Untitled Texas Attorney General Opinion ( 1972 )

Honorable J. W. Edgar OpiniOn NO. M-1072 State Commissioner of Education 201 East Eleventh Street Re: Legality of adoption Austin, Texas 78701 by Independent School District of Home Rule City's ordinance pro- viding a 10% penalty on Dear Mr. Edgar: delinquent taxes. Your request for an official opinion is quoted as follows: "Pursuant to the provisions of Article 1066b, Vernon's Civil Statutes, as amended, taxes of the Wichita Falls Independent School District are assessed and collected by the City of Wich- ita Falls. "By Ordinance No. 2680 (passed November 2, 1971), the City of Wichita Falls has increased penalty charged by it for delinquent taxes from 8% to 10%. "The Wichita Falls Independent School District board desires to adopt the ordinance allowing collection by or for said school district of a 10% delinquent tax penalty, if not prohibited by the limit in Article 7336, V.C.S., or any other statute.~ "The Board of Trustees of the Wichita Falls Inde- pendent School District has by resolution requested me to submit for consideration and opinion of the Office of Attorney General re the following: "The legali~byof increasing penalty on delinquent school tares of the Wichita Falls district from 8% .to IO%--whose taxes are collected pursuant to authority exercised under Article 1066b, V.C.S., as amended." -5253- Honorable J. W. Edgar, page 2, (M-1072) Undoubtedly, the crux of the problem posed by your question is whether Section lb of Article 1066b, which gives a city as- sessing and collecting taxes for another district or m-i- pality, the option to collect such taxes in installments as al- lowed by Article 7336, or in lump sums with an 8% delinquency penalty limit, is a limitation on the powers granted in Sec- tion la of such Article. This latter Section grants to any municipality or district taking advantage of the act in -s- tion (Art. 1066b) the r1gh.tto adopt 3 law of the State or charter provision or ordinance applicable to the levying, as- sessing and collecting of taxes by the district of municipal- ity rendering the tax service. It is apparent that Sections la and lb of Article 1066b serve dual functions within the framework of the Act, i.e., to achieve uniform and economical collection procedures. Sec. la allows the participating municipalities or districts to adopt by ordinance or resolution any applicable law of the State, and, as well, any ordinance or charter provision of each other which are applicable to the levying, assessing and collecting of taxes, In order that such tax services may be performed in a uniform and economical manner. Sec. lb, on the other hand, applies on1 to the agency performing the tax services for another,-3 an then only when such active agency is a city. This section is plainly a grant of extra power to cities par- ticipating under the terms of Articm66b who performthese tax services for other cities or districts. The authority here given to such cities is the unilateral option to collect such taxes for them- and the other partming munici- palities and districts according to the general tax collec- tion laws prescribed by Article 7255 and 7336 (which permit installment paymen,ts)or by the exclusive lump sum payment plan prescribed as an alternative by Sec. lb of Article 1066b. Obviously, this extra power given the City chosen to serve as assessor, collector and Board of Equalization in tax mat- ters for the other participants, further serves the stated purpose of uniformity and eco'nomyas expressed in Section la of Article 1066b. However, ,thisoption on the part of such participating cities is merely permissive and they are not (All Articles and Sections thereof herein referred to are Vernon's Civ:ilSatutes.) -5254- Honorable J. W. Edgar, page 3, (M-1072) obliged to exercise such right. Neither are the alternative tax procedures of Sec. lb of Article 1066b exclusive of other procedures allowed by law to be chosen by the participating members. Thus, the City of Wichita Falls, being governed under a Home Rule Charter, can serve as a tax agent for the Wichita Falls Independent School District while using its own charter provisions and ordinances relating to the assessing and col- lecting of taxes. Furthermore, by authority given by Sec. la of Article 1066b the Wichita Falls Independent School District can adopt the City's said Charter provisions and ordinances relating to the assessing and collecting of taxes. It appears from the material furnished with your request that the Charter under which the City of Wichita Falls is oper- ating allows a penalty of not more than 10% on the City's de- linquent ad valorem taxes. While an Independent School District has no power of its own to set penalties or interest on its delinquent taxes, it may adopt all provisions of state and coun- ty laws on taxation that nay be applicable (Art. 7337); and if, as is desired in this instance, it takes advantage of the pro- visions of Article 1066b, it may by ordinance or resolution adopt all or any part of the Charter or ordinances applicable to the levying, assessing and collecting of taxes, of the City rendering the tax service. (Sec. la, Art. 1066b). Hence, it is the opinion of this office that the Wichita Falls Independent School District, whose taxes are assessed and collected by the City of Wichita Falls pursuant to author- ity exercised under Article 1066b, may adopt the City's Ordi- nance allowing the collection of a 10% penalty on delinquent taxes, thus equalizing the legal penalty on delinquent taxes of the City and the school district at 10%. SUMMARY by Wichita Falls Independent The adoQil'``or! School District o:?the Home Rule City of Wichita -5255- Honorable J. W. Edgar, page 4, (M-1072) Falls! tax ordinance, will authorize the City to collect its and the school district's delin- quent taxes at a penalty rate of ten (10%) per cent. Prepared by R. L. Lattimore Assistant Attorney General APPROVED: OPINION COMMITTEE Kerns Taylor, Chairman W. E. Allen, Co-Chairman James Broadhurst Harriet Burke James McCoy Malcolm Quick SAMUEL D. MCDANIEL Staff Legal Assistant ALFRED WALKER Executive Assistant NOLA WHITE First Assistant -5256-