Untitled Texas Attorney General Opinion ( 1949 )

. .
OF ?rExAs
Awwrnv 11. TExAe
PRICE DANIEL
ATTORNEY GENERA,.
October 5, 1949
Hon. J. E. McDonald, Commissioner
Department of Agriculture
Austin, Texas Opinion No. V-922
Re: The constltut1onal1ty of
that part of House Bill
29, Acts 51st Legislature,
R.S.,1949, which empowers
the Texas Citrus Commission
to fix a tax levled on the
processing and sale of clt-
rus fruit.
Dear Mr. McDonald:
By letter dated July 28th you have requested
the opinion of this office on the following matter:
"The 51st Legislature of Texas created
a governmental agency, to be known as the Texas
Citrus Commission, under an act known as House
Bill lo. 29.
"Under Section 14, the bill levies a tax
of 3&per l-3/5 bushel unit to be collected
and used in part for advertlslng purposes.
%ectlon 17 of said act makes It the duty
of the Commissioner of Agriculture of the State
of Texas to collect said tax and remit same to
the Texas Citrus Commlsslon.
I,. . .
"In view of the nearness of the citrus
harvesting season, I respectfully request your
opinion as to the constltutionallty of that
part of the act which Imposes a tax on clt:us
fruit to be used for advertising purposes.
The Texas Citrus Commission was created and its
authority was defined by the 51st Legislature, R.S., 1949,
ch. 93, p. 150. It has as Its motivating function the regu-
lation of the Texas citrus fruit Industry. To finance the
regulatory measure and to provide funds for the accomp-
. .
Hon. J. E. McDonald, page 2 (V-922)
llslnaentof the authorized powers of the Commission, a
tax was levied in the Act 'upon all citrus fruit grown
In the State of Texas and packed or placed In containers
and marketed, or processed and sold between September 1st
of each year and August 31st of the following year."
We set out the portions of the Act which pertain
to the tax In question, as follows:
"Sec. 9. The Texas Citrus Commission In
addition to those elsewhere enumerated, shall
have the following powers:
"(1) To establish and maintain executive
offices at such place within the citrus pro-
ducing area of the State of Texas as It may
from time to time select. The location of
such executive offices may from time to time
be changed by the Commission.
"(2) To employ and at Its pleasure dls-
charge experts, agents and such other employees,
persons,flrms and corporations as It may deem
necessary and to fix their respective duties
and compensation. Provided however, that all
compensation proposed to be expended under
said paragraph (2) shall be first approved by
the Legislative Audit Committee.
altez(3) To adopt and from time to time to
rescind, modify or amend all proper and
necesiary bylaws, rules, regulations and orders
for the exercise of Its powers and the perform-
ance of Its duties under this Act, and to de-
fine more precisely the terms and words used in
this Act and the appllcablllty thereof to specl-
flc facts and circumstances and to prevent by
orders, rules and regulations the evasion of
the taxes as well as the other acts, rules and
regulations of the Commission, which such rules,
regulations and orders as so adopted, resclnd-
ed, modified or amended shall have the force
and effect of law when not Inconsistent with
existing laws.
"(4) To act as the general supervisory
authority over the administration and en-
forcement of this Act and the provisions there-
Hon. J. E. McDonald, page 3 (v-922)
of and to exercise such other powers and to per-
form such other duties as may be now or here-
after Imposed upon it by law.
“(5) To purchase all necessary office equlp-
ment, furniture and supplies and to make such
contracts and Incur such expenses as may be ne-
cessary or desirable to properly carry out its
duties.
“(6) To conduct directly or through such
lnstrumentalltles or agencies as It may select,
publicity and advertising programs and sales
campaigns designed to Increase the sale and
consumption of Texas citrus fruit and by-pro-
ducts In an amount not to exceed one-half of
the revenue of the Commission In any one year;
to carry on research either directly or through
such lnstrumentalltles or agencies as it may se-
lect, for the purposes of Increasing knowledge
with respect to Texas citrus fruits and by-pro-
ducts and protecting Texas citrus from pests and
dleases and of finding new uses for Texas cit-
rus fruit and by-products and of improving the
quality and yield of such fruit and by-products.
No advertising or sales promotion campaign shall
be directed towards promotion of the brands or
trade names belonging to any particular person,
firm or corporation, except as hereinafter pro-
vided.
own ,``;bTol~;~;;, change, modify, register and
trade marks, trade names, and
copyrlghts'for use'ln connection with Texas cit-
rus fruits and by-products and to adopt, alter,
amend, and rescind rules and regulations govern-
ing the quality, kind and grade of products us-
ing same and conditions of such use and to pro-
hibit the use of such brands, labels, trade-
marks, trade names and copyrights In connection
with products which do not comply with such rules
and regulations. All such brands, labels, trade-
marks, trade names and copyrights shall be open
to use by all producers of Texas citrus fruit and
by-products who comply with the rules and regula-
tions promulgated by the Commission with respect
thereto.
“(8) To borrow money for the purpose of car-
rying on the functions for which the Commission
Hon. J. E. McDonald, page 4 (V-922)
was created, but no loan shall be for a great-
er amount than the reasonably anticipated rev-
enues of the Commission for the zurrent crop
year In which such loan Is made.
II. . .
"Sec. 14. There Is hereby levied and as-
sessed and there shall be collected, at the
times and In mani,erand from the persons, firms,
associations and corporations herein provided,
a tax In such amount r?t to exceed Three Cents
(3#) per standard packed box or bag of one and
three-fifths (1 3/5) bushels or equivalent, as
the Texas Citrus Commission may annually fix
and certify to the Commissioner of Agriculture
of the State of Texas on or prior to September
1st of each year.
