Texas Attorney General Opinion: WW-431 Page: 3 of 9
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Hon. Frank R. Nye, Jr., page 3, Opinion No. WW-431
to the lease operator as his lease share and was taxed
the same as oil produced.
"Sun, in rendering their properties in Starr County
for ad valorem taxes, have omitted the 'plant opera-
tor's portion', (which in 1956 amounted to approx-
imately $2,165,120), described above, maintaining
that it is not subject to any property tax, including
ad valorem taxes. They argue that the 'plant opera-
tor's portion' is a mere processing charge.
"The Commissioners' Court of Starr County and the
Board of Trustees of the San Isidro Independent
School District of Starr County feel that said 'plant
operator's portion' is subject to the ad valorem
taxes to be levied by the State and County and said
School District for the year 1958; and it is the in-
tention of said officials to make such levy (apply-
ing the same ratio of assessment as is applied to
all other real property owned and rendered by Sun)
if said 'plant operator's portion' is property within
the meaning of the law subject to ad valorem taxes.
"Said officials have also indicated that it is their
intention, if it can be legally done, to retroactively
assess such 'plant operator's portion' for the years
the same has been omitted from the Sun Oil Company's
renditions subsequent to the construction of its gas
processing plant.
"In analyzing these facts it appears to this office
that two questions arise:
(a). Is said 'plant operator's portion', as des-
cribed above, real property subject to ad
valorem taxes?
(b). If the answer to (a) is in the affirmative then:
Is said 'plant operator's portion' subject to
retroactive assessment for any years it may
have been omitted by Sun from its rendition of
property for ad valorem taxation?"
The Sun Oil Company is designated in this opinion as
"plant operator." The lessees (whether owing an 1/8 royalty
or 7/8 working interest) will be designated the "producer."
The question we must answer is whether or not under con-
tracts between Sun Oil Company, the plant operator, and
various owners of gas leases, the portion which you have
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Texas. Attorney-General's Office. Texas Attorney General Opinion: WW-431, text, May 21, 1958; (https://texashistory.unt.edu/ark:/67531/metapth267043/m1/3/: accessed July 16, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.