Affirmed and Substitute Majority Opinion and Concurring Opinion filed
November 26, 2013.




                                       In the

                     Fourteenth Court of Appeals

                               NO. 14-12-00819-CV

     LONE STAR COLLEGE SYSTEM AND RICHARD CARPENTER,
                         Appellants
                                         V.

  IMMIGRATION REFORM COALITION OF TEXAS (IRCOT), Appellee

                    On Appeal from the 281st District Court
                            Harris County, Texas
                      Trial Court Cause No. 2009-79110

      SUBSTITUTE CONCURRING OPINION


      I write separately to urge the Texas Supreme Court to take this case and
clarify the law of taxpayer standing. While I believe that the majority opinion
reaches the correct result under current case law, it is based on cases that deal with
municipal taxpayer standing and not state taxpayer standing. The Texas Supreme
Court has not yet directly addressed state taxpayer standing (other than to conclude
that payment of local sales taxes does not confer municipal taxpayer standing), and
I would urge the court to clarify the law and ultimately to conclude that a taxpayer
must show more than just payment of taxes into the state general fund for standing
to sue a municipality or local government entity over the expenditure of those
funds.

         The facts are undisputed. The grants at issue are funded solely through the
state’s general fund. The only basis that IRCOT alleges for standing is that one or
more of its members pays franchise taxes, attorney occupation taxes, or oil and
natural gas production taxes into the general fund. These state taxes are three types
of taxes among hundreds of other sources of taxes and fees that make up the
general fund. IRCOT presented no other evidence linking its payment of taxes to
the disputed funds at issue and presented no other evidence of injury. IRCOT
claims that Lone Star’s conduct—following our state law authorizing these
grants—violates federal law.

         This is a case of first impression. The Texas Supreme Court has never
directly recognized taxpayer standing on the basis of payment of taxes into the
general fund. The court has found taxpayer standing based on the payment of
property taxes and, in the same case, rejected standing based on the payment of
sales taxes. Williams v. Lara, 52 S.W.3d 171, 179–80 (Tex. 2001). I acknowledge
that the court has stated that taxpayers in Texas need not demonstrate a
particularized injury to enjoin the illegal expenditure of public funds. Id. at 179.
Yet, the court in Williams went on to cite with approval the federal test for
taxpayer standing. See id. at 181.

         The Williams court looked to federal law for guidance on taxpayer standing:

         Under federal law, taxpayer standing is divided into three
         categories—federal, state and municipal—depending on which

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      entities expenditures are being challenged. To have standing to
      challenge a federal expenditure, taxpayers must establish a logical
      nexus between being a taxpayer and the type of action challenged, and
      demonstrate a link between their taxpayer status and the precise nature
      of the constitutional violation alleged. See Valley Forge Christian
      Coll. v. Americans United for Separation of Church & State, Inc., 454
      U.S. 464, 479–80, 102 S. Ct. 752, 70 L. Ed. 2d 700 (1982); Flast v.
      Cohen, 392 U.S. 83, 102–03, 88 S. Ct. 1942, 20 L. Ed. 2d 947 (1968).
      State taxpayer standing involves a similar test derived for the most
      part from Doremus v. Board of Education, 342 U.S. 429, 72 S. Ct.
      394, 96 L. Ed. 475 (1952). In that case, which involved allegations of
      both state and municipal taxpayer standing, the Court rejected the
      taxpayers’ standing to challenge a state statute providing for the
      reading of Old Testament verses at the opening of each public-school
      day. The Court held that the plaintiffs had not shown “the requisite
      financial interest that [was], or [was] threatened to be, injured by the
      unconstitutional conduct.” Id. at 435, 72 S. Ct. 394. The test for
      municipal taxpayer standing, on the other hand, clearly involves less
      stringent requirements. See ASARCO Inc. v. Kadish, 490 U.S. 605,
      612, 109 S. Ct. 2037, 104 L. Ed. 2d 696 (1989) (Kennedy, J.)
      (explaining that the relative closeness between municipalities and
      their taxpayers justifies a more lenient test for establishing municipal
      taxpayer standing than for establishing federal-taxpayer standing).
      Municipal taxpayers need only establish that they pay taxes to the
      relevant entity, and that public funds are expended on the allegedly
      unconstitutional activity. See Massachusetts v. Mellon, 262 U.S. 447,
      486–87, 43 S. Ct. 597, 67 L. Ed. 1078 (1923); ACLU–NJ v. Township
      of Wall, 246 F.3d 258, 262–63 (3d Cir. 2001); Doe v. Madison Sch.
      Dist. No. 321, 177 F.3d 789, 793–96 (9th Cir. 1999); Doe v.
      Duncanville Indep. Sch. Dist., 70 F.3d 402, 408 (5th Cir. 1995);
      Gonzales v. North Township of Lake County, 4 F.3d 1412, 1416 (7th
      Cir. 1993).

