        OFFICE OF THE AlTORNEY      GENERAL   OF TEXAS
                           AUSTIN




Honorable T. M. Trimble, First Assistant
Stste Superintsndentor Xblio Inetruotlon
Austin, Texas
Dear Sir:
                               Opinion f?6. O-3922
                               Ra: Oeoupatlontax on utlllties
          We have reoelved ~yourletter of Au+st 28, 1911,
In whlah you enolose a latter to you from Mr. E. A. Parrin,
Sugarintendantof the Cmaron Public Sohocls. Mr. Parrin's
letter reads In part as follows:
          *The Cameron Bohcol Dlstrlot is a school
     diatrlot In whloh the city haa assumed oontrol.
     The alty tax assessor oollaota our tax, both
     malntenanoe end bond. The olty oounoil turns over
     to our tra&surrr 756 on $100.00 aasaeaad valuation
     for the maintananoa or our aohool. They pay the
     bonded lndebtadnesadirect. Our sohool beard is
     eleotad.
           *The LegislatureHoently approved a special
      tax whlah should be paid to the oity governments
      by the utility oompanies.The eleotrio oompany,
      the water oompany, the gas aompany,.andthe tela-
       hone oompany pay to the,oi,tyapproximately
      {2,500.00 annually. I auppoae this ia an oooupation
      tax.
           "I wish to know Ii the sohoola are entitled to
      partlolpatain this tax and if so, to what extent."
          The Forty-seventhLfqti~latura et Its regular
session passed IIouseBill 8, the Omnibus Tax Law. Artiole
7070, R.C.!?.,as amended by Artiole IV of Rouse Bill 8
levies e State coounationtax on telephone oorcl:?anies.
Eowever, seotion 2 of Artiole 7070, as amended, read8 as
r0ilowf3:
X6norable T. ?J.‘?rIr.ble,
                        yego 2


          *(zi NC city or ottor polItIocrlsubdlvialon
     or t.Elsmxe‘e, by YlTtue or Its texklg wwr,
     :lollaaFewer, or otherwlee,shall Xa~otceau occu-
     pation tax or charge or sny sort, for tha ;*rIvlle@
     0r   Uolnc   ?as%ness,   upon   any    psrcaon,   oor::oPa*ion,
     or a*aociatIozi
                   required to pay an 0oou;ation tax
     under this Art&la; provldrd, that nothlna in thla
     ArtIols aball ba oonatrued to prohlbIt the oolleotlon
     or UC vitlor~~~
                   t&sea as provided or not prohibIted by
     law, or any tax now 1n;poaadby franohisc,and provided
     !‘urtharthat thl8 Artlola ah811 not wrreot any oon-
     treat now in exlstmoe or hereafter nodo butwosn a
     city and the holder of a franchise.*
          rirtielo7060, R.C.“., a8 .monded by Artialo tr
or Rouse 8111 8, levies a state oooupatIoatax on aa8
oaapanlea,eleutr10 light ooqanlee, oleotrio povbs ema-
panles, and water work8 or water end U&t     plant8 boated
in any inoorporatadtonn or olty and uscrdTor looal.aale aml
dl~trtbutlon. ikwever,  the r0u054hg  provltilc4  lp:wara:

           Wo city or other polftleal     mubdlvlsIonof
     this Sate, by virtue of its taxing power
     proprlstary poacr, poUc4 power or othalwr~,
     shall 218~0s~an ooougrtkm tax or ehbrge or my
     eort upon any p er so n,
                            o o r p o r utloo ar i,
                                                 lrao6letlon
     ropuir6d to pay tin ooour&ion tax under this
     Artlolc. ~?othIn~in thi6 Artlale shall ba ooa-
     atrueb am arrecting  In any way the oolleotlon 0r
     ad valorem tnxos authorlaad by law: nor Impalrlng
     or altering In any.way the plwleions        of any
     oontraota,     agr6ementt3,     or   rranahleer    now   in
     lxlstanoa, or horaartortasdebataaen 4 city and 4
     putiio utility, ralatinp,to psyzentr. or any sort
     to a olty. Rothtng  in this Article shall be eon-
     *trued ea ycohlb:tin&an fnoorsoratedolty Or town
     fior mk:ny: a~remonsb1.e oharE6, otimrwlslalawful, for
     thb us6 of its a~troets,alloys, and publlo waye by a
     gub,fIoutmltp In tba conduct of lta buaiWea, and
     each auah oity she:1 have such right and ?owerg but
     any ouch oJxwgea, whether Os~igristsd66 r~ntubi or
Ronarable T. I:.Trlmbie, Pa3 3


          otherwise, end whether measured by gross receipts,
          units of installation,or in any manner, shall not
          in the eg,gregateexceed the equlvelent of two (2)
          per cent of the floss receipts or such utility
          eithln suah municipalityderived from the sale of
          ivs, electric ener'py,or water. Any speclel taxes,
         rentals, aontributions,or char&es accruing after
          the effective date of this Act, under the terms or
          any pre-existingcontrsct or franchise, ageinst any
          utility paying sn occupation tax under this Artlale,
          when paid to any such city, shall bacrcdlted on
          the amount owed by such public utility on any charge
        : or rental~im?osedfor the use ot streets, alleys, and
          public ways, levied by ordinenae, and accruing after
          the effective date of this Act; prov~ldedthat where
         valid ordinances have been enacted heretofore by
          cities imposing 6 charge or rental in excess of two
          (2) per cent of the gross receipts of such utilities,
         nothing herein shall be aonstrued so as to prohibit
         the aolleation of such sums as mey be due said
          cities thereunder from the date of said ordinanaeaup
          to the times this Article shall become errective."
          Thus, we see that the povterto impose occupation
taxes on the businessesnamed in the above mentioned statutory
provisionsie expressly denied to cities or other political
subdivisionsof this stete. It follows that there is no city
tax under these provisions in which the city sohools are en-
titled to'participate.
          &ticla'Xx or House .Blll8 provides for the dls-
position and allooation of revenue derived and collected
under Articles IV and V. One-fourth or such revenue Is to
be deposited with the State Treasurer to the credit of the
Available School Fund. The balance of the revenue la to be
deposlted in a Clearance Fund in the Treasury. Then there
are provisions for the.e~propriation,trensfer, and ellocation
or certecinnmounts of the moneys rro?;the Clearsnce Fund
to the Blind Assistance Fund, the Children AssistanceFund,
                               the Old Age AssistanceFund,
the Teacher Retirement ?ysts.;*:,
and the CXneral Revenue Fund.
Eonortible
         T. X. Trimble, Page 4


          If the statutoryprovisionswhich we have con-
eidered ere not the ones to which you here reference,
please notiry us.
                             Very   truly yours




                        By     Lk@&
ATTORIWY Gq                           Glenn R. Lewis
                                           Assistant
