Court Opinion

ID: 4129909
Source: CourtListenerOpinion
Date Created: 2017-02-18 00:57:55.518072+00
Date Added: 2024-06-11T14:33:23.204140
License: Public Domain

QBffice of tty Bttornep Qheral
                                     &Mateof Qexae
DAN MORALES                             November lo,1993
 ATTORNEY
      GENERAL

    Mr. Ray Farebee                                OpinionNo. DM-272
    vichMcellor8ndGenerslcounsel
    05ce OfGeneral counsel                         Re: Whether, under section 11.11 of the
    TheUnksityofTexas       System                 Tax Code, the M.D. Anderson Cancer
    201 west !kventh street                        Center Jesse H. Jones Rotary House
    Austin, Texas 78701                            Jnternationaliexemptfivmrdrplorem
                                                   taxation and related question (RQ-593)

     Jhr Mr. Farabee:

            On behalf of the Board of Regents of The University of Texas System (the
     “board”), you have ssked us to determine whether the M.D. Anderson Cancer Center
     Jesse H. Jones Rotary House International is exempt fkom cul v&rem taxation under
     section11.11 oftheTwCode. Weconcludethatitis.

             Reasoning “that cancer is causing four thousand (4,000) deaths annually in Texas,
     thatmanyofthe~~soafflicted~indigentpasons,thatthaeism,rdequate
     provision made in this State for the study of the cause, prevention, or cure of cancer, and
     that there are no State institutions devoted thereto,” the 1egislaturecreated the hospital    .
     that now is denominated The University of Texas M.D. Anderson Cancer Center (the
     “Cancer Center”) in 1941. See Acts 1941.47th Leg., ch. 548, at 878. Cummtly, chapter
     73, a&chapter C of the Education Code provides for the Cancer Center. Seotion 73.102
     of the Education Code states that the Cancer Center end its substations1 “shall be devoted
     tothediagno~tea&ingstudy,prevenGon,and                tmatment of neoplasti~ and allied
     diseases.” Sections 73.110 end 73.111 of the Education Code authorize the board to
     accept gifts snd gmnts of money for the benefit of the Cancer Center and its substations.
     You state that the Jesse H. Jones Rotuy House International (the “Rotary House”), which
     opened in February 1993, was constructed on Jandsthe board owns end was built Tom

                                              p.   1416
Mr. RayFarabee - Page 2                  (DM-272)

gifls of eight million dollars from the Rotary Club of Houston and the Houston
Foundation, in addition to nine milliondollars that the board raised through the issuance of
revenue bonds. We understand that the board owns the Rotary House.

         You have included with your letter a statement from Michael J. Best, Chief
Fiicial Officer of the Cancer Center, and a brochure promoting the Rotary House.
Mr. Best describes the Rotary House as a “patient housing center” where a Cancer Center
patient and the patient’s fknily may stay while the patient is undergoing treatment at the
Cancer Cmta. Guests of The University of Texas Systems (“The Unkmity”) also may
stay at the Rotary House. Mr. Beat explains:

               Promotion and marketing of the Rotary House is confined to
          publicizing its services to [Cancer Center] patients and their guests
          and to guests of the University. . . The Rotary House does not
          actively seek business Sam the public at large. . . Our experience
          since opening to our guests on February 13.1993[.] reflects that only
          patients, their hmilies[,] and University of Texas visitors have been
          guests at the Rotary House.

Mr. Best also states the room rates at the Rotary House are below market rates for
comparable lodging. Fiiy, Mr. Best states that no rooms are leased on a long-tam
baais to employees and that no permanent residents stay at the Rotary House.

       The promotional brochure points out several special features of the Rotary House:

              -The Rotary House is connected to the Cancer Center by an
          overheadwaUway’andcoveredgardenwalk.         TheRotaryHouse
          also provides wheelchair-equipped tmnspotion    to the Cancer
          Cults.

               -All rooms accommodate wheelchairsand medical equipment.

