Untitled Texas Attorney General Opinion

OFFICE OF THE ATTORNEY GENERAL OF TEXAS AUSTIN * r----J’ \ i I srty real or permnal be- belonging 0%010eio*4 to Di8tzllots aa& Au- thorlties~ orerted or lnoorporatad under law8 emaoted gureuant to seotlon 59, Ae1010 xyx ~of the Oomtitution~ provldwd thut If any Hr. Rio L. Ladner, Page 2 meh Dl8trlot or AUthOrtty ha8 heretoion a@- qulred or does hereafter aoqulre property vhloh at tlm tZme of rooh aoqulsltlon la or was then rrnbjeot to taxation, and lm at the tltpe of it8 ao@.8ltlOn being ueod r0r gen- orating, trsnamlttiog, .and dlstrlbutlng eleo- tM.o energy or power, nuoh Dietriot or Au- thority rbmll at the flute8 pre8orlbed by lav for the payment of ad vaLoren taxen make a payment in llela of taxes to the stat. of Texan and to the ootmty, ,olty, and mob taxing dls- trlots vithln whlob muoh property 18 8ltUated; 8uohpaymerltlnlleUoftaxe8 tobe in the amount vhlah would be roelimed by&my-~ an ad vslorem tmx at the ourrent rates for then aurrent tax year baaed oa the a88e88ed valus of 8uah property for the last ourrent tax year before beiae aaqubed by~tiohDi8trlot or Authority; provided further that no pmy-~ ment shall be made vlth nrpeot to nay prop- ertp no longor ovned by 8ueh Dlmtrlat or Ati- thortty r0r generating, tranamlttlug, or dl.8.. trlbutlng eleotrio energy oe paver. Suoh pay- I mentti~lbu0ftaue88hbllbemadeoutof the revea~em reaeived by 8uah Dietrlot 0~ Au- thorlty from thagenerailon, tsanm=l88lon, or dlstrlbutlon of eleotrL0 paver and energy aad the liability Sor aama shall aonatltuts a llea Or OIV3WBb~OO OUIf In thO %WCUUiO8 Of 8UOh Dirtrlot or AuthorU~ snd 8hall be Oaxl8idered 88 a part of the operating 0xpen864* speolr- iaally, -.- no paymelltllehall be made in lleU or taa aa wtth nepeat to dmmm, dapl eltes, remor- volr axwa8, mnd water dlatributing or lrrlga- tion 8nteme. It ia the expresrred leglrlatlve lntent~ of thla Aot that suoh Dletrlots or Au- thorlt$O8 plake paykwnts fli llOt3 Of tsXe8 Only vlth respeot to propertier vhlah at the time oi their aaqt<lon vere on the ad valollaa tM X'OllS Of th@ St8t.O Of 'PeXm8 OZ' Of snf colilltp,city, or mny other taxins Distrlot of the State of Texas and vhbh at the time of Nr. Xl0 'Lr Ladner, Page 3 the aOqui8ltloP mre being U8ed iOr. @UAeFat- iryli:trummltting, or distrllnatlxq eleotrlo power ad energys pzwlded rudhor that it %S thO eXpl’O88Od lO&S~tf70 in-t tht W w-t8 w k &bb in l$OU Of -08 V&t& awpeet to dams, dam rlkr, re8er7olr areame gdwater dlstributlng or'lrrlgatlc8k sfstamw, .vw to any 8uoh Autho+y ~OtiDiEtriOt. -;uSO where aliy olty or town 80Qulre8 real and personal property 1oeat.d OtItSldO Of it8 OOZPOIV&O imt8 and OUtSid Of thb ~bounty ia wb.loh mtoh .Oity or toWL ir SitU- ated, exoept rural eleotrlfXaatlon llaes .mnedandoperatedbylt,andwhlchisor maybe used ln'the 8eneratlan, mauufaotur- selling or .dlstributiag of ~eleotrlolty, lag, ?: Stuh'O1~ol? tOWZ$Shldl8SkO~~tinXim ; ~0f:bi~OS QD EMUI t0 thw$t&O Of !