Hon. Be8uford B. Jester 

&wernor of Texas 

Austin, Texas Opinion No. V-204 

lte : Power of the Automatic 

Tax Board, to set an ad 

valorem tax rate for 

the Available School 

Fund except for text 

books where suff iclent 

Dear Governor Jester: 

money is available in 

the clearance fund. 

Your request for opinion dated May 2, 1947., 

reads in part es follows: 

“Several authorities have expressed 

to me their graqe doubt as to whether, under the provisions of House Bill 301, recently enacted by the Legislature3 the Autoutic Tax board can set any ad valorem 

tax rate for the Available School Fund, except that portion needed for free textbooks. 

“This question is raised in relation 

to the foll&ing language of the bill: 

” t the’re is hereby approprlated, sll&itidj transferred and credited 

to the Available School Fund such a sum 

which when taken together with the total 

of all other statutory and constitutional 

amounts to accrue to the Available School 

Fund 11111 equal to such a total as may be 

needed to pay a Fifky-five dollar ($55) 

per .capita . a . . 

“The suggest ion tide to me is that if 

there should be sufficient money avollable 

in the clearance fund to pay the $55, the 

.Automatic Tax Board could not levy the ad 

valopem tax of 35 cents for schools D s 0 e 
. . 

Eon. Reauford Ii, Jester, Page 2, V-204 

“I shall’,be grateful for your opinion on the matter.” 

The Constitution of Texas, Section 3, Article VII, provides in part as follows: 

%ne-fourth of the revenue derived 

from the State occupation taxes and poll 

tax of one dollar a 0 0 shall be set apart annually for the benefit of the public free schools; and In addition thereto, 

there shall be l.evled and collected an annual ad valorem State tax of such an amount 

not to exceed thirty-five cents on the one 

hundred ($100.00) dollars valuation, es 

with the available school fund arising 

from all other sources, vi11 be sufficient 

to maintain end support the public schools 

of this State for a period of not less than 

six months in each year, and it shall be 

the duty of the State Board of Education to 

set aside a sufficient amount out of the 

said tax to provide free text books for 

the use of children attending the public 

free schools of this State; provided, howRetterating the sources of funds for the 

support of the public free schools, the Con& it ution 

provides for the foll.owlng: 

1. One-fourth of the occupation taxes, 

2. The poll tax. 

3. Other sources available to the 

school fund. These “other sources’ 

(Article 2823, lt. C. 5,) Include 

interest on bonds and other funds; 
Hon. Beauford Ii. Jester, Page 3, V-204 

interest on proceeds from the 

sale of land; moneys from leases; 

and all direct appropriations to 

the Available School Fund, except 

such final appropriation (5 below) 

as may be necessary to make UP the 

deficit In the total sum required 

to maintain end support the publtc 

schools, 

4. Ad valorem tax not to exceed 35 

cents on the hundred dollar valuation. 

5. Appropriations from the general revenue to make up the "deficit", if 

the four above listed sources are 

Insufficient. 

Under the Constitution, the general reve'nue 

may be used for the support of the publFc free schools 

in two ways. First, direct appropriations may be made 

from the general revenue to the Available School Fund 

and be included as one of the "other, sources’ (item 3 

above) to be considered by the Automatic Tax Board In 

fixing the ad valorem tax rate for school purposes, 

This is in accord with the Interpretation of Article 

VII of the Texas Constitution made over a long period 
Hon. Beauford Ii. Jester, Page 4, V-204 

of years by the Legislature and the Courts, In defining what shell constitute the Aveil,able School Fscd, 

Article 2823, v. C. s., the Legisls,ture said thatt ir 

should include “other Available School Funds prcrlded 

by Iaw,” The history of educational legislation 1.n 

Texas shows that the provisions o.f Artlck XI, -,ke 

edncat:lonel Artic1.r of t.he Con.st itotioc,, ?mve never 

bets regardcld as lin~ltetic~:~s ‘bg~ impll.cat.lon on tnc 

gEC?l.ei'al power af tk Legl.s~.st:ure t3 appropriate mou 

e.;: fern the general Lund ar:d fPOlli 0tk5P sources ti.r,- 

act to the Avalleble School Fund or to ctkr schcoi 

p!lrpuse 3. On many cccaslocs the Texe:s Legislature 

has made direct apprcprietions from the generai revsue to the Available School Fund, end on several occasions larger percentages then oc.e fcurth of the occupation taxes have been assl.gned to the Schcol Fund. 

These Acts, and this Ieglslatlve interpretation. of 

the Constltut ion, have been approved by our courts 0 

See, Mumme vs. Marra,; 120 Tex. Reports 383, When 

such direct appropriations are made to tfie Available 

School Fund before the ad valorem tax Is set, it 1s 

clear that they are to be considered In arriving at 

the rate of ad veiorem tax needed for school purposes. 

