X OFFICE OF THE ATTORXEY GENERAL - ST.~TE OF TEXAS 

JOHK CORNYN 

September 14,200l 

The Honorable Tim Curry 

Tarrant County Criminal District Attorney 

1025 South Jennings, Suite 300 

Fort Worth, Texas 76104 

Opinion No. JC-0407 

Re: Whether a hospital district board of managers 

may appoint its own members to the board of a 

health maintenance organization created by the 

district and whether the health maintenance 

organization’s board of directors is subject to the 

Open Meetings Act (RQ-0362-JC) 

Dear Mr. Curry: 

On behalf of the Tarrant County Hospital District (the “Hospital District” or “District”), you 

ask whether the District’s board of managers may appoint its own members to the board of a health 

maintenance organization (“HMO”) created by the District and whether the HMO’s board of 

directors is subject to the Open Meetings Act.’ 

We conclude that the District board of managers may appoint its own members to the board 

of the HMO, but that members of the board of managers who also serve on the HMO board must 

comply with chapter 17 1 of the Local Government Code whenever participating in a District vote 

or decision affecting the HMO. Furthermore, in participating in HMO matters involving the interests 

of both entities, HMO board members who are also members of the District’s board of managers 

must faithfully carry out their duty to the HMO, consulting and complying with the standards and 

requirements of the Texas Non-Profit Corporation Act. 

We also conclude that although the HMO board is not a governmental body subject to the 

Open Meetings Act, the group of District board of managers members who serve on the HMO board 

may constitute a governmental body in and of itself if the board of managers has delegated to the 

group any authority over District business or rubber-stamps the group’s recommendations regarding 

District business. In that case, meetings of the HMO board at which the board of managers members 

consider Hospital District business within that group’s control will be subject to the Open Meetings 

Act. 

‘Letter from Honorable Tim Curry, Tarrant County Criminal District Attorney, to Honorable John Comyn, 

Texas Attorney General (Mar. 2,200l) (on file with Opinion Committee) [hereinafter Request Letter]. 
The Honorable Tim Curry - Page 2 (JC-0407) 

Before addressing your questions, we briefly review the facts presented in your letter. The 

District is governed by article XI, section 4 of the Texas Constitution and chapter 281 of the Health 

and Safety Code. You inform us that the District’s board of managers has eleven members, all of 

whom are appointed by the Tar-rant County Commissioners Court,* as provided by section 28 1.02 1 

of the Health and Safety Code. See TEX. HEALTH & SAFETY CODE ANN. 5 28 1.02 1 (b) (Vernon 2001) 

(“The commissioners court of a county with a population of more than 650,000 but less than 1.18 

million in which a district is created under this chapter shall appoint a board composed of not less 

than five or more than 15 members.“). As authorized by section 281.05 15 of the Health and Safety 

Code, the District has established a health maintenance organization, MetroWest Health Plan 

(“MetroWest”), under chapter 20A of the Insurance Code. See id. 5 281.05 15 (“A district may 

establish a health maintenance organization in accordance with the Texas Health Maintenance 

Organization Act (chapter 20A, Vernon’s Texas Insurance Code) to provide or arrange for health 

care services for the residents of the district.“). 

You inform us that the District established MetroWest in 1997 as a nonprofit taxable corporation under the Texas Non-Profit Corporation Act, TEX. REV. CIV. STATS. ANN. 

arts. 1396-l .Ol - 11 .Ol (Vernon 1997 & Supp. 2001), to serve as a health-care-delivery system that 

would enable the District to participate in the State’s Medicaid STAR program. See Request Letter, 

supra note 1, at 2. The Texas Department of Insurance issued MetroWest a certificate of authority 

in 1997. See id. District funds establish the necessary reserves for MetroWest to qualify as an 

HMO. See id. Upon the dissolution of the HMO, its assets would be distributed to the District. See 

ld. 

In 1999, MetroWest amended its articles of incorporation to qualify as a tax-exempt entity 

under section 501(c)(4) of the Internal Revenue Code of 1986. See id. The District board of 

managers recently adopted a resolution recognizing MetroWest as a charitable organization under 

section 281.0565 of the Health and Safety Code, see id. at 4, which authorizes a hospital district to 

create a charitable organization “to facilitate the management of a district health care program by 

providing or arranging health care services, developing resources for health care services, or 

providing ancillary support services for the district.” TEX. HEALTH & SAFETY CODE ANN. 

