LIBRARY. , A & M COLLEGE. CAQQPUS. E123-8M-L180 EEXAS AfiRlCULTURAL EXPERIMENT STATION A. B. CONNER, DIRECTOR COLLEGE STATION, BRAZOS COUNTY. TEXAS BULLETIN NO. 507 I A APRIL, 1935 DIVISiON OF FARM AND RANCH ECONOMICS Tax Delinquency on Farm Real Estate in Texas Agricultural 6 Mechanical Colleae of Tam ’ College Station. lanes. AGRICULTURAL AND MECHANICAL COLLEGE OF TEXAS T. O. WALTON, President Administration : A. B. Conner, M. S., Director R. E. Karper, M. S., Vice Director Clarice Mixson, B. A., Secretary M. P. Holleman, Chief Clerk D. R. McDonald, Asst. Chief Clerk Chester Higgs, Executive Assistant Howard Berry, B. S., Technical Asst. Chemistry: G. S. Fraps, Ph. D., Chief; State Chemist S. E. Asbury, M. S., Chemist J. F. Fudge, Ph. D., Chemist E. C. Carlyle, M. S., Asst. Chemist T. L. Ogier, B. S., Asst. Chemist A. J. Sterges, _M. S., Asst. Chemist Ray Treichler, M. S., Asst. Chemist W. H. Walker, Asst. Chemist Velma Graham, Asst. Chemist Jeanne F. DeMottier, Asst. Chemist W. H. Garman, M. S., Asst Chemist A. R. Kemmerer, Ph. D., Asst. Chemist A. W. Walde, Ph. D., Asst. Chemist Horticulture: S. H. Yarnell, Sc. D., Chief Range Animal Husbandry: J. M. Jones, A. M. Chief B. L. Warwick, Ph. D., Breeding Investiga. S. P. Davis, Wool and Mohair J. H. Jones, B. S., Animal Husbandman Entomology: F. L. Thomas, Ph. D., Chief; State Entomologist H. J. Reinhard, B. S., Entomologist R. K. Fletcher, Ph. D., Entomologist W. L. Owen, Jr., M. S., Entomologist J. N. Roney, M. S., Entomologist J. C. Gaines, Jr., M. S., Entomologist S. E. Jones, M. S., Entomologist F. F. Bibby, B. S., Entomologist "R. W. Moreland, B. S., Asst. Entomologist C. E. Heard, B. S., Chief Inspector C. J. Burgin, B. S., Foulbrood Inspector Agronomy: E. B. Reynolds, Ph. D., Chief R. E. Karper, M. S., Agronomist w n10‘; @- Veterinary Science: *M. Francis, D. V. M., Chief H. Schmidt, D. V. M., Veterinarian "F. P. Mathews, D. V. M., M. S., Veterinarian Plant Pathology and Physiology: J. J. Taubenhaus, Ph. D., Chief W. N. Ezekiel, Ph. D., Plant Pathologist L. B. Loring, M. S., Asst. Plant Pathologist G. E. Altstatt, M. S., Asst. Plant Pathologist "Glenn Boyd, B. S., Asst. Plant Pathologist Farm and Ranch Economics: L. P. Gabbard, M. S., Chief W. E. Paulson, Ph. D., Marketing C. A. Bonnen, M. S., Farm Management ?,E**W. R. Nisbet, B. S., Ranch Management **A. C. Magee, M. S., Farm Management Rural Home Research: Jessie Whitacre, Ph. D., Chief Mary Anna Grimes, M. S., Textiles Sylvia Cover, Ph. D., Foods Soil Survey: "W. T. Carter, B. S., Chief E. H. Templin, B. S., Soil Surveyor J. W. Huckabee, B. S., Soil Surveyor I. C. Mowery, B. S., Soil Surveyor Botany: V. L. Cory, M. S., Acting Chief Swine Husbandry: Fred Hale, M. S., Chief Dairy Husbandry: O. C. Copeland, M. S., Dairy Husbandman Poultry Husbandry: R. M. Sherwood, M. S., Chief J. R. Couch, M. S., Assoc. Poultry Husb. Paul D. Sturkie, B. S., Asst. Poultry Husb. Agricultural Engineering: H. P. Smith, M. S., Chief Main Station Farm: G .T. McNess, Superintendent Apiculture (San Antonio): H. B. Parks, B. S., Chief A. H. Alex, B. S., Queen Breeder Feed Control Service: F. D. Fulle M. S., Chief James Sullivan, Asst. Chief. P. C. Mangelsdorf, Sc, D., Agronomist $_ ])_ Pearce, secretary D. 'T. Killough, M. S., AgrOHOHHSt _ J_ H_ Rogers, Feed Inspector J. l‘. Vantlne, Jr., M. S., Asst. Agronomist K_ L_ Igrkland, B_ S" Feed Inspector J. ‘O. Beasley, M. S., Asst. Agronomist S_ D_ Reynolds, Jr" Feed Inspector Pubhcatwns‘ , P. A. Moore, Feed Inspector A- D' Jackson» Chlef E. J. Wilson, B. S., Feed Inspector H. G. Wickes, D. V. M., Feed Inspector J. K. Francklow, Feed Inspector SUBSTATIONS No. 1, Beeville, Bee County: R. A. Hall, B. S., Superintendent No. 2, Tyler, Smith County: P. R. Johnson, M. S., Superintendent No. 9, Balmorhea, Reeves County: J. J. Bayles, B. S., Superintendent No. 10, College Station, Brazos County: R. M. Sherwood, M. S., In Charge "B. H. Hendrickson, B. S., Sci. in Soil Erosion L. J. McCall, Farm Superintendent "R. W. Baird, M. S., Assoc. Agr. Engineer No. 3, Angleton, Brazoria County: R. H. Stansel, M. S., Superintendent H. M. Reed, B. S., Horticulturist No. 4, Jefferson County: R. H. Wyche, B. S., Superintendent "H. M. Beachell, B. S., Junior Agronomist No. 5, Temple, Bell County: Henry Dunlavy, M. S., Superintendent C. H. Rogers, Ph. D., Plant Pathologist H. E. Rea, B. S., Agronomist ' "E. B. Deeter, B. S., Soil Erosion "P. L. Hopkins, B. S., Junior Civil Engineer No. 6 Denton, Denton County: P. B. Dunkle, M. S., Superintendent "I. M. Atkins, B. S., Junior Agronomist No. 7, Spur, Dickens County: R. E. Dickson, B. S., Superintendent B. C. Langley, M. S., Agronomist No. 8, Lubbock, Lubbock County: D. L. Jones, Superintendent Frank Gaines. Irrig. and Forest Nurs. Members of Teaching Staff Carrying G. W. Adriance, Ph. D., Horticulture W. Bilsing, Ph. D., Entomology . Scoates, A. E., Agricultural Engineering . K. Mackey, M. S., Animal Husbandry . G. Reeves, Ph. D., Biology S. Mogford, M. S., Agronomy R. Brison, M. S., Horticulture ‘Dean, School of Veterinary Medicine. WFSUK>U§II No. ll, Nacogdoches, Nacogdoches County: H. F. Morris, M. S. Superintendent **No. 12, Chillicothe, Hardeman County: **J. R. Quinby, M. S. Superintendent “J. C. Stephens, M. A., Asst. Agronomist No. l4, Sonora, Sutton-Edwards Counties: W. H. Dameron, B. S., Superintendent I. B. Boughton, D. V. M., Veterinarian W. T. Hardy, D. V. M., Veterinarian O. L. Carpenter, Shepherd “*0. G. Babcock, B. S., Asst. Entomologist No. 15, Weslaco, Hidalgo County: W. H. Friend, B. S., Superintendent S. W. Clark, B. S., Entomologist W. J. Bach, M. S., Plant Pathologist J. F. Wood, ‘B. S., Horticulturist No. 16, Iowa Park, Wichita County: C. H. McDowell, B. S., Superintendent L. E. Brooks, B. S., Horticulturist No. 19, Winter-haven, Dimmit County: E. Mortensen, B. S., Superintendent "*L. R. Hawthorn,.M. S., Horticulturist Cooperative Projects on the Station: W. R. Horlacher, Ph. D., Genetics J. H. Knox, M. S., Animal Husbandry A. L. Darnell, M. A., Dairy Husbandry R. O. Berry, B. S., Biology R. T. Stewart, Ph.D., Agronomy V. A. Little, M. S., Entomology TAs of March l. 1935 "In cooperation with U. S. Department of Agriculture. fln cooperation with Texas Extension Service. ‘To cooperation with State Department of Agriculture. Delinquent taxes accruing in Texas since 1885 have reached the enormous sum of $141,783,000. The most alarming aspect of the problem is that more than half of this sum has accumulated dur- ing the past two years. Classified according to “solvent” and “insolvent” about 75 per cent of delinquent taxes are of the solvent class and 25 per cent the insolvent. During the past half century we have col- lected about 45 per cent of the solvent class and only 8 per cent of the insolvent class—thev first instance a very poor record and the latter a deplorable failure. . From a complete survey of tax delinquency on farms, in 120 selected counties, for the period 1928 to 1932 inclusive, it was found that the number of farms permitted to become delinquent annually increased from 33,267 in 1928 to 124,192 in 1932. In all there were 364,238 cases 0f delinquencies