Untitled Texas Attorney General Opinion ( 1987 )

Honorable Gib Lewis Opinion No. JM-835
Speaker
Texas House of Representatives Re: Whether section 26.08
P. 0. Box 2910 of the Tax Code, which
Austin, Texas 78769 permits a tax rate roll-
back election to limit
school taxes, is unconsti-
tutional (RQ-1286)
Dear Speaker Lewis:
Section 26.08 of the Tax Code provides that if the
governing body of a school district adopts a tax rate that
exceeds the so-called "effective tax rate" calculated
pursuant to either section 26.04 or section 26.042 of the
Tax Code by more than eight percent, the qualified voters
of the taxing unit by petition may require that an
election be held to determine whether or not to reduce the
tax rate adopted for the current year to a rate that
exceeds the l'effective rate" by no more than eight
percent. See Attorney General Opinions JM-792 (1987);
JM-574 (1986). Section 26.085 of the Tax Code permits a
tax rate rollback election, limiting the percentage of the
total tax levy of a school district dedicated by the
governing body of the school district to a junior college
district under section 20.48(e) of the Education Code.
In Attorney General Opinion JM-792, we concluded that
section 26.07 of the Tax Code, which authorizes such a tax
rate rollback election for taxing units other than school
districts, is unconstitutional insofar as it applies to
counties. you ask whether sections 26.08 and 26.085 of
the Tax Code likewise are unconstitutional. We conclude
that they are not.
Section 26.08 of the Tax Code sets forth the follow-
ing relevant provisions:
(a) If the governing body of a school
district adopts a rate that exceeds the rate
calculated as provided by Section 26.04 of
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Honorable Gib Lewis - Page 2 (m-835)
this code by more than eight percent, the
qualified voters of the district by petition
may require that an election be held to ?
determine whether or not to limit the tax
rate the governing body may adopt for the
following year. . . .
. . . .
(e) If a majority of the qualified voters
voting on the question in the election favor
the proposition, the governing body may not
adopt a tax rate in the following year that
exceeds the rate calculated as provided by
Section 26.04 of this code for that year by
more than eight percent, except than in
making the calculation under Subsection Cd)
of Section 26.04 of this code, the assessor
shall use the amount of taxes determined as
provided by Subsection (c) of Section 26.04
of this code in the year in which the tax
increase th~at initiated the referendum
occurred rather than the year in which the
calculation occurs. ?
(f) For purposes of this section, local
tax funds dedicated to a junior college
district under Section 20.48(e), Texas
Education Code, shall be eliminated from the
calculation of the tax rate adopted by the
governing body of the school district. How-
ever, the funds dedicated to the junior
college district are subject to Section
26.085 of this code.
Section 26.085 of the Tax Code contains the following
relevant provisions:
(a) If the percentage of the total tax
levy of a school district dedicated by the
governing body of the school district to a
junior college district under Section
20.48(e), Texas Education Code, exceeds the
percentage of the total tax levy of the
school district for the preceding year
?
dedicated to the junior college district
under that section, the qualified voters of
the school district by petition may require
that an election be held to determine
?
whether to limit the percentage of the total
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Honorable Gib Lewis - Page 3 UM-835)
tax levy dedicated to the junior college
district to the same percentage as the per-
centage of the preceding yearts total tax
levy dedicated to the junior college
district.
. . . .
(e) If a majority of the qualified voters
voting on the question in the election favor
the proposition, the percentage of the total
tax levy of the school district for the year
to which the election applies dedicated to
the junior college district is reduced to
the same percentage of the total tax levy
that was dedicated to the junior college
district by the school district in the pre-
ceding year. . . .
In Attorney General Opinion JM-792 (1987), we
concluded that section 26.07 of the Tax Code, which
authorizes a tax rate rollback election under certain
circumstances for taxing units other than school
P districts, is unconstitutional insofar as it applies to
counties. We based our decision upon specific language in
article VIII, sections l-a and 9, of the Texas
Constitution that confers explicit authority on
commissioners courts to set tax rates and levy ad valorem
taxes upon property in the counties.
Article VIII, section l-a, of the Texas Constitution
contains the following relevant language:
Prom and after January 1, 1951, the several
counties of the State are authorized to levv
ad valorem ws unon all arovertv within
their resvective boundaries for countv
purnoses . . . not to exceed thirtv cents
(30C) on each One Hundred Dollars ($100)
valuation, in addition to all other ad
valorem taxes authorized bv the Constitution
of this State, provided the revenue derived
therefrom shall be used for construction and
maintenance of Farm To Market Roads or for
Flood Control, except as herein otherwise
p
. provided.
