**OFFICE OF**  **THE ATTORNEY**  **GENERAL OF**  **TEXA8 AUSTIN** 

**Dear Kr.**  **Bhepparbr**

genoy Hprlinee, IZIO. may smplo~ euoh oontraotorsand snginesrs and **enter** into ruoh agrmment ritb then a~ It daema advisable,

._,. - . ..__ ._ ~..Hon. Wo. H. Sheppard,Page X

ia thr name of the Defonrr Plant Corporation, ald paroham maohlnery ana **rquipmmt nror8rar~**  for the projrot,rubJeot to thr written approvalor thr Derenrr Plant Oorporation.

IB all 

### or itr 6p8ratloeruearr l uoh oontraot,the morgreo I PlpwlSnrr,xno. rot8 aa 

### l goet ror the Dofoe8o Plant Oorporrt on, The DOrOB OOrpWatloe 16a8.8 rOtOr tehiol88, rhioh are ured b thr Ourgrnoy Plprliwr, Ino., aed orrtde ooetraotorror tI ruoh pi 8 Dei8e80 corporation $n **the** oonrtmotloe of the pub lo highway8 Of the 8tato of T8x.a~. Othrrmotor wr llne8. Bone or the80 leaed retdolorarr a804 upon hlolea are leawl by oontraotorrfrom their mar8 aed 8ro used la the ooertruotlon work, but thr Mien88 Corporation rrlmbureerruoh oontraotorrfor the rentalspaid br them,

YOU NqU88t Our OplZllOB UpOB the iOmwing paertlonrt

1. .X8thr Dbfsnre

### Plant oorparatlonllablr to the Btatr ot Texar **for** th8 tar lmpored **upon** motor fu81 ured upon th8 pub110 hlghwryror thlr State in rehioler leased **br** it and used by the ltmrgeno~Pipeliner,Ino. and its other oontraotorr in the ooerttuotlonof it8 pipeliner?
t. 18 thr lhergeno). Plp8llne8, Ino. llablo to thr Btate of T8xas for thb **u8e** tax Imposedupon motor rue1 seed upon the pub110 highway8 0r thir state le rehlolrr leame& by .theDsf8e8ePlant corporation ae4 ored by the lmrgenor Plprllnsr,Ieo. urd thr Dotoe **Plant** Oorporstlon*roontnoton in thr ooertruotlon of rpoh ~l~rllerr? 31. Are the oontnotor8 llrblr to thr State of Toxas for thr ne.0 tar lapore& upon motor rue1 u8e6 apoe the pabllohighway8 oi thlr Stat6 in tehioler lsaesb by them troa third personaand used la th8 oonrtruotlonot th8 plpslleerfor the Defense Plant Corporation, whgre suoh oorporation relmbur888suoh oontraotor8 for rdntal8 pai& the owner8 of ruoh Tehlolrr? 

## .- 562Roe. 000. H. Sheppard,Page 3

ne enswer **your** rlrat queetlon,**no.** The 

### D~fOXiBO

Plant Corporation**was** organizedunder Seetim BObb, **Title** 15 U. 8. 0. A. The purpore **(am** rtated In thr **AOt) want**  "In oraer to aid tha aorernment or 

### the Welt06 State.8

ia it8 national det~ero progran . , .* 6eotioe 610 ex roaaly prortded that auoh Oorporetionshouldbo exempt from aP1 8eht8, Poe, storage,end purohaae terra impo88d by the United Hater, **or** by any state, County munio~pallty,or looel taring euthorlty. Real propert of ihe Corporationwan medo rubfeot to State, County,munloi 1, or looal taxation *to the **84m4** oxtent eooording to ite clue am other net prok perty In taxed,*

A6iaO from this expre88 aongre88lonelexempting from taxation,we 6,re of the opinion that the Dersnee Plant Corporationwould have the same 8xemptionupon thr dootrine 0r implied **DOUBtitUtiOU4l ’** **l~U4~t~** of the Federal GoverrnWnt **end** it8 inetrumentelitles from state taxation, )LoGullooh V. Caryland, 4 meet, 318, 4 U. 6. (L. Ed.) 679; 26 R.C.L. 95.

The legal lnoiaenos of **our** motor fuel tar 18 upon the ultimate user or oonaumer or the motor fuel for the propulsion of motor vehiOl88upon the highway8 or the state ot Texae, end not upon the seller or vendor of **motor** fuel: Artlole 7065b-z(e)

v. A. c. s. seotlon e(a) protlaee: 

### "Ko **tax** 

### Oha11bs lmpoeeb upon the mati,
**use,** or dirtribution

### or any motor luel, the 

### 1lEpO81S@

or whloh would oonetitu *an UIllEWtul burden on interstate oomneroeahd whioh q 

### 18 not rubjzot to **be** taxrd under the Cmtution of th 5% t f Texas and the Unltsa ~teteBl' (~;h:8f8°0Ur8). fn Faders1 Land Be& Of Sifti&:'t?;ll v. Binmark Lumber 

### co., 314 u. S. 95, fj6 L. Ea. 

### 65, tbs court eala:

"The FederalGoVerW&f le oiie:i3 delegated
powers, end from that lt neoerearilyfOllOW8 that any oon8tftuti0nal ererol8e or Its delegated**power8**

