Untitled Texas Attorney General Opinion

KEN PAXTON
ATTORNEY GENERAL OF TEXAS
May 11, 2017
The Honorable Rodney W. Anderson Opinion No. KP-0147
Brazos County Attorney
300 East 26th Street, Suite. 1300 Re: Scope of residence homestead tax
Bryan, Texas 77803 exemption in Tax Code subsection l l.13(l)(2)(B)
(RQ-0140-KP)
Dear Mr. Anderson:
You ask for guidance on the proper construction of Tax Code subsection l 1.13(/)(2)(B). 1
Section 11.13 generally implements the Texas constitutional provision that grants taxpayers
residence homestead exemptions from ad valorem property taxes. TEX. TAX CODE § 11.13; see
also TEX. CONST. art. VIII, § 1-b (providing for residential homestead exemptions). Subsection
11.13G)(1) defines a "residence homestead" as
a structure (including a mobile home) or separately secured and
occupied portion of a structure ... that:
(A) is owned. by one or more individuals, either directly or
through a beneficial interest in a qualifying trust;
(B) is designed or adapted for human residence;
(C) is used as a residence; and
(D) is occupied as the individual's principal residence by an
owner, by an owner's surviving spouse who has a life estate
in the property, or ... by a trustor or beneficiary of the trust
who qualifies for the exemption.
TEX. TAX CODE § 1 l.13(j)(l ). A structure can retain its status as a residence homestead when the
owner "temporarily stops occupying it as a principal residence," but only under certain
circumstances. Id. § 11.13(!). Relevant to your question, subsection 11.13(l)(2)(B) provides:
A qualified structure does not lose its character as a residence
homestead when the owner who qualifies for the exemption
'See Letter from Honorable Rodney W. Anderson, Brazos Cty. Att'y, to Honorable Ken Paxton, Tex. Att'y
Gen. at 1 (Nov. 3, 2016), https://www.texasattomeygeneral.gov/opinion/requests-for-opinion-rqs ("Request Letter").
The Honorable Rodney W. Anderson - Page 2 (KP-0147)
temporarily stops occupying it as a principal residence if that owner
does not establish a different principal residence a,nd the absence is
... caused by the owner's ... residency in a facility that provides
services related to health, infirmity, or aging.
Id § 11.13(l)(2)(B) (emphasis added). 2 You note the absence of any statutory definition or
appellate court interpretation of the phrase "facility that provides services related to health,
infirmity, or aging." Request Letter at 2. You suggest that it would be reasonable to assume that
assisted living and skilled care facilities would fall within the scope of subsection 1 l .13(l)(2)(B),
noting that such facilities would "provide services related to health, infirmity, or aging" to
residents who move there because their "safety and welfare require" it. Id at 3. However, you
tell us that
there are new types of "independent living" facilities which vary
greatly in services and amenities. Many people move to these types
of facilities primarily because of convenience. [They] are still fully
capable of living in their own homes, but do not require assistance
with activities of daily living, such as feeding, dressing, moving,
bathing, or other personal needs or maintenance. These independent
living facilities do not usually provide any of those types of services,
and do not provide direct health care or administration of
medication. Instead, they generally offer a safe and maintenance-
free place to live, and in many cases provide exercise rooms and
services, cafeterias, housekeeping services, and transportation to
shopping areas, physician's offices, etc.
It is also not uncommon for a person to move into a 'continuing
care' facility, which ... offers three different living options -- (1)
independent living, (2) assisted living, and (3) skilled care.
Id You ask this office to opine on "the proper factors that should be used to determine whether
any type of residence is a 'facility that provides services related to health, infirmity, or aging'" as
that phrase is used in subsection 11.13(l)(2)(B). 3 Id at 4.
When construing a statute, a court's primary objective is to determine and give effect t6
the Legislature's intent. BCCA Appeal Grp., Inc. v. City ofHouston, 496 S.W.3d 1, 8 (Tex. 2016).
Courts discern that intent from the words of the statute. Tex. Student Hous. Auth. v. Brazos Cty.
