HEA~JTORNEY GENERAL 

OFTEXAS 

GROVER SRDDRRS 

A=rrORNncY GENEHAI. 

Honorable John R. Shook 

Criminal District Attorney 

Bexar County 

San Antonio, Texas 

Dear Sir: Opinion NO. O-7054 

Re: Authorltg of county to issue 

time warrants for maintenance 

and operating expenses of county 

hospital. 

We have your letter of July 6, 1946, in which you 

request an opinion from this department on the following 

question in behalf of the Bexar County Commissioners' Court: 

"AZ to whether or not said Court is empowered 

under.the law to authorize the issuance of General Fund 

Time Warrants for the purpose of maintaining and operating the Robert B. Green Memorial Hospital, San Antonio, 

Texas." 

Attached to your opinion request is a letter from 

the County Judge of Bexar County, setting forth the background 

of this reouezt, and from which letter we quote in part as 

followz: - - 

"The (hospital) appropriation as made in the 1946 

Bexar County budget will practically be exhausted In its 

entirety not later than September 15th next. Unless it 

will be possible for the Commissioners' Court to provide 

funds by and through the issuance of General Fund Time 

Warrants for its continued operation and maintenance 

after said date to December 31zt, the end of the fiscal 

year, the Board of Managers of said Hospital will be 

faced with no alternative other than to close this 

institution." 

In answering your question, we will consider first 

the general power of a county to issue time warrants. 

Prior to 1903 there was no provision in our statutes 

for the issuance of bonds, and the courts held that counties 

had the implied authority to issue time warrants for the construction of permanent improvements. Stratton v. Commissioners' 
Honorable John R. Shook, page 2 O-7054 

Court of Kinney County, 137 S.W. 1170; Cowan et al v. Dupree 

et al, 139 S.W. 887; Commissioners' Court of Floyd County et 

al v. Nichols et al, 

151 S.W. 348. 

142 S.W. 37; Allen v. Abernathy et al, 

Some time after these decisions the Legislature 

authorized the issuance of bonds for courthouses, jails, 

public roads, etc. 

Later, in the case of Lazater v. Lopez, 217 S.W. 

373, the Supreme Court held that it was within the discretion 

of the Commissioners' Court whether they issued time warrants 

or bonds for the construction of permanent improvements. In 

this opinion Judge Phillips deals at length with the constitutional and legislative enactments which gave the commizzioners' courts authority to issue both warrants and bonds. 

In the more recent case of Adams v. McGill, 146 S.W. 

(2d) 332, in which this department intervened, the court held 

that under .a statute authorizing a county to provide for annual exhibitions of horticultural and agricultural products, 

the county had the implied power to issue time warrants payable over a period of years for improvements to livestock and 

agricultural buildings. 

The general rule, as stated in Adams v. McGill 

(supra), that the county may issue time~warrantz in payment 

for improvements which it is expressly authorized to construct, is, we believe, extended by the Su reme Court in the 

case of Bexar County v. Mann, 157 S.W. (2d P 134, to authorize 

the issuance of time warrants In payment for debts created by 

a county in accomplishment of any object for which it is 

authorized by law to expend money. 

In the Bexar County case (supra) the county had entered into a contract to purchase voting machines and had lzsued bonds therefor chargeable against the general~fund, pursuant to Art. 2997a, V.A.C.S., which authorized such purchase 

and such bonds but which statute did not expressly provide 

that such bonds were to be charged against the county general 

fund. This department, the respondent in that case, contended that the constitutional twenty-five-cent general fund tax 

should be applied only to the payment of the ordinary or current operating expense of a county and that such expense does 

not embrace or contemplate the payment of bonds or time warrants and the interest thereon, being confined to the payment 

of officers' salaries , purchasing of supplies, caring for 

paupers and providing for the actual and necessary day-to-day 

expenses. We contended that if a county can appropriate part 

of this tax for a series of future years, it can pledge all 

of it and thus deprive itself of the revenues to pay current 
Honorable John R. Shook, page 3 O-7054 

operating expenses, and that pledging the current Income for 

the payment of bonds or warrants and interest theron beyond 

the current year would be subversive of the structure of the 

county government itself. Judge Critz overruled our conten-. 

