9801149H


HEARING NO. 34,872

IN RE:**************

TAXPAYER NO.:**************
AUDIT OFFICE:**************
AUDIT PERIOD:  05/01/92 THROUGH  10/31/94

SALES AND USE TAX/RDT

BEFORE THE COMPTROLLER
OF PUBLIC ACCOUNTS
OF THE STATE OF TEXAS

PETER BROOKS
Administrative Law Judge

JOHN CODY PERKINS
Representing Tax Division

**************
Representing Petitioner



COMPTROLLER'S DECISION

PROCEDURAL HISTORY AND PRELIMINARY COMMENTS:

This case was decided on the written submissions of the parties. Notice has 
been taken of all Comptroller's records pertinent to this case.  Section 
references, unless otherwise noted, are to Title 2 of the Texas Tax Code, and 
Rule references are to Title 34, Texas Administrative Code.

On June 3, 1996, Petitioner filed Exceptions to the Proposed Comptroller's 
Decision issued on May 24, 1996.  On June 6, 1996, the Tax Division filed its 
Response to Petitioner's Exceptions.  The Administrative Law Judge has 
considered Petitioner's Exceptions and the Tax Division's Response, and this 
Amended Proposed Comptroller's Decision represents the ruling thereon.

PETITIONER'S CONTENTIONS:

1.	"Petitioner contends that all of the amounts scheduled in Exam 4 should 
be deleted from the audit.  This exam primarily reflects amounts paid by 
Petitioner to totalisator companies for the purchase of wagering services. .... 
The two totalisator companies charge Petitioner the amounts scheduled in Exam 4 
for the right to offer Petitioner's wagerers in attendance at its ******** 
racetrack to be included within the various wager pools for the out-of-state 
races.  Simply stated, by paying the out-of-state totalisator companies.  
Petitioner acquires the ability to offer betting on out-of-state races to its 
customers....  Consequently, Petitioner concludes that the totalisator 
companies are using a computer to facilitate the performance of a non-taxable 
wagering service that it is purchasing from them."

2.	"Alternatively, if it were concluded that Petitioner was purchasing a 
taxable data processing service from the two totalisator companies, its 
purchases would, nevertheless, be exempt for resale.  The sale of admission to 
a licensed racetrack for the purpose of wagering is considered the sale of an 
amusement service that is subject to sale tax. ...  Consequently, even if the 
wagering services performed by the totalisator companies were considered the 
performance of taxable data processing service, its purchase would be exempt 
because it is being purchased for the purpose of being resold as an integral 
part of a taxable amusement service."

3.	Petitioner alternatively argues that the purchase of the totalisator 
services is exempt for resale because it is also being resold as an integral 
part of all simulcast cable television services sold by the sending racetrack 
to the receiving racetrack.

4.	Petitioner's payments of $************** and $************** (for a 
total of $**************) to COMPANY A, scheduled on Exam 4, were the purchase 
price of simulcast signals sold to Petitioner by COMPANY A.

FINDINGS OF FACT:

1.	Petitioner operates a horse racing track in **************, Texas.  
Petitioner offers its customers the opportunity to engage in pair-mutuel 
wagering.

2.	The Comptroller audited Petitioner for sales and use tax compliance for 
the audit period May 1, 1992 through October 31, 1994.  As a result of the 
audit, the Comptroller issued a Texas Notice of Tax Due dated March 13, 1995, 
in the amount of $**************, consisting of tax, penalty and interest 
calculated through the date of Notice.

3.	Exam 4 primarily reflects amounts paid by Petitioner to totalisator 
companies (COMPANY B - and COMPANY C ) for the purchase of totalisator 
services.  COMPANY B and COMPANY C  are out-of-state companies whose primary 
customers are out-of-state racetracks.  The actual horse races occur at the 
out-of-state racetracks.  The two totalisator companies charge Petitioner the 
amounts scheduled in Exam 4 for the right to offer Petitioner's wagerers in 
attendance at its ************** racetrack to be included within the various 
wager pools for the out-of-state races.

4.	"Pari-mutuel wagering" is a form of wagering on the outcome of a horse 
race in which all wagers for each race are divided into separate pools for win, 
place, show, or other combinations for distribution of the total wagers, less 
authorized deductions, to holders of tickets on the winning animals.  The 
totalisator system records and keeps track of who is entitled to what at the 
end of the race.

