          ~KEATII-ORN~Y   GENERAL
                 OF v?JcuAs
                      AUWTIN   11. TExAe



                    February 1.6, 1949

Hon. William N. Hensley
Criminal District  Attorney
San Antonio, Texas

Dear Mr. Bensleyr                      Opinion No. V-776
                                       Rer   Several   quest Ions
                                             relating to ren-
                                             dition and assess-
                                             ment of property
                                             for ad valorem
                                             taxation.
           You request the opinion of this       office   upon
the questions  set out below as follows:
            “(1)    What Is the percentage of the
     fair cash market value of property upon
     which a taxpayer may make a sworn rendl-
     tion* In other words, can the taxpayer
     legally     render his property at, say,
     Flg*percent        of the fair cash mai%et

           “(2)  Should the Tax Assesso? ad-
     vise persons making renditions   th.:ct the
     rendition  must be on the true and full
     value that Is to say, the fair cash
     markei value of the property?    Is It the
     duty of the Tax Assessor to tier to the
     Board of Equalization  such r endltions   as
     are not made at the fair cash market
     value?
           “(3) At what percentage of fair cash
     market value may the Tax Assessor assess
     unrendered properties when he makes his
     assessment on such unrendered properties?
           “(4)   At what values can the Board of
     Equalization   set the assessed values of
     property before them for consideration?
     May the Board of Equalization   set a value
     of less than the fair cash market value?
Hon. William    N. Hensley,   Page 2, v-776


        What Is the effect  of the ‘uniformity!    pro-
        vision of the statutes?    In other words,
        may the Board set a value on a particular
        piece of property at the fair cash market
        value while the standard for property as-
        sessments generally   Is at forty percent of
        the fair cash market value?”
             We shall not attempt to answer your questions
categorically,    for as we perceive your primary concern
is:   What significance    is to be attached to the several
constitutional    and statutory  provisions  pertaining to
the value at which property is to be assessed for ad
valorem taxes?
            Preliminary to our discussion      of this ques-
tion,  it may be observed that the duties of the tax-
         the Tax Assessor-Collector       and the Board of
gt%&ation      have been definitely’deflned      by statute.
An excellent    summary from which may be gathered the
narrw function of an “assessment ‘I Is contained in the
case of Cracker v. Santo Consolidated        Independent
School District,    116 S.. W. (2d) 750 (C.C.A. . . . 1938)
expressed in the following      language:
              “Some confusion Is manifest.    . . regard&
        ing the nature and functions     of renditions    of
        property and assessments of property,       particu-
        larly manner of listing    or otherwise evidenc-
        ing rendition   and assessments.
              “It should be borne in mind that a tax-
        payer never assesses his property for taxas.
        Not even a commissionerst    court has author-
        ity t0 a0 that.    The assessment of property
        Is peculiarly   the duty and responsibility    of
        a tax assessor.    The jurisdiction   of the com-
        missioners’ court with r eference to assess-
        ments Is confined to raising or lowering
        assessments as incident to Its duties as a
        board of equalization.     It has no power to
        add property to the tax rolls not previously
        assessed,   nor to take property from them . . .
              ‘#The taxpayer lists  or Inventories  pro-
        perty by describing    it and placing a value
        upon same. He may make the list himself,      or
        merely furnish the information to the assessor.
        If the assessor agrees to the rendered valua-
        tions    he the assessor,  makes the rendered
        valua 4 ion the assessed valuation,   or, If he
Hon. William   N. Hensley,    Page 3, v-776


