Fourth Court of Appeals
San Antonio, Texas
MEMORANDUM OPINION
No. 04-21-00564-CV
J-W POWER COMPANY,
Appellant
v.
FRIO COUNTY APPRAISAL DISTRICT, Appellee
From the 81st Judicial District Court, Frio County, Texas Trial Court No. 19-07-00221-CVF Honorable Russell Wilson, Judge Presiding
Opinion by: H. Todd McCray, Justice
Sitting: Lori I. Valenzuela, Justice Lori Massey Brissette, Justice H. Todd McCray, Justice
Delivered and Filed: August 26, 2026 AFFIRMED IN PART AND REVERSED AND RENDERED IN PART J-W Power Company (“J-W Power”) sued the Frio County Appraisal District (“FCAD”)
to remove its natural gas compressors from the county’s appraisal rolls for tax years 2013–2016 and to reimburse it for excess taxes paid, with interest and attorney’s fees. Both parties filed motions for summary judgment. In a final judgment, the trial court granted FCAD’s motion for summary judgment in part and J-W Power’s motion for summary judgment in part, ordering FCAD
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to remove specific compressors from the tax rolls for certain years. Both parties appealed from this judgment.
In a prior opinion in this appeal, we held that J-W Power’s motion to correct the rolls was barred by res judicata. See J-W Power Co. v. Frio Cnty. Appraisal Dist. (Frio Cnty. I), 692 S.W.3d 614 (Tex. App.—San Antonio 2023), rev’d, 691 S.W.3d 923 (Tex. 2024) (Frio Cnty. II). The Texas Supreme Court reversed our prior disposition and remanded the case for us to consider issues we did not previously reach. Having now considered all dispositive issues, we determine that FCAD was entitled to a take-nothing judgment on J-W’s Power’s claims as to all compressors for all tax years, save its claims to remove compressor numbers 3678 and 3681 from the FCAD appraisal rolls for tax year 2016. Only those specific compressors in that year were subject to multiple appraisals based on the summary judgment evidence. Therefore, we affirm the trial court’s judgment to the extent that it accords with our holding and reverse and render judgment to the limited extent the trial court’s judgment diverges from our holding.
BACKGROUND
A dealer’s heavy equipment inventory (“DHEI”) consists of the heavy equipment a dealer owns and may lease to its customers. See TEX. TAX CODE ANN. § 23.1241(a)(2). J-W Power sells and leases self-powered natural gas compressors which the parties agree qualifies as DHEI. It stores and maintains its compressors at storage yards located in several Texas counties, including Jim Wells County. From 2013–2016, some of its compressors stored at the Jim Wells County yard were leased for service in nearby counties, including Frio County.
In 2011 and earlier, counties assessed taxes on individual equipment that was physically located in their jurisdictions as business personal property. See TEX. TAX CODE ANN. § 22.01; EXLP Leasing, LLC v. Galveston Cent. Appraisal Dist., 554 S.W.3d 572, 574 (Tex. 2018).
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However, in 2011, the legislature amended the Texas Tax Code to provide that all equipment, including leased equipment, which met the definition of DHEI, should be appraised and taxed collectively as inventory. See Act of May 21, 2011, 82d Leg., R.S., ch. 322, §§ 1–3, 2011 Tex. Gen. Laws 938, 938–39 (codified at TEX. TAX CODE ANN. §§ 23.1241, .1242); J-W Power Co. v. Duval Cnty. Appraisal Dist., No. 04-21-00172-CV, 2022 WL 789345, at *1 (Tex. App.—San Antonio Mar. 16, 2022, no pet.) (mem. op.). Leased DHEI equipment was appraised and taxed by the county where it was originally stored and maintained as inventory (the “Inventory County”), rather than the county where it was physically located during the lease. See TEX. TAX CODE ANN. §§ 23.1241–42. Additionally, the market value of DHEI inventory would be determined by the previous calendar year’s annual lease income generated from the inventory, rather than from the value of individual compressors. TEX. TAX CODE ANN. § 23.1241(c); see EXLP Leasing, 554 S.W.3d at 583. Texas law requires that annual declarations showing the market value of the inventory be filed with the Inventory County. TEX. TAX CODE ANN. § 23.1241(f). Additionally, the owner of leased equipment is required to file monthly statements with the Inventory County and “deposit with the collector an amount equal to the total of unit property tax assigned to all items of heavy equipment sold, leased, or rented from the dealer’s heavy equipment inventor in the preceding month to which a unity property tax was assigned.” TEX. TAX CODE ANN. § 23.1242(b). 1
1 The version of section 23.1242 in effect during the relevant time period required monthly reporting to the relevant appraisal district. TEX. TAX CODE ANN. § 23.1242 (2025). However, in the 2025 legislative session, the law was updated to mandate quarterly reporting of leases and sales. Act of May 23, 2025, 89th Leg., R.S., ch. 439, § 1, Tex. Gen. Laws 6073 (current version at TEX. TAX CODE § 23.1242).