represented in the five-year pflriod. Out of this number of cases subject to sale for taxes, only 932 tax sales were recorded. The risk of losing the farm from a failure to pay the taxes being no greater than this is undoubtedly a cause of the failure to pay. Ninety counties out of 119 showed “unknown” delinquent acreages ranging from one to forty per cent of the total delinquent acreage in the county. In 12 counties “unknown” delinquent farm properties comprised more than 40 per cent of all farm delinquen- cies. This reveals an extremely haphazard method of assessment. The following are given as the more important causes of the tax delinquent situation in Texas: declining agricultural as well as other commodity prices and rising taxes; faulty assessment and g collection practices; periodic remission of penalties and interest; the uncertainty of tax titles; the indifference, procrastination, or misfortune of the taxpayer; and finally, the failure of our tax system to include and properly harmonize the two fundamental bases of taxation-—benefit and ability. The situation as revealed in this study suggests the need for certain changes not only in the administrative and legal aspects of taxation, but in the fundamental bases of taxation with a view of a greater equalization of taxes. Among the more important changes recommended are: an active and responsible participation by the State in the assessment and collection of taxes; the keep- ing of a complete and continuous inventory of taxable property by counties; that collection procedure be made simple, certain, and convenient; that court procedure relative*to tax sales be simplified and harmonized with the enforcement of tax laws; that penalties be reasonable and certain and their remission be avoided; and finally, that collectors be appointed on a competitive basis. CONTENTS Page Introduction _____________________________ ........ _______________________ _: ____________________________________ -. 5 Purpose of Study >* ________________________________________________ -_ 5 Source of Data and Method of Proceduremm 5 Amount and Trend of Delinquent Ad Valorem Taxes in the State and Minor Governmental Units ....... __ 7 Tax Delinquency Classified as t0 “Solvents” and “Insolvents” ............. -- 8 Tax Delinquency of Farm Real Estate“. 9 Farm Tax Sales During the Period Studied _______________________________________________ ,- 1O Percentage of Farm Acreage Delinquent _________ .- ___________________________________________ I11 Tax Delinquency as Related to Type-of-Fhrming Areas __________________________ __14 Problem of “Unknown” Properties in Tax Delinquency on Farm Real Estate . 17 Some of the More Important Causes of Tax Delinquency ___________________ I‘ ______ n20 Suggestions for Improvement ..... -_ 23 BULLETIN NO. 507 APRIL, 1935 TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS L. P. GABBARD There is outstanding in Texas today delinquent taxes amounting to approximately $141,783,000. This amount has accrued since 1885, and the serious aspect of it is that tax delinquency has more than doubled since 1931. The increase in tax delinquency of farm real estate has been especially rapid during the past few years. For example, the number of farms becoming delinquent in 120 representative counties in Texas increased from 33,267 in 1928 to 124,192 in 1932, an increase of almost three- fold. The acreage delinquent showed an even greater increase; 4,588,000 acres in 1928 and 32,603,000 in 1932, a sixfold increase. The annual amount delinquent on farms in these counties was more than, six times greater in 1932 than in 1928. Perhaps there is no more baffling and perplexing problem in public finance today than that of tax delinquency. We had come to accept a limited amount of delinquency as a normal condition in tax matters, but the widespread and rapid increase of tax delinquency in recent years has become alarming. Its extent in many fiscal units has demoralized government credit. Not only has the tax delinquent situation been tragical for a great many individuals, but it threatens a collapse of the general property tax, and challenges property rights and the institution of private property itself. Purpose of Study The menacing challenge confronting us in the delinquent tax situation cannot be ignored. Certain adjustments are inevitable and imperative. The general purpose of this report is to make available statistical data relative to the scope, nature, and trend of tax delinquency in Texas. The major emphasis has been placed on tax delinquency of -farm real estate in 120 selected counties. Specifically, the number of farms delinquent, the amount of delinquency, the amount paid, etc. annually and for the period 1928 to 1932, inclusive, are shown. The report is concluded with a brief discussion of the more important causes of tax delinquency in Texas, and with suggestions for the improvement of certain undesirable situations. Source of Data and Method of Procedure The data presented showing the general delinquency situation of th‘e State were taken from the State Auditor's Annual Reports, and from the State Comptroller’s Annual Reports. The data relating specifically to farm real estate delinquency were secured through a Federal Civil Works Administration project, sponsored cooperatively in Texas by the Bureau of Agricultural Economics and the Texas Agricultural Experiment Station. Grateful acknowledgment is made of the valuable assistance rendered by these Federal agencies, and by the Texas Relief Commission. Special com- mendation is due 600 men and women who conscientiously helped to super- 6 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION vise and compile the data from the county records in the 12,0 selected counties surveyed. Appreciation is also expressed to the county officials in these counties, particularly, the tax collector, county clerk, and tax assessor, who through their sympathetic cooperation contributed much to the success of the project. y _ _ The counties included in the survey are shown in Figure 1., These counties were selected with a view not only of their being representative Fig. 1. Shaded portions show the counties in which the survey of tax delinquency of farm real estate was conducted. of the State as a whole, but also of the several type-of-farming areas in Texas, _ The general procedure followed was to" make a rather complete record of each farm of three acres and over, that became delinquent each year in the "county for the period 1928 to 1932, inclusive. Lands platted for urban "development were not includedeven though used for agricul- tural purposes. The details of the schedule. included such items as: owner’s name and address, legal description of property; number of acres "“I‘""I wfifiF-"TIF ‘"~""'.