DAN MORALES

ATTORSEY GESERAL 

## QBffice

of tiy ~ttotnep General &dateof aexae July 12, 1993

HonorableLuis V. Saenz Cameroncounty District Attorney CameronCounty Courthouse 914 East Harrison Street Brownsville.

Texas 78520 Opinion No. DM-235
Re: Whether a delinquent tax penalty adopted by the Cameron County Commissioners

Court under section 33.07 of the Tax Code applies to delinquent taxes subject to insklbnent agreements entered into under section 33.02 of the Tax Code prior to July 1 of the year in whichthe taxes becamedelinquent (RQ-528)
Dear Mr. Saenz:
On behalf of the Tax Assessor-Collectorof Cameron County (the “tax assessorcokctor). you ask whether a delinquenttax penalty adopted by the Cameron County Ckxnmissioners

Court under section 33.07 of the Tax Code applies to delinquent taxes subject to instaUment

rgreanents entered into under section 33.02 of the Tax Code prior to July 1 of the year in whichthe taxes becamedelinquent. Subsection(c) of section 6.30 of the Tax Code au&or&s the goveming body of a taxing tit to contract with any competent attorney to represent the tmit to enforce the collection of delinquent taxes. Section 33.07 authotizes a taxing unit to providethat tsxeJthat~delinquentonJuly1oftheyecrrinwhichthey become delinquent incur an additional penalty to d&y costs of CdlWtiO~ifthCUIlit...bas cmtracted wlth an attorney pmuant to Section 6.30 ofthis code. The amount of the penaltymay not exceed 15 percent of the amount of taxes, penalty and interest due. You inform us that the Cameron County Commissioners CoUn has entered into an agreement with a law firmto collect delinquenttaxes in accordance with section 6.30, and has passed a resolution providingfor a 15 percent penslty on taxes that remain delinquent on July 1 of the year in which they become delinquentpursuant to section 33.07. **YOU** state that “[t]he compensation under the contract with the kw fbm is the 15% penalty ~lecl by Section 33.07 and required by the CommissionersCourt.” You ask whether

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~Sl~pacmtpenaltymayberawwArgaiaPtataxpclyawhohrr~~intom indbwnt apeanent with the taxing unit under section 33.02 prior to July 1 of the year inwhichtbetaxesbecmcdelinquent. ’ Section 33.02, which authorizes the cokctor for a taxing unit to mta an agmeant with a person for the payment of delinquenttaxes, penalties, and imerest in imtallments,provides in pertknt part:

(a) The collector fbr a taxing unit that cokts its own taxes mayenteranagreementwithapersonde&nquentinthepayomtof thelax,pendtieqandinterestininlrtalhnentr. Theagmemmtmust kiawriting~~ynotadmdforapaiodofmorrthan36 months. (b) Interest awrues as provided by Subsection (c) of Section 33.01ofthiswdeontheunpaidbalanceduringthepcriodofthe Igncment. (c) A property OWIEI’ S

execution of an b~al&nt agreement under this section is an irmwcable admissionof liabiity for all taxpenalties,and interest that are subjectto the agreement. (d) Propatymaynotbeseitedmd~ldMdaarit~ynotbe 81edto collect a delinquenttax subject to an bstalknt agreement2 lldeoEthCp~owner: (1) 5ilstomakeapaymentasrquiredbythergrramm; (2)failstopayotherpropertytaxesc4Alectedbytheunit whendueasmquiredbythe4kcto~or

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(3) breachesany other conditionofthe agreement,

. . Tax Code 0 33.02(a) - (d) (footnote added). The comptrolkr interprets section33.02 to allowa delinquenttaxpayer who enters into an insmllmentagreementto avoid the impositionof titrther penalties. A letter to the tax assessor-wllector fromthe officeofthe comptrollerstates in pertinentpart:

Subsection (b) [of section 33.021provides that interest accrues on the unpaid balance-the subsectiondoes not provide for penalties to accrueonthatbalance..

