JIM MATTOX 

Attorney General 

The Attorrwy General of Texas 

July 17, 1986 

Supreme Court Building 

P. 0. BOX 12546 

Austin, TX. 7671% 2546 

512,4752501 

Mr. Llas B. "Bubba" Siteen 

Executive Director 

State Purchasing and General 

Opinion No. JM-523 

Re: Whether the city of Austin 

Telex 9101674-1367 

Telecopier 512/475-0268 

Services Commiss:.on may assess a capital recovery 

P. 0. Box 13047, Cal'itol Station fee on state construction proAustin, Texas 787:.1. jects 

714 Jackson, Suite 700 

Dallas. TX. 752024506 

214/74&3344 

Dear Mr. Steen: 

4624 AlbeRa Ave., Suite 164 

El Paso. TX. 799052793 

9151533-3464 

pl Texas. Suite 700 

ston, TX. 77002~3111 

I ,Y223-5866 

604 Broadway, Suite 312 

Lubbock. TX. 79401.3479 

80617476236 

4309 N. Tenth, Suite S 

McAllen, TX. 76601-1665 

512,662-4547 

200 Main Plaza, Suite 400 

San Antonio, TX. 762052797 

5121225-4191 

An Equal Opportunity/ 

Affirmative Action Employer 

You ask whethlnr a home rule city may legally assess capital 

recovery fees against state construction projects. The city requires 

that the owner of any new construction must pay a capital recovery fee 

at the time a water t:ap is purchased. The amount of the fee is determined by the size and type of water meter required for the project. 

The fees are intentled to include both the actual costs of providing 

new service to a specific site and the estimated proportional cost of 

building and maintaining the general water infrastructure to meet the 

collective demands o:E all new development. You assert that the city 

may not assess these fees against state construction projects. 

The question ,p:cesented is one raised but left unanswered in 

Maverick County Watlz: Control and Improvement District No. 1 v. State, 

456 S.W.2d 204 (Tel:. Civ. App. - San Antonio 1970. writ ref'd) and 

Attorney General Opinion l&-551 (1982). A central question in 

Maverick involved the nature of the charges -- whether they constltuted a tax or a special assessment. Special assessments differ from 

general taxes insof,sr as special assessments are levied only on land, 

the amount based on the benefits conferred to the land; a special 

assessment is uniqw as to time and locality. See generally 456 S.W.2d 

204, note 4 (cases cited therein); Londerholm V. City of Topeka, 443 

P.2d 240 (Kan. 196,s). The Maverick court held that state statutes 

clearly exempt stat,e property from taxation by a water control and 

improvement district so long as the state holds full legal title to 

the property. 456 S.W.2d at 206 (relying on article 7150, V.T.C.S., 

now replaced by Tex. Prop. Code 111.11); see also Tex. Const. art. XI, 

59; City of Beaumo:z: v. Fertitta, 415 S.W.2d 902 (Tex. 1967). The 

court acknowledged 1:hat the legal ramifications of special assessments 

differ from those of a tax, noting Wichita County Water Improvement 

District No. 2 v. l:ity of Wichita Falls, 323 S.W.2d 298 (Tex. Civ. 

APP __ . - Fort Worth r359. writ ref'd n.r.e.) in which the court held 

that a city was 1:table for special assessments levied by a water 

p. 2403 
Mr. Lias B. "Bubba" Steen - Page 2 (JM-523) 

district. The court in Wichita County reasoned that a special assessment is not a tax withinthe meaning of constitutional and statutory 

provisions exempting public property from taxation. 323 S.W.2d at 

300. The Maverick court found it unnecessary to determine whether a 

special assessment is a tax for those purposes because it adopted the 

common law rule that a polil:ical subdivision of the state cannot levy 

a special assessment against state property without express legislative authority. 456 S.W.;:d at 206-07. Attorney General Opinion 

MW-551 applied this reasoning to a home rule city and decided that a 

home rule city may not legally levy a drainage fee against state-owned 

property. 

On the other hand, home rule cities have full authority to do 

anything the legislature could authorize them to do. Lower Colorado 

River Authority v. City of San Marcos, 523 S.W.2d 641, 643 (Tex. 

1975). Accordingly, as a &neral rule, it is necessary to look to 

legislative limitations on the power of home rule cities rather than 

to specific grants of pow=::.. Id. The Maverick court dealt with a 

water control and improvement district, a political subdivision which 

holds only the powers granted to it expressly or by necessary implication by the constitution or statutes of this state. A home rule 

city’s powers, however, are limited to the area of Its jurisdictfon. 

