 6.03(c)-(k) (providing the process for the appointment of directors by the participating taxing units). The number of votes each taxing unit has, or its voting entitlement, is determined by a mathematical equation utilizing the taxing unit's relative percentage of the overall tax levy by all taxing units in the appraisal district and the number of director positions to yield a total number of votes for each taxing entity. Id. § 6.03(d); see Request Letter at 2 (describing the section 6.03 voting entitlement as the statutory default method). The election process occurs from October through December of each odd-numbered year to determine which board candidates will be appointed to terms commencing on January 1. TEX. TAX CODE § 6.03(g)-(k). The appointed directors "serve two-year terms beginning on January 1 of even-numbered years." Id. § 6.03(b). The other Tax Code section relevant to your question, section 6.031, authorizes the appraisal district board or the participating taxing units to change the method or procedure of board member appointment. Id. § 6.031(a)-(g); see id. § 6.031(b) (requiring adoption by at least three-fourths of the taxing units and invalidating a change "if it reduces the voting entitlement of one or more taxing units that do not adopt the resolution" as specified). And yet another Tax Code provision, section 6.034, authorizes the participating taxing units to create staggered terms for the directors. Id. § 6.034(a)-(i); see id. § 6.034(e) (providing for annual elections after implementation of staggered terms).

You tell us the Hood County Appraisal District's ("District" or "CAD") board resolved in 1988 to change the method of appointing its members, as allowed by section 6.031, from the section 6.03 statutory default method to a "one entity/one vote" method and has continued to use that method since 1988. Request Letter at 4 (clarifying that "each taxing entity entitled to vote has had equal power in determining the CAD Board despite significant differences in the relative amount of taxes levied by each entity"). In 1988, the District had five taxing unit members, but now it has eleven taxing units. Id. You tell us about the enactment of House Bill 1010 in 2007 and describe it as appearing to allow only the section 6.03 statutory default method to determine the voting entitlement as of September 1, 2007. Id. at 6. You also explain that notwithstanding House Bill 1010, one of the original five taxing units rescinded approval of its 1988 resolution providing for the one entity/one vote method to determine voting entitlement. Id. at 7. You explain further that, if effective, the rescission reduces that taxing unit's voting entitlement below the required threshold. Id. at 8. In this context, you ask four questions relating to the voting entitlement required after House Bill 1010. See id. at 8-9.

Your first question asks whether House Bill 1010 invalidated the 1988 resolution. Id. at 8. House Bill 1010 changed the operation of appraisal districts in Texas by requiring all appraisal districts to align with county boundaries. See Act of May 17, 2007, 80th Leg., R.S., ch. 648, § 1, 2007 Tex. Gen. Laws 1223, 1223-24 ("H.B. 1010") (codified as TEX. TAX CODE § 6.02(a)). Prior to its enactment, a taxing unit extending into two or more counties could choose to participate in only one appraisal district. See Act of Apr. 22, 1997, 75th Leg., R.S., ch. 165, § 6.72, sec. 6.02(6), 1997 Tex. Gen. Laws 327, 372 (amended by H.B. 1010, § 1); see also ENROLLED BILL SUMMARY, Tex. H.B. 1010, 80th Leg., R.S. (2007) at 1. As a result, the appraisal district would extend its boundaries beyond its own county to the extent of the taxing unit's boundaries in the other county. ENROLLED BILL SUMMARY, Tex. H.B. 1010, 80th Leg., R.S. (2007) at 1. This caused confusion and challenges for appraisal districts and taxpayers alike, and the Legislature sought to rectify the problem with House Bill 1010. HOUSE RESEARCH ORG., BILL ANALYSIS, Tex. H.B. 1010, 80th Leg., R.S. (2007) at 3.

