- . 

THE ATTOWNEY GENERAL 

Q,P TEXAS 

PRICE DANIEL 

AUUTIN ~.TEXAS 

.m*ORNEY GENERAL 

June 28, 1951 

Hon. Allan Shivers Opinion No. V-1198 

Governor of Texas 

Austin, Texas He: 

Dear Governor: 

You have requested the 

constitutionality of House Bill 603. 

Constitutionality of House 

Bill No. 603, authorizing 

agreements between the 

State of Texas and the Federal Government to extend 

Federal old-age and survivors insurance coverage to 

certain public employees. 

opinion bf this office on the 

House Bill 603 provides that the State Department of 

Public Welfare, hereafter referred to bs the State Agency, shall 

administer the provisions of the Act. The State Agency is author’- 

ized to enter into agreements with the, Federal Security Administrator for the purpose of extending Federal old-age and survivors 

insurance coverage to employees of any of the counties or municipalities of the State other than employees engaged in performing 

.serw .d es in connection with a proprietary function. 

The State Agency is authorized to enter into agreements with the governing bodies of eligible counties and municipalities when such counties and municipalities desire old-age and 

survivors insurance coverage for employees covered by the Act. 

The term “employee” is defined as including an officer or employee of a county or municipality. H.B. 603, Sec. l(c). 

Section 8 reads, in part, as follows: 

“Each county or municipality as to which a plan 

has been approved . . . shall pay to the State Agency 

. . . contributions in the amounts and at the rates specified by the applicable agreement. . . . Counties or 

municipalities . , . are authorized, in consideration of 

the employees retention in or entry upon employment, 

to impose upon its employees . . . a contribution with 

respect to wages in keeping with applicable State and 

Federal requirements. Contributions so collected 

shall be paid to the State Agency in partial discharge 

of the liability of the county or municipality, but failure 
Hon. Allan Shivers, Page Z. (V-1198) 

to deduct contributions from employees’ wages shall 

not relieve the employee or the employer of liability 

for the contribution. . . . Matching contributions by 

the employing counties or municipalities . . . shall be 

paid from the respective source of funds from which 

covered employees receive their compensation.” 

The respective governing bodies of the various counties or municipalities are authorized to pay out. of any available 

funds not otherwise dedicated such amounts as may be necessary 

to finance their proportionate share of the administrative cost of 

the program at the State level. At the end of each fiscal year, the 

State Agency must pay from the Social Security Administration 

Fund to the State Treasurer for deposit to the General Revenue 

Fund of the State of Texas an amount not less than ten per cent 

(10%) of the payments made to such fund during the preceding year 

until such time as the amount appropriated to the State Agency 

from funds of the State for administrative purposes has been reimbursed in full. 

Section 11 empowers the State Agency to collect any 

delinquencies and interest thereon from counties and municipalities. Likewise, the State Agency “may direct the deduction of any 

delinquent payments with interest from any moneys payable to the 

delinquent county or municipality by the State or any department 

or agency of the State, provided, however, that deductions shall 

be made only from such prior appropriations as were expressly 

made subject to such deductions. The Comptroller and the State 

Treasurer are empowered and directed to comply with the State 

Agency’s deduction directives and to remit the deducted amounts 

to the State Agency in trust for the contributions of th& delinquent 

county or municipality. ” 

Section 6 provides that the respective governing bodies 

of such counties and municipalities as enter into agreements with 

the State Agency under the Act are authorized to pay contributions 

as required by these agreements from those funds from which the 

covered employees receive their compensation and “it is expressly 

provided that all prior laws and parts of laws which fix a maximum 

compensation for any covered employees of counties are hereby 

amended td allow payment of the matching contribution necessary 

to this program in addition to any maximum compensation otherwise fixed by law.” 

Section 7 of the Act authorizes counties and municipalities to submit for approval by the State Agency plans for extending 

the benefits of the Federal old-age Cl.l-id survivors insurance system 

to the employees of the county or municipality other than those 

engaged in p.:rforming services in connection with a proprietary 
- . 

Hon. Allan Shivers, Page 3 (V-1198) 

function of the subdivision. Submitted plans must meet stated 

requirements, one of which is that each plan must specify the 

source or sources from which the funds necessary to make the 

payments required are to be derived and must contain guarantees 

that these sources will be adequate for this purpose. The State 

Agency may require guarantees in the form of surety bonds, advance payments into escrow, detailed representations and assurances of priority dedication, or any legal undertaking to create 

adequate security that each county or municipality will be financially responsible for its share in the program for at least a 

minimum period equivalent to that specified by Federal requirements to precede coverage cancellation. 