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Despite the changes to the Tax Code, for appraisals from tax years 2013–2016, 2 FCAD continued taxing J-W Power’s compressors leased to locations within Frio County, as business personal property under the default market-value rule, by looking at the value of each compressor. See TEX. TAX CODE ANN. § 22.01. While others litigated the constitutionality of the Tax Code changes, see, e.g., EXLP Leasing, 554 S.W.3d at 574, J-W Power paid the taxes FCAD assessed on its compressors. In addition to paying the property tax assessed by FCAD, J-W Power attempted to comply with the statute and filed some monthly statements and annual declarations for compressors leased out of the Jim Wells County yard to the Jim Wells County Appraisal District (“CAD”).
Before paying the assessed taxes to Frio County, J-W Power timely protested its FCAD appraisals each year under the mechanism provided in Chapter 41 of the Tax Code. See TEX. TAX CODE ANN. § 41.41(a) (providing broad authority to property owners to protest a property’s appraised value or “any other action of the chief appraiser, appraisal district, or appraisal review board that applies to and adversely affects the property owner”). J-W Power argued that FCAD was improperly taxing the DHEI compressors located in Frio County as business personal property under Tax Code section 22.01 despite the changes in the law requiring the Inventory County to tax the compressors. Each year’s protest was reviewed by the Frio County Appraisal Review Board (“ARB”), but each protest was denied. J-W Power did not seek judicial review of the Chapter 41 protests during the 2013–2016 tax years.
Following the Texas Supreme Court’s decision in EXLP Leasing, upholding the constitutionality of the 2011 legislative changes to the DHEI taxing method, J-W Power filed
2 A tax year coincides with a calendar year, but we specify tax years throughout this opinion to avoid confusion because the changes to the Tax Code required DHEI to be appraised based on the previous calendar year’s income generated. See TEX. TAX CODE ANN. § 23.1241(b).
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motions to correct the appraisal rolls for tax years 2013–2016 under the more limited relief found in Chapter 25 of the Tax Code with the Frio ARB. See TEX. TAX CODE ANN. § 25.25(c); EXLP Leasing, 554 S.W.3d at 583, 586. During this protest, J-W Power argued that its compressors leased to locations within Frio County should be removed from FCAD’s rolls because they had been subject to multiple appraisals in both Frio County and Jim Wells County (the Inventory County), and because the compressors were improperly classified as business personal property by the FCAD. The Frio County ARB denied J-W Power’s motions to correct the rolls. Unlike its prior Chapter 41 protests, J-W Power sought judicial review and sued FCAD.
In the district court, FCAD moved for summary judgment and raised five issues. It argued that:
(1) Section 25.25 of the Texas Property Tax Code is not the appropriate vehicle to challenge situs or appraisal categorization;
(2) J-W Power failed to exhaust its judicial remedies by [not] suing under TEX. TAX CODE § 42.01 in 2013–2016 when the ARB denied its protest that the compressors constituted heavy equipment dealer’s inventory;
(3) J-W Power’s § 25.25 motion constitutes an impermissible attempt to re-open the ARB’s 2013–2016 orders in violation of the principle of res judicata;
(4) JW Power admits that the compressors existed in the form and location described on the appraisal roll; and
(5) J-W Power’s Heavy Dealer Equipment Inventory Declarations provided in discovery prove as a matter of law that the property was not the subject of multiple appraisals in Frio or any other county.
J-W Power then moved for partial summary judgment stating that its compressors had already been taxed for tax years 2013–2016 as DHEI in Jim Wells County—the Inventory County for the compressors at issue. It sought refunds of the taxes paid to Frio County for those years on the compressors at issue—leased to locations within Frio County and improperly classified as
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business personal property, plus interest. J-W Power also sought a determination that it was entitled to court costs and attorney’s fees as a matter of law.
