Dr. J. W. Edgar Opinion No. (Ci379)
Commissioner of Education
Texas Education Agency Re: Whether The Classroom
Austin, Texas Teachers of Dallas, a
non-profit corporation,
is exempt from payment
of franchise taxes under
Dear Dr. Edgar: stated facts.
We quote In Its entirety your letter requesting the opinion
of this office on the above captioned question.
"The Classroom Teachers of Dallas is incorporated
as a non-profit membership organization under the laws
of Texas for the following purpose as stated in its
charter:
'The purpose for which The Classroom
Teachers of Dallas is formed is strictly
educational, to-wit: The advancement of
public school education in Texas.'
ItI am informed that the organization, in pursuit of
the stated purpose, engage8 in the following activities:
"1 . It publishes and distributes The Dallas Teacher,
a periodical including columns designed to provide
beneficial information and significant news to the
teaching profession.
“2 . It distributes to the teachers educational
pamphlets and materials printed by the National Education
Association and the Texas State Teachers Association.
"3. It organizes and assists in organizing Future
Teachers of America Clubs in each high school and junior
high school and participates extensively in the programs
which are designed to provide information to future
teachers.
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Dr. J.~W. Edgar, Page 2 Opinion No. (C- 379)
“4 . It helps organize
-. Student
. .Education
. . .Associ-
ations in colleges, supplies tnem witn eaucatlon
materials and works with them in their programs which
look toward teaching as a profession.
“5 . It supplies speakers at local, district and
state meetings of both Future Teachers of America and
Student Education Associations.
“6. It provides speakers, programs and pamphlets
encouraging all teachers to better qualify themselves
professionally through indtvidual study along with
recommending programs of indtvidual study.
“7. It cooperates in the programs of Texas State
Teachers Association (TSTA), Texas Classroom Teachers
Association (TCTA), National Education Association
REA) and Teacher Education and Professional Standards
tTEPS), which are designed to educate, inform and
improve teachers and the teaching profession.
“8. It sends representatives to meetings of Texas
State Teachers Association (TSTA), Texas Classroom
Teachers Association (TCTA), National Education Associ-
ation (NEA) and Teacher Education and Professional
Standards (TEPS).
"9. It sends representatives to the local Chamber
of Commerce meetings upon request to exchange information.
"10. It conducts an annual banquet for teachers and
the public fin general, which is designed to impart infor-
mation to the public and to provide closer cooperation
between teachers and the public. At this year's banquet,
the President of the National Education Association
spoke on "Education for World Responsibility".
"11. It encourages teachers to become members in
professional teacher organizations.
"12. It provides public information about the teach-
ing profession.
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Dr. J. W. Edgar, Page 3 Opinion No. (C-379)
"13. It polls members regarding their feeling as
to the current status of professional competence,
standards and ethics.
"14. It provides a forum for discussion of problems
involved in teaching.
1115. It reports on all current programs at each
meeting.
"16. It works toward a program whereby teachers
teach only in their fields of training or qualifications.
"17. It interprets teacher education and professional
standards to the teachers.
"18. It encourages compliance with the Professional
Code of Ethics.
"lg. It provides business and professional leaders
with information regarding the current status of education.
"20. It provides speakers at meetings in each school
on each part of the Professional Code of Ethics.
"21. It provides an atmosphere conducive to the
improvement of professional standards and mutual
cooperation in the working out of teaching problems.
"22. It works closely with local (Dallas) school
officialsand administrators in determining programs,
policies and discipline.
"23. It cooperates extensively with the Assistant
Superintendent of Schools in charge of In-Service
Training in devising beneficial in-service training
programs.for teachers.
"24. It cooperates with local administration in
the recruitment of prospective teachers.
"25. It cooperates with local administration in
the orientation of new teachers.
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Dr. J. W. Edgar, Page 4 Opinion No. (C- 379)
“26. It maintains a small scholarship fund, from
which it grants small scholarships to worthy, but
needy, students in and from the Dallas School System.
“27. It maintains a small benevolent fund, from
which it occasionally makes grants to any teacher in
the Dallas system who is in need.
“28. As a local
branch of each organization, it
receives dues for (and remits such collections to ) its
parent organizati,on,the Texas Classroom Teachers
Association; the Texas State Teachers Association; and
the National Education Association.