"With the exceptions herein provided, said
tax at said rate Is hereby levied and assessed
and shall be collected as herein provided, upon
all citrus fruit grown in the State of Texas and
packed or placed in containers and marketed, or
processed and sold between September 1 of each
year and August )lst of the following year. If
any citrus fruit shall be placed In containers
or packed or processed In the State of Texas be-
tween September 1st of one year and August 3lst
of the following year but not sold until after
the next September lst, upon such sale it shall
be taxed at the rate fixed by the Commission on
or before the September 1st Immediately preced-
ing such sale.
"For the urpose of.computing such tax,
twenty-four (2t ) units of No. 2 cans of process-
ed citrus fruit shall be equivalent to a stand-
ard packed box or bag of one and three-fifths
(1 3/5) bushels of fresh fruit and shall be tax-
ed In the same amount as such standard packed
box; twelve (12) units of No. 3 cans of process-
ed citrus fruit shall be taxed at a rate one and
twenty-six one hundredths (1.26) times the amount
of tax for a standard packed box: six (6) units
of No. 10 cans of processed citrus l‘ruitshall be
taxed in the amount one and thirty-three one hun-
dredths (1.33) times the tax for a standard pack-
ed box; seventy-two (72) units of SIX (6) ounce
Hon. J. E. McDonald, page 5 (V-922)
cans of processed citrus fruit shall be equlv-
alent to a standard packed box of fresh fruit
and shall be taxed In the same amount; each
one and three-fifths (1 3/5) bushel Bruce or
wire-bound type box of fresh fruit shall be
equivalent to a standard packed box of fresh
fruit and shall be taxed In the same amount;
each box, basket or bag containing approxl-
mately four-fifths (4/5) bushel of fresh fruit
shall be taxed In an amount equal to one-half
(l/2) the tax for a standard packed box; each
box, basket or bag containing approximately
two-fifths (2/5) bushel of fresh fruit shall
be taxed in an amount equal to one-fourth
(l/4) the tax for a standard packed box; each
basket or bag containing approximately one (1)
bushel of fresh fruit shall be taxed In an a-
mount equal to sixty-two and one-half per cent
(6293) of the tax on a standard packed box:
each box, basket or bag containing one-half
(*) bushel of fresh fruit shall be taxed in an
amount equal to thirty-one and twenty-five one
hundredths per cent (31.25%) of the tax on a
standard packed box; eight (8) bags containing
approximately one-fifth (l/5) bushel each of
fresh fruit shall be equivalent to a standard
packed box and shall be taxed in the same a-
mount; ten (10) eight (8) pound bags of fresh
fruit shall be equivalent to a standard packed
box of fresh fruit and shall be taxed In the
same amount; sixteen (16) five (5) pound bags
of fresh fruit shall be equivalent to a stand-
ard packed box and shall he taxed In the same
amount; four and one-half (4$) gallons of single
strength citrus fruit juice or other processed
citrus fruit shall be equivalent to a standard
packed box of fresh fruit and shall be taxed in
the same amount;eighty (80) pounds of fresh
fruit In bulk shall be the equivalent of a stand-
ard packed box and shall be taxed In the same a-
mount as such standard packed box.
“For the purpose of computing such tax on
other containers of fresh and processed Texas
citrus fruit, and enforcing the collection of
the taxes herein levied, the Texas Citrus Com-
mission is authorized, empowered and directed
to adopt rules and regulations to prevent
Hon. J. E. McDonald, page 6 (‘J-922)
evasion and ensure collection and defining what
is the equivalent of a standard packed box of
fresh fruit, and the proportion of the tax as
levied per standard packed box which shall be
paid on such other forms and containers of
fresh and processed Texas citrus fruit.
“It Is provided however that the tax levied
from year to year pursuant to the terms and pro-
visions hereof shall not be due and payable by
any natural person as to Texas citrus fruit grown
on land owned by such person and packed and sold
by such person as fresh fruit or as to such fruit
so grown on such land and processed and sold by
such person. Each such natural person claiming
an exemption under the provisions hereof, shall,
before becoming entitled thereto, file an appllca-
tlon for such exemption and receive an exemption
certificate from Texas Citrus Commission at the
time and In the manner hereinafter provided.
“Sec. 15. The taxes authorized by the pre-
cedln Section of this Act shall be due and pay-
able 7with the exceptions therein set out) by
the persons, firms or corporations packing or
placing same in containers and marketing such
fresh citrus fruit or processing and selling ‘~,
such processed citrus fruit and citrus fruit by-,
products, to the Texas Citrus Commission at Its
executive offices, on the 15th day of the calendar
month following the packing or placing In contaln-
ers and marketing of the fresh citrus fruit Or
the processing and sale of the proceased citrus
fruit and by-products, to which such taxes are
applicable. Same shall bear Inter&t at the rate
of ten perzentum (10%) per annum from and after
the due date thereof until paid, and ohs11 be per-
sonal obligations and claims against each person;
firm and corporation who packs or places In con-
tainers and markets or processes and sells or PUP-
chases all or any part of such fresh citrus fruit
aftep It Is packed for market or such processed
fruit and by-products after same are processed.
Ali persons, firms and corporations who shall
sell or purchase any fresh or processed Citrus
fruit and by-products upon which such tax is or _~
may becane due, shall keep such records and ac-
counts and make such periodic reports of dealings
In fresh and processed citrus fruit and by-products
Hon. J. E. McDonald, page 7 (V-922)
as the Texas Citrus Commission may from time to
time prescribe.
11 . . .
'Sec. l?- The Commissioner of Agriculture
of the State of Texas, and his assistants, em-
ployees and agents are hereby authorized, empow-
ered and directed at the request of the Texas
Citrus Commission and without additional compen-
sation to collect the taxes Imposed by this Act
and to remit same to said Commission as herein
provided and to otherwise assist the Commission
In the enforcement of this Act and rules and re-
gulations promulgated hereunder. They shall make
from time to time such reports of their collections
and remittances and other activities in the en-
forcement hereof as may be required by said Texas
Citrus Commlsslon. Said Texas Citrus Commission
may also employ additional agents and representa-
tives for the collection of said taxes, and to
assist In the enforcement hereof.
