THE ATTORNEY GENERAL 

OF TEXk~ 

PRICE DANIEL 

March 31, 1949 

Hon. D. K. Woodward, Jr. 

Chairman, Board of Regents 

University of Texas 

Kirby Building 

Dallas 1, Texas Oplnibn X0. V-799 

Re: Use of tax levied 

by Section 17, and 

of proceeds of 

bonds Issued under 

Sections l'j,and 18, 

Artlole VII, ConDear Mr. Woodward: stltutlon of Texas. 

You request the opinion of the Attorney 

General In your letter of March 18, 1949, as follows: 

"Your opinion Is respectfully requested 

upon the following questions which have arisen In connection with the efforts of the 

beneficiary schools to put Into effect Sdctlons 17 and lc of Article 7 of the Constitution of the State of Texas. 

"Question No. 1. May the proceeds of 

the Five (5/) Cents tax,be used for any purpose other than payment of principal and 

Interest upon bonds or notes authorized to 

be issued under Section 17 of Article 77 

"Question Ho. 2. If question No. 1 Is 

answered in the affirmative, then please 

answer the followlng queetlons: 

. 

"(a) For what other purposes may 

the proceeds of said tax be 

used? 

"(b) At what times and in what 

amounts may such proceeds be 

withdrawn by the governing 

boards of the respective institutions whlkh may elect not 
. I 

Hon. D. X, Woodward, Page 2 (V-799) 

to issue bonds? 

"Question No. 3‘ Do the governing 

boards of the respective insiitutions have 

authority to incur and pay the reasonable 

and necessary expenses of issuing and selling bonds authorized by Secticns 17 and 18 

of Article 7, such as prfntlng, shipping 

charges and attorneysl fees? 

"Question No. 4, Do the governing 

boards of the respective instltutfons have 

authority to retain the proceeds of the 

sales of bonds authorized under Sections 17 

and 18 of Article 7 atid to deposit same as 

special trust funds for the purpose of acquiring,, constructing and initially equlpping buildings ,or other permanent lmprovements at the designated Institutions of 

higher learning, such deposits to be secured 

by the pledge of bonds or other evidences 

of indebtedness of the United States or bonds 

which are guaranteed as to both principal and 

interest by the United States In an amount 

not less than the amount so deposited?" 

Section 17 of Article VII provides, In 

part, as follows: 

II 

. 0 . there is hereby levied O s a 

a St+te ad valorem tax on property of fF,e 

cents (5#) e o e for the purpose of acquiring, constructing, and Initially 

equipping buildings or other permanent 

Improvements at the designated institutions of higher learning; land the governing board of each of such Institutions of 

hlgher'learnfng is fully authorized to 

pledge all or any part of said funds allotted 

to such Institutions as hereinafter provided, to secure bonds or notes Issued for 

the purpose of acquiring, constructing and 

lnltlally equipping such buildings o* other 

permanent improvements at said respective 

lnstltutlons. Such bonds or notes shall be 

Issued in such amounts ar,may be determlned 

by th$ governing boards of said institutions 

. . . 
. , 

Hon. D. K. Uoodward, Jr - “age 3 (V-799) 

On March 30, 1949, the AttTrney General 

rendered Opinion No. v-798 to Honorable William L. 

Kerr, President of the Board of Reg nts of the State 

Teachers Colleges. In speaking of section 17 of 

Article VII, it was held In that opln:on as follows: 

"This Constitutional Amendment clearly prescribes the terms and conditions rf the bonds 

and notes, and makes no other prou..slon for 

evidencing a liability against the fund except by the Issuance of bonds or notes. Hence 

It Is our conclusion that this special fund 

may not be withdrawn from the State Treasury 

except to pay principal and Interest requlrementa of bonds or notes issued under Section 

17." 

The above-quoted holding answers your first 

question and renders unnecessary an answer to your 

second question. 

You ask in your third question whether the 

governing boards of the respective lnstitutidns '.have 

the authority to incur and pay the reasonable and 

necessary expenses of lssulng and selling bonds 

authorized by Sections 17 and 18,~such aa printing, 

shipping charges, and attorneys' feee. 

