Texas Attorney General Opinion: GA-0665 Page: 3 of 9
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The Honorable Susan Combs - Page 3
A "qualified investment" referenced in section 313.021(2)(A)(iv) is also a defined term that
overlaps to some extent with the definition of"qualified property." Compare id. 313.021(1) with
id. 313.021(2)(B)-(C). In general, a "qualified investment" is an investment in (1) tangible
personal property that is used in connection with the manufacturing, processing, or fabrication in a
cleanroom environment of a semiconductor product, the operation of a nuclear power generation
facility, or the operation of an integrated gasification combined cycle electric generation facility; or
(2) a building or a permanent, nonremovable building component that houses authorized tangible
personal property. See id. 313.021(1). The land on which a building or building component is
located is not a qualified investment. Id. 313.024(c)(1); see also id. 313.024(c)(2)-(3) (providing
that property leased under a capitalized lease may be considered a qualified investment, but not
property leased under an operating lease).
B. Proposed Comptroller rule and question presented
Your request is prompted by an objection to a rule proposed by your office setting forth who
may be an "owner of the land" under section 313.021(2)(A). See Request Letter, supra note 1, at
1-2. An application to a school district for a limit on the appraised value is forwarded to
the Comptroller of Public Accounts (the "Comptroller"). See TEX. TAX CODE ANN. 313.025(b),
(d) (Vernon 2008). The Comptroller is required to recommend to the school district whether
the application should be approved or disapproved. Id. 313.025(d). The Comptroller's
recommendation must be based on the economic impact criteria set out in the statute and, after
December 31, 2007, "on any other information available to the comptroller." Id. 313.026(b).
Section 313.031 requires the Comptroller to "adopt rules and forms necessary" to implement and
administer chapter 313. Id. 313.031(a); see also Request Letter, supra note 1, at 1.
Recently, the Comptroller repealed the agency rules adopted when chapter 313 first became
effective in 2002, and proposed and adopted new rules. See Request Letter, supra note 1, at 1. One
of the newly-proposed rules provided "that a person with an ownership interest in land, including
[a] leasehold interest that is coextensive with the limitation agreement, is an 'owner' for purposes
of 313.021(2)." Id. (emphasis added); see also 32 Tex. Reg. 8106 (2007) (setting out proposed
rule) (proposed Nov. 9, 2007). This provision was included, you explain, "because we recognized
that many school districts had approved applications submitted under Chapter 313 by entities that
leased land on which the qualified property would be placed, and we believed that there was no
disagreement about the construction of the statute." Request Letter, supra note 1, at 1. During the
statutory thirty-day comment period for the proposed rules, a public comment was submitted
objecting and arguing that an "owner of"' land does not include a lessee of land. See id.2 (Because
of the objection, the proposed rule was not adopted. Id. at 2; see also 33 Tex. Reg. 274 (2008)).
Thus, although you frame your question in terms of an "applicant who has a leasehold interest in
qualifiedproperty," we understand your concern to be with whether an applicant who has a leasehold
2See also Brief from F. Scott McCown, Executive Director, Center for Public Policy Priorities, to Honorable
Greg Abbott, Attorney General of Texas, at 3 (Apr. 8, 2008) (on file with the Opinion Committee) [hereinafter CPPP
Brief] (objecting to the construction of "owner of land" proposed by the Comptroller of Public Account's rule).(GA-0665)
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Texas. Attorney-General's Office. Texas Attorney General Opinion: GA-0665, text, September 16, 2008; (https://texashistory.unt.edu/ark:/67531/metapth275561/m1/3/: accessed April 24, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.