EATTORNEY GENERAL. 

Q,F TEXAS 

PRICE DANIEL j 

ATTORNEY GENERAL 

AcwrrIN 11. -n3mL4s 

June 24, 1949 

Hon. William L. Kerr, President 

Board of Regents 

State Teachers Colleges 

Midland, Texas Opinion No. V-848. 

Re: The legality of using funds 

available under the College 

Building Amendment to construct and equip buildings 

which will be revenue producing. 

Dear 6ir: 

We quote fre.m:Yeur request for opinier as follows: 

“You have heretofore advised our Board 

of procedural matters under the Constitutional 

Amendment Building Program. (Tex. Const. 

Art. VII, Sec. 17; A, G, Opinion Nos, V-798, V799.) We now m&e further request and impase 

upon you for addition&l opinion as to the use we 

mry melce Of the 8vdlable money, 

“‘Seven colleges are wnder the jurisdiction of our Board. The needs of the respective 

schools are varying. Far instmce, the meat 

pressing need in the greater number of our 

saheob is for class roem buildings, but as to 

one or perhaps two, the urgent need ia for’ diring halls er dormitor,ies or combination of the 

twe. As M one or perhapa 6rvm. the pressing 

need is for nmhpsiums. In other werde, as m 

some of the schools, the need is for buildings 

which would be self-sustaiming in part and the 

t~pc of building for which revenue bonds have 

been issued in the past, under the Skiles Act. 

(Ax& 26Mcc-A, V.C.S.) 

. 
HDL William L. Kerr, Page 2 (V-84g) 

“‘FOP the use of our Board in detommiaing the type of buildings to be permitted tier 

the Buildin(t Amendment, will you please &- 

vime: 

“‘May w.ar Board of Regents expend 

funds available under the BuildSag AnePslment fom : 
&km. Willhm L. Kerr, Pale 3 (V-84s) 

or note4 iseued for the purpose of’acquiring, ooaotructiag and initially equipping s o a buildings or othar permanent improvements 

at said respective institutions.” It neither describe4 n0r fines any 

other limitations as to the types ‘of building4 or 0-r permbnent 

improvements which may be wquir,ed or canrrtr.ucted. Therefore, 

the bonds or notes may be i44ued to secure fund4 f,er ,the ~acquisition, construction and the initial equiyping of any tfnt of building 

at the remp4ctive iw3Mulrioms whiob the pverning board properly 

ikema recea4rry in eur#9hg wt tke PunctiEioaa of ita eQuoatiana1 

in&it&&m, iacldizkg tAxtwo typea of buildings whick way be eorstructsd under tha Asnerisian4 of Articles 260%~ 4r 2654-1, V.C.S. 

. 

_ 

..:: ,. 

However, Article 2603~ provides Get the conartruction or ecquisition of the improvemea~ therein authoriaed shall 

be “without cost to the State of Texas,” and that any bonds issued 

thereunder “4hall not be an indebtedness of th4 6tak Qf Tenas, but 

shall be payable solely from the ,revenue4 Q be derived frem the 

operation of 4rid buildie;li4 O ‘* AAm, ir Article 2&4-f, it i4, povided that the acqui4iti0is and 00M%kpue$i@n of ttVe im@rovansmto 

provided for therein ‘“4hall bc llrlc without cost to the State of 

Texas, ad no bonds ia4ued fez 41&h iegfovemeats r&&l oonstitutc a debt of the State ef Texas in mny mann*r whatpoevor, but 

&all be a charge only rpinst those ~evanuo4 gre,%ieaAAy pledged 

for their p8yment.oa A, 0, Opimimu M~4kd-tZT3, O-1694, O-1707, 

O-()36, O-6993, by prior. ddda*r&~ns. Thrse statute4 rould 

apt preclude the i44uucs mf baa&m or note4 under Section 17 of 

Article VII. H0aever, if revenue bonds were BP are 00 be issued 

u&er Article 26a3c or Article 2C54c-1, then these statute4 would 

q@y to such reverie bWdr aid %lua USI ol t#ibb procreds. &i Other 

WM-SLS~ tbti bu~t##ag~ w+mqw-e~$s tm&# We Simwyal either by 

t&d ,&ssuance of &a*& ,a*,, M&5* u&&k @#sXWSi 1,7 af &ptic.As VII or 

,&t&4 issw8 oPs3iwMMkc bmula Mk&*r AH&tile 26&k or AWide 

&&J6c-1, bitt @k-h l?p kw*. 

‘,.., 

. ., 

It io cA.ew, tbesafwe, that tiw prwcedr from tzte 

noJc*,gr bon& ieswd uader Scetiea 17 & Ahiclc VII, Gorstituion df: Texas, o&a Lo wm~d ncitke~ to supplement fund4 0bttined 

bp, Ne ia.sqmce 08 pewsme baa&v *dim Article 2603~ o,r Article 

UHO-1, nor te p*y t&e d*netiuction o,r acqui4ition costs 0f the 

,~$@p@mvmments cevcr~ad by such revezIue bonde, nor te ply my 

#& of the intere4t *a and ppineipaA 0f ouch b0ikd4. 

