OFFICE OF THE ATTORNEY GENERAL OF TEXAS AUSTIN

Iionorsbls

c
. H. c.aYnesa State Auditor Auetln, !l'ex4m

Dear Sir:

e OS yow.ppohlem olved in ita aoluthe pragptPesa

of eratlon

of your reFoundation for oorporatu?rl,
a State, for the eaw.Pias end 1, aa proper* es of the X&dty, and other hospIt& builm or buildings La the City Oi mlvestonin oonneotlon nlth the John seelyxospital and the endannenfthareof, fwtheuse ofthepeopls of the said City of Qal*eston, by prov~d.dlng;

thein wfthHon. c. 3. cavness, Page 2

the naaessary

mediaal

mre atxI

attention

therein, the legatees

u&der the will of the estateOS John S~ly,dea~sed,~eclohotthlrm,beandarahe~- by mlleved and ralsesed frompaymentof taxesprovided for ln Chapter 5, Title 122,RevlsadStatutes of Texna,generally knowna5 Inheritanoe lkxer, and the state c0mptr0iiOr and the 'paxc0ut0t0r or (kiVestonCountyantheMbO~~andd~u~not to oolleat

or 

### l ttaaptto oolleot

auuh tax or tame, whloh ta%ea if not ao herebyrelsaaed vouldbe parable outofthepart; ofhis eatcstedetiaedaxx3baqueatbed

by said Scaly to said Foundatian, and provided, however,

that the City of Oalventon ahellnot thembybs releasediropIanyobllgatloninorundar a oertaln

leaseof said Yoba ScalyHospital,exeoutedby the Board of Regentsof the Rnlvarsity of ~~,PithsaZdCity,datedthc9thdayoi~y,

. "ssotion

2i S8Qtio&1lmwof8b6il3 beeoslevoid unlsaathe "scaly

end smithRotrndsts.on ror the John ~~Hospital*hau.sithin.sir8onfha~~~rfhs palream.

~#. tU:A& enter rat;0 M Bap?e#osrrt

with the 'Road a? Rego&iiaf: the lJamm#ity of sxm)~
a orgywhereof

mrt~ed aa a em otspyby fh8 P.yMeat.0~ the~U~&veraitj of Taxas&all be~fU.ed wltlt ~tbo t3awMry of St&e wbamby thk-sea1y and SndthFounb*tionfar~o Johealy Eosp~talrball : agreawithaai+3BoaMoilbgent~to8q$reg*toaad a~t,apartpmprmty;ort?wprWWl8thaPaof,ar aaah, orpewt~prqw$y~~lycruh, ts.k 

### l grW .t@ w~~,duidbe$v@ea ’~Wd‘ Fbmda~iqa &ad .$l.w Mid Re t,a 

### of 8 raltM aQAak.to

m - !l%oudy$~;00.c?3) Dolkr?r, thr 

### eatmtsd " i amountof taxm w.bymd~'~:#l&xtlaq 1 hewcand bywhlah said PoundatLom.~eWLl;rgrWto~keop auah prop w t y a q w a t o f r o nit * e t he r lw t a or prq m t y a n d to w e t h r

3 x & o o me

t he r a m l a l a l e r t he dlrmtion and r it htha a jq mv a l a l. ,s*Zd~Regwita f orU; r a Yeh a sea4 Htmpitnl, twaay a@dltluna thqroto .m .Bullw t0 be wed in OUIIUW**~~WWL~,~O~ r0p* 0f th0 purporer

8pecitied.btkb lKll1 of a4d.d

Yoha saalr. T& sum htWebyrerd.tt8d &Q.l ;pbrpsourl~

b Uadm'Hon. C. R. Cmmess, Page 3

the jointoontrol

of the Board of Regentsof the

-- Unlverslty

of’ Texas,and the Seslyand Smith Foundation

to invest

and reInvest

the prooeeas. Approved,

Ootober

1, 19Z6.n

we have aneertained that the 0ondlt10w oontalned in Sootion

2 ol= the Aot vere met by the Foundatlan and by the Boarrl cURegents oqJanwrp31,1927,endttuttthm fund thus orented haa alnoe

been admlnlstered

in aooordanoe

v%tb the provlslonn of the Bat.

