THE ATTORNEY GENERAL 

OF TEXAS 

.nm MAnox August 29, 1988 

ATMRNEY OENERAL 

Honorable W. S. McBeath 

Administrator 

Opinion No. JR-948 

Texas Alcoholic Beverage Commission Re: Authority of the 

P. 0. Box 13127, Capitol Station Alcoholic Beverage ComAustin, Texas 78711 mission to prorate club 

membership for purposes 

of determining permit 

fees for a private club 

registration permit 

(RQ-1432) 

Dear Mr. McBeath: 

Your request letter describes the along-standing 

practice of the Alcoholic Beverage Commission of 

"prorat[ing] each member's membership for that portion of 

the year during which he or she was a member" for purposes 

of calculating the permit fee due from private clubs ~issued 

permits under chapter 32 of the Alcoholic Beverage Code. 

you ask whether the Commission is "presently authorized or 

required to continue" this practice. 

Section 32.02 of the Alcoholic Beverage Code provides 

in part: 

. 

(b) The permit fee shall be based on the 

hiuhest number f m mbers in good standing 

during the year Tar zhich permit fee is to be 

paid according to the following rates: 

0 to 250--$ 750 651 to 750--82,250 

251 to 350--$1,050 751 to 850--$2,550 

351 to 450--$1,350 051 to 950--$2,850 

451 to 550--$1,650 951 to l,OOO--$3,000 

551 to 650--$1,950 Over l,OOO--$3 per member. 

(c) All fees collected pursuant to this 

section shall be deposited in the general 

revenue fund. 

p. 4784 
Honorable W. S. McSeath - Page 2 LX-9481 

(d) No later than 90 days before the 

expiration of the year for which the permit 

fee is paid, the permit holder may submit an 

amended application with as much additional 

fee as is required under the amended return. 

(Emphasis added.) 

The commission's request as to the propriety of continuing its practice of prorating membership for determining 

permit fees was apparently prompted by arguments of persons 

in the State Auditor's office that permit fees should be 

based on the hiahe t n mber 

pursuant to subsectik (E) 

of members during the year 

of section 32.02, and not on a 

DrOrated UM3mberShi.D ficure, the latter method possibly 

resulting in a loss-of rG venue legally due to the state from 

the permitting process. 

its request letter has advanced 

its continuing the proration of 

calculation, which arguments we 

The commission in 

arguments in support of 

membership method of fee 

summarize as follows: 

Prior to 1971, and prior to the codification in 1977 of 

the Alcoholic Beverage Coded,. the Texas Liquor Control Act 

provided that permits of the sort issued to private clubs 

expired on the next August 31 following the dates of 

issuance. Penal Code art. 666-13(a), (repealed); art. 

666-15e(6), (repealed). At that time, article 666-15(b) 

provided that if a fee was %ollected for a portion of the 

year" . . . "only the proportionate part of the fee levied 

for such permit shall be collected.*q Also, article 666-15e, 

applying specifically to private club permits, required 

proration of private club permit fees pursuant to article 

666-15(b). 

In 1971, article 666-13(a) was amended to provide that 

all permits expired one year from the date of issuance. 

Acts 1971, 62d Leg., ch. 65, 5 7, at 686. But the proration 

provisions of articles 666-15(b) and 666-15e, cited above, 

were not amended or repealed at that time. 

In 1977, the provisions of the Texas Liquor Control Act 

were repealed and many of its provisions codified as the 

Alcoholic Beverage Code. Acts 1977, 65th Leg., ch. 194. 

The provision that all permits expire one year from the date 

of issuance became, at that time, section 11.09 of the 

Alcoholic Beverage Code. The' proration provisions of former 

articles 666-15(b) and 666-15e were, however, omitted from 

the new code. The revisor's note, appearing after section 

11.71 of the Alcoholic Beverage Code, states that the 

p. 4785 
Honorable W. S. McBeath - Page 3 (JM-948) 

proration provisions were omitted in the code because the 

1971 amendment providing that permits expire one year from 

the date of issuance made the proration provisions obsolete. 

The commission argues that "since 1962, some nine years 

prior to the 1971 amendments and fifteen years before the 

codification of the Texas Alcoholic Beverage Code," it has 

followed the practice of prorating memberships for fee 

determination purposes. It argues, in effect, that the 

proration provisions, which were not repealed until 1977 

with the adoption of the Alcoholic Beverage Code, have authorized its practice of prorating membership and that since 

those provisions were *'substantive," their omission from the 

Alcoholic Beverage Code was due to an error of the revisors. 

In light of provisions in the code, in the act adopting it, 

and in the Government Code, to the effect that the Alcoholic 

Beverage Code was only non-substantive revision of prior 

law, the commission argues, in effect, that the proration 

provisions, being substantive, constitute still subsisting 

law authorizing the commission*s membership proration 

practice. See, Alto. Bev. Code 5 1.01(a); Acts 1977, 65th 

Leg., ch. 194, 5 7, at 558; Gov't Code g 323.007(b). The 

commission also argues that the long-standing practice of 

the commission, based on its construction of the provisions 

discussed above, supports such construction, particularly in 

view of the non-intervention of the legislature over that 

time, citing, inter alia Stenhens COUntv v. Hefner, 

Tex. 397, 

adopted).1 

16 S.W.2d 804'(Tex. 

118 

Comm'n App. 1929, opinion 

We disagree with the commission's position. "The rule 

that a departmental ruling adhered to through years of 

administering a statute will be given weight, only applies 

to statutes of doubtful construction.l' ~A11 

Associated Retail Credit Men of Austin, 41 S.W.!d 45Um(Tez: 

Comm'n App. 1931). We do not find that the provisions 

governing calculation of club membership for purposes of 

assessing a permit fee have ever supported the construction 

placed on them by the commission in adopting its proration 

method of calculating the number of members, and thus, the 

amount due for the permit fee. 