"The Texas Citrus Commission may require
any or all persons who handle money or are respon-
sible for collecting the taxes herein levied to
give bond for the faithful and honest performance
of their duties In such form and amount as may be
prescribed by the Commission and the premiums on
such bonds may be paid by the person giving same
or from funds of the Texas Citrus Commission, as
It may prescribe.
'Sec. 18. There Is hereby created In the
Treasury of the State of Texas three special fwds
which shall be continuing funds, to be known as
follows:
" 1 . Texas Citrus Commission Fund.
2 . Agricultural and Mechanical College
"[I
of Texas-Weslaco Experiment Station No. 15 Clt-
rus vd.
exas College of Arts and Industries
Cltrus(&d?
"All moneys collected from the taxes levied
from time to time pursuant to the provisions of
this Act shall be turned over to the Texas CitPuS
c
Hon. J. E. McDonald, page 8, (V-922)
Commission, Its officers and agents, and by
said Commission forwarded to the Comptroller to
be deposited by him with the State Treasurer of
the State of Texas, three-fourths (3/h) thereof
In said Texas Citrus Commission Fund, one-eighth
(l/8) thereof In said Agricultural and Mechanl-
cal College of Texas-Weslaco Experiment Station
No. 15 Citrus Fund and one-eighth thereof In
said Texas College of Arts and Industries Clt-
rus Fund and the proceeds of such taxes In said
funds shall be appropriated by the Legislature
of the State of Texas for the purposes herein
named and for no other purpose.
"The entire amount of said Texas Citrus Com-
mission Fund for the biennium ending August 31,
1951, Is hereby appropriated to said Texas Clt-
rus Commission, to be used by It for the pur-
poses specified In this Act Including the en-
forcement of this Act and cost of collecting
said taxes. The entire amount of said Agrlcul-
tural and Mechanical College of Texas-Weslaco
Experiment Station No. 15 Citrus Fund and of
said Texas College of Arts and Industries Clt-
rus Fund for the biennium ending August 31, 1951,
are hereby appropriated to the Agricultural and
Mechanical College of Texas, Texas Agricultural
Experiment Station System-Weslaco Experiment
Station No. 15 and Texas College of Arts and In-
dustries, each respectively to be used by said
respective institutions In education and research
for the purpose of Increasing knowledge with re-
spect to Texas citrus fruits and by-products,
and protecting Texas citrus fruits from pests
and diseases and of finding new uses for Texas
citrus fruits and by-products and of improving
the quality and yield of such fruit and by-pro-
ducts.
'varrants shall be drawn by ,theComptroller
of Public Accounts of the State of Texas, against
said respective funds as provided-by law.
11. . .
'Sec. 20. This Act Is passed for the purpdse
of preventing economic waste of food and loss of
property and natural resources of this State and
Hon. J. E. McDonald, page 9 (V-922)
to encourage and foster the development of a
major Industry, the Texas citrus Industry by
fostering research as to new uses; by prevent-
ing destruction thereof by pests and diseases
and by lmprovlng the quality of and stlmulat-
lng demand for, such Texas citrus fruit and
by-products produced therefrom. Lack of such
fostering care for such Industry has in the
past and will In the future (unless prevented)
result In unnecessary and avoidable waste of
an important resource of this State. Such loss
and waste will imperil the ability of producers
of Texas citrus fruit to contribute In appro-
priate amounts to the support of ordinary gov-
ernmental and educational functions, and ln-
crease the tax burdens of other citizens for
the same purposes. Hence this Act Is passed
to further the public welfare and general pros-
perity of the State of Texas."
We shall, In the course of this opinion, resolve
the constitutionality of the tax Imposed by the Act with
respect to whether the tax Is for a "public purpose' wlth-
In the constitutional requirement of Article VIII, Section
3, of the Texas Constltutlon,and as to whether the delega-
tion of authority to the Texas Citrus Commission In con-
nection with determining the amount of the tax constitutes
an unconstitutional delegatlon of legislative authority
violative of Article II, Section I, and Article III, Sec-
tion 48, of the Texas Constitution.
(1) Is the tax for a "public purpose" within the
constitutional requirement of Article VIII, 3ectlon 5 of
the exas
T
It Is provided in Article VIII, Section 3 of the
Texas Constitution that:
'Taxes shall be levied and COllQCtQd by
general laws and for public purposes only."
The functions of the Texas Citrus Commlsslon are
enumerated in Section 9 of the Act, set out heretofore. In
addition to the usual administrative functions of operating
physical facilities and employing personnel as well as of
furthering Its regulatory powers, the Commission has specl-
flc authority to conduct advertising campaigns to foster
and promote the citrus Industry. To this particular au-
thority the following discussion will be principally devot-
Hon. J. E. McDonald, page 10 (V-922)
ed, as Its character as a public purpose Is the most con-
troversial of the enumerated powers in so far as the tax
revenue's expenditure thereon Is concerned.
The requirement that taxation be for a "public
purpose" Is fundamental to the jurisprudence of this coun-
try, and Its necessity has been Incorporated In the constl-
tutlons of most of the States of the union. It has, there-
fore, occasioned much judicial lnterpretatl?n to determine
what Is within the field of authorized taxation. The volume
of judicial constructions of what constitutes a "public pur-
pose* within the inhibitory provisions has proven enllght-
enlng and we shall, through the course of this opinion, set
out those expressions which we feel most nearly embody a
recognizable rule.
The determlnatlon of whether a given object of
taxation Is for a *public purpose'tis governed, In the
light of existing authorities, by custom and usage to a
great extent. No precise holding in Texas has been founds
holding that a tax on citrus fruit for the purposes en-
umerated In the Act in question Is not for a public pur-
pose.
General tests, however, seem to be well estab-
lished.