               -Every room is equipped with a refrgerator, microwave, dishes,
          dishwasher, iron, and ironing board. Laundry facihties are available
          in the building.

              -The television in every room is linked to the Cancer Cent&s
          closedcidttelevisionchannelssothatpatimtsandfamiliescan
          watch patient educational programs in their rooms.

                                         p.   1417
Mr.RayFarabee - Page 3                  (DM-272)

              -The Rotary House has a PatienVFamily Learning Center,
          wherepatientsandfamilymanbasurnleamtoweforthanselves
          anddealwiththeirihness.

              -The Rotary House offers patient and family education classes;
          itbb9avidwtapelibraryof~can~ctionaltapesthat
          ptiClltSMdfh&lieSUlilyVi~iIltheirroomS.

              -The Rotary House offers planned social actkities, including
          cmfl-making clsssea, shopphlg and RcreationsJ trips, and support
          groups;it~~~letothepatiartsMdbrmiliesits~cand
          game room, leisure liirary, counAiq services, and chaplains.

        Article VIII, section 2(a) of the Texas Constitution authorizes the legislature to,
“by general laws, exempt from taxation public property used for public purposes.” See
UnitedStotes v. 120,000 Acres of Land, 50 F. Supp. 754,755 (N.D. Tex. 1943) (stating
that azticle VIII, section 2 requires public property to be devoted to public use); C~(Yof
San Antonio v. Son Antonio In&p. Sch. Dia., 535 S.W.2d 671.675 (Tex. CN. App.-El
Paso, writ refd n.r.e.), &‘d, 550 S.W.2d 262 (1976) (stathtg that article VIII, section 2
refers to ad w&rem taxes). Pumant to the authority article VlD, section 2(a) grants it,
see 21 J. HOwELL,PROPERTY          TAXES8 200, at 130 (1975) (stating that article VT&
section 2 simply grants legislature power to exempt public property used for public
purposes), the legislature has enacted section 11.11 of the Tax Code, which provides in       .
putinent part as follows:
               (a) Except as provided by Subsections (b) and (c) of this
          section, property owned by this state or a political subdivisionof this
          state is exempt fi-om taxation if the property is used for public
          PUrpo=s.
               (b) [patainiag to land Permanent Unkrsity Fund owns]

               (c) [Pert&ingtoagriculturalorgrazinglandacountyownsfor
          the ba& of public schools]

               (d) Proper& owned by the state that is not used for public
          purposes is taxable. Property owned by a state agency or institution
          is not used for public purposes if the proper& is rented or leased for
          compmsationtoa~ebusinessentaprisetokusedbyitfora
          purpose not related to the performance ofthe duties and tlmctions of
          the state agency or insdmtion or used to provide private residential
          housing for compensation to members of the public other than
          students and employees of the state agency or institution owning the

                                         p.   1418
Mr.RayFarabee - Page 4                    (Di-272)

           property, unless the residential use is secondary to its use by an
           educfdionalinstitution primarily for instructional purposes. , .

                (e) It is provided, however, that property that is held or
           dedicated for the support, maintenance,or be&it of an institution of
           higher education as de&d in Chapter 61. Texas Education Code>
           but is not rented or leased for compenmtion to a private business
           enterprise to be used by it for a purpose not related to the
           pdormancc of the duties and functions of the state or institution or
           is not rented or leased to provide private residential housing to
           members of the public other than students and emphq%esof the state
           or ktitution is not taxable. Footnote added.]

