Court Opinion

ID: 4137969
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:31:01.687014+00
Date Added: 2024-06-11T14:19:26.337435
License: Public Domain

April    4, 1949

Hon. E. V. Spence, Chairman
Board of Water Engineers
Austiri, Texas
                              Opinion    Wo. V-003         c
                              Fle: Authority      of Board to
                                      entertain   appropriation
                                      application    of Upper
                                      Colorado River Authority

Dear Sir:
              The question          submitted for      opinion      is con-
tained     in your letter,          which we copy      in part      as fol.-
lows :
                ‘In Attorney    Oeneral’a      Opinion
         No. O-7338, approved August 9, 1946,
         it Is held that the Upper Colorado
         River Authority,     a atate      agency,     cre-
         ated by act8 of the Regular           Session      of
         the 44th Legislature,       Chapter      126, ia
         not required     to secure a permit         from
         the Board of Water Engineers           to ap-
         proprlate    waters within      Its boundaries
         and that the Authority        ia not subject
         to payment of feea preecribed by Articles
         7497 and 7532, Vernon’8 Annotated              Civil
         Statutes   of Texas.
                “Notwithrtandlng          thle opinion,      the
         Upper Colorado River? Authority              cannot
         get its proposed         projeata     finanoed     with-
         out having    flrrt      seuured     a permit    from
         the Board of Water Engineers protecting
         ite source of water supply under the
         Doctrine   of Approprlatlon.             Therefore,
         the Authority       filed     its application       and
         was granted permit by the Board covering
         lta Robert bee project             on the Colorado
Hon. E. V. Spence             - Page 2 - V-803

         River in Coke County, and is now pre-
         paring    to file  an application     to ap-
         propriate     and use the waters    stored    in
         the North Conch0 River Flood Control
         Project     In Tom Green County for munlci-
         pal, Industrial      and irrigation    purposes.
                  "Article     7501, Vernon’s Annotated
         Civil     Statutes     of Texas, reade a8 fol-
          1OWB:

                  “‘Every such application    shall   be
                  accompanied   by the fees hereinafter
                  provided,   add shall  not be filed
                  or considered   until  such fees are
                  paid. t
                 “In view of Artiole     7501, can the
         Board of Water Engineers         file   and con-
         elder    the application     of the Upper Colo-
         rado River Authority       for permit      to ap-
         propriate     the waters   in the North Con-
         cho River Flood Control        reeervolr     wlth-
         out It being accompanied        by the feea
         prescribed     by Articles    7532 and 75357”
                 The question       which you raise   has been the
subject        of many prior       opinions by thie   office, which
we   briefly       review     ae follows:

             1.    Letter      opinion    dated June 30,     1925, by
Assletant    Attorney      General C. L. Stone,         addressed    to
the Game, Fish & Oyster Commlsslon,               decided     that the
Commleelon need not pay the statutory                feea in order
to acquire    a permit       to appropriate      water for the pur-
poee of maintaining          a game prerrerve     and fish hatchery.
The basis    of the opinion          Is that since game, fIeh,
water,    and permlt      fees are all the property of the
State,    and slnoe the fee statutes            do not expressly
require the oomml~slon to pay the feen, none need
be paid,
              2.  Letter   opinton  dated January     3, 1938,
by Asslntsnt Attorney Qeneral Ruaaell          Rentfro,     ad-
dressed    to the Board of Water Engineers,        Involves
the liability     of the Federal    Farm Security     Admlnia-
tration    for payment of Baid fees.       The above oplnlon
of June 30, 1925, was distinguished          on the ground
that the same community of interests          between game.
fish,   water,ard    fees ‘existing  there did not ,..*A.<*,
exist   in the case of the Federal       Earm Security AG-
Hon. E. V. Spence         - Page 3 - V-803

ministration.       The opinion  holds that since the fees
are not taxes,      80 as to forgive   payment thereof
by the Federal      Government,  and Article    7532 being
mandatory,     your Board had no alternative       but to
collect     the fees prescribed    by said article-~