\'v C‘)? TF1" " ' ' "" " ' f"“‘11§f“-“‘ ' ‘ i . Q. h ' v but also for periods prior to last fiscal year. a are known. ing system used by these local units. ‘active participation and direct responsibility in the assessment and col- ilfiincluding 1933 amounted t0 $141,783,000. TAX DELINQUENCY ON FARM REAL ESTATE INTTEXAS ‘ > .7 in the farm; assessed valuation of land and buildings; taxes delinquent during the year; and payment of delinquent taxes, etc. This survey was made during the first four months of 1934. Delinquent taxes for the 1933 levy were not included, since the penalty on such un- paid levies did not apply until February 1, 1934. In this study February 1 has been considered as the date of technical delinquency of unpaid taxes levied for the; previous year. It should be noted that the delinquent tax roll (D. T. R.) is made up as of June 30. It does not give a complete list of all taxpayers that become subject to the payment of a penalty on February 1. A record of those becoming delinquent February 1 but pay- ing their taxes before July of that year were secured by referring to re- demption certificates. , ~ The collection of the data was supervised by a county project leader, who in most instances was a person familiar with county records and local conditions and situations. Schedules were carefully edited, particularly in the early stages of the survey, so as to insure as high a degree of accuracy as possible within the county and» the greatest possible uni- formity in the procedure from county to county. ' Amount and Trend of Delinquent Ad Valorem Taxes in the State and i Minor Governmental Units V A detailed annual report of tax delinquency for the State andlocal units of government was made possible by House Bill "575 enacted during the regular session of the Forty-Second Legislature. The first report, that for 1931, made an effort to secure a record of outstanding ad valorem tax delinquency-which had accrued since 1885 in the State and in all minor subdivisions. The subsequent reports have requested all ‘govern- mental units to report not only tax delinquency for the last fiscal ‘year, Table 1 shows the results of these reports for the past three “years, 1931, 1932, and 1933. Before commenting on the details of this Table, in fairness to the reader ‘and to the State Auditor’s office, I wish to state thatonly reasonable accuracy is claimed for the figures given. One can readily appreciate the problem of securing even a reasonable degree of accuracy and completeness in a report of this nature when some of the more troublesome difficulties For example, the 1933 report is m.ade up from approximately 9,000 local units of government in Texas. There is no uniform account- The State has never taken an lection of ad valorem taxes, not even in county taxes in which the State and county are jointly financially involved. The multiplicity of govern- mental units complicates the problem of. securing complete and accurate reports. a It will be observed from Table 1 that the total outstanding ad valorem tax delinquency for the State and all minor governmental units up to and This is more than double the amount shown for the entire period from 1885 to 1931, inclusive. It should 8 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION be noted that slightly more than 80 per cent of the entire amount of out- standing tax delinquencies is owing to the different kinds of local govern- mental units. The remainder, slightly more than $26,000,000, is owing to Table 1. Delinquent taxes outstanding for state and minor governmental units, 1931-19331 1931 1932 1933 Governmental ___ unit In Percent- In Percent- In Percent- thousand age of thousand age of thousand age of dollars ‘ total dollars total dollars total l l l State l $25,050? l 38.3 l 20,713 I 17.3 $27,410 19.3 a I I Total County I 31,161 26.04 ' 34,275 24.2 Cities and Town 20,884 31.9 28,252 23.6 32,053 22.6 School Districts: l l Independent 10,118 l 15.4 19,125 l 15.9 24,410 17.2 I l l I l l Common 2,426 l 3.7 l 4,817 4.02 l 5,470 3.86 l l l Rural High 5 l 0076 | 249 .20 l 482 .34 l l l l l l Road Districts l 2,407 l _ 3.6 5,290 l 4.4 | 5,461 l 3.86 Water Districts: l l ' l l Water Control and l l l l Improvement 1,978 l 3.02 2,028 1.69 l 3,008 | 2.13 - l I Water Improvement 2,203 1.84 2,096 l 1.48 Fresh Water Supply 24 .036 43 .035 55 .04 Irrigation 787 1.2 339 .28 55 l .04 Navigation 272 .41 760 .63 929 .66 Conservation and . Reclamation 30 .045 28 .023 778 .55 Levee Improvement 886 1.3 3,829 3.2 4,364 3.08 Drainage 502 .76 812 .67 937 .66 ‘ I Totals ~ 65,369 100.00 119,649 100.00 141,783 l 100.00 Note: Figures for 1931 and 1932 taken from State Auditor’s Report for 1931 and 1932 respectively. Figures for 1933 compiled from unpublished reports in the State Auditor’s office. All items have been reduced to the nearest thousand. lEach year includes delinquency accumulating since 1885. 2This amount includes both State and_ County Taxes. the State. By far the larger amount of delinquency in the local units is found in the county, cities, and towns, independent and common school districts, and road districts. The other local units are of a specialized nature and are peculiar to restricted local areas. 991 Tax Delinquency Classified as to “Solvents” and “Insolvents In the vernacular of the tax office the terms “solvent” and “insolvent” have real significance as related\to the collection of taxes. For example, if one owes taxes on both personal property and real estate, and owes lThe Texas Tax Problem, ch. XII, DD. 170-174, Armistead. TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS 9 poll taxes, the taxes constitute a lien upon the real property which may be sold to satisfy the entire tax bill. A taxpayer under such circumstances is classed as “solvent”. If, however, one owes taxes only on personal property and owes poll taxes, in practice, he may pay the taxes or not as he likes. Such a taxpayer is classed as “insolvent”. The general procedure at the end of each county tax collector’s- fiscal year is for the collector to list all uncollected taxes against insolvents, make an affidavit that he cannot find such personal property, and send the list along with the affidavit to the State Comptroller, whereupon the county collector is relieved of“ further responsibility of collecting such taxes. Under such conditions one would naturally expect a high percentage of delinquency of such taxes and a low percentage of collection after their having be- come delinquent. A brief analysis of accrued state and county delinquency for the period 1885-1933 is presented in this connection. Table 2 shows a summary of delinquent ad valorem and poll taxes owing the State and counties from 1885 to 1932, inclusive, classified as to “sol- vents” and “insolvents”. Of the $90,306 delinquency accruing during the period, 74.4 per cent was of the “solvent” class, and 25.6 per cent of the “insolvent” class. As to collections it is to be observed that 35.7 Table 2. Summary of delinquent ad valorem and poll taxes owing ‘the state and counties from 1885 to 1932 inclusive, showing accruals and totalcollections of delinquent taxes when secured by real property, and when secured by personal propertyl Total Solvents Insolvents Items Per- Per- Per- Amount cent- Amount cent- Amount cent- age age age Accruals of Delinquencies I I I 1885 t0 1932, Inclusive I $90,323,306 I 100.00 $67,233,783 100.00 I $23,089,518 I 100.00 Collections of Delin- I quencies not