You state that the Harris County Appraisal District (the “appraisal district”) has cancelkd
the tax exemption on the Rotary House pursuant to section 11.11(e), based on the
apprakl district’s position that the Rotary House provides “private residential housing to
members of the public other than students and employees of the state or institution.” The
bard, on the other hand, believes that the Rotary House is public property “used for
public purposes,” thereby quah@ng for exemption 6om (d t&rem taxes under section
11.1l(a). We must determine, therefore, whether, to be exempt from cd wlorem
taxation, property that an institution of higher education owns must satisfy the criteria
articulated only in subsection (e), either in subsection (a) or (e), or in both subsections (a)
and (e).r

       InitiaUy,we note that an exemption from taxation is to be strictly construed, and
the language of the exemption must not be extended beyond the express requirements of             .
the language used. Jones v. Williums, 45 S.W.Zd 130, 131 (Tex. 1931); 21 J. HOWELL,
pRopERn TAXES§ 198, at 126 (1975). See gem&b G. Hartt, IIJ, Ad V&rem              T&es

                                          p.   1419
Mr.RayFarabee - Page 5                  (DM-272)

ami Non-P@ HeaM-Gve Facilities, 39 Tut. B.J. 864, 865 (1976). Thus, the pason
chiming an exemption bears the burden of proving that the propaty or tmmaction falls
within the ambit of the exemption. 21 J. HOWELL,srrgra. 8 198, at 126; G. Hartt, IIJ,
spa, at 865.

       The legislature added subsection (e) to section 11.11 of the Tax Code in 1983.
See Acts 1983,68th Leg., ch. 1007,§ 1, at 5419. As introduced in the House, House Bill
2156 did not propose to add a subsection (e) to section 11.l 1 of the Tax Code; rather, it
proposed to amend section 11.1l(a), (d) as follows:
               (a) Except as provided by Subsections (b) and (c) of this
          section, property owned by this state. [ef] a political subdivision of
          thisstate.p2:~~d~~ns~inscction
          61.003f7) nf t& &~8 M             (&& is exempt from taxation if
          thepropatyisusedforpublicplrpoeespy~~~~~~
          lslppQ&maint~Qt~QfminstihrtionQf~education.

               (d) Property owned by the state that is not used for public
          Purpo~NW9Idedicatedh2tb8~-maintenance.pC
          nf8g jnstitution efb&gJ r;ducationis taxable. m 8Jgf& w
          ownedbythestate.p~~nf~~[ageaey]or
          ~institutionPfhjOhP&&28~~gg@fQL~~
          dfpt&&&&QQ(&[:-]ifthe
          g&&8 ef &g property is rented or leased for compensation to a
          private business enterprise to be used by it for a purpose not related
          to the performance of the duties and fimctions of the state. p g~I&8!
          g&division’Qf~ 8t8& [eganay] or g8 instiMion g&g&&r 8dwxtion
          or used to provide private residential housing for compensation to
          members of the public other than students and employees of the
          state.8~8&&yi&8pf~~or~institutionpf~
          education owning the property, unless the residential use is
          secondary to its use by an education institution primarily for
          instructional purposes. Any notice required by Section 25.19 of this
          code shall be sent to the agency or in&ution that owns the property,
          ~ditshallllppearinbehalfofthestateinanyprotestorappcal
          related to taxation of the property.

        According to the bii analyms prepared for House Bii 2156. as introduced, the bii
proposedtoamendsection11.11 oftheTaxCodeto”incM~theconceptthatproperty
owned by an institution of higher education is exempt if used for a public purpose or is
held or dedicated to the support, maintenance, or benefit of an insthmion of higher
education and that property owned by ag insthution of higher education and not used for
[either a public purpose or for the support, maintenance, or benefit of the institution] is

                                         p.   1420
Mr.RayFarabee - Page 6                   (DM-272)

not exempt.” House Comm. on Ways and Means, Bii Analysis, H.B. 2156, 68th Leg.
(1983); Senate Comm. on Fii,             Bii Analysis, H.B. 2156. 68th Leg. (1983).
Representative Turner, the author of the bii stated on the floor of the House that the
purpose of the bill was to dispel some existing contusion regarding certain university lands
bystatingthat~v~~landistaxableiftheuniversityrmtsorleasestheland;ifthe
university does not rent or lease the land, and the university holds the land for a public
purpose, the land is exempt tkom taxation.6 Debate on H.B. 2156 on the Floor of the
House, 68th Leg. (May 30, 1983) (statement of Representative Turner) (tape available
kom House Committee Services OSice).

