OFFICE   OF THE AmORNEY     GENERAL   OF TEXAS
                   AUSTIN
HolcaorablrTfm Seay - page 2



      oontnot with the Amarillo Ba84ball Club, Inc.,
      in rordr and Slgura8 the 8am4 a8 the contrect
      rdurod   to in the anolo84d order,

             -At tha tire this order ram p8884d and the
      oontmot    wan 6ntued into, th4 8bovr refurod
      t0 prOpUtJ    n8 6ituatad OUt8ib8 of thr City
      Liqiitr of the City oi Amarillo, but ban r4a4ntlt
      b48n   inoorponted          la    the    Uitr   Lbit8.      IU    prop-
      4rt7   llOW 1148    804     h8     iOr
                                II loll& t-4 lain in
      th4 Aaerillo TJld4p4lld8llt
                               Sohool Di8triet.

           "Purmmnt to the tunu of the oontxmot,
      thr Amarillo B484ball Club oonrtruotd  upon
      th8 leas4d ~remi848 a be84ball park, oonri8t-
      ing  of   (mnd     8t4nd,        bleaehars,      ticket    OffiO48,
      fOnO48,    4t6.

             “Th4   qU48tiOn   hs8 now ari84n a8 to rhsth4r
      the Amarillo Ba84ball Club should be r4quir4d
      t0 p6;r t4X48     t0 the V4riOU4 taxing ag4uOi48
      On th4    4884884d    VFh6tiOIi Or th4 8trUOtUr48
      pf404d    Upon th4 14884d Prd4.8.

             %4 ~811 your att4ntion to tha tact that
      at the expiration ot ths oontraot involv4d,
      the tit14   to all OS thr lapromm4at8       oon8tru4-
     ,tsd br th4 Amarillo Ba88bdl     Club -8848 $0
      an& v48t8 ia th4 COW&~    u  r4ntFd8    for   the bUa
      of the grelud upon which rid      b~W3lb4llt8
      am3 oonstruOtd0

           “I%4 VUiOIU hXilbg ag8Mi48    hew mqU48t4d
      that I writ4 pu   I4pmtm4nt Sor vour opinion
      a8 to rh4th4r th4 improvam4nts oon8truotrd by
      th8 ba84ball olub are 8ubj4ot to taxation by
      the various taxing units.*

             The   ?ollming        arm     putfnrnt       p?Oti8iOlUS       8opi6d
from the oourt     ordu       ati 14a84 whloh GUY               8ubEitt4d dtb
your rvqueotr
honorable Tom SSPJ - page 3



           (*I   "It I8 agreed t&at  et tL4 expiration
     Or tho tblm   OS th18 lgr44mont th4 title to 4eid
     ba84ball park to bo colutruoted    upon thr above
     d44crItctd.prop4rir 8hal.l pe84 to en& V48t in f44
     8iEpl4 in th4 COuntr, to b4 owned, o04upi46, and
     u84d by It a8 it 8048 rit, rhIoh 8eId ba84bell
     park 8hall b4 rscsivcd by th4 Cowt7 in full 8et-
     i8fbQtiOn of all r4ntel8 due end owing to it hare-
     und4r."

