                                The Attorney General of Texas
JIM MATTOX                                          hagust 21. 1986
Attorney General


Supreme Cowl Building          Honorable Gary Gar:::tson                Opinion No.     .JK-536
P. 0. Box 12548
Austin. TX. 78711. 2549
                               Ector County Attor:rey
5121475.2501                   Courthouse, Room 2’13                    Re: Validity     of a “tax clearance”
Telex 9101874.1367             Odessa, Texas    79 761                  account  for    excess property    tax
Telecopier 512l475-0256                                                 payments

714 Jackson, Sulle 700         Dear Mr. Garrison:
Dallas. TX. 752024506
21417428944                         Pou ask us the following     questions:

                                             Are there      any legal   objections    to the Tax
4824 Alberta Ave.. Suite 160
El Paso. TX. 799052793
                                          Assessor-Collector    of Ector County, Texas, having
9151533.3484                              a ‘tax el,earance’ account into which are deposited
                                          excess llroperty tax payments and from which are
                                          withdrawn amounts necessary       to make up property
lW1 Texas. Suite 700
                                          tax paynents which are short?          If there are no
Houston, TX. 77002-3111
                                          legal ol jectlons,   does the Tax Assessor-Collector
71312255886
                                          have the authority      to create such an account or
                                          does thJs require approval from anyone -- ‘such as
808 Broadway, SuiIe 312                   the Ectcr County Commissioners Court?
Lubbock, TX. 79401.3479
SOSil4?-5230
                                      By your use of the phrase “tax clearance”       account and the
                               authorities  which you cite in the brief accompanying your request, we
4309 N. Tenth. Suite S         understand you to ask whether such an account may be established      that
McAllen. TX, 78501.1685        would serve to satisfy,    from the overpayments of taxpayers,     the tax
5121682.4547
                               liabilities   of those taxpayers who fall to tender sufficient    payxent.
                               We conclude that no such account may be established.        Because we do
200 Main Plaza, Suite 400      so, we need not answer your second question.
San Antonio. TX. 78205.2797
5121225-4191                        You have provided      us with the following      information   relevant   to
                               your request:
An Equal Opportunity1
Affirmative Action Employer               The ‘tax clearance’       account concept   is used by
                                          four ccunties’     tax officials     whom I contacted.
                                          They sa:Ltl that it is justified    by convenience, the
                                          money aid effort     spent to return overage/shortage
                                          checks,    and revenue lost      from not immediately
                                          deposlt:lug tax payments into the county treasury.
                                          The amomt of excess might be noted for audit and
                                          account,Lng purposes.      Each county set a monetary
                                          limit,   such as $10.00, below which a refund would




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Eonorable Gary Garrison             - Page 2       (JX-536)




                be sent only upon taxpayer request.        Apparently,
                under the Properi:y Tax Code, a refund of excess
                payment is not required unless and until a tax-
                payer requests    it.    The excess amount would be
                deposited  into !:he tax clearance      account.    Tax
                payments which are ‘short’ by no more than a set
                amount, such as $2.00. are acceptad.      The shortage
                is noted for auditing       and accounting   purposes.
                Money is    trans:iarred    from the tax     clearance
                account to make up the shortage.

      Article      VIII,      section   10, of     the Texas Constitution   provides   the   :
following:

                910.      Release’ from payment of taxes

                    Sec.  10.  The Legislature    shall have no power
                to release the inhabitants     of, or property in, any
                county,   city or town from the payment of taxes
                levied   for Stats or county purposes,        unless in
                case of great public calamity in any such county,
                city or town, when such release may be made by a
                vote of two-thirds   of each Rouse of the Legisla-
                ture.

      Article          III,   section   55,   of   the Texas Constitution   provides   the
following:

                $55. Release or extinguishment of indebtedness to
                state, county, subdivision  or municipal corpora-
                tion

                    Sec. 55. The Legislature         shall have no power
                to release    or extinguish,       or to authorize     the
                releasing   or sxt:lnguishing.     in whole or in part.
                the  indebtednesri,, liability     or obligation    of any
                corporation   or jadividual.     to this State or to any
                county or defired      subdivision     thereof,  or other
                municipal   corporation     therein,    except delinquent
                taxes which have! been due for a period of at least
                ten years.

      While penalty and interest  owed on delinquent taxes may be waived
if it is so provided by l~aw. Jones v. Williams,     45 S.W. 2d 130 (Tex.
1931) ; Attorney    General Dpinion JM-311 (1985),     taxes   themselves,
whether current or delinquent.    clearly may not be.     Smith v. State,
420 S.W.2d 204 (Tex. Civ. App. - Austin 1967). aff’d.      434 S.W.2d 342
(Tex. 1968).    State v. Pkneer Oils Refining Co., 292 S.W. 869 (Tex.
1927).  By utillaing   any &ess   tax monies paid to the taxing units to




                                               P. 2468
Eonorable   Gary Garrison    - Pa:ge 3      (JM-536)




offset    the shortage of tho!re who fail to tender the full amount, the
tax assessor-collector        would be impermissibly waiving or releasing        the
debts owed by those who fa!.led to tender           the sufficient    amount. The
legislature     Is clearly     prohibited  from authorizing    such a practice     by
article    III.   section    55, and article   VIII, section     10. of the Texas
Constitution.       Since the legislature      may not authorize     the practice,
it    follows     that    neither    the commissioners      court   *or   the    tax
assessor-collector       may do so.

      Even if the practice       about which you inquire were established
only for purposes of more efficient         accounting,   &,      if no attempt
were made to release        or extinguish     the tax liabilities      of those
taxpayers   who tendered an insufficient         amount, the practice      would
still   be statutorily    impermissible.    In your letter,     you state that
tenders of payment which are less than the amount imposed by, for
example, $2.00 are acceptoil.        There are only two means by which a
tender of less       than the amount imposed may be accepted~.            First,
section   31.03 of the Tax C,ode authorizes       a split    payment whereby a
taxpayer.who    tenders one-half      of the taxes owed by December 1 may
tender the remaining half by July 1 with no accrual               of penalty   or
interest.    Second, section 31.05 of the Tax Code authorizes discounts
of certain specified     percer.tages for payments tendered before January.
There is no other provision         which permits acceptance      of any amount
tendered that is less than the amount of taxes imposed.

      Accordingly, we, conclude that the county tax assessor-collector
may not establish  a “tax c,learance” account in which excess property
tax payments may be depo,;:Lted and then withdrawn to offset         those
property tax payments which are less than the amount imposed.

                                   SUMMARY

                A county tax assessor-collector  may not esta-
            blish   a “tax cl,carance” account in which excess
            property tax payments may be deposited    and then
            withdrawn to offeiet those property   tax payments
            which are less tham the amount imposed.




                                               JIM     HATTOX
                                               Attorney General of Texas

JACK HIGHTOWER
First Assistant Attorney       General




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Eonorabla   Gary Garrison - Pqe      4    (JM-536)




NARYKELLER
Executive Assistant     Attorney   General

RICK GILPIN
chairman, opinion     Cdttee

Prepared by Jim Moellinger
Assistant Attorney General




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