The Attorney General of Texas 

March 11,1981 

MARK WHITE 

Attorney General 

Honorable Oscar II. Mauxy, Chairman Opinion No. MW-302 

Senate Education Committee 

Texas Senate, State Capitol Re: Issue of new tuition revenue 

Austin, Texas 78711 bonds under chapter 55 of the 

Education Code 

Dear Senator Mauxy: 

You have asked whether universities authorized to issue tuition 

revenue bonds up to certain maximum amounts under the provisions of 

sections 55.17, 55.171 and 55.172 of the Education Code can issue new bonds 

as they retire the original debt, so long as the statutory maximum amount is 

not exceeded. 

Section 55.17(e)(2) authorizes the board of regents of Texas Tech 

University to issue tuition revenue bonds in an amount “not to exceed $35 

million” for the purpose of providing facilities for the School of Medicine at 

Lubbock. The University of Texas System, the Texas A & M System, the 

University of Houston and Pan Ameri n University may issue bonds in 

amounts limited in similar language. Educ. Code SSSS.l?(f), 55.171, 

55.172. 

The discretion inherent in the phrase “not to exceed” is a recognition 

that a lesser amount may suffice but in no event can a greater amount than 

the stated amount be used. Train v. City of New York, 420 U.S. 35 (1975); 

Zurich General Accident & Liability Insurance Co. v. Thomas, 187 S.W. 2d 

689 (Tex. Civ. ADD. - 1945. no writ). As we understand vour ouerv. the 

unive.rsities wish io continue to issue new debt up to the r&pe&ve &llng 

amounts as old debt is retired. 

A perusal of certain constitutional provisions containing authorization 

for bonded Indebtedness in identical language is instructive. Article III, 

section 49-b of the Texas Constitution authorizes bonds to purchase land for 

resale to Texas veterans. When an increase ln the dollar amount was 

needed, the provision was amended to provide for higher dollar amounts. 

The Veterans’ Land Board did not issue new bonds as old bonds were retired. 

‘Similarly, article III, section 49-d-l increased the dollar amount authorized 

for the Texas Water Development Board by article III, section 49-c. Article 

III, section Sob-1 increased the dollar amount authorized for bond-financed 

student loans by article III, section 50b. In each case, the authorizing 

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Honorable Oscar H. Mauxy - Page Two (MW-302) 

language is identical to that contained in sections 55.17, 55.171 and 55.172 of the 

Education Code. In each case, a constitutional amendment was required when 

additional funds were needed. 

Legislative history also supports our view that the universities may not issue new 

debt up to the ceiling amounts as old debt is retired. The original version of section 

55.17 had no dollar ceilingsl the final version did.~ While records of floor debate were 

not kept for the 62nd Legislature, which passed section 55.17, there are records of 

floor debate for the 63rd Legislature, which passed sections 55.171 and 55.172. These 

records indicate that the amounts authorized were an aggregate amount and that 

additional amounts would call for new legislation. 

It is our opinion that additional legislation is required before the universities may 

issue further tuition, revenue bonds once the schools have reached their present 

statutory limits, and that there is no authority for issuing new bonds as outstanding 

debt is retired under the existing provisions. 

SUMMARY 

Universities authorized to issue tuition revenue bonds under 

sections 55.17, 55.171 and 55.172 may not issue additional bonds 

as outstanding bonds are retired. 

JOHN W. FAINTER, JR. 

First Assistant Attorney General 

RICHARD E. GRAY III 

Executive Assistant Attorney General 

Prepared by Susan’Lee Voss 

Assistant Attorney General 

APPROVED: 

OPINION COMMITTEE 

Susan L. Garrison, Chairman 

Jon Bible 

Rick Gilpln 

Robert T. Lewis 

Ladd Pattillo 

Susan Lee Voss 

Bruce Youngblood 

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