           (b) nlt 18 eg446 that Ia th4 814nt J&4-
     844 fei18 t0 UC4 Eidd ba84brll park fOT W2y an4
     Or morc baseball 8belOn8 iOr th4 pUtpO84 Of
     flayiog be84bell therein, th4n end in 8uoh 4r4nt
     the County, cr 44 on4 d48ignetrd by It., 8hell
     hers th4 right to OQOIIPJ,   une end enjoy    8aia
     baseball park for eq and lll purpo840 thet          4am4
     may be ussd wittbout de.eegin~ 88id property be-
     yond ordinery w@er 8nd tber during all of such
     pears SS L4s840 do44 not play be84ball th4r4in;
     but in such year8 as L46844 pl4yS bssebal.1        in
     Eeid ba84bell park,    it 4hall b4 4otItl86 to '~4 .
     8eid park for th4 portion ot such y4ar8 84 8eme
     Is not ueed for playing b284ball for plajlog or
     conducting oth4r iaeoesnt 8port8 tharoin, 48
     h4r4Inaboro prorib      for, It b4in(r in th14 con-
     neoliofi ~igrosd that et any the v&411 bss4ball
     8eR8On I8 not in prOgr488 lhd l.48844 18 ilOt
     using or hao not plennsd to ~80 8eId b444b8l.l
     park for oth4r ionoc4nt 8port8, tli4 Cou&ty shell
     hav4 the right to dolegate to thr hmerillo Tri-
     StRte  GXpO8itiOn tiin right  to U84 S8id    ba84bRll    oprk
     for May pUlYpo80 that Uill not dUM(;4      8epM J4or4
     then ~lnying b484bell th4rrIn, 8nd beyond ordin-
     dry weer an4 teer without coat whctso4rrr        to
     8aid h84rillO Tri-%.at4 k'XpO8itiOn, JmOVid4d
     however +hat anp.mtuIel      aaeiag4 bayorrd ordinary
     near  end t4er don4 to 8eId pr4mI848 by 8eid AS-
     erilio Trl-kIteta   xspo8Ition 8hell b4 rsp4lr4d      by
     it et It8 4We CO8t alId 4Xp4n84.”
Honorable Tom Seey - page 4



             (0) "It la agreed that In the event It 18
     d8tenlned by the varlix18 taxing agene%&, that
     the lmprovem8nt8 oolutructed upon the above da-
     8orib8d   treat of land by Lea8er are taxable as
     porronal property, the L8888r shall and ~111
     promptly pay much faxes e8 they beaome due and
     payable .I

            (a.1 "It 1 8lgmad that in the event L@8808
     install8 a lighting 8ymtam In Bald ba8obal.l park
     for the purpo88 OS playing ba8eball therein at
     night time., 8aa8 rhall be at all tlmss'aonuld-
     erad p8rronal proparty and sot a apart cf.&e
     bassball.park; and upon the expiration of thi
     trrm ,hereln or at any t~ime it d8slrsa Ls888s
     ahall have the rlgtt to remove all or any part.
     of said llghflng ry8tem from 8ald baseball park,
     there being rwssrved  to the .County, howaver, the
     right to purchase 8ald lighting systam from
     Lesrea at the 8rplratldn of the teqhareof~or
     at euch other tlmr aa Le88e8 dl8oontlnues u8ing
     said baseball park or upon a breach oftany of
     the covenant8 hrrain contained and the doolara-
     tlon o? a forraiture by the County ror a @rlcr
     to be determined in the same mannor prorldod
     for determining the value of 8alvage In Pan-
     graph 3 horeof.w

             In mtro&     v. Mla8ion Indepandont School ::lrt.
et al., 195   3. W. 895, (r8tsrsed on,othar ground8 in gZE
9. WC. ZOl) the tiourt held that improtsments placed apoo
the land .oS a rsllroad company by a lessee with an agree-
arnt that It m8 for the ~88 bf tile 188sr8 and with the
further a eament that it could be removed wac perso=
wy       +ZTYiZTr~eXa~TF
          an                         aourtald,   however,
by way of dictum:

            *If it were not ;lereonal property end wer4
     real estate, it oould not hate beentax     an the
     property of the Mlralon Cotton Oil Company, but
     a8 the property of the railroad company that
     orrned the land to rhlch th8 lm,provsnsnts were
     8rrixea.- ,
                                         ,




lionorable Tom Yeay - page 5



            In your tmot situation, we hive lmprovement8
erected by the lr8ae8 upno lend of a oounty, with no
right to rem018 much improvements, but an exprese agree-
ment that title thereto "She11 pa88 t0 Md VOSt iAt . . .
the OoUnty” rt the explratlon    of the term of the lease.
See paragraph   "(a)* above. The lOa#e agreement furt bar
provide8   tbRtth8 1888ee ~111 ay the tales againat the
imprOY=#nt#                       8 dStSrP3i5ed by the var-
               "ia the SVSJAt it f:
1OUS taxing agenOie8 that the i~9rOtWSntS     OOnStrUOtod
upon the above described tx%ct of land by Leee-e are tax-
able as personal property.*     gee paragraph *(a)- above.

