# The Attorney General of Texas

September 13, 1982

MARK WHITE Attorney General

Supreme Court Building P. 0. BOX 12546 Austin, TX. 76711. 2546 5121475-2501 Telex 9101674-1367 Telecopier 51214750266

1607 Main St., Suite 1400 Dallas. TX. 75201-4709 2141742.6944

4824 Alberta Ave., Suite 160 El Paso, TX. 799052793 91515333464

1220 Dallas Ave., Suite 202 Houston, TX. 770026966 713/650-0666

606 Broadway, Suite 312 Lubbock, TX. 79401-3479 6061747-5236

4309 N. Tenth, Suite B McAHen, TX. 76501-1665 5121662.4547

200 Main Plaza, Suite 400 San Antonio. TX. 76205-2797 5121225.4191

An Equal OppOrtunityI Affirmative Action Emplover Mr. Laura Cavazos President Texas TechUniversity Health SciencesCenter Texas Tech University Lubbock.Texas 79430 OpinionNo. MU-514

Re: Authority of Texas Tech University Health Sciences Center tobuild a structureon property deeded to it by the city of Odessa and Ector County subject to an easement, exceptions, reservations and right of reversion

Dear Mr. Cavazos:

The following from this office. is a response to your request for a legal opinion In your request you indicated that the city of

_. . Odessa and Ector County conveyed approximately 6.2 acres ot land located in the city of Odessa to Texas Tech UniversityHealth Sciences Center (hereinafter TTUHSC) for the purpose of constructing and maintaining medical school facilities. The facilitieswould provide teaching, research, administrative and other medical and health care relatedactivities for the community.

The land was conveyed to TTUHSC by a general warranty deed subject to the following easement, exceptions, reservations, covenants,and rights of reversion:

1. Grantor shall retain an easement touse the property described herein for parking and like
uses until the time of constructionof themedical school facilitieswhich time-of constructionshall be evidenced by written notice furnished to Grantorby Grantee stating that ithas approvalof all of the necessary construction funds and is ready to commence construction.

2. Grantee shall furnish Grantor with written notice of the approval of the funds necessary for constructionof themedical school facilities. In the event that such funding is not approved and notice furnishedas providedhereinwithin fifteen (15)years of the date this deed is signed, then

p. 1859Mr. Lam-o Cavazos - Page 2 (Mw-514)

title to the lands described herein shall revert to the Grantor when Grantor furnishes to Grantee notice of such condition and files a copy of such notice of reversion in the deed records of the County Clerk of Ector County.

3. Grantee shall furnish Grantor with written notice of the time to cotmnence constructionof the medical school facilities. In the event that such construction does not commence within thirty-six (36) months of the date the total funds are approved,then title to the landsdescribedherein shall revert to the Grantorwhen Grantor furnishes to Grantee notice of such condition and files a copy of such notice and reversion in the deed recordsof the County Clerk of Ector County.

4. Subject to the above expressed conditions and rights of reversion, it is expressly agreed that this conveyance shall be absolute and continue in full force and effect so long as such lands are used for the purposes of construction and use for medical school purposes and facilities, or for teaching, research, administrativeor other relatedmedical and health
care activities of Texas Tech University Health Sciences Center. However, should Grantee cease construction or use of such land for such aforesaid purposes or activities for a period of time of more than eighteen (18) successivemonths and afterwritten noticeby theGrantor to Grantee of Grantee's violation of the foregoing conditions, then title to the herein conveyed lands shall revertback to theGrantorhereinwhen Grantor files a copy of such notice and reversion in the deed records of the County Clerk of Ector County.

5. All notices to Grantee shall be deemed deliveredby depositing suchnoticeswith theU.S. Mail addressed to the Chairman of the Board of Regents, Texas Tech University Health Sciences Center, Texas Tech University Campus, Lubbock, Texas. All notices to Grantor shall be deemed deliveredby depositing such notice with the U.S. Mail addressed to the County Judge, Ector County Courthouse,Odessa, Texas.

p. 1860Mr. Laura Cavasos - Page 3 (MW-514)

You have asked this officewhether TTUHSCmay lawfully construct medical school facilities on the land subject to the foregoing easement, exceptions, reservations, covenants, and rights of reversion. It is our opinion that TTUHSCmay lawfully construct such facilitieson said land.

TTUHSC has general authority to construct medical school facilitiessunderthe followingtwoprovisions:

1. The board [Texas Tech University Board of Regents] shall make provision for adequate physical facilities for the Health Sciences Center, including library, auditorium, and animal facilities, for use by the Health Sciences Center in its teachingand researchprograms.
Educ. Code P110.07.

