OFFICE OF THE ATTORNEY GENERAL OF TEXAS AUSTIN

Honorable W.J. UoConnell, Preeldmt North TexarrState Teaoherrs Collage Denton, Texan

Dear Sir: Opinion Number04eO;‘~ \ Re: Doe6 $hho‘.?Oaxd or Re+&nttrj of NcirthTexas State Teds&-

November 7th.

aspfollowa;

Veo. 1. * * * and the Board or R6genta or the State Teaohere College * * l are hereby aevorally authorized and empoweredto oonetruot or aoquire through runas or loans to be obtalnsd from the Government 0r the United States, or any agenoy or agenolea .thereor, oreated under the National Reoovery Aot, or oth%rwlse oreated by .the Federal Government or from any other aouroeHonorable W. J. EoConnell, page $8

private or publlo, without oost to the State or Texas, andaooept title, subjaot to suoh oondltlona and 1lmLtations aamaybe presorlbadby eaoh of said Boards, dormitories, kltohensand dining hells, hospitals, libraries, student aotlvity buildings, -ala, athletlo buildings andstadla, and auoh other buildinga as maybe needed ror the good of the lnatltutlon andthe moral welfare and social oonduot 0r the 5tUa5nt5 or such inetltutlona 

### whenthe total ooat, type or oonstruotlon, oapaolty or suoh buildings, ee well as the other plans and apeolrloatlons hsve been approved by the respectlva Governing Boards; provided, hOwever, that the Leglalature shall never makean appropriation out or the general rpnd 

### or thla State, either in the regular approprletlon bill 

### or in a supplemental or emergenoy approprletlon bill, ror the purpose or’ equipping or 

### ror the purpose or purohasing and installing anyutility oonneotlona.in any of the buildings ereoted under andby virtue Orthe provlalons or thla Aot.*
"QBO. i?. * * *That said Boords are further authorized to makeany oontrsot with reference to the collectlon ead dispodltion of the revenuee &rived rmn anr builainix a0oonstruoted in the 5OWi.5itiOn OT OOI35trUOtiOn. loeMK5ment. andmaint5nanOeof any buildlnR or buildinna’aoauired hereunder. In reference to the aoquisitlon or student activity bulldlngs, stadla, gymnasia, and all oharaoter or athletlo buildings, sald,Boarda are authorized also to makeoontraote with reference to the oolleotlon 6na disposition or rqvenuea to aoorue to suoh respeotlve lnatltutlone rrom sctlvltlea, athletlo events, and games inwhich said reopeotlve institutiona psrtlolpate away from said Institutions, a6well as at said inetltutlons; and in antlolpatlon oi the colleotlon oi such revenuea, and for the purpose of paring the cost or the oonetruotlon or aoqulsltion 0r ealdHonoreblb V. J. YoOonnell, page $3

‘building or buildings and grcunda, said Boards 

### are severally ampolosredbyresolution to euthorize, sell, and~dellver lta negotiable bonds or notea mm tima to tlaas OBdin suoh emountor amounts

### as It msyoonalder 

### naoeasary. The

### reea and otmrgea so rlxad ror the use or any such bulldlng.or buildings shell not be collected arter payment In full shell have been oonpleted ror the bullding or bulldlnge Sor which said rees shall be pledged. Theraatter the right of said respaotlve Boarde to fix oharges en$ fees shell depend on laws other than this Act ae hereby-emended. Anybonds or notes Issued hereunder shall beer lntereat at not to exoeed air (6% ~peroent per annum,and shall-rlnally meture not more.than forty years from data.” Wee. 3. Sub&at to the above reatriotlona, each of said Boardd Is given complete dlsoretion In riring t?ie r0m,. oonaltlona end betalla or suoh bonds or notesb’ Any bonds or notes issued hereunder shell not be 

### an indebtedness’b~ the State of TemS,‘but ahall be-payable solely ‘rrom the revanuaa to be derived rrom the operetion~ or seld buildingsi provided that euoh bondamsybe 

### retlnanoed by.the aaLaBoarda whenever auoh aotlon is round by the Board to be neoetmaryi WProvlded,~however, that tbe~provIalona or this I Aot shell not epply,.~to,any proceadlnga, levlae, or to any bonde or warrenta issued thareunder, the valIalty or which baa’been Oont56tQd or attachsd in suit or lltlgatlon.whIoh la pandI!q at the-time this Act becomes e law, or which maybe riled within thirty (30) dsya.qrter this Aot:beoonee a law.”
.~ ~.

