Hon. Tom L. Hartley                  O$nion No. O-2637
Criminal District   Attornev           : Exemption from state and
Hidalgo County                       county taxation of land owned
Edinburg, Texas                      by the Regional Agricultural
                                     Credit Corporation of Washington,
                                     D.C., as an agency or instru-
Att :    Mr. H. H. Rankin, Jr.       mentality of the federal govern-
                                     ment created under the Emergency
                                     Relief and Construction   Act of
                                     1932, Section 201 (e)   Ch. 520
                                     47 Stat. at L. 709, 713, 12 US&A,
Dear Sir:                            Section 1148
          We have y,our letter of August 14, 1940, in which you
ask our opinion on whether land owned by the Regional Agricul-
tural Credit Corporation of Washington, D. C., is exempt from
state and county taxes.
           We believe that it is clear that the Regional Agri-
cultural Credit Corporation  is an instrumentality of the United
States.   It is created under authority of 12 USCA, Sectionll48,
which reads as follows:
               "The Reconstruction      Finance Corporation is au-
        thorized to create in any of the twelve Federal land-
        bank districts     where it may deem the same to be de-
        sirable a regional agricultural         credit corporation
        with a paid-up capital       of not less than $3,000,000,
        to be subscribed for by the Reconstruction            Finance
        Corporation and paid for out of the unexpended bal-
        ance of the amounts allocated         and made available     to
        the Secretary of Agriculture        under section 602 of,
        Title    15.   Such corporations     shall be managed by
        officers     and agents to be appointed by the Farm Credit
        Administration under such rules and regulations            as it
        may prescribe.      Such corporations      are hereby author-
        ized and empowered to make loans or advances to farm-
        ers and stockmen, the proceeds of which are to be used
        for an agricultural      purpose (including      crop produc-
        tion)     or for the raising,     breeding,   fattening    or
        marketing of livestock,       to charge such rates o h inter-
        est or discount thereon as in their judgment are fair
        and equitable,     subject to the approval of the Farm
Hon. Tom L. Hartley,    page 2   (O-2637)


     Credit Administration,     and to rediscount with
     the Reconstruction   Finance Corporation and the
     various Federal reserve banks and Federal in-
     termediate credit banks any paper that they
     acquire which is eligible     for such purpose.    All
     expenses incurred in connection with the opera-
     tion of such corporations     shall be supervised and
     paid by the Reconstruction     Finance Corporation
     under such rules and regulations      as its board of
     directors  may prescribe.”
             It will be noted that all of the stock of the Regional
Agricultural    Credit Corporation is owned by the Reconstruction
Finance Corporation,     which in turn is created by the act of Con-
gress 15 USCA, Section 601 and is wholly owned by the United
States of America.      15 US& Section 602.      The activities     of the
Regional Agricultural      Credit Corporations  are directed    either by
the Reconstruction     Finance Corporation or by the Farm Credit Ad-
ministration.      It therefore   follows that the Regional Agricul-
tural Credit Corporations       are agencies or instrumentalities     of
the United States.      Keifer & Keifer vs. Reconstruction      F~B.~ICQ
prporation,     306 U.S. 381, 59 S.Ct. 5 6 83 L.Ed. 784
 sri ultur al Credit Cornoration vs. Siev?ar$, (North
N.~.~801.
            Even though the Regional Agricultural    Credit Corpora-
tion is an instrumentality     of the United States, it does not
necessarily    follow that its property is exempt from state or
county taxation.      Congress may provide that the property of a
federal   instrumentality   may be taxed and “,pi ;aigVe ~vimmunity
which might otherwise exist.      Balt more N I n 1 an      9. State
Tax Cm            , 297 U.S. 209, 56 S&t. 417, 80 L.Ed. 586.
            In this connection,   it is our opinion that Section 4
of llrticle  7150, Vernon’s Annotated Civil Statutes,     which exempts
from taxation “all property . . . of the United States.        . . ” was
intended to exempt only property owned directly       by the United
States or property of a federal     Instrumentality   where no consent
has been given to its taxation,     and was not intended to exempt
property of a federal   instrumentality    where consent to its taxa-
tion has been given by Congress.      The property in question here
does not come under the provisions      of Article  5248 Vernon’s
Annotated Civil Statutes,    which exempts property oi the United
States used for certain purposes set out in Article       5242, which
are not involved here.
            In our opinion    Congress has consented to the non-dis-
criminatory   taxation of i and belonging to Regional Agricultural
Credit Corporations.     We reach this conclusion,   first, because
Congress has expressly     consented to the taxation of the land of
Hon. Tom L. Hartley,    page'3 (o-263?),        ,   '