tion in that case, holding: 

"In our opinion, our decisions have already settled 

it as the law of this State that the general fund tax of 

twenty-five cents, authorized to be levied by counties 

for 'county purposes' by Section 9 of Article VIII of our 

Constitution, can be pledged for the payment of obligations or bonds, the maturities of which extend beyond the 

current fiscal year for which said tax was levied. It 

follows that the statute under consideration here, which 

authorizes bonds to be issued payable over a series of 

years out of a county's general fund tax, does not violate 

the above constitutional provision. Cazz County v. Wilbarger County,, 25 Tex. Civ. App. 52, 60 S.W. 988, writ 

refused; Hidalgo County v. Haney, Tex. Civ. App., 67 S.W. 

(2a) 409. 

II 

. . . The only question here involved is the power 

of the commissioners' court to charge the twenty-five cents 

tax authorized by Section 9 of Article VIII of our Conztltution with obligations payable beyond the current year 

for which such ,tax is levied; and as to that power no 

difference can exist between warrants and bonds running 

beyond the current year. The only material difference 

between warrants and bonds is that warrants are not negotiable, while bonds are. 

"In Hidalgo County v. Haney, zupra, the San Antonio 

Court of Civil Appeals had before it for decision the 

validity of $30,000 in county warrants payable out of the 

twenty-five cents general fund of the county, running over 

a number of gears, issued by Hldalgo County for tick 

eradication purposes by authority of Section 5 of H.B. 

;0,,~77, Ch. 53, Gen. Laws, 41st Leg. 1929, 1st called 

p. 128, 

Code;'lg36. 

Article 1525o, Section 5, Vernon's Penal 

We shall not attempt a full discussion of 

this opinion. It is sufficient to zag that it upholds 

the power of the Legislature to provide for the issuance 

of the warrants just described. 

(I . . . When we approach this case as an original 

queztlon, we are una'ble to find any words in the constitutional provizion involved which limit the power of a 

county to levy taxes thereunder for the current year only. 

The constitutional provision Itself simply llmitz the 

power to 'county purposes'. 
Honorable John R. Shook, page 4 O-7054 

Nothing is said about the current year, and certainly the 

declzionz of this State have declined to read that provision 

into it. The only provision in our Constitution which limits 

the power to levy the twenty-five cents tax authorized by 

the constitutional provision under discussion for debts payable beyond the current year, is Section 7 of Article XI, 

which provides: 'But no debt for any purpose shall ever be 

incurred in any manner by any. . . . county unless provision 

IS made, at the time of creating the same, for levying and 

collecting a sufficient tax to pa the interest thereon and 

provide at least two per cent (2% Y as a sinking fund.' This 

last-mentioned constitutional provision has been complied 

with in the order authorizing the issuance of these bonds." 

We believe it is therefore established by the above decision that a county has the authority not only to 

issue time warrants for permanent improvements but also to 

pledge ltz general fund for the issuance of time warrants to 

pay for any pmllc purpose of the county authorized by law, 

provided such expenditure does not come or fall under any 

purpose for which a special fund has been provided, such as 

permanent improvements.' 

In 1913 the Legislature of Texas authorized the 

establishment of county hospitals and provided for the election for the issuance of bonds for the cost of the erection 

of same, and provided for their operation and maintenance 

from general fund taxes. This act has been brought forward 

in Vernon's Annotated Civil Statutes as Articles 4478 to 4495 

and Article 4437a. 

In the case of Seydler et al v. Border et al, 150 

S.W. (2d 72, the Galveston Court of Civil Appeals held that 

Article 478 was constitutional and that the same authorized 

counties to issue bonds for the construction and equipment 

of county hospitals. The court also held that the issuance 

of bonds for the construction and maintenance of hospitals by 

county units for the care of the sick constituted "public 

purpose" as distinguished from a private purpose. 

It is our understanding that the Robert B. Green 

Hospital Is a county hospital and has been duly and legally 

established under the authority of Articles 4478 to 4495, 

V.A.C.S. 

