VIA Telecom Tax Exemption Repeal

1. CITY OF ALAMO HEIGHTS
ADMINISTRATION DEPARTMENT
CITY COUNCIL AGENDA MEMORANDUM
TO: Mayor and City Council
FROM: Buddy Kuhn, City Manager
SUBJECT: Consideration of an ordinance for repeal of the exemption of telecom taxes
imposed by a taxing entity within Alamo Heights for VIA Metropolitan
Transit Authority
DATE: April 29, 2024
SUMMARY
Section 322.109 of the Texas Tax Code, VIA Metropolitan Transit Authority is exempted
/ prohibited from imposing taxes on telecommunications services unless the application
of the exemption is repealed under that section. The repeal must be approved by the local
governing body of each municipality that created the taxing entity.
BACKGROUND INFORMATION
VIA approached the City of Alamo Heights along with numerous other suburban cities
within Bexar County to consider the repeal ordinance. Each suburban city that originally
assisted in the creation of VIA exempted VIA from imposing fees for telecommunication
services. If an ordinance is approved by a certain number of the original cities, then VIA
can petition the City of San Antonio and the State Comptroller’s office for approval and
begin imposing sales taxes on telecommunications providers. The repeal of this
exemption does not affect the ability of the City of Alamo Heights to continue imposing
sales taxes for telecommunication service companies.
POLICY ANALYSIS
Under section 322.109(d) of the Texas Tax Code, the governing board of a taxing entity
created under Chapter 451, Transportation Code (VIA)may not repeal the application of
the exemption of taxes on sales within its entity area of telecommunication services
unless the repeal is first approved by a majority of the members of a governing body.
COORDINATION
The City Attorney, Mayor and City Manager have met with representatives from VIA
and reviewed all information submitted. The City Attorney has approved the attached
ordinance under consideration.
FISCAL IMPACT
There is no fiscal impact to the city.
_________________________
Buddy Kuhn
City Manager

2. Attachment A
ORDINANCE NO. 2220
AN ORDINANCE OF THE CITY OF ALAMO HEIGHTS, TEXAS, REPEALING
THE APPLICATION OF THE EXEMPTION FROM LOCAL SALES AND USE
TAXES ON RECEIPTS FROM THE SALE OF TELECOMMUNICATION
SERVICES ON SALES WITHIN VIA METROPOLITAN TRANSIT
AUTHORITY’S ENTITY AREA OF TELECOMMUNICATIONS SERVICES AND
APPROVES VIA’S INTENT TO IMPOSE SUCH A TAX ON
TELECOMMUNICATION SERVICES, AS PROVIDED IN SECTION 322.109 OF
THE TEXAS TAX CODE; PROVIDING FOR NOTIFICATION TO THE
COMPTROLLER OF THE STATE OF TEXAS; PROVIDING FOR REPEALING,
SAVINGS AND SEVERABILITY CLAUSES; AND PROVIDING FOR AN
EFFECTIVE DATE
WHEREAS, under Section 322.109 of the Texas Tax Code there are exempted from the taxes imposed by
a taxing entity the sales within the entity area of telecommunications services unless the application of the
exemption is repealed under that section, and
WHEREAS, under Section 322.109(d) of the Texas Tax Code, the governing board of a taxing entity
created under Chapter 451, Transportation Code, may not repeal the application of the exemption of taxes
on sales within its entity area of telecommunications services unless the repeal is first approved by a
majority of the members of the governing body of each municipality that created the taxing entity; and
WHEREAS, VIA Metropolitan Transit (VIA) is a taxing entity created under Chapter 451, Transportation
Code; and
WHEREAS, the City Council of the City of Alamo Heights is a governing board of a municipality that
assisted in the establishing of VIA; and
WHEREAS, VIAdoes not currently impose a sales and use tax on telecommunications services sold within
its entity area; and
WHEREAS, the VIA Board of Trustees intends to repeal the application of the exemption of taxes on sales
within VIA’s entity area of telecommunications services and has requested the City Council of the City of
Alamo Heights approve VIA’s decision to do so as required under Section 322.109(d) of the Texas Tax
Code; and
WHEREAS, after thorough review and consideration, the City Council finds it approves VIA’s desire to
repeal the application of the exemption of taxes on sales within VIA’s entity area of telecommunications
services and approves VIA’s intent to impose such a tax on telecommunication services:
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ALAMO
HEIGHTS, THAT:
SECTION 1. The City Council of Alamo Heights hereby approves VIA’s decision to repeal the application
of the exemption of taxes on sales within VIA’s entity area of telecommunications services and approves
VIA’s decision to impose such a tax on telecommunications services.

3. Attachment A
SECTION 2. The City Manager, upon the request from VIA, shall forward to the Comptroller of the State
of Texas by certified or registered mail a copy of this Ordinance along with a copy of the minutes of the
City Council’s vote and discussion regarding this Ordinance.
SECTION 3. Upon this Ordinance becoming law pursuant to applicable City procedures, it shall be entered
into the minutes of the City Council.
SECTION 4. All provisions of any ordinance in conflict with this Ordinance are hereby repealed to the
extent they are in conflict; but such repeal shall not abate any pending prosecution for violation of the
repealed ordinance, nor shall the repeal prevent a prosecution from being commenced for any violation if
occurring prior to the repeal of the ordinance. Any remaining portions of said ordinances shall remain in
full force and effect. Further, the tax provided for hereunder shall not serve as an offset to, be in lieu of or
in any way reduce any amount payable to the City pursuant to any franchise, street use ordinance, charter
provision, statute, or without limitation by the foregoing enumeration, otherwise payable by any provider
of telecommunications service; it being the express intent hereof that all such obligations, impositions, and
agreements of every kind and nature shall remain in full force and effect without reduction or limitation
hereby.
SECTION 5. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held
to be unconstitutional or invalid by a court of competent jurisdiction, such decision shall not affect the
validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have
passed this Ordinance and each section, subsection, clause, or phrase thereof. Irrespective of the fact that
any one or more sections, subsections, sentences, clauses, and phrases be declared unconstitutional.
SECTION 6. This Ordinance shall take effect and be in full force from and after its passage
PRESENTED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF ALAMO
HEIGHTS, TEXAS THIS 29th
DAY OF APRIL, 2024.
BOBBY ROSENTHAL, MAYOR
ATTEST:
ELSA T. ROBLES, CITY SECRETARY
APPROVED AS TO FORM:
FRANK J. GARZA, CITY ATTORNEY