OFFICE OF THE ATTORNEY GENERAL OF TEXAS

**AUSTIN**

HonorablaJ. Finer Pow.11 CountyAttornay Brown County Br~wnwood,Texas

Jhar sir1

Ka are SD noalpt raqueatin~ the opin101~ of t put 88 **roli0r8:**

tba ques$loq4vbetbar a bondholderfor inatansa for the payment of whoa8 bon6 a oertati Mr. he& bean laviad, OOuld 00mpal th8 hUfm& authority to devote the lntaraatand paalty to the payment of his bond; and ir: nO;.ca8e

a0 iu 88 my knowledgegoea, was the quu,atlon inYolY6d whether a taxpayer could o~pal awh 65.~p0cati0~ of the intare& and penaltjr iund. 1 m partfeularly anxious for your opinion on tbia 8apwt of tbs quaatlon."

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Eon. J. Plner 7owel1, Page 8

The g@n@r@l rub with rarerenoeto the disposition Of penaltiesand intorestis edited in Ooolay on Taxation, 4th Ed. Vol. 4, p. 3578, .TQO. 1821, aa &llma;

“F’enaltlea

lbr dallnquanttaxma gcmarally follow the tax ace 80 to the dl strict sntitiea to the tax, unless It ir otharwiaaprotIde by statute. Cn tbc 0tba.r hand, if tEt pbnaltIea
are ImPosadby the Leglalatum, thaiii- dlapo~ltlon routs In its dlaoretlon. Money lbriY.6 from RMaltisa and torfeiturea where taxes are dallyquent @I%?

not % part Of the tax, end tiara Irrpoaad by Fe Laglalaturait baa ,arf&t to dispoaa or PAah runda a# It llksm, ragardlaasot the purpose of the tax, as agalnat the objaotion that pub110 money relaeb.

for one purpoas cannot ba usrd for anothw.

. .”

p* lfN?B, Ths p*nera~sr~l~l~~elao stated in 61 Corpus Jurla

S*o. 2E50) :

*Unlessotharwlsa direoted, Intaraat,panaltlaa, and coats oolleotadon dalinquantturns rollow tba tax, end go to the atate, oountJ
or olty, l

ooordlnga8 tta one or tha othar is entitled to the tax Itaolf, end, In oaa~a wham two or more of thee8 two Inkr4stod in the tax, auob Interest szibnsnaltiea should be appcmtIonad esong them In the ratio of their roapaotire aharea or the tax, the foragolngbaing eometlmee provided for bg-

statute. But the ~~iU~P%lPO map ahange thin rule and diapoas otherwiar Of lntarrator penalties. A etatut. provldlng for the dletrlbution

ot Interest end penaltl88 601- leoted i:1

6 Biifartntainner from the 6lepoaItlon of the taxas on wbfoh the lntareatand Renaltier

are baaed does not umotlntto the Sppli~@tfO~ Of taxga to obJaots other than for wbiob tbY were i~p0s.d.

. .”

Artlo 7338, Revteed (~1~11 .Ydxte@, lO25, @@ amsndea, *ich p0rides ror penaltlaaend Intmaat on dallnquant taxes, reads in part aa followatrioon. J. Finer ?awtll, 2868 $j

*kll penaltiesand Intareatprov$ded~for 1~ ti:ic

.;ot stell, whtn colltotad, be ?eld m the state, counties,and dletriota, if any, In pro- .;;Ortion

to the tsxas upon vb,lch the pemlty and inttraatarc follaotad. All aisaountcprorldad fOT lo thic Act shell, a-bcn allowed, be ohargatj to the state, counties,end dlatricts,if ay, in proportionto thu tare% upon which such d;acountsnrt ellmad.*~

You state that you haYe been unable to rind any statute In Texas proYidIngfor the dlcpomltion or panaltiea end Intartatand we have bran unable to find a0y axeept that quoted above which epgllaaas between t!! Yarloua taxing authoritlbaand not rrprassly to the varlout funda of the county.

In tht oasa Of JOWE Ya. I'i~liaaa, 1El Tex. 94, 46 I'. X. (R8) 150 our %xprem Court held that p&tSlti~@ arid intaraat lra no part Of tht tax and tbt Le@lslatura therefore has autimlty to lsaka tiispoeltlon

ttereaf or to raleaao such peoaltleasnd interest. ft is suaaastaa that this holding affords t&m basis for strong argunmnt that, the taxlne,

authoritiesdo not neoaasarllybooa to plaoe the interartgid p~naltles in #a pertioularfund far which tha dellnc;wnt taxaa mra levied and asaa~aad~ We do not think, however, met this la the netural or proper rwult of auoh holding ainoa it la ar,

a~plioatIonof the ganaral rule that the Lagltlaturo

amy laeka

other ;xoYIslonafor the biapoaltlon of ptnaltIra. The quaatlanhere peaantad inroltaathe proper credltlneof penaltlasas betwtenvarious funds whan the hLeglelatura

has not g.lrm any 8ptolPloalraotIon with refuonca thu*to.

ft mu16 sees to rollaa, by analogy to the mneral rulea hereimmrt stated, that in the abaenat Of at@tUt~rV pr@Ylslonsto the contrary, $NaSltie6 COlieOtSdfOF 88X dalinguaocyshould fo31ow the prl::olpal and be prora886among the Yarious fund6 ror whl0b the ttxe5 W4rt collt0tad. If thj.8 were not true than would be no proYiaiOnf0r the daposit and accountingrOr pesmltlosmai lnttraat.

It is thareforeour opinion that panaltltdend interest, toftsn mlleotsd, &oultI be proratedand pl8Ued to the or&It of the various fund6 to vAii.oh the tax88 in que@- t;On ware due and upOn Rich the penaltimeand Intares% 10 c,uestion

aocrutd.

### Eon. 3. Plaer Powell, yasrs 4

You diaauar a further ‘question %n your letter but iron attached corre4pondeno4 and other data wu believe i t does not oonawn the aountp, but la a qu8stion affeoting a water lmgroventent

dietclctand 

## its bondholders, whiah it would hardly be groper ror UB to atteknpt to 4mw4r.

IfIRST AC: fiTTORNFi

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