After considering the competing motions, the trial court partially granted and partially denied both parties’ motions. The trial court granted J-W Power’s motion insofar as it ordered that FCAD “remove the following compressors of [J-W Power]’s from its appraisal rolls for the following years: 2014: Compressor numbers 3800 and 5767; 2015: Compressor numbers 245, 3677, 4090, 4812, 4932, 5904, and 6291; 2016: Compressor numbers 3678 and 3681.” With the exception of the listed compressors, it granted FCAD’s motion for summary judgment, denied all other relief J-W Power requested in its motion, and ordered that J-W Power take nothing on its claims, except with respect to the listed compressors. The trial court did not state the grounds under which it granted and denied the motions. The order on the cross motions states that it disposes of all claims and parties, and that it is final and appealable. Both parties appealed.
On original submission of this appeal, we concluded that res judicata barred J-W Power’s claims because the earlier Chapter 41 denials precluded the later Chapter 25 motions. Frio Cnty. I, 692 S.W.3d 622. However, following its decision in J-W Power Co. v. Sterling County Appraisal District, 691 S.W.3d 466, (Tex. 2024), which held Chapter 25 motions are not barred by res judicata based on Chapter 41 protests, the Texas Supreme Court reversed our judgment and remanded the case for our consideration of the issues we did not reach. See Frio Cnty. II, 691 S.W.3d at 923.
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We must now consider, FCAD’s argument that the relief J-W Power seeks exceeds the scope of relief authorized by section 25.25(c). 3 J-W Power argues to the contrary that the rolls can be corrected under section 25.25(c) either because the compressors were subject to “multiple appraisals” or because they were included on the Frio County appraisal rolls even though they “did not exist in the form or at the location” described by those rolls. 4 See TEX. TAX CODE ANN. § 25.25(c)(2), (3). We provide our standard of review and then address the parties’ arguments regarding section 25.25(c).
ANALYSIS
I. Standard of Review We review a trial court’s ruling on a motion for summary judgment de novo. Tarr v.
Timberwood Park Owners Ass’n, Inc., 556 S.W.3d 274, 278 (Tex. 2018). The movant must show there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. TEX. R. CIV. P. 166a(a)(1). A plaintiff is entitled to traditional summary judgment on its own affirmative claim if it conclusively proves all essential elements of that claim. Compass Bank v. Durant, 516 S.W.3d 557, 565 (Tex. App.—Fort Worth 2017, pet. denied). Conversely, “[a] defendant who conclusively negates at least one of the essential elements of a cause of action or conclusively establishes an affirmative defense is entitled to [traditional] summary judgment.” Frost Nat’l Bank
3 Additionally, FCAD asserts an evidentiary issue. The appellate record, however, contains no indication that the trial court ruled on any of FCAD’s objections to J-W Power’s summary judgment evidence. Therefore, error is not preserved for our review. See TEX. R. APP. P. 33.1, 38.2; J-W Power Co. v. Duval Cnty. Appraisal Dist., No. 04-21- 00172-CV, 2022 WL 789345 at *2 (Tex. App.—San Antonio Mar. 16, 2022, no pet.) (mem. op.) (declining to address the Duval County Appraisal District’s complaints that the trial court erred by considering some of J-W Power’s evidence because the record contained no indication that the trial court ruled on the objections). 4 J-W Power and appraisal districts of several counties have presented similar arguments and issues in other appeals, including an appeal previously decided by our court. See Duval Cnty. Appraisal Dist., 2022 WL 789345; see also J- W Power Co. v. Henderson Cnty. Appraisal Dist. (Henderson Cnty. III), No. 12-22-00325-CV, 2025 WL 965963 (Tex. App.—Tyler Mar. 31, 2025, pet. denied) (mem. op.); J-W Power Co. v. Irion Cnty. Appraisal Dist. (Irion Cnty. III), 706 S.W.3d 544 (Tex. App.—Austin 2024, pet. denied); J-W Power Co. v. Sterling Cnty. Appraisal Dist. (Sterling Cnty. III), 706 S.W.3d 553 (Tex. App.—Austin 2024, pet. denied); J-W Power Co. v. Jack Cnty. Appraisal Dist. (Jack Cnty. III), No. 02-22-00082-CV, 2024 WL 5162690 (Tex. App.—Fort Worth Dec. 19, 2024, pet. denied) (mem. op.).
