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1999 Texas Attorney General Reports and Opinions 1 (1999)

handle is hein.sag/sagtx0075 and id is 1 raw text is: O OFFICE OF THE ATTORNEY GENERAL * STATE OF TEXAS JOHN CORNYN February 24, 1999 The Honorable Michael P. Fleming Opinion No. JC-0001 Harris County Attorney 1019 Congress, 15th Floor Re: Whether a racetrack admission fee collected Houston, Texas 77002-1891 by a county to distribute to municipalities pursuant to the Texas Racing Act, see TEX. REV. Civ. STAT. ANN. art. 179e, § 6.17(a) (Vernon Supp. 1999), violates article VIII, section 1(f) of the Texas Constitution (RQ-10 16) Dear Mr. Fleming: You ask whether a fee set forth in article 179e, section 6.17(a) of the Revised Civil Statutes, a racetrack admission fee that a county is authorized to collect to distribute to municipalities in the county, runs afoul of the limitations on county and municipal occupation taxes set forth in article VIII, section 1(f) of the Texas Constitution, which precludes counties and cities from levying occupation taxes unless the state has done so. A tax is an occupation tax if its primary purpose is to raise revenues in excess of the amount needed for regulation of the industry. Conlen Grain & Mercantile, Inc. v. Texas Grain Sorghum Producers Bd., 519 S.W.2d 620, 623-24 (Tex. 1975). Because a municipality has no authority to regulate a racetrack located outside its jurisdiction, we conclude as a matter of law that the admission fee at issue is an occupation tax. We are unable to determine whether the admission fee violates article VIII, section 1(f), however, because we cannot resolve whether the state has imposed an occupation tax on racetracks. Article 179e, the Texas Racing Act (the Act), generally delegates the authority to regulate racing in this state to the Texas Racing Commission (the Racing Commission). See generally TEX. REV. Civ. STAT. ANN. art. 179e, §§ 3.02 - .22 (Vernon Supp. 1999). The Racing Commission regulates racetrack licensing and is expressly authorized to set application fees, id. § 6.03(e), license fees, id. § 5.01(b), and annual fees, id. § 6.18(b). In addition, the Act requires the Comptroller to collect a portion of each pari-mutuel pool' on behalf of the state and grants the Comptroller rule- making authority with respect to those duties. Id. §§ 4.01 - .06 (Comptroller's authority), 6.09, .091, .093 (setting forth state's entitlement to portion of pari-mutuel pools). IPari-mutuel pool means the total amount of money wagered by patrons on the result of a particular race or combination of races, the total being divided into separate mutuel pools for win, place, show, or combinations. TEX. REv. Civ. STAT. ANN. art. 179e, § 1.03(19) (Vernon Supp. 1999).

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