November 30, 1990 

Mr. Dennis R. Jones 

Commissioner 

Opinion No. JM-1252 

Texas Department of Mental Re: Whether section 

Health and Mental Retardation of the Mental Health 

P. 0. BOX 12668 Mental Retardation . 

2.13 

and 

Act 

Austin, Texas 78711-2668 authorizes the Department 

of Mental Health and 

Mental Retardation to purchase and/or lease real 

and personal property for 

the purpose of providing 

community-based services 

without following the procedures of the State Purchasing and General 

Services Act (RQ-2049) 

Dear Commissioner Jones: 

You ask whether section 2.13 of the Texas Mental Health 

and Mental Retardation Act authorizes the Texas Department 

of Mental Health and Mental Retardation [the l'departmentl'], 

to purchase or lease personal property, or to lease real 

property, in connection with the provision of community-based mental health and mental retardation services under 

that act, without being subject to the provisions of the 

State Purchasing and General Services Act, V.T.C.S. article 

601b. See V.T.C.S. art. 5547-201 et sea. (the Texas Mental 

Health and Mental Retardation Act). 

Article 601b provides that the State Purchasing and 

General Services Commission [the 18commission**] "shall 

purchase, lease, rent, or otherwise acquire all supplies, 

materials, services, and equipment for all state agencies."1 

1. Section 3.01(a)(4) makes exception for "materials, 

supplies, or equipment purchased by a state-owned hospital 

(Footnote Continued) 

P. 6671 
Dennis R. Jones - Page 2 (JM-1252) 

Id. S 3.01(a). Article 6 of that act provides that "[w]hen 

a state agency needs space to carry on its functions [it] 

shall submit a written request for the space to the commission." Id. 5 6.02(a). If state-owned space is not available "the commission may lease space for the agency from 

another source.lV & 5 6.05(a). Under such a lease 

contract "the State of Texas, acting through the commission, 

is the lessee." & 0 6.05(e).2 

The department is clearly a state agency within the 

purview of the provisions of article 601b. Seeid. 

§ l-02(2) (defining "state agency"). Attorney General 

Opinion JM-978 (1988) noted that a "state agency . . . is 

subject to the provisions of article 601b . . . unless 

exempted by the legislature." YOU suggest that the 

department has authority under the circumstances YOU 

describe to purchase or lease personal property or to lease 

real property without being subject to the requirements of 

article 601b. 

Article 5547-204 provides specifically for the department's duties regarding "community-based services,UV the 

context in which your question about the department's purchasing and leasing authority has arisen. Section 4.03, in 

subsection (a), lists the minimum services that must be 

available in each service area and, in subsection (b), 

directs the department to contract with "designated 

providers" in each service area to provide the services 

directly or by subcontract. "Designated providers" may be 

(Footnote Continued) 

or clinic" under the circumstances set out there. Section 

3.06 provides that the commission may delegate to a state 

agency authority to purchase supplies, materials, and 

equipment in accordance with commission-prescribed procedures. Section 3.07 provides for emergency purchases. 

Section 3.08 provides that "state agencies are delegated the 

authority to purchase supplies, materials, and equipment if 

the purchase does not exceed $500" but that the commission 

shall prescribe procedures for these purchases. You neither 

reference any of these provisions nor supply us with facts 

indicating they are relevant to the situations you are 

concerned about. We will therefore not address them here. 

2. See also 1 T.A.C. 55 113.1 et sea. (commission 

rules regarding purchasing), 115.31 et sea. (commission 

rules regarding leasing of space). 

P. 6672 
Dennis R. Jones - Page 3 (JM-1252) 

"community centers"3 operated by certain local governmen:; 

entities, other local agencies, or private providers. 

5 4.03(b). "If the Department is unable to identify s 

contract with a designated provider in a service area, the 

Department shall provide the services required under this 

article directly through a departmental facility outreach 

program." & 

Section 4.01A of article 5547-204 provides that the 

term "mental health or mental retardation authority8' is used 

in the article to refer to both a "designated provider" and 

a "departmental facility outreach program." You indicate in 

your request that under some contracts with designated 

providers, and for some departmental outreach programs 

established under article 5547-204, the department must 

acquire and provide equipment, supplies, and facilities to 

be used by such mental health or mental retardation 

authorities in rendering the community-based services. YOU 

suggest that section 2.13 of the Mental Health and Mental 

Retardation Act, if read together with section 4.03C, 

provides the department with authority to acquire such 

property under the "competitive procurement system" 

established under section 4.03c, rather than under the 

requirements of article 601b. We disagree. 

Section 2.13 of article 5547-202 provides: 

The Department may cooperate, negotiate and 

contract with local agencies, hospitals, private organizations and foundations, community 

centers, physicians and persons to plan, 

develop and provide community-based mental 

health and mental retardation services. 

Section 4.03C of article 5547-204 reads, in pertinent 

part: 

(a) This section applies only to a contract to provide service for persons with 

mental retardation or mental illness at the 

'community level, including residential 

services, that: 

3. m V.T.C.S. art. 5547-203 (providing for establishment and operation of "community centers"). 

P. 6673 
Dennis R. Jones - Page 4 (JM-1252) 

(1) is between a private provider and a 

mental health or mental retardation authority: 

(2) involves the use of state funds or 

funds for which the state has oversight 

responsibility: and 

(3) is initially awarded on or after 

August 30, 1989. 

(b) The department shall design a competitive procurement or similar system that a 

mental health or mental retardation authority 

shall use in awarding a 'cktract under this 

section. 

See also 25 T.A.C. 5s 401.377 - 401.385 (the departmentts 

rules promulgated pursuant to section 4.03C). 

We find nothing in sections 2.13 or 4.03C which indicates that the legislature intended these sections to 

provide exemptions from article 601b for leases or purchases 

of property by the department. 

Even if the procurement system provided for in section 

4.03C might arguably be made applicable to departmental 

procurements where the mental health or mental retardation 

authority to be contracting for services with a private 

provider is a departmental facility outreach program, that 

section applies only to contracts with a provider. If, 

under such a contract, a departmental facility outreach 

program is to provide space or property to be used in 

rendering the services, the department's acquisition of such 

space or property is not exempt from article 601b. See 

Attorney General Opinion JM-445 (1986) (purchases by Texas 

Surplus Property Agency with funds from Service Charge Trust 

Fund subject to article 601b). s Attorney General Opinion 

JM-978 (1988) (administration of medicaid program for 

Department of Human Services). CornDare Attorney General 

Opinion H-459 (1974) (the predecessor to article 601b did 

not apply to a short-term rental of space by the Texas 

Rehabilitation Commission for a client of the commission). 

1 

P. 6674 
Dennis R. Jones - Page 5 (JM-1252) 

SUMMARY 

Where the Department of Mental Health and 

Mental Retardation purchases or leases 

personal property, or leases real property, 

to be used in connection with the provision 

of community-based services by a mental 

health or mental retardation authority under 

the Mental Health and Mental Retardation Act, 

section 2.13 of that act does not exempt 

those acquisitions from the provisions of 

article 601b, the State Purchasing and 

General Services Act. 

JIM MATTOX 

Attorney General of Texas 

MARYKKLLKR 

First Assistant Attorney General 

LOU MCCREARY 

Executive Assistant Attorney General 

JUDGE ZOLLIE STEAKLKY 

Special Assistant Attorney General 

RENEA HICKS 

Special Assistant Attorney General 

RICK GILPIN 

Chairman, Opinion Committee 

Prepared by William Walker 

Assistant Attorney General 

P. 6675