Generally, a tract of land and its improvements are appraised together and assigned a single value. Texas appraisal districts, however, are permitted to divide a tract and its improvements into separate components, each with its own tax account number, and appraise them individually.

The Texas Supreme Court held as a matter of law that appraisals of individual accounts may be challenged as unequal. The District argued that the “property” referred to in the statutory provisions authorizing appeal from property tax valuations is not the property in the separate tax accounts but rather the entire refinery. The Supreme Court rejected this argument, agreeing with Valero that nothing in the applicable statutory provisions requires a taxpayer to challenge all the appraisal accounts used to appraise its property. On the contrary, the Tax Code defines property as “any matter or thing capable of private ownership.” Each part of Valero’s refinery covered by a tax account was property within the meaning of the Tax Code. Accordingly, the District Court had jurisdiction of Valero’s appeal. The Court reasoned that because the District had the discretion to appraise Valero’s property by assigning it to various tax accounts, it could not argue that Valero’s challenge to the appraised value of some of those accounts was somehow deficient.