          The flr8t qu8Rtlon for our detennlnation 1st
Are the btiprOVement8 COnStrUOted by the 1eSeee upon the
land 0r the county *personal 9ropertyY    Xe think not.
It ia true that the lease provides that title to the
improvsm85te #ho11 ,?ess to and vest in the county "at
the expiration of the Dorm” of the lame, but we m-9 of
the opinion theft suoh im~rovemente lost tlielr character
ae Wperson&l property" immediately upon being erected
upon the land of the oounty and then became a mrt of
the "real 9et5tS " or the oounty.

          i%'#have been unfibli,to find any Texas OaSeS
directly in point, but in Intrrnational Nnr. Co. v.
Barber, 47 K. E. 46, a ahod eracted by tie leeoee upon
P pier, pUr#Uant t0 a lea88 from the City requiring it8
-~=t~~~h+p!l&            yy~~o~2t~~8~"~-
Iid GEiFt    0 prqomo        eo   yassoonasitwaa
ereoted and arrixea to the realty, and hence not 88888-
sable Sor taxation am property of the le.88ee. The court
Said:
          *The appellants rert tholr argument with
    reapeat to t&e question of OwnerShi upon the
    prOViSiO5 of the leaee abovo roneioned, that the
    ohed shall beoome the property of the oity after
    the 8r9lration of the lease, whloh provielon,
    as they maintain, shorn thrrt it Wall in ContW-
    plstlon of both parties that the ereotione
    Should be the property Of the #teamShip company
    aurlnu the texm of tho lease. We think that
    this is a5 inaorrWt view Of the eitWtiO5.
Iionorablo Tom Seay - page 6



          It is a ranlliar rule that, when 8truotur88
          are 8r8otea   by parsons not ow58re 0r the land,
          they beooru part or the realty, and am 8Wh the
          property et the landowner.    lt r8qulre8 a5
          a~8W85t     t0 bo .Xpr@###d in OrdSr t0 PrSVSJlt
          the operation of this rule. If the right of
          removal la r888rred to tha 108808 in a lease,
          than in euoh a ease ho will be regarded    a8 an
          OW58r Or r#ai #Sk88 ?OT th0 pmpO88     Of 8aXa-
          tion.*

          88 think the above oaea i8 OOfiSOt i5 prinO~pl8
and in haneony with the *diotwP    in Armstrong   T. Nl88ion
I5&8~8nd85t Sohool Diet., 8UPl.a. ATtie       7171 prOYid88
that *al1 real oatate shall be a88e88ed to the omer ther8ot
. . . ." *Real s8tat8w i8 0058tru8d by Artiole     7146-    to
inoluae the land itself. . . and all buildings, #tl'Wt~##
and Lmprorem85ts, or othar fiXtUrC38  of nhaterer kind thereon
 .   l   .*



          15 Dougherty v. ThO1~p805, 9 8. Vi. 09, the YUprelLe
Court of Teras maid:

                "'ThS g#ll#l'M1rId0 i8 that   the OW58r Of real
         lSk tr fi#a##d 18 kX@id UpOlI the #ld.irO    VSlUe Of
         th8 pro-and         tki#  SIRtiSiieS  the OOmtitU-
         tional  requ~r8m8nt tha8 *all property in th3.8
         State    rh8that OWlk#d~-b~
                                   Pot-1          PSQDIU Or OOr-
           OIdOM    Other thM=&Oi&Nl,      8hm   b8 baX8d
         f IIp,rOpOrtiO5 t0 it8 falU0. '" (mphaSi8 OUFS)
          B ial88Um8, for the POr 088 Of tbi8 0 iniOn, that
the Imad of the OOUnty i5VOlVad i n pour fist 8 f tUatb8 Wa8
rxmpt from taxation prior to the exeoution of the lease.
If not, we think the 1888ee liable for the payment OS th8
taxes UndSr the covenant "(0)" above. A8 we CO58til~S this
oofenant, it is trntamou5t to 0ayiILg that the ls88ee will
pay all taXe8 against the lmprov8mente, ii any are juaici-
ally deterJ&bed to be dUD. any Other oolutruction would
rO5dSr this oova5e0t ~Oani5glOeS.
                 J~~~ming        that the leaSed portion Of the COUnty
was exuppt, prior           to    the lOeSQ, thl8 qUeStiO!l next uriLW8;
Iionofabls Tom zZn8y - ;?nga 7



