SB1579

Which land can enter the process? A qualifying city may establish the process only for an undeveloped parcel satisfying all applicable statutory conditions: it was never platted or surveyed, or remained undeveloped and unoccupied for at least 25 years after platting or survey; its assessed value on the latest appraisal roll is below $1,000; and it is not valued for agricultural use under Tax Code Chapter 23, Subchapter C. If it is in a subdivision, at least half that subdivision’s parcels must both be undeveloped, abandoned or unoccupied and be no larger than 10 acres. The law also expressly requires delinquent property taxes for the current tax year and for at least five of the preceding ten tax years. The 10-acre condition is part of the subdivision test, not a separately stated maximum size for every target parcel. Final law; Subchapter C agricultural appraisal.

The tax wording matters: Tax Code 1.04 defines a tax year as the calendar year, while the general rule in 31.02 makes ordinary taxes delinquent if unpaid before February 1 of the following year, subject to exceptions. This briefing reports SB1579’s express “current tax year” requirement; it does not assume an unpaid current bill is already delinquent or resolve how that condition will be applied in a particular proceeding. The agricultural exclusion specifically names Subchapter C, not every form of agricultural or open-space valuation. Final law; Tax definitions; General delinquency rule; Separate open-space definitions.

Notice and hearing come first. The city must hold a public hearing and make reasonable notification efforts. Notice goes to record owners, recorded lienholders and people who paid the property taxes during the latest 15 tax years, using personal delivery, certified return-receipt mail or USPS signature confirmation when addresses can reasonably be found in the specified county-clerk, tax-office or appraisal records. Newspaper and city-website notice is due at least ten days before the hearing; county property records must also carry notice warning that rights may be extinguished. The filed notice binds later transferees. Compliance creates a presumption of actual and constructive notice to owners and lienholders even without a response. Final law.

Owners and lienholders may contest the qualifying factors at the hearing; the Texas Rules of Evidence do not apply there. Full payment of taxes with no delinquent taxes or penalties owing at the hearing is an affirmative defense even if payment came after notice. The city may hear multiple parcels together. A qualifying determination requires a resolution within 14 days after the hearing and publication/posting within 14 days after the resolution, with a website-plus-newspaper alternative specified in the act. An owner, owner’s agent or lienholder has 60 calendar days from the resolution to file a verified challenge in a district court in the county where the land lies, specifying why the resolution is illegal. Without a timely petition the resolution becomes final; judicial review uses the substantial-evidence rule, not an unrestricted new determination. Final law.

A court-appointed receiver controls the land. After a final determination, the city must seek receivership in a civil action; the act provides for extinguishing and transferring the affected property rights to the receiver, subject to net-proceeds protections. Record owners and lienholders must receive personal notice under the civil-procedure rules; that service also constitutes notice to unrecorded interest holders. The court cannot appoint the city, its officials or employees, their relatives within the stated third degree, or someone who may directly benefit from an administrative action taken as receiver. The receiver must have demonstrated knowledge of the problems created by these parcels and is a sworn court officer and may improve, combine, plat or replat, accept donated parcels and sell land. A donation becomes irrevocable if not challenged within its first year. Final law.

The record owner or agent may redeem land still under the receiver’s control during the 12 months after the receiver’s appointment by paying current and delinquent taxes plus applicable proportional notice and administrative costs. The act does not say that every parcel must be held unsold for twelve months. Court approval is required for use of receivership funds and for any sale. The receiver must account for costs, revenues, parcel dispositions and, as the court requires, interests in net proceeds. A fee may be included up to 15 percent of costs and expenses—not 15 percent of the sale price—unless the court allows a different limit for good cause. Unreimbursed costs, expenses and fees are secured by a lien. Final law.

Sale and remaining proceeds. Sales must use public auction, sealed bid or sealed proposal. English- and Spanish-language newspaper notices must appear before the 60th day and again before the 30th day preceding sale; the receiver must also make best efforts to attract qualified potential developers and bidders. Required notice describes the property, method/date, any minimum bid, financial terms and additional use conditions. Offers may all be rejected and land reorganized or combined for a later offering. Closing gives the buyer full ownership (fee-simple title); a sale following the prescribed process makes its price conclusive evidence of market value at that time. Net proceeds must be held in trust for at least three years unless claimed earlier, with practicable further notices ordered by the court. Remaining funds then pass to the state, subject to the cited Property Code disposition and recovery provisions—not automatically to the city or receiver. Final law; State accounting; Personal-property recovery provision; Recovery order provision.

What changed during passage? The Senate substitute added the express city-boundary limitation; the Senate-passed and House committee texts retained it. Mary González’s sole indexed House amendment was adopted May 27 and survives in the final law: it added current-year and five-of-ten-year tax delinquency, clarified nonoccupancy and the subdivision test, strengthened the paid-up-tax defense, added notice to the last 15 years’ taxpayers and searches of county tax records, allowed an owner’s agent in the challenge language, excluded directly benefiting receivers, and added the twelve-month redemption provision, with conforming wording and renumbering. Introduced; Senate substitute; Senate-passed; House committee; Full González amendment; Amendment disposition; Version index; Final law.

Compare the published text versions in the official text index. A change is not attributed to a specific amendment here without a verified record.

Qualifying municipalities and potential developers gain a way to assemble and improve long-unused parcels; neighbors could benefit from development if it occurs. Owners and lienholders face a serious risk of losing their land interests and must use the available defenses, challenge and redemption procedures if applicable. Receivership costs and fees can reduce net proceeds. None of this guarantees development, a particular sale price or money remaining for an owner. Final law.

The March 30 introduced, April 1 substitute and May 29 passed-second-house fiscal notes anticipate no significant state or local-government fiscal impact and assume state costs can be absorbed with existing resources. They give no dollar estimate or multiyear table and do not measure an individual owner’s potential loss or a city’s actual hearing and litigation workload. The act makes no appropriation. Original fiscal note; Substitute fiscal note; Passed-second-house note; Final-index note; Final law.