The weakness of the tax system was not the failure to tax corporations or to reach personalty, but it was the escape of land both from assessment and from proper valuation. The difficulty that existed as to the taxation of land was due to the enormous extent of non-resident holdings. In 1852, for example, in twenty-four out of eighty-three counties reporting, the land outside the county rendered for assessment was greater than that within; and in only six of the twenty-four were the assessed values of the outside holdings larger than those for the lands within.2 It was permitted to render outside holdings in the county of residence, and this opened the way for non-rendition and undervaluation. Under the law of 1846 assessors were required to make a separate return to the comptroller of the renditions of outside holdings, accompanying the returns with a description of each piece of land rendered.'3 Each assessor was also required to make a return of all property in his county not rendered for assessment, accompanied by a description and valuation of each piece. The comptroller compared the returns to ascertain what lands were uncovered by other returns, and advised each assessor of the lands in his county which had not been rendered elsewhere. Because of labor and trouble involved in getting from the surveyors' files a description of the un-rendered lands, many assessors made no effort to assess them; and often when assessments were made they could not be used by the comptroller because the records or descriptions were imperfect.4 The chaotic situation was taken advantage of by landowners and evasion was rife. In 1849 the number of acres assessed was 32,890,887, while the amount of patented and deeded land in the state was 45,234,987 acres.1 In 1850 the law was changed so that the comptroller became possessed of both county and town maps and so became enabled to compare the returns with the maps of each county and as a result determine what lands had not been rendered. The amount of land assessed increased by more than five million acres in the year following this change in the law, while for the five preceding years it had remained practically stationary. The change in the law may have accounted for some of this increase, but the law imposed too huge a task upon the comptroller's department. Maps and other data were not kept up, and the most important evidence of the breakdown of the system is that there was little change in the number of acres assessed after 1855, though this was a period when land was being constantly patented.2

1 Vol. Mortality and Miscellaneous Statistics, p. 29.

2 Compiled from the Report of the Comptroller, 1852-3. Galveston County in 1852 reported 89,896 acres assessed within the county and 2,236.950 acres out of the county; Nacogdoches County reported 440,660 acres assessed within and 1,919,686 acres without the county.

3 Laws of 1846, p. 350.

4 Report of the Comptroller, 1847; House Journal, 2nd Leg., p. 44.

The conditions with respect to valuation was no better than those of rendition. Valuation was made where the property was rendered, but the machinery for revision of values existed in the county where the property was located. It was impossible for an assessor to know the relative value of land in the various and distant parts of the state and the inevitable result was Undervaluation.3 . The plan of a minimum value, per acre, such as existed under the republic, was suggested, but was not adopted.4

The situation as to evasion of taxation was aggravated by a loss of confidence in tax titles. The laws relating to the sale of property for taxes were minutely drawn and unless every detail were carried out by the officials in charge of the assessment and collection of the taxes and of the levy upon the property the courts would not sustain the title.1 The frequency with which they were not sustained contributed to neglect of rendition and of payment.2 The failure of land which was assessed outside the county of situs to pay its share of the taxes became a subject of increasing complaints and led a joint select committee of the house and senate which was appointed to examine the tax laws to pronounce the system of taxation a "farce" in its operation.3

1 Report of the Comptroller, 1848-9, p. 7.

2 Report of the Comptroller, 1856-7, p. 22; 1858-9, p. 16. Message of Governor Runnels, November 10, 1859; House Journal, 8th Leg., p. 42. Message of Governor Houston, January 13, 1860; House Journal, 8th Leg., p. 397. In 1856 out of over 68,000,000 acres of patented land, only 44,110,437 were assessed; House Journal, 7th Leg., p. 483.

3 Report of Joint Select Committee on Taxation; House Journal, 7th Leg., p. 483. See also references in preceding note.

4 Report of the Comptroller, 1856-7, p. 19.

An estimate of arrearages and of costs of assessment and collection of ad valorem taxes can be made by comparing assessments and receipts of several years. The taxes assessed one year were not as a rule paid into the treasury until the following fiscal year. The assessments of 1846 and 1847 amounting to $214,103 should have been paid by the end of the fiscal year 1848, but only $150,616 was received. Arrears and costs amounted to about 30%. The assessments of 1858 were $294,758 but the receipts of 1859, including back taxes, were $221,231, showing arrears and costs of over 25 per cent. In 1848-9 the estimated cost of assessment and collection was 13 1/2 per cent; delinquency amounted to from 12 1/2 per cent to I6 1/2 per cent.

Taxation as a source of revenue was not important during the greater part of this period. The state was sustained in the first year of its history by the revenue which had accrued under the laws of the republic, and after 1850 the indemnity bonds were used. From 1852 to 1858 nine-tenths of the state taxes were relinquished to the counties, and as the rate was only I2 1/2 cents in 1858, the bonds continued to be the chief dependence of the state government.

By the act of February 13, 1852, it was provided that inasmuch as many of the counties were in debt and were in need of courthouses, jails, jury funds and the like, nine-tenths of the state tax on the assessments of 1852 and 1853 should be relinquished to the counties where the tax was assessed, the remaining one-tenth to be paid into the state treasury for the benefit of the school fund.1 Again in 1854 and 1855 relinquishment was made to the counties where the taxes were assessed, but in 1856 and 1857 relinquishment was made for the benefit of the counties where the property was situated.2 The act of 1854 was vetoed because the governor thought that the counties in which the property was located should get the benefit, but the veto was nullified by a two-thirds vote of the legislature. The act of 1856 also was vetoed for the same reason, but was passed over the veto. This policy of relinquishment was unequal in its operation and was carried too far. The counties in which there were large assessments of property situated outside their boundaries profited unjustly at the expense of the counties in which the property was located.3 The counties which were favored were the richer counties, and those most discriminated against were the frontier counties.4 The policy was followed longer than was necessary to secure in the majority of the counties the purposes for which relinquishment was made. After 1855 a better policy would have been to have relinquished the taxes only to the frontier and the new counties.

1 Yenda v. Wheeler, 9 Tex., 408 (1853). Pitts v. Booth, 15 Tex., 453 (1855).

2 Report of the Comptroller, 1858-9, p. 17. In the report for 1848-9 the comptroller stated that probably one-third of non-resident assessments would not be paid and would have to be secured by a sale of property.

3 House Journal, 7th Leg., p. 483.