5.	Petitioner's sales of tickets for admission to its racetracks are sales 
of taxable amusement services.  Admission to Petitioner's racetracks entitles a 
person to watch either live or simulcast horse or greyhound races and to engage 
in pari-mutuel wagering on the outcome of those races.

6.	A racetrack cannot offer pari-mutuel wagering without the use of a 
totalisator system according to the Texas Racing Act; therefore, tickets for 
admission to a pari-mutuel racetrack in Texas cannot be sold unless the 
racetrack owner utilizes totalisator services of the type sold by Petitioner.  
Tex. Rev. Civ. Stat. Ann. art. 179e, Section 11.02.

7.	Tickets for admission to a non-pari-mutuel racetrack can be sold, and 
no totalisator services would be required.

8.	In November 1994, the Comptroller's office informed all Texas racetrack 
owners that simulcasting services may be purchased from a sending racetrack 
under a resale certificate, so long as a fee is charged for admission to the 
receiving racetrack, because the simulcasting services are being resold as part 
of a taxable amusement service.

9.	A sending racetrack is required by the Texas Racing Commission "to 
present a simulcast which offers the viewers an exemplary depiction of the 
performance, a periodic display of wagering information, and continuity of 
programming between racing events.  "16 TAC Section 321.207(b).  The Texas 
Racing Act requires that such wagering information cannot be displayed by the 
sending racetrack without the use of totalisator services of the type purchased 
by Petitioner.  Tex. Rev. Civ. Stat. Ann. art. 179e, Section 11.02.

10.	Pari-mutuel wagering is subject to tax and regulation by the Texas 
Racing Commission.

11.	Purchasers of admission tickets are not required to wager on races.  
Admission tickets are sold to persons wishing to watch a race who have no 
desire to place a wager.

12.	Petitioner submitted into evidence one of its checks.  No. 1195, dated 
March 11, 1994, in the amount of $************** payable to COMPANY A.  The 
check explanation attached thereto breaks the payment into items.  Two of the 
items are for $************** and $**************.  Petitioner claims that 
these two items are for COMPANY A's signal as indicated by the letter "s" that 
precedes the date for each of the two items on the check explanation.

13.	Petitioner submitted into evidence an affidavit executed by PERSON A, 
Petitioner's Chief Financial Officer. PERSON A in the affidavit avers that the 
"s" that precedes both the $************** and $************** amounts reflects 
that there two amounts represent signal expense accrued  by Petitioner for 
recovering a simulcast charge from COMPANY A.

14.	The sending track of a simulcast cable television service uses the 
totalisator service for its own use at its racetrack as well as a part of the 
simulcast service.

15.	An ordinary horse race or greyhound race is different from a 
pari-mutuel horse race or greyhound race.  In an ordinary race, there are no 
amounts being wagered, there are no ever-changing odds and pay-off amounts 
being posted on the scoreboard, there is no temptation to wager on the outcome 
of the races based on those odds, and the excitement or fantasy generated by 
the possibility of winning  money on the outcome of pari-mutuel races is not 
present.

16.	The scoreboards for pari-mutuel races are the display boards or odds 
boards that show the amounts wagered in each separate betting pool, updated 
every sixty seconds up to the time betting stops, the odds on each racing 
animal, the order of finish, the pay-off amounts for each, and other relevant 
race information.  16 TAC Section 309.423.  These scoreboards are a necessary 
element of a pari-mutuel horse or greyhound race to the same extent that 
scoreboards in football stadiums and basketball coliseums are necessary 
elements of football and basketball games.  In fact, the pari-mutuel race 
scoreboards are more necessary because their presence is legally required.  16 
TAC Sections 301.1, 309.423, and 321.1(b).  The totalisator services of the 
type sold by Claimant are essential to the operation of a pari-mutuel race 
scoreboard and are, therefore, an essential part of the pari-mutuel race 
itself.

17.	The pari-mutuel scoreboards described in Finding of Fact No. 16 enable 
spectators to mentally wager on the outcome of the races without actually 
purchasing any betting tickets, and this is a form of entertainment that can be 
indulged in by pari-mutuel racing spectators.

CONCLUSIONS OF LAW:

Petitioner's Contention No. 1 should be denied.

GOVERNING AUTHORITY:

Section 151.0101 defines taxable services to include "data processing 
services."  Section 151.0035 then provides a definition for the term, as 
follows:

"Data Processing Service" includes word processing, data entry, data retrieval, 
data search, information compilation, payroll and business accounting data 
production, and other computerized data and information storage or 
manipulation.  "Data processing service" also includes the use of a computer or 
computer time for data processing whether the processing is performed by the 
provider of the computer or computer time or by the purchaser or other 
beneficiary of the service.