4 281.0565(b) (V emon 2001). A charitable organization created by a district under this provision 

“is a unit of local government for purposes of Chapter 101, Civil Practice and Remedies Code.” Id. 

5 28 1.0565(c). 

We understand that MetroWest’s amended bylaws provide that the District is the sole 

member of MetroWest and that the MetroWest board members are elected by the District’s board 

of managers, which may also remove such members with or without cause. See Request Letter, 

supra note 1, at 3. The bylaws require meetings of the HMO board to be conducted in accordance 

with the Open Meetings Act. See id. 

MetroWest has contracted with the State of Texas to “arrange for managed health care 

services for Medicaid beneficiaries” in the District. See id. at 4. MetroWest and the Hospital 

*Request Letter, supra note 1, at 1. 
The Honorable Tim Curry - Page 3 (JC-0407) 

District have entered into a contract “whereby the District is compensated for providing MetroWest 

with administrative personnel and services, office space, equipment and supplies.” Id. In addition, 

MetroWest has an arrangement with the District to provide health-care services to enrollees and to 

provide administrative services for the District’s employee health plan. See id. 

Three former members of the District’s board of managers currently serve on the MetroWest 

board of directors. The board of managers is contemplating appointing three of its eleven members 

to the MetroWest board of directors. Telephone Conversations with Sullivan H. Bradley, Jr., 

Assistant District Attorney for Tax-rant County Hospital District (June 21-22,200l). The MetroWest 

board of directors has five members. Id. In addition, MetroWest is contemplating amending its 

articles of incorporation and bylaws to omit the requirement that the MetroWest board of directors 

conduct its meetings under the Open Meetings Act. 

In light of the foregoing facts, you ask whether the Hospital District board of managers may 

appoint some of its current members to the MetroWest board of directors and whether the 

MetroWest board of directors is subject to the Open Meetings Act. Request Letter, supra note 1, at 

4. As you point out, the provisions specifically governing the Hospital District and the HMO - 

chapter 28 1 of the Health and Safety Code, the Texas Non-Profit Corporation Act, and chapter 20A 

of the Insurance Code - do not resolve these questions. 

You express concern that Hospital District board of managers members may be precluded 

from serving on the MetroWest board of directors by article XVI, section 40 of the Texas 

Constitution, which prohibits dual office-holding, providing that “[n]o person shall hold or exercise 

at the same time, more than one civil office of emolument.” TEX. CONST. art. XVI, 5 40. As the 

members of the District’s board of managers serve without compensation, see TEX. HEALTH & 

SAFETY CODE ANN. 8 281.024 (Vernon 2001) (“A board member serves without compensation”), 

they do not to hold civil offices “of emolument” within the meaning of article XVI, section 40, see 

TEX. CONST. art. XVI, 8 40; see also Irwin v. State, I77 S.W.2d 970,973 (Tex. Crim. App. 1944) 

(an “emolument” for purposes of article XVI, section 40, is “any pecuniary profit, gain, or 

advantage”); Tex. Att’y Gen. Op. No. DM-55 (1991) (term “emolument” does not include the 

legitimate reimbursement of expenses), and that constitutional prohibition is inapplicable. 

You also express concern that Hospital District board of managers members may be 

precluded from serving on the MetroWest board of directors by the common-law doctrine of 

incompatibility, which is a more difficult question. The doctrine of common-law incompatibility 

prohibits public officers from holding offices with inconsistent public duties and precludes a 

body from appointing one of its members to another office. See generaZZy Tex. Att’y Gen. Op. No. 

JC-0225 (2000) (“The common-law doctrine of incompatibility bars one person from holding two 

offices if their duties conflict, Thomas v. Abernathy County Line Indep. Sch. Dist., 290 S.W. 152 

(Tex. Comm’n App. 1927, judgm’t adopted) . . . . It also prevents an individual with appointing 

power from appointing himself to another office or position. EhZinger v. Clark, 8 S.W.2d 666,674 

(Tex. 1928).“). Another strand of the doctrine, not relevant here, prevents a public officer from 

serving in an employment position that the public officer supervises. See id. (common-law doctrine 
The Honorable Tim Curry - Page 4 (JC-0407) 

of incompatibility bars one person from holding “an office and employment if the office has a 

supervisory role over the employment”) (citing Tex. Att’y Gen. LA-75-l 14). To the extent the 

doctrine of incompatibility prohibits a public officer from holding offices with inconsistent public 

duties or from being appointed to another office, it does not apply when one of the two positions is 

not a public office. See Tex. Att’y Gen. Op. Nos. DM- 194 (1992) (common-law rule against holding 

incompatible offices does not apply where one office is not public office); H-l 309 (1978) at 1 

(concluding that doctrine prohibiting holding of incompatible offices does not apply where one 

office is not a public office). Thus, whether the doctrine of incompatibility applies here depends 

upon whether MetroWest’s board members are public officers. 