"The activities above listed are those in which the
organization customarily participates. It has on
occasion sponsored a social activity for members; and it
may on some occasions have paid expenses of some member
or officer to attend some meeting not listed above, for
discussion of matters of concern to the schools of Texas.
For your Information, there is attached hereto copy of
an audit of all receipts, and expenditures of the organ-
ization for the year 1961, which further illustrates its
activities.
"you are requested to advise whether a corporation which
is organized for the purpose above stated and engages in
the activities above enumerated is required to pay a
franchise tax under the laws of Texas, and particularly
Arts. 12.01 and 12.03 'Taxation-General', Vernon's Civil
Statutes as amended.
"In connection with this request, I would add that in
my opinion the activities enumerated above are designed
to further and do further the program of public education
in this State. So far as I can see, it has no other
purpose. If any individual or class of individuals
benefits from the activities of the organization, other
than as the general public benefits, it is in an indirect
way. That is, the encouragement of teachers to improve
themselves in their teaching abilities and citizenship
responsibilities, and assisting with local school programs
of in-service training may result ultimately in higher
salaries for the teachers who are improved by such programs.
But that is an incidental result (assuming it occurs) of
acitivities designed to give better teaching in the public
schools.
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Dr. J. W. Edgar, Page 5 Opinion No. (C- 379)
'At all events, the cooperative endeavors of
teacher-organizations such as The Classroom Teachers
of Dallas have been an integral, if not indispensible,
part of the progress made in furnishing better
training of our youth in the schools of Texas.
"In a sense, the question is whether such organ-
izations are to be charged for the,privilege of
making this important contribution to the public
good.
Article 12.03, Taxation-General, Vernon's Civil Statutes,
enumerates the allowable exemptions from franchise taxes. Among
those exempt are corporations organized for 'strictly educational
purposes. . . ."
In Attorney General Opinion No. WW-1517 (1962), this office
held that under the submitted facts a corporation chartered by an
association of teachers was required to pay franchise taxes. The
purpose clause of the charter of the corporation contained de-
tailed authorizations or stated purposes which in most respects,
would embrace the activities carried on by The Classroom Teachers
of Dallas. However, one of the charter purposes was ". . .to
improve the social and economic status of teachers; and to form
a representative body able to speak with authority for them."
We agree with the holding of Opinion No. WW-1517 that this part
of the purpose,,clauseis inconsistent with being a coqoration
organized for . . .strictly educational purposes. . . , and affirm
it for this reason.
We are not'in accord with that portion of the Opinion which con-
cludes that the following purposes are not "strictly educational":
(1) cooperation with the Texas State Teachers Association and the
National Education Association in the promotion within the teaching
group of the highest type of professional practices; (2) the en-
couragement of active participation of all teachers in the solution
of school problems (3) the encoura ement of members to be pro-
gressive students of education; (47 the arousing of allegiance to a
genuine code of professional ethics; (5) the encouragement of higher
qualifications for entrance into the teaching profession; (6) the
guidance of well endowed young people to select teaching as a life
work; (7) the promotion, encouragement and assistance of other local
teacher organizations; and (8) the promotion of cooperation among
such organizations and their members.
The charter of The Classxoom Teachers of Dallas states that It
is formed for a strictly educational purpose, to wit: "The advance-
ment of public school education in Texas." We agree with your ,vlew
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.I .
_-
Dr. J. W. Edgar, Page 6 Opinion No. (C-379)
that the activities in which the corporation engages are
consistent with its stated purpose and are designed for the
furtherance thereof. Any salary benefits which may accrue
to teachers as a result of the conduct of these activities
is purely incidental thereto and in no way affects or negates
the strictly educational purpose for which the corporation was
organized. You are, therefore, advised that under the sub-
mitted facts The Classroom Teachers of Dallas is exempt from
franchise taxes.
SUMMARY
-------
Under submitted facts, The Classroom Teachers
of Dallas, a non-profit corporation organized for
a strictly educational purpose and limited by its
charter to the advancement of public school education
in Texas, is exempt from payment of franchise taxes.
Yours very truly,
WAGGONER CARR
Attorney General of Texas
MMcGP:sjl
APPROVED:
OPINION COMMITTEE
W. V. Geppert, Chairman
Gordon C. Cass
Cecil C. Rotsch
Arthur Sandlin
W. 0. Shultz
APPROVED FOR THE ATTORNEY GENERAL
BY: Stanton Stone
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