In changing the landscape of appraisal district operations, House Bill 1010 provided several provisions to transition to the new approach. See H.B. 1010, § 6. We look to the transition provisions in sections 6(b) and 6(c) to address your first question. Transition section 6(b) of House Bill 1010 provides that

[t]he term of each appraisal district director in an appraisal district described by Section 6.025,[2] Tax Code, as that law existed immediately before September 1, 2007, serving a staggered term that but for this subsection would expire after January 1, 2008, expires on January 1, 2008. The appraisal district board of directors shall fill the vacant directorships as soon as practicable after January 1, 2008, as provided by Section 6.03(f), Tax Code.

H.B. 1010, § 6(b) (emphasis and footnote added). Briefing submitted by the District in connection with your request posits that transition section 6(b) preserves the staggering of board of director terms that may have been implemented by an appraisal district under Tax Code section 6.031 and shows that the "Legislature intended to keep the existing staggered-term elections and the method of appointing directors under . . . section 6.031."[3] The District avers that transition section 6(b) makes certain positions vacant and provides instructions about how to fill the vacant positions. District Brief at 3. The District also argues that if the Legislature intended to invalidate all existing staggered-term appointments, there would have been no need for transition section 6(b). Id. This argument is unavailing.

Transition section 6(b) does not merely make certain board positions vacant. To the contrary, it expires those terms. The language of transition section 6(b) provides that a term which, but for it, "would expire after January 1, 2008, expires on January 1, 2008." H.B. 1010, § 6(b) (emphasis added). To illustrate, consider a hypothetical five-member board with staggered terms. For the years relevant to House Bill 1010, the board comprises two director positions with terms running from January 1, 2007, to January 1, 2009, and three director positions with terms running from January 1, 2008, to January 1, 2010. See TEX. TAX CODE §§ 6.03(b) (providing for two-year terms), 6.034(d) (providing for the initial implementation of a staggered board), 6.034(e) (providing for terms to begin January 1). Absent transition section 6(b), the two terms running from January 1, 2007, to January 1, 2009, would expire after January 1, 2008. Under the plain language of transition section 6(b), those positions are not vacant, thereby requiring only the appointment of directors to serve out the existing terms until January 1, 2009. Instead, they are expired terms with subsequent terms running from January 1, 2008, to January 1, 2010. See id. § 6.03(b) (providing that appraisal directors serve two-year terms). It is the new terms, ending January 1, 2010, which are vacant requiring the appointment of new directors. See H.B. 1010, § 6(b) (requiring the appointment of directors as soon as practicable after January 1, 2008). At the conclusion of the transition, all five positions of this illustrative board now have terms that expire on January 1, 2010. Transition section 6(b) effectively terminates a board's staggered terms implemented prior to House Bill 1010.[4]

In like fashion, transition section 6(c) of House Bill 1010 provides that

[n]otwithstanding section 6.03, Tax Code, a taxing unit is entitled to vote in 2007 for appraisal district directors for terms beginning on January 1, 2008, in each appraisal district in which the taxing unit will participate in 2008 under the law as amended by this Act. The voting entitlement of each taxing unit entitled to vote for directors in 2007 is determined for each appraisal district by [a specified mathematical formula].

H.B. 1010, § 6(c). Transition section 6(c) provides the method to determine the voting entitlement of the taxing entities during the transition. Though House Bill 1010's changes relating to the "appraisal of property" apply to the 2008 tax year, transition section 6(c) expressly allows those taxing units that will participate in a new appraisal district as of 2008 to vote in 2007 on the directors for that new appraisal district. Id. In our illustrative example, the incoming taxing units could vote for the three director positions with terms running from January 1, 2008, to January 1, 2010. See TEX. TAX CODE § 6.03(g), (j), (k) (providing taxing unit voting procedures that run from October through December of the year prior to start of director term). Transition section 6(c) does not preserve or grandfather any alternative voting entitlement method; instead, it expressly provides that for each taxing unit entitled to vote in 2007 the voting entitlement is determined by a calculation method that is identical to the statutory default method in Tax Code section 6.03 but that incorporates a figure reflecting the county boundaries instead of the appraisal district boundaries. See H.B. 1010, § 6(c). The language "notwithstanding section 6.03" provides that this calculation method governs despite any contrary aspect of Tax Code section 6.03. See State v. Pub. Util. Comm'n, 110 S.W.3d 580, 586 (Tex. App.-Austin 2003, no pet.) (stating that "the word 'notwithstanding' means 'despite' or 'in spite of'"). Accordingly, transition section 6(c) effectively resets the voting entitlement back to a proportionate figure among the old and new participating taxing entities similar to that of the section 6.03 statutory default method. These transition sections suggest the Legislature intended to shift the taxing units into their new appraisal districts with a degree of operational parity. See also H.B. 1010, § 6(f) (providing for the 2008 appraisal district budget to be allocated proportionately to account for the new taxing units).

