                          QBfficeof the !ZlttornepQkneral
                                      $Mate of aexae
DAN MORALES                              April 20,1992
 ATTORNEY
      GENERAL



     Mr. Larry E. Kosta                      Opinion No. DM-110
     Executive Director
     Texas Department of Licensing           Re: Whether section 11(b) of the Texas
       and Regulation                        Boxing and Wrestling Act, V.T.C.S. article
     P. 0. Box 12157                         8501-1, applies to cable television companies
     Austin Texas 78711                      collecting pay-per-view fees from subscribers
                                             viewing live telecasts of professional boxing
                                             performances (RQ-208)

     Dear Mr. Kosta:

             The Texas Boxing and Wrestling Act (the act), V.T.C.S. article 8501-1,
     requires the Texas Department of Licensing and Regulation (the department) to
     collect a three percent gross receipts tax on admission fees charged to view a boxing
     match, contest, or exhibition conducted in Texas or shown on closed circuit telecasts
     in Texas. V.T.C.S. art. 8501-1,s 11(a), (b). Section 11(b), which applies specifically
     to persons charging admission fees for exhibiting a live telecast of a boxing match on
     closed circuit television, also requires such persons to acquire a boxing promoter’s
     license and to obtain a permit for each closed circuit telecast shown in Texas.
     Section 11(b) of the act states:

                    Any person who charges an admission fee for exhibiting a
               simultaneous telecast of any live, spontaneous, or current boxing
               match, contest, or exhibition on a closed circuit telecast must
               possess a boxing promoter’s license issued pursuant to this Act
               and must obtain a permit for each closed circuit telecast shown
               in Texas. The [three percent] gross receipts tax. . . is applicable
               to ,said telecast, and the boxing promoter shall furnish to the
               department within 72 hours after the event a duly verified report
               on a form furnished by the department showing the number of
               tickets sold, prices charged, and amount of gross receipts
               obtained from the event. A cashier’s check or money order




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Mr. Larry Kosta - Page 2                        (DM-110)




           made payable to the State of Texas in the amount of the tax due
           shall be attached to the verified report.

The state deposits the money it receives as a result of the gross receipts tax into the
General Revenue Fund. V.T.C.S. art. 8501.1, # 11(c). You request our opinion as
to whether section 11(b) applies to cable television companies that collect from
their subscribers special pay-per-view fees, entitling each paying subscriber to watch
a simultaneous telecast of live boxing matches. If section 11(b) does apply to pay-
per-view cable television companies, each pay-per-view cable television company
offering simultaneous telecasts of live boxing matches must acquire a promoter’s
license, obtain a permit, and pay the three percent gross receipts tax. The ultimate
issue is whether “admission fee,” as section 11(b) of the act uses that term, includes
the special pay-per-view fees cable television subscribers pay to cable television
companies for the privilege of viewing simultaneous telecasts of live boxing
matches.’

        Former article 614-1 of the Texas Penal Code was the predecessor statute to
article 8501-1, V.T.C.S. See S.B. 34, Acts 1973,63d Leg.. ch. 399,s 5, at 995. 996b.
The Texas Court of Civil Appeals, in a case involving former article 614-1 stated
that the article “strictly regulated” boxing activity, that is, the article was designed to
control all aspects of the professional boxing industty in Texas. Hwvq~v. Morgan,
272 S.WL?d 621, 622 (Tex. Civ. App.-Austin 1954, writ refd n.r.e.). While the
legislature has amended former article 614-1 of the Penal Code and its successor,
article 8501-1, V.T.C.S., since the Court of Civil Appeals decided Hmvey, the
current statute continues to strictly regulate boxing in the State of Texas. See
V.T.C.S. art. 8501.1,s 2.

