E AYTORNEY GENERAL 

OF %kXAS 

Honorable G. C. Franklin Opinion No. M-325 

Vice-President for Business 

Affairs Re: Are the benefits of a 

Midwestern University retirement trust, esWichita Falls, Texas 76308 tablished for the benefit 

of the President of Midwestern University, to be 

regarded as salary supplementation under the terms 

of Section 24f, Article IV, 

House Bill 5, Acto of the 

60th Legislature, First 

Called Session, 1968 

(General Appropriations 

Dear Mr. Franklin: Act)? 

The text of your recent letter , requesting the opinion 

of this office on the above captioned question, is as follows: 

"Is the President of Midwestern University 

authorized to receive a $1,500 salary increase 

in the fiscal year beginning September 1, 1968, 

as provided under Sec. 24.f. of the Special Provisions Relating only to State Agencies of Higher 

Education, House Bill Number 5, as Enacted by the 

First Called Session of Sixtieth Legislature of 

the State of Texas, in view of the fact that a 

retirement trust is provided for his benefit? A 

copy of the Retirement Trust is attached for your 

review. " 

House Bill 5, Acts of the 60th Legislature, First 

Called Session, 1968, to which your inquiry is directed, contains the appropriations for the fiscal year beginning September 

1, 1968, and ending August 31, 1969. Section 24f of Article IV 

(Special Provisions Relating only to State Agencies of Higher 

Education) provides: 

'The Presidents of Tarleton State College, 

Prairie View A. and M. College, Texas A&I University, Texas Southern University, Midwestern 

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Hon. G. C. Franklin, page 2 (M-325) 

University, Pan American College, East Texas 

State University, Sam Houston State College, 

Southwest Texas State College, West Texas State 

University, Stephen F. Austin State College, 

Sul Ross State Colleae and Anaelo State Colleae 

(Emphasis added.) 

Your question is whether a retirement trust, established 

for the benefit of the President of Midwestern University, constitutes such a salary supplementation asto render the President 

of Midwestern University ineligible to receive the $1,500 appropriation provided for by the bill; The copy of the trust 

agreement attached to your letter provides, in part, as follows: 

" 1 . Midwestern University Foundation, Inc. 

(hereinafter referred to as 'FOUNDATION') a nonprofit organization, is desirous of providing 

funds to disburse to Travis A. White, President 

of Midwestern University, upon his retirement as 

an inducement for him to remain in his capacity 

as President until such time as he retires." 

(Emphasis added.) 

"2 o Foundation shall from,time to time pay 

over funds to a Retirement Trust, which funds 

shall be distributed according to the terms hereinafter set forth. 

n3. . . . 

"4. Foundation as grantor Of said Trust, 

has made a contribution to said Trust and shall 

make contributions in the future until the date 

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Hon. G. C. Franklin, page 3 (M-325) 

of retirement of Travis A. White in 

not less than $2,500.00 per annum. 

an amount 

* . . . . 

"Section 1.0: There is hereby created a 

retirement fund . . . for the exclusive benefit 

of Travis A. White, and if not to Travis A. White, 

then to the contingent beneficiaries hereinafter 

named. 

II 

. . . * 

"Section 3.0: Distribution shall be made as 

follows: 

"Section 3.01: When Travis A. White reaches 

the normal retirement date or when he retires 

voluntarily or is retired by Midwestern University 

at an earlier date, he shall be entitled to receive all corpus and undistributed income of the 

Trust. 

dies 

shall 

"Section 3.02: In the event Travis A. White 

prior to retirement date, the Trust Estate 

continue to be held IN TRUST, and the 

Trustee in its sole and absolute discretion may 

make distribution of either income or corpus to 

or for the benefit of Evalyn M. White, wife of 

Travis A. White. 

"Section 3.03: Upon the death of Evalyn M. 

White, all corpus and undistributed income shall 

be paid over to Midwestern University Foundation, 

Inc., or its successor, and if it be not in 

existence, then to Midwestern University, or its 

successor." 

It is the opinions of this office, after an examination of the trust agreement, that such agreement does establish 

a trust fund. In order for the trust fund to render the 

President of Midwestern University ineligible to receive the 

$1,500 appropriation allowed by Section 24f. Article IV of the 

Appropriations Bill, the trust agreement would have to provide 

for salary supplementation. What benefits to an individual 

might constitute salary supplementation depend simply upon how 

restricted or expanded a definition is given to the term. 

