The Honorable Robert S. Calvert 

Comptroller of Public Accounts 

State Capitol 

Austin, Texas 78711 

Opinion NO. M- 228 

Re: Taxation for inheritance tax 

purposes of devise and bequest 

to the members of the Oak Hill 

Cemetery Endowment Fund Committee as a part of the Oak Hill 

Cemetery Endowment Fund under 

Dear Mr. Calvert: submitted facts. 

We quote the following from your letter requesting 

the opinion of this Office on the above captioned matter: 

"flhe decedent7 died testate . . . May 

11, 1956, and allzf the required reports 

under the Inheritance Tax Law have been made 

and filed with this Department. 

"Under the terms of the last will and 

testament of the deceased, a bequest of onefourth of the remainder of the estate was 

made 'to the then members of the Oak Hill 

Cemetery Endowment Fund Committee as a part 

of the Oak Hill Cemetery Endowment Fund,' 

of Flatonia, Fayette County, Texas, in the 

sum of approximately $35,000.00. 

II . . . We wish to be advised whether or 

not this bequest is exempt as provided under 

Article 14.015 of Chapter 14, Title 122A, 

Taxation-General. 

"We are furnishing you herewith the following pertinent papers for your use in this 

connection: 

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The Hon. Robert S. Calvert, page 2 (M-228) 

“1. Copy of the last will and testament 

of -fihe decedent7. 

"2 . Articles of Association - Oak Hill 

Cemetery Endowment Fund Committee. 

“3. Trust Indenture - Oak Hill Cemetery 

Endowment Fund Committee. 

"Brief - submitted by fihe attorney for 

the estatz7. . ." 

We have been advised of the following facts in the brief 

submitted by the attorney for the Oak Hill Cemetery Endowment 

Fund Committee, and further verification and history have been 

supplied by the Mayor of Flatonia and other interested citizens. 

The Oak Hill Cemetery is owned by the City of Flatonia, 

Texas, and is located within its city limits. Chapter IX of 

the Revised Ordinances for the Government of the City of 

Flatonia, Texas, was codified and adopted on October lath, 

1907, and provides, among other things, for the appointment of 

a sexton, sale of lots, burial and keeping of records. Article 137 of these Ordinances reads as follows: 

"Article 137. There shall be kept a 

separate account of all Moneys received 

from the sale of cemetery lots; ani the same 

shall be used only for the improvement and 

repairing of the City Cemetery." 

The funds realized from the sale of lots and local taxes 

were not sufficient to properly maintain the Cemetery. In 

order to assist the City in operating the Cemetery, the Oak 

Hill Endowment Fund Committee and the Oak Hill Cemetery Association were established on July 8, 1949. The Articles of Association of the Oak Hill Cemetery Endowment Fund Committee 

recites that seven named persons have associated themselves to 

form an Endowment Fund Committee. The purpose of the Association is to serve as trustee of such funds as may be donated 

or as may otherwise come into its possession in conformity with 

the purposes of any other trust agreement which may be entered 

into by the Committee and any other persons desiring to create 

a trust fund of not less than $500.00 for purposes pertaining 

to the Oak Hill Cemetery. 

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The Hon. Robert S. Calvert, page 3 (M-228) 

Provision is made for the filling of vacancies in 

membership of the Committee of the Association in order to 

provide that the Committee shall be self-perpetuating. 

The trust indenture executed by the Oak Hill Cemetery 

Association of Flatonia recites the granting and delivery of 

certain properties to the persons who compose the Oak Hill 

Cemetery Endowment Fund Committee, as trustees, for the 

purposes previously set out. The total at the time of axectiition was the amount of $3,95,0.00. 

Paragraph V declares the purpose of the trust which 

may be briefly summarized and quoted as follows: 

(1) The principal of the Endowment Fund is 

to be kept intact forever. 

"(2) So much of the income from such Oak 

Hill Cemetery Endowment Fund as may be necessary 

for such purpose shall annually be used by the 

trustees for the maintenance of the lots hereinafter enumerated'and specified, and for the 

upkeep and maintenance of such other lots as 

may hereafter be provided for by donations to 

the Oak Hill Cemetery Endowment Fund as hereinafter provided." 

(3) Any income from the Endowment Fund 

which is not expended for the purposes set out 

in paragraph (2) shall become a part of the 

corpus of the Oak Hill Cemetery Endowment Fund. 

"(4) It is contemplated that the trustees 

may annually pay over the income from the Oak 

Hill Cemetery Endowment Fund to the Oak Hill 

Cemetery Association and rely upon such association to maintain the lots for the maintenance 

of which this fund is created.” 

Paragraph VI sets out the specified lots for the maintanance of which the income from the Endowment is to be cxpended and enumerates on the official plat of said Cemetery each 

specified amount following the date of the donation, the donor's 

name and lot name and the plat number of the lot. 

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The Hon. Robert S. Calvert, page 4 (M-228) 

Paragraph IX provides that upon receipt of donations 

of not less than $100.00 the trustees shall include in the lots 

to be maintained out of the income of the Endowment Fund any 

half lot specified by the donor; and further that, upon receipt 

of donations in the amount of not less than $200.00, the 

trustees shall include the lots to be maintained out of the income from the Fund any full lot specified by the donor. 

Paragraph X reads as follows: 

"The oak Hill Cemetery Endowment Fund Committee, being the trustees herein, is a voluntary association of individuals for the purpose 

of serving as trustees under the provisions of 

this indenture, as well as to serve as trustees 

under other agreements relating to the Oak Hill 

Cemetery; and the Articles of Association of 

such Committee are attached hereto and made a 

part hereof as fully as though copied herein 

verbatim." 

Article 14.015, Ch..14, Title 122A, 20A, Tax.-Gen., 

V.A.T.S., enumerates the transfers which are exempt from inheritance taxes. If the devise and bequest here under consideration is to be exempt, it must come within the provisions 

of subdivision (3) of Article 14.015. This provision reads as 

follows: 

"Public Use. Property transferred to or 

for the use of this state or any town therein 

for public purposes." 

Although under the terms of the trust indenture the income from the trust fund is to be expended only for maintaining 

specified graves within the Cemetery rather than all graves within the Cemetery, we hold that since title to the Cemetery lots 

is vested in the City of Flatonia, the authorized expenditures 

are for a public purpose and do relieve the City of Flatonia 

of a duty and an obligation imposed by Article 137 of the City 

Ordinances. 

Subdivision (3), above quoted, has never before been 

construed since its enactment in 1965. Acts 59th Leg., Ch. 

402, p. 830. Clearly, the use of the income from the trust 

will be a use for the benefit of the City of Flatonia and 

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The Hon. Robert S. Calvert, page 5 (M-228) 

therefore a use for a public purpose. Thus, we conclude that 

the devise and bequest in question is exempt from inheritance 

taxes and you are accordingly so advised. This opinion is 

expressly limited to the facts presented and is not to be construed as applying generally to devises and bequests to nonprofit cemetery associations. 

SUMMARY 

Devise and bequest to the members of the Oak 

Hill Cemetery Endowment Fund Committee as a 

part of the Oak Hill Cemetery Endowment Fund 

is exempt from inheritance tax under the submitted facts. 

orney General of Texas 

Prepared by Marietta McGregor Payne 

Assistant Attorney General 

APPROVED: 

OPINION COMMITTEE 

Hawthorne Phillips, Chairman 

Kerns B. Taylor, Co-Chairman 

W. V. Geppert 

2. T. Fortescue III 

Richard Chote 

Jim Swearingen 

A. J. Carubbi, Jr. 

Executive Assistant Attorney General 

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