1. The commission notes that separate substantive 

amendments to the Liquor Control Act in 1977 left the 

proration provisions unchanged. Acts 1977, 65th Leg., ch. 

453. 

p. 4786 
Honorable W. S. McBeath - Page 4 (JX-948) 

The provisions for issuance of private club permits 

were first adopted in 1961, and that legislation made the 

substantially identical provision, that calculation of the 

fee is based on "the highest number of members in good 

standing during the year," as is currently made in section 

32.02 of the Alcoholic Beverage Code. Acts 1961, 57th Leg., 

ch. 262, § 1, at 560. We believe that even in 1961, when 

the proration provision of repealed article 666-15(b) was in 

effect, the proration provision had no applicability to the 

calculation of a club's membership. Article 666-15(b) on 

its face provided only for proration of the fee where a fee 

was collected for a portion of a year. We believe the 

commission's adoption of a practice in 1962 of proratina the 

nEmberShiD was unwarranted by any logical reading of the 

controlling provisions, particularly since the provision 

which is now section 32.02 cf the code has provided since 

its inception in 1961 that the fee "shall be based on the 

hiahest number of members." 

We do concede that not all of the provisions of the 

Alcoholic Beverage Code are models of clarity. Section 

32.16 provides, for example: 

No private club registration permittee may 

allow its averaae membership to exceed that 

authorized by its permit. (Emphasis added.) 

It would appear somewhat anomalous to have provided in 

section 32.02 that the permit fee is based on the hiahest 

number of members, but in section 32.16 that a permittee may 

not allow its averaae membership to exceed that authorized 

by the permit. However, section 32.16 is not applicable to 

the fee calculation under section 32.02. It appears, rather, to operate in conjunction with section 32.17, subsection 

(a)(S), which provides that a permit may be cancelled or 

suspended on a finding that the permittee club has violated 

any provision of the code. EiSSalso section 1.05 of the 

code providing criminal penalties for a violation of a provision of the code.) 

We also concede that the fee assessment provisions 

themselves present certain administrative difficulties for 

the commission.. Subsection (b) of section 32.02 indicates 

on its face that "[t]he permit fee shall be based on the 

hiahest number of members in good standing during the year 

for which the permit fee is to be paid." A permit expires 

one year after the date it issued. Alto. Bev. Code 5 11.09. 

However, since the fee is payable in advance at the time of 

the application for a permit or renewal permit (section 

11.35), the calculation of the fee "based on the highest 

p. 4787 
, 

Honorable W. S. McBeath - Page 5 (JM-948) 

number of members . . . during the year for which the permit 

fee is to be paid" is necessarily only an estimate. 

Subsection (d) of section 32.02, providing for "amended 

applications" no later than ninety days before a permit's 

expiration, somewhat but not entirely mitigates the problem 

of assessing a fee based on the highest number of members 

during the year since the membership cannot be ascertained 

with certainty until the nn8 of the year in question. The 

commission has informed us that it has found the subsection 

(d) amendment procedure insufficient for determining actual 

amounts due on permit fees under subsection (a), because the 

membership might change after submission of the amended 

application, and because the procedure led to frequent 

overpayment of fees. Amounts overpaid, once deposited in 

the general revenue fund, could not be reimbursed without 

legislative action. Tex. Const. art. VIII, 9 6. Similar 

administrative problems exist under the present procedure. 

The commission informs us that, instead of following 

the subsection (d) amendment procedure, it has relied on 

routine audits of licensees once accurate membership figures 

are available at the end of the permit year. However, the 

method of calculation used, even in such audits, for 

determining club membership for purposes of fee assessment 

has apparently been the membership proration method referred 

to above rather than one determining the hiahest number of 

members during the year pursuant to the language in 

subsection (b).2 

But again, even granting that the fee assessment 

provisions present administrative difficulties, we do not 

believe that those provisions are or have been ambiguous 

such that the board was warranted in construing the 

requirement of section 32.02(b), that the fee "shall be 

based on the highest number of members," as authority to 

base the fee determination on a prorated membership figure. 

2. Please note that we do not address, because you do 

not raise, any issues with respect to the operation of the 

amendment procedure provided for in subsection (d) of 

section 32.02 or with respect to the commission's practice 

of determining additional fees due by use of a routine audit 

rather than the amendment procedure. 

~7.4788 
Honorable W. S. McBeath - Page 6 (JM-948) 

.-, 

SUMMARY 

The Alcoholic Beverage Commission is not 

authorized to prorate private club membership 

for purposes of determining the permit fee 

under Alcoholic Beverage Code section 32.02. 

Under section 32.02, the permit fee is based 

on the hj,g&& number of members in good 

standing during the year for which the permit 

fee is to be paid, rather than on a prorated 

membership figure. . 

JIM MATTOX 

Attorney General of Texas 

MARY KELLER 

First Assistant Attorney General 

LCUMCCREARY 

Executive Assistant Attorney General 

JUDGE ZOLLIE STEAELBY 

Special Assistant Attorney General 

RICK GILPIN 

Chairman, Opinion Committee 

Prepared by William Walker 

Assistant Attorney General 

p. 4789