In addition, Comptroller's Rule 3.330(a) provides a further clarifying 
definition of data processing services.  Rule 3.330(a) provides as follows:

(a)	Services.  Data processing services means the processing of information 
for the purpose of compiling and producing records of transactions, maintaining 
information, and entering and retrieving information.  It specifically includes 
word processing, payroll and business accounting, and computerized data and 
information storage or manipulation.  The charge for data processing services 
is taxable regardless of the ownership of the computer.  Examples of data 
processing services would include the entry of all inventory control data for a 
company, maintenance of records of employee work time, filing payroll tax 
returns, preparing W-2 forms, and computing and preparing payroll checks.  Data 
processing does not include the use of a computer by a provider of other 
services when the computer is used to facilitate the performance of the service 
or the application of the knowledge of the physical sciences, accounting 
principles, and tax laws, e.g., the use of a computer to provide interpretive 
or enhancement geophysical services or the use of a computer by a C.P.A. firm, 
enrolled agent, or bookkeeping firm to produce a financial report, prepare 
federal income tax, state franchise or sales tax returns, or charges for 
temporary secretarial personnel who as part of their function use word 
processing equipment.

Comptroller's Rule 3.342 provides in relevant part the following with regard to 
what information services are taxable:

(2)	Information services - Furnishing general or specialized news or other 
current information, including financial information, by printed, mimeographed, 
electronic, or electrical transmission, or by utilizing wires, cable, radio 
waves, microwaves, satellites, fiber optics, or any other method now in 
existence or which may be devised, and electronic data retrieval or research.

(b)	Taxable information services.  Information which is gathered, 
maintained, or compiled and made available by the provider of the information 
service to the public or to a specific segment of industry for a consideration 
is subject to sales tax.  Except as provided in subsection (d)(3) of this 
section, the total charge for information services whether by subscription or 
on an as-needed basis is taxable.  Examples of such information services  
include, but are not limited to, the following:

(1)	newsletters;

(2)	scouting reports and surveys, including those used in sports and the 
oil and gas and related industries;

(3)	mailing lists, and bad check lists (only that percentage which 
represents names of persons located in Texas is taxable);

(4)	real estate listings; 

(5)	financial, investment, stock market, or bond rating, or financial 
reports, other than charges to a person by a financial institution for account 
balance information; 

(6)	news clipping services and wire services; and 

(7)	abstracts of title and other information provided by title plants.

(c)	Exempt information services.  Sales tax is not due on information 
services sold to a newspaper or to a radio or television station licensed by 
the Federal Communications Commission, if an exemption certificate is obtained. 
 The exemption certificate must state that the purchaser is a newspaper with a 
general circulation published at least as frequently as weekly, or is a station 
licensed by the Federal Communications Commission.

(d)	Nontaxable information.

(1)	The sale of information which is gathered or compiled on behalf of a 
particular client is not subject to tax if the information is of a proprietary 
nature to that client and may not be sold to others by the person who gathered 
or compiled the information.  Any subsequent sale of such information by the 
client for whom the information was gathered or compiled is subject to tax.  
Examples include opinion polls and management consultant reports.

(2)	Any sale of information primarily derived from laboratory, medical, or 
exploratory testing or experimentation or any similar method of direct 
scientific observation of physical phenomena is not subject to tax.  Examples 
of information the sale of which is exempt from tax under this subsection 
include, but are not limited to, geophysical survey information, polygraph 
test, and medical test results.

(3)	Information required to be furnished pursuant to the Open Records Act 
is not subject to sales tax.  See sec. 3.341 of this title (relating to Sales 
of Governmental Publications, Records, or Documents).  Fees paid when obtaining 
these documents may be excluded from the tax base if separately stated when the 
documents are furnished to clients.  Tax will only be due on the amount over 
and above the cost of the documents.

PETITIONER'S ARGUMENTS:

Petitioner seeks to distinguish the totalisator services it purchases from 
those found taxable in Comptroller's Decision No. 29,110 (1992).  Although 
Petitioner recognizes that a totalisator service similar to that at issue here 
was deemed a taxable data processing service in Decision No. 29,110.  
Petitioner demurs that it lacks precedential value.  Petitioner argues that the 
Decision did not address the contention that the totalisator service cannot be 
considered a data processing service because, the wagering information is 
developed from scratch.  Petitioner asserts that this is a crucial distinction 
because in order to perform a data processing service, the information 
processed must be given to the service provider.

