Court Opinion

ID: 4136448
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:13:43.677641+00
Date Added: 2024-06-11T14:22:33.520825
License: Public Domain

Mr. E. N. Jones, President           Opinion No. WW-531
             Texas Techno&oglcal-College
             Lubbock. Texas                       Re: Whether certain property
                                                      owned by Texas Techno-
                                                      logical College In Carson
                                                      County isexempt from
                                                      taxation under,~thelaws
             Dear Mr. Jones: .'                       ~of the.State of Texas. :.j ~
                  We quote .fromyour ,opinion re2qu&t -as f++vs:-   .,I
:.
                       "Yin&~~oplkLo~
                       "Yin&oplkLo~ Is respectfully requested as to
        .’        whether cer,talti
                                  property owned by Texas Technological
                  College In
                          in Cakon ~County is exempt from,taxatlon
                                                     from,taxation under
                  the laws ofO$he State cf'Texas.
._,..

                       "The property was originally the PanTex Ordnance    ~~
                  Plant and was .deed@dby:the Federal Government tom.
                  Texas Techi.onApril'l, 1949 by deed without warranty
                  for t&purpose   df.edtlcatlonalutil+zation. The deed          .
                  contained~a recapture clause in event of a national
                  emergency.
                       "During t:?eKonean emergency In 1951 and l%Z!, the
                  Government,exercl,sedthe recapture clause and recaptured
                  approximatWy lO;OCO,acres of the 16,000~,with improve-
                  ments, originally .deededto the College. A period of
                  negotlatlops.began'and culminated In the instruments
                  dated August 19, 1955 whioh have been sent to your office.
                       "For the.sake.of clarity, the prop&y   till be
                  divided Into two-clas~lflcatlons, with a description
                  of each:
                            "PROPERTY HELD PURSUANT TO THE
                                 EDNATIONAL USE PLAN
                       "This propeky was.conve$ed to T&as Tech'by the
                  United States Government forka period of twenty years
             ..
                  on April 1, 1949 on tte contentlon (sic) that such   l

                  property be used In compliance with an Education Use
                  Plan which was established by the General Services
                  Administration, has been revised, land Is now under
                                                                   :   ”

          Mr. E. N. Jones,   page .2,         Opinion No. WW-531

              the jurisdiction.of the Department of Health, Education
              and Welfare. If the property Is not operated strictly in
              accordance to such plan, the United~States Government may
              re-take it for non-compliance any time within the remaining
              years of the twenty-year period in keeping with the reversion-
              ary clause in the Amended:Deed. 'At the end of the twenty-
              year period, Texas Tech will own the property outright.
                       "The majority of this property is either under
              cultivation or being used for the grazing of experi-
              mental herds owned by Texas Tech. Texas Tech keeps a
              full-time crew~on the property for the purpose of
              maintenance and to aid in research. One particularly
              outstanding research project presently being conducted
              is the bull progeny tests..;Faculty and students are
              brought-up from~Texas Tech's main campus to study and
              observe the work being conducted.
                       "Four buildings,located'on the aforesaid property
              are temporarily excess to the needs of Texas Tech in
              its operation pursuant to the Education Use Plan.
              Three of these buildings are being leased to Phillips
     .-       Chemical Company and the other to one of their employees
              by Texas Tech for and with the.permission of the Depart-
              ment of Health, Education and Welfare. It is contem-
              plated that as ~the educational program expands, this  .
              property will be used.in connection therewith and is '.
              being held for the purpbse.

    . .                 "PROPERTY OWNED OUTRIGHT BY TEXAS TECH
                        "This property 1s~owned outright by Texas Tech,
               having been purchased from the United States Government
               by use of accumulated amortized credits. TL:emajcrit3
               of this property is rented to&e   Phillips Chemical
               Company for storage purposes. Phillips rents three
               warehouses on a five-year basis and it rents one hundred
               and two (102) igloos on an 'as-needed basis,' paying
               only for the'igloos actually.used. Certain staff
               residences located on'this property are rented to indivi-
               duals on a month-to4month tenancy. Certain buildings,
               located on sald ~prop,erty,
                                        and.known as PanTex Village, are
               owned by Carson County.' Texas Tech leases the land
               under such buildings to the'county
                                               :  on a year-to-year
               basis for $1.00. .~
                        "The income from'all of the aforesaid rentals is
               credited to the.PanTech Farms'Account and Is used solely
               for the promotion,of the educational program at PanTech
                       47
                               '.              _~,

.

                                                                           :   .
.   /

        Mr. E. N. Jones,         page 3,                Opinion No. WW-531

            Farms in Carson.County. It is contemplated that this
            property will be eventually needed as part of the PanTech
            Farms operation pursuant to the Education Use Program
            and is being held for such future use."
             It is the opinion of the Attorney General that all of the
        above-described property is exempt from taxation under the
        laws of the State of Texas.

                          PERTINENT STATUTORY AND CONSTITUTIONAL PROVISIONS
             Article 8, Section 2 of the Texas Constitution contains
        the foll,owinglanguage:
             II . . the legislature may, by general'laws, exempt
             from taxation public property used for public purposes;
               . . bng   all buildings used exclusively and owned
             by persons or associations of persons for.school pur-
             poses. . . .'
             The provisions of the aforesaid Article are permissive
        and not mandatory. #Pursuant thereto, the legislature enacted
        Article 7150, Texas.kevised Civil.Statutes, the. salient pro-
        visions of which read as follows:
             "The following property shall be exempt from taxation,~
             to-wit:
            "1. Schools and.Churches. -- Public school houses, . . .
            ~A11 public colleges,~public academies, and all endow-
            ment funds of institutions of learning and religion
            not used with a view to profit, and when the same are    ..
            Invested ,in bonds or mortgages, and all such buildings
            used exclusively and owned by persons or associations
            of persons for school purposes;  ~ . .‘I~
             II
                  .   .   .