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v. Fernandez, 315 S.W.3d 494, 508 (Tex. 2010). Because there were competing motions for summary judgment filed, “each party bears the burden of establishing that it is entitled to judgment as a matter of law.” City of Garland v. Dall. Morning News, 22 S.W.3d 351, 356 (Tex. 2000). “When both parties move for summary judgment on the same issues and the trial court grants one motion and denies the other, we consider the summary judgment evidence presented by both sides, determine all questions presented, and if we determine that the trial court erred, render the judgment that the trial court should have rendered.” Gonzalez v. Janssen, 553 S.W.3d 633, 637 (Tex. App.—San Antonio 2018, pet. denied); see Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009). II. Applicability of Section 25.25 A. Applicable Law FCAD is responsible for appraising the total market value of property located in Frio County each year. See TEX. TAX CODE ANN. § 6.01. After FCAD determines the market value of the taxable property in the county, the Frio County ARB hears disagreements between property owners and FCAD about a property’s taxability and value. See TEX. TAX CODE ANN. § 6.41. Property owners generally have two direct means of seeking a change in the appraisal rolls— Chapter 41 protests and section 25.25 motions to correct the appraisal roll. Willacy Cnty. Appraisal Dist. v. Sebastian Cotton & Grain, Ltd., 555 S.W.3d 29, 40 (Tex. 2018). Chapter 41 gives property owners broad rights to protest a number of actions to the ARB, including “any other action of the chief appraiser, appraisal district, or appraisal review board that applies to and adversely affects the property owner.” TEX. TAX CODE ANN. §41.41(a). These protests “are broad in scope and weigh in favor of the property owner, placing the burden of establishing the value of the property on the appraisal district.” Willacy Cty. Appraisal Dist., 555 S.W.3d at 40. However, these protests
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are subject to strict timelines and the property owner “must file a notice of protest within thirty days of receiving notice of the appraised value.” Id. (citing TEX. TAX CODE ANN. § 41.44(a)(2)).
The more limited form of relief is found in section 25.25 of the Tax Code. TEX. TAX CODE ANN. § 25.25. These motions specifically allow the correction of already completed tax rolls and can only be filed under limited circumstances. The purpose “of section 25.25 is to permit the correction of objective, factual errors that would cause the payment of taxes based on the uncorrected records to be fundamentally unfair.” Willacy Cnty. Appraisal Dist., 555 S.W.3d at 41 (internal quotation marks omitted). Under this section, property owners have “up to five years to request that the ARB change the appraisal roll to correct: (1) clerical errors; (2) multiple appraisals; or (3) the inclusion of property that does not exist in the form or at the location described in the appraisal roll.” Benson Chevrolet, Inc. v. Bexar Appraisal Dist., 242 S.W.3d 54, 57 (Tex. App.— San Antonio 2007, no pet.); see TEX. TAX CODE ANN. §25.25(c).
If the challenge to the tax rolls at the ARB is unsuccessful, “[s]ection 42.01 of the Tax Code expressly provides that a property owner is entitled to appeal to the district court both a Chapter 41 and a section 25.25 determination by the ARB.” Benson Chevrolet, Inc., 242 S.W.3d at 57; see TEX. TAX CODE ANN. § 42.01(a). “An appeal of an ARB determination to the district court is a trial de novo, and the district court ‘shall try all issues of fact and law raised by the pleadings in the manner applicable to civil suits generally.’” Willacy Cty. Appraisal Dist., 555 S.W.3d at 50 (quoting TEX. TAX CODE ANN. § 42.23(a)).
B. Application Here, the trial court “tr[ied] all issues of fact and law raised by the pleadings” on the parties’
motions for summary judgment on this issue. See id. (internal quotation marks omitted); see also TEX. R. CIV. P. 166a(h). In its motion for summary judgment, FCAD asserted that the relief J-W
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Power sought exceeds the scope of relief authorized by section 25.25(c) because that subsection “is not the appropriate vehicle to challenge situs or appraisal categorization.” In contrast, J-W Power’s motion argued that “FCAD’s unlawful acts caused double appraisal of the property as a matter of law” and that “FCAD’s unlawful appraisal resulted in the inclusion of property not in the form or location described on the appraisal rolls.”
