# 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 55.17,55.171and 55.172of the Education Code can issue new bonds as they retire the original debt, solong asthe 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 ofproviding facilities for the School ofMedicine at Lubbock. The University of Texas System, the Texas A &MSystem, 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” isarecognition that a lesser amount may suffice but in no event can agreater 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, 187S.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 asold debt isretired. Aperusal of certain constitutional provisions containing authorization for bonded Indebtedness in identical language is instructive. Article III, section 49-b ofthe Texas Constitution authorizes bondsto 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 oldbonds were retired.

‘Similarly, article III, section 49-d-l increased the dollar amount authorized for the Texas Water Development Board byarticle III,section 49-c. Article III, section Sob-1increased the dollar amount authorized for bond-financed student loans by article III, section 50b. In each case, the authorizing

P- 964Honorable Oscar H.Mauxy - Page Two (MW-302)

language is identical to that contained in sections 55.17, 55.171and 55.172 of the Education Code. In each case, a constitutional amendment was required when additional funds were needed. Legislative history also supports ourview that the universities may not issue new debt up to the ceiling amounts as old debt is retired. The original version of section 55.17had 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 55.171and 55.172. These records indicate that the amounts authorized were an aggregate amount and that additional amounts would call for newlegislation. It is our opinion that additional legislation isrequired 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 isretired under the existing provisions. SUMMARY Universities authorized to issue tuition revenue bonds under sections 55.17,55.171and 55.172may not issue additional bonds as outstanding bonds are retired.

JOHN W.FAINTER, JR. First Assistant Attorney General RICHARD E.GRAYIII Executive Assistant Attorney General Prepared bySusan’Lee Voss Assistant Attorney General APPROVED: OPINIONCOMMITTEE Susan L.Garrison, Chairman Jon Bible Rick Gilpln Robert T.Lewis LaddPattillo SusanLeeVoss Bruce Youngblood

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