Including| I | Penalties and Interest 32,227,842 I 35.7 I 30,299,707 45.1 1,928,135 8.4 Amount of Delinquencies I I I I I I not yet Collected I 58,095,464 I 64.3 I 36,934,081 I 54.9 I 21,161,383 I 91.6 lCompiled from State Comptroller's Annual Reports. per cent of all delinquency was collected during the period, 45.1 per cent of the “solvent” class, and 8.4 per cent of the “insolvent” class. Thus it is seen that we have not collected one-half of the delinquent taxes supported by a lien on real estate, and a negligible part of delinquent taxes on personal property only. This suggests the need for a more vig- orous and strict enforcement of tax laws. In the case of personal prop- erty there is need for a more direct and certain method of collection. For example, why not collect the property tax on automobiles at the time the license is issued? Tax Delinquency of Farm Real Estate In the foregoing discussion an effort has been made to review briefly the general tax delinquent situation for the State. Attention has been called to the enormous amount of tax delinquency which has accrued in the State 10 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION and minor subdivisions on all property for all purposes since 1885., The fact that this delinquency has doubled since 1931 has been stressed and the significance of “solvents” and “insolvents” relative to tax delinquency has been emphasized. From this point the discussion will deal more par- ticularly with tax delinquency of farm real estate in 120 selected counties in the State for the period 1928 to 1932, inclusive. Table 3 gives a general summary of farm tax delinquency in 120 selected counties for the five-year period 1928 to 1932. From the figures in this Table 3. Number of farms delinquent, -annual acreage and amount delinquent, payments of delinquent taxes, and number and acreage of farm properties sold for taxes, in 120 selected counties in Texas, 1928-32 Payments on Acreage Annual accumulated Acreage of Number of delinquent aYfwunt delinquent Number of farm land Year farms (in delmfluent taxes sales of sold for delinquent thousand (m (in property taxes acres) thmlsand thousand for taxes (acres) dollars) 1 Dollars) 1928' 33,267 l 4,588 l 1,154 _ l 419 l 180 l 10,091 1929 l 41,015 l 9,306 l 1,535 l 544 l 193 l 22.872 1930 l 70,688 13,992 l 3,441 1,218 338 l 22,187 1931 l 95,076 22,196 l 5,106 1,519 176 l 11,666 1932 l 124,192 l 32.603 II 7,342 l 1,475 II 45 I 4,609 Total l 364,238? l 82,685 l 18,578 l 5,175 l 932 l 71,425 lTaxes delinquent which were levied in given year; e. g., $1,154,000 represents the amount ‘of 1928 taxes which became delinquent. '2Does not represent the number of separate farms; some farms were delinquent the full period and in the total are counted as five cases of delinquency. table it will be seen that the number of farms permitted to become delin- quent annually increased from 33,267 in 1928 to 124,192 in 1932. The acreage delinquent increased from 4,588,000 in 1928 to 32,603,000 in 1932. The amount delinquent increased from $1,154,000 in 1928 to $7,342,000 in 1932. Payments of delinquent taxes increased from $419,000 in 1928 to $1,475,000 in 1932. Relative to the amount delinquent each year there was ‘a decided decline in the amount paid. a "Farm Tax‘ Sales During the Period Studied It will be observed from Table 3 that only, 932, farm tax sales “were recordedfor the five-year period in the 120 counties studied. Many of these are accounted for because of some special situation. l Inone case an irrigation project was developed, grazing lands werecut up into small tracts and sold, in many cases to non-resident owners. In a relatively short time it was-found that the land was salting and becoming unproduc- tive. The project failed, soon the taxes on the land became delinquent, and recentlylmuchl of it has beensold. for taxes. Another instanceis- that of a tract of ‘grazing land that was cut into 10-acre tracts and soldtoibuyers scattered "widely over the United States with the view of settling a colony‘. TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS 11 The land was sold and the colony was never developed, but in-the course of a few years the greater number of the tracts were tax delinquent. As the story came to me, the county employed an attorney to sell these tracts for taxes. In both instances the majority of owners were non-resident and the tax sales are explained by a special situation. Both the State and County have been very lenient in administering tax laws relative to tax delinquency. In fact, the State has taken no steps toward enforcing tax laws, and the counties have been extremely lax. In the past it has been a common practice to file suit in the case of delinquency, but not to prose- cute the sale. The idea seems to be that eventually much of the “delinquency will be paid and fees will be collected on the suits filed Without the expense‘ of carrying the case through the courts. The exacting attitude of the court undoubtedly has discouraged tax’ sales in that a"failu"re to comply with the technical requirements of the law, or an errormade the procedure from the beginning of the assessment through to the close of the sale will invalidate the tax title. Thus with a lax and lenient en- forcement of assessment and collection lawsfand with an exacting, technical interpretation of these laws by the courts, the relatively felvli sales are not to be Wondered at. a Percentageof Farm Acreage Delinquent Table 4 shows the percentage of farm acreage by counties in ‘120 selected counties of the State becoming delinquent annually during the five-year period 1928 to 1932. An examination of this table reveals Table 4._ Percentage of farm acreage in each of 120 selected countiespf Texas ‘allowed to become delinquent annually, 1928 to 1932 ; ~ ' Percentage delinquent acreage is of ‘assessed’ acreage 1932 l 1931 I 1930 I 1929 I 1928 Anderson 43 24 21 15 tascosa 50 19 14 A 21 Bay 25 34 Bell ' 41 32 29 39 County ;>4.mo-*c»5.p.o:wu>wco| waawoowoomoomus icqwflemoqwe-me-Hwaoocol Cir-Ambit»: ~,',>~h1 ,. 12 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION Table 4. Percentage of farm acreage in each of 120 selected counties of Texas allowed to become delinquent annually, 1928 to 1932—Continued Percentage delinquent acreage is of assessed acreage 1932 1931 1930 1929 1928 25 5 25 22 28 wson I 34 County U! i-l Denton 11 De - 23 26 29 25 21 31 7 ayette 16 Fisher 35 oard 44 ort 20 24 G 6 10 17 13 45 50 35 37 31 18 36 35 18 41 39 24 38 |_4 2 0 8 4 6 4 5 9 6 2 6 1 4 2 5 3 1 18 2 1 2, __ __._ vis . 