Section 12 establishes “a special fund, separate and 

apart from all public moneys or funds of this Stdte, to be known 

as the Social Security Fund, which shall be administered as directed by the State Agency exclusively for the purposes of this 

Act. The State Treasurer shall be treasurer and custodian of the 

fund. He shall administer such fund in accordance with the directions of the State Agency, and the Comptroller shall issue warrants 

upon it in accordance with such regulations as the State Agency 

shall prescribe. The State Agency shall deposit all moneys collected under the provisions of this Act, except moneys to defray 

administrative expenses at the State ,level, in the Social Security 

Fund. All moneys so deposited with the State Treysurer in the 

Social Security Fund shall be held in trust, separate and apart 

from all public moneys or funds of this State. The State Agency 

is vested with full power, authority, and jurisdiction over the fund 

and may perform any and all acts necessary to the administration 

thereof and to pay the amounts required to be paid to the appropriate Federal authorities and any refunds or adjustments necessary under this Act.” 

Moneys collect.ed from counties and municipalities to 

defray the cost of administrative expenses are to be deposited in 

another special fund of which the State Treasurer is made treasurer and custodian subject to the directions of the State Agency. 

The moneys in both funds are to be disbursed upon warrants issued by the Comptroller of Public Accounts pursuant to sworn 

vouchers executed by the State Agency. Section 13 states that 

“These funds will not be State funds, and shall not be subject to 

legislative appropriation.” 

Section 14 appropriates the sum of $ZO,OOO.OO to the 

State Agency “for the purposes enumerated in Section 13 and to 

investigate,, study, negotiate, defend, and administer this program 

during the two (2) years immediately succeeding the effective date 

of this Act.” 
. . 

Hon. Allan Shivers, Page 4 (V-1198) 

Section 15 contains the usual severability clause and 

Section 16 declares an emergency. 

House Bill 603 is designed to take advantage of Section 106 of the “Social Security Act Amendments of 1950.” Public 

Law 734--8lst Cong. Section 106 amended Title 2 of the Social 

Security Act by adding Section 218. (42 U.S.C.A. Sec. 418.), 

The first paragraph of Section 218 reads as follows: 

“(a)(l) The Administrator shall, at the request 

of any State, enter into an agreement with such State 

for the purpose of extending the insurance system established by this title to services performed by individuals as employees of such State or any political 

subdivision thereof. Each such agreement shall contain such provisions, not inconsistent with the provisions of this section, as the State may request.” 

Section 218(b) defines certain terms used in Section 

218. The term “coverage group” is defined as follows: 

“(5) The term ‘coverage group’ means (A) employees of the State other than those engaged in performing service:; in connection with a proprietary 

function; (B) employees of a political subdivision of a 

State other than those engaged in performing service 

in connection with a proprietary function; (C) employees of a State engaged in performing service in connection with a single proprietary function; or (D) employees of a political subdivision of a State engaged in 

performing service in connection with a single proprietary function. . . .” 

Paragraph (c)(l) of Section 218 reads as follows: 

“An agreement under this section shall be applicable to any one or more coverage groups designated 

by the State.” 

Paragraphs (c)(2), (c)(3), (c)(5), and (c)(6) deal with 

the services to be included in agreements relating or applicable 

to each coverage group. 

Paragraph (c)(4) provides that prior agreements with 

a State may be modified so as to include any coverage group to 

which prior agreements have not applied or so as to include services previously excluded from the agreement consistently with the 

provisions of the section of the Act applicable in the case of an 

original agreement. 
Hon. Allan Shivers, Page 5 (V-1198) 

218! 

We quote in full the following paragraphs of Section 

“(d) No agreement with any State may be made 

applicable (either in the original agreement or by any 

modification thereof) to any service performed by 

employees as members of any coverage group in positions covered by a retirement system on the date such 

agreement is made applicable to such coverage group.” 