The summary judgment evidence shows that while compressors were leased and sent to locations in Frio County, J-W Power maintains its inventory for those compressors in Jim Wells County. Both parties recognize that the compressors constitute DHEI and that, under the statutory scheme for taxing DHEI, the tax situs for J-W Power’s compressors is the county where J-W Power maintains its inventory. See EXLP Leasing, 554 S.W.3d at 583; Duval Cnty. Appraisal Dist., 2022 WL 789345, at *3. J-W Power alleges that because of these facts, it is entitled to seek correction of the rolls under section 25.25(c).
We hold that J-W Power’s claims of multiple appraisals and incorrect form or location fall under the plain language of section 25.25(c)(2) and (3); therefore, J-W Power was permitted to seek relief under section 25.25(c). See Duval Cnty. Appraisal Dist., 2022 WL 789345, at *3 (holding section 25.25(c) relief was available for similar claims). Thus, the issues here are whether “J-W Power established as a matter of law that the [Frio] County appraisal rolls for tax years 2013– 2016 should be corrected because they caused ‘multiple appraisals of a property in that tax year,’ or they ‘inclu[ded] property that does not exist in the form or at the location described in the appraisal roll.’” Id. (quoting TEX. TAX CODE § 25.25(c)(2), (3)); see also TEX. R. CIV. P. 166a(h). Conversely, FCAD could show that “it was entitled to judgment as a matter of law by conclusively demonstrating that J-W Power was not entitled to relief under section 25.25.” Duval Cnty.
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Appraisal Dist., 2022 WL 789345, at *3 (citing TEX. R. CIV. P. 166a(c), 50 Tex. B.J. 857 (Tex. 1987, amended 2026)). III. Section 25.25(c)(2) Appraisal Roll Corrections: Multiple Appraisals “Our conclusion that J-W Power was entitled to seek relief under section 25.25(c) does not necessarily mean it was entitled to obtain relief under that statute.” Duval Cnty. Appraisal Dist., 2022 WL 789345, at *4. To determine if J-W Power is entitled to relief, we must closely review the summary judgment evidence. See id. The parties’ dispute whether the summary judgment evidence established “multiple appraisals of a property in that tax year,” for each of the tax years between 2013 and 2016. See TEX. TAX CODE § 25.25(c)(2). J-W Power argues that for tax years 2013–2016, the compressors appraised in Frio County as business personal property were also appraised as DHEI in Jim Wells County. J-W Power claims that because it filed DHEI declarations for some compressors’ initial leases, it necessarily meant that all DHEI appraised by other counties resulted in multiple appraisals. FCAD argues that the summary judgment evidence does not show multiple payments in multiple counties in large part because J-W Power failed to comply with DHEI reporting requirements.
A. Applicable Law
Generally, tangible personal property is taxable by a taxing unit “if it is located in the unit on January 1 for more than a temporary period.” TEX. TAX CODE ANN. § 21.02. By default, taxable property is appraised at its market value. TEX. TAX CODE ANN. § 23.01. However, the method to appraise and tax DHEI is found in sections 23.1241 and 23.1242 of the Texas Tax Code. TEX. TAX CODE ANN. § 23.1241–42. To compute the property tax for DHEI, market value is determined by “the total annual sales, less sales to dealers, fleet transactions, and subsequent sales, for the 12- month period corresponding to the preceding tax year, divided by 12.” TEX. TAX CODE ANN.
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§ 23.1241(b) (2025). Total annual sales means “lease and rental payments received for each lease or rental of heavy equipment inventory in a 12-month period.” TEX. TAX CODE ANN. § 23.1241(a)(9)(B). The Tax Code requires the owner of leased DHEI to pre-pay taxes to the county where the inventory is held based on the revenue earned from the lease each month. See TEX. TAX CODE ANN. § 23.1242(b). By statute, a DHEI owner determines the taxes to be paid on each item leased, charges the client who is leasing the equipment with the tax amount, then remits that payment to the county where the inventory is maintained to be deposited into an escrow account. See id. The CAD uses the statements filed by the DHEI-holder in the previous calendar year to determine the appraisal value of the DHEI for the current tax year. See id. The CAD will then take the prepaid tax from the escrow account and either charge the DHEI-holder for any additional tax or remit payment for tax overpaid. See id.