12 5 3 Jones 9 7 ufman 4O l6 l3 29 6 7 Lavaca 19 5 4 Leon I 86 79 35 I 16 I 13 Liberty I 29 17 14 I 13 | -14 Limestone I 39 29 19 I 7 I 6 Llano I 21 8 2 I ~— I —— Lubbock I 34 I 20 I 1O I 8 I 3 Lynn I 43 I 37 I 16 I 9 I 3 McLennan I 37 I 30 I 19 I 6 I 7 Madison I 4S I 42 I 26 I 9 I 5 Mason l 1s I 15 I s I 2 I — Medina I 26 I 17 I 10 I 5 I 2 Menard I 33 I 36 I 7 I 1 I TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS 13 Table 4. Percentage of farm acreage in each of 120 selected counties of Texas allowed to become delinquent annually, 1928 to l932—-Continued Percentage delinquent acreage is of assessed acreage County 1932 I 1931 I 1930 I 1929 I 1928 Montague I 36 25 I 25 I 12 I 9 Nolan I 37 73 I 32 I 4 I 3 Nueces I 51 38 I 14 I 9 I 3 Ochiltree I 42 2O I 4 I — I — Palo Pinto I 22 19 I 14 I 5 I 3 Parker I 33 29 I 22 I 11 I 11 Pecos ‘I 43 28 I 10 I 4 I 5 Polk 40 37 33 I 14 I 11 Potter 8 5 3 I 1 I —— Presidio 36 41 ' 12 I 4 I 4 Randall 50 3O 27 I 15 I 16 Reagan 13 9 4 I 4 I 5 Robertson‘ 49 40 36 I 21 I 15 Rockwall 55 35 23 I 11 I 2 San Patricio 48 29 15 I 7 I 4 San Saba I 4s I as I 32 I 6 I 4 Schleicher I 23 I 21 I 14 I 1 I 1 Scurry I 39 I 41 I 26 I 6 1 Shackelford I 18 I 16 I 17 I 3 1 Sherman I 46 I 26 I 14 I 3 1 Smith I 42 a0 I 20 I 24 I 11 Sterling I 8 2 I 4 I —~ I *- Stonewall I 61 58 I 24 I 10 I 4 Sutton ' I 27 23 I 15 I —— I - Swisher I 52 22 I 11 I 2 I , 1 Tarrant 37 28 18 I 10 I 11 Taylor 40 45 as I s I 5 Terry 4s 36 1s I 5 I 9 Titus I 57 52 I 54 I 25 I 24 Tom Green I 19 I 13 I 12 I 2 I 1 Travis I 39 I 29 I 19 I 14 I 12 Uvalde I 44 I 36 I 23 I 4 I 2 Van Zandt I 31 I 27 I 22 I 11 I 11 Walker I 42 I 28 I 24 I 11 I 9 Waller I 37 I 31 I 26 I 17 I 15 Washington I 27 I 18 I 10 I 5 I 3 Wharton I 17 I ' 11 I 4 I 4 I 4 Wichita I 39 I 29 I 21 I 11 I 10 Wilbarger I 55 I 20 I 13 I 3 I 2 Williamson I 32 I 20 I 9 I 2 I 1 Wise I as I ss_ I 2s I s I 8 Wood I 4S I 40 I 33 I 21 I 17 Jim Wells I 6]. I 56 I 11 I 3 I 9 I Average I 41 I 2s I 1s I 12 I 6 wide variations in the percentage of acreage becoming delinquent from county to county, and wide differences from year to year in the same county. With two exceptions the acreage becoming delinquent in 1932 was considerably higher than that in 1928. For the State the percent- ages were 41, 28, 18, 12, and 6 respectively for the years 1932, 1931, 1930, 1929, and 1928. 14 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION Tax Delinquency as Related to Type-of-Farming ‘Areas In studying the situation of tax delinquency 0n farm real estate in Texas, it should be helpful to analyze the data on an area or regional basis. TIT QT’) ]%%////////4 -....’//% / _ 1 ,__ 4V 4/4 ‘ al/lfiy/ \ .... u 7%” % u"? “jinn: 1/ n M . /, ,, ___. /,_,/’ 1 J _ . . , ,, f’ xf/f lhrljflftt; ¢¢¢¢ u W’ 7 r Z, <1 .1”...- ’II’;/H'II;I////I////I;/’ 1 7 /'// ‘in.’ 4 i ..... , I. 1/1,, -.l , i" ,1 :1 I I’ l" '/ , 1A .4, , '11 ' ,/v/,, a‘ "“"' / ) _,, naIO-O / . . ///’ /////////// , ,////» »/// I, ~~~~~~~ . //.n / ,,i/,,/// ,, p '///// l: ./ 1. a \l)~\l~l ‘_.....»l....u- . "' a ”/ L---|-7- ' _/ - ' I L l or 1“.- (QIOIIOQ F, Fig. 2. The heavy lines outline the several different type-of-farming areas of the State. The shaded counties are those included in the survey. The names of the areas with corresponding numbersare as follows: Panhandle Wheat and Canadian River Grazing Areas (1) (2), High Plains Cotton Area (3), Low Rolling Plains (4 High Plains Grazing Area (5A) & (5B), Edwards Plateau Grazing Area (7B , Rio Grande Plain (8), Corpus Christi Cotton Area (10), Upper Red River Valley (11), North-Central Grazing Area (12), West Cross Timber Farming Area (13), Grand Prairie (14A) & (14B), Black Prairie (15), Piney Woods Farming and Lumbering Areas (16) & (20), Post Oak Strip (17), Upper Coast Prairie (18), Coast Prairie (19). _ g )9 ) In Bulletin No, 427 of the Texas Agricultural Experiment Station the State has been divided into type-of-farming areas. These divisions are. based largely on similarities of soil,‘ climate,-topography, and the type of farming followed. Farm tax delinquency data have been summarized according to these areas or-a combination of the-areas.- Figure» 2 shows the location and extent of type-of-farming areas. ‘ d, 1» ,- - Table 5 shows, for the". five-year _period=1928* to 1932, the total farm acreage assessed, the total acreage delinquent, and the percentage of the ‘W1 1'5» ¢“""§“‘ ‘ its Oak Strip (m). “for all areas was 19.3 per cent. TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS 15 assessed acreage delinquent, by type-of-farming areas. The lowest per- centage of delinquent acreage was 12.5 in the Edwards Plateau Graz- ing Area (7A), and the‘ highest for the period was 34.1 per cent in the Table 5. Total farm acreage assessed for taxes and delinquent, by type-of-farming areas, 1928-1932, inclusive Total acreage Total acreage l Percentage 1 assessedg delinquent assessed Name and number of area (in thousand (in thousand acreage acres) acres) delinquent . . l l Panhandle Wheat and Canadian River I I Grazing Areas——l-2 32,861 I 6,110 I 18.6 ' I High Plains Cotton Area—3 20,340 I 4,294 21.1 Low_ Rolling Plains—4 28,369 7,004 24.7 I High Plains Grazing Area—-5A and B I 31,321 I 5,126 I 16.4 . I I I - Edwards Plateau Grazing Area——7A I 59,247 I 7,397 I 12.5 I I I Edwards Plateau Grazing Area~—7B I 22,487 I 2,951 I 13.1 I I Rio Grande Plain-8 24,958 I 5,233 I 21.0 I I Corpus Christi Cotton Area—10 4,732 I 1,117 I 23.6 Upper Red River Valley——11 I North-Central Grazing Area—12 I West Cross Timber Farming Area-—13 31,930 6,010 I 18.8 I Grand Prairie——14A and B 14,587 2,651 | 18.1 I Black Prairie~15 40,605 7,605 I 18.7 Piney Woods Farming and Lumbering ' I Areas—16 and 20 36,558 11,589 I 31.7 I Post Oak Strip—17 14,233 4,839 I 34.1 I Upper Coast Prairie—18 26,314 I _ 3,620 I 13.7 I Coast Prairie—19 10,351 1,512 I 14.6 __ I Totals 398,893 77,058 I 19.3 lFor location of the areas see Figure 2. EAcreage assessed from Annual Reports of the Comptroller of Public Accounts of Texas. The average acreage delinquency for the period Table 6 shows the amount of general tax delinquency, State and County, ias accumulated from year to year beginning 1928 and ending with 1932, ‘by type-of-farming areas. ;centage of the outstanding cumulated‘ delinquency. It also shows the payments and their per- It is to be noted that a marked increase in cumulated delinquency characterizes all areas. The lamount paid on the cumulated delinquency from year to year increased ' absolutely but in many cases declined relatively. The effect of low prices and poor crops undoubtedly explains much of the relatively low payments in the wheat area ofthe Panhandle. Low prices, particularly of cotton, evidently explains the relatively low payments for the year 1931. 16 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION m2 221N262 §Q$qw2 W: @m@.2@.2__§§.¢§.¢2 S: W222 @m@...$.m_ m2 @232 Ewafiww 2N __2w.2~ ¢$5¢¢i :38. m2 2R2 2.2.2». Q2 :52 2.2.2.... N2 T213 25.22 v.2 2N2 @322 Q2 “$2.2 22E 2 2.2.. 2.2.42 __2m.w£ W2 x512 212a w: __2¢....~ $3.2 W3 £22m x2422 N2 $22.2. 2N2 2 12 72:}; 2&3 __ WE v5.5» T22... __ Q2 wafiww 2552“ Q5 “$2.4m 222.2 2N $2.2 222$ 2 1 2M5... Nwwwoqw 2 $132 2.2.23 3 $2.3 @232 Q2 2.2.2 @242. .1: 2.2.2 2.2.3.2 3 a 2 N2 >252. @3522 3N $2.2m ..:.@.2b.2 Q2 23.2 2.2.8» Q2 23.2 wmmiz 2.2 $2.2. 28.2w 2 Q2 w3§2 Wmqmmw 2.2 .224... 52.2.53. w: $2.2 __w$.2~ Q2 $2.2m 22.3: =2 2.2.2 32:: v m a <2 W2 @5232 “$222.; 2M2 22.2: 52.2.3 w: 21$ 2.3.2 m2 23.» 2.252 Q2 3&2 :22 2-2-2 2.5 @822 52:2... _ i. 25$ 2x32 m; g2. 22x2 Q2 5N2 n22 m... __$ @222 2 3: $32 N255 Q2 2.2m Nmqtm M2 22.2 __o¢¢.3m m EN 32%....“ 32.22 __ W2 __2m.§ 55.3 __ w m2 mint. @222 v.2" 23; 2.3.2.2 Ea 2Y2 “H.252 Q2 2Q... $5.? w? 5%.“. 