316 auch@operty   l&8$1Jta y&apt chtmdter whag leaaad:~       .
the baeeball club for the purpose of ylts.yinc baseb611 thereon?
Le think not. Gbviously, 8UOh property fs S.lbjeCt to %x8-
tion unle88 exempt either by the constitution or the stat,l&es
of this State.




orolu8ively to this State,
Of" shall be exempt from taxation. Countias are political
aubdivislons of thr:state. Constitution, Article 11, Section
1.

          frtlcle 7150 would appear to be broad enough to
cover the property in question, for certsinly such property
"belongs exclueivaly" to the county, but au pointed out in
City of .libilenev.Stata, 113 S. ii. (2d) 631, the exemption
declared in this Article was more comprehensive than the
power which the Legislature possessed.

           In Cltp of Abilene v. State, supra, t,he court     held
that 24 tracts of land nurcbased by the City of Abllene for
the purpose of a reservoir site for impounding water to be
used by the city wae exempt frou all taxation, though suoh
traots were beins temporarily leased for agrictiltural      pur-
poses, where the city had not abandoned its Intention to
build the reesrvoir.   it  iS significant thet the trial court
found that eince acquisition of the lands by the city, it
had "been leuslng 8.ailefor agricultural  jxr?ose.s    for an ap-
pr~r1mat.e aggregcte annual rental of 22, LOO and that during
the pact five years Oa8h rentals have been paid therefore
and that prior to thattime receipts from mid property in
cash rer8 baaed upon apnuul production   of ngriCUltUr81 prod-
ucts undrr the normal l/3 and l/4 rentaln."      In construing
tho above quoted provielons of our constitution ant Article
7150, the court  said:
Honorable Tom Seay - p: ge 8



     .    WThese~oonrlderatiors leaa us teChn con-
     clusion that 8s to the power of the Legislature,
     to exempt pub150 property 'from taxation, 811
     such property should be regarded as *used for
     publio purposee' when it Is owned and held for
     public purposes*, --
                       but not o-:ned or held exclu-



           “* . . It is, tterefore, our vier'that
     when the facts of a given case sst8bXsh the
     ownership of property by a muniolpal oorpcra-
     tion,~whIoh haa been acquired for an authrr-
     lzed public purpose, and tha purpose for which It
     is owned and held has not been abandoned, such
     property ie to be regarded a8 used for public
     purpoees ( 8nd the Legislature has the power to
     provide by Ceneral 18~ for its exemption from
     taxation."

           There can be little doubt that the property owned
and beld by Potter County for a fair-ground 1s "public
property" within the rontemplatlon of our Constitution, 8nd
owned and held ror a "public purpose."    *Cases cited in 92
A. L. H. p. 77D. a;e think by the authority ofCIty of kbl-
lene v. State, suprh, it ten be seid to be "used for e.pub-
110 purpose."   No "cash rental" was paid PotFCounty,
but only the “bareball park” eta. whioh wa8 8 physical lm-
proviment to the fair-grounds.   In this respect, here is a
strongar fact  ease than ths City of Abllene v. Stats, supra,
for there the oitp did receive "oash rentals."    -,otterCoun-
ty re88rVed the right to use the vbaseball p8rkusetC. at all
time8 it was not being used for playing baseball, thereby
lnoreaeing the deeirabillty of Its rair-gound fecilities.
.See paragraph "(b)" above.