       Principles of statutory construction require us to construe statutes in such a
manner as to accomplish the legislative intent- Attorney General Opinions M-119
(1967) at 2 (quoting 53 TEX. JUR. 26 Skafut~ 0 134, at 195-6 (1964)); M-156 (1967)

          tWefouadconflictingauthaiticsonwhcthcrthcterm~clostdcLcuittclcclrsf’~itispcedin
section ll@) of the. act, can be cmstnud to iwhlc “cable television,’ as the consuming public
uodorstwds the term “cable.tclcvisioo: compmr E. Foster, UNDERSIZING BRIG                           38,
4554% (1979) (defining and discmiq dosed circuit tekvirion and cable tchisioa) and WEBSER’S
NINIHNEW CotJXGIM'E        DIC~ONARY193,w) (1987) (defining ‘c&k,- “cable television,’ and ‘closed
circuit.) kth &%“i”~ of SpOm Ewnts, 34 F.C.C.Zd ml, 280 pare 36 (lm) (dis-                       dosed
circuit telcvhion flom subscription cable tel&ion for pu?poscs of anti-siphoning rule). As WCcan
dccidc the issue yo” prc.scot 00 the basis of the mcauing of tbe term “*dmission fc%. we do not discuss
whcthu “clod circuit telecast” can be construed to include pay-per-view tckasts.




                                               p. 558
Mr. Larry Kosta - Page 3                 (DM-110)




at l-2 (citing IndepndentLife Ins.Co. of Am v. Work,124 Tex. 281,77 S.W.2d 1036
(1934)). We must continually bear in mind, however, that statutes should be
construed in light of the evil the legislature sought to avoid by enacting the statute.
Attorney General Opinion WW-516 (1958) at 3 (citing Worthamv. Wdker, 133 Tex.
255, 128 S.W.2d 1138 (1939); Texa & N.O. RR Co. v. RailroadComm’n, 145 Tex.
541, 200 S.W.2d 626 (1947); 34 T&x. DIGEST Strmctes g 184); see also Attorney
General Opinion M-119 at 3. Here. while the act’s statement of purpose indicates a
legislative intent strictly to regulate the boxing and wrestling industry in this state,
we have found no legislative history indicating the evil the legislature designed
article 8501-l or its predecessor to constrain. Furthermore, we have found no
legislative history indicating either the legislature’s understanding of the terms
“admission fee,” as it used the term in section 11(b) of the act, or the evil the
legislature seeks to avoid by taxing admission fees to closed circuit telecasts. Thus,
we must construe “admission fee” solely on the basis of the plain language of the
statute.

        When construing a statute, we presume that the legislature used words and
phrases in the sense in which they are commonly understood. See Gov’t Code
g 311.011(a); 67 TEX. JUR. 3d Statures 0 132, at 737 (1989). The phrase “admission
fee” is commonly understood to comtote a sum of money one pays to enter a place,
such as a theater, an arena, or a concert hall. See WEBSTER’sNINTH NEW
COLLEGIATEDICTIONARY57 (1987) (defining “admission”). In common usage,
“admission fee” does not connote a sum of money one pays to view a movie, concert,
or sporting event on one’s own television, sitting in one’s own home. In our opinion,
to construe “admission fee” as it is used in section 11(b) of the act to include pay-
per-view fees goes beyond liberally construing the statute; rather, it tortures the
plain language of the subsection to construe the term in this way.

       Accordingly, as far as we can ascertain the legislature’s intent, the legislature
enacted section 11(b) to impose a tax only on fees people paid to enter into a place
for the purpose of viewing a simultaneous closed circuit telecast of a live boxing
performance. We note that pay-per-view telecasts of live boxing matches were
unavailable in 1977, when the legislature added section 11(b) to the act to impose a
gross receipts tax on admission fees paid to view closed circuit telecasts of live
boxing matches. Thus, at the time the legislature added section 11(b), it may not
have contemplated that pay-per-view telecasts one day would be available.
Consequently, we conclude that pay-per-view fees are not subject to the three
percent gross receipts tax on admission fees imposed by section 11(b) of the act, and




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Mr. Larry Kosta - Page 4               (~~-110)




cable television companies need not acquire a boxing promoter’s license and obtain
a permit for each telecast of a live boxing performance.

                                   SUMMARY

              Cable television companies collecting a special pay-per-view
         fee from subscribers who wish to view a simultaneous telecast of
         a live boxing performance are not subject to V.T.C.S. article
         8501-l. section 11(b).




                                                 DAN      MORALES
                                                 Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARYKELLER
Deputy Assistant Attorney General

RENEAHIcKs
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Kymberly Oltrogge
Assistant Attorney General




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