The Attorney General of Texas 

March 15, 1984 

JIM MATTOX 

Attorney General 

Supreme Court Building 

P. 0. Box 12548 

Austin, TX. 78711. 2548 

512/475-2501 

Telex 9101874-1367 

Telecopier 5121475.0266 

714 Jackson, Suite 700 

Dallas, TX. 75202-4506 

2141742-8944 

4824 Alberta Ave., Suite 160 

El Paso, TX. 79905.2793 

9151533-3484 

.fl 

JO1 Texas, Suite 700 

Houston, TX. 77002~3111 

7131223.5888 

806 Broadway. Suite 312 

Lubbock, TX. 79401-3479 

806,747.5238 

4309 N. Tenth. Suite B 

McAllen, TX. 78501.1685 

5121882-4547 

200 Main Plaza. Suite 400 

San Antonio, TX. 78205.2797 

5121226-4191 

An Equal Opportunity/ 

Affirmative Action Employw 

r 

Ms. Rita Howitz 

Executive Director 

State Pen&o" Review Board 

P. 0. Box 13498 

Austin, Texas 78711 

Dear Ms. Howitz: 

Opinion No. JM-137 

Re: Whether a hospital authority 

must register with the State 

Pension Review Board 

Chapter 12 of title 1lOB. V.T.C.S., imposes various requirements 

on "public retirement systems." Section 12.001(2) of title 1lOB 

defines such a system as: 

You have . 

a co"ti"ui"g. organized program of service 

retirement. disability retirement, or death 

benefits for officers or employees of the state z 

a political subdivision, other than a program 

providing only workers' compensation benefits, a 

program administered by the federal government, 

Of . . . . (Emphasis added). 

asked whether the Richardson Hospital Authority is a 

"political subdivision" within the meaning of this provision. 

Section 3 of article 4494r. V.T.C.S., authorizes counties to 

create county hospital authorities, and it expressly provides that 

such authorities are "political subdivision[sl of this State." On the 

other hand, section 3 of article 4437e, V.T.C.S., which authorizes 

cities to create city hospital authorities, such as the Richardson 

Hospital Authority, does not provide that such authorities are 

political subdivisions. We must determine whether the failure of this 

latter provision to so provide means that the legislature did not 

intend for city hospital authorities to be classified as political 

subdivisions, or whether the omission of the words 

subdivision of this State," 

"political 

which appear in section 3 of article 

4494r, was a mere oversight on the legislature's part. 

Bole" V. Board of Firemen, Policemen and Fire Alarm Operators' 

Trustees of San Antonio, 308 S.W.2d 904 (Tex. Civ. App. - San Antonio 

1957, writ ref'd), sets forth the criteria that are generally used in 

determining whether a" entity is a "political subdivision." There, 

the court stated: 

p. 583 
Ms. Rita Horwitz - Page 2 (m-137) 

A political subdivision contemplates: geographical 

ares and boundaries, public elections, public 

officials, taxing power and a general public 

purpose or benefit. 

Id. at 905. The second of these criteria was recently modified sub 

xentio by the Texas Supreme Court. In Guaranty Petrol= 

Corporation v. Armstrong, 609 S.W.2d 529, 531 (Tex. 1980). the court, 

distinguishing between a "political subdivision" and "a department, 

board or agency of the State," stated that 

[mlembers of the governing body of a pollti~cal 

subdivision are elected in local elections or are 

appointed by locally elected officials. (Emphasis 

added). 

County hospital authorities clearly meet at least four of these 

five criteria. They have geographical area and boundaries. V.T.C.S. 

art. 4494r, 63. Members of their boards of directors are appointed by 

the governing bodies of the counties that created them. Id. 04. Said 

members are unquestionably "public officials." Finxy, county 

hospital authorities certainly promote "a general public purpose or 

benefit." County hospital authorities do not, however, have taxing 

power; instead, they have bonding authority. Id. 97 et seq. 

Notwithstanding the fact that county hospital authorities do not 

technically meet all five of the Bole" and Guaranty "political 

subdivision" criteria, however, such authorities clearly are political 

subdivisions, because section 3 of article 4494r declares that they 

are. 

Like a county hospital authority, a city hospital authority has 

geographical area and boundaries, article 4437e. section 3, V.T.C.S., 

and a board of directors appointed by the city that created it. Id. 

64. These directors are certainly "public officials," and the 

authority promotes "a general public purpose or benefit." Like county 

hospital authorities, moreover, city hospital authorities have bonding 

rather than taxing power. Id. P7 et seq. As noted, however, city 

hospital authorities are not expressly designated as "political 

subdivisions." 

In our opinion, however, city hospital authorities should be 

deemed "political subdivisions" within the meaning of section 12.001 

of title 1lOB. Only in a very literal sense do such authorities fail 

to meet the "taxing power" criterion of Bole" and Guaranty; one could 

reasonably argue, moreover, that this criterion is technically met, 

since bonding authority could be deemed an adequate substitute for 

taxing power, at least for purposes of this criterion. Even if this 

criterion is not precisely met, however, to conclude that city 

hospital authorities are for this reason not political subdivisions 

p. 584 
, - 

Ms. Rita Horwitz - Page 3 (JM-137) 

/4 

is, in our view, to give entirely too much weight to what is at best a 

flimsy distinction. 

Even more compelling is the fact that county and city hospital 

authorities meet the Bole" and Guaranty "political subdivision" 

criteria to precisely the same extent. Given this fact and the fact 

that county and city authorities are otherwise so similar, we can 

perceive no logical reason why the legislature would have wanted to 

include the former within the ambit of the term "political 

subdivision" but exclude the latter. We do not believe it would have 

intended to subject only the former to the requirements of chapter 12 

of title 1lOB. 

Section 3 of article 4437e was enacted in 1957. Acts 1957, 55th 

Leg., ch. 472 at 1379. Section 3 of article 4494r was enacted in 

1963. Acts 1963, 58th Leg., ch. 122 at 324. One reason why only the 

latter mentions "political subdivisions" might be that when the 

legislature enacted this provision, it simply neglected to amend 

article 4437e. If section 3 of article 4437e had been enacted after 

section 3 of article 4494r, we believe the omission of any reference 

to "political subdivision" would be far more meaningful. Since the 

reverse occurred, however, we believe it is more likely that when it 

enacted article 4494r, the legislature simply was not concerned with 

article 4437e and therefore paid no attention to it. 

For the foregoing reasons, we conclude that the Richardson 

Hospital Authority is a "political subdivision" within the meaning of 

section 12.001 of title 1lOB. 

SUMMARY 

The Richardson Hospital Authority is a 

"political subdivision" within the meaning of 

section 12.001 of title llOB, V.T.C.S. 

JIM MATTOX 

Attorney General of Texas 

TOM GREEN 

First Assistant Attorney General 

DAVID R. RICHARDS 

Executive Assistant Attorney General 

p. 585 
- I 

Ha. Rita Horwitz - Page 4 (JM-137) 

Prepared by Jon Bible 

Assistant Attorney General 

APPROVED: 

OPINION COMMITTEE 

Rick Gilpin, Chairman 

Jon Bible 

Colin Carl 

Susan Garrison 

Patricia Ajnojosa 

Jim Noellinger 

Nancy Sutton 

p. 586