28.2 E 13 23.2 $223.. N2 M35 22.22 Q3. ww12T¢¢.$ Q2 12$ 2.22.2 Q2 2&5 22.2. 5. v2 n22 2.22 Q2 v2.2 23w .5 $3 522.2. Q2 <2.” 23a i: 2w 2.3 m a 2.. v.2 @232 22.25; m3 mmqiw @222. Q2 22.5 $52 S: $6.2 >212: 15 23.2 $3.» 2. m2 2.2.5 “$64.2 2.2 22.3 @232 .3 232 222 N2 29.2 22.5 m3 22.2 23a M. w...“ __2~.22 Wfinfiqm __ m...“ Ema“. in?“ __ Z __€a.$ flwmqfiwm __ M3 flwfia __§w.~.2 __ v5 3w.» W23 w m e 2 3.... w. 25 22.. m. 2...... .22.. w. .2? “.32.. m. “w... .212... m. 3 .5 44am 1. P 41am 1 P 11am 1. w. 1w...“ 1 P Wwwam .4 22 22 52. .52 1| -I|»| My! - main: Java: Mimciuw-uaénha h: 6:5 @323 fi-oflufiflow wwvsi-Esooa we .._::cEa EEG wouuum pa?» u: 1:0 ca wuz J hudfluaoh EQHH aiondifiofi @323 15:00 é 054,-. TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS 17 Problem of “Unknown” Properties in Tax Delinquency on Farm ' Real Estate Ninety counties out of 119 carried “unknown” lists of delinquent farm properties. Of the 72,841,242 acres that became delinquent during the period, 7,037,333 acres, or 10 per cent, was assessed as “unknown”. “Unknown” assessments result largely from either a lack of an adequate inventory, or from no inventory at all of real property. In a great many counties the practice is common for the assessor to summarize the acres rendered in a given survey, and, if the total is short of the acreage originally granted to the county, to assess the unrendered acreage on the “unknown” roll. If a taxpayer appears at the collector’s office and desires to pay the taxes on a given acreage in a certain survey for which there is no specific assessment he is permitted to do so and the “unknown” acreage is credited by the amount of his payment. Another source of discrepancy results in the case of Spanish grants which have subsequently been partially covered by junior grants and the total guaranteed acreage of all grants is carried on the assessor’s rolls. Apparently no adjustment has ever been made by the assessor’s office for some of these junior grants. The recent survey revealed cases in which such acreages as 8,500, 5,700, and 4,400 were assessed as unknown in certain surveys and entered on the delinquent rolls. A number of counties have been able to eliminate entirely or to reduce materially the “unknown” list by what is commonly referred to as a map and plat system. This is a system by which each separate tract is located and mapped by survey and identified as to abstract number and owner. Such a system is very useful provided it is kept up to date. A few counties after having gone to the expense of installing this system have employed someone to record current transactions. E1 Paso County seemed to be doing a good job at the time the survey was made. With- out further discussion of the general aspects of the “unknown”, sta- tistics are presented which should help one to visualize more objectively its extent and scope. Table 7 summarizes by counties, for the period 1928 to 1932, “unknown” delinquency relative both to the total number of farms becoming delinquent during the period, and to the total acreage involved. Of the 119 counties included in Table 7, ninety had “unknown” delinquent acreages ranging from one to forty per cent of the total delinquent acreage. Twenty-nine counties had no records of “unknown” delinquencies according to the survey. In sixty counties the number of “unknown” delinquent properties ranged from a small fraction of one per cent to twenty per cent; in eighteen counties the range was from twenty to forty per cent, and in twelve counties the number of delinquent proper- ties was forty per cent and over. This situation has real significance in the fact that of the total amount of “unknown” delinquent taxes dur- ing the five-year period only 13.2 per cent was collected, while 29 per cent of the total known tax delinquency was paid. Of 175,276 farm prop- erties that became delinquent during the five-year period, 19,281, or 11 18 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION Table 7. Summary, by counties, for the period 1928 to 1932, of “unknown” delinquency relative to number of farms and acreage involved Number of farms becoming _ Acreage becoming delinquent delinquent County Total I Unknown Percentage Total I Unknown Percentage of total -of total Anderson I 4,178 I 1,309 I 31 I 1,008,190 I 237,351 I 24 Atascosa I 2,119 I 653 I 31 I 1,162,499 I 394,534 I 34 Austin I 995 I 26 I 3 197,331 I 1,554 I 1 Baylor I 671 I 125 I 19 469,595 I 25,576 I 5 Bee I 1,642 I 2 I — 545,112 I 30 I ~— Bell I 2,556 I 445 I 17 I 884,725 I 214,003 I 24 Bexar I 2,206 I 77 I 3 I 632,915 I 29,009 I 5 Blanco 394 I 39 I 10 I 377,799 I 6,386 I 2 Bosque I 1,085 I 35’ I 3 I 647,079 I 14,966 I 2 Brazos I 1,192 I —-— I — I 460,384 I — I — Burleson I 2,334 I -- I — I 505,919 I -- I Burnet I 640 I — I —— I 515,114 I -— I — Carson I 216 I —— I -—— I 211,506 I ~ I — 038m) I 1,435 I 369 I 26 I 717,410 I 162,367 I 23 Cherokee I 4,074 I 403 I 10 I 993,112 I 126,735 I 13 Uhildress I . 730 I 60 I 3 I 636,393 I 10,417 I 2 Clay I - 1,195 I 108 I 9 I 444,336 I 10,935 I 2 0611111 I 2,999 I -_ I ~ I 367,737 I ~ I ~ (Jollingsworth I 1,335 I —- I — I 648,649 I »— I —— Colorado I 1,108 I —~ I —~ I 290,061 I ~ I ~ Coma] I 208 — — I 90,904 I —— I -— Coryell I 1,336 294 21 I 505,431 I 43,665 I 10 Urocxett I 128 70 55 I 599,227 I 92,935 I 16 Crosby I 708 I -— I -— I 478,359 I — I »— Dallam I 909 I 153 I 17 I 754,280 I 89,982 I 12 Dallas I 5,289 I ~—— I —— I 565,005 I —— I - Dawson I 1,377 557 I 30 I 560,299 I 223,700 I 40 Deaf Smith I 1,097 10 I 1 I 1,206,953 I 2,353 I e Denton I 2,164 307 I 14 I 543,840 I 72,785 I 13‘ Dewitt I 1,183 ——— I —— I 417,734 I —— I - -—- Dickens I 1,034 276 I 25 I 645,563 I 33,205 I 14 Dimmit I 3,274 1,500 I 46 I 1,205,670 I 115,261 I 10 Duval I 2,232 17 I 1 I 1,013,904 I 6,106 I 1 Edwards I 1,244 50 I 4 924,883 I 22,931 I 2 Ellis I 4,553 166 I 4 645,157 I 42,819 I 7 Falls I 1,607 -— I ~— 132,606 I — I '—— Fayette I 1,287 ~—- I —— I 347,309 I —— I — Fisher I 1,250 1.04 I 3 I 695,526 I 21,515 I - 3 Foard I 532 130 I 22 I 610,473 I 96,447 I 16 106m Bend I 1,259 144 I 11 I 490,466 I 41,073 I 3 Frio ' I 1,403 71 I 5 I 604,703 I 26,712 _I 4 Gillespie I 269 7 I 3 I 128,063 I 1,065_I 1 Goliad I 457 I — I — I 267,331 I - I — Gonzales I 1,231 164 I 13 I 452,300 I 75,211 I 17 ‘ Gregg I 1,109 - I - I 174,110 I — I ~ Grimes I 2,242 261 I 12 I 930,481 I 136,105 I 15 Hale I 1,435 I 5 I — I 891,199 I 669 I — Hamilton I 1,048 I 1 I -— I 480,679 I 30 I »— Hardeman 1,141 I 57 5 I 583,428 I 15,725 I 3 Harrison 3,173 360 11 I 655,887 I 64,103 I 10 . Haskell 802 I 43 5 I 413,846 I 8,972 I 2 TAX IDELINQUENCY ON FARM REAL ESTATE IN TEXAS 19 Table 7. Summary, by counties, for the period 1928 to 1932, of “unknown" delinquency relative to number of farms and acreage involved—Continued I . Number of farms becoming Acreage becoming I delinquent delinquent County I Total I Unknown pg§cig€zlge Total I Unknown pg;c§cg€glge Hays I 838 6 1 519,658 I 5,441 I 1 Henderson I 3,140 735 23 I 1,009,856 I 351,272 I 35 Hill I 2,888 445 15 I -388,623 I 127,256 I 33 Hockley _ I 1,465 I 314' I 21 I 803,807 I $537,776 I 30 Hood I 886 I 154 I 17 I 377,617 I 44,577 I 12 Hopkins I 