Ad Valorem / Property Tax Exemptions

 Pollution Control Ad Valorem Exemption

 A Texas constitutional amendment providing an exemption from property taxation for pollution control was approved in 1993. The intent was to ensure that compliance with environmental mandates, through capital investments, did not result in an increase in a facility’s property taxes.  A facility must first receive a determination from the Texas Commission on Environment Quality (TCEQ) that property is for pollution control purposes. That positive use determination is then provided to the local appraisal district, which must accept the TCEQ’s decision and grant the property an exemption from property taxes.

To be eligible for a positive use determination, the property must have been purchased, acquired, constructed, installed, replaced, or reconstructed after January 1, 1994 to meet or exceed federal, state, or local environmental laws, rules, or regulations.  

Application Form

Renewable Energy Device Exemption 

Texas property tax code permits a 100% exemption on the appraised value of solar, wind or biomass energy devices installed or constructed for the production and use of energy on-site.

Application Form

 Agricultural Ad Valorem Exemptions

Agricultural appraisal lowers the value of land based on the land’s capacity to produce crops, livestock, qualified wildlife, or timber, instead of its value on the real estate market. This lower value reduces property taxes on the land. Taxpayers may qualify for agricultural appraisal under two different laws. The newer law is called “open-space valuation” or “1-d-1 appraisal” (after Article 8, Section 1-d-1 of the Texas Constitution). Nearly all land that receives agricultural appraisal is under this law. Details on the older law — known as “1-d” or “agricultural use” — are available from your appraisal district.  For “1-d-1 appraisal,” the land must meet the following: The land must be devoted principally to agricultural use. Agricultural use includes production of crops, livestock, poultry, fish, or cover crops. It also can include leaving the land idle for a government program or for normal crop or livestock rotation. Land used for raising certain exotic animals (including exotic birds) to produce human food or other items of commercial value and cutting wood for use in fences or structures on adjacent agricultural land also qualifies. Wildlife management is also an agricultural use. Such land was previously qualified open-space land and is actively used for wildlife management. Wildlife management land must be used in at least three of seven specific ways to propagate a breeding population of wild animals for human use. Timberland must be used with the intent to produce income and be devoted principally to the production of timber.  Both agricultural land and timberland must be devoted to production at a level of intensity that is common in the local area. The land must have been devoted to agricultural and/or timber production for at least five of the past seven years. However, land within the city limits must have been devoted continuously for the preceding five years, unless the land did not receive substantially equal city services as other properties in the city.

Residential Homestead Exemptions   

The Property Tax Code authorizes the governing body of each political subdivision in the State of Texas to exempt up to twenty percent (20%) of the appraised value of residential homesteads from ad valorem taxation.  Where ad valorem taxes have previously been pledged for the payment of debt, the governing body of a political subdivision may continue to levy and collect taxes against the exempt value of the homesteads until the debt is discharged, if the cessation of the levy would impair the obligations of the contract by which the debt was created.  The adoption of a homestead exemption may be considered each year, but must be adopted by April 30.

Historic Structures Tax Exemption

The City of Houston may grant a tax exemption to qualified property owners who improve designated historic properties. A property owner who has been denied a Certificate of Appropriateness is not eligible for a tax exemption. The exemption applies for five (5) years when granted by the City. If combined with other tax entities, the exemption period may apply for up to ten (10) years.  Contact: Department of Planning & Development, Randy Pace 713.837.7796;