Untitled Texas Attorney General Opinion

The Attorney General of Texas JIM MATTOX August 13, 1984 Attorney General Supreme Court Building Honorable T. R. Ba"d:r Opinion No. JM-189 P. 0. BOX 12546 Nueces County Attonwy Aus!in, TX. 76711. 2546 Courthouse Re: Whether an area to be developed 5121475-2501 Corpus Christi, Texas 78401 for tourist purposes within its Telex 910/874-1367 Telecopier 5121475.0266 extraterritorial jurisdiction may be designated by a city as a" industrial district 714 Jackson, Suite 700 Dallas, TX. 75202-4506 Dear Mr. Bandy: 214/742-8944 You advise tha: certain areas along Mustang Island in Nueces 4624 Alberta Ave., Suite 160 County are being e:r:ensivelydeveloped for tourist-related purposes El Paso, TX. 79905.2793 (through the const,ruction of hotels, condominiums, vacation home 9151533.3464 subdivisions, and rw:reation facilities). You ask: PO1 Texas, Suite 700 May the governing body of a cj~tydesignate as a" Juston, TX. 77002-3111 industria:ldistrict under the Municipal Annexation 7131223-5686 Act certain areas within its extraterritorial jurisdict:lrm which it determines are primarily utilized :iorthe tourist industry? 606 Broadway, Suite 312 Lubbock, TX. 79401-3479 6061747-5236 The Municipal Iumexation Act, article 970a, V.T.C.S., was enacted in 1963. See Acts; 1963, 58th Leg., ch. 160, at 447. Section 5 thereof states in pertinent part: 4309 N. Tenth, Suite B McA,,en, TX. 76501~1665 512/662-4547 Sec. 5. The governing body of any city shall have the right, power, and authority to designate w par: of the area located in its 200 Main Plaza, Suite 400 extraterr:it:orialjurisdiction as a" industrial San Antonio, TX. 76205.2797 district, .XS the term is customarily used, and to 51212254191 treat witi such area from time to time as such governing body may deem to be in the best interest An Equal Opportunity/ of the city. Included in such rights and powers Affirmative Action Employer of the governing body of any city is the permissive right and power to enter into contracts or agreemwts with the owner or owners of land in such intcstrial district to guarantee the continuat:1on of the extraterritorial status of such distr:.ct,and its immunity from annexation by the city for a period of time not to exceed seven (7) years, and upon such other terms and p. 825 Honorable T. R. Bandy - Pagr,2 (JM-189) considerations iw the parties might deem appropriate . . . . (Emphasis added). The term "industrial distri':,:" is not defined by article 970a, but is to be understood "as the telxlis customarily used." In Calvert v. Austin Liulndryand Dry Cleaning Co., 365 S.W.Zd 232 (Tex. Civ. App. - Austin 19c3, writ ref'd n.r.e.), the meaning of the undefined term "industrial cperations," as used in a taxing statute, was at issue, Declaring th:.t the word "industrial" has a meaning of its own, and that the 1egis:l;lture is presumed to have used the word in the sense ordinarily underxood, the court held that the operations of laundrv and drv cleanine xlants were "industrial onerations." The court relied ;pon Nortlh 'Side Laundry Co. v. Board of Property Assessment, Appeals and RevTew, 79 A.2d 419 (Pa. 1951), which held a commercial laundry to be an'sdustrial plant" within the meaning of a Pennsylvania taxing statute. Cf. State ex rel. Keystone Laundry and Dry Cleaners, Inc. v. McDomxll~26 --* S.W.Zd 11 (MO. 1968). The Pennsylvania SuprenleCourt in the North Side Laundry case, responding to an argument tlat the Pennsylvania statute as construed in a prior case unco"stit,lrionallydiscriminated against a laundry because other "service induj:ries" were not equally taxed, explained: [T]he fact that tte businesses to which plaintiff referred are rometimes generically called 'industries' is Lrrelevant to the issue here raised. The question is whether their establish- ments are industrisl plants. The answer to that question is self-evident. By no stretch oE the imagination could a bank building, a hate:.,a theater or any of the other business establir;l,mentsreferred to by plaintiff be considered ar industrial plant. It is true that we sometimelrspeak of 'the movie industry', 'the hotel industry' or 'the banking industry', but that is merf,~lya loose use of language to convey that idea that the particular business is a sizeable one. Irispite of that colloquialism, we do not speak o!: the buildings housing such businesses as '::"dustrial plants'. Plaintiff attempts to gi~ve to that phrase a legal meaning that goes far beyond anything that was contemplated by the Courts when they pronounced this rule and by the legislature when it adopted it in the Act of 1933. The law can do no better than to define ar industrial plant as that type of establishment whj.(,h the ordinary man thinks of as p. 826 : . Honorable T. R. Bandy - Page 3 (JM-189) C such. Certainly a commercial laundry comes within that definition bdt the other businesses here mentioned do not. See also Union Mutual Life Irsurance Co. v. Emerson, 345 A.2d 504 (Me. 1975); State Police DepartmelG:v. Hargrave, 237 N.E.Zd 269 (Ind. App. 1968); Attorney General Opinlcn MW-552 (1982). Similarly, the question here is not whether businesses catering to tourists might be regardcclas engaged in "the tourist industry." The question is whether an srea primarily utilized for the tourist industry can be properly regarded as an "industrial district" within the meaning of the statute. We do not think the leE;jslatureintended to allow the extension of a city's powers, in the mrner contemplated by section 5 of article 970a. to embrace every extraxrritorial are+ occupied by a commercial venture that might be considt:.red part of some "industry" in the broad sense. As the Supreme Court: of Maine noted in Union Mutual Life Insurance Co., supra, where 'Lndustrial plant" status was claimed for the home office of an in3llrance company because it was highly capitalized, had a large labcr force, and other indicia: If the argument ai.xancedwere to be adopted, it would seem that an:!general office building could in theory qualify 5,san industrial plant. 