THE ATTORNEY GENERAL 

OF TEXAS 

March 19, 1990 

Honorable Wilhelmina Delco Opinion NO. JM-1146 

Chairman 

Higher Education Committee Re: Authority of a univerTexas House of Representatives sity to allocate space in a 

P. 0. Box 2910, Office 413-C campus building to be used 

Austin, Texas 78769-2910 exclusively by a private 

group of faculty members 

(RQ-1845) 

Dear Representative Delco: 

You ask whether Texas A & M University may allocate 

space in a campus building‘ to be used exclusively for an 

auxiliary enterprise of the university known as the Faculty 

Club (hereinafter the club). The primary question is 

0 whether such an arrangement is constitutional. This 

question was previously asked of this office, but the 

request was withdrawn prior to the issuance of an opinion. 

Attorney General Opinion Request RQ-1407 (1988). Since that 

original opinion request, the operation of the club has 

changed considerably with the university assuming more 

responsibility. 

We have separately received a brief from the university 

system explaining the operation of the club and its relationship with the university. The brief informs us that the 

club is now being operated as an auxiliary enterprise of 

Texas A 8 M University. The vice president for finance and 

administration of Texas A 8 M University administers the 

club, and university employees staff it. The brief further 

states that a nonprofit corporation provides bar services to 

the faculty club and uses the bar receipts to purchase bar 

supplies and to reimburse the university for its administration of the faculty club. The vice president directs the 

payment of expenses of the corporation. 

The club serves its members and their guests as well as 

visiting professors, former students, parents, friends and 

others. However, visitors (who we understand to be nonmembers) may not make reservations but are accommodated only 

as space permits. 

p. 6051 
Honorable Wilhelmina Delco - Page 2 (JM-1146) 

? 

With that understanding of the club, we must look at 

the controlling law. Governance of A L M University and the 

A 61 M University System is vested in the board of regents. 

Educ. Code 55 85.11, 86.02. Section 85.21 of the Education 

Code generally establishes the authority of the board as 

follows: 

The board shall make bylaws, rules, and 

regulations it deems necessary and proper for 

the government of the university system and 

its institutions, agencies, and services. 

The board shall regulate the course of study. 

and prescribe the course of discipline 

necessary to enforce the faithful discharge 

of the duties of the officers, faculty, and 

students. 

Those Education Code provisions generally vest the 

board of regents with the power to manage and control 

university property.. sfn w . Woo- 287 S.W. 677 

(Tex. Civ. App. - Austin 1926, io writ).' The board of 

regents has delegated its responsibility for the management 

and control of university property to the chief executive 

officer of each part of the system. Texas A & M University 

System, Administrative Policy and Reporting Manual g c-11.2 

(April 25, 1989). 

While we find no express authority for the university 

system to operate auxiliary enterprises, we believe that the 

university is authorized to operate such non-educational 

facilities. m Educ. Code 55 51.008(b), 61.003(14); 

Attorney General Opinions H-513 (1975); H-456 (1974); LA-6 

(1973). Furthermore, a faculty club fits within the parameters of "auxiliary enterprises" indicated by the examples 

listed in section 61.003(14), which reads as follows: 

'Educational and general buildings and 

facilities* means buildings and facilities 

essential to or commonly associated with 

teaching, research, or the preservation of 

knowledge, including the proportional share 

used for those activities in any building or 

facility used jointly with auxiliary enterprises. Excluded are auxiliary enterprise 

buildings and facilities, including but not 

limited to dormitories, cafeterias, student 

union buildings, stadiums, and alumni 

centers, used solely for those purposes. 

p. 6052 
Honorable Wilhelmina Delco - Page 3 (JM-1146) 

The faculty club under consideration here is very 

similar to the student food cooperative addressed ' 

Attorney General Opinion H-513. In that opinion, th:: 

office determined that a state university, with the approval 

of the governing board, was authorized either to house and 

supply a private food coop or to operate one as an auxiliary 

enterprise. Attorney General Opinion H-513 (1975). 

