E ~RNEY GENERAL 

OF EXAS 

Mr. Joe D. Carter 

Ex~ecutive Secretary 

Opinion No. WW-618 

Texas Water Development Board Re: Authority of Texas 

Austin 1, Texas Water Development 

Board to loan money 

to the Lower Nueces 

River Water Supply 

Dear Mr. Carter: District. 

You have requested an opinion of tbe Attorney General 

relative the authority of the Texas Water Development Board to 

loan $3,000,000.00 to the Lower Nueces River Water Supply District, hereinafter called "District". 

Presently the District is constructing the Seale Dam 

and Reservoir on the Nueces River, some 36 miles Northwest of 

Corpus Christi, for the purpose of supplying that city and the 

surrounding area with water for municipal, industrial and irrigation use. The initial cost estimate on this project was 

$15,500,000,00. 

The estimated cost to completion is now $21,219,173.03. 

The difference represents increased construction cost occasioned 

by delay and increased land costs due to the discovery of four 

oil fields in the proposed reservoir basin. 

Your question follows: 

"In view of the fact that approximately 

$18,000,000 had been expended prior to the 

filing of the Notice of Intention without 

any participation by the Texas Water Development Board in the financing thereof, 

can the Texas Water Development Board now 

lawfully lend all of the funds necessary 

to completion of the project so long as 
--. 

Mr. Joe D. Carter, page 2 (WW-618) 

such sum does not exceed one-third of the 

overall total project cost or $S,OOO,OOO, 

whichever is the lesser?" 

We believe so, for you advise that the District seeks 

the loan to acquire land in the reservoir basin, and that - 

"These reservoir lands are an integral part 

of the project and absolutely necessary for 

the storage of water and the consequent operation of the entirc project. Without such 

lands, the project can not properly function 

and could not be considered complete." 

The District was created by Acts 1949, 51st Legislature, Ch. 159, p. 326 (Art. 8280-134) V.C.S., under and pursuant to the provisions of Section 59, Article XVI, Constitution of Texas. It has been judicially determined that the 

District is a legally constituted political subdivision with 

the power to acquire lands for dam and reservoir purposes by 

condemnation or otherwise. Lower Wueces River Supply District 

v. Cartwright, 274 S.W.Zd 199 (Civ.App. 1954 ref. n.r.e.). 

Section 49-c, of Article III, Constitution of Texas, 

created the Texas Water Development Board and sets up the Texas 

Water Development Fund and declares that the Fund shall be used 

for furtherance of the conservation and development of the 

State's water resources by, among others, 

"the acquisition &g- reservoirs and other 

storage projects . . .n 

and directs that - 

*Such fund shall be used only for the purpose of aiding or making funds available 

upon such terms and conditions as the Legislature may prescribe, to the various 

political subdivisions or bodies politic 

and corporate . . .* 
Mr. Joe D. Carter, page 3 (WW-618) 

In Article 8280-9, V.C.S., the Legislature has prescribed the terms and conditions for access to the Fund. Section 11 thereof reads, in part: 

11 

. . . the Texas Water Development Fund 

shall be used by the Board hereof for the 

purpose of providing financial assistance 

and aid to the various political subdivisions . . D in the conservation and development of the water resources of the 

State of Texas by the construction, acquisition or improvement of projects, as 

defined in Section 2 hereof." 

Section 2, sub-section (f): 

" "Project' means any engineering undertaking or work for the purpose of tbe conservation and development of the surface 

water resources of the State of Texas, 

including the control, storing and preservation of its storm and flood waters and 

the waters of its rivers and streams for 

all useful and lawful purposes by the acquisition, improvement, extension or construction of dams, reservoirs and other 

water storage projects . . On 

It is apparent that the Seale Dam and Reservoir is a 

project within the legislative definition, and, further, that 

the acquisition of reservoir lands is a basic, fundamental 

and inseparable part of tbat certain undertaking, and, consequently, could not be deemed a separate work containing within 

itself all the necessary elements of a water conservation project. 

The constitutional and statutory provisions do not 

expressly specify that in order to qualify thereunder for 

financial assistance a project must either be or not be in a 

particular state of initiation, progression or completion, nor 

is any implied therein applicable to this fact situation. 
Hr. Joe D. Carter, page 4 (WW-618) 

Section 15 of Article 8280-9, V.C.S., imposes a 

restriction upon the Board and the Fund: 

"The Board shall never.purchase bonds or 

other securities of a political subdivision in excess of one-third (l/3) of the 

total costs of a project for which assistance from the Fund is sought nor in excess of Five Million Dollars ($5,000,000), 

whichever is the lesser for any one (1) 

project." 

Consequently, you are advised that it is the opinion 

of the Attorney General that the Texas Water Development Board 

may lend all the funds necessary to the completion of the Seale 

Dam and Reservoir by the acquisition of reservoir lands provided the total of such aid does not exceed the limits announced 

in Section 15 of Article 8280-9, V.C.S., and the Board and the 

District comply with all other conditions precedent to the grant 

and the receipt of such financial assistance. 

SDMMARY 

The Texas Water Development Board may lend 

all the funds necessary to the completion of 

the Seale Dam and Reservoir by the acquisition of reservoir lands provided the total 

of such aid does not exceed the limits announced in Section 15 of Article 8280-9, 

V.C.S., and the Board and the District comply with all other conditions precedent to 

the grant and the receipt of such financial 

assistance. 

Very truly yours, 

WILL WILSON / 

GW-S Ass s ant 

fl 
. . - 

Mr. Joe D. Carter, page 5 (WW-618) 

APPROVBD: 

OPINION COMMITTEE 

Geo. P. Blackburn, Chairman 

Kenneth H. Burns 

Ralph Rash 

Jot Hodges, Jr. 

John Reeves 

REVImD F'ORTHEATTORNJSY GENERAL 

By: W. V. Geppert