     does not agree, he Is required to note the
     assessed value on the same list,      subject
     in either case. to final action bv the
     board of equalization     as to &sing     or low-
     ering it.    B. S. 1925, Art. 7211. Thus
     the r enditlon lists   become also assessment
     lists.    When after legal levy such assess-
     ment lists   are corrected and approved by
     the board of equalization     the liability     of
     a taxpayer is thereby fixed.”
              In addition to the provisions .of Article       7211,
v. c. s., other statutory        provisions   direct the Assess-
or-Collector     to transmit to the Commissioners’ Court,
sitting    as a Board of Equalization,       assessments of ren-
dered and unrendered property which have been made to
him. After the .Board of: Equalization          has equalized the
values, the Assessor-Collector          then proceeds to assess
;llcuniSendered    property as required by Article        7218,
      .     * to prepare rolls     or books of all rendered or
&rende&.       real and personal property as required by
Article    7218 and 7219, V. C. S.; on or before August 1
to transmit to the Board of Equalization           his rolls   or
assessment books with his affidavit          attached thereto
in the form directed by Article          7222, V. C. S.; and
the Board of Equalization        after it has examined and
approved the rolls       or assessment books trsnsmlt copies
to the Comptroller,        County Clerk and the Assessor-
Collector     as prescribed    in Article   7224. The Assessor-
Collector’s     tax rolls,    as finally   equalized and ap-
proved by the Board of Equalization          and delivered,
constitute     the assessment upon which the Tax Collector
proceeds to collect        the taxes assessed by the Assessor
and as equalized by the Board of Equalization.,
           We now pass to the question in which we think
you are primarily    interested.    That Is, the standard of
fixing the value upon which taxes are ultimately        as-
sessed and collected.      There are three constitutional
provisions  which should be noted.       Article VIII, Sec-
tion 1, of the. Constitution     provides:
            “Taxation shall be equal and unlf orm.
      All pr~operty. . . shall be taxed in propor-
      tion to Its value, which shall be,,ascer-
      tained m~mav be Drovided bv law.
            Section    11 of the same Article    provided:
            “And all    lands and other   property,   . .
Hon. William    N. Bensley,        Page 4, v-776


     shall    be assessed     at    Its   fair   value.”

             Section   20 of the same Article              provides:
           “No property of any kind in this State
     shall ever be assessed for ad valorem taxes
     at a rester  value than wair        cash
     &JJ~ nor shall any board of equalization         of
     any county or political   subdivision    or tax-
     ing district  within this state fix the value
     of any property at more than its
     market-”
          The following   statutory              provisions     also   deal
with the quest ion of value.
             Article   7149 provides         in partz
           “The term ,ltrue and full value f wher--.
     ever used shall be held to mean the fair
     market value, in cash, at the place where
     the roperty to which the-m      is applied
     shal P be at the time of assessment    being
     the price which could be obtained {herefor
     at private sale, and not at forced or auc-
     t ion sale .‘I
             Article   7174 provides:
          “Personal property of every descrip-
     tion shall be valued at its true and full
     value In money.”
           We think that the apparent confusion as to
value which would seem to arise by these numerous
statutory  provisions     for the guidance of tax admin-
istrative  officials     is dispelled   by the case of West
Texas Hotel Company v. City of El Paso, 83 S- W. (2d)
772 (C. C. A.)      holding that there is no substantial
difference  In 4he terms (1) market value, (2) fair
market value, (3) cash market value, (4) fair cash
market value, (5) reasonable cash market value, and
(6) true and fu3.1 value in money, which terms appear
In various constitutional       and statutory  provisions
pertaining  to value for the assessment of taxes.
Since our courts have held that the various terms
used in the Constitution       and Statutes as a basis of
value for assessing      taxes are synonymous we shall
use for the purpose or this opinion the 4 erm “fair
,




