ATTORNEY GENERAL OF TEXAS 

GREG ABBOTT 

The Honorable Cheryl1 Mabray 

Llano County Attorney 

Llano County Courthouse 

801 Ford, Room 111 

Llano, Texas 78643 

August 30,2004 

Opinion No. GA-0242 

Re: Whether a commissioners court may hold an 

election that creates an emergency service district 

and imposes a sales and use tax within the proposed 

district’s boundaries (RQ-0202-GA) 

Dear Ms. Mabray: 

You ask about creating an emergency services district (“ESD”) pursuant to Health and Safety 

Code chapter 776.’ You state that Llano County called for an election to create an ESD in 2002, but 

it was not approved because the citizens did not want more ad valorem taxes. See Request Letter, 

supra note 1, at 1; Tex. Att’y Gen. Op. No. JC-0392 (2001) (concerning creation of an ESD in Llano 

County). Many voters have stated that they would vote for an ESD funded with a one cent sales and 

use tax because everyone pays it, unlike an ad valorem tax paid only by property owners. See 

Request Letter, supra note 1, at 1. You also state that Llano County citizens have considered 

adopting a county health services sales and use tax under Tax Code chapter 324, and you ask 

whether the county may do so. See id. at 2. 

We first address the creation of an ESD. The Llano County Commissioners Court wishes 

to call an election with a petition that includes the following wording: 

The ESD will provide for emergency medical service within the 

district. The district is to be created and is to operate under Article 

III, Section 48-e, Texas Constitution with a levy on the ad valorem 

property situated in said district not to exceed zero cents (0) on the 

One Hundred Dollars ($100) valuation for the support thereof; 

provided that no tax shall be levied in support of said district until 

approved by vote ofthe qualified voters residing herein. Said district 

is to be created and is to operate under the adoption of a not to exceed 

one cent (1) sales and use tax. 

Id. Accordingly, you ask whether the commissioners court may call an election to create an 

emergency services district and at the same time call an election for a sales and use tax not to exceed 

one percent in the emergency service district boundaries. See id. at 1. 

‘Letter from Honorable Cheryl1 Mabray, Llano County Attorney, to Honorable Greg Abbott, Texas Attorney 

General (Mar. 1,2004) (on file with the Opinion Committee, also available at hnp://www.oag.state.tx.us) [hereinafter 

Request Letter]. 
The Honorable Cheryl1 Mabray - Page 2 (GA-0242) 

Texas Constitution article III, section 48-e, provides for establishing ESDs as follows: 

Laws may be enacted to provide for the establishment and 

creation of special districts to provide emergency services and to 

authorize the commissioners courts ofparticipating counties to levy 

a tax on the ad valorem property situated in said districts not to 

exceed Ten Cents (106) on the One Hundred Dollars ($100.00) 

valuation for the support thereof; provided that no tax shall be levied 

in support of said districts until approved by a vote of the qualified 

voters residing therein. Such a district may provide emergency 

medical services, emergency ambulance services, rural tire prevention 

and control services, or other emergency services authorized by the 

Legislature. 

TEX. CONST. art. III, 5 48-e (added Nov. 3,1987; amended Nov. 2,1999). Pursuant to section 48-e, 

the legislature adopted Health and Safety Code chapter 776, authorizing the creation of ESDs in 

counties with a population of 125,000 or less. See TEX. HEALTH & SAFETY CODE ANN. 5 776.003 

(Vernon 2003); see also id. ch. 775 (Vernon 2003 & Supp. 2004) (authorizing the creation of 

ESDs without a population restriction). Llano County has a population of approximately 17,500 

persons. See Request Letter, supra note 1, at 1.’ 

To create an ESD located wholly within Llano County pursuant to chapter 776, “a petition 

signed by at least 100 qualified voters who own taxable real property in the proposed district must 

be filed with the county judge.” See TEX. HEALTH & SAFETY CODE ANN. 5 776.01 l(a) (Vernon 

2003). The petition must show “that the district is to be created and is to operate under Article III, 

Section 48-e,” the proposed district’s name and boundaries, the services it will provide, that its 

creation complies with Health and Safety Code section 776.021, which pertains to overlapping 

districts, and certain information pertaining to the petitioners. Id. 5 776.013. After the countyjudge 

receives the petition and tiles it with the county clerk, the commissioners court schedules a hearing 

to consider the petition. See id. 5 776.015(a)-(b). 