It Is said in 1 Cooley on Constitutional Limlta-
tions (8th ed.,1927) 264, that:
"The Legislature is to make laws for the
public good, and not for the benefit of lndlvl-
duals. It has con\trolof the public moneys and
should provide for disbursing them only for pub-
lic purposes. Taxes should only be levied for
those purposes which properly constitute a pub-
lic burden. But what Is for the public good,
and what are public purposes, and what does pro-
perly cotistltutea public burden, are questions
which the legislature must decide upon Its own
judgment, and In respect to which It Is vested
with a large discretion which cannot be controll-
ed by the courts, except, perhaps, where Its ac-
tion Is clearly evasive, and where, under pre-
tense of a lawful authority, it has assumed to
exercise one that is unlawful."
The United States Supreme Court has spoken on the
problem often and foPcefully. In Savings and &an Assocla-
tlon v. Topeka, 22 U.S. 455, 20 Wall. 655, It was said:
Hon. J. E. McDonald, page 11 (V-922)
"To lay, with one hand, the power of the
government on the property of the citizen, and
with the other to bestow It upon favored ln-
dlviduals to aid private enterprises and build
up private fortunes, Is none the less a robbery
because It Is done under the forms of law and
Is called taxation. This Is not legislation.
It is a decree under legislative forms.
I,. . .
"We have established, we think, beyond
cavil, that there can be no lawful tax which
Is not laid for a public purpose. It may not
be easy to draw the line In all cases so as
to decide what is a public purpose In this
sense and what Is not.
"It Is undoubtedly the duty of the Legis-
lature which Imposes or authorizes munlclpall-
ties to Impose a tax, to see that It Is not to
be used for purposes of private Interest ln-
stead of a public use, and the courts can only
be justified In Interposing when a violation of
this principle Is clear and the reason for ln-
terference cogent. And in deciding whether, In
the given case, the object for which the taxes
are assessed falls upon the one side or the
other of this line, they must be governed maln-
ly by the course and usage of the government,
the objects for which taxes have been custom-
arily and by long course of legislation levied,
what objects or purposes have been considered
necessary to the support and for the proper
use of the government, whether State or munlcl-
pal. Whatever lawfully pertains to this and is
sanctioned by time and the acquiescence of the
people may well be held to belong to the public
use, and proper for the maintenance of good
government, though this may not,,bethe only
criterion of rightful taxation.
In Waples v. Marrast, 108 Tex. 5, 184 S.W.180
(1916), the question of whether the requirement of the ex-
penditure of county funds for the holding of Darts DrimarY
elections was for a"publlc purpose" was Involved. It was
there said by Chief-Justice Phillips that:
"Taxes are burdens imposed for the support
of the government. They are laid as a means of
Hon. J. E. McDonald, page 12 (V-922)
providing public revenues for public purposes.
The sovereign power of the State may be exer-
cised In their levy and collection only upon
the condition that they shall be devoted to
such purposes; and no lawful tax can be laid
for a different purpose. Whenever they are Im-
posed for private purposes, as was said In
Brodhead v. Milwaukee, 19 Wls. 670, 88 Am. Dec.
711, it ceases to be taxation and becomes plund-
er.
"It Is not easy to state In exact terms
what is a 'public purpose' In the sense in
which t&t term Is employed as a llmltatlon
upon the State's power of taxation. The fram-
ers of the Constitution were doubtless sensible
of this difficulty, for they did not attempt to
define It. Many objects may be public In the
general sense that their attainment will con-
fer a public benefit or promote the public con-
venience, but not be public In the sense that
the taxing power of the State may be used to ac-
complish them. The powers of the State as a
sovereignty exist only for government purposes.
They may be freely exerted In the discharge of
all the governmental functions of the State; but
cannot be applied to uses, though public ln aim
and result, which are not governmental In their
nature. As the means provided for the support of
the government in Its administrative duties and
existing alone for that end, the taxing power
may be employed for no purpose save that which
In a true and just sense Is related to the per-
formance by the State of Its governmental office.
The appropriation of the public revenue is a
legislative power, and the Legislature must ne-
cessarily be allowed a large discretion In de-
termining to what uses public moneys may be put.
Subject to the constitutional llmltatlon that
the public revenue shall be applied to only pub-
lic purposes, to the prudent husbandry of the
Legislature as well as Its provident foresight
has been committed the public trust of making
such use of It as will afford the economical ad-
ministration of the government which both the
spirit and the letter of the Constitution en-
join. The term 'public purpose' as used In this
relation Is not, therefore, to be construed nar-
rowly, so as to deny authority to the Legislature
Hon. J. E. McDonald, page 13 (v-922)
to make such provision for the admlnlstratlon
and support of the government In Its several
branches and subdivisions as will faithfully
subserve the present and future Interests of
the people. The llmltatlon imposed by the
Constitution upon the power Is, however, lmpera-
tlve. And It Is essentially true that It does
not permit taxation for all purposes which In a
broad and general sense may be regarded as pub-
lic, but expressly confines Its exercises to on-
ly those public purposes with which the State,
as a government, Invested with high and sover-
eign powers, but only as a grant from the people
and therefore to be solely used for the common
benefit of all of them, and not as a paternal
institution, may justly concern Itself, and to
which, for that reason, the public revenues may
be rightfully devoted.
