A NEY GENERAL 

EXAS 

Honorable Robert S. Calvert, Opinion No. C-705 

Comptroller of Public AccQUntS 

Austin, Texas Re: Whether control of the building and grounds purchased 

with Texas Employees Retirement System Trust funds is 

within the jurisdiction of 

the State Board of Control 

Dear Mr. Calvert: or the Retirement System. 

By two letters to-this office, ,one~ dated May 16, 1966, 

and the other dated May'l9, 1966, you have requested an opinion 

in regard to the aboye~mat~tgr. ,VIe quote from your letters as 

follows: 

Letter of'~Mav ~16th. 

"The Texas Employees Retirement System, out 

of Trust funds (Article 6228a R.C.S.) under the 

control of that agency has recently completed an 

office building and it is now being occupied by 

the retirement system. 

II 

. . . . 

"The management and control of the building 

and grounds necessarily,calls for the expenditure 

of funds from the State,"Treasuty.or the Trust 

funds with the State Treasurer under the control 

of the retirement system, This expense raises 

the question as to~what agency shall supervise the 

maintenance and operation of the building and 

grounds. 

"Please advise if the control of the building and grounds is under the jurisdiction of the 

State Board of Control or the Retirement System?" 

-3403- 
Hon. Robert S. CalVert. Page 2 (C-705) 

Letter of Mav 19th 

II 

. . . . 

"It was further discussed at that time, in 

anticipation of accounts for repair and improvements of the building and grounds which could 

not be considered as a part of the original cost 

to submit to you the question now in your office. 

The information needed by me is to determine what 

approval should be required for passing for payment bills covering the type in question: Employees 

Retirements System, Board. of Control or both?" 

Article 622Sa;Section 2, Vernon's Civil Statutes, 

as amended, provides, fin part. as follows: 

"A. The Employees Retirement System of 

Texas heretofore, established under the laws of 

this State is hereby eontinued in corporate existence . . . and the management and operation of 

said system from the effective date of this Act 

shall be governed by the provisions of this Act. 

"B. Said system shall continue to be known 

as the Employees Retirement System of Texas, and 

by such name all of its business shall be transacted, all of its funds invested, and all its cash. 

securities and other properties shall be held. 

81 . . . . 

"D. The Retirement System shall have the 

powers and privileges of a corporation and shall 

have also the powers,, privileges and immunities 

hereinafter conferred.-"~ 

Section 6 of Article 6228a. provides in part that: 

"1. The General Administration and responsibility for the operation of the Retirement System 

and for making effective the provisions of the Act 

are hereby vested in a State Board of Trustees 

II 

. . . . 

-3404- 
Hon. Robert S. Calvert, page 3 (C-705) 

Section 7 of Article 6228a. provides that: 

"C . The Treasurer of the State of Texas 

shall be the custodian of all bonds, securities, 

and funds. All payments from said funds shall be 

made by him on warrants drawn by the State Comptroller of Public Accounts supported only upon vouchers 

signed by the Secretary of the Retirement System 

and the Chairman of the State Board of Trustees. 

A duly attested copy of a resolution of the State 

Board of Trustees designating such persons shall 

be filed with said Comptroller as his authority for 

issuing such warrants." 

Section 13 of Article 6228a provides, in part, as 

follows: 

I, 

. . . All provisions of the law inconsistent 

with the provisions of this Act are hereby repealed 

to the extent of such inconsistency . . . ." 

The land and building in question were purchased pursuant to Senate Concurrent Resolution No. 17, Acts 59th Legislature, Regular Session 1965, page 1978, which contained, in 

part, the following: 

"WHEREAS, The Board of Trustees of the Bmployees Retirement System of Texas has requested 

Legislative advice concerning the acquisition of 

suitable real property and the construction of an 

office building for the System: and 

II . . . . 

"WHEREAS, Under the provisions of the Retirement Act, funds are available to acquire 

both the land and the building contemplated by 

the Board of Trustees of the Employees Retirement System . . .: and 

"WBEREAS, It will not require any additional 

legislation other than this resolution for the 

Board of Trustees to acquire such land and con- 

-3405- 
Hon. Robert S. Calvert, page 4 (C-705) 

struct a building for the Employees Retirement 

System to be paid from the Expense Fund: now 

therefore, be it 

"RESOLVED, By the Senate of the State of 

Texas, the House of Representatives concurring, 

that the Board of Trustees of the Employees Retirement System of the State of Texas be authorized 

to purchase a,suitable site and to erect thereon 

a building adequate to house the employees and 

the files of such System; 

1, I, . . . . 