        While the Senate Committee on Finance discus4 the bii a senate committee
member stated that the proposed amendments to subsection (a) would have the effect of
exempting from taxation productive, incom~producing property belonging to a university.
Id. Senate committee members therefore asked Senator Harris, the senate sponsor of the
big, to prepare an amendment to the bill that would exempt 6om taxation only nonprofit
property, thereby effectively limiting the class of productive, income-producing property
of an institution of higher education that is exempt from taxation. Hearing on H.B. 2156
Before the Senate Comm. on Fii,                68th Leg. (May 28, 1983) (statement of
unidentiiied speaka) (tape available from Senate StatTServices).

        Consequently, Senator Harris introduced on the floor of the senate an amendment
to the bii that proposed to amend section 11.11 of the Tax Code by adding subsection (e)
(using language identical to the language currently found in section I 1.1l(e)) instead of by
revising subsections (a) and (d). Debate on H.B. 2156 on the Floor of the Senate, 68th
Leg. (May 30, 1983) (statement of Senator Harris) (tape available from Senate StatT
senices). The senate adopted the amendment. Subsequent to its adoption in the senate,
Representative Turna explained the intent of the senate amendment on the floor of the
house, indicating that the amendment only chnitied the “original intent of the bii in a little
bit betta form”; it did not substantively modify the proposed bill. Debate on H.B. 2156
on the Floor of the House, 68th Leg. (May 30, 1983) (statement of Representative
Tuma) (tape available from House Committee Services Oflice).

       Based upon our review of the legisiativehistory, we conclude that section 11.11 of
the Tax Code by its terms exempts from od dorem taxation property that an institution
of higha education owns if the property either saves a public purpose, see Tax Code

                                          p.   1421
Mr,RayFarabee - Page 7                   (DM-272)

~Il.ll(a),orisheldforthe~upport,maintmana,orbeneMoftheinstiturig~eid.
5 11.l l(e). However, since article VfII, section 2(a) of the Texas Constitution authorizes
the legislature to exempt from taxation public property only if the property is used for a
public purpose, public property that is exempt pursuant to subsection (e) because it is held
for the support, maintenance, or benefit of an institution of higha education is exempt
only to the extent that the property is used for a public purpose.

        Subsections (d) and (e) of section 11.11 explicitly stipulate particular uses of
public property that do not serve a public purpose. Subsection (d) specifically provides
that state-owned property does not serve a public purpose “if the properly is. . . used to
povid priwte resi&ntial houdng for compensationto members of the public other lhrm
stuhts cad empfqvees of the state agency or ktitution owning the property, unless the
residential use is secondary to its use by an educational institution primarily for
instructional pqoses.” (Emphasis added.) Similarly,subsection (e) specificallyprovides
that propaty of an institution of higha education does not qualify for the exemption (and
thus is not used for a public purpose) if the property is “rented or leased for common
to a private business enterprise to be used by it for a purpose not related to the
puformancc of the duties and timctions of the state or institution or is . rented or leased
to provia??priwte resiakntiol housing to members of the public other than stuhts ami
emplwes of the state or institution”7 (Emphasis added.) No one disputes that the
Rotary House is publicly owned; ultimately, we must determine. thaefore, whether the
Rotary House serves a public purpose. The central issue in our determination is whether
the Rotay House is used to prod& private residential housing to members of the public
other than stuoknt.9or employees of The University. If it is not so used, we must
determine whether the property serves a public purpose.

        The Tax Code does not d&e “private residential housing,”and we are unaware
of any other statutory provision that defines the phrase. Furthermore, the legislative
history of section 11.11(e) of the Tax Code does not indicate how the legislature intended
to use the phrase. Howeva, the legislative history of subsection (d), which also uses the
phrase “private residential housing,” provides some guidance as to the meaning the
legislature intended to attach to the phrase.