"As to what Is a public purpose within the
meaning of Section 3, Article 8 of the Constltu-
tlon, no better test can be presented than the
Inquiry: Is the thing to be furthered by the
appropriation of the public revenue somethlnq
which it Is the duty of the State, as a govern-
ment to provide? Loan Association v. Topeka, ??O
16 L. Ed. 455. People v.Town of Salem,
2801M;ch?545``4‘Am. Rep: 400. Those things which
It Is the duty of the State to provide for the
people, it Is equally the right of the State, by
means of the public revenue, to maintain. Wlth-
in this category fall the general lnstrumental-
ltles of the government, the public schools,
and other Institutions of like nature. But
the State is wholly without any power to levy
and appropriate taxes for the support of those
things which, either by common usage or because
they are In no proper sense the Instruments of
government, it is the duty of the people to pro-
vide for themselves. It Is not all things which
answer a public need or fill a public want that
it Is within the authority of the State to fur-
nish for the people's use or support at the pub-
lic expense. Manufacturing industries, railroads,
public enterprises of many kinds, private schools
and private charitable Institutions all afford a
service to the public, but the State Is without
any power to maintain them. Religon Is generally
Hon. J. E. McDonald, page 14 (V-922)
esteemed a helpful influence for public moral-
ity. But the Constitution expressly declares
that no public money shall be sranted In aid
of any religious organization. (Emphasis
supplied throughout this opinion)
In Neal v. Boou-Scott, 247 S.W. 689 (Tex.Clv.App.
1923), the court was passing on a tick eradication law as
being in contravention of the “public purpose” requirement
of Article VIII, Section 3, wherein the exuense of enforce-
ment was required by the law to be paid out of county funds.
The Court held:
“The question as to whether an act of the
Legislature of this state will serve a public
use or purpose is, in the first instance, a
question for the determination of the Leglsla-
ture, and that determination or decision can-
not be reviewed and the contrary determined by
the judiciary except In instances where the
legislative determination of the question Is
palpably and manifestly arbitrary and lncor-
rect.”
The Texas courts have held that the following
functions were within the “public purpose” requirement:
the levy of taxes by a municipality for a Board of City
Develooment authorized to soend Its funds to advertise
the advantages of the city,- Ilavisv. City of Taylor,
123 Tex. 39, 67 S.W. 2d 1033:(1934);the levy of taxes
for the construction of highways, Tom Green County v.
Moody, 116 Tex. 299, 289 S.W. 381 11926);the levy of
taxes to establish and maintain a munlciual band.
Gr 118 Text 207 lj S.W.
% 353 (19:6); the levy of taxes for the pay&t of
bounties for the destruction of wolves, Weaver v.
Scurry County 28 S.W. 836 (Tex. Clv. App. 1894) An
annotation of’value Is to be found In 112 A.L.R.‘571.
We attach weiaht to the lucid exoression of the
considerations i&lved in determining what Is a
“public purpose” as found in City of Glendale v. White,
67 Ariz. 231, 194 P. 26 435 (194t)),as follows:
"'What Is, and what is not, a public
purpose? It Is fundamental that taxes may
not be levied for private purposes. * * l
Hon. J. E. McDonald, page 15 (v-922)
"'"Public purpose" Is a phrase perhaps
incapable of definition, and better eluci-
dated by examples.
*****
"'In considering what Is properly a pub-
lic purpose, we should not be controlled to
too great an extent by decisions of courts
in climates far distant from ours. Further,
we should not be to too great an extent con-
trolled by decisions which come from a remote
time, and therefore may be out of tune with
modern conditions. The question of what is a
public purpose Is a changing question, chang-
ing to suit Industrial Inventions and devel-
opments and to meet new social conditions.
law is not a fixed and rigid system, but de-
velops, a living thing, as the Industrial and
social elements which form it make their im-
pelling growth.'"
There being no Texas authority precisely in
point, we deem it necessary to examine authorities in
those jurisdictions which have been oonfronted with
the levy of a tax for a purpose similar to that for the
Texas citrus Industry here Involved. Numerous other
States having various differing agricultural pursuits
for substantial parts of their economies have enacted
legislation regulating and fostering a particular agri-
cultural pursuit similar to the Texas Act we are here
considering Involving our citrus Industry.
In Floyd Fruit Company v. Florida Citrus Com-
y;;;;';~,128 Fla. 565, 175 So. 248, 112 A.L.R. 562
the Supreme Court of Florida sustained an act
of the legislature of that state levying a tax on each
standard-packed box of oranges, grapefruit or tangerines
grown in the state to be collected and used in advertls-
ing those fruits. The court held that such a tax is an
"excise tax" and not a property tax and did not violate
constitutional rules of equality, uniformity or due pro-
cess, as provided In the Constitutions of Florida or of
the United States; that such an excise tax was not un-
reasonable, unjustly discriminatory, or arbitrary: that
the tax was levied on the privilege of turning said
fruits Into the channels of trade, and was a valid tax
Hon. J. E. McDonald, page 16 (V-922)
regardlesa of whether they were later to be shipped in
interstate or foreign commerce; and that the tax so lm-
posed vas for the purpose of advertising such citrus
fruits and vas for a public purpose and valid because
the promotion of the citrus Industry Ln Florida was a
matter of public concern.
In Sllgh v. Kirkwood, 237 U.S. 52 (1915), the
Suoreme Court of th6 United States took judicial notice
of-the fact that the raising of citrus f&Its Is one of
the greatest industries of the State of Florida, and held
that “It was competent for the legislature to find that
it was essential for the success of that industry that
its reputation be preserved In other states wherein
such fruits find their most extensive market.”
In Maxcg, Inc. v. Mayo, 103 Fla. 552, $5~5~0.
121 (1931), the Supreme Court of Florida said:
court takes judicial notice of the fact that the citrus
Industry of Florida Is one of its greatest assets. Its
promotion and protection is of the greatest value to
the state, and Its advancement redtunds greatly to the
general value of the commonwealth.
In State ex rel. Graham v. Enklnq, 59 Idaho
321. 82 P. 26 649 [X938), the Supreme Court of Idaho
had-under consideratlonVa statute of that state levy-
ing a tax of one cent on each loo-pound unit of apples,
prunes, potatoes and onions shipped within the state,
for the purpose of providing a fund for advertising
such fruits and vegetables. It was there held against
the several contentions of InvalIdIty that It vas a tax
on the privilege of turning such fruits and vegetables
Into the primary channels of trade and vas not a prop-
erty tax, and did not, therefore, violate constitution-
al rules of equality, uniformity or due process; that
the tax was not a burden on interstate commerce; that
the tax having been levied for the purpose of provld-
lng a fund for advertising such fruits and vegetables
was valid and for a public purpose In that the protec-
tion and promotion of the apple, prune, potato, and
onion Industries was as much a matter of public con-
cern to Idaho as the citrus industry was to Florida,
citing Floyd Fruit Company v. Florida Citrus Commls-
*, supra .