Petitioner argues that the service should be considered an information service 
rather than a data processing service because as argued in its Reply to the Tax 
Division's Position Letter, the provider of the totalisator service is 
gathering and compiling information in the form of how many bets of what 
amounts have been made on each animal of each race, the unique number that 
identifies each winning ticket of each race, and the amount owed thereon.  This 
information, however, is being gathered for particular clients, namely, the 
racetrack owners and their state regulators, and the information is of a 
proprietary nature that must be preserved under tight security measures and 
cannot be sold to others.  See 16 TAC Sections 309.401, 309.404-.433, and 
321.3-321.7.  Petitioner contends that as a proprietary wagering information 
service, it is not a taxable service. 

In its Statement of Grounds, Petitioner argued that the totalisator companies 
are not entering, retrieving, maintaining, processing, reformatting, or 
manipulating data provided to them; instead they are developing wagering 
information from scratch because they are responsible for the initial capture 
and subsequent tracking of all wagers, the calculation of odds and pay-off 
amounts, and the validity of all tickets presented for payment.  See 16 TAC 
Sections 309 and 321; cf. 34 TAC section 3.330(a).  Consequently, Petitioner 
concluded that the totalisator companies are using a computer to facilitate the 
performance of a non-taxable wagering service that it is purchasing from them.

TAX DIVISION'S ARGUMENTS:

The Tax Division's position is fairly straightforward.  The Tax Division 
rejects the Petitioner's argument that the totalisator service is actually a 
nontaxable, proprietary information service rather than a data processing 
service.  The Tax Division counters by noting that the wagering information is 
not developed from scratch as it contends.  The racetrack employees enter the 
wagering information into the totalisator companies' computerized system, which 
then manipulates the data to compute odds, payoffs, and reports.  The Tax 
Division concludes that this is clearly within the definition of data 
processing and the ruling of Decision No. 29,110.

CONCLUSIONS AND DISCUSSION:

Petitioner, however, draws a distinction between Decision No. 29,110 and the 
case before us.  It claims that the taxpayer in Decision No. 29,110 did not 
make the argument that the information was developed from scratch.

Petitioner's argument is not borne out by the facts.  Petitioner has not 
established that it is the totalisator companies' employees and not the 
racetrack's employees who enter the information regarding each separate wager.  
Only after the information has thus been entered is the totalisator used to 
calculate the odds, and transmit the information to the racetracks.

A review of the Comptroller's holding in Decision No. 29,110 affirms the Tax 
Division's position that the Decision is controlling in this case: 

In consideration of the functions performed by ATCI through the operation of 
its AmTote 400 Series Totalisator System (see Finding of Fact No. 5), it is not 
difficult for the ALJ to conclude that, at least, a very significant portion of 
the services provided by the System constitute "data processing services" as 
that term is defined by both the statute and the Comptroller's interpretive 
rule.  As the Tax Division stated in both its Position Letter and final 
Response, 'COMPANY B processes the information regarding the wagers, calculates 
the odds and pay-offs, enters, maintains and retrieves that information, and 
produces records of each wager transaction.'  Such functions are at the very 
heart of what 'data processing services' are defined by the law to mean and, 
thus, intended by the Legislature to be taxed.

This very same argument raised by Petitioner was also raised by the taxpayer in 
Proposed Comptroller's Decision No. 34,660 (1996).  The argument that 
totalisator services are nontaxable proprietary information services rather 
than a data processing service was rejected.  The Taxpayer's attempts to 
distinguish Decision No. 29,110 on the grounds that the Decision had not 
addressed the claim that the service involved the development of information 
from scratch.  The distinction was dismissed in Proposed Comptroller's Decision 
No. 34,660.

Thus, I conclude that Decision No. 29,110 is controlling.  It should be noted 
that this very same argument was raised by the taxpayer in Hearing No. 34,660 
and rejected in the Proposed Comptroller's Decision issued in that hearing.

Petitioner's Contention No. 2 should be denied.
GOVERNING AUTHORITY:

Comptroller's Rule 3.337, in relevant part, allows for service providers to 
issue resale certificates under the following circumstances: 

(c)	Resale certificates.

(1)	Providers of data processing services may issue a resale certificate in 
lieu of tax to suppliers of tangible personal property only if care, custody, 
and control of the property is transferred to the client.  For example, a 
service provider purchases magnetic tape to transfer the results of data 
processing services to customers.  The tape is transferred to the customer, and 
the customer owns and uses the tape to review the results of the data 
processing service.  The service provider may purchase the tape tax free by 
issuing a resale certificate.  Tax is due on the total amount charged the 
customer, including amounts for the tape and for the services.  