It Is a well-established prlnolple of law 

that the grant of an express power to do a cert^-.n 

act carries with It the Implied powers r--cesei.ry to 

perform such act. In order to Isa&e the bonds authorized In Sections 17 and 18, it would be necessary 

to Incur certain expenses such aa printing and aMorneys' fees. We think It clear that the respective 

governing boards may properly Incur such expenses, 

and pay for them out of legally available funds of 

the Institution, assuming, of course, that such exP 

enses are reasonable. Davis v.'Clty of San Antonio 

civ. App.), 160 S.W. 1161. 

We think It clear that Sections 17 and 18 do 

not contemplate that the Attorney General should prepare the bond proceedings. In both of these ~seetlons 

it is provided that the bonds should be approved by 

the Attorney General. If these. provisions contemplated the preparation of the transcript of proceedings and the bond8 by the Attorney General, then he 
Hon. D. K. Woodward, Jr. - Page 4 (V-799) 

would be put In the anomalous posltlon of preparing 

the bonds and then approvlng his own work. It Is 

evident from the requirement of a;Qroval of the 

bonds by the Attorney General that these Constltutlonal provfslons contemplated that the governing 

boards of the respective Institutions would have 

attorneys of their own employ to prepare the necessary proceedings. Your third queE :lon Is, therefore, answered In the affirmative. 

Your fourth question Is whether the governing boards qf the respective Institutions have the 

authority to retain the bond proceeds and to deposit 

the same as special trust funds, to be used for carrying out the bond purposes9 such deposits to be secured 

by bonds or other evidences of Indebtedness of the 

United States, or bonds which are guaranteed as to 

both prfnclpal and Interest by the United States In 

an amount not less than the amount so depos:t.ed. 

In each Section 17 and Sectlon 18, It Is provlded , “!I%18 amendment shall be self-enacting.” We 

think that the amendments contemplate that bonds can 

be Issued and, sold by the respective governing boards, 

as outlined therein, and the proaecda of the sale 

turned over to such governing boards to carry out the 

bond purposes. We do not think that the amendments, 

either expressly or by lmpllcation, contemplate that 

the proceeds would bs turned over to any other State 

office or officer. Only the reepectlve govern!,-* 

boards are the agencies charged with the expend .fui*e 

of the funds to carry out the bond purnnses. 

It Is manifest that the large sums of money 

which may be realized from the aale of bonds cannot 

be expended Immediately, and that the building program of an Institution might cover several years. 

Yet, In order to take advantage of an attractive 

market, the governing boards may determine to Issue 

bonds at one time In an amount which will be sufflclent to defray the entire cost of such building 

program / Such action, we think, Is clearly authorized by the Conitltutlonal amendment&, and that the 

respective governing boards are the agencies to 

retain the bond proceeds. Your fourth question, 

therefore, Is answered In the affirmative. 
Hon. D. R. Woodward, Jr. - Page 5 (V-799) 

The proceeds of the Five (5+! Cents tax 

levied by Section 17 of Article VII, Constitution 

of Texas, may not be withdrawn from the State 

Treasury for any purpose other than payment of 

principal and Interest upon bonds or notes authorized to be Issued under such constltut1onal provlslon. Opinion No. v-798. 

The governing boards of the respective 

educational Institutions named In Sections 17 and 

18, Constitution of Texas, have the authority to 

Incur and pay the reasonable and necessary expenses of,lssulng and selling bonds authorized by 

said sections, such as printing, shipping charges, 

and attorneys' fees. 

The governing boards of the respective lnetltutlons have the authority to retain the proceeds of the sales of bonds and deposit the same 

as special trust funds to be used In carrying out 

the bond purposes, such deposits to be secured by 

the pledge of bonds or other evidences of fndebtedness of the United States or bonds which are guaranteed as to both principal and interest by the United 

States In an amount not less than the amount so deposited. 

Very truly yours 

ATTORNEY GENLrtAL OF TEXAS 

GUS-s-mde 

Assistant