In Miller v. Michigan State Apple Commission,
296 Mich. 248, 296 N.W. 245 (1941), the Supreme Court
Hon. J. E. McDonald, page 17 (V-922)
of Michigan had before it a statute of that state known
as the "Baldwin Apple Act," which levied 'an assessment
of 1 cent per bushel, or 2 cents per 100 pounds of all
apples grown and produced in Michigan, payable by the
grower or grower's agent when shipped," and providing
that "all moneys levied and collected under this Act
shall be expended exclusively to advertise apples."
The Act was sustained as a valid and constitutional ex-
ercise of the legislative power, as not being discriml-
natory, not a tax on property but on the privilege of
putting apples In the marts of trade, and as being a
tax for a public purpose.
In Louisiana State Deoartment of Agriculture
v. Sibllle, 207 La. 877, 22 So. 2d 202 (1945) the Supreme
Court of Louisiana was concerned with an act hf the lea-
lslature of that state creating the Louisiana Sweet PO-
tato Advertising Agency, imposing a tax to be collected
by the Louisiana State Department of Agriculture and
Immigration, on all sweet potatoes shipped in Louisiana.
The Agency was charged with the duty of planning and
conducting an advertising campaign for sweet potatoes
out of the funds realized from such tax. The act was
attacked under the Louisiana Constitution as not being
levied for a public purpose. It was there held that the
tax was 'for a 'public purpose' since it redounds to the
public welfare by Rromoting growth of an important agrl-
cultural Industry.
Because of the slmilarlty of the regulations
and of the constitutional consideration, we feel con-
strained to set out an extensive portion of the language
used ln the case, as follows:
"According to the evidence In the record,
sweet potatoes, from the standpoint of acreage
and value of production, constitutes the
fourth largest, and one of the major, commer-
cial crops of Louisiana, ranking only after
sugar cane, rice and cotton. Corn Is except-
ed from that classification since most of It
is used on the farms where produced In feeding
hogs. cattle and other animals. It Is true
that on the basis of percentage of acreage
planted the sweet potato crop falls consldera-
bly behind the other three major commercial
crops; nevertheless it is of great Importance
in the agricultural economy of this state as
Hon. J. E. McDonald, page 18 (V-922)
is attested by the fact that during a ten-year
period It had an average annual planting of
104,000 acres with an average annual yield of
7,185,000 bushels. Furthermore, in this con-
nection, consideration is to be given to the
agricultural trend in the southern section of
our nation which is to favor diversified farm-
ing, thereby avoiding a concentration on one
crop and preventing serious loss to the farmer
In particular and the entire tltlzenry gener-
ally when the one crop falls.
With particular respect to the purpose of the
act devoted to advertising sweet potatoes, the court
noted:
“The proceeds of the sweet potato tax
are not to be paid to the growers of that com-
modity or to any other Individuals or groups
that deal with it commercially; they are de-
voted exclusively to advertising the sweet pota-
toes, thus promoting the growth of an Important
and major Industry. By that advertising, es-
pecially in states where very little is known
of the value and usefulness of the sweet potato,
there will result an increased consumption. This,
In turn, will compel larger production and more
sales throughout this state, as a consequence of
which a greater prosperity will be realized not
only by those directly Interested but also by
our entire citizenry. Therefore, since It re-
dounds to the ptbllc welfare, the tax Is for a
public purpose.
The foregoing cited cases are indicative of the
present judicial trend to uphold the type of tax imposed
by the Texas Act In question as against constitutional
objectlogs, particularly as to Its being for a “public
purpose. The authorities are not without conflict, and
we set out hereafter two comparatively recent cases to
the contrary.
In Stuttgart Rice Mill v. Crandall, 203 Ark.
281, 157 S.W.2d 205 (1941), the Supreme Court of Ar-
kansas considered an act passed in that State called
the “Rice .DevelopmentCommission Law,” which levied a
tax on rice milled within the state for the purpose of
financing an advertising campaign to promote rice con-
sumptlon. That act was passed contingent upon the
. .
Hon. J. E. McDonaid, page 19 (V-922)
adoption of similar acts In Texas and Louisiana, which
were in fact adopted in those states, the Texas Act be-
ing Acts 47th Leg., 1941, ch. 434, p. 695. It was held
In the Instant case that the Arkansas "Rice Development
commlsslon Law" was unconstitutional under the Arkan-
sas Constitution as not being for a public purpose. The
basis of that holding is found In the following language:
"Broad use may be made of the state's
police power; and If the treatment of rice by
grower, miller, seller, or others dealing
with it creates a hazard against which there
should be protection, then,admlttedly, any
agency through which It passes may be subject-
ed to regulation and a tax laid for the reason-
able cost. But like corn, wheat, and all ag-
ricultural commodities of common use, rice Is
extremely wholesome. It contains no quality
or element requiring that strict supervision
which must be applied to products inherently
harmful.
"The latest federal census of agriculture
for Arkansas lists 1,428 rice farms, embracing
153,095 acres. The total of all farms in the
state Is 216,671, the acreage being 6,609,833.
In point of numbers, rice farms account for
.0066$ of the total, and in acreage .O23$.
"Can it be said that the Interests of so
small a group (although such farmers are among
the more aggressive, progesslve, and substan-
tial of the state) are such as to call for
protective Intervention by the state's taxing
powers on the theory that the common welfare
is Involved? That which is termed the logic
of this contention Is shredded by the facts."
In Llnaamfelter v. Brown, W. Va.