It is clear from those portions of Article 6228a quoted 

above that the Retirement System is a corporate entity. Section 

2. B. of Article 6228a, quoted above, provides that all properties 

of the Retirement System shall be held in the name of the "Employees Retirement System:of~:Texas'?. 

Article 622Sa~,places the administration of the Retirement System in the hands of the Board of Trustees, and the State 

Treasurer is made custodian,,,of,all bonds, securities, and funds 

belonging to the Retirement System. The statute provides that 

all payments from Retirement System funds under the custodianship of the State Treasurer shall be made by the Treasurer on 

II . . . warrants ~drawn by the State Comptroller of Public Accounts 

supported only upon vouchers signed bv the Secretary of the 

Retirement System and the-Chairman of the State Board of Trustees." 

(Emphasis added.) 

Artiale 665, Vernon's Civil Statutes, provides, in part, 

that: 

"The State Board of Control shall have charge 

and control of all public'buildings, grounds and 

property of the State, . . . and is charged with 

the responsibility to properly.care for and protect 

such property from damage, intrusion or improper 

usage . . . . And the Board shall be authorized to 

provide for the allocation,of space in any of the 

public buildings to the departments of the State 

Government and for thg'yses authorized by law to 

: ;3406- 

,, 
. . 

Hon. Robert S. Calvert, page 5 (C-705) 

have and occupy space in the State buildings, and 

shall be authorized to make any repairs to any such 

buildings or parts thereof necessary to the serviceable accomodation of the uses to which such buildings or space therein may be allotted." 

If the building and grounds in question were held to 

be under the control of the Board of Control pursuant to Article 

665, then by virtue of such holding, the Board of Control would 

be vested with the right to provide for the allocation of space 

in the building to the various departments of the State government. Such an allocation of space for the use by other departments of the State government would be inconsistent with the 

legislative intent as manifested in Article 6228a and Senate Concurrent Resolution No. 17, cited above, and would be in contravention of the trust nature of the property, as hereinafter discussed. 

This office held in Attorney General's Opinion WW-565 

that the funds of the Employees Retirement System are the property of a trust created for the benefit of a class of citizens 

of this State. Opinion WW-565 was based on the authority of 

Friedman v. American Surety Co. of New York, 137 Tex. 149, 151 

S.W.Zd 570 (1941) wherein the Supreme Court of Texas was concerned 

with the status of the Employees Compensation Fund and the 

necessity for specific legislative appropriation prior to the 

expenditure of certain monies belonging to the fund. In concluding that legislative appropriation was not necessary, the Court 

stated: 

4, 

. . . the fund created by the Act in its 

very inception becomes the property of a trust 

created for the benefit of a class of citizens 

of this State . . . . The taxes are levied and 

collected for such fund, and not for the State 

in its sovereign capacity." 

It necessarily follows that the building and grounds 

in question having been acquired with trust funds, are impressed 

with the trust and remain trust property, subject to the management and control of the Board of Trustees of the Texas Employees 

Retirement System and do not fall within that category of property placed under the management of the State Board of Control 

-3407- 
- . 

Hon. Robert S. Calvert, page 6 (C-705) 

by Article 665. 

SUMMARY 

Control of building and grounds purchased 

with Texas Employees Retirement System Trust 

funds is within the jurisdiction of the Board 

of Trustees of the Texas Retirement System. 

Payment of accounts for maintenance of and improvements to the building and grounds of the 

Retirement System should be made by the Treasurer 

out of the Texas Employees Retirement System 

Trust funds on warrants drawn by the State 

Comptroller supported only upon vouchers signed 

by the Secretary of the Retirement System and 

the Chairman of the State Board of Trustees. 

Yours very truly, 

WAGGONER CARR 

Attorney General 

By:-&=+ 

Lewis E. Berry, Jr. 

Assistant 

LEBjr:ra 

APPROVED: 

OPINION COMMITTEE 

W. V. Geppert, Chairman 

Paul Phy 

C. Daniel Jones, Jr. 

John Reeves 

W. 0. Shultz 

APPROVED FOR THE ATTORNEY GENERAL 

BY: T. B. Wright 

-3408-