               '3. Letter      opinion     dated March 8,‘1938,
by Assistant        Attorney     General H.. L..,Wllliford,
addressed      to the Brazes River Conservation                  and
Reclamation       District,      holds Baid DiBtI?i,Ct exempt
from the fees in question.               It was suggested           in
the letter.     requesting       the opinion       that since the-
fees~ are paid by your Board directly                   Into the Gen-
eral Revenue Fund and since the net revenue                       of the
Brazes Diatrlct          is also paid. into said fund, payl.
ment of the fees would be nothlng~ more than a
bookkeeping       transaction,       and thesefore         need not
be pai.d.      The opinion       recognizes      this argument
but bases its holding            upon utility        considerations,
stating     that since “the entire            enterpriee       is an       .
undertaking,by         the State     to conserve        its public
waters and to utilize            same for the benefit            of the
State in ita entirety           ,~. . . the fees are not re-~
qulred. ”
                4. Letter        oplnlon    dated May .4, 1938, by
Assistant      Attorney      General H. L. Wllli~ford,         ad-
dressed     to Upper Red River Flood Control               and Irri-
gation     District      holds such ,dlatrict        not liable~ for
the fees.        Utility     considerations       were again em-
ployed,     it being pointed           out that the Irrigation
District      is a state       agency exercising        powers .and
privileges       in furtherance         of governmental      pur-
pose.      Xn   addltlon,      It  was   stated   that   one  deport-
ment of government           la not required        to pay another
department       a license       or prlV.llege    tax sin,ce this
would be merely paying              the revenue ,of ,the State
Into the revenue          of the State.
              5.‘. Letter oplnlo,n dated May 13, 1939, by
Assistant     Attorney General ?Ngene Tate,         addressed    to
Board of Water Engineera,        overrules      the Wllllford
opinion   of May 4, 1938, and holds the Upper Red Ri-
ver Flood Control     & Irrigation      District    lfable for
the fees.    Earlier   opinions    were reviewed      and the
Game, Fish and Oyster Commission and Srazos District
opinions   approved.    It is clear,       however,    that ?,he
Brazes opinion     was not approved upon the utility
                  .

Hon. E. V. Spence         - Page 4 -V-803

baais upon-which    it naa decided      but upon the basis
euggested   for decision,     namely,   that the net revenuea
of the Brazoe Dlatrlct       ultimately    find their way in-
to the General Revenue a8 do the fees collected          by
your Board.     Baa&use the Upper Red River District’s
Act did not contain      thle net revenue provlalon,      It
wae held liable    for the fees.

            6. Opinion Uo.O-78, dated January              13,
1939, addressed      to the State    Parka Board, holds such
Board not liable       for the fees.     This opinion      reviews
all prior   opinions      and adopts a8 lte basis       the above
indicated   fee theory.        It 18 asserted   that the Parke
Board falls    within     that class   of governmental      agency
which is not required         to pay the fees since its re-
venues go into and come out of a State            fund.
             ‘7.      Opinion So.O-4304,     approved Pebruary
9, 1942, addressed        to the Loner Colorado        River Au-
thority,    holds the Authority          not liable   for the
feea,     The basla   of this opinion         Is the inability
of the Authorlty      to spend its fund0 for any but a
btatutory    purpose.       It wan decided       that the Author,ity
acquires    no right    through      such a permit,     its right,to
appropriate     being oonferred        by Its hot, in consequence
of whioh payment of the fee in order to ueoure the
permit would be use of Its fundr for a non-statutory
purpose.     The earlier       oplnlonn     on the subjeot were
not disouased.       Neither      the Upper nor Lower Colorado
hot8 aontain     a provision       whereby net revenuea        go into
the Qeneral Fund.
             8.Opinion No.O-7330, approved Awuat 9,
1946, addreseed   to the Upper Colorado   River Authority,
reaohes  the same rerult and for the name rea.aon an
that set forth  in Opinion No.O-4304,   Irupra.
             Artiole 7532, V.C.B., aeta up the various
fee8     in question,     -The opening rentenoe         of said artlole
provider that “The Board ahall oharge and oolleot                    for
the benefit       of the State      the fees hereinafter        pro-
vided.     , . .‘I The fee8       referred     to under thlrr lan-
  uage are of three typer, vie.,             filing    fees,p;mgdlng
f ee8 and fees for maklng oertlfied               copies.            m
ample - a filing        fee la required        for eaoh presentation,
application       for permit,     petition     for formation      of a
district,     applioatlun       for approval      of bond IafJue, ap-
plioatlon     for adjustment        or fixing     of rates,    and appli-
cation     for extension      of time.      A recording      fee 18 re-
Hon.   E. V. Spence      - Page 5 - v-803

