TAX - TEXAS

Harward v. City of Austin

United States Court of Appeals, Fifth Circuit - October 11, 2023 - F.4th - 2023 WL 6617932

Shoreline property owners brought action against city, seeking various declarations, injunctions, and writs of mandamus regarding claim that city’s ordinance declaring that their properties were within city’s full-purpose jurisdiction and subject to taxation constituted an illegal annexation attempt under federal and Texas law.

The United States District Court adopted the report and recommendation of United States Magistrate Judge and dismissed all claims. Property owners appealed.

The Court of Appeals held that:

Tax Injunction Act (TIA) did not preclude shoreline property owners’ claims for a declaration that their properties were within Texas city’s extraterritorial or limited-purpose jurisdiction and for invalidation of city ordinance declaring that their properties were within city’s full-purpose jurisdiction and subject to taxation; property owners were challenging a separate legal mandate as opposed to a tax, and the challenged ordinance imposed costs separate and apart from the property taxes in that it subjected the properties to the city’s broad home-rule authority.

Tax Injunction Act (TIA) did not bar shoreline property owners’ alternative claims for equal municipal services from Texas city or just compensation for the taking of their properties’ jurisdictional status, which claims stemmed from challenge to city’s ordinance declaring that the properties were within city’s full-purpose jurisdiction and subject to taxation; the requests would not stop the assessment, levy, or collection of city taxes.

Tax Injunction Act (TIA) barred shoreline property owners’ request for a declaration that Texas city’s notices to appraisal district that the properties were within taxing-unit boundaries were invalid, which was a request made in action challenging city’s ordinance declaring that their properties were within city’s full-purpose jurisdiction and subject to taxation; the request went beyond the ordinance and directly challenged the state’s taxing power by affirmatively precluding the appraisal district from assessment, levy, and collection of future taxes on the properties.

Tax Injunction Act (TIA) barred shoreline property owners’ request for a writ of mandamus directing Texas city to instruct appraisal district and county assessor-collector that the properties were in city’s extraterritorial or limited-purpose jurisdiction, which was a request made in action challenging city’s ordinance declaring that their properties were within city’s full-purpose jurisdiction and subject to taxation; the request went beyond the ordinance and directly challenged the state’s taxing power by affirmatively precluding the appraisal district from assessment, levy, and collection of future taxes on the properties.



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