This statutory framework “plainly calls for prepayments based on the monthly revenue generated by a dealer’s entire inventory, regardless of the physical location of individual units.” EXLP Leasing, LLC, 554 S.W.3d at 584. “It necessarily follows that those prepayments—and the dealer’s ultimate tax liability—can be made and incurred in only one county.” Id. “Otherwise, dealers would face double or greater taxation when paying taxes on an entire inventory in every county where a unit of property is located.” Id. “[W]hile the prepayments are based on the monthly revenue generated by a dealer’s entire inventory, regardless of the physical location of individual units, the individual units still must be accounted for, no matter their respective locations.” Henderson Cnty. III, 2025 WL 965963 at *5 (citing TEX. TAX CODE ANN. § 23.1241(a)(2); EXLP Leasing, 554 S.W.3d at 584; Duval Cnty. Appraisal Dist., 2022 WL 789345, at *5).
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B. Summary Judgment Evidence In FCAD’s motion for summary judgment, it argues that J-W Power was not subject to multiple appraisals in Frio County as a matter of law. In support of its argument, FCAD included several pieces of evidence. First, Luciano Gonzales, Jr., Chief Appraiser of FCAD, provided via affidavit the Frio County appraisal rolls for tax years 2013–2016, showing all compressors identified as being owned by J-W Power, located in Frio County, and appraised as business personal property tax by FCAD. The rolls show the following compressor appraised by tax year: 5
TAX
2013 2014 2015 2016 YEAR
6091 6289 6289 7118 6287 6293 6294 6289 6289 6294 6305 6294 6293 6295 6346 6346 6294 6305 6347 6347 COMPRESSOR NUMBER
6295 6346 236 236 6305 6347 3800 3800 6306 236 245 3677 6346 3800 3677 4812 6347 5767 4090 4932 4812 5904
4932 6291
5904 3678
6291 3681
3149
6293
7119
7120
FCAD also includes a November 28, 2018 affidavit from Kavin Tubbs and deposition testimony from Tubbs dated October 29, 2020. Tubbs served as the Vice President for J-W Power and was its corporate representative in this case. While his affidavit asserts J-W Power had
5 We created the following table by reviewing the roll and extracting the pertinent information.
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complied with the provisions in section 23.1241 and 1242, in deposition testimony, Tubbs admits that due to a misunderstanding in the law, J-W Power only reported and paid tax on leases to Jim Wells County for the initial month of any lease.
The summary judgment evidence filed by both parties includes the annual DHEI declarations J-W Power filed in Jim Wells County which show the company reported nine compressor leases in tax year 2013, thirteen compressor leases in tax year 2014, twenty-eight compressor leases in tax year 2015, and ten compressor leases in tax year 2016. These annual statements do not list individual compressors. J-W Power and FCAD’s evidence also includes the monthly DHEI tax statements J-W Power filed with Jim Wells for initial lease months to prepay tax for the following tax year. These monthly tax statements show the following compressors were reported to Jim Wells in a month within the listed calendar years to prepay taxes due the following year (i.e., in the listed tax year): 6
6 As with the previous table, we created the following table from pertinent summary judgment evidence.
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CALENDAR
2013 2014 2015 2016 YEAR
TAX YEAR 2014 2015 2016 2017 64 2687 2660 4812 5767 4934 245 4112 4841 4807 3148 4300 4948 1675 3868 5050 1814 3868 6290 5650 3148 6295 3681 1260 3682 4177 2348 245 3678 2666 6344 4017 COMPRESSOR NMUMBER
3800 5904 4808 1813
4932
3724
5258
4804
5080
4153
3678
4812
4805
6293
292
3149
3677
4359
4090
6288
J-W Power provided annual tax statements from Jim Wells County, which include a description of the property appraised by Jim Wells CAD and their respective account numbers. Also included in the summary judgment evidence is a deposition from Joseph Vela, Chief Appraiser and Tax-Assessor-Collector for Jim Wells CAD. In his deposition testimony, Vela states that Jim Wells CAD created a DHEI tax account for J-W Power in 2013. The summary judgment evidence includes a bill for this account for tax year 2016 (account number 0001308-584-0584). Vela further stated that on the Jim Wells CAD tax rolls, the accounts for “miscellaneous machinery
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and equipment” (account number 0001308-501-0501), “vehicles” (account number 0001308-510- 0103), “office equipment” (account number 0001308-530-0105), and “inventory” (account number 0001308-580-0580) would not include any compressors.