52 S.W.3d at 181 (footnotes omitted).

      The court concluded that “[b]ecause these standards mirror what is
necessary to establish taxpayer standing in Texas, we look to the jurisprudence of
municipal taxpayer standing to guide us . . . .” Id. But in Williams the taxpayer


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found to have standing claimed it on the basis of his payment of property taxes to
the municipality—the county.

      The majority opinion analyzes this case under the municipal taxpayer
standing test rather than the state taxpayer standing test. While it is true that
IRCOT is challenging a municipal expenditure, it is a municipal expenditure
funded solely by state taxes. Under these circumstances, the closeness between the
taxpayer and the municipal entity is lacking. I believe the Texas Supreme Court
should formally adopt and apply the state taxpayer test, and conclude IRCOT lacks
standing to bring this case because it failed to show the requisite financial interest
that was injured or threatened by the allegedly illegal conduct. See Doremus v. Bd.
of Educ. of Hawthorne, 342 U.S. 429, 435 (1952).

      In DaimlerChrysler Corp. v. Cuno, the United States Supreme Court
considered whether state taxpayers had standing to bring an action in federal court
to challenge whether certain state tax credits attempting to target new investment
violated the Commerce Clause. There, the plaintiffs attempted to argue standing
based on their status as Ohio taxpayers, but the Court held that state taxpayers have
no Article III standing to challenge state tax or spending decisions simply by virtue
of their taxpayer status. 547 U.S. 332, 346 (2006). In doing so, the Court applied
Doremus:

      The foregoing rationale for rejecting federal taxpayer standing applies
      with undiminished force to state taxpayers. We indicated as much in
      Doremus v. Board of Ed. of Hawthorne, 342 U.S. 429, 72 S. Ct. 394,
      96 L. Ed. 475 (1952). In that case, we noted our earlier holdings that
      “the interests of a taxpayer in the moneys of the federal treasury are
      too indeterminable, remote, uncertain and indirect” to support
      standing to challenge “their manner of expenditure.” Id. at 433, 72 S.
      Ct. 394. We then “reiterate[d]” what we had said in rejecting a
      federal taxpayer challenge to a federal statute “as equally true when a
      state Act is assailed: ‘The [taxpayer] must be able to show . . . that he

                                          4
      has sustained . . . some direct injury . . . and not merely that he suffers
      in some indefinite way in common with people generally.’” Id. at
      433–434, 72 S. Ct. 394 (quoting Frothingham [v. Mellon, 262 U.S.
      447, 448 (1923)]); see ASARCO [Inc. v. Kadish, 490 U.S. 605, 613–14
      (1989)] (opinion of KENNEDY, J.) (“[W]e have likened state
      taxpayers to federal taxpayers” for purposes of taxpayer standing
      (citing Doremus, supra, at 434, 72 S. Ct. 394)).

DaimlerChrysler, 547 U.S. at 345. The Court also rejected the plaintiffs’ attempt
to recast their state taxpayer standing claim as a municipal taxpayer standing claim.
Even though they argued that the local governments’ funds were depleted by the
state tax benefits, the Court concluded “plaintiffs’ challenge is still to the state law
and state decision, not those of their municipality.” Id. at 349–50.

      Similarly, if IRCOT had sued Lone Star in federal court for violating federal
law, it would have had no Article III standing—whether based on state or
municipal taxpayer status—to do so. Why then should IRCOT have standing to
bring the same claim in state court? See Paul J. Katz, Standing in Good Stead:
State Courts, Federal Standing Doctrine, and the Reverse-Erie Analysis, 99 NW.
U. L. REV. 1315, 1344–49 (2005) (arguing for expansion of reverse-Erie cases to
the standing context).

      I therefore urge the Texas Supreme Court to take this case and apply the
state taxpayer test to IRCOT’s claims and dismiss the case for lack of standing.




                                        /s/       Tracy Christopher
                                                  Justice


Panel consists of Justices Christopher, Jamison, and McCally (Christopher, J.,
concurring). (McCally, J., joins in the Majority Opinion and in the Concurring
Opinion).
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