“(e) Each agreement under this section shall 

provide - - 

“(1) that the State will pay to the Secretary of 

the Treasury, at such time or times as the Administrator may by regulations prescribe, amounts equivalent to the sum of the taxes which would be imposed 

by sections 1400 and 1410 of the Internal Revenue Code 

if the services of employees covered by the agreement 

constituted employment as defined in s,ection 1426 of 

such code; and 

“(2) that the State will comply with such regulations relating to payments and reports as the Administrator may prescribe to carry out the purposes of this 

section. ” 

“(g)(l) Upon giving at least two years’ advance 

notice in writing to the Administrs.tor, a State may 

terminate, effective at the end of a calendar quarter 

specified in the notice, its agreement with the Administrator either-- 

“(A) in its entirety, but only if the agreement 

has been in effect from its effecti’/= date for not less 

than five years prior to the receipt of such notice; or 

“(B) with respect to any coverage group designated by the State, but only if the agreement has been 

in effect with respect to such coverage group for not 

less than five years prior to the receipt of such notice. 

“(2) If the Administrator, after reasonable notice and opportunity for hearing to a State with whom 

he has entered into an agreement pursuant to this section, finds that the State has failed or is no longer 

legally able to comply substantially with any provision 

of such agreement or of this section, he shall notify 

such State that the agreement will be terminated in its 
. 

Xon. Allan Shiver.s, Page 6 (V-1198) 

entirety, or with respect to any one or more coverage groups designated by him, at such time, not later 

than two years from the date of such notice, as he 

deems appropriate, unless prior to such time he finds 

that there no longer is any such failure or that the 

cause for such legal inability has been removed, 

“(3) If any agreement entered into under this 

section is terminated in its entirety, the Administrator and the State may not again enter into an agreement pursuant to this section. If any such agreement 

is terminated with respect to any coverage group, the 

Administrator and the State may not thereafter modify 

such agreement so as to again make the agreement 

applicable with respect to such coverage group.” 

“(j) In case any State does not make, at the time 

or times due, the payments provided for under an agreement pursuant to this section, there shall be added, 

as part of the amounts due, interest at the rate of 6 

per centum per annum from the date due until paid, and 

the Administrator may, in his discretion, deduct such 

amounts plus interest from any amounts certified by 

him to the Secretary of the Treasury for payment to 

such State under any other provision of this Act. Amounts so deducted shall be deemed to have been paid 

to the State under such other provision of this Act. 

Amounts equal to the amounts deducted under this subsection are hereby appropriated to the Trust Fund.” 

“(k) The Administrator may,at the request of 

any instrumentality of two or more States, enter into 

an agreement with such instrumentality for the purpose 

of extending the insurance system established by this 

title to services performed by individuals as employees 

of such instrumentality. Such agreement, to the extent 

,practicable, shall be governed by the provisions of this 

section applicable in the case of an agreement with a 

State.” I 

It is clear from the above summary of House Bill 603 

that its provisions devolve financial responsibility upon participating countiesand municipalities. In other words, the State Agency 

will simply receive or, if necessary, collect the payments due 

from the counties and municipalities and will transmit the proper 

portion of said payments to the Secretary of the Treasury of the 

United States. The authorization to the governing bodies.of such 

counties and municipalities as obtain coverage for their employees 

to meet this financial obligation by paying contributions in the 
. . 

Hon. Allan Shivers, Page 7 (V-1198) 

amount required by the Federal Act from funds from which the 

covered employees receive their compensation (H.B. 103, Sec.6) 

is not obnoxious to Sections 51 and 52 of Article III of the Constitution of the State of Texas nor to Section 3 of Article VIIL1 This 

is so because House Bill 603 does not authorize or attempt to authorize a gratuity. The employee’s right to receive the coverage 

benefits will be a part of the agreed compensation paid for services rendered.’ Byrd v. City of Dalla$, 118 Tex. 28, 6 S.W.2d 730 

(1928); Friedman v. American Surety Co. of New York, 137 Tex. 

149, 15< 

Despite the fact that House Bill 603 contemplates that 

participating counties and municipalities--not the State--shall 

shoulder the financial burdens incident to obtaining coverage for ’ 

their officers and employees, it is equally clear that the Federal 

Act requires the State to be the responsible party to any agreement with the Administrator for coverage for such officers and 

employees. Under the Federal Act the State is the only party authorized to enter into agreements with the Administrator, Se&. 218 

(a),(l),, and to modify or terminate such agreements, Sec. 218(c)(4) 

and Sec. 218(g). The State must make the payments and reports 

required by the Act, Sec. 218(e) ; and, in the event the State does 

not make the payments provided for under the agreement at the 

time said payments are due, six per cent interest will be added 

thereto until paid; and the amount due, plus such interest, may, 

in the discretion of the Administrator, be deducted from payments 

to the State under any other provision of the Social Security Act, 

and shall be deemed to have been paid to the State under such other 

provision, Sec. 218(j). 