Reconstruction   Finance Corporation   and, second,;because   by
clear implication,   the,same consen E is extended~to the taxa-
tion of the land..of Regional Agricultural   Cred~it Corporations.
          Congress, in 15 USCA, Section 610, provided generally
that the property of the Reconstruction  Finance Corporation
should be exempt from state and county taxation;but    expressly
consented to the taxation of its real p'roperty in the following
language:
           '1. . . except that any r,eal property of the
     corporation   shall~be subject to State, Territorial,
     County, municipal     or local taxation to,the  same.
     extent according to its value as other real property
     is taxed.    Jan. 22, 1932, C. 8, g 10, 47 Stat. 9."
            Congress, however, has made no express provision     as to
the taxation of the property of Regional Agricultural     Credit
Corporations.    The question is therefore  presented as to whether
Congress intended that'the' same liab'ility  to taxation of their
real property should apply to Regional Agricultural     Credit Cor-
porations as to Reconstruction   Finance Corporation.
            We believe that the history of the legislation        relat-
ing to Reconstruct,ion   Finance Corporation and Regional Agricul-
tural Credit Corporations,    'indicates   the legislative   intent.     By
the act of January 22, 1932 -47Stat. 5, 15 USCA 601, et seq.,
Congress created i?econstruc$ion     Finance Corporation,    and by Sec-
tion 10 of this 'act (15 USCA, Section 6101, It was provided that
the real property of Reconstruction       Finance Corporation could be
taxed as quoted above.     Section 2 of this act (15 USCA, Section
602) provided that of the $500,000 000 appropriated        to the Re-
construction   Finance Corporation,     ~5Q,OOO,OOOwas allocated      to
the Secretary of Agriculture     for the ~purpose of making loans or
advances to farmers.     By the act of ,July 21, 1932, co 520, 47
Stat. 709, certain sections     of the statute relatingto       Reoonstruc-
tion Finance Corporation were amended; and by Section 201~ (e) of
this act (15 USCA, Sect~ion~1148, quoted above) Reconstruction
Finance Corporation was authorized to create Regional Agricultural
Credit Corporations    for the purpose o,f administering     its funds
allocated. to the Se,cretary of Agriculture.
            Itis    reasonable to' assume that fin providing in, a single
section'of   the statute for,the      creation of Regional Agricultural
Credit Corporations      asa means of facilitating    the performance
of the functions     of Ae.construction Finance Corporation,    Congress
assumed that the .exempti:ons and liabilities      of Reconstruotion
Finance Corporation would? flow to th.e Regional Agricultural         Credit
Corporations     so created and wholly owned by Reconstruction       Finance
Hon. Tom L. Hartley,     page 4    (O-2637)


Corporation.   In connection with the liability of Regional Agri-
cultural Credit Corporations  to suit, the Supreme Court of the
United States said in the case of Keifer & Keifer vs. Recon
                              , 306 U.S. 381, 59 s.ct.  516,~ 83

            “Reconstruction     is the parent of Regional. When
      creating it, Congress gave Reconstruction          various
      general corporate powers including authority           ‘to sue
      and be sued to complain and to defend           in any court
      of competen $ Juri;di;“,;onAt   stLat; o; f ,e$e;ali 1 l$ Jan-
      uary 22, 1932
      U.S.C.A. B 601. When liter       C&gsesi    authr&ed       Re-
      construction   to create these Regional Agricultural
      Credit Corporations,      it did so by outlining     in a sin-
      gle section of a comprehensive statute the broad
      scope of this added power for Reconstruction.             (July
      21 1932) 47 Stat. at L. 709, 713 chap. 520, 12
      U.4.C.A. S 1148.      Congress naturally    assumed that
      the general corporate powers to which it had given
      particularity    in the original   s~tatute establishing
      Reconstruction    would flow automatically      to the Re-
      gionals from the source of their being.”
          We believe that the reasoning of the Supreme Court
quoted above is applicable  to the situation   presented here.
Having determined that real property directly    owned by Recon-
struction Finance Corporation  should be subject to taxation as
other real property,  Congress had no reason for exempting from
taxation property owned by a corporation    which is created and
wholly owned by Reconstruct ion Finance Corporation.
             We further believe that this conclusion           is supported
by a general Congressional        policy to permit the taxation of real
property belonging to similar federal           instrumentalities.     Con-
sidering only corporations        exercising    closely   similar functions,
we find that as to the following          corporations   Congress ‘has per-
mitted local taxation of real property:             Federal Intermediate
Credit Banks, 12 USCA Sections 1111, 931; Federal Land Banks
and Joint Stock Land Banks, 12 USCA Section 933; National’ Agri-
cultural    Credit Corporations,      12 US&A, Sections 1261 548; Pro-
ductlon Credit Corporations,         Production    Credit Assoc 1atlons,
Central Bank for Cooperatives          and Regional Banks for Coopera-
tives     12 U.S.C.A.     Section 1138 (c); Federal Farm Mortgage Cor-
porations,    12 U.S.E.A.,     Section 1020 (f); National Mortgage
Associations,     12 USCA, Section 1722.        As the Supreme Court said
in the case of        ifer & Keifer vs. Reco t uction Finance Cot-
poratiqp,    306 U%. 391, 59 S.Ct. 516, 8yLtEd.            784 , 791:
Hon. Tom L. Hartley,    page 5   (O-2637)


                     To imply for Regionals a unique legal
     positi&‘c:mpared     with those corporations     to whose
     purposes Regional is so closely     allied,    is to in-
     fer Congressional    idiosyncrasy.   There is a much
     more sensible explanation for the failure        of Con-
     gress to bring Regional by express terms within its
     emphatic practice    not to confer sovereign immunity
     upon these government corporations.         Congress had a
     right to assume that the characteristic        energies for
     corporate enterprise     with which a few months pre-
     viously it had endowed Reconstruct ion would now
     radiate through Reconstruction     to Regional.”
           For the reasons stated, we are of the opinion that
land owned by the Regional Agricultural  Credit Corporation  of
Washington D. C., is subject to state and county taxes to the
same exten E according to its value as other real property is
taxed.
                                  Yours very truly,
                                  ATTORNEY
                                         GENERAL
                                               OF TEXAS
                                  By /s/ James P. Hart
                                  James P. Hart, Assistant
APPROVED:OCT 18, 1940
/s/ Gerald C. Mann
 ATTORNEY GENERAL
                OF TEXAS
This opinion   considered   and approved    in limited   conference.
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