### 564

**XOn. 0.0.**  **I?.** shoppmd, **PIgO (1** 

**18 (OVeFll@4Bt41**  **, .**  **. .**  **It 4180**  iO11OwB thd rh8a C)04n00 ooa8tltutloMlly orrat I oororation throa& whloh tha Fodrral **Gmornmoat** L stulll **8Ot8,** the **rOtiVitl.8 Of**  8uOh OOrpOrrtioa era ~orrrrrmtal~

. . .* And La Pittma v. Uoma Owner8~ Loan Corporatloe 308 0. 9. r1 84 t. u. 11, 60 S. ct. 15, lE4 A. L. R. lE&, the Court uidr

**“ CO** **2 MOB**  **b48 XbOt**  l oorporaloa to h8Ui the porot to **or~ato** thr poriozaaaorOS ~otwamatel funotioaa,but bra the teet the **operebtonr** Ohuavalidly **aat Ii** owor to pro**erird. ‘** **A** pwar to onrtr~lnplie8 l p ower to ~iteBWV@.' Wcullooh r:xerPlead, rupn (4 sheet. p. 4~4, 4 L. M. 11~ ecuaa d Thla power to promerr aeo~aaarhln thr range of thr l xp rerr

pow0 OOBfO~Od

up on OOlyr88s

t0 aakr l U 14W8,wbieh ahall he aw*rrry ead promr ror orrrylag lnb l **xmoutioa** all pawn rented br the Conrtltutloe la thr Oorarnaeator the United Staten. aonet. Art. 1 8.8. 8 powor 40 protroi In thr exrrolw OS thlr

ihi iawfal l

otlrltlerof lta

**Con@ ‘** **888 h48**  th8 pt%Mr to "protidr**iOr** the OodvDoD bsfWU0

**. .**  **.** di tha **vBit.6** StatW.* **COllBt, hart.**  **1, 8.0.**  **8,** It **in** l

**ubaitt~d** that **thla** tunotloe $a~ gownmoatal. The Fedora1 GOVlrnDsPt hAb OhO84n t0 $WiOm thlr **fUBOtiO;B&i** ;;;Bt prrtlellfthrough the miO?IB~ Plant CW'pOrEtiWh w pOrtlOB 8l

OtiViti@B **WBt b0**  **r4gBrdOd 44**  ~OTOPtWBt8l, **tad antitbd**  **to i&iUBity**  rr0t8 8teta texatloa.

to tax 11 duo upon 4 8414 0r motor 

### rba to the Derrnrr Flant Gorporetlon. The purohedsrOf mOtW fuel **by** thr **tarr~r~oy** Plprllner,Ieo. 18 ln 108 oepeolt 88 agoat tar thr mr0tt8s Plant C.orporetloa. Thr notor **r401** I: **8** 4oturllPpi6*-

tw red ir thr property ottb Detinro 

### Plant Corporation,

Ph. trot thet it allow thir 6arollnr to bo ared la lamed rrhlolrr upon the hhhuayo ot the Stat, ot T~xar by tb zBor&onoyP1Qa1ixlb8, III@, and 1tr other Qontt~Otor$La th Wnrtrrletion ot thrro ~lpoliaw doer not a&e it liable tar the a80 tax brorurr It lr rtlll 

### dleahrrgl~ ltr Federal 

### flln0t10na. He mawe* your seoond 

### qwiotlon, no. sin00 tb 

### was trrrgrnor klpelinrr, Ino. 1s rotlng 41 an went tor the DOten@@ Plrnt OOrporation ln all of it0 oporatlonr,u* are d the oplnlon that it ir sot llablr for tbr uno tar impor. tymgloc turl ared upon the gubllo highmy in the Gtatr

Thb motor ,turl b&a-s to the Detonsr 

### Corporation. It l\lrr&h.r 

### tha llmergonoy Fiprlirer Ino.utd lta other oontraotorr with motor rohlolrrtar 

## th.fr 08. in the oonrtruotlon or it0 plp4llnrr. 

### Glnor the uoa of ruah notor trht8ler br such 

### ooatraotorr 18 tar th0 8olr benoift 

### or the XhiWm 'Flat Corporotioa,*hiOh ir rxproo8ly ereapted from the payuent of mctor Sue1 tams, and lr ongaged in tha alecharge 0r a frdrml **tuDotlon,** wb do not think that cuoh oontraotorror0 liabletor the use tax.
PIa are unable to a8ver pur **third** quertionbsosum we do not bavr rutfloicmttaotn upc%i uh~loh to base **our opinion.**  **It** the leotur

ice1 lr rup lha

!. shoes@

oontractorr by the Duiwirr Flaarrt Oar oration unbar to ocmtraot, rnd no title to ruoh motcar

tuur P lwr vortr in thorr oontraotorb,tha we oan not 100 how the ooMzactora mad be limblo tar the payment of the motor ia*1 ta1. Cm thr otbsr head it therm oonthotorr twoharm tho **rotor** tuel **and t16e** **it upon**  **td** hi#l!wrrr et TBma Ia rrhlolrr leaad 

### from thir4 breonr then 

### va boltire that uoh oontraotore would bo lirblr tar Ihrmotor 

### iwlr tar rr6wilrre o? whothorthey two rolmbunod to? 

### the rantalr paid for 

### thsrr Trhloler or sot. PI ~111 be s$@d to &ire 7'00 l ROW detinitc, u11)u.r to thlr qurstion if you ail1 rupply II@ IPOM trots). Truding that the rbore fully anawl~r8 your :uotttlans, we are
Your8 tory truly