Court Opinion

ID: 4133559
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:39:27.617746+00
Date Added: 2024-06-11T13:09:25.286166
License: Public Domain

Honorable Robert S. Calvert           Opinion No. M-1110
Comptroller of Public Accounts
State of Texas                        Re:   Exemption of Arlington
Austin, Texas 78701                         Park Corporation from
                                            franchlee tax under
                                            Art. 12.03, Title 122A,
Dear Sir:                                   Taxation-Genera1,V.C.S.
     You have requeated an official opinion on the following
quoted matter:
        "The Arlington Park Corporation was Issued a
        Certificate of Incorporation on April 7, 1971
        under the Texas Non-Proflf Corporation Act
        (Article 1 96, Revised Civil ,Statutesof Texas,
        a8 amended3.. The corporation was organized
        at the Instance of the City of Arlington for
        the purpose of providing sports events, other
        entertainment and recreation for the citizens
        of Arlington and others. Its primary activities
        Include the operation and management of Arling-
        ton Stadium, the home of the Texas Rangers
        major league baseball team, and Seven Seas, a
        recreational sea-life park. The stadium and
        park belong to the City of Arlington. It
        apparently is anticipated that significant
        profits will be generated by the business acti-
        vities of this corporation, which profits will
        be transferred to the City of Arlington for
        Its exclusive use.

         "The Corporation has requested exemption from
         payment of the franchise tax under Article 12.03
         of the Franchise Tax Act on the baeis that it
         is a 'corporation having no capital stock and
         organized for the exclusive purpose of promoting
         the public interest of any county, city, or
         town, or other area within the state'. Copies

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Honorable Robert S. Calvert, page 2,        (M-1110)

          of the Articles of Incorporation, the by-laws
          and the Lease-Operating agreement between the
          corporation and the City of Arlington are en-
          closed.
          "Your opinion is respectfully requested whether
          the Arlington Park Corporation qualifies for
          exemption under Article 12.03 of the Franchise
          Tax Act."
     From a study of the material accompanying your request, and
in particular, Article eight of the Articles of Incorporation,
we have concluded that the corporation Is organized without mem-
bership or capital Stock, Is non profit sharing, and that the
exclusive purposes and proposed operations of the corporation,
as expressed In its franchise and agreement with the city, are
substantially in accord with the purposes and QrOQOSed activi-
ties summarized in your request.
         Article 12.03, Title 122A, Taxation-General, Vernon's Civil
Statutes, exempts from the imposition of the franchise tax "any
corporation having no capital stock and organized for the exclu-
sive purpose of promoting the public interest of any county, city,
or town, or other area within the state." This exemption is ap-
plicable     to any corporation organized and operating within its
terms,     regardless of the engendering of profits by such opera-
tions.
     Consequently, it is the opinion of this office, from the
facts presented, that the Arlington Park Corporation as orga-
nized, qualifies under the terms of Article 12.03 for exemption
from the imposition of the franchise tax if it is operated solely
Ilforthe exclusive purpose of promoting the public interest."
We furnish herewith a copy of Attorney General's Opinion No. c-76
(1963) which delineates the elements necessary to justify exemp-
tion under this Article.

                           SUMMARY
          The Arlington Park Corporation, having no
     capital stock and organized for the exclusive Qur-
     pose of promoting the public interest of the City

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   .        r

Honorable Robert S. Calvert, page 3,          (M-1110)

        of Arlington, TeXaE, is  entitled to exemption under
        Art. X.03,  Title 122A, Taxation-General, V.C.S.
        from imposition of the franchise tax if it Is oper-
        ated solely for the exclusive purpo'ire of promoting
        the public interest.
                                              very    truly,
                                                        p?,
                                                      @/,&G
                                                     . NARTIN
                                                     eneral of Texas
Prepared by Bob Lattlmore
ASSiStant Attorney General
APPROVED:
OPINION CONNITTEE
Kerns Taylor, Chairman
W. E. Allen, Co-Chairman
James Quick
Bill CaIIIQbell
Kenneth Nordquist
Joseph Sharpley
SAMUEL D. MCDANIEL
Staff Legal ASSiStant
ALFRED WALKER
Executive AEEiEtaIIt
NOLA WHITE
First ASSiStant

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