’ The pertinent portions of these constitutional provisions read 

as follows: 

Art. III, Sec. 51: “The Legislature shall have 

no power to make any grant or authorize the making 

of any grant of public money to any individual, association of individuals, municipal or other corporations 

whatsoever. . .*’ 

Art. III, Sec. 52: “The Legislature shall have 

no power to authorize any county, city, town or other 

political corporation or subdivision of the State to lend 

its credit or to grant public money or thing of value 

in aid of, or to any individual, association or corporation whatsoever. . .‘* 

Art. VIII, Sec. 3: “Taxes shall be levied and 

collected by general laws and for public purposes only.” 
. . 

Hon. Allan Shivers, Page 8 (V-l 198) 

It must be conclusively presumed, of course, that the 

Legislature was familiar with the provisions of the Federal Act 

and that therefore it intended to authorize the State Agency to enter into such agreements with the Federal Security Administrator 

as are contemplated by the Federal Act. We will next consider 

whether the Legislature may validly authorize a State agency to 

enter into the type of agreement required by the Federal Act in 

order to obtain coverage for the officers and employees of the 

counties and of municipalities of the State other than employees 

engaged in performing services in connection with a prbprietary 

function. 

Section 50 of Article III of the Constitution of the State 

of Texas reads, in part, as follows: 

“The Legislature shall have no power to give 

or to lend, or to authorize the giving or lending, of 

the credit of the State in aid of, or to any person, association or corporation, whether municipal or other, 

or to pledge the credit of the State in any manner 

whatsoever, for the payment of the liabilities, present or prospective, of any individual, association of 

individuals, municipal or other corporation whatsoever.” 

If the agreement required by the Federal Act and authorized by House Bill 603 amounts to a lending of the State’s credit 

to the counties or municipalities whose officers and employees will 

obtain coverage, the Act would be invalid. A limitation on the power of the Legislature to lend or give the state’s credit does not 

apply to a loan or gift of the state’s credit for state purposes. 59 

C.J. 208, States, Sec. 346. In construing the prohibition contained 

in Section 50 of Article III, the Supreme Court in City of Aransas 

Pass v, Keeling, 112 Tex. 339, 247 S.W. 818, 820 (lY23), made the 

tXiowin8 statGirent: 

“To the extent that the State aids in protecting 

Aransas Pass from the menace of storms through a 

grant of part of the State taxes, shfe discharges a State 

obligation, and.hence no questionil.rises as to lending 

or pledging the State s ~credit to a municipal corporation or for payment of the liabilities of such a corporation. (Emphasis added.) 

We are of the,opinion that to the extent the State aids 

its counties in obtaining coverage agreements for their officers 

ar.d employees under the Federal Act, it is likewise discharging 

a State obligation and that therefore no question can arise as to 

me lending or pledging of the State’s credit in their behalf. The 
Hon. Allan Shivers, Page 9 (V-1198) 

decisions in this State are uniform in their recognition of counties as agencies of the State through which the State discharges 

the duties which the State as an organized government assumes 

to every person and by which it can best promote the welfare of 

all. City of Galveston v. Posnainsky, 62 Tex. 118 (1884). The 

functions of county officers and employees are so tied in with 

State government as to be essential to its proper functioning; and 

the State, therefore, has a very vital interest in the efficient functioning of county government. It is obviously in the best interest 

of the State to attract to, and retain in the service of, the counties 

the highest type of officers and employees. That there is an inducement to enter and remain in the services of an employer who 

provides some form of retirement or pension plan is so well recognized as to require no elaboration. Thus, providing some such 

plan is of vital concern not only to the county but also to the State 

as a whole. The proper method for making such provision, the 

particular plan, is a matter which properly lies within the discretion of the Legislature. This discretion the Legislature has exercised, and the coverage agreements for county officers and employees, as authorized by House Bill 603, do not constitute a lending 

of the State’s credit within the meaning of the constitutional prohibition. 

This construction of Section 50 of Article III is consistent with the construction which has been placed upon Section 

51 of Article III by those decisions which recognize that the prohibition against legislative grants of public money to any individual, 

association of individuals, municipal or other corporations does 

not prohibit an appropriation of State funds to counties to be used 

by them in carrying out a part of the duties or governmental functions which properly rest on the State. Jefferson County v. Board 

of County and District Road Indebtedness, 143 Tex. 99, 182 S.W. 