Article VIII, section 9, of the Texas Constitution sets
forth the following:
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Honorable Gib Lewis - Page 4 (JM-835)
[N]o county, city or town shall levy a E;t
rate in excess of Eighty Cents (SOC) on
One Hundred Dollars ($100) valuation in any
one (1) year for general fund, perman;;:
improvement fund, road and bridge fund
jury fund purposes: provided further that at
the time the Commissioners Court meets to
ew the annual tax rate for each countv it
-1 lew whatever tax rate mav be needed
for the four (4) constitutional Durnoses;
namely, general fund, permanent improvement
fund, road and bridge fund and jury fund so
long as the Court does not impair any
outstanding bonds or other obligations and
so long as the total of the foregoing tax
levies does not exceed Eighty Cents (8OC) on
the One Hundred Dollars ($100) valuation in
any one (1) year. (Emphasis added.)
We concluded that both provisions confer authority,
not on the voters, but on the commissioners court, and the
legislature by statute cannot remove governmental power
conferred by the constitution. Tex. Const. art. V, 518.
Se aenereJJy BBgerson v. Wood, 152 S.W.2d 1084 (Tex.
19L) ; Dodson v. Marshall, 118 S.W.2d 621 (Tex. Civ. APP.
- Waco 1938, writ dism'd). Because the legislature does
not have the power to enact any law contrary to a
provision of the constitution, Citv of ort Worth v.
Howerton, 236 S.W.2d 615 (Tex. 1951), we zoncluded that
section 26.07 of the Tax Code is unconstitutional insofar
as it applies to counties.
In answering your question, the first issue that we
must address is whether the relevant constitutional
provisions governing school districts confer the sort of
authority on the school districts' trustees that sections
l-a and 9 of article VIII confer on county commissioners
courts.
Article VII, section 1, of the Texas Constitution
sets forth the following:
Section 1. A general diffusion of knowledge
being essential to the preservation of the
liberties and rights of the people, it shall
be the dutv of the leaislature of the State
to establish and make suitable nrovision for
the suuvort and maintenance of an efficient
svstem of DubliC free schools. (Emphasis
added.)
p. 4016
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Honorable Gib Lewis - Page 5 Of-835)
Article VII, section 3, of the Texas Constitution contains
the following language:
* .
of taxes in all said districts and for the
Iggnaaement and control of the nublic school
or schools of such districts, whether such
districts are composed of territory wholly
within a county or in parts of two or more
counties, and the Legislature may authorize
an additional ad valorem tax to be levied
and collected within all school districts
heretofore formed or hereafter formed, for
the further maintenance of public free
schools, and for the erection and equipment
of school buildings therein: provided that a
majority of the qualified property taxpaying
voters of the district voting at an election
to be held for that purpose, shall vote such
tax not to exceed in any one year one
($1.00) dollar on the one hundred dollars
valuation of the property subject to
taxation in such district, but the
limitation upon the amount of school
district tax herein authorized shall not
apply to incorporated cities or towns
constituting separate and independent school
districts, nor to independent or common
school districts created by general or
special law.
The underscored language of article VII, section 3
does not directly authorize school districts to set tax
rates and levy property taxes. Instead, the provision
authorizes "the Legislature . . . to pass laws for the
assessment and collection of taxes in all said
districts. . . .'I See. e.a., Brown v. Truscott
Indenendent School District, 34 S.W.2d 837 (Tex. 1931):
Desdemona Indeoendent School District v. Howard, 34 S.W.Zd
840 (Tex. 1931); Cain v. Lumsden, 204 S.W. 115 (Tex. Civ.
App. - Amarillo 1918, no writ). A school district's
taxing authority is subject to the legislature's power to
enact laws setting tax rates and providing for the
assessment and collection of taxes. Section 26.08 of the
Tax Code is such a law.
It has been suggested that article VII, section 3-b
of the Texas Constitution confers upon school trustees
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Honorable Gib Lewis - Page 6 (JM-835)
?
authority which cannot be circumscribed by section 26.08
of the Tax Code. We disagree.
?
Article VII, section 3-b, of the Texas Constitution
provides the following:
Sec. 3-b. No tax for the maintenance of
public free schools voted in any independent
school district and no tax for the
maintenance of a junior college voted by a
junior college district, nor any bonds voted
in any such district, but unissued, shall be
abrogated, cancelled invalidated by
change of any kind Ti the boundaries
thereof. After any change in boundaries,
the governing body of any such district,
without the necessity of an additional
election, shall have the power to assess,
levy and collect ad valorem taxes on all
taxable property within the boundaries of
the district as changed, . . . in the
amount, at the rate, or not to exceed the
rate, and in the manner authorized in the
district prior to the change in its bound- 1
aries, and further in accordance with the
laws under which all such bonds,
respectively, were voted. . . .
