QBffice of tfy Bttornep dbmerat 

DAN MORALES 

ATTORNEY GENERAL 

&ate of Qexae 

April 26,1993 

Honorable Tom Craddick 

Chairman 

Committee on Public He&b 

Texas House of Representatives 

P.O. Box 2910 

Austin, Texas 78768-2910 

Option No. DM-218 

Re: wllether an additional sales and use tax 

under section 321.101(b) of the Tax Code may 

be used to finance a homestead exemption, 

whethex an eligible city may simultatlMusly 

adopt sales and use taxes under both sections 

4A and 4B of V.T.C.S. article 5190.6, and 

dated questions (RQ-466) 

DetKRepresentativecraddick: 

On behalf of the city of Cedar Hill (the “city”), you have asked several questions 

about sales and use taxes. Pii you ask whether an additional sates and use tax under 

section 321.101(b) of the Tax Code may be- used to tlnance a homestead exemption 

instead of reducing the property tax rate. 

Section 321.101(b) provides that certain municipalities “may, by a majority vote of 

the quahied voters. . . adopt an additional sales and use tax for the benefit of the 

mtmicipality in accordattm with this chapter... .“I The 1~ has expressly 

prescrii the use of revemre collected under section 321.101(b). Revenues from an 

additional sales and use tax under this chapter must first be used to reduce the property 

tax rate. See Tax Code 8 321.404(a) (mquking that a ballot in an election to adopt an 

~dltionalsales~dwetaxJpecifythatthetaxwill”beusedtoreduccthepropcrtytax 

rate”); see also id. 5 321.507 (citing Tax Code. 58 26.04(c) and 26.041(d), and providing 

that excess funds must be deposited in an “excess sales tax revenue fund” and a “municipal 

sales tax debt service timd,” which may only be expended for limited purposes); 8 321.506 

(goveming the use of any remain@ funds).2 

p. 1144 
Honorable Tom Craddick - Page. 2 (nu-218) 

Whenagovaningbodylldoptsahomest~aanption,itacanptsfromrd 

u&rent taxation a prcmtqe of the appraised value of residence homesteads. See Tax 

Code 0 11.13. A homestead exemption does not reduce the prop@ tar rate. The 

memorandum submitted with your request suggests~that this distinction is immaterial 

because the purpose of the additional sales and use ULX under section 321.101(b) is to 

reduce the tax burden on property owners. It contends that cities should have the 

authority to determine how to achieve that end, idding adopting a homestead 

exemption in lieu of redueing the property tax rate. We dimgree. 

While a homestead exemption reduces the tax burden on residential property by 

exempting a portion of the appraised vahre of residences from taxation, it does not reduce 

the tax burden on non-residential property. See id. The legislature has specifically 

provided that the purpose ofthe additional sales and use tax under section 321.101(b) is 

to reduce the property tax rite, and has set fbrtb a number of provisions which explicitly 

govern the use of these revenues. See Tax Code, 5 321404(a); see CrLao id. $8 26.04(c). 

26.041(d). 321.506, and 321.507. None of these provisions permits a city to use an 

additionalsalesanduse~toreduccthetaxbPlrdmofresideatialpropatyumilenot 

reducing the. tax burdem of non-residential proper@ Because a homestead exemption 

doesnotreducethepropatytaxnteasnquindbytheseprovisions,wecwclude~a 

municipalityisnotauthorizedtousean~~tio~saluMdusetaxundasection 

321.101(b)oftheTaxCodetofinanceahomesteadexemption. 

Second,youexplainthatin~~onto~o~aonahallcent~uMdusetax 

tmder section 4B of article 5190.6, V.T.C.S., e&et.& July 1. 1993, the city would also 

liLetoadoptacombined~hafcaapslesudurtraundasection4Aofthat~~e 

and section 321.101(b) of the Tax Code, efktive October 1, 1993, for an overall one 

centsalestax3 ThecitywouldholdMelectionto~optasaesMdusetaxundaeachof 

these provisions on the same day.4 You ask ifthe city is authorized to do so. Section 4A 

and section 4B separately authorize an ‘eligible city” to adopt a sales and use tax. 

