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<br />151 <br /> <br />2006 <br />TML RESOLUTION COVER SHEET <br /> <br />Sponsoring Entity: The City of San Marcos <br /> <br />Brief Background: The Texas General Land Office (GLO) has embarked on a program of <br />purchasing prime real estate on behalf of the Permanent School Fund, and then leasing the <br />property to private, commercial enterprises for purposes of development. Under the State <br />Constitution and State Statutes, as interpreted by the Attorney General, the state's interest in land <br />is not taxable even when it is leased for private commercial development. The only interest in <br />such land that is taxable is the market value of the lease, and the market value of such leases is <br />usually only a small fraction of the market value of the land and improvements. This program <br />therefore substantially removes property from the tax roll, depriving cities, school districts and <br />counties of property tax revenues they would receive were the developments to be privately <br />owned. This places extraordinary burdens on local governments by requiring them to provide <br />numerous services such as law enforcement, fire protection, public education, and infrastructure <br />maintenance without needed property tax revenues, and thereby shifts the cost for providing <br />these services to existing taxpayers, including homeowners and businesses. <br /> <br />What the Resolution is Intended to Accomplish: State statutes should be amended to address <br />this issue as follows: <br />1. Require the GLO to notify and secure the consent of local taxing entities before the GLO <br />leases state-owned land for private commercial development; and <br />2. Require compliance with all applicable city regulations in the development of state-owned <br />land leased for private commercial development. <br /> <br />Statewide Importance: The GLO program is being carried out throughout the state, and the <br />state laws that allow the GLO to achieve an uneven playing field relative to property taxes and <br />development regulations apply throughout the state. <br /> <br />Submitted by: <br /> <br />Name: <br /> <br />Susan Narvaiz <br /> <br />Title: Mayor <br /> <br />City: San Marcos <br /> <br />Telephone: 512/393-8085 <br />