1,915 I 215 I 11 I 374,580 I 25,782 I 7 Houston I 3,013 I 603 I 20 I 1,081,805 I 219,766 I 20 Hunt I 3,242 I — I —- I 346,716 I ~— I — Irion I 161 I -—— I —-— I 60,156 I — I - Jeff Davis I 181 I - I — 760,422 I ~ I — Jones I 2,024 I 470 I 23 802,217 I 158,750 I 20 Kaufman I 2,390 I 7 I — 817,804 I 1,157 I — Lamb 2,053 — —— 620,148 I ~— I —- Lavaca 1,303 55 4 I 381,213 I 27,357 I 7 Leon 2,290 584 26 I 1,618,544 I 395,963 I 24 Liberty 1,196 —— I ——- I 736,776 I - I — Limestone I 1,834 I 242 I 13 I 604,850 I 129,844 I 21 Llano I 231 I 35 I 15 I 213,608 I 9,651 I 5 Lubbock I 1,711 I 706 I 41 I 456,255 I 125,075 I 27 Lynn I 1,274 I 103 I 8 I 600,114 I 38,881 I 6 McLennan I 2,126 I 10 I — I 630,573 I 6,773 I 1 Madison I 1,104 I 85 I 8 I 394,501 I 24,036 I 6 Mason I 319 I 28 I 9 I 228,060 I 3,022 I 1 Medina 785 I 13 I 2 I 491,694 I 3,673 I 1 Menard 204 I -— I —- I 423,766 I —~ I ——- Montague 2,178 I 46 I 2 I 609,340 I 6,746 I 1 Nolan 743 I 19 I 3 I 851,564 I 3,061 I — Nueces 1,893 I 14 I 1 I 587,017 I 681 I »— Ochiltree 394 I ~— I —— I 392,529 I —— I - Palo Pinto I 1,201 I 434 I 36 383,470 I 49,682 I 13 Parker I 2,340 I 1,236 I 53 634,056 I 229,973 I 36 Pecos I 1,032 I 54 I 5 2,535,885 I 22,400 I 1 Polk I 2,040 I 403 I 20 I 1,048,273 I 232,600 I 22 Potter I 222 1 —- I 98,400 I ~— I —~ Presidio I 442 78 18 I 2,387,343 I 741,245 I 31 Randall I 699 —- ~ I 795,897 I —~ I — Reagan I 132 30 23 I 156,053 I 12,750 I 8 Robertson I 2,002 129 I 6 I 919,741 I 91,192 I 10 Rockwall I 902 49 I 5 I 119,195 I 4,666 I 4 San Patricio I 1,732 33 2 I 458,038 I 8,978 I 2 San Saba I 988 1 — I 877,284 I 11,160 I 1 Schleicher I 144 3 2 457,638 I 1,344 I -— Scurry ' I 1,069 I 77 I 7 645,712 I 19,202 I 3 Shackleford I 423 I —— I ~ 317,476 I ~— I — Sherman 480 —— I —-— 532,464 I — I — Smith 4,129 447 11 765,232 I 69,960 I 9 "Sterling 133 -— —— 76,654 I —— I — Stonewall I 844 I 208 25 908,661 I 116,517 I 13 Sutton I 100 I 1 1 611,250 I 392 I — Swisher I 635 I 19 3 508,905 I 11,544 I 2 Tarrant I 4,263 I 207 5 I 546,849 I 15,066 I 3 20 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION Table 7. Summary, by counties, for the period 1928 to 1932, of “unknown” delinquency relative to number of farms and acreage involved—Continued Number of farms becoming Acreage becoming delinquent delinquent County Total Unknown Percerltage Total Unknown Percelltage 0f tOtBI of total Taylor I 1,497 I 25 I 2 I 760,861 2,733 I — Terry I 924 I 85 I 9 I 639,847 28,412 I 4 Titus I 1,706 247 I 14 I 578,961 52,968 I 9 Tom Green I 777 I 176 I 23 I 455,466 I 38,566 I 8 Travis I 1,749 I 322 I 1s I 716,391 I 186,946 I 26 Uvalde I 681 I 46 I 7 I 1,096,188 I 17,775 I 2 Van Zandt I 2,606 I 657 I I 24 I 642,353 I 147,468 I 23 Walker I 1,764 I 301 I 17 I 647,666 I 120,919 I 19 Waller I 1,370 I 156 I 11 I 417,059 I 98,813 I 24 Washington 1,036 I —— I ——— I 247,138 I —‘ I — Wharton 1,416 I —- I — I 283,774 I — I — Wichita 572 I 358 I 63 I 419,334 I 122,849 I 30 Wilbarger I 1,136 I 50 4 657,464 I 19,311 I 3 Williamson I 1,410 I 81 6 457,936 I 42,127 I 9 Wise I 2,087 I 151 7 656,855 I 40,146 I 6 Wood I 2,804 I -— I — I 698,487 I -—— I - Jim Wells I 1,473 I 24 I 2 I 763,631 I 5,807 I 1 Total 1| 175,276 19,281 iI 11 lI 72,841,242 I 7,037,333 I 10 per cent, were classified as “unknown”. Ten per cent of the total de- linquent acreage was “unknown”. It seems absurd for a county to go to the expense of assessing “unknown” property, and later spreading much of the assessment on the delinquent roll, when the chances of col- lecting are so meager. Some of the More Important Causes of Tax Delinquency No effort will be made to treat the causes of tax delinquency ex- haustively. Only the more apparent causes, and particularly those more specifically related to the situation in Texas will be discussed. The personal or human aspect is inherently a part of all social and eco- nomic problems. Taxes often become delinquent because of the indif- ference, procrastination, or misfortune of the taxpayer. An unfavorable economic situation with low prices and vanishing incomes such as we have experienced during the past four years render it difficult to pay taxes; consequently those who habitually live on, or near, the sub- sistence level will‘ become delinquent in their tax payments. From the legal point of view it is felt that the fault is not so much with the law, but with the failure to enforce it. Lax and lenient administration of the tax laws together with an exacting and technical interpretation of the legal requirements in case of tax titles has undobutedly encouraged tax delinquency. A deep and somewhat remote cause of tax delinquency is the failure of our tax system to include and properly harmonize the two TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS 21 fundamental bases of taxation-benefit and ability to pay. Let us ex- amine somewhat more in detail the more important of these causes. Declining agricultural prices and rising taxes have made it more and more difficult for farmers to pay taxes. This situation from year to Year during the past two decades is fairly clearly revealed in Table 8, which shows the relative trends of taxes and prices paid for farm products. On Table 8. Index numbers of farm real estate, farm nrices in Texas, and trend of farm taxes relative to farm prices Index numbers Ratio of tax index of Year farm real estate to in- Farm real estate Prices paid pro- dex of prices received taxes in Texas ducers farm for farm products . products in Texasl 1913 100 I 100 | 1.00 1914 99 I 95 I 1.04 1915 I 118 I 93 I 1.27 1916 I 115 120 I .96 1917 I 137 . 177 I .77 1918 I 145 220 I .66 1919 I 188 222 I .85 1920 I 193 217 I .89 1921 I 200 I 105 I 1.90 1922 I 219 I 132 I 1.66 - 1923 I 232 I 167 I 1.39 1924 I 243 I 166 I 1.46 1925 255 I 156 I 1.63 1926 258 I 126 I 2.05 192-7 276 129 I 2.14 1928 277 150 I 1.85 1929 292 145 I 2.01 1930 296 109 2.72 1931 310 70 4.43 1932 250 51 4.90 1933 233 64 3.64 lFarm Economics, Cornell University, New York the assumption that the level of farm prices approximates rather closely the farmer’s ability to pay taxes, a ratio of the tax index to the farm price index is calculated which indicates the trendyof farm taxes in terms of farm prices. An index of farm income would have been better suited for measuring this trend but such an index is not available. One will observe from the ratio that the trend has been decidedly upward. A wide variation in the real weight of the tax is at once apparent. For example, during this period, the tax was relatively lowest in 1918, and relatively highest in 1932. A tax bill that would have been paid by one bale of cotton in 1918 would have required about seven and one-half bales to have satisfied the obligation in 1932. Obviously, farmers that were barely able in 1918 to pay their taxes would find it impossible to pay their taxes in 1932. The situation also provides a convenient excuse for those who could pay but are prone to delay and procrastinate. Natural hazards such as drouth, flood, insect pests, etc. often cause temporary and local- ized farm tax delinquency. 