How would an MTA rate election affect Helotes, could a city withdraw, and what would a city telecommunications-tax ordinance do?

Plain-English summary

The Comptroller said Helotes voters would vote on an MTA tax increase in the same election as voters elsewhere in the authority. If a majority across the MTA approved the increase, the result applied to every area within the MTA.

The authority's entire tax rate, including an increase, supported the related transit system. Rule 3.423(b) provided a method for a qualified city or town to withdraw from the MTA.

A city ordinance imposing 1% local tax on telecommunications would not change the city's overall tax rate. It would extend the existing 1% local tax to telecommunications alongside other locally taxed goods. The Comptroller enclosed Enrolled H.B. 2008 on MTA board responsibilities and withdrawal conditions.

What this means for you

The historical structure treated the authority as one voting area for a rate election. The city telecommunications ordinance changed the covered tax base, not the stated overall rate.

Common questions

Did Helotes vote separately from the rest of the MTA? No. Its voters participated in the MTA-wide election.

Did the majority result apply throughout the MTA? Yes.

What funded the transit system? The full MTA tax rate, including any approved increase.

Could a city withdraw? The letter says Rule 3.423(b) provided a method for a qualified city or town.

Would the telecommunications ordinance raise the overall rate? No. It would apply the 1% city tax to telecommunications.

Citations and references

• Comptroller Rule 3.423(b) — method for a qualified city or town to withdraw from an MTA.
• Enrolled H.B. 2008 — described as explaining MTA board responsibilities and withdrawal conditions.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8706L0828C11

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller June 23, 1987

Dear ***:

Thank you for your recent letter regarding questions you had about
Metropolitan Transit Authority taxes.

In answer to question 1: Yes, Helotes voters would be voting on the
question of raising the MTA taxes in the same election as the other
citizens of the other areas included in the MTA.

In answer to question 2: Yes, if the majority of the voters in the MTA
elect to raise the rate, then that election's results apply to all areas
within the MTA.

In answer to question 3: The entire tax rate of the Metropolitan Tax
Authority goes to support the related transit system, including any
increase in the tax rate elected.

In answer to question 4: Yes, there is a method by which a qualified
city or town can withdraw from a Metropolitan Transit Authority. See
Section (b) of the enclosed Rule 3.423.

In answer to question 5: If you pass an ordinance to collect 1% City
tax on telecommunications your over all tax rate does not change. This
ordinance would merely impose 1% local tax on telecommunications in
addition to the other goods that are already subject to local tax as it
now exits.

I am enclosing a copy of the Enrolled House Bill 2008, which explains
the responsibilities of the MTA board and the conditions for withdrawal
from the MTA.

This opinion is based on the facts presented. If there are additional
or different facts, the opinion may change.

If you have any questions or need more information, please call me at
1-800-252-5555 toll free from anywhere in Texas. The regular number is
512/463-4600. You may write me at the Tax Administration Division.

Sincerely,
F. Wayne McDonald
Tax Policy Section
Tax Administration Division