May 23, 1963 

Mr. John S. Hovenga 

Executive Director 

Board of Regents 

State Teachers Colleges 

Box K, Capitol Stations 

Austin 11, Texas 

Dear Mr. Hovenga: 

Opinion No.~ C- 83 

Re: Whether the term "annuities" 

as used in Article 6228a-5,, 

Vernon's Civil Statutes,, 

embraces group annuities 

as well ,as individual annuity'contracts. Should 

the board of regents of 

the institutions of higher 

learning hold the master 

contract in the name of 

the board of regents of 

the respective Institutions 

or should contracts be lssued in the name of the 

annuitant only, even if 

the contract is classified 

as a group annuity. 

The questions submitted in your opinion request are 

as follows: 

"(1) Does the term Iannuities as used in 

the statute referred to in the caption (Article 

6228a-5,~ Vernon's Civil Statutes) embrace group 

annuities as well as 'individual annuity contracts? 

"(2) Shall the board of regents of the institutions of higher learning hold the master 

contract in the name of the board of regents of 

the respective institutions of higher learning, 

or shall contracts be issued in the name of the 

annultant only, even if the contract is classified 

as a group annuity?" 

Article 6228a-5, Vernon's Civil Statutes, reads as 

follows: 

-404.,- 
Mr. John S. Hovenga, page 2 (C- 83 ) 

"Local Boards of Education of the Public 

Schools of this state and the Go verning Boards 

of the state-supported institutions of higher 

education are hereby authorized to enter into 

agreements with their employees for the purchase 

of annuities for their employees as authorized 

in Section &03(b) of the Internal Revenue Code 

of 1954, as amended,." 

In regard to your first question, Article 6228a-5 

Vernon's Civil Statutes, does not limit the term "annuitiesL 

to either group or individual annuities. However, Article 6228a-5 

refers to Section 403(b) of the Internal Revenue Code. In Section &03(b) and the Internal Revenue Regulations for that Sectio'n 

and related Sections, no distinction has been drawn between group 

annuities and individual annuity contracts. Since the general 

term "annuities" has not been limited in either of these statutes, 

the Legislature must have intended the term to embrace both group 

and Individual annuities. In the absence of evidence to the contrary, common terms used in an enactmentshould be given their 

common meaning. 

1943) 429. 

2 Sutherland Statutory Construction (3rd Ed. 

As to your second question, Article 6228a-5 states 

that 'the board may enter into agreements with their employees 

for the purchase of annuities for their employees as "authorized 

in Sectionk03(bl,of the Internal Revenue Code of 1954, as amen& 

ed." (Emphasis added). This evidences the intent that these il 

annuities would be set up in a manner in which they would be "taxsheltered" annuities under the Internal Revenue Code and Reguiations. The question which you have posed to us +s one of mechanic: 

in the setting up of such a plan. In setting up your plan, you 

should dtscuss the details with representatives of the Internal 

Revenue Service and submit proposed plans to them for approval. 

SUMMARY 

The term "annui.ties" as used in Article 6228a-5, 

Vernonls Civil Statutes, embraces group annuities as 

well as individual annuity contracts. Whether the annuity contract should be held in the name of the Board 

of Regents of the school or in the name of the individual 

employees is a matter that you should discuss with the 

representatives of the Internal Revenue Service and submit plans to them for approval. 

. ..4..;1: 
Mr. John S. Hovenga, Pa& 3 (C- 83 ) 

Sincerely, 

WAGGONER CARR 

Attorney General 

Assistant 

JGN:mkh 

APPROVED: 

OPINION COMMITTEE 

W. V. Geppert, Chairman 

James M. Strock 

Wayne Rogers 

Pat Bailey 

Ben Harrison 

APPROVED FOR THE ATTORNEY GENERAL 

BY: Stanton Stone 

-406