i 

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 of the Water Code to issue 

"defined area bonds" to provide for facilities serving 

only a defined area or designated real property within the 

district. You note that the legislation requires that the 

bonds be approved by voters within the defined area or 

designated property, and that & property within the 

area is to be subject to an ad valorem tax to pay the 

interest and principal due on the bonds issued to pay for 

improvements. (The property 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 of article XVI, section 59, of the constitution. 

We conclude that such taxes are equally distributed as 

required by the constitution. 

In Dallas Countv Levee District No. 2 v. Loonev 207 

S.W. 310 (Tex. 1918), the Supreme Court provided what'must 

be considered a classic explanation of the nature of the 

"equal distribution" requirement of article XVI, section 

59: 

p. 4023 
Honorable H. Tati Santiesteban - Page 2 LM-836) 

The declaration [in article XVI, section 

591 that the taxes shall be 'equally distributed' simply means that they must be 

fairly proportioned according to benefit to 

the property taxed. . . . In a word, they 

must fairly represent the benefit to the 

property. . . . 

The measure of benefit that will accrue 

to property from a local improvement is at 

best an approximation, and hence there is no 

general principal of constitutional law that 

in the 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, in others it may be 

more confined. . . . 

. . . . 

The effect of [article XVI, section 591 

simply is that [a tax] shall be justly laid 

in fair proportion to the 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 of the term. 

207 S.W. at 312-13. 

All that House Bill No. 2571 does, then, is to make 

plain a constitutional principal which has long governed 

the execution by a district 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 or designated property tax as required by 

article XVI. section 59, of the Texas Constitution. 

. JIM MATTOX 

Attorney General of Texas 

p. 4024 
Honorable H. Tati Santiesteban - Page 3 UM-836) 

MARYKELLeR 

Executive Assistant Attorney General 

JUDGE ZOLLIE STEAKLEY 

Special Assistant Attorney General 

RICK GILPIN 

Chairman, Opinion Committee 

Prepared by Karen C. Gladney 

Assistant Attorney General 

p. 4025