OFFICE OF THE AlTORNEY GENERAL OF TEXAS
AUSTIN
Honorable T. M. Trimble, First Assistant
Stste Superintsndentor Xblio Inetruotlon
Austin, Texas
Dear Sir:
Opinion f?6. O-3922
Ra: Oeoupatlontax on utlllties
We have reoelved ~yourletter of Au+st 28, 1911,
In whlah you enolose a latter to you from Mr. E. A. Parrin,
Sugarintendantof the Cmaron Public Sohocls. Mr. Parrin's
letter reads In part as follows:
*The Cameron Bohcol Dlstrlot is a school
diatrlot In whloh the city haa assumed oontrol.
The alty tax assessor oollaota our tax, both
malntenanoe end bond. The olty oounoil turns over
to our tra&surrr 756 on $100.00 aasaeaad valuation
for the maintananoa or our aohool. They pay the
bonded lndebtadnesadirect. Our sohool beard is
eleotad.
*The LegislatureHoently approved a special
tax whlah should be paid to the oity governments
by the utility oompanies.The eleotrio oompany,
the water oompany, the gas aompany,.andthe tela-
hone oompany pay to the,oi,tyapproximately
{2,500.00 annually. I auppoae this ia an oooupation
tax.
"I wish to know Ii the sohoola are entitled to
partlolpatain this tax and if so, to what extent."
The Forty-seventhLfqti~latura et Its regular
session passed IIouseBill 8, the Omnibus Tax Law. Artiole
7070, R.C.!?.,as amended by Artiole IV of Rouse Bill 8
levies e State coounationtax on telephone oorcl:?anies.
Eowever, seotion 2 of Artiole 7070, as amended, read8 as
r0ilowf3:
X6norable T. ?J.‘?rIr.ble,
yego 2
*(zi NC city or ottor polItIocrlsubdlvialon
or t.Elsmxe‘e, by YlTtue or Its texklg wwr,
:lollaaFewer, or otherwlee,shall Xa~otceau occu-
pation tax or charge or sny sort, for tha ;*rIvlle@
0r Uolnc ?as%ness, upon any psrcaon, oor::oPa*ion,
or a*aociatIozi
required to pay an 0oou;ation tax
under this Art&la; provldrd, that nothlna in thla
ArtIols aball ba oonatrued to prohlbIt the oolleotlon
or UC vitlor~~~
t&sea as provided or not prohibIted by
law, or any tax now 1n;poaadby franohisc,and provided
!‘urtharthat thl8 Artlola ah811 not wrreot any oon-
treat now in exlstmoe or hereafter nodo butwosn a
city and the holder of a franchise.*
rirtielo7060, R.C.“., a8 .monded by Artialo tr
or Rouse 8111 8, levies a state oooupatIoatax on aa8
oaapanlea,eleutr10 light ooqanlee, oleotrio povbs ema-
panles, and water work8 or water end U&t plant8 boated
in any inoorporatadtonn or olty and uscrdTor looal.aale aml
dl~trtbutlon. ikwever, the r0u054hg provltilc4 lp:wara:
Wo city or other polftleal mubdlvlsIonof
this Sate, by virtue of its taxing power
proprlstary poacr, poUc4 power or othalwr~,
shall 218~0s~an ooougrtkm tax or ehbrge or my
eort upon any p er so n,
o o r p o r utloo ar i,
lrao6letlon
ropuir6d to pay tin ooour&ion tax under this
Artlolc. ~?othIn~in thi6 Artlale shall ba ooa-
atrueb am arrecting In any way the oolleotlon 0r
ad valorem tnxos authorlaad by law: nor Impalrlng
or altering In any.way the plwleions of any
oontraota, agr6ementt3, or rranahleer now in
lxlstanoa, or horaartortasdebataaen 4 city and 4
putiio utility, ralatinp,to psyzentr. or any sort
to a olty. Rothtng in this Article shall be eon-
*trued ea ycohlb:tin&an fnoorsoratedolty Or town
fior mk:ny: a~remonsb1.e oharE6, otimrwlslalawful, for
thb us6 of its a~troets,alloys, and publlo waye by a
gub,fIoutmltp In tba conduct of lta buaiWea, and
each auah oity she:1 have such right and ?owerg but
any ouch oJxwgea, whether Os~igristsd66 r~ntubi or
Ronarable T. I:.Trlmbie, Pa3 3
otherwise, end whether measured by gross receipts,
units of installation,or in any manner, shall not
in the eg,gregateexceed the equlvelent of two (2)
per cent of the floss receipts or such utility
eithln suah municipalityderived from the sale of
ivs, electric ener'py,or water. Any speclel taxes,
rentals, aontributions,or char&es accruing after
the effective date of this Act, under the terms or
any pre-existingcontrsct or franchise, ageinst any
utility paying sn occupation tax under this Artlale,
when paid to any such city, shall bacrcdlted on
the amount owed by such public utility on any charge
: or rental~im?osedfor the use ot streets, alleys, and
public ways, levied by ordinenae, and accruing after
the effective date of this Act; prov~ldedthat where
valid ordinances have been enacted heretofore by
cities imposing 6 charge or rental in excess of two
(2) per cent of the gross receipts of such utilities,
nothing herein shall be aonstrued so as to prohibit
the aolleation of such sums as mey be due said
cities thereunder from the date of said ordinanaeaup
to the times this Article shall become errective."
Thus, we see that the povterto impose occupation
taxes on the businessesnamed in the above mentioned statutory
provisionsie expressly denied to cities or other political
subdivisionsof this stete. It follows that there is no city
tax under these provisions in which the city sohools are en-
titled to'participate.
&ticla'Xx or House .Blll8 provides for the dls-
position and allooation of revenue derived and collected
under Articles IV and V. One-fourth or such revenue Is to
be deposited with the State Treasurer to the credit of the
Available School Fund. The balance of the revenue la to be
deposlted in a Clearance Fund in the Treasury. Then there
are provisions for the.e~propriation,trensfer, and ellocation
or certecinnmounts of the moneys rro?;the Clearsnce Fund
to the Blind Assistance Fund, the Children AssistanceFund,
the Old Age AssistanceFund,
the Teacher Retirement ?ysts.;*:,
and the CXneral Revenue Fund.
Eonortible
T. X. Trimble, Page 4
If the statutoryprovisionswhich we have con-
eidered ere not the ones to which you here reference,
please notiry us.
Very truly yours
By Lk@&
ATTORIWY Gq Glenn R. Lewis
Assistant