DAN MORALES 

ATTORNEY GENERAL 

QBffice of the !Zlttornep Qkneral 

$Mate of aexae 

April 20,1992 

Mr. Larry E. Kosta 

Executive Director 

Texas Department of Licensing 

and Regulation 

P. 0. Box 12157 

Austin Texas 78711 

Opinion No. DM-110 

Re: Whether section 11(b) of the Texas 

Boxing and Wrestling Act, V.T.C.S. article 

8501-1, applies to cable television companies 

collecting pay-per-view fees from subscribers 

viewing live telecasts of professional boxing 

performances (RQ-208) 

Dear Mr. Kosta: 

The Texas Boxing and Wrestling Act (the act), V.T.C.S. article 8501-1, 

requires the Texas Department of Licensing and Regulation (the department) to 

collect a three percent gross receipts tax on admission fees charged to view a boxing 

match, contest, or exhibition conducted in Texas or shown on closed circuit telecasts 

in Texas. V.T.C.S. art. 8501-1,s 11(a), (b). Section 11(b), which applies specifically 

to persons charging admission fees for exhibiting a live telecast of a boxing match on 

closed circuit television, also requires such persons to acquire a boxing promoter’s 

license and to obtain a permit for each closed circuit telecast shown in Texas. 

Section 11(b) of the act states: 

Any person who charges an admission fee for exhibiting a 

simultaneous telecast of any live, spontaneous, or current boxing 

match, contest, or exhibition on a closed circuit telecast must 

possess a boxing promoter’s license issued pursuant to this Act 

and must obtain a permit for each closed circuit telecast shown 

in Texas. The [three percent] gross receipts tax. . . is applicable 

to ,said telecast, and the boxing promoter shall furnish to the 

department within 72 hours after the event a duly verified report 

on a form furnished by the department showing the number of 

tickets sold, prices charged, and amount of gross receipts 

obtained from the event. A cashier’s check or money order 

p* 557 
Mr. Larry Kosta - Page 2 (DM-110) 

made payable to the State of Texas in the amount of the tax due 

shall be attached to the verified report. 

The state deposits the money it receives as a result of the gross receipts tax into the 

General Revenue Fund. V.T.C.S. art. 8501.1, # 11(c). You request our opinion as 

to whether section 11(b) applies to cable television companies that collect from 

their subscribers special pay-per-view fees, entitling each paying subscriber to watch 

a simultaneous telecast of live boxing matches. If section 11(b) does apply to payper-view cable television companies, each pay-per-view cable television company 

offering simultaneous telecasts of live boxing matches must acquire a promoter’s 

license, obtain a permit, and pay the three percent gross receipts tax. The ultimate 

issue is whether “admission fee,” as section 11(b) of the act uses that term, includes 

the special pay-per-view fees cable television subscribers pay to cable television 

companies for the privilege of viewing simultaneous telecasts of live boxing 

matches.’ 

Former article 614-1 of the Texas Penal Code was the predecessor statute to 

article 8501-1, V.T.C.S. See S.B. 34, Acts 1973,63d Leg.. ch. 399,s 5, at 995. 996b. 

The Texas Court of Civil Appeals, in a case involving former article 614-1 stated 

that the article “strictly regulated” boxing activity, that is, the article was designed to 

control all aspects of the professional boxing industty in Texas. Hwvq~ v. Morgan, 

272 S.WL?d 621, 622 (Tex. Civ. App.-Austin 1954, writ refd n.r.e.). While the 

legislature has amended former article 614-1 of the Penal Code and its successor, 

article 8501-1, V.T.C.S., since the Court of Civil Appeals decided Hmvey, the 

current statute continues to strictly regulate boxing in the State of Texas. See 

V.T.C.S. art. 8501.1,s 2. 