345 S.W.Zd 507. The Maine Court relied upon and quoted from the Indiana case of State Police Department v. Hargrave, m, to the effect: [Tlhe ordinary man rrouldunderstand an industrial plant to be any factory. business or concern which is engaged primarily in the manufacture or assembly of good!; or the processing of raw materials, or both. We believe an "industrial district," as the term is customarily used, is an area where indujrrial plants are located, as contrasted with areas that are merely commercial in character. If the term "industrial" were synonymous with the term "commercial" in ordinary usage, it would be idle for osr statutes to refer to them separately. See V.T.C.S. art. 1349 (":mxnercial or industrial" clubs); art. 5190.6, §2(10) ("manufacturing and industrial facilities," and "commercial development," in addition); art. 5186 ("business and industrial development"). Cf. V.T.C.S. art. 5190.1, 52(j) ("manufacturing or industrial enterprise"); art. 5190.2, §2(=) ("manufacturing or industrial enterprise"). Article lOlla, V.T.C.S.. grants certain cities zonin;: power over land "for trade, industry, p. 827 Honorable T. R. Bandy - Page 4 (JM-189) residence, or other purpose." Distinctions between cormnercialzones or districts and manufacturing or industrial districts have been readily applied. City of Corpus Christ1 v. Jones, 144 S.W.Zd 388 (Tex. Civ. App. - San Antonio 1940, writ dism'd judgmt car.). -.See also City of Amarillo v. :;'&, 109 S.W.Zd 258 (Tex. Civ. App. - Amarillo 1937, writ dism'd). Cf. City of Amarillo v. Stapf. 101 S.W.Zd 229 (Tex. Comm'n App. 1937,pinion adopted). In only two cases that we have found is there a suggestion that section 5 of article 970a might reach farther. See Mihailov v. City of Cedar Hill, 453 S.W.Zd 111:(Tex. Civ. App. - Dallas 1970. no writ) (mobile home site development); and Fox Development Co. v. City of San Antonio, 459 S.W.2d 670 (Tex. Civ. App. - San Antonio 1970). affirmed, 468 S.W.2d 338 (Tex. 1971) (subdivision development). In the Mihailov case, supra, the court merelr held that the city could not be denied an opportunity to litigate the question of extraterritorial rights under sections 4 and 5 of article 970a. In the Fox Development Co. case, a, the Court o:i Civil Appeals said that because the appellant had not shown a co:.laterallyattacked ordinance to be void, the trial court did not err in holding that the land in dispute was "within the extraterritoria:.jurisdiction of the City of San Antonio under Article 970a, 55." But in affirming the result of the Fox Development Co. case, the fupreme Court held that section 7 (not section 5) of article 970a was the operative section. Three cases to which Houston Endowment, Inc. was a party concerned unimproved land, used for agricultural purposes, that was considered subject to inclusion in an industrial district. We do not believe that they represent a different view, however, because the land was acknowledged to ,e "far more valuable for industrial development than for any otter use." City of Pasadena v. Houston Endowment, Inc., 438 S.W.Zd -52, 155 (Tex. Civ. App. - Houston [14th Dist.] 1969, writ ref'd n.r.a.). [The land was within territory held by a city under articles llfi:#-1187,V.T.C.S., which authorize limited annexations for improving navigation along navigable streams and for establishing and maintainin,:wharves, docks, railway terminals, and other facilities for aidin]: navigation or wharves. Article 970a, V.T.C.S., does not apply to s,lchterritory, City of Houston v. Houston Endowment, Inc., 428 S.W.2d 706 (Tex. Civ. App. - Houston [lst Dist.1 1968, writ ref'd n.r.e.), but article 1187-l. V.T.C.S., allows the designation of industrial disrricts there in words almost~identical to those of article 970a. --Houston Endowment, Inc. v. City of Houston, 468 S.W.Zd 540 (Tex. Civ. Ap:?.- Houston [14th Dist.] 1971, writ ref'd n.r.e.). Cf. City of Nassau Bay v. City of Webster, 600 S.W.Zd 905 (Tex. Civ.App. - Houston [ist Dist.] 1980), writ ref'd n.r.e.. per curiam, 608 S.W.Zd 618 (Tex. ,.980).] We are of the opinion, c.fteran examination of the statutes and cases, that the governing bo+ of a city may not properly designate as p. 828 Honorable T. R. Bandy - Page 5 (JM-189) an industrial district unde:r the Municipal Annexation Act an area within its extraterritorial jurisdiction which it determines is to be primarily utiljzed for the tourist industry. SUMMARY .- The governing bclc.yof a city may not properly designate as an j.r.dustrialdistrict under the Municipal Annexation Act an area within its extraterritorial jurisdiction which it determines is to be primarily utilized for the tourist industry. JIM MATTOX Attorney General of Texas TOM GREEN First Assistant Attorney General DAVID R. RICHARDS Executive Assistant Attorney :?neral Prepared by Bruce Youngblood Assistant Attorney General APPROVED: OPINION COMMITTEE Rick Gilpin, Chairman David Brooks Colin Carl Susan Garrison Jim Moellinger Nancy Sutton Bruce Youngblood p. 829