52 S.E.2d 687 (1949), the Supreme Court of West Virginia
held unconstitutional an act of the legislature of that
state creating the West Virginia State Apple Commission
and levying a tax on commercial apples grown In West
Virginia and "moved into the channels of commerce' to
conduct advertising campaigns to foster the apple lndus-
try, such tax being held not to be for a public purpose.
That court cited the Florida Citrus Commission Case, the
Michigan Apple Commission Case, the Idaho fruit and veg-
etable case, and the Louisiana Sweet Potato Commission
. .
Hon. J. E. McDonald, page 20 (V-922)
Case, but distinguished the West Virginia situation from
those cases, as follows:
“We are not persuaded that the reasoning
of the cases of C. V. Floyd Fruit Co. v.
Florida Citrus Commission,.supra; Michigan
Sugar Co. v. Dlx. supra; State v. Enklng, su-
pra, and Louisiana State D&partment of Agrl-
culture v. Slbille, supra should be applied in
this case. The principal reason for this con-
clusion Is that the growing and moving of com-
mercial apples in the State of West Virginia Is
not an enterprise or undertaking of such size
as to Impress It with a public interest. True,
the growing of apples and the shipping of them
Into ‘channels of commerce’ Is an important
undertaking to the persons engaged in that bus-
iness. Furthermore, it may be said that the
undertaking or enterprise Is Important to the
parts of the State where a considerable por-
tion of the land Is devoted to the growing of
apples. But when appraised from the stand-
point of the entire State the monetary returns
from such business are, more or less, insigni-
ficant and are not sufficient to characterize
that business as one of the principal commer-
cial or agricultural enterprises of the State
of West Virginia.”
The obvious conclusion is that the determining
factor in the case of an agricultural Industry Is the
relative contribution to the agricultural economy of the
taxing state made by the taxed agricultural industry.
The latest Texas Almanac, being that for the
years 1947-1948, reveals pertinent facts concerning the
Texas citrus lndustry. Texas grapefruit production of
24,000,OOO boxes In 1945 placed It second only to Flori-
da In such production. Average annual production from
1934 to 1943 has been over 12 000,000 boxes. Value of
the 1946 grapefruit crop was 821,675,000, nearly half
of all fruit and nut crops In the State. Texas ranked
seventh In 1946 among the thirteen orange-producing
states, the crop of that pear being 5,500,OOO boxes val-
ued at $9,625,000. Through June, 1946, 36,513 carlots
of citrus moved out of the Lower Rio Grande Valle
Texas Extension Service estimated that late In 19r6 there
The
vere 10,000,000 citrus trees in the Lower Rio Grand8
Valley. In the last ten years, utilization of citrus
fruit has Increased 350 per cent due primarily to process-
ing of citrus. Boxes of graperrult processed for juice
Increased from 20,000 In 1929 to 10,559,OOO In 1945. Ac-
cording to Information released by the United States De-
partment of Agriculture, the value of citrus production
in Texas in 1945 was $41.664.OOO. while the total value
Hon. J. E. McDonald, page 21 (V-922)
of all field crops, fruits, nuts and truck crops produc-
ed In the State that year amounted to $745,290,000, which
would make the citrus production 5.59$ of the total crop
production indicated. In 1947, the latest year for which
conclusive figures as to production are available, clt-
rus production totalled $18,041,000 as compared with the
total value of all field crops, fruits, nuts, and truck
crops amounting to $1,452,300,000, Indicating a percentage
of 1.24% allocable to citrus production.
It is pertinent also to recall the davastatlng
winter freeze In the early part of 1949 which ravaged
the citrus trees so tragically, rendering the industry
peculiarly In need of assistance to foster Its return
to Its previously held position in the agricultural econ-
omy of this State.
A further consideration is found In the fact
that the legislative purpose in enacting the Texas citrus
Commission Act, the statute we have here In question, Is
found In Section 20 of the Act, which reads:
"Sec.20. This Act Is passed for the pur-
pose of preventing economic waste of food and
loss of property and natural resources of this
State and to encourage and foster the develop-
ment of a major Industry, the Texas citrus ln-
dustry by fostering research as to new uses;
by preventing destruction thereof by pests and
diseases and by Improving the quality of and
stimulating demand for, such Texas citrus fruit
and by-products produced therefrom. Lack of
such fostering care for such industry has in
the past and will in the future (unless prevent-
ed) result in unnecessary and avoidable waste
of an Important resource of this State. Such
loss and waste will Imperil the ability of pro-
ducers of Texas citrus fruit to contribute in
appropriate amounts to the support of ordinary
governmental and educational functions, and in-
crease the tax burdens of other citizens for
the same purpose. Hence this Act Is passed to
further the public welfare an9 general pros-
perity of the State of Texas.
Pert~inentto the effect to be given the state-
ment of the legislative purpose expressed In the Act,
with reference to whether the tax be for a public pur-
., .
Hon. J. E. McDonald, page 22 (V-922)
pose, we cite the following from Louisiana State Deuart-
ment of Agriculture v. Slbille, supra:
"In enacting the statute In question the
Legislature, In Section 1 thereof, declared
that 'the production of sweet potatoes Is one
of the important agricultural industries of
the State of Louisiana; that this act Is pass-
ed to conserve and promote the prosperity and
welfare of the State of Louisiana and of the
sweet potato industry of the state and for
fostering and promoting better methods of
merchandising and advertising the sweet po-
tatoes produced In this state. The purpose
of this act Is to expand the market and in-
crease consumption of sweet potatoes by ac-
quainting the general public with the health
giving qualities and the food value of the
sweet potatoes grown In the State of Lo*lslana,
thereby promoting the general welfare of our
people."