       The legislature added subsection (d) to section 11.11 of the Tax Code by the
enactment of House Bill 30 two years prior to the enactment of subsection (e). See Acts
1981. 67th Leg., 1st C.S., ch. 13. § 30, at 127. House Bii 30 of the S&y-Seventh

                                          p.   1422
Mr. RayFaabee - Page 8                 (DM-272)

Legislature, 6rst called session, was, essmtidy, a reintroduction of House Bii 1465,
which the legi&ture tabled during the regular session of the Sixty-Seventh Legislature.
The house wmmittee substitute for House Bill 1465 proposed to add section 11.1l(d) to
provide in perknt part as follows:
              Property owned by the Texas State Technical InstiMe or the
          Texas Department of Corrections is not used for public purposes if
          the properly is used to provide housing for employees or their
          familiesor~manbasofthepublicothartbanstudentsofthe
          Texas State Technical hitiMe or inmates of the Texas Department
          ofcomxuons. [Emphasisadded.]

        Rep-            Peveto, the author of House Bii 1465, informed a subcommittee of
the House Committee on Ways and Means that he was introducing this amendment to the
original bii specificallyfor the Huntsville area. Format Meeting on H.B. 1465 Before a
Subconunittw of the House Comm. on Ways and Means, 67th Leg. (Apr. 21, 1981) (tape
available from House Committee Services O&e). He explained that both the Texas
Department of Corrections and the Texas State Technical Institute (“TSTI”) owned some
homes that they rented out to their employees or to members of the general public. Id.
He stated that some members of the House Ways and Means Committee &it that such a
rental of a home was not serving a public purpose; ratha, the rental served as a “revenue
generator” for the govemmental body owning the homes. Id. Furthermore, according to
Representative Peveto, the people who live in the rental homes send their children to
school in the local school district, and they use city and county services; consequently,
they should be paying property taxes on the homes they rent. Id.

       Representative Peveto’s comments indicate that the legislature was concerned
primarily with the provision of housing to persons who plan to reside at the leased
property long enough to take advantage of the local schools and city and county services.
We note that the SiiSeventh Legkkre, during its 6rst called session, moditied the
proposed section 11.1I(d) to apply not only to the property that TSTI and the Texas
Depatment of Corrections own that is “used to provide housing for employees or their
fkmiks or for members of the public other than students. . or inmates,”but to property
that any state agency or institution owns that is “used to provide private residential
housing for compensation to member of the public other than students and employees.”
Compure C.S.H.B. 1465,67th Leg., 8 23 (1981) wir%Acts 1981,67th Leg.. 1st C.S., ch.
13,s 30, at 127. Despite the modiScations,we believe the legislature remained concerned
about the kct that, at that time, members of the public who reap the be&its normally
accorded to taxpayers. such as the use of the local schools, city services, and county
savices, could rent homes on tax-exempt property owned by state agencies or institutions.
We therefore construe “private residential housing” in both subsections (d) and (e) to
mean housing in which certain memberaof the public live longer than temporarily.

                                        p.   1423
Mr.RayFanbee      - Page 9               (DM-272)

