OFFICE OF THE ATTORNEY GENERAL OF TEXAS 

AUSTIN 

Honorable Pat R. Hobo 

County Attorney 

:Sailey County 

Euleshoe, Texas 

Dear Sir: Opinion X0. 3-7343 

Re: Deposit of bend proceeds 

in County deposWo,ry. / 

~Lie have received your letter of October \23,\,1946, 

which ;\re quote, in part, as follows: -.x_ _. I_ / 'i 

‘,'; / 

"tpecial Road District 1-A of daif*.County,; 

Texas, consisting of about thre+Kourths ofthe \ 

total area of Dailey County, ,i-ssued\,~k625,00i3.L;D, ,> 

in road bonds, %..., 

1946. 

said bonds beincdated October l>, 

These bonds were of, ,_< 

constructing " 

said District. The bonds ha&been sdd and the 

Road District now,h'aX,the moheyfromthe sale of 

the bonds in hand. MuS,eshoe'State Bank, the County 

he bond or seare unable at 

f the fact that labor and materials 

secure at this time the Commisseems&j"limit such investments to bonds sold prior 

to April 12, 1943. Please advise us whether or not 

we can invest the proceeds from the sale of Road 

States obligations, in lieu of depositing the funds 

with a bank without lal>rful bonds or security deposits." 
. . 

Nonorable Pat R. Bobo - Pace 2 

Article 7523, Vernon's Annotated Texas Statutes, pravides as follows: 

"After approval and registration as provided by 

law relative to other bonds, such bonds shall continue 

in the custody and control of the Commissioners1 Court 

of the oounty in which they were iasusd, and shall be 

by said court sold to the highest and beet bidder for 

cmsh, either in whole or in parcels, at not less than 

their par value, and the purchase money therefor shall 

be placed in the county treasury of such county to the 

credit of the available road fund of such county, or of 

such politicai subdivision or road district of such 

Cc~~~~ip~s2~~ac~~selb:a~ ;I:*, Acts 19.6, 39th Leg.,lst 

This statute, it is seen, provides in positive language 

for the deposit of the proceeds of the road district bonds in 

the county treasury (i.e., 

et seq., V.A.C.S.). 

county depository under Articles 25&l+., 

Article 2547 provides for the filing of bonds or the 

pledge of securities by the county depository, and fixes the 

amount thereof. 

Artiale 2543 provides for an additional bond when 

"aftsr,the creation of a county depository . . . there shall ac- 

&e‘to the county or any subdivision thereof, an9 funds or 

moneys from the sale of bonds or otherwise . . ."-The article providds.for writtendemand by the Commissioners' Court upon the depository, and further, that: "Upon the failure of such depository to furnish such additional bond within thirty'(30) days 

from the date of such demand, the Commissioners Court may cause 

suoh special funds to be withdrawn, upon the draft of the county 

treasurer from such depository, and cause the same to be depoeited in soms solvent National bank or State bank whose combined 

capital stock and surplus is in excess of such special fund, and 

to leave the same or so much thereof as may not have been expended with such National bank or State bank of last deposit, until 

such time that such county deoo5itory ray have filed with the 

Commissioners' Court the requ%re:! additional bond, when such 

special fund or so much thereof as shall not have been expended 

shall be forthwith returned to and deposited with such county 

depository." The article furth,:, provides: "This requ:~rin;.; of 

such additional or special bond shall be optionai uith such Commissionerc' 'Jourt." 
Bonorable Pat R. Bobo - Page 3 

It would first seem that Article 2548 would answer 

all questions in whlah you are interested, for it makes provision for an additional bond, for the deposit of the speoial 

funds in other banks if the depository falls to furnish the 

additlonal bond, and further provldes that the requirement of 

an additional bond ia optlonal with the Commlsslonerr~ Court. 

Howover, Artiole 2547 wa8 amended in 1933 (Aotr 1933, 4Srd Leg., 

ah. 66). In setting the mount of the bond of the depository 

,,3he:ca$sndment provldesr . . . said bond or bonds to be in an 

'enOk& equal to the estimated highest dally balance of nuah 

oounty as determined by the Commis8ioners' Court, suoh estUsa- 

,ted'daily balsnoe to be In no event leas than seventy-five per 

c+int~of the highest dally balanae of said oounty for the next 

preaedlng year, less the amount of bond funds reoeived and exIt must have been the Intent of the Legislature that 

the underscored psrt of Article 2547, as anmnded, would have a 

mend&tory effeot. This Is evident because under Article 2548 

the Commissioners' Court already had the authority to requti an 

additional bond, but the exercise of the authority was expressly 

optional, The underscored part would, therefore, be pointless 

nnless it is given a mandatory effect. Moreover, it is our 

opinion that the language used clearly shows that this effeot 

was the one intended by the Legislature. 

Artiole 2548, insofar as it provldea that the requiring 

of an additional bond Is optdt~nal, confliots with the later eat; 

therefore, that part of Artlole 2548 was repealed. 

It follows that your first question should be answered 

as follows; The bond proueeds should be plaaed in the oounty 

de ository to the credit of the road district. Under Artiale 

25 fs 8, as modified by Article 2547, as amended, the Commlssloners* 

Court, at its first meetlng after such funds are deposited, or 

as soon thereafter as prautlcable, muat make written demand for 

ad additional bond (or pledge) to oover the amount of such bond 

proceeds. If the bank falls to furnish the additional bond 

within thirty days of the demand, the funds may be withdrawn 

and deposIted in a liatlonsl OP State bank as outlined in Artiale 
Honorable Pat R. Bobo - Page 4 

2548. Ii the 

of the thirty - - . . 

depository m&es it known prior to the expiration 

days that it will not furnish the bond, then the 

runds m8y tnereupon be withdrawn and deposited 8s Indicated In 

the prooeding sentence. In other words, the county does not have 

to wait the thirty days If it Is alear that the depository will 

not furnish the bond. 

enal. 

l3WS-al-mrJ 

We have said above that it is our opinion that the optional 

part of Article 2548 wes repealed by the 1933 amsndment; therefore, lf.the oounty depository fails to furnish the additional 

bond, then it is our further opinion that the Commlsalonera~ Court 

must aeleot another depository (See Artioles 2947 and 2556). If 

no appliaations 8re subtitted, then the Commissioners' Court 

should proceed under Artiole 2550. The bond proceeds should 

thereupon be deposited in the depository so selected. 

As to your second questlon. we have held In several oplnions that under Artlole 708b, Vernon's Annotated Texas Statutes, the 

proceeds of munloipaI bonds Issued or sold after April 12, 1943, 

m8y not be invetsed incbllgatlons of the United States. In OplnIon Ro. O-7393 we held that the proceeds of county rosd bonds 

issued In,1946 couldwt be so invested. That opinion Is appllcable to the questlon under consideration, 

1s enclosed foqr$our consideration. 

and 8 copy of the opinion 

Based upon this opinion, you 

are advised that your question is answered in the negative. . 

Very tn%y yours 

ATTORREY CD?.RERAL OF TRXAS 

APPROVEQ) xwv 1, 1946 

/a/ Orover Sellers 

ATTORNEY GEI03RAL OF TEXAS 

APPROVD OPIIiION COmT!ll?.E BY /a/ B. W. B, CRAIRMAN