(2)	A resale certificate may be issued for a service if the buyer intends 
to transfer the service as an integral part of taxable services.  A service 
will be considered an integral part of a taxable service if the service 
purchased is essential to the performance of the taxable service and without 
which the taxable service could not be rendered.

(3)	A resale certificate may be issued for a taxable service if the buyer 
intends to incorporate the service into tangible personal property which will 
be resold.  If the entire service is not incorporated into the tangible 
personal property, it will be presumed the service is subject to tax and the 
service will only be exempt to the extent the buyer can establish the portion 
of the service actually incorporated into the tangible personal property.  If 
the buyer does not intend to incorporate the entire service into the tangible 
personal property, no resale certificate may be issued, but credit may be 
claimed at the time of sale of the tangible personal property to the extent the 
service was actually incorporated into the tangible personal property.

PETITIONER'S ARGUMENTS:

Petitioner contends that the use of the totalisator services is essential to 
the operation of a pari-mutuel racetrack because these services are required by 
state law.  Section 11.02 of the Texas Racing Act provides that wagering may be 
calculated only by state-of-the-art computational equipment that is approved by 
the Texas Racing Commission.  According to rules promulgated by the Texas 
Racing Commission, racetracks must use a totalisator system in order to conduct 
pari-mutuel wagering.

Petitioner argues that it should be clear that a Texas racetrack cannot sell 
admission tickets for pari-mutuel wagering unless the racetrack utilizes 
totalisator services of the type purchased by Petitioner.  Consequently, 
Petitioner reasons that the totalisator services at issue in this case must be 
considered sold for the purpose of being resold as an integral part of a 
taxable amusement service.

TAX DIVISION'S ARGUMENTS:

The Tax Division in rather succinct terms rejects Petitioner's arguments.  It 
is the Tax Division's position that the amusement service subject to sales tax 
is the admission to the racetrack to watch the races.  Tickets are sold to 
persons wishing to watch a race who have no desire to place a wager.  The 
pari-mutuel wagering is subject to regulation and tax by the Racing Commission, 
and is separate and apart from the taxable admission charge.  Thus, the Tax 
Division concludes that while the totalisator service may be integral to the 
wagering operation it is not integral or essential to the amusement service, 
i.e., racing.  Accordingly, its purchase by Petitioner was subject to sales 
tax. 

CONCLUSIONS AND DISCUSSION:

Although it is clear that the pari-mutuel racetracks could not offer 
pari-mutuel racing without the totalisator services, this does not mean that 
the services are an integral part of a taxable service.  The totalisator 
services are an integral part of the pari-mutuel wagering but they are not an 
integral part of the admission fee to the racetrack.  The admission fee 
entitles a person to enter the grounds and watch the races.  In order to wager 
a person must then enter into a separate transaction, which is not subject to 
taxation by the Comptroller.  This conclusion was also reached in Proposed 
Comptroller's Decision No. 34,660. 

Petitioner's Contention No. 3 should be denied.

GOVERNING AUTHORITY:

Comptroller's Rule 3.298(f)(2) provides in relevant part the 
following:

(f)  Taxable item sold or transferred with amusement service.

(1)	Sellers of service may issue a resale certificate in lieu of tax to 
suppliers of tangible personal property only if care, custody, and control of 
the property is transferred to the client.  For example, a taxpayer purchases 
padlocks to transfer to customers when lockers are rented.  The padlock is 
transferred to customers, and the customers use the padlock when renting the 
locker.  Taxpayer may purchase the padlock tax free by issuing a resale 
certificate.  Tax is due on the total amount charged the customer, including 
amounts for the padlock and for the services.

(2)	A resale certificate may be issued for a service if the buyer intends 
to transfer the service as an integral part of taxable services.  A service 
will be considered an integral part of a taxable service if the service 
purchased is essential to the performance of the taxable service and without 
which the taxable service could not be rendered.

(3)	A resale certificate may be issued for a taxable service if the buyer 
intends to incorporate the service into tangible personal property which will 
be resold.  If the entire service is not incorporated into the tangible 
personal property, it will be presumed the service is subject to tax and the 
service will only be exempt to the extent the buyer can establish the portion 
of the service actually incorporated into the tangible personal property.  If 
the buyer does not intend to incorporate the entire service into the tangible 
personal property, no resale certificate may be issued, but credit may be 
claimed at the time of sale of the tangible personal property to the extent the 
service was actually incorporated into the tangible personal property.