Based on the information you have provided, it is difficult for us to assess the legal nature 

of MetroWest and the status of its board members. On the one hand, MetroWest is a legal entity 

with an identity separate and apart from the District. As we have noted, the District established 

MetroWest pursuant to section 28 1.05 15 of the Health and Safety Code, which permits a hospital 

district to establish a health maintenance organization in accordance with the Texas Health 

Maintenance Organization Act, chapter 20A of the Texas Insurance Code, “to provide or arrange 

for health care services for the residents of the district.” TEX. HEALTH & SAFETY CODE ANN. 

9 281.05 15 (Vernon 2001). Although the Hospital District is authorized by law to establish an 

HMO, MetroWest is organized as a nonprofit corporation under the Texas Non-Profit Corporation 

Act. Its purpose, as we understand it, is not to govern the Hospital District but to provide and 

arrange for health-care services, particularly to provide a system for the delivery of health-care 

services under the state Medicaid program. 

On the other hand, the HMO is so closely affiliated with the Hospital District that we hesitate 

to conclude that it is a private entity. A brief we have received suggests that HMOs formed under 

section 281.05 15 are essentially subsidiaries of the creating hospital districts: “the districts remain 

the parent company and the HMO is the equivalent of a subsidiary.” Brief of David W. Hilgers, 

Hilgers & Watkins, at 2 (May 22,200l) (on file with Opinion Committee). In this case, the Hospital 

District is the sole member of the HMO. See Request Letter, supra note 1, at 2. Furthermore, 

because the District board of managers appoints the members of the IIMO board and may remove 

them with or without cause, see id., the Hospital District exercises significant control over the HMO 

board. This control would be even more extensive if three of the HMO’s five members were also 

members of the Hospital District board of managers. As a charitable organization under section 

281.0565 of the Health and Safety Code, the HMO “is a unit of local government for purposes 

of Chapter 101, Civil Practice and Remedies Code.” TEX. HEALTH & SAFETY CODE ANN. 

8 281.0565(c) (Vernon 2001). District funds establish the necessary reserves for MetroWest to 

qualify as an HMO and MetroWest’s assets would revert to the District upon the HMO’s dissolution. 

See Request Letter, supra note 1, at 2. Given the close relationship between the Hospital District 

and the HMO and the Hospital District board of manager’s ultimate control over the HMO, it 

appears that the HMO may actually function as an alter ego of the Hospital District. 

In determining whether the doctrine of incompatibility applies to the HMOs board members, 

however, we focus on their authority and duties rather than the legal status and role of the HMO. 
The Honorable Tim Curry - Page 5 (JC-0407) 

This office recently applied the following legal standard to determine whether officers of a nonprofit 

corporation held public office: 

Public office is the right, authority, and duty created and 

conferred by law, by which, for a given period, either fixed by law, 

or enduring at the pleasure of the creating power, an individual is 

invested with some portion of the sovereign functions of the 

government, to be exercised by him for the benefit of the public. 

Tex. Att’y Gen. Op. No. JC-345 (citing Kimbrough v. Barnett, 55 S.W. 120, 122 (Tex. 1900)); see 

also Aldine Indep. Sch. Dist. v. Standley, 280 S.W.2d 578,583 (Tex. 1955) (status as an officer as 

opposed to an employee is determined by “‘whether any sovereign function of the government is 

conferred upon the individual to be exercised by him for the benefit of the public largely independent 

of the control of others”‘) (quoting Dunbar v. Brazoria County, 224 S.W.2d 738, 740 (Tex. Civ. 

App.-Galveston 1949, writ ref d)). 