. . We have wnsistently interpreted Section 33.02(b) to allow a taxpayer to stop the impositionof penalties on

. delinquent taxes by enteting mto an insmlhnent agreement. Throughout the Tax Code, the Legislature specifies“interest”when it means interest and “penalties” when it means penalties. Further, we think the clear intent of Section33.02 was to allow a taxpayer to formally agree to pay delinquenttaxes and avoid the imposition of further penalties or a suit to wllect taxes-a taxpayer would have little or no incentive to enter into an insmlhnent agreement if penaltieswntinued to accrue or he wuld stillbe sued for wlkction. Uaderourimezpraation,atwpc?yacwldnotbe~leforthe 15 percent additionalpenaltyifhe enteredinto the instaumentagrmment before July 1. Section 33.02 does not permit penshies to accrue after the agreementis made and Section33.07 does not permitthe 15 percentadditionalpenaltytoattachuntUJuly1. Thishssbeenour wnsistent administrative

wnstruction of the law. Letter to Antonio Yzaguirre, Jr., Tw Assessor-Collector, Cameron County, from Ray Bonilla, General Counsel, Comptroller of Public Accounts, dated April 16, 1993 (emphasisin the originsl).
You disagree with the wmptroller’ s wnchrsion. You contend that the phrase

“taxes that remain delinquenton July 1 of the year in whichthey bewme delinquentincur an additional penalty” in section 33.07 refers to delinquenttaxes subject to an installment agreement. You base your contention on that fan that section 31.02(a), the provision which establishes the date upon which tsxes become delinquent, sets forth cettain exceptions, namely taxes paid under sections 31.02(b), 31.03 and 31.04, but does not except taxes subject to an installmentagreementunder section 33.02. We wncur with the wmptroUer’ s

interpretation of section 33.02, and tind your contentionunpemuasive.

p. 1219HonombleLadsV. Saenz - Page 4 (DM-235)

Fbst, we agree with the wmptrokr that it ia dkpoMve that section 33.02 acprrsslyprovidesthatimaenwntimreoto~eontheunpaidbalaaccbutdoesnot dmitrlyprovidethatpwelti~wiUwn&etoiccrw. Again,subaection(b)ofsection 33.02 states

that “[i]nrcrr.rr

accrues asprovided

by Subsection

(c) of Section

33.01 of this wdeonthetmpaidbalancedtuingthepekdoftheylrrsment: (Emphasisadded.) Subsection (b) does not provide that penalffes will wntinue to be imposed. Significantly, rcction33.01ppovidertorbathtbercaurlofintaat~theimporitiw0fpeaaltia. %bsection (a) of section 33.01, for example,provides:

Adelitquenttaxincucsrpenaltyofsixpercentoftheamountof the~forthe~crladumonShitirdelinqucntpl~onepaccllt foreachdditionalmonthorportionofamonththetaxrem8ins unpaid prior to July 1 of the yeu in which it bewmes delinquent. However,ataxdeUtquentonJuly1incursatotalpenaltyoftwelve percentoftbeamountoftbede&nquenttaxwitbout~tothe mmberoftnontbsthetahasbeatdeUnquent.

In~~webclim~itisinsieaificMtthlltpeaiw31.02(a)doesnotaccept instdment agreements. Section 31.02(a) establishesthe date upon which taxes become delinquent. It does not impose pen&k, nor do the provisions it excepts.) The imposition of penalties is speciiicallylddrrsred in sections 33.01.33.02, end 33.07. We w~withthecomprrolldsw~onthat~provirionsdoaot~aturingunit to impose

a penalty

adopted pursunt to section

33.07 on a taxpayer

wi20 has entered into

p. 1220HonorableLuisV. Saenz - Page 5 W-235)

mstabat agreemmt under section 33.02 prior to July 1 of the year in whichthe mes ikatne delinquent. ’
SUMMARY

A delinquenttax penalty adopted under section 33.07 of the Tax Code does not apply to delinquent taxes subject to &aliment agramam entered into under section 33.02 of the Tax Code prior toJuly1oftheyeuinwhichthetucesbecMledelinqumt.

DAN MORALES Attorney Oeneralof Texas
WJLLPRYOR FitSthSiStMtAttorlICyGenenl
MARYKELLER Deputy Attomey Oend for Litigation
RENBAHICK!J State Solicitor
MADELEINEB. JOHNSON Chair, Opiion Committee PreprredbyMaryR(-- Assistmt Attorney Ckaaal

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