Untitled Texas Attorney General Opinion ( 1957 )

. . ”
’
THEATRY-ORNEY GENEKAL
OF TEXAS
WILL WIJBON
A’ITORNEY GENEHAL
October 7, 1957
Hon. Robert S. Calvert Opdnion.No.WW-270
Comptroller of Public Accounts : ~, ;~
Capitol Station & ; Whe.the,ror not the W: ,T.
Austin 11, Texas Grant Company, Dallas,
Texas; is subject to
taxation under the lease-
hold agreement referred
Dear Mr. Calvert: to in Article 7173, R.C.S.
You request the opinion of this office upon.the ad
valorem taxablllty.ofthe lease-hold estate of W.,T. Grant
Company In certain real estate located An Dallas, Texas, in::
which the University of Texas Is the lessor and W. T. Grant
Company is the lessee.
You submittedwith your request a copy of the lease
involved. It is dated December 12, 19?6,,and expires June 30,
1959. The real property,coveredby the lease is concededly
State-ownedproperty and since it is for a term of more than
three years its taxabllity is governed,byArticle 7173, Vernon's
Civil Statutes, which provides in,part~,.as
followg:
"Property held under a lease for a
term of three years or more, orheld
under a contract for the purchase there-
of, belonging to :thisState, or that is
exempt by law from taxation in the hands
of the owner thereof, shall be considered
for all the purposes of taxation, as the
property of the pers,onso holding the same,
except as otherwise specificallyprovided
by law."
This Statute was construed by the Supreme Court of
this State In the case of Tramwell v. Faught, Tax Collector,
74 Tex. 557, 12 S.W.317, as applicable to the lease-hold estate
and not to ownership of the fee In the following language.which
we quote from the opinion:
. II .If appellant had held the
lands kder an absolute lease for a
term of three years or more, his lease-
hold estate would have beensubject to '~ ~';, '~ ,~
-
-- ’
Hon. Robert S. Calvert, Page 2 (W-270)
taxation upon such value as it would
bring at a fair voluntary sale for cash,
but he would not have been liable to
taxes upon the value of the freehold
estate in the lands."
Our research does not reveal that this ruling of the
Supreme Court has been departed'from. Article 717&j V.C.S.
provides how such lease-hold estate shall be valued. This
Statute provides lfi'partas follows:
"Taxable leasehold estates shall
be valued at such a price as they would
bring at a fair voluntary sale for cash."
You are, therefore,respectfullyadvised that the
lease-hold estate of W. T. Grant Company In the real property
In question is subject to ad valorem taxes,and,thevalue
should be ascertainedas provided In Article 7174, V.C.S;
,.)
SUMMARY ,:,I,
:.,
A lease-hold estate of the ~lesseein
property owned by the Statewhich is
for a term of three or more years is
subject to ad valorem taxation;- The
value Should be ascertalned,as.provided
In Article 7174, V.C.S.
Very truly yours,
WILL WILSON
Attorney General
LPL:gs
APPROVED: !" 4,&e b/J
By "(i,\
OPINION COMMITTEE L. P. Lolla
Geo. P. Blackburn,Chairman A,sslstant
Joe Rollins
J. Milton Richardson "
B. H. Timmins, Jr.
Houghton Brownlee,.J??.
REVIEWED FOR THE ATTORNEY GENERAL
By:
James N. Ludlum