‘+ ‘*~~* a Y /

“See. 9. movlaea further that each or said Boards megmekesuch oontreota aa rzaybe neces-

-Honorable X. J. UoConnell, page $4

Under thIa artlolc the Legislature has authorlzad the Boer8 of Ragents of North Texas Ststa Teaoher6 College to aoqulre oertaln revenue-bearing property and to makeany oontreot with re~erenoa to the oolleotlon and dlsposftlon or the revenuea derived rrom any bulldlng so oonstruoted in the aoqu.lsltfon 

### or oonatruotlon, msnegamentanaz3alntenenoe of anybeilalng or buildinga aoqulr

### adthereunder.

Thererore, it ii3the oplnIo~ or this department that the Board ot Regents has the authority to enter into a contreot with reference. to insuring said property and to pledge aportion or the lnooloe from revenue-bearing properties .for lnsuranoe purpoaes;when said property has been aoquired under the euthority,, of Artlole 26030, Vernon’s Annotated Civil Statutes. :i

Ii bonds are Issued in Faymentor the‘oonstruotlon

or buildinga euthorlzcd under-thla article, it la our opinion that the Board hns the authority to oontraot in the bond order that a~oertaln portlcn of the rev8nuea be set as186 to pay for the lnauranoe on said bulldln&3.r,; The bond order in suoh ceaea usually oontalna a olausa ei3ltlar .f,o the following t

93uoh portion Grthe grosa revenues CObe received rrom the operation or said ~dormitory as ~%ybe required to oreate andmelntein the

runae hereinatter provided tar shall be set eslae monthly into two separate end spcolal funda, which are hereby provided tor,and oreated, the first of which funds ahall be knownas CFER~ITICN

AXDh%I?iENA?:CEZ’CXD,and the seoond Or which shall be knownae BOND Frm, There shell be kept within the BGSDFED asreolal aocount hereby provided for and cr%attd,,, known as the RESXRVX

ACCOUNT.TheOPERATIGN A?JDUAINTmxcE FUND

shall be at all times eutrioient to provide for tho reasonable cost or maintain-

~~~~~~~~~~~~~':~~~~~l~~~u~~~~~ :Ei%&+Fshall be :n the amounts and aoomuleted In ihe manner~proviaea ror * * ** (~ndersooring ours).

## 31

Honorable W.S.,bWonnel1, page #S

However, weaall your attention to the fact tbst this depesrtaent kas repeatedly held that no insurenoe polioy ahull be takeri out upon any of the publlo building8 OSthin State, nor upon the oontentr thereof, in the absenoe of 8 speoltio appropriation for **that** pwrpoee. The reason for thle holding la atstsd in our opinions xwtibers o-3000, O-104 and o-201, oopler of which are enclosed ror your informtion.

Theretore, fire lnsuranoe Fremiwne cannot be paid out of the loos1 oolleqe funan or coy otber rued or the college, In the absence of express le&ilstive authority. However, Artiole 2CkO3o gives to the Board of Regenta power tq oontraot to keep buildings erected under the authority or that artlole insured ror the protection of bondholdera. Such insuranos nues collected B

remltms my be aid only out ot the reveron the partlcu ar building or build3qa

P covered by the bond iaaue.

Trusting thet- thle answera your questIon, weare

P.ICW? ASSISTANT ATTCI~XY

GENERAL

COB-s %lols.