Although

the Aat speaks in temna or u *release* of lnherltanoe

tuxtar, we are or the optnionthat the Aot 88 a whole does not agotmpllnh a relaeseOF rmn.laeIon of t&see,

and henoe t.b&t the Aot doe8 not run afoul or those ~OVISIOM or oup conatltutlon

vblohproblbLt

the rsmLaaion

of taxes. ,%&ion 1, the Section whIoh purportedly "re3mwes" t&m tmcos,cm&.& an a gMatiqf$nat*,baps beocmeaffeatlve oq@vhsa $700,ooo, the. 08tba&Od OBBwmt.W tUce# releaSea .bpSeetlcm

la, ma ret aaldetwLsrthe.teras 

### andeol@it~ ou30otian2. 

### state&dirrdiy, agy eh5m.t of l.,~r e l e a s e wueh d.gbt have be& bhorsat in the~operathnof sSoW?nlvas lmedZately~crfmntsr-balaaoed by the aeg2yga$am of a aa #@d@.od ag "the e5tinurtt$d ylox$or ~t*rsd. *,kr;r&j."

bj,~:-.,;Ebof&&

we huve bee@aJlmmd by 

### reprssentativeu of the

"thmthenmountof mmhliab$li~~. ,Comidmed asavboM, the Aot IS en appreps?Utioa @6athar &lam a mleaae, an apprupr.lation fs the aaanner.and

for the purpeses~nt.sted in sootlen2'aereof. It remains

to $0 seen~wlmthes

the Iagi.slature

poilass8ed

the power to mnke an appf@H.attonor ttrls kWd.Hon. c. FL cavaeua, PQge 4Hon. c. H. CaYne5s, Page 5

A8 statedin the Aot, the Joha~Sealy Ho~pltal

is, amlwaaattketims o?thepssssge o?theAat,oumdbythe 8tate OS 2ema and wed ior olintoslpurpo5es tqths.vledioal lJehoo1 of the University

of Tsxaa. Sindlarly, M have aaoertalnedtlu%ttkobdldiage inoormeotionpith tkeXorrplt&l are and ware wed HOP 8duoutiowlpurpasea by pai8 sdmol. It is alem, wo fool, thut the lfospital aad its attemlant buudlnge nrewedfora 'govezmmsntslpurpose" o?the State,ati that eixpauttuw ?Poathe lnrm?#e Ofthefwd tiQum8tionare authmlmA 6aly in oonneotfon vith and in the ?urthmanos of such purcporre.

SeetIau

51 of Artl~leIII of our C0nstitutks.n pmnr¶Aes 

### inpartanfollwa~

*iOn vita fbe lneening of the l bov6-Quoted

af.wtt~ tutioztalpwMslon.HOL c. H. Cevwss. page 

### 6

Thus,although

the lZtem1 wm&g OS the constitution problblts

all grantato a munLalpt31 OT other eorporatlon, our aourte have,with respsotto munloipal and political

oarparetlone, intOPpl’8tOd

this ~OV&SiWl 80,

pl’Ohibiti.?i&

Otis those gP&UtS vhicrh

are not for 8 gfxern;wtntul purpose. That a similarlnterpsetetion is applicnble

to privateobarltable oorpoxations

of the typeunder dlsousaioil

is lll.~lat??ated

by the eme or conleg v. naughtem of the Republio,

1% 3. W. 197, 

### I57 S. I?. 937. muler th8 ?8miller sectsof ws eajgse

t&3 3it6~te

ptlrobaeed

the Alamo for the use and 0nJoyment

of tbe peopleof lexa~, and, ardw le~elatlve dlreotion, the govwnor deliveeed.&.ob property

to the eurtody

and owe of the @wghtera of the Republlo o# 2exen,

a gam,“‘roP edtist1ow1 purposei, xa le&elature,the Court,e?tsr ststlng 0r the ~Stiato over it8 pmpe~y, atstaluded~



### Although

not Uwol Of Icing

Y. 