       In determining whether property is being used to provide “private residential
lmsing” within the context of section 11.1l(d), (e) of the Tax Code, we believe that we
must apply an anslysis similar to that used to determine whetha property is a “residence”
for purposes of other statutes. Admittedly, “[t]he term ‘residence’de&s easy definition.”
Attorney General Opiion J&5-611(1986) at 2. The Texas Supreme Court has, howeva,
provided some direction:
          The meaning that must be given to [the term “residence”] depends
          upon the kxmstances surrounding the person involved and largely
          depends upon the present intention of the individual. Volition,
          intention and action are all elements to be cotidered in determhdng
          whereapersonresidesandsuchekmentsareeqwllypertinentin
          denoting the pamanent residence or domicile.
Mills v. Bartlett, 377 S.W.2d 636,637 (Tex. 1964); Attorney General Opiion JM-611 at
2 (quotingMills. 377 S.W.2d at 637); see ako BLACK’SLAW DICTIONARY1176(5th cd.
1979) (detining “residence”as “persona)presence at some place of abode with no present
intention of definite and early removal and with purpose to remain for undetermined
period, not infrequently, but not neces&ly combii with design to stay permanently”);
WBBSTBR’S    NINTH NEW COLLBGIATB         DICTIONARY1003(1990) (detlning “residence”as
“the place where one actually lives as distinguished from.. a place of temporary
sojounP); cf. Attorney General Gpiions JM-1223 (1990) at 4-5 (quoting, as example of
proper construction of “residence,” Election Code section 1.015, which de&s
“residence”for purposes of Election Code to mean “domicile,that is, one’shome and fixed
place of habitation to which he intends to return atta any temporary absence”); TM-367
(1985) at 3 (quoting Pews & N.T. I@. Co. v. lhmpson, 167 S.W. 801,803 (Tex. 1914))
(equating “residence” for purposes of Education Code with “domicile,”which means
“living in [a particular locality] with the intent to make it a t&d and permanent home”).
In general, the determination of one’s residence depends upon factual circumstances and
individual intention; it is thacfore suitable for judicial detemnnation. Mih, 377 S.W.2d
at 636.

        Thus, for purposes of section 11.1l(d), (e) of the Tax Code, the determktion of
whether certain proper&yis used as “private residential housing” “depends upon the
circumstances surrounding the person involved and largely depends upon the present
intention of the individual.” Id. at 637. While such a detemktion generally requires an
exanktion of factual circumstances and individualintention, we believe that we may say
as a matter of law that the legislature did not intend “private residential housing”to refa
to a place, such as the Rotary House, which provides only temporary accommodations for
patients at the Cancer Cmta and their fiunilies and for guests of the unkersity. We
conclude that the Rotary House is not “used to provide private residential housing”in the
context of section 11.1l(d), (e) of the Tax Code. Next, we will consida whetha the
Rotary House serves a public purpose. :’

                                        p.   1424
Mr. Bay Fanbee - Psge 10               (Dll-272)

         To determine whether public property is used for a public purpose, the Texss
Supreme Court hss applied a test: whetha the property is used primarily for the health,
comfort, and welfare of the public. A. &M. Consol. In&p. Sch. Dist. v. Ci@ of Bryan,
184 S.W.2d 914,915 (Tex. 1945); Attorney General Opinion JM405 (1985) at 3. The
proper& need not be used for govanmemal purposes; the property only must be such that
all of the public hss a right to use it onda proper regulations. A. &MYCd.       Indep.
sch. Dist., 184 S.W.Zd at 915. Furthermore, the tkt thst the governmen owna  tal
&ages or receives compensation for the use of the property does not mean thst the
properly loses its exemption &rn ad t&rem taxation, provided that the chages sre
iacidcntaltotheuseofthepropatyllndtheproceedsreceivedfortheuseofthepropcrty
inure to the be&t of the gownmatsl owna. Id. at 915-16, see al.w Attorney Genersl
Opiion JM-405 st 3 (citing Lower Cdo. River A&. v. ChemicaI Bank & Tv.s? Co., 190
S.W.Zd48, SO(Tex. 1945);A. &M. cansal. Zdep.Sch. Dia., 184 S.W2dst915-16).

       You state that members of the medical profession often prescribe outpatient
trmtmmt for persons d&nosed with aeopkstic dkeases, thereby reducing the costs to
both the patient snd the hospital. A patient in a private hospital room at the Cancer
Cmta pays $385 per day for the room, as opposed to S65-$85 per day for a room in the
Rotary House.’ Additionslly, the Cancer Centa spent less to const~ct the Rotary House
than it would have spent to ccmstruct additional hospii rooms; overbead expenw
incured in operating the Cancer Centa slso are mch greata than overhead expenses
incumd in operating the Rotary House.