Applying these criteria, we conclude that the HMO’s board members are not public officers 

because their authority and duties are not created and conferred by law. Although a statute 

authorizes hospital districts to establish HMOs, MetroWest exists not by an act of the legislature but 

rather due to the act of the Hospital District in establishing it. Moreover, the HMO board members’ 

authority and duties derive not from a statute but rather from the HMO’s articles of incorporation 

and bylaws. We have no information about the actual duties of the HMO board and whether it 

performs duties that are arguably sovereign functions of the Hospital District. In this regard, we 

caution that “[n]o governmental agency can, by contract or otherwise, suspend or surrender its 

functions, nor can it legally enter into any contract which will embarrass or control its legislative 

powers and duties or which will amount to an abdication thereof.” City of Corpus Christi v. 

Bayfront Assocs., Ltd., 814 S.W.2d 98, 107 (Tex. App.-Corpus Christi 1991, writ denied); Guerra 

v. Rodriguez, 239 S.W.2d 915 (Tex. Civ. App.-San Antonio 195 1, no writ); see also Tex. Att’y Gen. 

Op. No. JC-0335 (2001) (“Absent specific constitutional authorization, a city or county may not 

transfer control of its governmental functions to another entity.“). 

We also suggest that, in advising the Hospital District with respect to this matter, you 

consider common-law and statutory conflict-of-interest rules, which are directed at preventing public 

officials from using their authority to benefit their own or other private interests. For example, in 

Attorney General Opinion H-l 309, this office concluded that while the prohibitions against dual 

office-holding and incompatibility did not preclude a member of a state commission from serving 

on the board of a private nonprofit foundation affiliated with the public entity, common-law 

prohibitions would limit the ability of the two entities to enter into contracts: 

Public officers may not have a direct or indirect pecuniary 

interest in a contract entered into by the agency or political 

subdivision they serve. Meyers v. Walker, 276 S.W. 305 (Tex. Civ. 

App.-Eastland 1925, no writ) . . . . 
The Honorable Tim Curry - Page 6 (JC-0407) 

Closely related to the policy against public contracts in which 

one of the contracting officials has a pecuniary interest is the policy 

against dual agency. An agent may not represent the opposing party 

in a transaction without the full knowledge and consent of his 

princip[al]. Anderson v. Grzfith, 501 S.W.2d 695, 700 (Tex. Civ. 

App.-Fort Worth, writ ref d n.r.e.); Bute v. Stickney, 160 S.W.2d 302 

(Tex. Civ. App.-San Antonio 1942, writ ref d w.o.m.). Although this 

rule has developed in the context of private transactions, we believe 

it is relevant to the conduct of persons acting as agents of the state. 

Like the policy against conflict of interest in public contracts, it 

guards against competing interests of a public official which would 

‘prevent him from exercising absolute loyalty and undivided 

allegiance to the best interest’ of the governmental entity he serves. 

Tex. Att’y Gen. Op. No. H-1309 (1978) at 2. 

Significantly, these common-law rules have been largely displaced by statutes, the most 

relevant of which for our purposes is chapter 171 of the Local Government Code. Chapter 171, 

which has been construed to apply to members of a hospital district board, see Tex. Att’y Gen. Op. 

No. JC-210 (2000)’ establishes the duties of local public officials when they are faced with voting 

on a matter that will affect a business entity in which they have an interest. See TEX. LOC. GOV’T 

CODE ANN. $5 171.002, .003 (Vernon 1999). Specifically, a local public official who has a 

“substantial interest” in a business entity must disclose that interest and abstain from participating 

in a vote or decision on a matter that will have a special economic effect on the business entity. See 

id. 8 171.004. Chapter 171 expressly provides that it preempts the common-law of conflicts-ofinterest as applied to the local officials who fall within the chapter’s scope. See id. 8 171.007(a). 

In addition, section 171.009 affirmatively permits a local public official “to serve as a member of 

the board of directors ofprivate, nonprofit corporations when such officials receive no compensation 

or other remuneration from the nonprofit corporation or other nonprofit entity.” Id. 8 17 1.009. 