By its very terms, article VII, section 3-b, applies
only in those instances in which there has been a change
in a school district's boundaries. The amendment, as
originally adopted in 1962, was intended to validate bonds
issued by school districts in Dallas County whose
boundaries had been changed. Acts 1961, 57th Leg., S.J.R.
No. 6, at 1301. Section 3-b was amended in 1966 to apply
to all counties and to include specifically junior
colleges. Acts 1965, 59th Leg., H.J.R. No. 65, at 2230.
In the only supreme court case construing article
VII, section 3-b, the Texas Supreme Court declared:
This constitutional provision was added in
1966 to eliminate the need for new voter
approval of bonds and taxes when authorized
changes are made in the boundaries of school ?
districts. Once taxation h b
authorized. a chancre in the school dyzn
trict's
power to tax.
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Honorable Gib Lewis - Page 7 (JM-835)
. . . .
P Article VII, section 3-b authorizes
independent school districts to tax for
school purposes in those instances in which
the subject district was formed wholly by
disannexation from an existing independent
school district that possessed the power to
tax. (Emphasis added.)
. .
Fr 001 Di ic naes, 677
S.z?2d y88 at 490 (Tex. li84). In other words, article
VII, section 3-b, authorizes taxation without the holding
of an election to authorize such taxation as required by
article VII, section 1, in those instances in which taxa-
tion has alreadv been authorized by the requisite number
of voters. It does not transfer to school districts any
power conferred upon the legislature by article VII,
section 3. We conclude that section 26.08 of the Tax Code
is not inconsistent with article VII, sections 3 and 3-b,
of the Texas Constitution.
It is also urged that section 26.08 of the Tax Code
P unconstitutionally violates article III, section 1, of the
Texas Constitution, by effecting an improper delegation of
legislative authority, and article I, section 28, of the
Texas Constitution, by effecting a suspension of the laws.
It is urged that section 26.08 improperly delegates to the
voters the authority to set tax rates and improperly
suspends section 26.05 of ,the Tax Code, which authorizes
the governing body of taxing units to adopt a tax rate.
We now turn to these constitutional provisions.
Article III, section 1, of the Texas Constitution
provides: "The Legislative power of this State shall be
vested in a Senate and House of Representatives, which
together shall be styled 'The Legislature of the State of
Texas. fI1 Article I, section 28, of the Texas Constitution
provides the following: "No power of suspending laws in
this State shall be exercised except by the Legislature."
It is a maxim of constitutional law that the power
conferred upon the legislature to make the laws cannot be
delegated by that department to any other body or
authority. *
Te s a 'o Mccraw,
126 S.W.2d 627 (Tex. 1939); Brown v. Humble Oil h Refininq
co., 83 S.W.2d 935 (Tex. 1935), r eh earina denied 87
S.W.2d 1069 (Tex. 1935). The principle of non-delegition
has certain important qualifications. See aenerally
Annot., "Permissible limits of delegation of legislative
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Honorable Gib Lewis - Page 8 (JM-835)
power," 79 L. Ed. 474 (1935). For example, the legisla-
ture may delegate to municipalities local legislative
power that is adequate to carry out the purposes for which
they were created. See. e.a., Stanfield v. State, 18 S.W.
577 (Tex. 1892). The United States Supreme Court declared
almost a century ago:
It is a cardinal principle of our system
of government that local affairs shall be
managed by local authorities, and general
affairs by the central authority, and hence,
while the rule is also fundamental that the
power to make laws cannot be delegated, the
creation of municipalities exercising local
self-government has never been held to
trench upon that rule. Such legislation is
not regarded as a transfer of general legis-
lativs power, but rather as the grant of the
authority to prescribe local regulations,
according to immemorial practice, subject,
of course, to the interposition of the
superior in cases of necessity.
Stoutenbauah v. l?ennic&, 129 U.S. 141 (1889).
Article III, section 1, of the Texas Constitution
requires that a law must be so complete in all of its
terms and provisions when it leaves the legislative branch
that nothing is left to the judgment of the recipient of
the delegated power. See. e.a., Commissioners Court of
Lubbock County v. Martin, 471 S.W.2d 100 (Tex. Civ. App. -
Amarillo 1971, writ ref'd n.r.e.); Gerst v. Jefferson
Countv Savinas and I~$oanAss'n, 390 S.W.2d 318 (Tex. Civ.