"The declaration that the act was passed
to promote the prosperity and welfare of the
State of Louisiana and of its people is an ex-
pressed legislative recognition that the tax
is Imposed for a public benefit. To be sure
that recomltion is not conclusive: It could
not make the tax one for public purpose if in
fact It were folra private purpose. Since,
however, the members of the Legislature are
the direct representatives of all of the
p ple of the State, their declaration cer-
&ly furnishes the presumption that the pub-
lic generally Is to be benefited by the leve."
Upon a careful consideration of all of the author-
ities and of the circumstances surrounding the citrus In-
dustry In Texas, we are of the opinion that the collection
of the tax Imposed for the purposes therein enumerated in
Acts of 51st Legislature, 1949, ch.93,p.150, creating the
Texas Citrus Colmnisslon,would not be violative of Article
VIII, Section 3, of the Texas Constitution requiring that
taxes be levied and collected for public purposes only.
It is necessary to note In this connection that
in a previous opinion No. O-3364, dated April 17, 1941
It,was held bx this office that a roposed "Citrus Ad-
vertising Iav , Introduced In the t7th Legislature, was
unconstitutional as not being for a public purpose wlth-
Hon. J. E. McDonald, page 23 (V-922)
In the requirement of the Texas Constitution, citing
previous opinion No. 0-3106 which held a proposed Rice
Development Commission Bill, of the same Legislature,
to be unconstitutional for the same reason. The rice
opinion, No. 0-3106, is distinguishable In that it
was for another agricultural Industry and also In that
Its legislative purpose was not stated in the bill as
being for the general welfare of the people of the
State. The Citrus Advertising Commission opinion, No.
O-3364, is overruled In so far as the same conflicts
with the holding of this opinion on the Issue of the
tax being levied and collected for a public purpose.
(2) Does the delegation of authority to the
Texas Citrus Commission In connection with determining
the amount of the tax constitute an unconstitutional de-
legation of legislative authority violative of Article
fl, Section 1, and Article=, Section 48, of the Tex-
as Constitution?
We set out the pertinent provisions of the
Texas Constitution on this consideration, as follows:
Article II, Section 1, provides:
"The powers of the Government of the
State of Texas shall be divided into three
distinct departments, each of which shall
be confided to a separate body of maglstry,
to-wit: Those which are Legislative to one;
those which are Executive to another, and
those which are Judicial to another; and no
person or collection of persons, being of
one of these departments, shall exercise
any power properly attached to either of
the others, except In the Instances herein
expressly permitted."
Article III, Section 48, provides:
"The Legislature shall not have the
right to levy taxes or impose burdens upon
the people, except to raise revenue suffl-
cient for the economical administration of
the government. . . .'
We do not think that the delegation to the
Texas Citrus Commission of the pover to fix the tax In
question in an amount "not to exceed three cents (3#)
.I .
Hon. J. E. McDonald, page 24 (V-922)
per standard packed box or bag”, constitutes an uncon-
stitutional delegation of the power to tax. The lev
of the tax is made by the Legislature, not the comm
--? s-
sion, while the fixing of the amount - - not to exceed
three cents - - Is a ministerial function properly
delegable to an admlnistrktive agency.
Thus It is said In 1 Cooley on Taxation (4th
ed. 1924) 195:
“After a tax Is once levied or lmpoaed,
I.e., ordered to be laid, further proceedings,
such as the extending, assessing and collect-
ing the taxes, are administrative.”
And in Stratton v. Commissioners Court of
~;;w;)n;yn;-
“The general rule of constitutional law
thata sovereign power conferred by the people
upon one branch of the government cannot be
delegated applies with peculiar force to the
case of taxation. The taxing power is vested
by the Constitution In the Legislature; end
within that department of government lies the
authority
- to
_.prescribe
._ the rules
_.of
_ taxation,
._
anb to regulate tae manner 1n wnicn mose
rules shall be given effect. The Legislature
must in every Instance presmibe the rules
under which taxation may be laid. It must
originate the authority under which, after
due proceedlngs,‘the tax collector demands
the contribution; but It need not prescribe
all the details of action, nor even fix with
precision the sum to be raised or all the
particulars of Its expenditures.”
To the same effect on another t e of tax, see
Perry v. City of Rockdale, 62 Tex. 451 (lb). And see
an annotation in 70 A.L.R. 1232.
We therefore hold that the delegation of au-
thority to the Texas Citrus Coamlsslon In connection vlth
determining the amount of the tax Is not unconstltutlorul
as a delegation of the legislative power to lev taxes.
We refrain from passing upon the nature of the
tax as concerning Its distribution and also as concern-
ing Its collection fiat the grower. Those questions
Hon. J. E. McDonald, page 25 (V-922)
have not been asked and are not covered by this opinion.
SUMMARY
The tax levied under Acts 51st Leg.,R.S.,
1949, ch. 93, p. 150, codified as Article
1186, V.C.S., for the establishment and op-
eration of the Texas Citrus Commission, Is
not in violation of Article VIII, Section
3, of the Constitution of Texas which re-
quires that taxes be levied and collected
only for public purposes. Floyd Fruit Com-
pa y v. Florida Citrus Commission, 128 Fla.
56;, 17 So. 248 (1937); State ex rel Graham
59 Idaho 321, t12P.2d 649 (1938r;
ii=?=
11 er v. Michl
296 Mich., 248
ana State Depa&ment of Agriculture v. Sl-
bille, 207 la. 877, 22 So. 2d 202 (1945).
The tax is not In violation of Article
II, Section 1, or of Article III, Section
48, of the Constitution of Texas, as en ln-
valid delegation of the taxing authority to
an administrative agency. Penny v. City of
Rockdale, 62 Tex. 451 (1884');Stratton v.
Commissioners Court of Kinney County 1
s.w (T Ci 9 1 erroi rZ.);
1 Coo:ii'on %at& "&
( % ,'d!i924) 195.
Yours very truly,
ATTORNEY GENERAL OF TEXAS
DJC:bh: gl
This opinion has been
considered and approved
In limited conference.
ATTORNEY GENERAL