Accordingly, we answer your question in the affirmative, holding that the Commissioners' Court of Bexar County 

has, subject to the express restrictions imposed by the 

Constitution and General Laws, power to issue time warrants 

for the payment of expenses Incurred in the operation and 
- -.-. 

, 

Honorable John R. Shook, page 5 Q-7054 

maintenance of the county hospital, the same being 'a county 

public purpose", pledging therefore its general fund, provided 

that the applicable regulations relating to the issuance of 

such warrants are strictly observed. 

We do not believe that our previous opinion No. 

O-6819, to which you refer in your letter, attempts to answer 

the specU'ic question raised herein, but if any part of such 

previous opinion 1s Inconsistent with the above answer, than 

such part of opinion No. O-6819 Is expressly overruled. 

In your letter from which we quote as follows, you 

make a further request: 

"Ii ow , in the event you hold that time warrants may 

be Issued under the circumstances set out In Judge Anderson's letter, then will you answer for us the following 

questions: 

"1 . Can such time warrants be issued after a budget 

has been formulated and approved by the Commissioners' 

Court, In which said budget the Robert B. Green Hospital 

and the Tuberculosis Control Board had had budgeted for 

their use the sum of 194 on the $100 valuation when the 

maximum amount provided for such Institutions by the 

Hospital Law is 20# on the $100 valuation? 

"2 . Can such time warrants be Issued when the issuance of same, the expenditure of such money, Fncreases 

the total amount of the budget for the year 1946 by the 

sum sought to be issued? 

“3 . Can the budget at this time be amended so as 

to provide additional funds for the Robert B. Green Hospital when such amendment would increase the amount spent 

during the calendar year 1946 in an amount of $75,000 

over and above the amount of cash on hand at the beginning 

of the year, and the anticipated revenues for the current 

year, as set up in the 1946 budget? 

'Because of the urgent nature of Judge Anderson's 

letter, we would appreciate your expediting the delivery 

of your opln%on as much as possible." 

Your first two questions apparently assume that the 

1946 budget controls the issuance of time warrants; in other 

words, that the 1946 budget must have made provision for the 

issuance In 1946 of time warrants In order for such warrants 

to be valid. 
Honorable John R. Shook, page 6 O-7054 

c 

We believe the correct view is that the budget is 

prepared and adopted as a basis for levy for taxes and in 

contemplation of expendrtures for a particular fiscal year, 

such expenditures being based on such taxes. Thus any expenditure of funds pursuant to such budget would involve 

only...those obligations to be paid during the particular 

', fiscal year covered by such budget, and such expenditure 

woulCr be classified as a current expenditure. 

The issuance of time warrants is one of the methods 

authorized for the payment of-a debt against a county, and 

the term "debt" refers to obligations to be satisfied out of 

future revenuesderived from tax levies, as distinct from 

obligations to be satisfied out of current revenues. 

In view of the fact that the budget contemplates 

only"expenditures out of current revenues for the current 

fiscal year, and since time warrants when issued constitute 

a debt, and therefore involve only future levies to be aerived from taxation, then the matter of the issuance of time 

warrants during a current fiscal year would have no relation 

to the current year's budget. Of course, adequate provision 

must be made in the budget for future years, and a tax levy 

for the purpose of providing funds for the payment of such 

debt service must be made. 

Your third question is answered in the negative. 

Certainly the budget cannot provide for the expenditure of 

more funds than exist in the amount of cash on hand at the 

beginning of the year plus the anticipated revenues for the 

current year. It is to be noted, however, that the issuance 

of time warrants In 1946 will not operate to amend the 1946 

budget, as pointed out in our above answer to your first two 

questions. 

Trusting that we have fully answered all your 

questions we are 

WNB:fb:wc 

APPROVED AUG 12, 1946 

s/Carlos C. Ashley 

*FIRST ASSISTANT 

ATTORNEY GENERAL 

Very truly yours 

ATTORNEY GENERAL OF TEXAS 

By s/W. N. Blanton 

W . N . Blanton' iz! 

Assiitant 

Approved Opinion Committee By s/BWB Chairman