## 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:

"Youropinion Is respectfully requested upon the followingquestionswhich have arisen In connectionwith the efforts of the beneficiary schools to put Into effect Sdctlons 

### 17and lc of Article 

### 7 of the Constitution of the State of Texas. "QuestionNo. 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
"QuestionHo. 2. If question No. 1 Is answered in the affirmative, then please
answer the followlngqueetlons: .

"(a) For what other purposes may the proceeds of said tax be used?
"(b) At what times and in what amountsmay such proceeds be withdrawn by the governing boards of the respective institutionswhlkh may elect not. I

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

to issue bonds?
"QuestionNo. 3‘ Do the governing boards of the respective insiitutionshave authority to incur and pay the reasonable and necessary expenses of issuing and selling bonds authorizedby Secticns 17 and 18 of Article 7, such as prfntlng, shipping charges and attorneysl fees?
"QuestionNo. 4, Do the governing boards of the respective instltutfonshave authority to retain the proceeds of the sales of bonds authorizedunder Sections 17 and 18 of Article 7 atidto deposit same as special trust funds for the purpose of acquiring,,

constructingand initially equlpping buildings,orother permanent lmprovements at the designated Institutionsof higher learning, such deposits to be secured by the pledge of bonds or other evidences of indebtednessof the United States or bonds which are guaranteed as to both principal and interestby the United States In an amount not less than the amount so deposited?"

Section 17 of ArticleVII 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 equippingbuildings or other permanent Improvementsat the designated institutions of higher learning;landthe governing board of each of such Institutionsof hlgher'learnfng is fully authorized to pledge all or any part of said funds allotted to such Institutionsas hereinafter provided, to securebonds or notes Issued for thepurpose of acquiring, constructingand lnltlally equipping such buildings o* other permanent improvementsat said respective lnstltutlons. Such bonds or notes shall be Issued in such amounts ar,maybe determlned by th$ governingboards of said institutions

. . .. ,

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

On March 

### 30, 1949, the AttTrney General rendered OpinionNo. v-798 to HonorableWilliam L. Kerr, President of the Board ofReg nts of the State TeachersColleges. In speaking of section 

### 17 of ArticleVII, it was held In that opln:on as 

### follows:

"ThisConstitutionalAmendment 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 principaland Interestrequlrementa **of** bonds or notes issuedunder Section 

### 17."

The above-quotedholding answersyour first question and renders unnecessary an answer to your second question.

You ask in your third questionwhether the 

### governingboardsof the respective lnstitutidns'.have the authority to incur and pay the reasonable and necessary expenses of lssulng and selling bonds authorizedby Sections 

### 17 and 18,~suchaa printing, shipping charges, and attorneys' feee.

It Is a well-established prlnolple of law 

### thatthegrantofan express power to do a cert^-.n act carrieswith It the Impliedpowers r--cesei.ry to perform such act. In order to Isa&e the bonds au

### thorizedIn Sections 

### 17and 

### 18, it would be necessary to Incur certain expenses such aa printing and aMorneys' fees. We think It clear that the respective governing boardsmay properly Incur such expenses, and pay for them out of legally available funds of the Institution,assuming, of course, that such exP

### ensesare 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 shouldbe approved by theAttorney General. If these. provisions contemplated the preparation of the transcript of proceedings and the bond8 **by** the Attorney General, then heHon. D. K. Woodward, Jr. - Page 4 (V-799)

would be put In the anomalousposltlon of preparing the bonds and then approvlnghis ownwork. It Is evident from the requirement of a;Qroval of the bonds by theAttorney General that these Constltutlonalprovfslons contemplatedthat the governing boards of the respective Institutionswould have attorneys of their own employ to prepare the necessaryproceedings. Your third queE:lon Is, therefore, answered In the affirmative.

Your fourth question Is whether the governing boards qf the respective Institutionshave the authority to retain the bond proceedsand 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 Indebtednessof the United States, or bondswhich are guaranteed as to both prfnclpal and Interestby the United States In
an amount not less than the amount so depos:t.ed.

In each Section 

### 17and 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 governingboards,
as outlined therein, and the proaecda of the sale turned over to such governingboards to carry out the bond purposes. We do not think that the amendments, either expresslyor by lmpllcation,contemplate that the proceedswould bs turned over to any other State office or officer. Only the reepectlve govern!,-* boards are the agencies chargedwith 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 Institutionmight cover severalyears. Yet, In order to take advantage of an attractive market, the governingboardsmay determine to Issue bonds at one time In an amountwhich will be sufflclent to defray the entire cost of such building program/ Such action,we think, Is clearly authorizedby the Conitltutlonalamendment&,and that the respectivegoverningboards are the agencies to retain the bond proceeds. Your fourthquestion, therefore, Is answered In the affirmative.Hon. D. R. Woodward, Jr. - Page 5 (V-799)

The proceeds of the Five 

### (5+!Cents tax leviedby Section 

### 17 of ArticleVII, Constitution of Texas, may not be withdrawn from the State Treasury for any purpose other than payment of principal and Interestupon bonds or notes authorized to be Issued under such constltut1onalprovlslon. OpinionNo. 

### v-798.

The governing boards of the respective educational Institutionsnamed In Sections 

### 17 and 

### 18,Constitution of Texas, have the authority to Incur and pay the reasonable and necessary expenses of,lssulng and sellingbonds authorized by said sections, such as printing, shipping charges, and attorneys' fees.

The governing boards of the respective lnetltutlonshave 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 securedby the pledge of bonds or other evidences of fndebtedness of the United States or bonds which are guaranteed as to both principal and interestby the United States In an amount not less than the amount so deposited.
Very trulyyours

ATTORNEY GENLrtAL OF TEXAS

GUS-s-mde Assistant