        We believe thst the Rotary House aids the Cancer Centa in the sccomplishment of
its purpose-the “diagnosis, teaching, study, prevention, end treatment of neoplastic snd
died disases.” See Educ. Code 8 73.102. Additionally, you inform us that the Cancer
Centa uses all incame derived from the Rotary House to hd its operations. In our

                                      p.   1425
Mr. RayFarabee - Page 11                (DM-272)

opinion, therefore, the Rotary House is used prhnarhy for the health, comfort, and welt&
of the public, and satisties the Texas Supreme court’s test fix determkg whetha public
propaty is used for a public purpose. See A. &M. Cansol. It&p. Sch. Dist.. 184 S.W.2d
at 915. Because we have found that the Rotary House is not used to provide private
residential housing and servea a public purpose, we cot&de that it is exempt from
taxationprsuanttosc&n          11.11 oftheTaxCode.

         The chief appraiser of the appraisal district has asked us to determine whetha, if
we conclude that the Rotary House is exempt from all ad w&rem taxation unda section
ll.lloftheTaxCode,theMarriott’sinterestintheRotaryHouseistaxabletothelessee
pumant to section 25.07 of the Tax Code. While the chief appraiser’s question is
premised on his contention that the Mawiott Management Stices Corporation leases the
Rotary House from the board, documents you have submitted indicate that the Marriott
Management Services Corporation provides daily management of the Rotary House, but it
does not lease the facility. Whether the Marriott Management Services Corporation has a
leasehold intaest in the Rotary House or simply provides management services is a
question of fhct that we cannot resolve in the opinion process. See Attorney General
Opinion DM-98 (1992) at 3. Furthermore, this office does not construe contracts,
Attorney General Opinion DM-192 (1992) at 10; consequently, we cannot examine the
agreement between the Marriott Management Saviccs Corporation and the board to
determine the Marriott’s interest in the Rotary House. But see Tax Code 8 25.07; Ci@ of
Beaumont v. Fertitta, 415 S.W.2d 902,911 (Tex. 1967); Mmttn v. Ci@ of Mesquite. 590
S.W.2d 793, 798 (Tex. Civ. App.-Dallas 1979, writ refd n.r.e.) (discussing V.T.C.S.
articles 7173 and 7174, predecessors to Tax Code section 25.07, among otba sections of
Tax Code); Attorney General Opiion M-3 19 (1968) at 5.

                                  SUMMARY

                Pursuant to section 11.11 of the Tax Code, property that an
          institution of higha education owns is exempt from taxation if the
          property either serves a public purpose, or is held or dedicated for
          the support, maintenanw, or benelit of the i&t&ion. To the extent
          that property that is held or dedicated for the support, maintenance,
          or benefit of the institution is not used for a public purpose, howeva,
          it is not exempt from taxation. Furthermore, section 11.11 specities
          that public property is not used for a public purpose if the property
          is, among otha things, used to provide “private residential housing”
          for members of the public other than employees or students of the
          ktitution.

              The determination of ,-whetha specitk property is used to
          provide “private residential housing”depends upon the circumstances
Mr. Ray Farabee - Purge 12               (DM-272)

          sumding       the person involved and bqely depends upon the
          present intention of the individual. Because the Jesse H. Jones
          Rotary House International provides only temporary accommoda-
          tions for patients at the M.D. Anderson Cancer Center and their
          families~foTBuest8ofTheU~~ofTausSystans,hisnot
          used to provide private residential housiq for purposes of section
           11.1l(d), (e) of the Tax Code. Additionally, the Rotary House is
          used primarily for the health, comfort. and we’re of the public; it is
          thaefore used for a public purpose. Consequently, the Rotary
          Houseisexrmptfromrdvalorenrtlucation~to~on                    11.11
          of the Tax Code.

                                                     DAN     MORALES
                                                     Attomey Genaal of Texas

WILL.PRYOR
Fii Assistant AttomeyGenaal

MARYKELLER
Deputy Attorney General for Litigation

RENEA HICKS
State Solicitor

MADELEINE B. JOHNSON
Chair, opinion Committee

&pared by Kymberly K. OltrogSe
Assistant Attorney Genaal

                                         p.   1427