Friday, November 4, 2011

Some Local Boards of Realtors' Property May Be Exempt in Texas

As reported in State Tax Today (subscription required), the Texas Attorney General has recently issued an opinion responding to a question from a Texas State Senator of whether local boards of realtors qualify for the property tax exemption for "nonprofit community business organizations" set forth in section 11.231 of the Texas Tax Code.  While noting that the Office of the Attorney General “does not determine questions of fact, and we therefore cannot ultimately determine whether a tax exemption applies” to any specific property, the opinion nonetheless concludes that an entity that is engaged primarily in performing one of the economic development functions listed in the statute constitutes a "nonprofit community business organization" that qualifies for the property tax exemption.  In reaching this conclusion, the opinion contains an interesting discussion of the effect of the legislative intent of the statutory exemption:

You indicate that your intent was to provide an exemption for local chambers of commerce. See Request Letter at 1. Although that statement may manifest your intent, the Texas Supreme Court has ruled that the statement of a single legislator does not determine legislative intent. See AT&T Commc'ns of Tex., L.P. v. Sw. Bell Tel. Co., 186 S.W.3d 517, 528-29 (Tex. 2006). The Texas Supreme Court has further stated that "[w]here [the] text is clear, text is determinative of [legislative] intent." Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433, 437 (Tex. 2009). Accordingly, we are required to rely on the plain text of the statute, which grants the exemption not to a "chamber of commerce" but to a "nonprofit community business organization." Tex. Tax Code Ann. § 11.231(a) (West Supp. 2010). There is no indication in the text of section 11.231 that the exemption was meant exclusively for a chamber of commerce.

Remember, readers, to whom the Texas Attorney General is writing when he remarks that "the statement of a single legislator does not determine legislative intent."  United States Supreme Court Justice Scalia has little on Texas Attorney General Greg Abbott in this regard!

JRB

http://lawprofessors.typepad.com/nonprofit/2011/11/some-local-boards-of-realtors-property-may-be-exempt-in-texas.html

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