2d 908 (1944). A contrary interpretation of Section 50 of Article 

III would do violence to the well established principle that the Constitution must be construed as a whole so as to give effect to all 

its provisions, and, if possible, to harmonize them. Texas Nat. 

Guard Armory Board v. McGraw, 132 Tex. 613, 126 S.W.Zd 627, 

-therein. 

We will next consider whether agreements entered into by the State to obtain coverage for employees of municipalities, 

other than those engaged in performing services in connection with 

a proprietary function, would constitute a lending of the State’s 

credit in violation of the prohibition of Section 50 of Article III. 

Although municipal corporations have been said to be 

created primarily to regulate the internal concerns of the inhabitants of a defined locality in matters peculiar to the place incorporated, Bexar County v. Linden, 110 Tex. 339, 220 S.W.Zd 61 (1920), 
Hon. Allan Shivers, Page 10 (V-1198) 

nevertheless they’have a two-fold character, one governmental 

and the other private, and, in so far as their character is governmental, they are agencies of the state, and subject to state control.” 

Yett v. Cook, 115 Tex. 205, 281 S.W. 837 (1926), and authorities 

cited therein; 1 Cooley, Constitutional Limitations (8th Ed. 1927) 

43. In Texas Nat. Guard Armory Board v. McGraw, supra, the 

court said: 

“The State has a vital interest in its cities. In 

its governmental capacity a city is a ptilitical subdivision of the State, and in many instances is considered 

as an agent of the State; and the State may use such 

agent in the discharge of its duties.” 

The agreements authorized by House Bill 603 would 

obtain coverage only for such employees of municipalities as are 

engaged in governmental functions as distinguished from proprietary functions. We think that the State’s interest in the efficient 

discharge of city government is equally as great as its interest 

in the efficient discharge and functioning of county government. 

The whole is no better than the sum of its parts, .and we think that 

the public benefit to be derived from the maintenance of the highest type of local government clearly imposes a duty and an obligation upon the State to aid in obtaining such government. The 

reasoning which justifies the assumption of an obligation on the 

part of the State to aid the counties in the efficient discharge of 

county functions justifies a State obligation which will enable municipalities to efficiently perform their governmental functions. The 

inhibition of Section 50 of Article III was never intended to prevent 

the State from lending its credit for proper purposes. If the State 

cannot use its credit for governmental purposes, a situation might 

well arise in which it could not function. Article III, Section 50 

and its related provisions in the Constitution of Texas which were 

enacted for the purpose of protecting public funds were never intended to apply to such legitimate use of the State’s credit. Rather, 

their purpose and those of similar constitutional provisions enacted 

by other states in the Union were to put an end to the use of the 

credit of the State in fostering private business, a practice which 

prevailed in the early days of the history of most states. 

The Supreme Court of Iowa, in construing the Iowa 

constitutional provision that “The credit of a state shall not in any 

manner, be given or loaned to, or in aid of, any individual, association, or corporation” stated that the provision was the result 

of the past experience of states in loaning their credit freely and 

extravagantly to corporate enterprises such as ~railways, canals, 

wate,rpowers, etc., and that it was for the purpose of inhibiting 

the incurring of obligations by the indirect method of secondary 

liability that the constitutional provision was enacted. Grout v. 
Iion. Ailan Shivers, Page 11 (V-l 198) 

Kendall, 192 N.W. 529, i95 Iowa 467 (1923). See also the dissentingioion by Judge Cardozo in People v. Westchester Nat. Bank, 

231 N.Y. 465, 132 N.E. 241 (19211. 

Had we any doubt as to the constitutionality of the provisions of House Bill 603 which we are presently discussing, the 

well settled rule that all doubts must be resolved in favor of const:itutionality wbuld require us to sustain these provisions. Brown 

v. City of Galve:ston, 97 Tex. 1, 75 S.W. 488 (1903); Greene v.- 

.~_. ..-~. 

<on, IT~x. 516 8 S.W.2d 655 (1928); Duncan v. Gabler, 147 

zn, 215 S.W.2d I;5 (1948); 9 Tex. Jur. 479 

Tex. 

C onstltutlonal Law, 

Sec. 60; 1 Cooley, Constitutional Limitatiods (8th Ed. 1927) 354i 355, 

375. 