quired     for the filing        of any .instrumeBt         which is
recorded      In, the office       of the Board:         A ~fee is also
provided      for certification         by the Board of any ‘in.-
strument      or map dealred        to be certified.          In addi-
tion to the above fees,             Article      753'2pr~ovides for a
use fee, also to be collected                 for the,benefitof
the State,       such fees being required             for the us,e of
water for Irrigation,            for hydraul.i,c      power, for parks,
pleasure.,, resorts and game preserves                and th,e amoun.ts
in which these fees are payable                  are based upon the
volume of the proposed            power or water consumption.
In conclusion,        Article      7532 provides        that “the fees
paid upon application            for a permit        other thanthe
filing     fee herein      provided,,shall        be held~ by the
Board until       said application          is passed upon and If
same is not granted,           such fees shall          be returned    to
the applicant        therefor.       . . .”
            Article   7533, V. C. S., provides     that the
fees Andy charges    collected    by the Board of Water
EnglneerB,Bhall     be’ immediately    deposited in the State
Treasury   to the credit      of the General Revenue Pund.
               Article   7535, V. C. S., merely allows an
installment       method of payment when the fees exceed
the Bum of $l,OOO.OO, and has ‘no real bearing        on the
subject     involved    herein.
               Where this office          has held that a particu-
lar State agency need not pay the fees,                   this Is
necessarily       also a holding        that,    In drawing the sta-
tutory    provisions       dealing     with feea,     the Legislature
intended      In the first       place to exempt such~ agencies.
It conslatently        follows      therefore     that the Legis-
lature     did not Intend for Article             ~7501 to have a
mandatory      effect    so as to requlre,ln          these excep-
tional     cases the collection           by ,you of the fe,Fo;f;+$
to your taking        action     on the application.
words, Article        7501 is not mandatory           as to those
agencies      which are not required           to pay fees.
            Generally,   thls,anBwepB    your question.  How-
ever,  in order to fully      reply,  It is necessary to
solve certain    problema raiBed by the above opinions
of this offlce~.
          Excluding Opinion No. O-4304 dealing   with
LCRA and Opinion Ro.O-7338 dealing  with UCRA, the
ultimate conclusion  of the above opinions Is that the
Hon.   E. V. Spence      - Page 6 - V-803

fees are not payable         In two Instances:        (1) If
the receipts     of an agency go into some State               fund
and, because      the feea go Into a State          fund, the
agency la exempt;        (2) Where the subject         matter
under the control        of the agency la State property,
such as fish,       the water required      for the protec-
tion thereof     being also State       property,      no fee
is required.       Up to the time of Opiniona            O-4304
and o-7338, the foregoing were the principal,                   if
not only,     two bares upon which exemption             could be
allowed,     Although we have excepted           these opinions,
actually    they form no basis upon which a prospec-
tive exemption        can be allowed.      The holding       of
theae opinions        is merely that the Districts           require
no permit,     obtain no right      under It, and, being
able to spend thelr         funds only in furtherance           of
the statutory      purposes     for which they were created,
are legally     unable ‘to pay the feea.
             It appears   from the statement      of facts
contained    In your letter    that In order to finance
its North Conoho River Flood Control          Project,    It
la neoeaaary    for UCRA to acquire       the usual permit
forming   the basis    of an approprlatlve     water right.
It la evident    that UCRA requires       for a ;;ryhrectl-
oal reason a permit      In thlr   lnatanoe,
Dlatrlota    require a permit, it la no longer         an ana-
wer to the question      of payment of fees to say that
;;oauae   they do not require      it they cannot pay for
    .
          An examlnatlon of the Acto of Upper and
Lower Colorado River Authorities will show that
thalr    aota are nearly  l4entloal.     See LCRA, Aota
1934, 4 C.9. oh.71 UCRA, Aota 1935, o ;Edi and
8mendmentai    [both Aota are oarrled     in %
followln     Artiole 8197f).     With one minor*e;oeptlon,
Section Is of both Aota contains      this Identical pro-
vision (from UCRAla Aot)r
              "~Seo.8.     The Board shall establish
       and oolleot rate8 an4 other ohargerr for
       the sale or uae of water, water oonneotlona,
       power, eleotrlo      energy or other services
       sold,  furnished,     or supplied   by the Dlatrlct,
       whioh fee8 and charges shall         be reasonable
       and nondlaorlmlnatory       and sufflolent     to
       praduoe revenuea      adequate,   in addltlon     to
       funds received     from tax diversion;
,