Additionally, J-W Power included a revenue spreadsheet, which identified compressors leased to various counties from the Jim Wells yard for calendar years 2013–2016. This spreadsheet lists the compressors by number and indicates where they were leased each month during the relevant years. According to the revenue sheet, sixty-five compressors were leased in calendar year 2012, eighty-eight compressors in calendar year 2013, eighty-eight in 2014, and eighty-nine in 2015.
C. Application
a. Tax Years 2013–2015
For Jim Wells County to appraise DHEI under the special statutory scheme, J-W Power must have made a prepayment. See TEX. TAX CODE ANN. § 23.1242(b); EXLP Leasing, 554 S.W.3d at 583. Jim Wells CAD would then determine the applicable tax liability, apply the amount of J-W Power’s prepayment, and then bill J-W Power for any deficiency or credit it for any overpayment. See TEX. TAX CODE § 23.1242(a–c), (h); EXLP Leasing, 554 S.W.3d at 583–84. The summary judgment evidence does not show this process occurred. Instead, it shows the process may have begun but was not completed for tax years 2013, 2014, and 2015.
In February 2013, J-W Power filed an annual DHEI declaration with Jim Wells CAD claiming it had nine initial leases for all counties served by the Jim Wells yard in the previous calendar year. Because there were no monthly declarations filed the previous year, there is no indication of which compressors were leased through those nine leases. For tax year 2014, J-W Power reported thirteen compressor leases to Jim Wells CAD. Also for tax year 2014, J-W Power
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reported initial leases for units 3800 and 5767 and prepaid taxes to Jim Wells County in connection with these compressors. These units were added to FCAD’s rolls for the 2014 tax year. Likewise for tax year 2015, J-W Power reported initial leases for units 3677, 4090, 4812, 4932, 5904, and 6291 and prepaid taxes in connection with these units. These units appear on the 2015 tax roll for Frio County.
While J-W Power filed annual DHEI declarations and monthly statements for initial leases with Jim Wells County, these filings do not show that Jim Wells actually appraised compressors as DHEI or assessed a DHEI tax. See Sterling Cnty. III, 706 S.W.3d at 560 (“[t]he declarations and monthly statements are but ‘precursors’ to the proper authorities’ appraisal tasks under the special appraisal scheme for DHEI.”). While J-W Power attempted to prepay taxes with its monthly filings to Jim Wells County, these prepayments alone do not establish appraisals under Chapter 25. In fact, the summary judgment evidence shows that Jim Wells County did not appraise any DHEI property during these tax years despite these prepayments. In 2013–2015, the only property appraised by Jim Wells County were “inventory,” “vehicles,” “office equipment,” and “Misc. M&E.” As confirmed by Vela, these accounts do not include any appraisals for DHEI. Altogether, the evidence shows only prepayments, not actual appraisals by Jim Wells County, therefore, even considering the Frio County appraisals on some of the compressors listed in J-W Power’s filings with Jim Wells County, the evidence does not establish multiple appraisals. See Id. (“Only after ‘the taxing unit prepares the annual tax bill,’ . . . has the appraisal district conducted the appraisal task called for by the DHEI special appraisal scheme.” (quoting EXLP Leasing, 554 S.W.3d at 577, 583–84)).
“We interpret [multiple appraisals] to mean that the same property has actually been appraised multiple times in the same tax year by multiple appraisal districts.” Jack Cnty. III, 2024
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WL 5162690, at *10. Moreover, “until the billing and payment of DHEI taxes is implemented by an appraisal district, there is no appraisal under the DHEI appraisal scheme.” Jack Cnty. III, 2024 WL 5162690, at *12 (citing Sterling Cnty. III, 706 S.W.3d at 560–61; Irion Cnty. III, 706 S.W.3d 550–52). We “do not presume double taxation merely because it is semantically possible[.]” Bosque Disposal Sys., LLC v. Parker Cty. Appraisal Dist., 555 S.W.3d 92, 97 (Tex. 2018). “Instead, evidence about what property was or was not included in each appraisal account should be consulted to determine whether double taxation has in fact occurred.” Id. (internal quotation marks omitted).