Principles of statutory construction require us to construe statutes in such a 

manner as to accomplish the legislative intent- Attorney General Opinions M-119 

(1967) at 2 (quoting 53 TEX. JUR. 26 Skafut~ 0 134, at 195-6 (1964)); M-156 (1967) 

tWefouadconflictingauthaiticsonwhcthcrthcterm~clostdcLcuittclcclrsf’~itispcedin 

section ll@) of the. act, can be cmstnud to iwhlc “cable television,’ as the consuming public 

uodorstwds the term “cable. tclcvisioo: compmr E. Foster, UNDERSIZING BRIG 38, 

4554% (1979) (defining and discmiq dosed circuit tekvirion and cable tchisioa) and WEBSER’S 

NINIH NEW CotJXGIM'E DIC~ONARY 193,w) (1987) (defining ‘c&k,- “cable television,’ and ‘closed 

circuit.) kth &%“i”~ of SpOm Ewnts, 34 F.C.C.Zd ml, 280 pare 36 (lm) (dis- dosed 

circuit telcvhion flom subscription cable tel&ion for pu?poscs of anti-siphoning rule). As WC can 

dccidc the issue yo” prc.scot 00 the basis of the mcauing of tbe term “*dmission fc%. we do not discuss 

whcthu “clod circuit telecast” can be construed to include pay-per-view tckasts. 

p. 558 
Mr. Larry Kosta - Page 3 (DM-110) 

at l-2 (citing Indepndent Life Ins. Co. of Am v. Work, 124 Tex. 281,77 S.W.2d 1036 

(1934)). We must continually bear in mind, however, that statutes should be 

construed in light of the evil the legislature sought to avoid by enacting the statute. 

Attorney General Opinion WW-516 (1958) at 3 (citing Wortham v. Wdker, 133 Tex. 

255, 128 S.W.2d 1138 (1939); Texa & N.O. RR Co. v. Railroad Comm’n, 145 Tex. 

541, 200 S.W.2d 626 (1947); 34 T&x. DIGEST Strmctes g 184); see also Attorney 

General Opinion M-119 at 3. Here. while the act’s statement of purpose indicates a 

legislative intent strictly to regulate the boxing and wrestling industry in this state, 

we have found no legislative history indicating the evil the legislature designed 

article 8501-l or its predecessor to constrain. Furthermore, we have found no 

legislative history indicating either the legislature’s understanding of the terms 

“admission fee,” as it used the term in section 11(b) of the act, or the evil the 

legislature seeks to avoid by taxing admission fees to closed circuit telecasts. Thus, 

we must construe “admission fee” solely on the basis of the plain language of the 

statute. 

When construing a statute, we presume that the legislature used words and 

phrases in the sense in which they are commonly understood. See Gov’t Code 

g 311.011(a); 67 TEX. JUR. 3d Statures 0 132, at 737 (1989). The phrase “admission 

fee” is commonly understood to comtote a sum of money one pays to enter a place, 

such as a theater, an arena, or a concert hall. See WEBSTER’s NINTH NEW 

COLLEGIATE DICTIONARY 57 (1987) (defining “admission”). In common usage, 

“admission fee” does not connote a sum of money one pays to view a movie, concert, 

or sporting event on one’s own television, sitting in one’s own home. In our opinion, 

to construe “admission fee” as it is used in section 11(b) of the act to include payper-view fees goes beyond liberally construing the statute; rather, it tortures the 

plain language of the subsection to construe the term in this way. 

Accordingly, as far as we can ascertain the legislature’s intent, the legislature 

enacted section 11(b) to impose a tax only on fees people paid to enter into a place 

for the purpose of viewing a simultaneous closed circuit telecast of a live boxing 

performance. We note that pay-per-view telecasts of live boxing matches were 

unavailable in 1977, when the legislature added section 11(b) to the act to impose a 

gross receipts tax on admission fees paid to view closed circuit telecasts of live 

boxing matches. Thus, at the time the legislature added section 11(b), it may not 

have contemplated that pay-per-view telecasts one day would be available. 

Consequently, we conclude that pay-per-view fees are not subject to the three 

percent gross receipts tax on admission fees imposed by section 11(b) of the act, and 

p. 559 
Mr. Larry Kosta - Page 4 (~~-110) 

cable television companies need not acquire a boxing promoter’s license and obtain 

a permit for each telecast of a live boxing performance. 

SUMMARY 

Cable television companies collecting a special pay-per-view 

fee from subscribers who wish to view a simultaneous telecast of 

a live boxing performance are not subject to V.T.C.S. article 

8501-l. section 11(b). 

DAN MORALES 

Attorney General of Texas 

WILL PRYOR 

First Assistant Attorney General 

MARYKELLER 

Deputy Assistant Attorney General 

RENEAHIcKs 

Special Assistant Attorney General 

MADELEINE B. JOHNSON 

Chair, Opinion Committee 

Prepared by Kymberly Oltrogge 

Assistant Attorney General 

p. 560