Notice of the hearing must state, among other things, that the district is to be created and 

operate under Texas Constitution article III, section 48-e, the name of the proposed district, and its 

boundaries and functions. See id. § 776.015(c). At the hearing, the commissioners court “shall 

consider the petition and each issue relating to the creation of the district,” and any interested person 

may appear “to support or oppose creation ofthe district.” Id. 5 776.016(a)-(b). “If after the hearing 

the commissioners court finds that the proposed district is feasible, will benefit the territory in the 

district, will secure the public safety, welfare, and convenience, and will aid in conserving the real 

property or natural resources . , the commissioners court shall grant the petition and fix the 

district’s boundaries.” Id. 8 776.017(a). On granting a petition, the commissioners court “shall order 

an election to confirm the district’s creation and authorize the levy of a tax not to exceed the rate 

allowed by Section 48-e, Article III, Texas Constitution.” Id. 776.019(a). “If a majority of the votes 

‘See U.S. Census Bureau, Texas QuickFacts Llano County, nvailoble at http://quickfacts.census.gov/qfd/states 

/48/48299.html (visited July 29, 2004). 
The Honorable Cheryl1 Mabray - Page 3 (GA-0242) 

cast in the election favor confirmation, the district is created.” Id. 776.020(a). The commissioners 

court of a county in which a single-county district is located appoints a five-member board of 

emergency commissioners to serve as the district’s governing body. See id. 5 776.033(a) (Vernon 

Supp. 2004). 

Attorney General Opinion JM-1010 addressed legislation implementing Texas Constitution 

article III, section 48-e. The commissioners court, acting under the predecessor of Health and Safety 

Code chapter 775, wished to limit the tax to be levied in support of an ESD to a maximum rate of 

six cents per $100 valuation and to provide for that amount in the election order. See Tex. Att’y 

Gen. Op. No. JM-1010 (1989) at 1 (addressing former article 235la-8, Revised Civil Statutes). The 

statute stated that “the commissioners court shall call an election to confirm the organization and 

authorize the levy of an ad valorem tax in an amount not to exceed ten cents on the $100 valuation.” 

See Act ofMay 22, 1987,7Oth Leg., R.S., ch. 673, 5 8, 1987 Tex. Gen. Laws 2495,2496 (formerly 

codified as section 8, article 2351a-8, Revised Civil Statutes). Opinion JM-1010 found the statute 

to be ambiguous as to whether it required the election order to include the maximum constitutional 

rate often cents on the $100 valuation or allowed the commissioners court to set a lower maximum 

tax rate in the election order. See Tex. Att’y Gen. Op. No. JM-1010 (1989) at 3. AAer reviewing 

the relevant provisions in context, the opinion concluded that the statute did not allow the 

commissioners court any discretion as to the maximum tax rate and the election order must track the 

statutory language as to tax rate. See id. at 4. Attorney General Opinion JC-0392 also concluded 

that an election order to establish an ESD must strictly conform to statutory language stating the tax 

rate. See Tex. Att’y Gen. Op. No. JC-0392 at 4 (construing a prior version of Health and Safety 

Code section 776.019). More importantly, opinion K-0392 determined that article III, section 48-e 

did not bar the legislature from adopting statutes authorizing the levy of a tax less than ten cents on 

the $100. See id. at 5. 

Amendments to chapter776 that became effective following the issuance ofopinion JC-0392 

allow the commissioners court to set the maximum property tax rate for an ESD at less than ten cents 

per $100 valuation. See Act ofMay28,2001,77th Leg., R.S., ch.1140, 5 6,200l Tex. Gen. Laws 

2542, 2543-44. Section 776.019(a) was amended to provide as follows: “On the granting of a 

petition, the commissioners court shall order an election to confirm the district’s creation and 

authorize the levy of a tax not to exceed the rate allowed by Section 48-e, Article ZZZ, Texas 

Constitution.” TEX. HEALTH & SAFETY CODE ANN. 5 776.019(a) (Vernon 2003) (adopted by Act 

of May 28,2001, 77th Leg., R.S., ch.1140, 5 6, 2001 Tex. Gen. Laws 2542,2544) (language of 

amendment emphasized). 

