The Honorable Joseph
C.
Pickett - Page 5
(KP-0004)
participation by political subdivisions in the city's tax increment financing plan). Thus, the
language
of
article VIII, section 1-g(b) grants authority to cities that it does not grant to counties.
We received briefing in connection to your request letter that argues article VIII, section
1-g(b) makes no express mention
of
tax increment financing. See Brief from
C.
Brian Cassidy,
Locke Lord, L.L.P. at 4
(Sept.
19,
2014) (on file with the Op. Comm.). The argument is that just
as cities have beeh utilizing tax increment financing based only on statutory authorization without
benefit
of
a constitutional amendment,
so
too may counties utilize such financing based on
statutory authority.
3
See
id.
at
4.
Although article VIII, section 1-g(b) does not use the term "tax
increment financing," the circumstances
of
its adoption support a construction
of
the section as a
grant
of
authority for tax increment financing limited to only municipalities. The Legislature
proposed article VIII, section 1-g(b) in response to the issuance
of
Attorney General Opinion MW-
337 (1981), which concluded that a 1979 law authorizing municipalities to engage in tax increment
financing violated the Texas Constitution's equal and uniform taxation provision.
4
Tex. Att'y
Gen.
Op. No. MW-337 (1981) at
11.
Contemporaneous with the election, a publication for voters
analyzing proposed
SJR 8 described the tax increment financing mechanism in cities and indicated
that its purpose was to provide constitutional support to the mechanism at issue in MW-337.
5
A
similar publication reiterated the fact that
SJR 8 was proposed in direct response to Opinion MW-
3 3 7 and stated that the legislation implementing article VIII, section 1-g(b)
"authorize[
d]
a city or
town to designate an area within its jurisdiction as a reinvestment zone, redevelop property in the
zone, and finance the redevelopment by bonds or notes payable solely from tax increments from
the reinvestment
zone."
6
These publications indicate that the proposed amendment was
understood by the voters to provide a constitutional basis
to
support a municipality's use
of
tax
increment financing to develop or redevelop certain municipal areas.
The Legislature that framed the proposed amendment evidenced a similar intent. In the
same legislative session in which it adopted
SJR
8,
the Legislature enacted enabling legislation for
the proposed amendment, which specifically authorized municipalities to create reinvestment
zones, issue tax increment bonds or notes, and deposit tax increments into the tax increment fund.
See Act
of
Aug. 10, 1981, 67th Leg., 1st C.S., ch. 4, ยง
9,
1981
Tex. Gen. Laws 45, 49.
It
contained
no similar authority for counties.
See
id.
The enabling legislation is a statement, contemporaneous
3
We disagree with this argument. While statutes may grant counties the authority to create a tax increment
reinvestment zone and use the increased tax revenue for county zone projects as authorized by statute, we have
previously concluded those statutes
likely violate the constitution. See supra at
3-4.
Statutes authorizing municipal
use
of
tax increment zones are not unconstitutional under the equal and uniform requirement
in
article VIII, section
I (a) only because article VIII, section 1-g(b) serves as an exception to that requirement. See Tex. Att'y Gen. Op. Nos.
GA-0276 (2004) at 5 (characterizing section 1-g(b) as
an
exception to the equal and uniform requirement), JC-0152
(1999) at 5 (same), JC-0141 (1999) at 3 (same).
4
See Tex. S.J. Res.
8,
67th Leg., 1st C.S., I
981
Tex. Gen. Laws 295 ("SJR 8"); see also House Study Group,
Special Legislative Report, Constitutional Amendment Analysis, Analysis
of
SJR
8,
at 2 (Sept. 9, I
98
I); Tex.
Legislative Council, Analysis
of
Proposed Constitutional Amendments Appearing
on
November
3,
198 I, Ballot,
Information Report No. 81-3 at 4
(Sept.
1981
).
5
House Study Group, Special Legislative Report, Constitutional Amendment Analysis, Analysis
of
SJR 8 at
1-2
(Sept.
9,
1981).
6
Tex. Legislative Council, Analysis
of
Proposed Constitutional Amendments Appearing
on
November 3,
1981, Ballot, Information Report No. 81-3 at 4, 6
(Sept. 198 I).