~OX~S, the oeunty Oity, 'Bahool dlstrlots and muoh other io4ml taxing dl8trlots vithln whlah mo)r ~property A8 looated In. like asnner ai Mmiaebo*s.provided fO~~~8uOh D$&riOtS or that thb SUbrOotbn a~plloable to DUO8 PZ'OIHF~~ :&~Quired by a Oity or toWI%,Sltt&!StOd OXN a oounty l.me. hnd prmlded further, that my .olty 0~<9ovn, slaymake 8UOh .pmtS ,%a - of :tuer to the oounty Ia vh.toh .sald oZtp or, ~~018 lOcUrtOd, ~rO?kbd th. Oiw OC tOl?Jl ele~t8 to maim mush payment by ordlnume .0~~~~80lUtiOll p888Od by 'the gOVeming body ,Of.:D*LdCity Or tOU%’ (EZQbl&81lJAdded) -fouhsw lnqulred about the aonstltutionality of the -underliaed proviso ~to the seoond parafwaph 0r sub- dltZslom:Ik; purporting to oreapt olties and tow of a 8~Oif%d0&88 fM th0 'psJnsnt8 inlb3U Of taXUS" 01860 Whwe gene~y:impOeed by this Sub-diVisiOXl. 8iJaW th0 pre7lso~~ir ln the nature of an exemption, ve turn our at- LmtiOa to the Subject 0r the exemptlonL namely, the in- positian 0r a "payment in lieu of tares upon aities and Hr. Ala L. Ladnel;, Page 4 tfnfnsaoqulrlng property used In the gensratlan, mama- raoturing, melUng or distrlbutlng 0s eleotrlelt~, vhen- ever ruoh property la looatad in a oounty other than that 0s the olty or t0wn and vhenewr m0h property 18 subject t0 t8Xatioll 8t tbO t-0 Of it8 6OprriSitiaQ bJ the mxIiOlpality. It will k notlood ~that in omputln8 thy 8MUUt Of the80 "pynent0 in lieu Of ?i8~eS" the aUr- Wt ad YdON tu l'8tO k8 t0 b@ applied t0 th, 888e88Od tdur Of SUoh property iOr the l&St year pdOr t0 it8 W+ qui8ltlan W the oity or tovn, ~' ,' sO0tiQ.Zt1 Of APti mn Pi .the%X&S cOI¶Sti- tUtfon~&WOVidO8 in pa&: -oeOtlon 1..- Taxotlon shall ~b’ eq&l and . All propecty In this State, whether owd by natural persons or oorpmatlom; other thau munlolpal, s&all bw Wed in.pmportl~ its value, ~Mlch aball be +aaertaiaed as m b:provldedb$lav. TheLeglslature.. . *may lIIeo The 0.” . p r o p er ofty oountles,. 0ltles . and tow,; owned. arul.hold oaly for publio paw- pODUS, SU0h 88 ,pUbuO. bulldlnge SrUd thO Sit08 .: thererori Plre en&nom mad the lltrnlture ~there- or,, aud all. property use& ..or lntended~ for' ox- tlngulshingfLn8, publlo 8rounda.W all other : .:~;property dewted eroluslw4~ to the use and bene- :..'rit:or the public ShaJ. be exempt from famed I~~..oaXesnd'from taxation,, provided, nothIn here-, I in rhell~prevent the enfoxwement 0s the vendor8 lien,, the~?neohaulo8 or builders lien, or other Unns nq-exlstlng.