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The Honorable Curtis Wilkinson Opinion No. H-914 County Attorney County of Lamb Re: May Lamb County I'.0. Box 946 finance aproposed revenue Littlefield, Texas 79339 bond feasibility study for the Lamb County Hospital Authority.
DearMr. Wilkinson:
You advise that in 1974 the Lamb County Commissioners Court passed an order creating the Lamb County Hospital Authority, pursuant toarticle 4494r, V.T.C.S. The appointed board of directors for theAuthority has requested that the county pay for a study todetermine if there isa financially attractive basis uponwhich hospital revenue bondsmight be sold by theAuthority to finance the erection, furnishing and operation of ahospital. Unless such a study isconducted which confirms that it is economically feasible to construct and operate ahospital in Lamb County, agood rating for the proposed bonds cannot be obtained. Such studies are statutorily sanctioned. See Hospital Broject Financing Act, V.T.C.S. art. 4437e-2, 9- 3(c)(4). The directors of theAuthority propose to repay the county from anticipated bond sale proceeds. According toyour letter, the study is expected to cost between ten thousand and forty thousand dollars. You ask:

Does theLamb County Commissioners Court have legal authority to expend public funds for a feasibility study preparatory to the Lamb County Hospital Authority issuing revenue bonds?

p. 3835The Honorable Curtis Wilkinson -page 2 (H-914)

The Lamb County Hospital-Authority is "abody politic and corporate and apolitical subdivision of the State." V.T.C.S. art. 4494r, 6 3;Thomas v. Howard County Hospital Authority, 489 S.W.2d 403 (Tex.CE. App. -- Eastland 19721, writ ref'd n.r.e., 498 S.W.2d 146 (Tex.Sup. 1973). It is an entity distinct and separate from the county. Attorney General Opinion M-260 (1968). Cf.Attorney General Opinion H-554 (1975). The statute underwhich itwas created denies it taxing power but it is empowered to raise fundsby issuing revenue bonds andmay accept donations, gifts and endowments. V.T.C.S. art. 4494r, 69 1, 7, 19. While one political subdivision may not constitutionally make agift of itspublic funds to another political subdivision or lend it its credit, Tex. Const. art. 3, 9 52, a county is not prohibited by theConstitution from expending its funds for aproper public purpose merely because the expenditure will incidentallv benefit another political subdivision. See Harris County Flood Control Dist. v. Mann, 140 S.W.2d 1098 (Tex.Sup. 1940). Cf. Barrington v. Cokinos, 338 S.W.2d 133 (Tex.Sup. 19irm. S.W.2d 195 (Tex.Civ.App. InDancy c Davidson, 183

-- SanAnton= 1944,writ ref'd), itwas held that article 5, section 18of theTexas Constitution and article 2351, section 7,V.T.C.S., authorized the Cameron County Commissioners Court tomake expenditures for the purchase of apublic building tohouse a state public health unit serving the county, aswell as other state and federal agencies serving the county. The Court stressed that the agencies and offices were'performing governmental and public functions which benefitted the entire county. The public health of the populace is,of course, a proper concern of the Lamb County Commissioners Court. Article 4418f,V.T.C.S., specifies:

The Commissioners Court of any County shall have the authority to appropriate and expend money from the general revenues of its County for and inbehalf of public health and sanitation within its County.
It seems clear that the Lamb County Commissioners Court might have expended county funds topay for a feasibility study before it created the hospital Authority. The erection, furnishing, and operation of a county public hospital isa proper public function benefiting the entire county which itmight have undertaken itself. V.T.C.S. art. 4478: art. 4418f; Se dler v. Border, 115 S.W.Zd 702 (Tex.Civ. App. 1938, nowrit

.

5- The creation of theAuthoritv did not withdraw from the commissioners court the power to respond

P. 3836The Honorable Curtis Wilkinson -page 3 (H-914)

to the public health needs of the county, [CompareTex. Const., arts. 9, 99 4, 9and 13;Attorney General Opinions C-772 ,C-646 (1966)]and under the facts presented tous, if theCommissioners Court of Lamb County determines that it is in thebest interests of the county to undertake and pay for ahospital revenue bond feasibility study, we cannot say the Texas Constitution forbids it.
The Interlocal Cooperation Act, article 4413(32c), V.T.C.S., authorizes "the fullest possible range of intergovernmental contracting authority at the local level" to improve the efficiency and effectiveness of local governments. See also V.T.C.S. art. -- 4434:Attorney General Opinion C-772 (1966). The County Hospital Authority Act, article 4494r, requires bonds issued under it to specify that holders of thebonds shall never have the right todemand payment out ofmoney raised or tobe raised by taxes, but itdoes not forbid the use of taxmoney to aid theAuthority. Itdoes not repeal article 4418f.
SUMMARY The Lamb County Commissioners Court has legal authority to expend public funds for a feasibility study preparatory to the Lamb Count? Hospital Authoritv issuing revenue bonds.- - ery truly yours,

Attorney General of

C. ROBERT HEATH. Chairman Texas

Opinion Committee jwb

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