### shep?@i?d,

157 8. aprivate osrijor~tlon

theokiraa 682 (OrPor

P4fuaeddf

thP@w addltiOaalll.@t

ap0nthiaprObl~i IntiUa ~&Seth0 fWIitent1~ 

### weanmdethattheabws quoted 

### oaoati~utlaaal pzwvbbn prohibited the stute

froa lad to the over; thetitle,

oqo and owtouy of stof6 Hat we en a Riltfonel PaPk, 

### Servfqa

of thb%dnval Oapsrnrpsnt ?or In is j~otlng

thitr“‘aicIltentto



### tha court quoted ?rom8n&adopted

the 0 iaieno?thecpeariea~ee 

### 4qreme CotlPt in Halme 01 Peay,

159 !karh3El,17 8. W. ,(2d) 901, aa~ s0nm8
*Woreover,a 

### traaefer of the titleto landa S&mHOII. C. H. CsameSS, Page 7

Maa United States. The paeel.ng of thle property From one government; to the otitar

tivolwieno I.osa to the citizen or taxpayer. The o3ajeot of the uontrt cl. t0 t& invokedwa3 to prevent a loss
its cP0dl.t. Bere not only can no loss result, but the sttits.

OOX33%deFed

830 a pOliCloa1Sllt;tty,i3 rerights tmd privileges of tbfs gr be presoxvsd to the people 0,' Teriue3see.I

"We tM’ ;I.. ‘ .k this decision is souzd and shcxld be rOu0vtsa

as the law of thi.3 aa3e. ” @@233ie added)

We feel that the cumulativeei%ct of these deoi&ms is to demonstsstethat the lMb,bitlons of' ScctLon 51 of Artlole III or the Constitution are oper&Lve only Vrzan the grant hy the State ie, or oan be;a diversfan of State

property

ux Sunde to nonqwJPnmenta1 purposea. Conversely, so long as the it is itma gmrnmerital prpcse;sdl haa onlybe used $3~ auohpurpow, we r3w that this SsctQJn is Lnopexative.

Iit the iIL3tSat

81tUZtfiOfL,

the Se?il~.+nd

iSslit&Fwndation is but 3 joint'oustedfan of the fund ,in *ehtlciti,

posaas- ;Lz ast ort3y

the povero of a jolnt trusteewith qwspootto
for g& Xarsover, the Fo?andatlan aray expe& auoh faoa oalo ental purpoeea a& nosy mke suoh srpe&l.tw?es only under the dirootlcn a~nd tith the appmrel OS the Btxzrd of Xsgenta o? tha lJla-5rslty cr Texea. In au& a sftuatly the eppzwpx$atitan 2;~th.s Lsglblatureconnot be said to be a gratuitousdon&ion to a corporation. Retither oan it be se&d that the spp&'opxistlozi

dlvcst% tha ciblsfm and tazpqem 09 !k.as of the r@ht or use 0r th3 furd OFfv4pal.mtb3f.rbsneitoiel rights theveto. Under ths teme oi the 8 propxiatfon,
e allo p3avl.l.ege8 of the State titb respsc to the iuad are pruaerved.

Apart trOm Chh,

mttera herotoiore d%smssed, we 48~ peroelve no smlous qusatfonsvMah al&t be mLsed agaC%st the oonstitutionality

of the Act urrder

dlsoussion.Cvtly, PU are wspeotfullgadvfaed that the At& Is Ln all wap v?Ciid and oonstltutional. !l!hLo oonalu8ion

renduP unasaesaary an 811lR7yn to your iaquLry as to the titwe of the aotion whiah ehould be tabn lf the Aat were to be i%%Id u!momtltIltio~~.Hon. C. If. Catmess, Pegs 8

lbu8tln.g

thet the foregoingiullyanswers your lnquiky,

ue era

Your0 very truly