The governing board of the A 8 M University System 

apparently has not given direct approval for the operation 

of the faculty club. However, the board has indirectly 

approved the club in its adoption of the university budget, 

which includes a separate line item for the club. We 

believe that the regent's inclusion of club expenses in the 

university budget is tantamount to approval by the regents 

of the operation of the club. It is our further opinion 

that the regents may delegate responsibilities for administration of the club to university officers. The court in 

8ache Halsev Stuart Shields. Inc. v. Universitv of Houston, 

638 S.W.2d 920 ITex. ADD. - Houston rlst Dist.1 1982, writ 

ref'd n.r.e.) examined-kections of the Education Code- relative to the power of the board.of regents of the University 

of Houston. Those provisions were very similar to the 

sections cited above relative to the board of regents of the 

A & M University System. The court addressed the issue of 

whether the board of regents was authorized to delegate 

some of its duties to university officers and found that, 

inasmuch as the board of regents had a certain power, it 

also had the power to delegate "the details of management to 

a President and other officers." & at 926. The court 

noted: 

By enacting the above mentioned sections, the 

Legislature obviously contemplated that the 

Board could not run a large University without a great deal of aid from individuals 

intimately familiar with the details of the 

University on a day to day basis. The Board 

has been given the authority to delegate the 

actual running of the University and to 

select people qualified to do so, and has 

been authorized to retain power of approval, 

power to hire, and power to fire, should the 

employees not perform adequately. 

a at 927. 

p. 6053 
Honorable Wilhelmina Delco - Page 4 (JM-1146) 

For tbe above reasons, we believe that Texas A br M 

University is authorized to operate a faculty club as an 

auxiliary enterprise of the university. 

We understand that-your principle concern is that this 

allocation of university property might contravene article 

III, section 51, of the Texas Constitution, which provides 

in part as follows: 

The Legislature shall have no power to 

make any grant or authorize the making of any 

grant of public moneys to any individual, 

association of individuals, municipal or 

other corporations whatsoever. 

While the terms of that section appear to prohibit only 

grants of money, the provision has been construed to prohibit tbe grant of any public property without the receipt 

of.an adequate ouid nro -&lo. Q&son v; Warsu 118 S.W.2d 

621 (Tex. Civ. App. - Waco 1938, writ dism#dj; Attorney 

General Opinions JW-551 (1986); &lW-89 (1979); WW-790 (1960). 

We do not think that use of university funds, property, 

or staff for then club is necessarily prohibited by article 

III, section 51. If it is determined that the operation of 

the club furthers university purposes, for example by enhancing faculty relations or by helping to attract more 

qualified faculty members, and that such uuid nro ou 

proportionate to the club's use of public funds, prop:&: 

or staff, then we think that article III, section 51 is no 

obstacle to its operation. The board of regents has 

apparently made such determination, in the first instance, 

by implicitly approving the club's operation when it 

approved an item for the club's expenses in the university 

budget. 

Whether the university receives an adequate gl&j 

pro aup for the club's use of public property and funds 

ultimately involves questions of fact. We think that this 

determination is for the regents in the first instance. 

We assume, for the purposes of this opinion, that other 

legal requirements have been met. See. e.a., V.T.C.S. art. 

6252-5~ (corporation performing an auxiliary enterprise 

service must present a financial statement, provide payment 

statements, and execute a bond payable to the state): j& 

art. 6252-llf (state agencies must enact rules governing the 

relationship between the agency and "a private organization 

1 

? 

P. 6054 
Honorable Wilhelmina Delco - Page 5 (JR-1146) 

designed to further the purposes and duties of the agency"); 

Educ. Code 5 61.0572 (coordinating board approval of space 

utilization in all educational and general buildings). 

SUMMARY 

The operation of a faculty club as an 

auxiliary enterprise of Texas A L M University does not violate article III, section 

51, of the Texas Constitution as long as it 

serves a public purpose or the university 

receives an adequate ouid ore QUO. 

Very truly yo , J nl, b 

JIM MATTOX 

Attorney General .of Texas 

MARYRELLER 

First Assistant Attorney General 

JUDGE ZOLLIE STRARLEY 

Special.Assistant Attorney General 

RENEA HICKS 

Special Assistant Attorney General 

RICK GILPIN 

Chairman, Opinion Committee 

Prepared by Karen C. Gladney 

Assistant Attorney General 

P. 6055