Although the amendment to section 776.019(a) does not expressly state that the election 

order may authorize a maximum tax rate of less than ten cents on the $100 property valuation, the 

legislative history is explicit on this point. A bill analysis states that the 2001 enactment amends the 

Health and Safety Code to provide that the tax rate of an ESD “is any rate allowed by the Texas 

Constitution.” HOUSE COMM. ON COUNTY AFFAIRS, BILL ANALYSIS, Tex. H.B. 2744, 77th Leg., 

R.S. (2001). Moreover, the same 2001 enactment included another provision regarding the 

maximum tax rate for an ESD. Section 776.0755 provides as follows: 
The Honorable Cheryl1 Mabray - Page 4 (GA-0242) 

Aboard [ofemergencycommissioners]3mayorderanelection 

to increase the maximum tax rate of the district to any rate at or below 

the rate allowed by Section 48-e, article III, Texas Constitution. The 

proposition on the ballot must state the proposed maximum tax rate 

to be authorized at the election. 

TEX.HEALTH&SAFETYCODEANN. 3 776.0755(a) (Vemon2003)(adoptedbyActofMay28,2001, 

77th Leg., R.S., ch.1140, § 6,200l Tex. Gen. Laws 2542,2544). This provision must mean that an 

ESD may be created with a maximum property tax rate of less than ten cents on the $100 valuation. 

Otherwise, the ESD board could not possibly seek to increase the maximum tax rate and the above 

provision would be meaningless. See TEX. GOV’T CODE ANN. 5 311.021(2) (Vernon 1998) 

(presumption that the entire statute is intended to be effective). The commissioners court’s election 

order may authorize a maximum property tax rate at any rate up to and including the ten cents on 

$100 valuation allowed by article III, section 48-e. Of course, once an ESD is established, it may 

tax in any year at less than the maximum rate that it has adopted. See Tex. Att’y Gen. Op. No. JM1010 at 5; see also TEX. HEALTH & SAFETY CODE ANN. $776.075(a) (Vernon 2003) (board shall 

annually impose an ad valorem tax on real and personal property in the district for the district’s 

support and the purposes of chapter 776). 

A tax rate of zero is not unprecedented. See N. Shore MRZ Ctr. v. Ill. Dep ‘t of Revenue, 723 

N.E.2d 726, 728 (Ill. App. Ct. 1999) (zero percent tax rate for certain goods provided by statute); 

Op. MO. Att’y Gen. No. 69-2004 (ambulance district set its property tax rate at zero in shifting to 

support by sales tax). We assume that the newly created ESD will not have any bonded indebtedness 

or obligations to third parties that will be jeopardized by the absence of any property tax support. 

However, the commissioners court is not authorized to call an election to adopt a sales tax 

to support an ESD. No sales and use tax may be adopted until after a district has been confirmed 

and the commissioners court has appointed its board. See TEX. HEALTH & SAFETY CODE ANN. 

§ 776.033(a) (Vernon Supp. 2004). “A district may adopt a sales and use tax . at an election 

held as provided by Section 776.0752.” Id. 5 776,0751(a) (V emon 2003) (emphasis added). “An 

election [to adopt a sales and use tax] is called by the adoption of a resolution by the board.” Id. 

5 776.0752(b) (emphasis added). At the election, the ballot shall permit voting “for or against the 

proposition: ‘The adoption of a local sales and use tax in (name of district) at the rate of (proposed 

tax rate) percent.“’ Id. 5 776.0752(c). 

We conclude in answer to your question that the commissioners court may not order an 

election to create an emergency service district and at the same time impose a sales and use tax 

within the proposed district’s boundaries. If the election order sets the maximum property tax rate 

at zero, the board is unlikely to have the funds necessary to pay board members’ expenses or the 

expenses of an election to adopt a sales and use tax. But see id. § 776.031(5) (district may accept 

and receive donations). Thus, while there may not be a legal impediment against setting the tax rate 

at zero, it may be impossible as a practical matter to establish an ESD with a zero tax rate. 