Assumingthatacityiseligibleunderbothprovisions,weseenothingin~~e5190.6that 

would suggest that the city may not simultaneously adopt sales and use taxes under both 

section 4A and section 4B. 

You point out that subsection (f) of section 4B provides that “[u@r the e@ctiw 

~eoIthPtmceSinpavdunda~~on,theadoptionofasalesandusetaxorthe 

p. 1145 
Honorable Tom Craddick - Page 3 (DM-2 18) 

Ina~~question,youaJ;whethaaproposaltoadoptasalesaadusetra 

mder section 4B of article 5190.6, on the one hand, and a combmed sales and use tax 

undersection4Aoftbatarticleandsection321.10l(b)oftheTaxCode,ontheother,may 

appedronaballotasasingleballotproposit.ion. Section4A(p)attthbsacitytoimpose 

asalesandusetPruadathat~~aadtoimpo~eanrdditionalsalesMd~taxunder 

section 321.101(b) of the Tax Code “at tbe same time and on the same ballot.” See aku 

V.T.C.S. art. 5190.6, 84A(e). It is clear fkom the ballot hnguage set forth in section 

4A@)~thetwo~~~ontbeballotinthesameproposition. Section 

4A(p) provides in perhent part: 

The city must follow, in relation to tbe imposition. . . of the 

additional sales and use tax imposed under Section 321.101@), Tax 

code,theproozduresofthatchapter,exepttllatinaneleuionto 

impose...thetaxunderthisrection~theldditional~~~~ 

taxthebpllotsMIbeprintedtoprovideforvotiagfororclgainsttbe 

proposition: “Theadoptionofasalesandusetaxwithinthecityfor 

tbepromotionanddevelopmattofnewaudexpandedbushess 

extterprises at the rate of. . . and the adoption of au additional sales 

md~~withinthccity~therateOf...tokusedtonduce.the 

propatytiSXnte”.... 

The foregoing provision sets forth the language which must be used in a ballot 

proposition on the adoption of a combined sales and use tax under section 4A and section 

321.101@). It does not authorize the city to include any other language in the ballot 

proposition. The&ore, we conclude that the city is not authorized to join a proposal to 

adopt a combmed sales and use tax under section 4A and section 321.101(b) and a 

proposal to adopt a sales and use tax under section 4B on the ballot as a single ballot 

proposition. See Wtight v. Bomd of T-es of Tar~m h&p. Sch. Da.., 520 S.W.2d 

787, 792 (Tex. Cii. App.-Tyler 1975, writ dism’d w.o.j.) (“When a statute which 

authoriws a special election for the imposition of a tax prescribes the form in which the 

question shall be submitted to the popular vote, the statute shall be strictly complied 

With.“) 

p. 1146 
Honorable Tom Craddick - Page 4 (DM-2 18) 

You~rsk~meliSiblecitymryrdoptaralesradusetaxrtantelssr 

than one-half of one percent under section 4B, article 5190.6. S§ion (e) of section 

4Bprovides~“[i]f~~~~city~opssth~atmbimposedoatherecciptsfiom 

tbesrle~rrtailof~~~~withinthedigiblecityitanteequJtooaahalfofone 

” Section 4A of article 5190.6 and section 321.101(b) of the Tax Code 

~~.adoptiollofasslesturta*squdu,Dawiehtboabfounbthraeeigtnqor 

one-half of one percat. See V.T.C.S. att. 5190.6, #4A(d), (m), (p); Tax Code 

&j321.lOl(b). 321.103(b). Prior to 1991, both section 4A and section 321.101(b) 

providedonlyforaone-halfofonepercenttaxrate. lal99l,ho~mr,tbeSeventy- 

~~r~unmdcdthere~torllowfor~~undaonahrlfofoae 

paccnt. Acts 1991,72d Leg., ch 184, 00 1,4. Siicantly, the legkture has not 

- amended section 4B to provide for tax rites under one-half of one percent. 