Hon. William   N. Hensley,   Page 5, v-776


cash market value" used in Section 20 of Article     VIII
of the Constitution,   supra, and the term used in
Article   7149, V. C. S., "fair market value in cash",
which clearly   are equivalent terms.   Ko provision
similar to Section 20 of ?rticle    VIII was in the
Constitution   prior to its adoption ,$ugust 23, 1937,
and it did not become effective    under its express
terms until January 1, 1939.
             Clearly,   from the Constitutional    and statu-
tory provisions      above mentioned, it is lawful for the
Tax Assessor-Collector to assess and the Commissioners1
Court to equalize property assessments at the full
cash market value.        If there were not court interpre-
tations to the contrary,        one would conclude from the
above provisions      that ,this was the only legal stand-
ard which could be used.         However there have been
numerous court decisions        which hoid that the ,taxing
authorities    may use'8 lesser value if the standard is
uniformly applied to all taxable property.           Therefore,
in the light of the court decisions,         the taxing auth-
orities    are free to elect whether they will assess and
equalize at the full cash market value or a lesser
percentage thereof,       so long as the percentage is uni-
formly applied to all taxable property.          It is worthy
to note that Section 20 of Article         VIII of the Con-
stitution,    which became effective      January 1, 1939,
does not specifically       forbid an assessment at less
than the fair cash market value, but expressly forbids
an assessment upon a valuation greater than such value.
Uniformity of assessment is the end to be achieved
the absence of which is forbidden by the Constitution.
Our Supreme Court so held in the case of Lively v.
?.fissouri ,Kansas Texas Railway Company of Texas, 120 S.
W. 852, speakin:. through Justice r.::a;rn, in the follow-
ing language:
            "But, as stated before in this opin-
      ion the wrong which was inflicted      upon the
      appellee was not in requiring      it to pay
      taxes upon the full value of its property,
      but In denying to it the equality       of taxa-
                        ;hec Constitution,   %
                          i n n cessa ilv deD n 9
      yoon yniformitv   of assessment."
             n this case the Railroad Company objected
to the 10 4 o valuation upon its intangible assets for
the purpose of assessing taxes against it in Dallas
       :.
                                                         .   1




Ron. William   N. Hensley,   Page 6, V-776


County, which county adopted a 66 2/3$ value applic-
able to property generally  in the County, and in
settling this difficulty,  the Supreme Court said:
            nIn administering   the remedy the
     court must take the course which 1s most
     practical    to secure uniformity     of valua-
     tion of the property to be taxed.          This
     may be done either by Increasing the as-
     sessment of each property owner in the
     county to its full value and to collect
     from each the taxes upon this full value,
     or to reduce the assessment of the intan-
       ible assets of the railroad      company to
     t 6 2/j per cent on the $100 of its assess-
     ed value.     The court will adopt that plan
     which is most feasible     and calculated      to
     secure justice    to the parties.     . . The
     Court is placed in a dilemma, from which
     it can only escape by taking that path
     which while it involves a nominal depar-
     ture irom the letter     of the law, does
     injury to no ane, and secures that uni-
     formity of tax burden which was the sole
     end of the Constitv~tion.     To hold other-
     wise is to make the restrictions         of the
     Constitution    instruments for defeating
     the very purpose they were intended to
     subserve.     It is to stick in the bark,
     and to be blind to the substance of
     things.    It Is to sacrifice     justice   to
     it 9 incident :
           “It would be utterly impracticable   to
     increase the assessment of all other pro-
     perty owners in Dallas County to its full
     value, therefore  a court of equity will
     adopt the other method--reducing   the as-
     sessment made by the state board tomthe
     same proportion  of value as was placed up-
     on the masS of property in the county. . .”
          The principle laid down by Judge Brown in
this case bas not been departed from but uniformly
adhered to as will appear from quota 1,ions from the
following cases:
           In city of El Paso et al. v. Howze, 248
5. W. 99 (writ of error denied), which dealt with a
City Charter provision  requiring rendition and as-
sessment at a “fair market value”, the Court said:
Hon. William   N. Hensley,    Page, 7, v-776


             “Then assessor a@ ,collector       oft the
     city of El Paso is ~the office*        tiji6ri whom
     is impo.sed the duty of making’the ini-
     ;p;t;:;uatlon       of property r~endered for
                    The .law, has established      the ,~
     basis o?‘the’ valuation td be “its true
     and full value in money” .(article ‘753’0,
     R. S.:) or as it is termed in article
     7569. 6. S.,: “its reasonable cash mar-
     ket value. n
           “in the valuation  of property the
     function of the city council is limited
     to that of a board of equalization..
     When exerci,siag  such function,  it has
     the authority not only to equalize val-
     ues but to see that all property has
     been assegsed at its falr market :value.
     But before such board can increase the
     value of property theretofore~ assessed
     it must give notice to the owner and
     afford him a hearing.
           .“In this case Howse. rendered his
     property to the asses’sor asd that offi-
     cer approved and accepted the valua-
     tions placed thereon.    This valuation
     by the assessor was a quasi judicial
     act and wasp not subject to increase
     except by the board of equaliaation
     after notice and hearing.     No notice
     was given, 90 shearing was afforded,    and
     without the consent of the taxpayer the
     valuation was changed and increased by
     the assessor,   acting under the order of
     the city council made in i.ts legida-
     tlve capacity,   on August 14th.    We are
     of the opinion that such incregs,e was
     invalid.    . .
             ~“The~.
                   edidence- shows that for a
      I’& t.ime ,it. has been .the custom of the
     ..oltp.:t~o a&ss    property. upon the basis
      oC.64 per cent, Of it.% ~ptual, or market ~.
     va$ue and the value which the assessor ‘,
      placed upon the plalnt$ffls      property in
      the qriginal     assessment was 6stimat.ed
      upon that basis.,, ‘But an assessment
      made by the assessor upon ,that basis
                                                      .   .   .