    Hon.   6. V. Spence     - Page 7 -v-803

           ‘l(a)    to pay all expenses    necessary
           to the operation      and maintenance     of the
           propert?es     and faclllties    of the District;
           “l(b)     to pay the Interest  on and
           principal     of all bond? Issued under this
           Act when and aa the same shall      become
           due and payable;
                   “l(c)    to pay all    sinking  fund and/or
           reserve      fund payments     agreed to be made
           In respect       of any such    bonds, and payable
           out of such revenuea,          when and as the
           same shall       become due    and payable;  and
                   ’ 1(d) to fulfill  the terms of any
           agreements     made with the holders  of such
           bonds and/or with any person in their
           behalf,
                  "'Out of the revenues          which may be
           received     in excess of those required           for
           the pur oBes specified         In subparagraphs
           (a)    (bP     (c) and (d) above,       the Board
           may’ln iis discretion         establish    a reason-
           able depreciation       and emergency       fund, or
           retire    (by purchase     and cancellation        or
           redemption)       bonds issued under this Act,
           or apply the same to any corporate              purpose.
                  “‘It la the Intention    of this Act
           that the rates    and charges   of the District
           shall   not be In excess of what may be
           necessary   to fulfill   the obligations   im-
           posed upon It by this Act. , : .I”
                   The same degree of slmllarlty         existing   be-
    tween the Colorado Acts does not exist              between them
    and the Brazos River Reclamation             and Conservation
    District    ‘8 Act.     For the~most part,      these differences
    lie In language       employed rather      than in substance.
    Substantially,       and eepeclally      as regards    district
    objectives      and functione,      the Acts are the same.
    With respect       to revenues,     the Brazos Act (Acts 1935,
                   ch 368 sec.6         copied V.C.S. following
    ~~~l%~‘&&+)          p&Ides     4s follows:
                 “lSec.6. It Is contemplated    by this
           Act that the Brazos River Conservation     and
                                                                     .

Hon. E, V. gpence - Page 8 - v-803

     Reclamation     Dletrlct     will apply for and
     receive   the cooperation         of the United
     States   of America in alleviating              the
     public   calamity     herein declared,          and
     that beneficial       usea may be found for
     the flood waters        impounded, which are
     hereby deolared       incidental       to the purpose
     OS removing said public           calamity,       and that
     revenue0 will be derived            from euch lncj-
     dental benefits;        all of which, to ether
     with the funda hereby donated and 7 or
     granted   shall    be used during the, time
     and for the purposes         herein      specified,      to
     the end that such publlo calamity                 may be
     averted,      Until all obligatione            herein    au-
     thorized    have been fully         discharged,       the
     tax money hereby donated and/or                granted     to
     the District,      together      with the net reve-
     nues as herein        defined    accruing      to the
     District    from any other oourceB whateoever
     shall    be used exclualvely        for the purpoae
     of diachargrng       aaid obligations      and for
     the proper     operation     and maintenanoe     of
     the l.mprovemente proposed. to be oonetruct-
     cd; but after      all of such obligations        have
     been paid in full,        then the revenuee      ac-
     cruing    to the District       rrom all aourcea
     whatsoever,     shall    be ured by the Dietrlct;
     %irst,    to pay the rearonable oost ot ool-
     leoting    suoh revenuesi second, for the coat
     of the operation,     maintenanoe, depre-
     oietlon, replaoement     and betterment of the
     propertler    aoquired and oontrolled   by the
     Dsstrioti    third, for the oompletlon of
     the neoesoary unit0 of the coordinated
     oonneoted aystem by water oonservation
     that will prevent the pub110 oalamity       de-
     clared    to exlsti  and the balanoe  of such
     revenues ahall be paid annually,      not later
     than Wlroh 18t of eaoh year, to the Treas-
     urer of the State     of Texas and by him
     plaoed     in a Oeneral      Revenue     Fund.
           “The term ‘net revenue’    as ueed in
     this Act shall be construed     to mean the
     revenuea of the Dlstrlot,    from whatsoever
     aouroe derived remaining after the pay-
     ment 0r all oosts 0r oolleotion,     all coat0
     of operation       and maintenance,         depreoiatlon,
Ron.   E. V. Spence       - Page 9 - v-803