Because the summary judgment evidence conclusively proves that Jim Wells County did not assess a DHEI tax for tax years 2013–2015, J-W Power’s “multiple appraisals” ground was negated, and FCAD is entitled to judgment as a matter of law on that ground for tax years 2013– 2015. The trial court therefore erred to the extent it granted J-W Power’s motion for summary judgment on any compressors for tax years 2013–2015.
b. Tax Year 2016
In contrast to tax years 2013–2015, the summary judgment evidence shows that Jim Wells County appraised property reported as DHEI for tax year 2016. Unlike the previous years, the Jim Wells County tax bill for 2016 shows an assessed value for a DHEI account number: 0001308- 584-0584. While the DHEI account does not specify individual compressors, the summary judgment evidence shows that compressor units 3681 and 3678 were included in the monthly declarations J-W Power filed with Jim Wells County the prior calendar year. Because these two units (3681 and 3678) appear on Frio County’s tax rolls for the 2016 tax year as business personal property, the summary judgment evidence shows that Frio County also appraised them. See TEX. TAX CODE ANN. § 21.02. Therefore, on this evidence, J-W Power has established as a matter of
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law that units 3681 and 3678 were appraised by both taxing authorities for tax year 2016. The trial court’s order is affirmed to the extent it orders Frio County to remove compressors 3678 and 3681 from the Frio County tax rolls for tax year 2016. IV. Section 25.25(c)(3) Appraisal Roll Corrections: Form and Location Section 25.25(c)(3) authorizes corrections for “the inclusion of property that does not exist in the form or at the location described in the appraisal roll.” TEX. TAX CODE ANN. § 25.25(c)(3). J-W Power argues FCAD improperly included on its rolls property that does not exist in the form or at the location described in the Frio County appraisal rolls because the compressors are not tangible personal property in form, but rather inventory that exists only in Jim Wells County.
In J-W Power Co. v. Duval County Appraisal Dist., we rejected a similar argument stating:
J-W Power’s argument attempts “an end run around the rule that 25.25(c)(3) cannot be used to challenge the extent to which a certain type of property, physically located in an appraisal district, is taxable in that appraisal district.” Duval Cnty. Appraisal Dist., 2022 WL 789345, at *7.
The plain meaning of “property that does not exist at the location described in the appraisal roll” obviously refers to the actual, physical presence of property at the place described in the appraisal roll. Defining the term “location” as meaning actual, physical location restricts section 25.25(c)(3) to those cases in which property did not physically exist at the appraisal roll location at any time during the taxable year. Thus, if there is some existence at the location, section 25.25(c)(3)
does not allow a change in the appraisal roll. To hold otherwise would not give effect to the words “does not exist” in section 25.25(c)(3).
Id. (citing Harris County Appraisal District v. Texas Gas Transmission Corp., 105 S.W.3d 88, 97 (Tex. App.—Houston [1st Dist.] 2003, pet. denied)).
Therefore, in accordance with our prior opinion, we reject J-W Power’s argument as to section 25.25(c)(3), and hold the trial court erred to the extent it ordered FCAD to remove compressors because they did not exist in the form or location described in the Frio County appraisal rolls.
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CONCLUSION
We reverse the trial court’s judgment to the extent it ordered FCAD to remove any compressors from its appraisal rolls for the tax years 2014 and 2015, and we render judgment that J-W Power take nothing on its claims related to these compressors the trial court erroneously removed. We otherwise affirm the trial court’s judgment. 7
H. Todd McCray, Justice
7 Our disposition results in a judgment less favorable to J-W Power than the trial court’s judgment. To the limited extent J-W Power raises the matter of attorney’s fees, it does so in the context of reversal of the trial court’s judgment in its favor and a remand for a determination of attorney’s fees. [Because we do not reverse the trial court’s judgment in J-W Power’s favor, we do not disturb the trial court’s ruling on attorney’s fees. See TEX. R. APP. P. 38.1(i), (j), 38.2(a)(1), 47.1; cf. Lance v. Robinson, 543 S.W.3d 723, 746 (Tex. 2018) (holding appellant waived challenge to award of attorney’s fees to one appellee by raising challenge only as to attorney’s fees awarded to another appellee).