Appraisal Dist., 460 S.W.3d 137, 141 (Tex. 2015) ("[W]hen construing any statute,
including tax exemptions, the truest manifestation of what lawmakers intended is what they
enacted."). Courts give an undefined statutory term its "ordinary meaning unless 'a different or
2
Section 11.13(/) was amended in 2003. See Act of May 28, 2003, 78th Leg., R.S., ch. 240, § 1, 2003 Tex.
Gen. Laws 1100, 1100.
3
You do not ask about, and we do not opine on, any of the other requirements in subsection 11.13(/)(2)(8)
that must be fulfilled in order for a person's home to maintain its character as a residence homestead under that
subsection.
The Honorable Rodney W. Anderson - Page 3 (KP-0147)
more precise definition is apparent from the term's use in the context of the statute.'" R.R. Comm 'n
of Tex. v. Gulf Energy Exp!. Corp., 482 S.W.3d 559, 568 (Tex. 2016) (quoting TGS-NOPEC
Geophysical Co. v. Combs, 340 S.W.3d 432, 439 (Tex. 2011)). Courts also determine "legislative
intent from the statute as a whole, not from isolated portions." Philadelphia Indem. Ins. Co. v.
White, 490 S.W.3d 468, 484 (Tex. 2016).
With these principles in mind, we tum to the phrase in subsection 1 l.13(/)(2)(B) you ask
about, which provides that a temporary absence must be "caused by the owner's ... residency in
a facility that provides services related to health, infirmity, or aging." TEX. TAX CODE
§ 1 l.13(/)(2)(B). Because the Legislature did not define the word "facility" for purposes of this
provision, we look to its common meaning. A "facility" is an "establishment set up to fulfill a
particular function or provide a particular service, typically an industrial or medical one." NEW
OXFORD AMERICAN DICTIONARY 619 (3d. ed. 2010). Similarly, the Legislature did not define
"services" for purposes of subsection 1 l.13(/)(2)(B). A "service" is "an act of assistance." Id. at
1596; see also Kirby Lake Dev., Ltd. v. Clear Lake City Water Auth., 320 S.W.3d 829, 839 (Tex.
2010) (noting that the term "services" is "broad enough to encompass a wide array of activities").
The statute does not require that an owner living in such a facility must receive the specified
services, referring only to an owner's temporary "residency" in the type of establishment that
makes the specified services available. See Sw. Bell Tel., L.P. v. Emmett, 459 S.W.3d 578, 584
(Tex. 2015) (statutory construction obliges courts to "take statutes as [they] find them,
understanding that the Legislature purposefully selected the words chosen"). In addition, although
the Legislature specified that the services must relate to health, infirmity~ or aging, it did not define
these terms for purposes of subsection 1l.13(l)(2)(B). TEX. TAX CODE§ 1 l.13(/)(2)(B). Again,
we look to the common meaning of these terms. "Health" is "the state of being free from illness
or injury; a person's mental or physical condition." NEW OXFORD AMERICAN DICTIONARY 801
(3d. ed. 2010). "Infirmity" is "physical or mental weakness." Id. at 890. "Aging" is "the process
of growing old." Id. at 31. Thus a court would likely construe subsection 1 l.13(/)(2)(B) to refer
to an owner's temporary residence in an establishment set up to assist persons with overcoming
illness or injury, or with needs related to physical or mental weakness or growing old, through a
wide range of activities, regardless of whether the owner receives such services. The relatively
recent advent of the facilities you describe may well be grounds for the Legislature to revisit the
framework it created. However, it does not warrant a court rewriting the words the Legislature
has chosen.
The Honorable Rodney W. Anderson - Page 4 (KP-0147)
SUMMARY
A court would likely construe subsection 1 l.13(/)(2)(B) of
the Tax Code to refer to an owner's temporary residence in an
establishment set up to assist persons with overcoming illness or
injury, or with needs related to physical or mental weakness or
growing old, through a wide range of activities, regardless of
whether the owner receives such services.
Very truly yours,
``~
KEN PAXTON
Attorney General of Texas
JEFFREY C. MATEER
First Assistant Attorney General
BRANTLEY STARR
Deputy First Assistant Attorney General
VIRGINIA K. HOELSCHER
Chair, Opinion Committee
BECKYP. CASARES
Assistant Attorney General, Opinion Committee