          ;n State v. City of lfou8ton, 140 :j.X. (2) 277
(writ refused) the court said:
                       Honorable Tom Sear - page 9

I   ~c‘.*a       -I        AL,-       -          ‘   -   -   -   ,,_   .,,_   --         -     -      LL     -   m   ..d. ...-..   :.a,..-   ,m   d



                                          *ThrSaot that    tha property ra8 rmntsd to
                                  prlrate p o r o o 1 l sd warn Olossd to ths public,
                                                      I8,
                                  a0a4 not a4o444arlly detumiae that suoh i8 giot
                                  held for a publio purp~u.~

                                  In our opinion, the Lurrlllo Baseball Club, Ino.,
                      1s nslthsr llablo for tax44 against  ,ths lmproromeatm as
                      aporsonal pr~psrtp   bsloaglng to it,,aor br rsasoa Of its
                      ootrrvlat la the lams4 to pay tuss,  but that such blub 18
                      limb14 to pay taxes against tha wloasehold iatarast" lt
                      aoqtirod br the lsasa. ,Artiola 9198 protldur

                                         *Property t&d under a leau of three yearn
                                  or aoro . . . . bslonglng to this Stats, or that
                                  Is uunot b •l~~~f~Ltant~oa          the hands 'PT
                                  tlie owner XE          Tl bo eoa49 aZFZtTiYaTT
                                  ~p~o~~oa,              as' the property of thl psr-
                                  son so holding the same. . . ." (smphasls oure)

                                          Artida T194 proridss, in part:

             .
                                   .    "4nbla laasshold askates shall be ralusd
                                  at sueh a prlss as they rsuld bring at a fair
                                  voluntary sals for oash.*

                                          In         Daugherty           f.        Thempson,       supra, the Court saldt

                                        *Th* onlf law provl4lag        that     a 14444e shall
                                  pay tax44 Oa 1oassU proparty 14 found In artl-
                                  010 4691, RsT. qt.,     mhlah dstarmlnes        what   laass-
                                  hold lstat8 shall bo taxable.          Eiubdlrision 4, art,
                                  MOP, E&. St,,     aaa ham lpplioatioa to no other
                                  lusshold matatom     than   suoh u are Isad* taxable
                      .*          by the praoedlng    artlols; for la all othei oases,
                                  in the abseaos of a statuk directing to the oon-
                                  Wary;  the owmr Ot the nal lkti~ mtl8t ppy tax08
                                  oa the mtira    ralua of the LaaIi, whether leased
                                  or not. In USM       to nhioh arfAo10 4691 14 appli-
                                  oabla, it rust bo bald that       it ma the lntentlon
                                  ot the le&s&tura       ew    to iqposa on ths lss8e.
                                  a tax based oa the raluo of thr           utaublm    laa8o-
                                  hold oatate," an4 a&      lmpomo   upoa him n tax based
                                  oa a sum equal to the tull raluo oi the ram1 es-
                                  tata, to.bm ls  o er ta h as d proribs4 in subdld-
                                  sloas 1, 8, 8, art. 4b92, Refd3t.m
i;onorable Tom r;eay - page 10



              The texing pOliCy.ot the State IS axpress4d'la
Art1010 8, Section 1, 0r our Conatltution as follcm4: *Ali
property -- In this State, whether owned by natural pereorG?r
            --
corporations,     othman      munial al shall be taxed in ro-
 ortlon to lts~e.        1-.mzi&iL?~e-VlWEl&*
&In       opertz , real , personal or mixed, except such as may
%-rIi.b          expressly exempted, la subject to taxation,
and the same shall ba rondared an~l~sted as%roln        prorldod.”
(4mpha414 ours)

           Since the property in question 14 *held under o
lease of three pars   or more* and is suoh property *that is
ercuupt by law rrom taxation in the hands of the oanor thereor,"
we are oi the opinion that the "leasehold interest? of such
baseball olub in said property is taxable against the .mar-
illo Baseball Club, Ino ., and Article 7173 is both appll-
cable ani controlling inyour'fact   situation.

          The lighting syntem is, of course, taxable against
the baseball club.

           Trustlag that the above anmom your questions,
we ma,

                                       Yours very truly,

w@EOVED   NOV. 10, 194S            ATl'ORtEY TlXEi!AL OF TFXAS
Grorrr Sellers
FIRST ASSISTAFT ATTCRN'T
GENERAL                            BJr/*/
                                             Thorn. B. Ruggaa
                                                    r84istant

16




A?PROVED OPINION COMWITIEB
BY BL'B CJIRUAN



                                                   TBD:r*