“‘Board”meanstheboardofemergencycommissioners. S~~TD(.HEALTH&SAFE~CODEANN. ~776.001(1) 

(Vemon2003). 
The Honorable Cheryl1 Mabray - Page 5 (GA-0242) 

You also ask whether Llano County may adopt a sales and use tax under Tax Code chapter 

324, which authorizes a county with a population of 50,000 or less to adopt a one-half percent sales 

and use tax to provide health services in the county. See Request Letter, supra note 1, at 2; TEX. 

TAXCODEANN. $4 324.021-.022, .081 (Vernon2002) (tax shall beadoptedorabolishedbyelection 

in the county). A county may not adopt the sales and use tax if as a result “the combined rate of all 

sales and use taxes imposed by the county and other political subdivisions having territory in the 

county would exceed two percent at any location in the county.” TEX. TAX CODE ANN. § 324.021(b) 

(Vernon 2002) (emphasis added). You state that the one-half percent tax rate authorized by Tax 

Code chapter 324 combined with the rate of sales and use taxes established in the City of Llano 

would exceed a two percent tax rate within the city. See Request Letter, supra note 1, at 2. 

Chapter 324 requires the sales and use tax to be established throughout the county. It must 

be approved “at an election held in the county,” and the ballot shall permit adopting a “local sales 

and use tax in (name of county).” TEX. TAX CODE ANN. 5s 324.021(a), .061(b) (Vernon 2002). 

These chapter 324 provisions may be contrasted with Health and Safety Code section 776.013(3), 

which requires the petition to establish an ESD to describe the “proposed district’s boundaries as 

designated by metes and bounds or other sufficient legal description,” and section 776.020(d), 

requiring the commissioners courts’ order recognizing the ESD’s creation to “insert description [of 

district] unless the district is countywide.” TEX. HEALTH & SAFETY CODE ANN. §§ 776.013(3), 

.020(d) (Vernon 2003). Nothing in chapter 324 provides for establishing the sales and use tax in an 

area less than the entire county. Llano Countymaynot adopt the sales and use tax authorized by Tax 

Code chapter 324 if that tax, when combined with the rate of sales and use taxes imposed by the 

county and other political subdivisions having territory in the county, would exceed two percent 

anywhere in the county. See TEX. TAX CODE ANN. 5 324.021(b) (Vernon 2002). See generally 

Fitzgerald v. Advanced Spine Fixation Sys., Inc., 996 S.W.2d 864, 865-66 (Tex. 1999) (court 

construes a statute by looking to the plain meaning of its language). If the one-half percent tax rate 

authorized by Tax Code chapter 324 combined with the rate of sales and use taxes established in the 

City of Llano would exceed a two percent tax rate within the city, Llano County may not adopt the 

sales and use tax authorized by chapter 324. 
The Honorable Cheryl1 Mabray - Page 6 (GA-0242) 

SUMMARY 

Health and Safety Code chapter 776 does not authorize a 

commissioners court to call an election to create an emergency 

service district and at the same time call for an election for a sales and 

use tax in the emergency service district boundaries. The election 

order must provide for an election to confirm the district’s creation 

and authorize the levy of a property tax, setting the maximum tax rate 

at any rate that does not exceed the ten cents on the $100 valuation 

allowed by Texas Constitution article III, section 48-e. Only the 

district board may call an election to adopt a sales and use tax. 

Tax Code chapter 324 provides for a county-wide sales and 

use tax to fund county health services. A county may not adopt the 

chapter 324 tax if the tax rate authorized by that chapter combined 

with the rate of all sales and use taxes imposed in any city within the 

county exceeds two percent in that city. 

Very truly yours, 

Attorney General of Texas 

BARRY R. MCBEE 

First Assistant Attorney General 

DON R. WILLETT 

Deputy Attorney General for Legal Counsel 

NANCY S. FULLER 

Chair, Opinion Committee 

Susan L. Garrison 

Assistant Attorney General, Opinion Committee