             " 4. All property, whether real or personal, belknging
             exclusively to~thls State, or any political subdivision
             thereof. . .I'
                                           GENERAL DISCUSSION
             The exemption of property used for school purposesapplies
        to private schools as well as public schools. Cassi'anov.
        Ursuline Academy 64 Tex. 673 j1823). However, 5he exempfion
        accorded nrsivate schools ismze  restrictive than the exemp-
        tion given to public school houses 9 public colleges and public
     Mr. E. N. Jones,   page 4, '           Opinion No. WW-531

     academies. Chief Justice Stayton pointed out this distinction
     inthe case of St. Edward"s College v. Morris, Tax Collector,
     17 S.W. 512 (Tex.Sup.Ct. 1851):
              "In reference to the exemption from taxation of
         property, when used exclusively and owned by persons
         or associations of personsfor school purposes, the
         statute simply repeats,the~language of the Constitution
         which permits th,eexemption to be made; thus indicating
         an intention to make the exemption in such cases more
         restrictive than is the exemption when given to public
         school-houses, public college6 and public academies.
         The Constitution, aswell as the statutes, make the-
         distinction between public property and private property
         owned and used for school purposes. . .'
          Texas Technological College.was created and is governed
     by the laws of the State of Texas. It is a public college.
     Its property is public property of the State of Texas, and
     is held bv Texas Technological College as an agency of the
     State of Texas. See State v. University of Houston 264 S.W.
2d 153 (Tex.Clv.App. 1954, N.R.E.)
          The test for determining whether public property is tax
     exempt because used for a "public purpose" is whether it is
     used primarily for the health, comfort and welfare of the
     public. A. & M. Consolidated Independent School District v.
     City of Bryan> lo4 S.W.'2d 914 (Tex.Sup.Ct. 1945). Fublic
     education is recognized as a function of State government.
     Cassiano v. Ursuline Academy, supra. There can be no doubt
     that the maintenance of a public school is a public purpose
     as envisioned by Article 8, Section 2, Texas Constitution.   5
     Therefore, this opinion is concerned with the exemption ac-
     corded to "public property used for public purposes" by
     Sectiornl and 4 of Article 7150, Texas Revised Civil Statutes.
          From >,                              supra, we quote:
          "Public schools, colleges, .and academies may,,,under
          authority of law, be established for the purpose'of
          giving Instruction In . . : agriculture, or other
          pursuit, which can be done practically only by having
          lands which may be used for the purpose of giving
          practical instruction, and in such a case all the
          buildings and land used for such a purpose would evi-
          dently be exempt."
     On the authority of this case it is apparent that all the
     property described as "Property Held Pursuant to the Educa-
     tional Use Plan," (with thenexception of the four buildings

‘.
                                    “I
   .,   .

Mr. E. N. Jones,    page 5,                Opinion No. WW-531

which are temporarily excess to the needs cf said plan and
which are being rented) is exempt from taxation.
     The exemption accorded to "public pr+operfyused for public
purposes" is not lost~even though such property may be temporarily
leased or rented, so long.as the public purpose of the property
has not-been abandoned, and so long as the revenue from
such renting or leasing enures'to the.publlc benefit. State v.
City of Beaumont 161 S.W.,2d 344 (Tex.Civ.App. 1942, no writ
history); City of Abi1ene.v. State 113 S.W.2d 631 (Tex.Clv.App.
1938 Error Dismissed.)
     In your letter you state that it Is contemplated that the
property~described as "Property Owned Cktright by Texas Tech,"
and the four buildings listed under "Property Held Pursuant to
the Educational Use Plan" which are temporarily excess to the
needs of such plan, will eventually be used in connection with'
the educational use plan .and are being held for that purpose.
You further state that the Income from all rentals Is credited
to the PanTech Farms Account and is used solely for the pro-
motion of the educational program. It Is therefore apparent
that the property described as "Property Owned Outright by Texas
Tech" and the four rented buildings listed under "Property Held
Pursuant to the Educational Use Plan" are also exempt from
taxation.

                 The properly held by Texas Technological
            College pursuant to the Educational Use Program
            Is exempt from taxation under the laws of the
            State of Texas on thengrounds that such property'
            Is the property of a public college used in con-
            nection with'the college's educational program.
            The remainder of~the.property is also exempt
            from taxation under the 1aws::ofthe State of
            Texas though temporarily leased or rented by
            reason of its being public property "held" for
            public purposes, since the public purpose of
            such.property has not been abandoned and all
            revenues therefrom enure to the benefit of Texas
            Tech and are used solely for the provotion of
            the educational program at PanTech Farms.
Mr. E. N. Jones, page 6,                    Opinion No. WW-531

                              Very truly yours,
                              WILL WILSON
                              Attorney General of Texas

                           ,~
                            zii15iIr P&-L--u
                                Assistant Attorney General
JNP:db
APPROVED:
OPINION COMMITTEE:
Geo. P. Blackburn, Chairman
C. Dean Davis
B. H. Timmins, Jr.
L. P. Lollar
Henry G. Braswell
REVIEWED FOR THE ATTORNEY GENES&

m:   W. V. Geppert                 .'