2. The board has the sole and excl"sive management and control of lands set aside and appropriated to or acquired by the institutions under its governance. The board may lease and otherwise manage, control, and use the lands in any manner and at prices and under terms and conditions the board deems best for the interest of the institutions....

Educ. Code §llO.ll.

The foregoing authority is limited, of course, by the state constitutionalprohibitionsagainstgratuitouslygrantingpublicmoney or things of value to others. Three prior opinions of this office discuss the constitutional limitations in cases somewhat similar to the one before US. The question in Attorney General Opinion H-257 (1974)was whether the Parks and WildlifeDepartment could spend state funds,matchedby federal funds, to construct facilitieson land owned in whole or in part by the federal government without violating article III, section 51 of theTexas Constitution,which states:

The Legislature shallhave no power tomake any grant or authorize the making of any grant of public moneys to any individual, association of individuals, municipal or other corporation5 whatsoever....

Our opinion concluded that the proposed expenditure would not violate the foregoing constitutionalprohibition against gratuitously granting public money because the expenditure had a valid public purpose and an adequatepublicbenefit.

p. 1861Mr. Laura Cavazos- Page 4 (MW-514)

InAttorneyGeneralOpinionH-403 (1974)the questionwas whether
a state agency could construct a building on land that it did not own but merely leased. When the lease terminated, the building would become theproperty of the landowner. We concluded that:

[i]n our opinion if an expenditure for the erection, repair or maintenance of an improvement
on leasedproperty is for a proper public purpose and if the considerationor benefit to the public is adequate, the transaction is not rendered invalidby the possibility that the private party will realize an unexpected incidental benefit. (Emphasisin original).

The third,Attorney General Opinion H-655 (1975),was written in response to a question regarding the authority of Texas A & M University System to construct a building on land thatwas subject to
a possibility of reverter. We concluded that it was, based on the public purpose and public benefit test announced in the foregoing opinions. The opinion concludedby saying:

Since the public purpose and benefit are evident in the instant case, and since there is less possibility of divestiture in this case than in those involved in our prior opinions,we believe the proposed expenditures would be clearly constitutional.

With this background, we turn now to your question. We note first that only one of the five restrictions in the deed to TTUHSC raise the constitutional question discussed in the foregoing three prior opinions of this office. The firstparagraphmerely reservesan easement for parking until construction of the medical facilities begins. Paragraph 5 deals with notice. Paragraphs 2, 3, and 4 all contain reversionaryclausesbut only number 4 raisesa constitutional question regarding thepossible reversionof themedical facilitiesto be constructed by TTUHSC. Reversion under paragraphs 2 and 3 would occur, if at all, prior to the constructionof-themedical facilities before any public fundswere expended.

Under paragraph 4 it is possible that the medical facilities to be built,by TTUBSC could revert to the Grantors. There are two conditionsunderwhich a reversion could takeplace. The first is if the constructionof themedical facilitiesceased for a period of time in excess of eighteen successivemonths. The second condition is if the lands ceased to be used for the location of medical school facilities, or the facilities ceased to be used for teaching, research, administration, or other related medical and health care activities by TTUHSC, and such condition continued for a period of time in excess of eighteen successivemonths.

p. 1862. .

Mr. Laura Cavazos - Page 5 (MW-514)

Both of the foregoing conditions thatwould create the basis for
a reversionarewithin the abilityof TTUHSC to avoid. By seeing that the conditions do not occur, TTUHSC can retain title to the land and the medical facilities indefinitely, thereby forestalling any constitutional question regarding the gratuitous grant of public moneys.

In any event, it is our opinion that TTUHSC has statutory authority to build a medical facility on the landdeeded to itby the city of Odessa and Ector Countyand that expendituresfor thispurpose will be for a proper public purpose and will result in an adequate publicbenefit to TTUHSC. E Educ. Code §110.09.

SUMMARY

On the facts provided, Texas Tech University Health Sciences Center may construct medical facilities on land deeded to it by the city of Odessa and Ector County but subject to certain easements, exceptions, reservations, covenants, and rights of reversionwithout violating article III, section51 of the Texas Constitution.

MARK WHITE AttorneyGeneralof Texas

JOHN W. FAINTER,JR. FirstAssistantAttorneyGeneral

RICHARD E. GRAY III ExecutiveAssistantAttorneyGeneral
Preparedby RalphAldave AssistantAttorneyGeneral

APPROVED: OPINION COMMITTEE

SusanL. Garrison,Chairman RalphAldave Jon Bible Rick Gilpin PatriciaHinojosa Jim Moellinger

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