The issue at hand has state-wide implications. Attorney General 

Opinion MW-551 applied the 'zaverick case to a home rule city but did 

not address the different le:vels of power held by home rule cities and 

special districts. The sources cited by the Maverick court, however, 

suggest that its holding was intended to be broad. See 456 S.W.2d at 

207. note 6 (cases cited therein). Levying special assessments 

against the state requires authorization from the state legislature. 

See & Accordingly, we conclude that the Maverick rule applies to 

n political subdivisions, including home rule cities. 

Nevertheless, the impact of Maverick is limited. The court 

stated: 

Even if it be ,assumed that a county or municipality is subject to special assessments levied by 

another political subdivision of the State, it does 

not necessarily follow that a subordinate political 

subdivision can impose an involuntary monetary 

obligation on the sovereign. It is generally held 

that, in the absence of clear legislative authorisadon. a political :subdivision of the State has no 

power to levy a special assessment against State 

property. [Footnote omitted]. We adopt this view 

at least in a case where, as here, the sovereign is 

neither making no; contemplating any use of the 

allegedly benefittid land and has neither received 

p. 2404 
Mr. Lias B. "Bubba" Steen - 'Page 3 (JM-523) 

nor requested the services rendered by the assessing 

agency. (Emphasis added). 

456 S.W.2d at 207. Similarly, Attorney General Opinion MW-551 

emphasized that it did not purport to address a situation where the 

state acted in a manner that indicated a willingness to pay a fee. In 

the question presented, the :state is requesting water service from the 

city. 

Maverick stands for the proposition that the city cannot impose 

an involuntary monetary &ligation on the state without express 

legislative authorization. Accordingly, the city cannot treat state 

property in the same manner as private property with regard to special 

assessments for local improvements. It does not follow, however, that 

the city cannot charge the state for the actual cost of extending 

service which the state expressly requests. As indicated previously, 

the fees in question are intended to include both the actual costs of 

providing new water service to a specific site and the estimated 

proportional cost of build:_ng the general infrastructure. To the 

extent that the city can dc:termine the actual costs, both general and 

specific, attributable to faxtending service to the state, we do not 

believe that Maverick prevarnts the city from requiring the state to 

pay those costs as a cond::tion of extending service. The city may 

not, however, assess the s1:ate for its pro-rata share of the cost of 

local improvements which provide benefits that are too general to 

specifically apportion to each user. 

Further, we emphasize that any "exemption" for state property 

from special assessments by political subdivisions is limited to 

property used exclusively for public purposes. It is well-settled in 

Texas that the constitutLona1 and statutory exemption of state 

property from taxes applies only when the nrouerty is used exclusivelv 

for public purposes,. See Satterlee V. - Gulf Coast Waste Disposal 

Authority, 576 S.W.2d 77nTex. 1978); State V. Houston Lighting and 

Power Co., 609 S.W.2d 263 (Tex. Civ. App. - Corpus Christi 1980. writ 

ref'd7r.e.); Attorney C,eneral Opinion MW-430 (1982); see also -- 

Central Appraisal District of Erath County V. Pecan Valley Facilities, 

Inc., 704 S.W.2d 86 (Tex. App. - Eastland 1985. no writ). We belfeve 

that the courts of this state would apply similar restrictions to the 

common law "exemption" from special assessments announced in the 

Maverick case. This conclusion finds support in the sources relied 

upon in Maverick. For example, one such source states the general 

rule as follows: 

Apart from constitutional or statutory authorization public property . . . used for public 

purposes is not liable to special assessment for 

local improvement:;.. . . . (Emphasis added). 

p. 2405 
Mr. Lias B. "Bubba" Steen - Page 4 (JM-523) 

14 McQuillin, Municipal Corporations (3d. ed., rev. 1970) §38.73 

(cited in Maverick County, 456 S.W.2d at 207, note 6). 

SUMMARY 

Without express constitutional or legislative 

authorization, a 'home rule city may not levy 

special assessmen:s; against state property which 

is used solely fo,c public purposes. This general 

rule, however, i.oes not prevent a city from 

c requiring the state to pay the actual costs 

attributable to extending service to the state 

when the state recuests 

JIM MATTOX 

Attorney General of Texas 

JACK HIGHTOWER 

First Assistant Attorney General 

MARY KELLER 

Executive Assistant Attorney General 

RICK GILPIN 

Chairman. Opinion Committee 

Prepared by Jennifer Riggs 

Assistant Attorney General 

p. 2406