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### THE ATTORNEY GENERAL OF TEXAS
December

23,1987

Honorable Ii.Tati Santiesteban Opinion No.

### m-836 Chairman Natural Resources Committee Re: Whether taxes on a Texas State Senate defined area or desigP. 0. Box 12068 nated property to pay Austin, Texas 78711 for improvements are, by their nature, authorized by article XVI, section 59, of the Texas Constitution (RQ-1245)
Dear Senator Santiesteban:
You ask our opinion about the constitutionality of House Bill No. 2571, Acts 1987, 70th Legislature, chapter 600, at 4700, which authorizes municipal utility districts operating under chapter 54 ofthe Water Code to issue "defined area bonds" to provide for facilities serving only adefined area ordesignated real property within the district. You note that the legislation requires that the bonds be approved byvoters within the defined area or designated property, and that & property within the area isto be subject to an advalorem tax topay the interest and principal due onthe bonds issued topay for improvements. (Theproperty within the defined area, of course, remains subject to taxes levied to pay for improvements benefitting the entire district.) See generally Water Code §§54.801-54.812. Specifically, you ask whether taxes levied & on certain property within a district to repay bonds issued to finance improvements benefitting & that property are, by their nature, "equally distributed" within the meaning ofarticle XVI, section 59, of the constitution. We conclude that such taxes are equally distributed as required bythe constitution.
InDallas Countv Levee District No. 2 v. Loonev 207 S.W. 310 (Tex. 1918), the Supreme Court provided what'must be considered aclassic explanation ofthe nature ofthe "equal distribution" requirement ofarticle XVI, section 59:



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The declaration [inarticle XVI, section 591 that the taxes shall be 'equally distributed' simply means that they must be fairly proportioned according tobenefit to the property taxed. . . . In aword, they must fairly represent the benefit to the property. . . . Themeasure of benefit that will accrue toproperty from a local improvement is at best anapproximation, and hence there isno general principal ofconstitutional law that inthe imposition of such taxes limits the legislative power to the exact amount of pecuniary benefit which the particular property derives. While in some instances the benefit may be generally distributed throughout the district, inothers itmay be more confined. . . .

. . . . The effect of [article XVI, section 591 simply isthat [atax] shall be justly laid in fair proportion tothe benefit. If it is so proportioned, then there can be no question but that an 'equal distribution' of the taxes will be accomplished within the full meaning ofthe term. 207 S.W. at 312-13. All that House Bill No. 2571 does, then, is tomake plain aconstitutional principal which has long governed the execution by adistrict of its constitutional mandate. Accordingly, House Bill No. 2571, Acts 1987, 70th Legislature, chapter 600, at 4700 and Water Code sections 54.801-54.812, provides for the equal distribution of a defined area ordesignated property tax as required by article XVI. section 59, ofthe Texas Constitution.

. JIM MATTOX Attorney General ofTexas

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MARYKELLeR Executive Assistant Attorney General
JUDGE ZOLLIE STEAKLEY Special Assistant Attorney General
RICK GILPIN Chairman, Opinion Committee Prepared byKaren C.Gladney Assistant Attorney General

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