Having concluded that the agreements authorized by 

House Bill 603 do not constitute a lending of the credit of the Stati, 

we pass to a consideration of whether any provision of the Texa.6 

Constitution will be violated by a compliance with the requirem& 

of Section 218(g) of the Federal Act that agreements entered i,nto 

between the states and the Administrator shall be binding &or at 

least a five-year period. 

The State’s right to contract is unlimited. except by the 

Constitution. As stated by the Supreme Gout-t in Texas Nat. Guard 

Armory Board v. McGraw, supra: 

“The subjects of contract,, the Length of term for 

which a contract may be made,, and the general policy 

re,lating to contracts, are clearly withm the power of 

the Legislature. The Constitution does not provide for 

the length of term for which a contract may be made 

by the State. The only provisions of the Constitution 

which might affect the term of a contract are those 

which prohibit the creation of any debt by or on behalf 

of the State (Section 49 of Article 3, of the Constitution) 

and that no appropriation of ,money may be made for a 

longer term than two years (Section 6 of Article 8 of 

the Constitution), and that monopolies shall never be 

allowed (Section 26 of Article 1 of the Constitution).” 

Under the provisions of House Bill 603 it is clear that 

no debt is created by or on behalf of the State; nor is any appropriation of money for longer than a two-year peridd attempted, We 

are therefore of the opinion that the legislative authorization to comply with the requirements of Section~218(g) is constitutional. 

The trust funds which are established by Section 12 of 

House Bill 603 are similar to the trust fund which was considered 

and upheld in the Friedman case, supra, in the face of the conten- 
Hon. Allan Shivers, Page 12 (V-1198) 

tion that the requirements of Section 6 of Article VIII of the State 

Corlstitution had not been met.2 The requisites of this provision 

are therefore satisfied. 

We have discussed only those provisions of the Constitution which raise some serious question as to the validity of 

the provisions of House Bill 603. We have not mentioned or discussed those provisions of the Constitution which are not involved 

or which are clearly satisfied, Likewise, we have not discussed 

any provisions of the Federal Constitution sixe none of its provisions cast any doubt upon the validity of this legislation. Our 

conclusion is that the Act is valid, and you are accordingly so advised. 

SUMMARY 

The provisions of House Bill 603 which authorize 

the State to enter into agreements with the Federal 

Government for the purpose of extending Federal oldage and survivors insurance coverage to employees of 

counties and municipalities of the State other than employees engaged in performing services in connection 

with a proprietary function do not constitute a lending 

of the State’s credit within the meaning of Section 50 of 

Article III, Constitution of Texas. The authorization to 

governing bodies of counties and municipalities to pay 

contributions in the amount required by the Federal 

Act from the funds from which covered employees receive their compensation is not obnoxious to Sections 

51 and 52 of Article III, or to Section 3 of Article VIII> 

since employees’ right to receive coverage benefits 

will be a part of the agreed compensation paid for services rendered. Byrd v. City of Dallas, 118 Tex. 28, 6 

S.W.Zd 738 (1928); Friedman v. American Surety Co. of 

New York, 137 Tex. 149, 151 S.W.Ld 570 (1941). The 

State may enter into a coverage agreement for the 

minimum five-year term, since the only constitutional 

provisions (Sec. 49, Art. III; Sec. 6, Art. VIII; Sec. 26, 

2 Section 6 of Article VIII reads, in part, as follows: 

“No money shall be drawn from the Treasury but 

in pursuance of specific appropriations made by law; 

nor shall any appropriation of money be made for, a 

longer term than two years. . .‘I 
Hon. Allan Shivers, Page 13 (V-1198) ,, 

,,, /. ,,. :,. 

~, I 

‘:~:,~Art. I, Tex. Const.) which may affect the term of a 

State contract have not been violated. See Texas Nat. 

Guard Armory Board v. McGraw, 123 Tex. 613 126 

. . (lm). The provisions of Ho,use Biil 603 

which create and provide for the administration of the 

Social Security Fund and the Social Security Administration Fund do not violate Section 6 of Article VIII of 

the Constitution. Friedman v. American’ Surety Co. 

of New York, supra. House Bill 603 is constitutional. 

Yours very truly, 

PRICE DANIEL. 

Attorney General 

APPROVED: B 

‘W, V. Geppert 

T,axation Division 

Assistant 

Jesse P. Luton, Jr. 

Reviewing Assistant 

Charles D. Mathews 

First Assistant 

MMC/mwb