The second manner in which appropriations 

may be made from the general revenue is outlined In 
Han; Beauford H. Jester, Page 5, V-204 

the last phrase of that portion of Sect Ion 3, APtitle VII, quoted above, for the purpose of making 

up the deficit, if any, after totaling the estimated 

revenue from all of other sources named above, lncludlng the ad velorem tax (Items 1, 2, 3, and 4 

above) S When It is clear that such appropriations 

are made by the Legislature only for the purpose of 

raising the total available funds to the amount required to meet the necessary per capita apportlonment, obviously they should not be considered by 

the Automatic Tax Board In f lxing the ad velorem 

tax rate for school purposes. Such appropriations 

could not be credited to the Available School Fund 

until after the ad valorem tax rate has been set and 

the est lmated def felt , If any, has ‘been determined, 

Therefore, it remains for us to determine 

what typs of appropriation was contemplated and ectuallg mede by the 50th Legislature In House Bill 

301. The bill provides, in pert, as followsz 

“‘(4-e) After the above allocations 

and payments have been made from such Clearance Fund, beginning with the fiscal year 

September 1, 1947, end annually thereafter, 

there is hereby appropriated, allocated, 

transferred, and credited to the Available 

State School Fund such a sum which when 

taken tonether with the’ total of all other 

statutory and c 

true to the Ava 
Hon. Beauford H. Jester, Page 6, V-204 

to such a total as may be needed to D y 

a Fifty-rive Dolla capita ip- 

;r:;zynt for eagh’ f%‘e%y scholastic 

tate-approved school census for 

vision of this Act by taking into account 

his estimate of such other constitutional 

and statutory amounts to accrue to the 

Available School Fund as made at the beginning of each fiscal year. Thereafter the 

Comptroller shall allocate, transfer, and 

credit monthly in equal monthly installments 

from the Clearance Fund to the Available 

State School Fund such amount as so determined . The Comptroller Is hereby authorized to modify from time to time during 

the fiscal year his estimates of the revenue to accrue to the State Available School 

Fund in any one year, and shall la the 

light of the revised estimate or estimates 

increase, diminish, or suspend any remaining monthly payment or paymsnts from the 

Clearance Fund to the Available School Fund, 

provided by the close of each fiscal year 

there shall have been paid from the Clearance Fund to the Available School Fund 

such an amount as may be neaded to enable 

the Available State School Fund to pay 

said Fifty-five Dollar ($55) pel;, capita 

apportionment annually in full e 

Clearly, we believe that the Legislature intended by this Act to provide the second type of approprlation above discussed. This bill contemplates 

the transfer of no money to the Available School Fund 

until after “the total of all other statutory and constitutional amounts” have been considered, determined, 

and credited to the School Fund. go part of such allocation should be considered by the Tax Board in 
Hon. Beauford H. Jester, Page 7, V-204 

setting the ad valorem tax rate for school purposes, 

The Board should set the rate of such an amount as 

with all other sources of school revenue, will meet 

the $55 .OO per capita set by the Legislrt ure, and, 

without considering any portion of the funds that 

may ba allocated thereafter under House Bill 301 to 

make up the balance, if any, necessary to pay such 

per capita apportionment 0 

That this was the intent of the, Legislature 

in House Bill 301, i3 shown by the fact that the Comtroller Is not authorized to transfer any of the money from the Clearance Fund until September 1, the 

beginning date of each fiscal year 0 Prior to that 

time, within five days after July 15th of each year, 

the Tax Board is required by Article 7043, V0 C. 3, 9 

to meet and calculate the ad valorem tax rate for 

school purposea for the next fiscal year. Only after 

that has been done and not before September 1st of 

the aan year may the Comptroller transfer money from 

the Clearance Fund, if needed to pay the full $55”00 

per capita apport ionmeat s 

Therefore, the Automatic Tax Board must 

mset In accordance with Article 7043, V, C, 3,, aad 

levy an ad valorem tax of such an amount, not to exceed 35# on the $lOO,OO valuation, as with the available 
Hon. Beauford Ii. Jester, Page 8, V-204 

school fulla arising from all other sources (not including the allocation in Ii. B. 301) will be sufflclent to pay the $55.00 per capita for maintenance 

and support of the public schools. Thereafter, if 

the total of the ad valorem tax and all of these other aourcea is Insufficient to pay the $55.00 per capita, and only in such event, the Comptroller Is authorized by 11. B. 301 to transfer such aurns as may be 

necessary to make up the full per capita of $55.00 

set by the Isglslature. In no event is the Comptroller authorized to determine the amount to be transferred or to make any portion of such transfer from 

the Clearance Fund until the beginning date (September 1st) of each fiscal year. 

SUMMAHY 

The allocations authorized in House 

Bill 301, 50th Legislature, from the Clearance Fund to the Available School Fund are 

limited to such amounts as may be necessary 

to pay the $55.00 per capita apportionment 

after the Automatic Tax Board has levied 

an ad valorem tax for school purposes not 

to exceed 359? on the $100.00 valuation. 

The Automatic Tax Board must levy the ad 

valorem tax without regard to any suma 

that may become available later from the 

Clearance Fund. The State Comptroller is 

not authorized to transfer any money from 

the Clearance Fund until September 1st of 

each fiscal year, such date being subsequent to calculation and levy of the ad 

valorem tax by the Automatic Tax Board. 
Hon. &auford H. Jester, Page 9, V-204 

Sincerely yours, 

/s/ Price Daniel 

Price Daniel 

Attorney General 

PD:sh:mrj 

The foregoing opinion was considered 

and approved in Confere 

9 

ce composed of Assistant Attorney Genera' Fagan Dickson, 

Chester Chester Qlllson, Qlllson, Joe Gr+enhlll, Gr+enhlll, J. C. Davis, 

Jr., and Ocie Speer. 

/a/ Fagan Dickson 

Fagan Dickson 

First Assistant Attorney General 

Chairman of the Conference 

Approved: May 19, 1947 

Attorney General of Texas 

This Opinion aonsidered and 

approved in limited conference.