~ ,. In State v* city 0s 81 Paso, 135 'per. 359, 143 S.Y. (26) 366, the SupreamCourt said vlth referenoq to the8S &N?OV181Oll8~ Mr. Rio L. Ladwr, Page 5 lh mu a mlna tio 0s th n eabow-quoted oo a - StitUtiOlUl pFOV18ionr diSOlO8e8 that N CQWtbtO t0 O%tb@t n\miOi~l OO~lF8tiOll8 flWl# 0.d~ thW0 ObSS@S Of tUO8. %&OS0 8W ad V8b’681;UQS, OOO~&tlOll b.XS8,sndinO~ $a%es." RegudleSS Of I&O~~OP t-h0 wonts in 1iOU. Of tU08' imposed UpoP OitiOS aad~tWIi0 w 8. B. 520 be eQ)sI Sidsrrd M ad YjON tUO8 Ob U OO~tiorr t&WE, the mOti= Of SUOh WStOIhtS ObV%0~84 18 IMOOWti~tid. If ths PEyWI¶tS b0 ~~~mnd U ad vdOm ~uOS# whvr 01~a~40rrend theaboveproylnion8eitherbybelngba8ed upon au utlffofal rather than aa aatual value 0s the, propertyor by be-- Zlltpo8edupon the property of a:En+ nlolpal aorporatlcax. Llkevlu, if thements be ooa- aldered u oOoUp&lOA tUtUS ,theytmUmn~r~p~b~ tlCULagskut tbs bp3Sfti~ Of this m Of tU Upon the aotlvltle8 of a muafofpalaorporatfoa. If it bs OOIitOndOd tht the80 pWIItCULt8 ~0 neitherad valolur nor oooupatlon taxes, that Thor am some speoler or tertlu qald vhiah oanoponte u do Ol’dflW7 t&WE, OaO aCrOaOgl%Sh thO ~808 t.hOWOf, but \. aane8mpe the Umftatlons thereoni the uuvsr.to suah 0ontentioB fs plaia. What cannot be don0 dlreotly oaa- not be aeoapll8hed by lndlreotlon~ aotloa 1s udged by ~ltr efreot rathar~than by Its label. To ooao a e thatmu- alofpal property owl0 for generating end aiStF;buting ~: eleotrlolt~ uamot be c ~wub eat 0s au o&~alorsm tar’of ‘this typwand that a mudo& PA lty oaunot be subjeoted to an oooupation tm ?3y visitor it8 aotlvltle8 in generat- %ng aud dlstrfbutlng eleatrlolty, yet at the 88xte tftne to aver that a legal exaot$on oslled a *payment ln lieu 0s ~' torus* maf bo had lrom naiol 8lit~es beaauaa 0s their ovaersaLp or 8wh property Ku3 theirelIfJagiagkr.SUdl aotlvitles uoulcl be to elevate form ovep rubetanoc and to point .the~980,to an e&Sy evaalan 0r the llmltatlonr * pored by our Carutltutlca upon the paves to t8x. Cotiequent~, you are rerpeoti\lllp advised 'that the pr6vlslon8 oontalned la theaeoond paragraph 0s Sub- dlYi8iOn k Of Sectlorr 1 Of H. B. 520 relating to the , 1 * Hr. Rfo L. Ladnor, Page 6 I 1 exaation of *payment8 in lieu of tu08* fn?u altA@s 8ml tows under the alrowstanoes and la thememnertherela 1 Set forth U@ tiObt%ve Of the 8bOw QAOtti pOPtlCUI8 Of our Con8tftutloa. As a matit of tbi8 oonolusion theM is noneedto enter into8 8e~uakdi8ou88laa10r the oonrt.ltutlanJit~of theprovz8oto thbpar&gmphab~ut vhbh you IaqvlMd. ThlseplnfoafslnaoltaytobeooMtruedu p&SSing UpOX& thO OOZl8titUtZbXMl%t~ Of th0 f%Mt m graphofsubalvlslon4arelatfq to theexaotlonorpay~ SWtS irru.OU Of tUO8 frco thO diEtriOt a& 8UthOPitieS tbarelndesarlbed~ aeltherdeue espress may opinlozlhere- in 88 to the valldlty 0s the last prnsrsphorsub-dlvi81oa 48 Mb&t&g t0 VOlUilkl7 OsyPleatS b OitfeS 8tld tOlfM~ ‘Pnutlna that the r0mg0ing ratfefaotorlly en- avers your lnqulry, vu are .