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Hon. G. C. Franklin, page 4 (M-325) 

The cardinal rule of legislative interpretation is 

that, where a statute is open to more than one interpretation, 

that interpretation which will give meaning to the intent of the 

Legislature shall be followed. As directed by Section 54 of 

Article V of the Appropriations Act, it is, therefore, the duty~ 

of the Attorney General to declare what was the int@nt of the 

Legislature in using the,term "salary supplementation" in the 

instant provision. 

The purpose of creahing the trust, as~stated in the 

instrument, is to provide a reward to the President, designed 

as an "inducement for him to remain in his capacity as President 

until such time as he retires." Similar benefits,were considered 

in Attorney General's Opinion M-138 (1967), wherein it is held 

that the expenditure of state' funds to pay premiums~ on insurance 

contracts concerning State'!employees is not extra.compensation 

to such employees, but,, being prospective, is in the,nature of 

an inducement for rewarding faithful public service. 

As there appears nb indication that the Legislature 

considers the contributions of a university president less 

significant, or less worthy of reward for faithful public service, than those of other state employees; and as it appears that 

the trust instrument under consideration would not give rise to 

a conflict of interest situation, it is the opinion of the Attorney 

General that what constitutes "salary supplementation" should be 

viewed in an ordinary, limited sense in this instance. 

"Salary", in tm above sense, is defined as a fixed 

periodical compensation,; paid at regular intervals, for services 

rendered in the course of one's employment. It contemplates 

funds to be paid regularly and to be presently available to, or 

under the actual or constructive control of, the person employed. 

38 Words and Phrases 45 et seq., under "Salary", Blacks Law 

Dictionary, Fourth Edition, p. 1503, under "Salary". Given its 

ordinary meaning, "supplement" is defined as an addition to something, already organized or set apart. 40A Words and Phrases 

361 et seq. Employing the well settled maxim of statutory construction for the determination of legislative intent, noscitur 

a sociis, we hold that where the meaning of the word is doubtful, 

Ttm be construed in light of the words used in association 

with it. 53 Tex.Jur.Zd 221, "Statutes", 5154. Thus, a supplement to salary would be, in the instant case, a benefit received 

by the President in approximately the same manner, and for approximately the same reasons, as his salary. 

It is clear, from reading the trust agreement, that 

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Hon. G. C. Franklin, page 5 (M-325) 

resent1 available to the use or 

~~~~;'~frn~~~"P:~sf~~~~,~ some undetermined sum is 

prospectively available at some future, undetermined date. 

The funds paid into the trust are paid periodically, to the 

extent that a contribution will be made each year, on no ascertainable schedule, but there is no provision for periodicity 

in their disbursement. The sums contributed are fixed only as to 

a minimum amount to be deposited, so that it can never be definitely foreseen what amount wiil be contributed in a year, or what 

amount will ultimately be available for disbursement. 

Thus, it is the opinion of~the Attorney General, that 

contributions to the retirement trust; established for the benefit 

of the President of Midwestern University, are not to be deemed 

supplemental to his salary; nor is the existence of a retirement 

trust to be regarded as a salary supplement; nor shall any funds 

which the President might ultimately receive from the trust be 

considered salary supplement. Consequently, the trust agreement 

in question shall in no way preclude payment to the President 

of Midwestern University of the $1,500 appropriation granted 

by Section 24f, Article IV of the Appropriations Bill. 

SUMMARY 

The establishment of a retirement trust for 

the benefit of the President of Midwestern University, and the existence of and contributions 

to said trust, does not constitute a supplement to 

the salary of said person, so that such a trust 

does not act to render the President of Midwestern University ineligible to receive the 

benefits of Section 24f, Article IV, House Bill 

5, Acts of the 60th Legislature, First Called 

Session, 1968 (General Appropriations Act). 

Prepared by Bill Corbusier 

Assistant Attorney General 

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Hon. G. C. Franklin, page 6 (M-325) 

APPROVED: 

OPINION COMMITTEE 

Kerns Taylor, Chairman 

Sam Kelley 

James Quick 

Tom Fortescue 

Richard Chote 

RAWTHOPNE PHILLIPS 

Staff Legal Assistant 

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