The MetroWest bylaws provide that directors of the HMO serve without compensation, but 

they do not “preclude any Director from serving the Corporation in any other capacity and receiving 

compensation therefor.” Request Letter, supra note 1, at 3. Thus, conceivably an HMO board 

member who is also a member of the Hospital District board of managers could receive a salary from 

the HMO as an HMO employee. 3 A member of the board of managers who serves on the HMO 

board and has a substantial interest in the HMO, see TEX. Lot. GOV’T CODE ANN. 0 171.002 

(Vernon 1999) (defining “substantial interest”), must disclose that interest and refrain from 

participating in any vote or decision of the board of managers that has a special economic effect on 

the HMO, see id. 0 171.004. As chapter 171 preempts the common-law of conflicts-of-interest, 

3This provision raises the issue whether a member of the hospital district board of managers may be employed 

by the HMO. As you do not raise this issue, we do not address it. 
The Honorable Tim Curry - Page 7 (JC-0407) 

however, members of the Hospital District board of managers who serve on the HMO board and who 

do not have a substantial interest in the HMO are permitted to participate in board of managers votes 

and decisions that affect the HMO. See Tex. Att’y Gen. Op. Nos. JM-1065 (1989) (by virtue of 

chapter 171, member of city council who serves on board of foundation but does not have a 

substantial interest in the foundation may participate in votes and decisions of the council concerning 

agreements between the city and the foundation); JM-424 (1986) at 8 (statutory predecessor to 

chapter 171 supplants common-law policy against dual agency). 

Finally, we caution that chapter 171 governs the duty of members of the Hospital District 

board of managers to the Hospital District; it does not address the duty of persons who serve on both 

the board of managers and the HMO board to MetroWest. See Tex. Att’y Gen. Op. No. DM-256 

(1993). In participating in HMO matters involving the interests of both entities, MetroWest board 

members who are also members of the board of managers must also faithfully carry out their duty 

to MetroWest, consulting and complying with the standards and requirements of the Texas NonProfit Corporation Act. See, e.g., TEX. REV. CIV. STATS. ANN. arts. 1396-2.28 (duty of director of 

nonprofit corporation to act in best interest of the corporation); 1396-2.30 (procedures applicable 

when director has an interest in a contract or transaction between corporation and another entity) 

(Vernon 1997). 

Next we consider whether the Open Meetings Act would apply to the MetroWest board of 

directors if the hospital district appoints three of its eleven members to the five-member MetroWest 

board and MetroWest amends its articles of incorporation and bylaws to omit the requirement that 

the MetroWest board conduct its meetings under the Open Meetings Act. We conclude that it may. 

The Open Meetings Act (the “Act”) applies to governmental bodies. See TEX. GOV’T CODE 

ANN. § 551.002 (Vernon 1994) (“Every. . . meeting of a governmental body shall be open to the 

public, except as provided by this chapter.“) (emphasis added). It defines the term “governmental 

body” to include the following pertinent entities at the local level: 

(B) a county commissioners court in the state; 

(C) a municipal governing body in the state; 

(D) a deliberative body that has rulemaking or quasi-judicial 

power and that is classified as a department, agency, or political 

subdivision of a county or municipality; 

(E) a school district board of trustees; 

m a county board of school trustees; 

(G) a county board of education; 

(H) the governing board of a special district created by law. 
The Honorable Tim Curry - Page 8 (JC-0407) 

Id. 8 55 l-001(3) (Vernon Supp. 2001). The definition of “governmental body” also includes certain 

nonprofit water supply corporations, see id. 8 55 1 .001(3)(I). Finally, as the result of amendments 

to the Act in the last legislative session that will become effective September 1, 2001, the term 

“governmental body” will also include a local workforce development board,4 and “a nonprofit 

corporation that is eligible to receive funds under the federal community services block grant 

program and that is authorized by this state to serve a geographic area of this state.“5 

Only entities that fall within the definition of “governmental body” are subject to the Act. 

The hospital district board of managers is a governmental body within the meaning of subsection 

(H). See Tex. Att’y Gen. Op. No. H-238 (1974) ( concluding that the governing body of the Harris 

County Hospital District was a special district subject to the Open Meetings Act); Tex. Att’y Gen. 

LO-97-O 17 (1997). This office has held on several occasions that nonprofit corporations established 

pursuant to the Texas Non-Profit Corporation Act, that assist local entities pursuant to contract, and 

that are not delegated governmental authority, are not subject to the Open Meetings Act. See, e.g., 

Tex. Att’y Gen. Op. No. JC-0327 (2001) (Bryan-College Station Economic Development Corporation not subject to the Open Meetings Act); Tex. Att’y Gen. LO-94-090 (1994) (concluding that 

Moore County Development, Inc., a nonprofit corporation organized under Texas Non-Profit 

Corporation Act, was not a special district within meaning of Open Meetings Act). Thus, assuming 

that MetroWest has not been delegated governmental authority, we do not believe that its board is 

a governmental body within the literal language of the Open Meetings Act. 

