- c

THEA'FI'ORNEY GENERAL

Mr. Moore Lynn County Auditor Dallas County Records Wilding Dallas, Texas

Dear Mr. Lynn: July 20, 1960

OpinionNo. WW-886

Re: Does Senate Bill 178, Acts 56th Legislature,Regular Session,1959,require that the Dallas County Hospital Districtbe included in the annual independentaudit along with the records and books of Dallas County and related questions.

Your letter of recent date requests the opinion of this office on two questions:

"1

. Does Senate Bill 178, 56th Legislature, Regular Session, require that the Dallas County Hospital Districtbe included in the annual independentaudit along with the records and books of Dallas County?"
Under date of January 15, 1960, an agreementwas made between the County of Dallas, Texas, and Haskins & Sells, Certified Public Accountants, to makea general audit of the financial records and accounts of Dallas County.
"2. Is an audit of the Hospital Dlstrlct coveredby the contractbetween Dallas County and Haskins & Sells?"
Section 1 of SenateBill 178, Acts of the 56th Le islature, Regular Session 1959, (codifiedas Article 16 l-d, I & Vernon's Civil Statutes provides as follows:

"In every county In the State of Texas having a population of 350,000 Inhabitants
or more, according to the last preceding Federal Census,an annual independentaudit.. -

Mr. Moore Lynn, Page 2 (W~886)

shallbe made of all books, records, and accounts of the district, county and precinct officers, agents or employees, lneluding regular auditors of the counties and all governmentalunits of the county h~~nF~~~n~~l~"~~~t~~~t~~~~~~~~ng to the fiscal affairs of the county." (Emphasisours)
AttorneyGeneral's Opinion ~~-763 held that the word "county",as used In the preceding Article,must be treated as referring to 'countygovernment." This opinion states:

The word 'county'is used repeatediy'and consistently in the act In such a way as to mean the political unit of government rather than the geographical
area. If otherwise construed the act would require an audit of every lnstltution, public and private, In the county area.
. . .”

"It seems clear to us, however, that the Legislatureactually Intended for the Act to apply only to county government and the various units, institutionsand agencies thereof.

. . .'I(Rnphaslsours)
"Further,Sections 3 and 4 of the Act are JxXWEisLVe in this respect since they provide for the employment of the auditor by the County CommissionersCourt and furtherprovide for the auditor to be paid out of the general fund of the county. It is unlikely that the Legislature would give the duty of employing the auditor to the CommissionersCourt if the auditwere Intended to be directed at other units of

Moreover it is especially the Legislaturewould require the expenditure of county funds for the audit of some other unit of governmentwhich has Its own taxmoneys, and which would receive the benefit of such audit." (Emphasis ours)I .-

Mr. Moore Lynn, Page 3 (WW-886)

In view of this, the answer to your questionhinges upon whether or not a countyhospital district Is a unit of the County or a governmentalunit of the county hospitals.

The CommissionersCourt of any county shallhave the power to establisha countyhospital and to tax the property in the county to provide for themaintenance thereof. Article 4478,Vernon’s Civil Statutes. It is wlthout question that this type of hospital is a unit of the county. The taxmentioned above is for county purposes and cannot swell the countypurpose tax above the constltutlonal limit. AttorneyGeneral's OpinionNo. O-6636.
ArticleVIII, Section 9 of our Texas Constitution provides "but in no event shall the total of said foregoing taxes exceed eighty (80)cents on the one hundred dollars valuation, in any one year.” Many counties in Texas levy and assess themaximum tax authorizedby this Article. They are curtailed from establishinga county hospital because of the constitutional limitationson taxes.

Because of this and other reasons, therewas a need for a new and additionalgovernmentalunit with the power to levy a tax on property. With this Inmind, the people of Texas In 1954 voted upon and adopted an amendment to the Constitutionauthorizing the Legislature to provide for the creation of county hospital districts In certain counties and providing that such districts shallhave the authority to levy a tax not to exceed seventy-five ($.75) cents on the one hundred ($100.00)dollars valuation of all taxable propertywithin such district. Article IX, Section 4, Texas Constitution.

The enabling Act passed b 4494n, Vernon's Civil Statutes'(the Legislature (Article provides for the establlshment of a hospital districtwith the power to levy taxes upon the approval of the property taxpaying voters of the county. It furtherprovides the hospital district shall be managed, controlledand administeredby a Board of Hospital Managers appointedby the CommissionersCourt. Various county officialshave certain authority in regard to some functions of the district. For example, Section 2 provides that the tax so levied shallbe collected on all property subject to Hospital District taxationby the Assessor and Collector of Taxes for the county on the county tax values*- -

Mr. Moore Lynn, Page 4 (WW-886)

and in the samemanner and under the same conditionsas county taxes. However, it furtherprovides that the Assessor shall charge and deduct from payments to the District fees for collecting the tax not to exceed one and one-half (14%)per cent of the total amounts collected. Also, Section 6 states that the CommissionersCourt of the countyhas the power to prescribe themethod and
manner ofmaking purchases and expendituresby and for such Hospital District and also shallbe authorized to prescribeall accounting and controlprocedures. But the Hospital Districtmust pay all salariesand expenses necessarily Incurredby the county or any of its officers and agents In performing any dutieswhich may be prescrlbed or required and it shallbe the duty of any officer, employee or agent of such county to perform and carry out any function or serviceprescribedby the Commissioners Court.

We believe this reveals the true Intent of the Legislature. If a CountyHospital District Is a unit of the county,why thenmust it pay the county for services renderedby county officials? If it were a county unit, these serviceswould be an official duty of the officer for which no extra compensationwould be due the officer or the county.

It may be argued, however, that because county officershave certain duties in regard to the Hospital District and the fact that the boundaries of such District are co-extensivewith that of the county, that It is a unit of the county. This.however. is withoutmerit In view of the recent Supreme Court decisionBexar Count Hospital District v. Crosby, 327 S.W. 2d 445.d opinionwrittentice Hickman, he referred to the Bexar CountyRospltal District as "apolitical subdivision of the State," "a corporation"and "adifferent governmentalbody" from that of the City or County,

In view of the foregoing, It is our opinion that the books, records and accounts of a countyhospital district
are not books, records and accounts of the county government. Therefore,you are accordinglyadvised that the Dallas CountyHospital District should not be included in the audit provided for by Senate Bill 178, Acts of the 56th Legislature,Regular Session, 1959.Mr. Moore Lynn, Page 5 (W-886)

Your secondquestionwill not be answered In view of the above ruling.

SUMMARY

The Dallas County Hospital District should not be included in the annual Independent audit of Dallas County as requiredby Senate Bill 178, Acts of the 56th Le islature, Regular Session, l%g.(Article 16 l-d, & Vernon's Civil Statutes.)

Yours very truly,

WILL WILSON AttorneyGeneral of Texas

JMF:hb:mm

APPROVED:

OPINION COMMI!E'EE W. V. Geppert, Chairman

Joe Allen Osborn L. P. Lollar C. Dean Davis Lawrence Hargrove

REVIEWED FOR THE ATTORNEYGENERAL

BY: Leonard Passmore