APP. - Austin 1965, writ ref'd n.r.e.). The rights,
duties, privileges, or obligations granted or imposed must
be definitely fixed or determined, or the rules by which
they are to be fixed and determined must be clearly and
definitely established, when the act is pass-d. &L The
test is whether the legislature has prescribed sufficient
standards to guide the discretion conferred. commission-
ers Court of Lubbock Countv v. Martin, sunra; Moodv v.
Citv of UnG' itv.&?&, 278 S.W.Zd 912 (Tex. Civ. App. -
Dallas 1955, writ ref'd n.r.e.).
Section 26.09 clearly sets forth sufficient standards
?
both with regard to the calling of an election and with
regard to the consequences if an election were successful:
whatever discretion is set forth in the section relates
only to its execution. Texas courts have upheld, under
article VII, section 3, of the Texas Constitution, the ?
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Honorable Gib Lewis - Page 9 (JM-835)
authority of the legislature to create school districts,
Frass v.-Darrouzett I.&l is ict, 277 S.W.
751 ITex. Civ. ADD. - Amarillo 1926, no writ): to chanae
their boundaries;-Tad Citv of Houston, i76 S.W. 419
(Tex. 1925); to enactV curative statutes validating a
vf o
district's existence, L ee
V. illamar Indenendent School District, 34 S.W.2d 854
(Te:. 1931) ; and to delegate to boards of trustees the
authority to maintain public schools. Weaarael County
Line Indeoendent School District v. Blewett, 278 S.W. 516
(Tex. Civ. App. - Fort Worth 1926), m, 285 S.W. 271
(Tex. 1926). We see no reason why the legislature could
not also delegate to voters the authority to compel the
boards of trustees of school districts to reduce adopted
tax rates upon a successful rollback election.
While the results of early Texas cases are inconsis-
tent, see, e.a., State Swisher 17 Tex. 441 (1856) and
Stanfield v . tate 18v.S.W. 577' (Tex. 1892), at least
since 1920, Texas &urts have upheld delegations of auth-
ority to voters or some other body in instances in which a
statute whose complete execution and application to the
subject matter was made to depend on the assent of those
voters or some other body. @S Trimmier v. Carlton, 296
S.W. 1070 (Tex. 1927); SDears, 223
S.W. 166 (Tex. 1920); D c e at'0 of
Aaencies Othe Than State Administrative Bodies, 16 Tex.
L. Rev. 494r (1937). Analogously, we conclude that
sections 26.08 and 26.085 effect no impermissible
delegation of legislative authority in violation of
article III, section 1, of the Texas Constitution.
The prohibition in article I, section 28, of the
suspension of laws unless it is done by the legislature is
frequently invoked when analyzing delegations of this
sort. See, e.a., Attorney General Opinion H-1080 (1977);
16 Tex. L. Rev. 494, sunra. It is urged that sections
26.08 and 26.085 of the Tax Code effectively suspend
section 26.05, which authorizes the governing bodies of
taxing units to adopt tax rates. If sections 26.08 and
26.085 actually provided that section 26.05 be
inapplicable in those taxing units in which a successful
rollback election occurred, perhaps an article I, section
28, argument could be made. But sections 26.08 and 26.085
do not so operate. The relevant provisions of subsection
(e) of section 26.08 provides:
If a majority of the qualified voters voting
on the question in the election favor the
proposition, the aovernina bodv mav not
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Honorable Gib Lewis - Page 10' (JM-835)
ado& a tax rate in the following year QI&
calculated as provided by
- . P-J mor t an eiaht -3
percent. . . . *(&hasis addzd.jh
Section 26.085 also contains the underscored language.
Section 26.08 and 26.085 do not effect any suspension of
the governing body‘s authority to adopt a tax rate; they
merely place a one-year ceiling or limitation on the rate
that a governing body may adopt. The power to adopt a
rate is still reposed with the governing body of a taxing
unit, even in the event that a rollback election is
successful. We conclude that sections 26.08 and 26.085 do
not violate article I, section 28.
SUMMARY
Sections 26.08 and 26.085 of the Tax
Code, which authorize ad valorem tax rate
rollback elections for school taxes, are
constitutional.
L/ )rl.JGc
Very truly yo ,
?
n;,
JIM MATTOX
Attorney General of Texas
MARYKELLER
Executive Assistant Attorney General
JUDGE ZOLLIE STEAKLKY
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by Jim Moellinger
Assistant Attorney General
p. 4022