(4)	Any item, such as machinery or equipment, purchased to be used in the 
providing of an amusement service is not an item transferred with an amusement 
service and is subject to sales tax.

PETITIONER'S ARGUMENTS:

Petitioner argues that wagering information, i.e., the odds, payoff amounts, 
etc., is legally required to accompany the simulcast cable television service 
sold by a sending racetrack to a receiving racetrack as a component thereof.  
See Finding of Fact No. 9.  A sending racetrack must purchase totalisator 
services in order to provide this component of the taxable simulcast cable 
television service sold by it to a receiving racetrack because wagering 
information is the end product of totalisator services.  Id.  Consequently, all 
of Petitioner's sales of totalisator services to sending racetracks are exempt 
for resale by them as a component part of the taxable simulcast cable 
television service sold by them.  Rule 3.298(f)(2).  This would exempt the 
great majority of Petitioner's sales at issue in this case because it would 
cover all sales to the pari-mutuel racetracks that conduct live pari-mutuel 
races and who sell a simulcast image of those races, which is virtually all of 
Petitioner's customers.

TAX DIVISION'S ARGUMENTS:

The Tax Division's response is very straightforward and is best summarized in 
the following except:

The fallacy with Petitioner's theory is that the sender of the simulcast uses 
the totalisator service for its own use at the racetrack before it is sent as 
part of the simulcast.  Petitioner has provided no evidence to show the portion 
of the totalisator service used by its customers that send simulcasts solely 
for their own use and the portion used as solely as part of the simulcast.  
Accordingly, the entire charge is subject to tax.


CONCLUSIONS AND DISCUSSION:

Petitioner's argument is artfully drafted and argued.  However, I must agree 
with the Tax Division, in so far as Petitioner overlooks a critical fact:  the 
totalisator service is first used by the customer to provide pari-mutuel 
wagering.  As I concluded earlier with respect to Contention No. 2:

"The totalisator services are an integral part of the pari-mutuel wagering but 
they are not an integral part of the admission fee to the racetrack.  The 
advertising submitted into evidence as Exhibit P-1 advertises a $1 general 
admission fee which is what the Comptroller taxes as an amusement service.  
This fee entitles a person to enter the grounds and watch the races.  In order 
to wager a person must then enter into a separate transaction, which is not 
subject to taxation by the Comptroller." 

Petitioner may try again and again but it cannot avoid the reality that the 
totalisator service is not an integral part of the amusement service.  
Consequently, it cannot prevail under Rule 3.298(f)(2).

Petitioner's Contention No. 4 should be granted.

Petitioner argues that a total of $************** scheduled in Exam 4 actually 
represents payments made to COMPANY A for the simulcast signal from COMPANY A.  
Petitioner has offered as proof the check to COMPANY A and the affidavit of 
PERSON A.  See Finding of Facts Nos. 12 and 13.  The Tax Division has not 
rebutted Petitioner's factual representations and agrees that the referenced 
items should be deleted.

RECOMMENDATION:

The audit liability should be affirmed in its entirety, except for the payments 
made to COMPANY A.  In addition, given the time it has taken to issue this 
Amended Proposed Comptroller's Decision, interest is waived from June 19, 1996 
through the date of issuance of this Decision.

Signed this 14th day of January, 1998.



PETER BROOKS
Administrative Law Judge

HEARING NO.: 34,872

ORDER OF THE COMPTROLLER


The above decision of the Administrative Law Judge, resulting in Taxpayer's 
liability as set out in Attachment "A" which is incorporated by reference, is 
approved and adopted in all respects.  This decision becomes final twenty (20) 
days from the date of this Order, and the total sum of the tax, penalty and 
interest amounts is due and payable within twenty (20) days thereafter.  If 
such sum is not paid within such time, an additional penalty of ten percent of 
the taxes due will accrue, and interest will continue to accrue.

If a rehearing is desired, a Motion for Rehearing must be filed with the clerk 
of the Administrative Law Judges twenty (20) days from the date of this Order, 
and must state the grounds upon which the motion is based.

SIGNED this the 14th day of January, 1998.


JOHN SHARP
Comptroller of Public Accounts
of the State of Texas



ACCESSION NUMBER: 9801149H
SUPERSEDED: N 
DOCUMENT TYPE: H
DATE: 01/14/1998
TAX TYPE: SALES