*1 OFFICE OF THE AlTORNEY GENERAL OF TEXAS AUSTIN

Honorable T. M. Trimble, First Assistant

Stste Superintsndent Xblio Inetruotlon Austin, Texas

Dear Sir:

Opinion f?6. O-3922 Ra: Oeoupatlon tax on utlllties We have reoelved ~your letter of Au+st 28, 1911, In whlah you enolose a latter to you from Mr. E. A. Parrin, Sugarintendant of 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 on $100.00 aasaeaad valuation for the maintananoa our aohool. They pay the bonded lndebtadnesa direct. Our sohool beard is eleotad.

*The Legislature Hoently 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, .and the tela-

hone oompany pay to the, oi,ty approximately {2,500.00 annually. I auppoae this ia an oooupation tax.

"I wish to know Ii the sohoola are entitled to partlolpata in this tax and if so, to what extent."

The Forty-seventh Lfqti~latura et Its regular session passed IIouse Bill 8, the Omnibus Tax Law. Artiole 7070, R.C.!?., as amended by Artiole IV of Rouse Bill 8 levies e State coounation tax on telephone oorcl:?anies. Eowever , seotion 2 of Artiole as amended, read8 as r0ilowf3:

X6norable T. ?J. ‘?rIr.ble, yego 2

*(zi NC city or ottor polItIocrl subdlvialon or t.Els mxe‘e, by YlTtue or Its texklg wwr, :lollaa Fewer, or otherwlee, shall Xa~otce au 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;poaad by franohisc, and provided !‘urthar that thl8 Artlola ah811 not wrreot any oon- treat now exlstmoe or hereafter nodo butwosn a city and the holder of a franchise.*

rirtielo R.C.“., a8 .monded by Artialo tr or Rouse 8111 8, levies a state oooupatIoa tax on aa8 oaapanlea, eleutr10 light ooqanlee, oleotrio povbs ema- panles, and water work8 or water end U&t plant8 boated in any inoorporatad tonn or olty and uscrd Tor looal. aale aml dl~trtbutlon. ikwever, the r0u054hg provltilc4 l p:wara:

Wo city or other polftleal mubdlvlsIon of 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 person, o o r p o rutloai, o r l rao6letlon 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 altering In any.way plwleions of any oontraota, l xlstanoa, horaartor tasde bataaen city and 4 agr6ementt3, or rranahleer now in putiio utility, ralatinp, to psyzentr. or any sort to a olty. Rothtng in this Article shall be eon- *trued ea ycohlb:tin& an fnoorsorated olty Or town fior mk:ny: a~ remonsb1.e oharE6, otimrwlsla lawful, for thb us6 of its a~troets, alloys, and publlo waye by a gub,fIo utmltp In tba conduct of lta buaiWea, and each auah oity she:1 have such right and ?owerg but any ouch oJxwgea, whether Os~igristsd 66 r~ntubi or *3 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,gregate exceed the equlvelent of two (2) per cent of the floss receipts or such utility eithln suah municipality derived 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-existing contrsct 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?osed for the use ot streets, alleys, and

public ways, levied by ordinenae, and accruing after the effective date of this Act; prov~lded that 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 ordinanaea up to the times this Article shall become errective."

Thus, we see that the povter to impose occupation taxes on the businesses named above mentioned statutory provisions ie expressly denied to cities or other political subdivisions of 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 .Blll 8 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 certecin nmounts of the moneys rro?; the Clearsnce Fund to the Blind Assistance Fund, the Children Assistance Fund, the Teacher Retirement ?ysts.;*:, the Old Age Assistance Fund, and the CXneral Revenue Fund.

Eonortible T. X. Trimble, Page 4

If the statutory provisions which 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