L --
E ORNEY GENERAL
EXAS
FVIILL WILSON AITORNEYGENERAL August 29, 1960
HonorableRobert S. Calvert opinionlo. WW-gag Comptrollerof PublicAccounts state Capitol Be: Whether or not a dietrlbutor Austin,Texae of gas, electricityor water to an Air Force Base, located within the city limitsof an incorporatedcity of more than 1,000 inhabitants,should Includethe receiptsitim the salea to the Air Force Base Dear Hr. Calvert: BB taxablegrow receipts.
Your recent letterbroughtto the attentionof thie office certainfaote concerningan Air Borce Baee locatedwithin the city Usita of an iuaorporatedcity of more than 1,000 inhabitante.
Tip Base purchase@gas from the Lone Star Gas Company throu& a singlemeter locatedat the base boundary. The gae is then dletrlbutedthrougha dlstrlbutionsyetemowned by the United Statea ,p~f~ used for ordinarypurpoms - - - heating,cooking, 'hot water service,etc. Gas is separatelymetered by the baae and a caeh charge ie made to certainprivateconceeeionsusing gas ou the air base, such as laundryand gasolinefillingstation. The remainderof the &as, vhioh is used by the variousair force facilities, is pro-rated and chargedon an estimatedconsumptionbasic againstthe atioounta and availablefunds of the facilitiesas * metter of governmentalfiecal aocountlng.
With referenceto theee facts,you aek two questions:
(1) Ia the Air Base located"withinan incorporated aity" within the meaning of Article 11.03,Title l22A, Taxatloa4enerelTex.Rev. Civ. Statute8 (1925)formerly ~'~oodlfied a.8Article 7060,V.A.C.S.'T
(2) If the Air Force Base ie located "within'%e oitp lW.te, Is the FederalGoverumenta "gas plant" or "distributor"withid the meaning of Article 11.037
Pertinentproviaioneof the Articlein queetlonare (18 followsc
"(1) Laoh individual,oompany,corporation,or HonorableRobert S. Calvert,page 2 @W-909)
aerooiatlonowning,operating,managingor con- trollingany gae, electriclight,electricpower, orwater worlm, or water and light plant, located within a~ incorporatedtown or city in thle State, and used for local-ealeand dietributlon in raid town or city, and chargingfor such @a, eleotrioli&te, e&trio powa;, or water, - ahallmake quarterly,on the first day of Jauuary, April, July and Octoberof each year, a report to the Ccmptrollerunder oath of the individual,or of the preeldant,treasureror superintendent of such company,or corporation,or aeeociationehowiq the gross amount receivedfrom such baainees'doneIn each euoh incorporated oity or town within thie State in the paymentof ohargesfor such EM, electricli&te, electricpower, or water for the quarternext preceding. . . Nothingherein nhall apply to any such gas, electriclight, power or water works, or vater and 11&t plant, within this State, owned and operatedby any city or town, nor to any countyor water jmprovement or conrervatlondistrict . . .*
(2) Rothlngherein shall be construedto requirepaymentof the tax on grose reoeipts hereih l&vied more.thaaonoe on the a8me c&modlty, and where the commodityla produced by one iadividua?.,company,corporation,or association,and distributedby another,the tax ahall be paid by the dlatribut~ralone."
It is undisputedthat the Air Base ie loaated within the gqographioalllmltaof the city; it is, therefore,"within'the city ad comprehendedby Article 11.03
It ie axiomaticthat the State cannot lay LLdirect tax on an inotrumentality of the BederalGovernment. TherePore,the only seriousqueetlonpresentedby your requestis whetherthe Air Base lo a "gas plant" or "distributor"within the meaning of Article 11.03.
The court in the c*ae of Utilitieslatural@as Co. v. State, 118 S.W.a gZ%tated that the tax laid by Article 706Ow~w an exolse
'This case