As noted above, as of September 1,200 1, the definition of “governmental body” will extend 

to a local workforce development boardy6 and “a nonprofit corporation that is eligible to receive 

funds under the federal community services block grant program and that is authorized by this state 

to serve a geographic area of this state.“7 The former amendment extends the Act to local workforce 

development boards created under the Workforce and Economic Competitiveness Act, chapter 2308 

of the Government Code. See Tex. H.B. 936’77th Leg., R.S., ch. 1004,2001 Tex. Sess. Law Serv. 

(eff. 9/O 1 /O 1); TEX. GOV’T CODE ANN. 9 2308.253 (Vernon 2000) (providing for the creation of local 

workforce development board). The HMO does not appear to be a local workforce development 

board. See id. Furthermore, the latter amendment extends the Act to nonprofit corporations that 

receive federal community services block grants authorized by the federal Community Services 

Block Grant Act, 42 U.S.C. ch. 106 (1994 & Supp. IV), and administered by the community affairs 

division of the Texas Department of Housing and Community Affairs, see, e.g., TEX. GOV’T CODE 

ANN. ch. 2306, subch. E (Vernon 2000) (community affairs division of the Texas Department of 

4Tex. H.B. 936, Act of May 24,77th Leg., R.S., ch. 1004,s 1, sec. 551.001(3)(I), 2001 Tex. Sess. Law Serv. 

(eff. 9/01/01). 

‘Tex. H.B. 371, Act o f May 17,77th Leg., R.S., ch. 633, 0 1, sec. 551.001(3)(J), 2001 Tex. Sess. Law Serv. 

(eff. 9/01/01). 

6Tex. H.B. 936, Act of May 24,77th Leg., R.S., ch. 1004,§ 1, sec. 551.001(3)(I), 2001 Tex. Sess. Law Serv. 

(eff. 9/01/01). 

‘Tex. H.B. 371, Act of May 17,77th Leg., R.S., ch. 633, $ 1, sec. 551.001(3)(J), 2001 Tex. Sess. Law Serv. 

(eff. 9/01/01). 
The Honorable Tim Curry - Page 9 (JC-0407) 

Housing and Community Affairs); 10 TEX. ADMIN. CODE 8 5.1 (2001) (Tex. Dep’t of Housing and 

Community Affairs, Community Services Block Grant) (assurances for community services block 

grant program).’ The HMO does not appear to receive federal community services block grants.9 

This not the end of our analysis, however, because although the HMO board may not be a 

“governmental body” under section 5 5 1 .OO 1, the Act will apply to meetings of the Metro West board 

of directors if the three members of the Hospital District board of managers who serve on the 

MetroWest board function as a subcommittee of the board of managers. The Act defines a 

“meeting” in part as “a deliberation between a quorum of a governmental body, or between a quorum 

of a governmental body and another person, during which public business or public policy over 

which the governmental body has supervision or control is discussed or considered.” TEX. GOV’T 

CODE ANN. 8 55 1.001(4)(A) (V emon Supp. 2000); see also id. 8 55 1 .001(2) (defining “deliberation” 

to mean “a verbal exchange during a meeting between a quorum of a governmental body, or between 

a quorum of a governmental body and another person, concerning an issue within the jurisdiction 

of the governmental body or any public business”). Generally, meetings of less than a quorum of 

a governmental body are not subject to the Act. While three members do not constitute a quorum 

of the eleven-member board of managers, see id. 8 55 l.OOl(6) (defining “quorum” as “a majority 

of a governmental body, unless defined differently by applicable law or rule or the charter of the 

governmental body”), the Act may apply to meetings of less than a quorum of a governmental body 

in certain circumstances. This office has repeatedly construed the Act to apply to subcommittees 

of less than a quorum of a governmental body if, for example, the subcommittee supervises or 

controls business of the governmental body or makes recommendations that are merely 

rubber-stamped by the governmental body. See, e.g., Tex. Att’y Gen. Op. Nos. JC-0060 (1999)’ 

JM-1072 (1989), H-772 (1976),H-238 (1974)’ H-3 (1973). 

Thus, the group of three board of managers members may constitute a governmental body 

in and of itself if the board of managers has delegated to the group any authority over Hospital 

District business or rubber-stamps the group’s recommendations regarding Hospital District 

business. See Tex. Att’y Gen. Op. Nos. JC-203 (2000), H-238 (1974) (standing committees 

composed of members of the hospital district board of managers that have been delegated authority 

to deliberate and make recommendations in a particular area of hospital district business must 

comply with the notice and accessibility provisions of the Open Meetings Act). In that case, 

meetings of the MetroWest board at which the board of managers members consider Hospital 

District business within that group’s control will be subject to the Act. 