We ares unabble te an4wer your second question cntrpzicplly because it involves fact considerations. Section 17 
I 

Ho& William L, Kerr, Page 4 (V-848) 

. ‘, 

provides, ae st&?d, that the mwey realiesd from the sale af the 

bonds, shall be spent: 

%ar the purpose of q2.quirhg, con,?, 

structingl, and initiPdly equipping buildings “; 

oh other permanent improvements a O .‘* 

.1, 

As staked by the Court af Civil &@erls: 

“The primary purpose of the amen& 

QleQt***r86~.* fw the pPrpeee of fiwrcing (8tr ~~ns~paction Pnd~Jequipment of buildings sad akbiir pwinament improvements , a OR 

Whit%aide v* Brvwn, 214 S.W,2d g44 (19483, 

,er;ror refused). 

The amendmrnt wits sefferred to by #at Court as it 

was ad i6 c csnrnody denominated, the 

ment, 84 

wCoLlepe 8J-j AmendThe cap@i:tm on S,J& 4 (tit amendment as prapored by 

the Lagislatawe) &&es that &he amendment provided: 

“A meehod~ of pqtmen$ for the WPstrai&h~ and eepment of buildings ax 

~rnuraot imprtwemebts a e .’ 

Coaretschq the histwy af the amendmInt it ir our 

intarpreta%on tbaa it was intended by tie Legislature and the peop&e to provide p&marfPy for the construction or acquisitian af 

building& a& the construction or acquisititin of other permraent 

improvements. There is no provision in the amendment for the 

repair @f e&sting buildings out of such funds. On the contrary, 

the amendment says dthaa &he participating colleges (except in 

case of aalamity) ‘“shall not e e O receive any other state funds fer 

the acqd&ng or constructing of btihW.gs or ether. permaaent improvemex& L/ s qyD 

It will be noted also that the ame&rne& uaas the 

word ‘%~@%Cally” in maying ‘for the purpose of acquiria#.i, ceast*ti 

buildings or other permaaent impsovalyw so rPsled further indic8tec trhrt the 

people and the Legislature coniemplwkd the canntrwtien or ACquisition of such bui%diBfls or cuber permaaent imppevemeatti a@ 

might requite “inB&& equipme&@ That pwt ot the am- 
Hon. William L. Kerr, Page 5 (V-B48) 

calling for “initial equipment" certainly docs not contemplate repairs. ““InitiJ 0qdpa0at"'ixdcata6 equipmetrt fer the fiirt t+e, 

p mr4!pdP6W U%d 6iSih Op4~4tiO~6 m8y ba paid 

for out ef Gelleg* AmePdmoet money, then the L*eIaturr is prohibited index the p6evS6ioa quoted above freti B aay ap#ropriation for such ~raS0ns during the effective life of’-i3i; amendment. So a colle#e which cakuhted that it would rsceive 6 million 

dollars under the amendment a not expend 6 million dollars 

for the construction of buildings and initially equippiv them. It 

would have to save back enough money to rep6ir and remodel its 

laboratories, clrrclare08~6 ) et cet8ta. for *a whoAa effective life 

of the amerdmont -- ha-0 it c& SW receive snf m0ney from 

the generd revewe for 6ucL. items &axing th8t period. 

The paople ud W k@slatuxe irtanded ne such 

result, They %s- *$ @he -:6M be invert& in buildiRg6 8nd similm ~-stimplP- ate at the collsges which 

were se bully YIlJd by W &tar i&e hkr war, mad which will 

be needed during the Jfec4kve lMe od the uaerdment. It called for 

capitsi investment of the meaey --not the wm 0f it fer maintenance, 

Jteratioru, and repairs. 

Ths Bmrd of Rep&r of mate TeackaT6 

CeIle~ea may *enid it6 Ce836t%tv&onrl U : 
. 

Ika. William L. Ke~a+~ Page 6 (V-648) 

u?aet lbiadiq hods (Tmx. Canst. Art, Ilr, aoc. 

1 7& ) or @ a l 0 cqG6itbaa @lg c~ishwctic+a aad iait&J. oquip#og ob a9q tygbds of building rt the inat6QIQsopL wbirb +&to Board properly deems net91-y h carrying cut the functions of its iastf4oticm. tad&g those types of buildings autb&z@d to ba constwcted under the provisions 

of &ttcPms 2603~ or 2654c-1, v,c,s. 

SW& &ads may net, however, be ekscd 

b swpphanmt f&a &%&xed by the issuance 

ef rwmaua beads u&m Article 2654c-1 or 

2603~~ 01: b par pay papi oi t&e cos+rhctism 

op1 l cq&sPWa coBbs ef the improviments cevaxed by stxch rove-, bowls, or to pay opy past 

86 tbm pPbaGip& ubd fnltotest Paquiramen*s of 

such PQVmaam box&. A 6, OpworAs V-796, 

v-799.