Accwdu& weconclude~~on4Bdossnotruthoriteandisible~toldopta 

saksand&taxataratelessthanoabhaifofoneparcent. 

Pii,youaskwhethermembersofac@%municipaladvisoryboardsarecity 

officers for pwposes of article 5190.6, section 4B(c). Subsection (c) proides that the 

boanlofawrpontionestablisheduad~section4Bcon&sofswendktors,andthat 

“[alt least four dkctors must be pemons who are manbers of the gowning bodyofthe 

eligiile city, and the tEtMkgthnedifWtO~rhallbepWSOltSWhOUeWtemplOyees, 

offi- ormembuaofthe gover&gbodyoftheeligiilecity.” Youatatethatyou 

uadarturdthatmanycitiesiaclude~boardmanbasap”offi~“for~o~ 

purposesintheircitycharter!3andcod es. Thefactthatanadvisotyboardmemberis 

de6nedasacityofficcrinacitycodeorchmter,however, doesnotwcwwilymekehim 

or her an offica fbr purposes of state law in gQleral or atticle 5190.6 in particular. Under 

~isw,rplblicoffi~genenllyhuafaedtamMd~benmmedwlyin 

accordance with the applicable provisions of law. Akfine In&p. SchooJ Dfst. v. S&r&y, 

280 S.W.2d 578 (Tex. 1955). In addition, a public officer is someone upon whom some 

wvereignflmctionofthegovemmt isconfwedfbrthebeneiitoftbepublic,largely 

imkpendentofthewntrolofothus. Id.at583. Anindividualwhoservesinamereiy 

adviwry capacity does not exercise sowreign powexs independent of the wntrol of others 

andisthe&orenotanofficer. ThedetemGnationwhethermembersofaparticular 

mtmicipal advisory board are officers depends upon the foregoing factors and must be 

made on a case-by-case basis. 

SUMMARY 

Acityisnotauthokzcdtouseanadditionalsalesandusetax 

under section 321.101(b) of the Tax Code to fmance a homestead 

CXMtptiOtt. 

Acitythuadoptsaonahalfcent~alwanduseturunder~on 

4BofarticJe5190.6,V.T.C.S..mayalsoadoptinthesameelectiona 

wmbmed on&alf cent sales and use tax under section 4A of that 

articJe and section 321.101(b) of the Tax Code, asskng that the 

p. 1147 
Honorable Tom Cmddick - Page 5 (DM-218) 

cityiseligibleto~~a~alesMd~tucundatheseprovirionsud 

theoveraUsalesandusetaxratewouldnotexceedatntutoryhits. 

Acityisnotauthorizedtojoiaaproposaltoldopta~~Mduse 

tsxundareaion4B,andaw~~~Mdusetaxunda~on 

4A and section 321.101(b), on the ballot as a single ballot 

proposition. Acityisnotauthorizedtoadoptasalesa~~Iuutax 

tmder section 4B at a rate less than one-half of one percent. 

Thehctthatrmunicipalldvisoryboardmcmberisdeihdasa 

cityofficerinacitycodeor~dasnotnecessarilymakehimor 

beranofficerforpurposesofstatelawingeneralorazticle5190.6in 

particular. The determhation wh&er members of a particular 

rmrnicipaladvisoryboardarecityofficersmm%bemadeonacaseby-casebasis. 

DAN MORALES 

Attorney Oeneral of Texas 

WILL PRYOR 

PiiAuistMtAttomeyoweral 

MARYKELLER 

DcputyAttomcyGenemlibrLitigation 

RENEAHlcKs 

State Solicitor 

MADELEINE B. JOHNSON 

Chairs opiion committee 

p. 1148