22‘ BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION Faulty assessment, resulting specifically in disparity of assessment, over-assessment, and failure to assess, is one of the primary causes of delinquency. It was pointed out in Bulletin N0. 458 of the Texas Agri- cultural Experiment Station that the assessed value of farm lands varied widely, ranging from 10 to over 100 per cent of the sales value. Such a disparity leads to both under- and over-assessment. In the case of over-assessment coupled with a high tax rate, it is easy to see how the tax may equal or even exceed the current income. Delinquency is inevitable if such a situation persists for a period of years. Temporary over- assessment may result from declining prices, but such a condition will right itself with an improvement in prices. A failure of the tax system to adequately reach vast sources of wealth having tax-paying ability is another element of disparity in tax- ation and, indirectly, a cause for tax delinquency. Not many decades ago land made up most of our property, and Was a fairly good measure of ability to pay taxes. This is not the case today. Modern industrial development characterized by a high degree ‘of specilization, has brought with it a great expansion in the kinds of property, and in the develop- ment of personal-service activities. A century ago it would have been difficult for one to enjoy an income of any significance without the use of real property; Today a man may enjoy a substanital income, even a large income, without owning any real estate, nor even property of any kind. If he owns no real estate he will not be called upon to pay taxes to support his local institutions. In fact, he may pay nothing to support State institutions. In Bulletin No. 505 of Texas Agrcultural Experi- ment Station it is stated that intangible property constituted 46 per cent of probated estates in 47 selected, counties. Not more than one or two per cent of intangibles is placed on the tax rolls. This wholesale escape places an ever-increasing burden on real estate and undoubtedly is a real cause of delinquency. Faulty collecting practices no doubt may be blamed for a certain amount of tax delinquency, especially short-time or temporary delin- quency. It is rather uncommon for the tax collector to send out notices of taxes due on the opening date for payment and a statement for each month thereafter. If private business concerns were as negligent or unconcerned regarding bills due them as our county collector’s office they would show a very poor record of collection. The lack of certainty in the enforcement of the law, as well as the periodic liberalty of the legislature in remitting penalties and interest on delinquent taxes, is a constant invitation to delinquency. It is not the severity, but the certainty of penalty that is effective in tax collections. It is a grave injustice as well as demoralizing to those who willingly pay their taxes to periodically remove the penalty and interest on those who for various reasons permit their taxes to become delinquent. The delay, as well as the play of technicalities in court procedure, discourages certainty in the enforcement of tax laws. The procedure in tax sales and tax titles is so cumbersome and expensive as to discourage TAX DELINQUENCY ON FARM REAL ESTATE IN TEXAS 23 proper and prompt action. The loss of property in Texas through a tax sale is an uncommon occurrence. \ Suggestions for Improvement Thus far statistics have been presented showing the scope, nature, and trend of tax delinquency in general, and of tax delinquency of farm real estate in particular, for 120 selected counties in the State for the period 1928 to 1932 inclusive. Some of the more important causes of tax delinquency have been discussed. At this juncture it should be helpful to consider briefly a few suggestions as to steps that may be taken to improve or remedy the situation. 1. There is real need of an active and responsible participation by the State in the assessment and collection of taxes. Particularly is the assistance of the State needed in supervising and equalizing of assessments as between different forms of property and as between counties. The State could render invaluable aid, in the collection of taxes, particularly in the collection of delinquent taxes. This is contrary to the contention that there should be a separation of State and local sources for purposes of taxation. A close coordination and joint participation and responsibility should strengthen both State and local units of government. A State Tax Commission or a commission with sufficient authority and financial support, is perhaps, best suited for such an important undertaking. 2. There is urgent need in many counties for a complete and con- tinuous inventory of real estate including tax exempt real estate. Such an inventory should practically eliminate “unknown” assessments. In order to insure uniformity and continuity in such a service it should be a joint service of State and County. 3. The collection of taxes should be made as simple, certain, convenient, and regular as possible. In this connection the following procedure should prove effective: a. Statements of taxes due should be mailed just prior to opening due date and at regular intervals until paid. Special notice should be given calling attention to penalty date. b. Taxes of all jurisdictions should be combined in one bill and allocated by the tax collector's office. A multiplicity of assessments and collections adds to confusion, duplication, and inefficiency. c. Collectors should be appointed on a competitive basis determined by civil service examinations, and paid strictly on a salary basis. The value of such a change would be to remove the tax collector insofar as possible from political influences. d. Penalties should be reasonable and certain, and remission of penalties and interest should be avoided. 4. Court procedure relative to tax titles should be simplified. A tax sale should involve the actual transfer of the real estate encumbered, or a sufficient amount of it to satisfy the tax. The State should guarantee the title. 24 BULLETIN NO. 507, TEXAS AGRICULTURAL EXPERIMENT STATION 5. Finally, the full solution of the delinquent tax problem must go beyond the immediate administrative and legal aspects to certain funda- mental economic and political factors. This includes, according to a preliminary report of the committee of the National Tax Association on tax delinquency, “(1) such revision of the whole tax system as is necessary to harmonize benefit and ability as bases of taxation with each measure of ability given its proper weight; (2) a. reappraisal of the functions and services of government to determine whether they have expanded beyond the point of legitimate need and willing support; (3) changes in the organi- zation of political units, in the distribution of functions, and in the methods of administration calculated to insure the greatest efficiency; and (4) in addition to these fiscal and governmental adjustments, correction of such economic ills as grow out of unwise land utilization.“ lProceedings of Twenty-Fifth National Conference, 1932, pp. 292-329.