       replacement      and betterment       of the prop-
       erties     owned and/or     acquired    and/or
       controlled     by the Dlatrlct,        and the es-
       tablishment      and the maintenance         of an
       adequate     depreciation~and        emergency
       fund sufficient        to construct,      replace
       and/or repair       works, and/or properties
       when and If necessary.”
               Instead      of llmltlng     net revenue       to opera-
tional     coat and providing that net revenue                  over and
above these costs may be devoted                  in furtherance        of
statutory      purpose,      as was done in the Colorado Acts,
the Legislature         has made provlalon           in the Brazos
Act for turning         net revenue      to the Qeneral Fund.
This difference         In method of diaposlng            of net reve-
nue should create          no dfatinctlon,         elnce all three
Districts      are conservation         and reclamation         districts
created     pursuant      to Section     59, Article       XVI of the
Constitution;        and under no circumstances             would they
be authorized        to produce a profit            over and above
conetitutlonal         and statutory       coats.       As a practical
matter,     of course,       year to year revenues          might not
exactly     equal such costs and as to any net revenues
80 produced some provision              wa8 necessary.          In pro-
viding     on the one hand that theae net revenues                    be
put back to corporate            purpose and, on the other,
that they be put In the Qeneral                Fund should not
create     a distinction       which can ‘have any material
bearing     on the fee question          here involved.
              The Colbrado and Brazos District8        were cre-
ated pursuant      to the ooneervation amendment to the
Constitution,     Sec. 59, Art. XVI. A casual         reading     of
the Acts reveals       that the Districts     were intended     to
acoompllsh     the same pub110 purpose.         This elmllarltg
has been recognized        by our Supreme Court.      See Brazos
River Conservation        dc Reclamation  District   v. Mccraw,
126 Tex. 506, 91 S.W.2d 665, 672; and Lower Colorado
River Authority      v. Mocraw, 125 Tex. 268, 83 S.W.2d 629.
             In v5ew of this slmllarlty           and because      of
the absence    of any subntantlal        difference      of result      in
the handling     of net revenuea, ab that difference               re-
lates  to the fee question,       we are of the opinion            that
the came exemption      accorded    the Brazos District          should
be accorded    the Colorado     Districts.        Believing    this
to be sufficient     reason for exem tlon,          we withdraw
Opinion O-4304 and Opinion O-733 8 and substitute                  ln-
                                                                            - .   ,..

          Hon. E. V. Spence     - Page 10 - V-803

          stead this oplnlon.    A copy of this opinion   has been
          furnished   the Upper and Lower Colorado  River Authorl-
          ties   to apprise them of this action.
                       As Indicated   earlier,   Article     7501 1s not
          mandatory    as to those governmental       agencies   found
          to be exempt from the payment of fees.             Such Article
          Is not mandatory      as to the Upper Colorado River Au-
          thority    and you may rile    and consider     Its appllca-
          tlon although    not accompanied     by the fees provided
          by Article    7532.

                             The Board of Water Engineers
                      may file     and consider     an approprla-
                      tion application       filed   by Upper Colo-
                      rado River Authority         even though such
                      application     1s no,t accompanied      by the
                      feea prescribed b$z rtlole         7532,V.C.S.
                      Opinion8 O-4304 an’8 O-7338 by prevlous
                      administration     wlthdrpwn.

                                                 Yours   very   truly
                                            ATTORNEYOENERU OF TEXAS

      I                                     BY       H. D. Prueti,.Jr.
.:,                                                             Asslstant
          HDP:bt

                                    .:. .