Hon.   William   N. Hensley,   Page 8, V-776


       when uniformly          to all okE+h;nt;x.+L
       ;b$e FoRpert.: is not Invalid.
                        244 u. s. 499, 37 sup:ct:
       673' 6i L: Ed:'1280 Ann. Gas. 1917s aa-
       Taylor v. L. % N. R: R. Co., 88 Fed.'305:
       31 C. C. A. 537; Cam Phosphate Co. v.
       Allen, 77 Fla. 341, gl South. 503.
             "On the contrary   it Is valid and
       must stand as made u&l1 corrected    by the
       proper reviewing authority and in the man-
       ner prescribed  by law."
          See also the statement by the Waco Court of
Civil Appeals in Duvall v. Clark, 158 S. W. (26) 565,
from which we quote as follows:
            "And It Is well settled    that an as-
       sessment at less than actual    or market
       value when uniformly applied    is valid."
           To the same effect, the Supreme Court of the
UniteilSEatg   in the case of Greene v. Louisville  R.R.
co.,             u. S. 242, 1280, stated In the follow-,
ing la&go**
             "It Is equally plain that it makes
       no difference   what basis of valuation-
       that Is what percentage of full value-i
       ma be adopted,, provided it be applied
       to L 11 alike.   The adoption of full value
       has no different   effect  in dlstrlbuti
       the burden than would be gained by ad 7 p$-
       lng 75 per cent< or 50 per cent, or even
       10 per cent as he basis--so      long as
       either was applied uniformly."
            It is  therefore   apparent that the custom
of fixing valua<ions at a iercentage     of the full lOO$
valne    for the purpose of taxation is 1egaI If equal-
ly auu uniformly applied to all taxpayer8 and property
of the County. We do not mean to Imply that we ap
prove the percentage method.aa th&ons thaO.should be
generally accepted by the -tie&or                     and
Board of Equalization,    if an assessment at less than
the full "fair cash market value" seems adequate to
meet the fiscal   needs of the taxing authority,    but
merely hold that the same Is not Illegal     If equally
and uniformly offered to all persons and property
      .




Ron. William    N. Hensley,   Page 9, v-776
                                                    .


within the jurisdiction    of the taxing authority.  You
ask what remedial action can be taken by the Bexar
County Commissioners' Court if it does not agree with
the percentage assessments of the Tax Assessor-
Collector   and desired that they be raised to full
cash market value.     The Court, sitting as a Board of
Equalization    after due notice to each taxpayer af-
fected    has ihe authority under Article  7206 to raise
the values not to exceed lOO$. By the same method,
the Court has the authority to lower assessments so
long as all are given equal and uniform treatment.


           The Constitution   and Statutes of this
     State rc::ulre uniformity   of assessment of
     real and personal property at full cash
     market value, but the courts have held that
     assessments at a lower percentage of market
     value are valid if equally and uniformly
     applied to'all    taxable property.   Therefore,
     the taxing authority may require all proper-
     ty to be assessed at 106 market value or
     any fraction   thereof equally and uniformly
     applied.    Lively v. Missouri Kansas Teras
     Railway Company of Texas 120 S. W. 852.
     Duvall v. Clark, 158 S. 4. (2d) 565; ci$y of
     El Paso w.        v. Howze, 248 S. W.
     v. Louisville    R
     w;      Texas Conik
     tions 1, 11 and 20;...-
     Articles   7149, 7174, 7211, 7218, '7219, 7222
     and 7224.Y.c.5
                                    Yours very truly,
                                ATTORNEY
                                       GENERALOF TEXAS




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