*See Tex. H.B. 371,77th Leg., R.S., ch. 633,200l Tex. Sess. Law Serv. (amending Government Code section 

551 .OOl); Hearings on Tex. H.B. 371 Before the House Comm. on State Afiirs, 77th Leg., R.S. (Mar. 19, 2001) 

(testimony of author of House Bill 371, Rep. Bob Glaze) (audio tape available from House Video/Audio Services); 

Debate on Tex. H.B. 371 on the Floor of the House, 77th Leg., R.S. (Apr. 25,200l) (audio tape available from House 

Video/Audio Services) (“This bill only applies to those organizations that are certified by the state to serve a certain area 

and that also meet the requirements to receive funding from the community service block grant. This is administered 

by the Texas Department of Community and Housing Development.“) (statement of author of House Bill 371, Rep. 

Bob Glaze). 

Tex. Dep’t of Housing and Community Affairs list of CSBG recipients, available at 

http://www.tdhca.state.tx.us/pdf/ca/con-list.pdf. 
The Honorable Tim Curry - Page 10 (JC-0407) 

Finally, we urge the Hospital District and MetroWest to consider the policy implications of 

amending the HMO’s articles of incorporation and bylaws to remove the Open Meetings Act 

safeguard. There appears to be a distinct possibility that Hospital District business could be 

conducted by the HMO board behind closed doors. Although this will be the case regardless of the 

size of the HMO board, the opportunity for meetings of the HMO board to devolve into meetings 

of a subcommittee of the Hospital District board of managers will be heightened by the fact that 

members of the board of managers constitute a majority of the HMO’s five-member board. 

Furthermore, there is at least the appearance that the HMO is a mere alter ego of the Hospital 

District. It seems the more prudent course would be for the HMO board to comply with the Open 

Meetings Act, even if the letter of the law does not require it to do so. 

In sum, the Hospital District board of managers may appoint its own members to the board 

of the HMO but members of the Hospital District board of managers who also serve on the HMO 

board must comply with chapter 17 1 of the Local Government Code whenever participating in a vote 

or decision involving the HMO. Furthermore, in participating in HMO matters involving the 

interests of both entities, HMO board members who are also members of the board of managers must 

faithfully carry out their duty to the HMO, consulting and complying with the standards and 

requirements of the Texas Non-Profit Corporation Act. The group of Hospital District board of 

managers members who serve on the HMO board may constitute a governmental body in and of 

itself if the board of managers has delegated to the group any authority over Hospital District 

business or rubber-stamps the group’s recommendations regarding Hospital District business. In that 

case, meetings of the HMO board at which the board of managers members consider Hospital 

District business within that group’s control will be subject to the Open Meetings Act. 
The Honorable Tim Curry - Page 11 (JC-0407) 

SUMMARY 

The Tarrant County Hospital District board of managers may 

appoint its own members to the board of the health maintenance 

organization (“HMO”) established by the Hospital District, but 

members of the board of managers who also serve on the HMO board 

must comply with chapter 171 of the Local Government Code 

whenever participating in a Hospital District vote or decision 

involving the HMO. Furthertnore, in participating in HMO matters 

involving the interests of both entities, HMO board members who are 

also members of the board of managers must faithfully carry out their 

duty to the HMO, consulting and complying with the standards and 

requirements of the Texas Non-Profit Corporation Act. 

Although the HMO board is not a governmental body subject 

to the Open Meetings Act, the group of Hospital District board of 

managers members who serve on the HMO board may constitute a 

governmental body in and of itself if the board of managers has 

delegated to the group any authority over Hospital District business 

or rubber-stamps the group’s recommendations regarding Hospital 

District business. In that case, meetings of the HMO board at which 

the board of managers members consider Hospital District business 

within that group’s control will be subject to the Open Meetings Act. 

N CORNYN 

Attorney General of Texas 

HOWARD G. BALDWIN, JR. 

First Assistant Attorney General 

NANCY FULLER 

Deputy Attorney General - General Counsel 

SUSAN D. GUSKY 

Chair, Opinion Committee 

Mary R. Crouter 

Assistant Attorney General, Opinion Committee