For these reasons, a court would likely conclude that House Bill 1010 invalidated any previously adopted alternative method for determining the voting entitlement of taxing units in an appraisal district's board election. This conclusion negates the need to address your second and third questions. See Request Letter at 8-9. Your fourth question asks whether the annual voting for the appointment of appraisal district directors should now be conducted via the statutory default method in Tax Code section 6.03(d). Id. at 9. Given our conclusion to your first question, Tax Code section 6.03(d) determines the voting entitlement for the appointment of appraisal district directors absent action taken under Tax Code section 6.031 subsequent to House Bill 1010 to change the voting method. See TEX. TAX CODE §§ 6.031 (authorizing change to voting entitlement), 6.034 (providing procedures to implement staggered terms for directors).

SUMMARY

Tax Code section 6.031 authorizes a change to the voting entitlement of taxing units in the appointment of an appraisal district's board of directors. Under the transition provisions of House Bill 1010 from 2007, a court would likely conclude that House Bill 1010 invalidated any previously adopted alternative method for determining that voting entitlement.

The voting entitlement for the appointment of appraisal district directors should be determined by Tax Code section 6.03(d), absent action taken under Tax Code section 6.031 to change that method subsequent to House Bill 1010.

Very truly yours,

KEN PAXTON
Attorney General of Texas

JEFFREY C. MATEER
First Assistant Attorney General

RYAN L. BANGERT
Deputy Attorney General for Legal Counsel

VIRGINIA K. HOELSCHER
Chair, Opinion Committee

CHARLOTTE M. HARPER
Assistant Attorney General, Opinion Committee

[1] Letter from Honorable Matthew A. Mills, Hood Cty. Att'y, to Honorable Ken Paxton, Tex. Att'y Gen. at 8-9 (Aug. 1, 2019), https://www2.texasattorneygeneral.gov/opinion/requests-for-opinion-rqs ("Request Letter").

[2] Section 6.025 provided the joint procedures for overlapping appraisal districts. See Act of May 12, 1995, 74th Leg., R.S., ch. 186, § 1, 1995 Tex. Gen. Laws 1914, 1914-15 (amended 1997, 1999, 2003), repealed by Act of May 17, 2007, 80th Leg., R.S., ch. 648, § 5(3), 2007 Tex. Gen. Laws 1223, 1224.

[3] Letter brief from James R. Evans, Jr., Low Swinney Evans & James, to Honorable Ken Paxton at 3 (Sept. 3, 2019) (hereinafter "District Brief") (on file with the Op. Comm.).

[4] Directors elected subsequently are likely de facto officers acting under the color of authority. See Williams v. State, 588 S.W.2d 593, 595 (Tex. Crim. App. 1979) (describing a de facto officer as "one who acts under color of a known and valid appointment, but has failed to conform to some precedent requirement, as to take the oath, give a bond, or the like" (quotation marks omitted)). As such, their actions are binding because the "law validates the acts of de facto officers as to the public and third persons on the ground that, though not officers de jure, they are in fact officers whose acts public policy requires should be considered valid." Plains Common Consol. Sch. Dist. No. 1 v. Hayhurst, 122 S.W.2d 322, 327 (Tex. App.-Amarillo 1938, no writ).