March 12, 1953

Hon. R. C. Lannlng Cipinlon No. S-18 Chairman State Board of Control Re: !Pwo queetionsrelating to Austin, Texas the admlniatratlon of the school~buepurchasinglaw

Dear Sir: ;zoihe State Board of Con-

.
We refer to your request for an opinion of this office which, in eubstance,states the following:

Certain questionshave arisen concerning the administration of the school bus purchasingprogram createdby Section 3 of ArticleV, Senate Bill 116, Act@ 51st Deg., R.S. 1949, ch. 334, p. 638 (Art. 634(b):V. C.S.) and Section 1 of Senate Bill 90, Act8 52nd Leg., R.S., 19% ch. 198, p. 325, creating the School Bus Revolving Fund, (Art. 2922-15, Sec. 2, V.C.S.)

Under present practiceswithin the Board of Control,requisitionsfrom local school districts for school buses are sent to the Board of Control, and then the Board of Control purchasesfrom the lowest of competitivebidders the buses desired. 'The local school must certify that it has encumbered sufficientotherwiseunencumberedfunds to pay for the buses as It requisitions them. The Board of Control always has outstandingpurchase requests for school buties in excess of the $25O,OOO.OOdeposit known
as the School Bus RevolvingFund. As the statements from the bus manufacturers come due with the Board of Control they are always paid by the collections received by the Board of Control from the local school dlstrick? when It delivers the buses to them. At no time has the School Bus RevolvingRund shown a balance lower than $200,000.00.Hon. R. C. tinting, page 2 (s-18)

You ask the followingquestions:

1. May the State Board of Control legallywrite purchase orders for school buses totalllngmore than $25O,OOO.O0 at any one time?

2. May the Board of Control legally award an annual ore semiannualcontractfor bua bodies and bus ohasais showing an estimatednumber of units only and guaranteeing no mlnlmum number?
Public officers may make only such contracts
as they'areauthorizedby law to make.' Fort Worth Calvary Club v. Sheppard, 125 Tex. 339, b3 S.W.2d 660 1935)
. Seotion 44 of Article III of the Constitution

. ~--. of Texas prohibits the Legislatureappropriating state money to any Individualunless at the very time the appropriationIs made there Is already in force some preexistingvalid law constitutingthe claim appropriation Is made to pay a legal and valid obligation against the State. By legal obligation la meant such an obligation
as would form a basis for a judgmentagainstthe State in a court of competent jurisdiction In the event the Legislatureshould permit It to be sued. Fort Worth Calvary Club v. Sheppard, supra. Public officersare limited In theirrlaht to contract to the amount of availableappropriation. Nicholsv. State, 32 S.W. 452 (Tex.Clv.App.,

1895:, error ref.); State v. Haldeman, 163 S.W. 1020 (Tex.Clv.App. 1913, error ref.); ForE Worth Calvary Club v. Sheppard,supra.

Section 2 of Article 2922*15,Vernon'sCivil Statutes,as amended by Chapter 198, Acts of the 52nd Legislature,

Regular Session, 1951, page 325, provides that schoolbuses purchased through the StateBoard of Control shall be paid for by the State Board of Control out of the School Bus RevolvingFund. Therefore,contracts for the purchase of school buses throughthe Board of Control create an obligationagainstthe State to be paid for out of the SchoolBus RevolvingFund. Fort Worth Calvary Club v. Sheppard;Nicholsv. State; State v. Haldeman, supra. It Is our opinionthat a contract creatingan obligationin excess of the amount of money available In the School Bus RevolvingFund at the time the contract is made would constitute a debt In violationof Section 49 of Article III of the Constltution of Texas. You are thereforeadvisedthat theHon. R. C. Lanning, page ,3 (s-18)

State Board of Control,does not have authorityto write purchase orders for school buses totalingmore than Is available In the School BusRevolvIng 'Fund at the time the purchase order Is made.

Concerningyour sec'ond ~queatlon,

you further ask if the Board of Control may legallyaward an annual
or semiannualcontract for bus bodies and bus chassis showing an estimatednumber of units only and guaranteeing no minimum number. Unless there Is a legal
reason for doing so a contractwill not be held invalid. Charles Scrlbner'sSons v. Marrs, 114 Tex. 11, 262 S.W. 722 (1924)

the In the case just cited our Supreme Court passed on validity of a contract similar to the contract involved in your question. The contract In that
case was made between the Texas State TextbookCommission and a publisher. The contract obligatedthe State to purchase all the text books on a particularsubject from the publisheras the local school boards should requisitionthem.

Th,e Constitutionis silent as to the length of term for wh.ich

a contractmay be made by the State. The only provisionsof the Constitution that might affect the term are those which provide that no debt may be created by or on behalf of the State, and that no appropriation

of money may be made for a longer term than two yea~rs. However, obligationsthat run current with revenues z,re

not debts within the contemplation of th@ Constitution. Charles Scribner'sSons v. Marrs, * McNeal 'v,

City of Waco, 'I';& D 89 Tex. 83, 33 S.W. 322

Payment for the bus bodies and for the bus chassis is to be made out of the SchoolBus Revolving Fund as they are purchased. The obligationof the contract is not to buy a fixed number or amount of bus bodies or bus chassis,but only so many as are requlsltioned by the schools of the State. Liability is fixed only for such amounts as are requisitioned by the schools, The number of buses, chassisand bodies purchased for any period is wholly within the control of the local authoritiesand of the Board off Control.

It is therefore the opinion of this office that the Board of Control may legallyaward an annual
or semiannualcontract for bus bodies and bus chassis showing an estimatednumber of units only and guaranteeing no mirLimum

number.Hon. R. C. Lannlng,page 4 (s-18)

SUMMARY

The State Board of Control does not have authority to write purchaseorders for school buses totalingmore than Is avallable'lnthe School Bus RevolvingFund at the time the purchaseorder Is made.

The State Board of,Controlmay legally award an annual or semiannualcontractfor bus bodies and bus chassis showingan estlmated number of unite only and guaranteeing
no minimum number.

Yours very truly,

APPROVED:

J. C. Davis, Jr. County Affairs Division JOHN BE3 SHEPPERD AttorneyGeneral

WI1118 E. Greaham Reviewer

Robert S.~

Trottl First Assistant BY P--- John Reeves Assistant

John Ben Shepperd Attorney General

JR:am