June 4, 1990

Hon. Frank M. Jackson Opinion No.M-644 Executive Secretary Teacher Retirement System of Texas Re: Authority of theBoard of 314W. 11th Street Trustees of theTeacher Austin, Texas 78701 Retirement System to invest trust funds of the System inhome office facilities, including land, equipment, and office building tobe used in ,, administering the System, and related questions. Dear Mr. Jackson: You have requested the opinion of this office regarding the following specific questions:

"1. Does the State Board of Trustees of the Teacher Retirement System have authority to invest trust funds of the Teacher Retirement System **in** home office facilities including land, equipment and office building tobe used inadministering the System? "2, If your answer to Question No. 1 is in the affirmative, does the State Board of Trustees of the Teacher Retirement System have authority tomanage and control suchbuildings and grounds purchased orbuilt with funds of the Teacher Retirement System? "3.~ Ifyour answer to Question No. 2 is in the negative, would the State Board of Control have jurisdiction over suchbuildings and grounds. "4. If your answer to Question No. 2 is,in the affirmative, would the State Board of Trustees of the Teacher Retirement System have authority to pay expenses incurred for operating, maintaining, repairing and improving thebuildings and grounds described inQuestion No. l?"

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Hon. Frank M. Jackson. page 2 (M-644)

The Teacher Retirement System was created~and isgoverned by Article 3, Section 48b, Constitution of Texas, which reads, in itspertinent part, as follows:

"There ishereby created as an agency of the State of Texas the Teacher Retirement System of Texas, the rights ofmembership inwhich, the retirement privileges andbenefits thereunder, and themanagement and operations ofwhich shall be governed by theprovisions herein contained and by present orhereafter enacted Acts of the Legislature not inconsistent herewith. The general administration and responsibility for theproper operation of said system are hereby vested in a State Board of Trustees, tobe known as the State Board ofTrustees of theTeacher Retirement System of Texas, ....Said Board ishereby authorized and empowered to invest and reinvest any of said moneys, securities, and assets, as well as the proceeds of any of such investments, .... or inhome office facilities tobe used inadministering the Teacher Retirement System includinq land, equipment, and office building; ...."(Emphasis added.) Inview of the specific constitutional provision above quoted, your first question isanswered in the affirmative. With regard toyour second question, your attention is directed toArticle 2922-4.09, Vernon's Civil Statutes, which reads, inpart, as follows:

“(a) General administration of and responsibility forproper operation of the Retirement System in accordance with the provisions of this chapter are vested in a State Board of Trustees ....“ In response to a similar question, this office held inAttorney General's Opinion C-705 (1966)that thebuilding constructed by the Texas Employees Retirement System was not subject to the control of the State Board of Control for the reason that such building was constructed with trust funds and assumed the same chracter as those funds. As apublic trust, such structure was not subject to the authority vested in the State Board of Control byArticle 665,Vernon's Civil Statutes. It is our opinion that the legal nature of theEmployees Retirement System and the

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Teachers Retirement System is so legally similar in this respect that theholding expressed inAttorney General's Opinion C-705 controls thepresent question. Accordingly, our opinion is that the State Board of Trustees of the Teacher Retirement System has authority to manage and control buildings and grounds purchased orbuilt with funds of the Teacher Retirement System. Inview of our affirmative answer to your second question, your third question isnot answered. Article 2922.101, et seq.,Vernon's.Civil Statutes, and Attorney General's Opinion C-705, supra, provide ample basis for our conclusion that the State Board of Trustees of the Teacher Retirement System has the necessary.authority topay expenses incurred for operating, maintaining, repairing and improving thebuildings and grounds described inQuestion No. 1. Accordingly, your fourth question is answered in the affirmative. SUMMARY The State Board ofTrustees of the Teacher Retirement System has authority to invest trust funds of the Teacher Retirement System inhome office facilities, including land, equipment and office building tobe used in administering the System. The State Board of Trustees of the Teacher Retirement System has authority tomanage and control the buildings and grounds purchased orbuilt with these funds of the Teacher Retirement System. The State Board of Trustees of the Teacher Retirement System has authority topay expenses incurred for operating, maintaining, repairing and improvingthe buildings and grounds sopurchased. /-I

y General of Texas

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Hon. Frank M. Jackson, page 4 (M-644) Prepared by Malcolm L. Quick Assistant Attorney General APPROVED: OPINION COMMITTEE Kerns Taylor, Chairman W. E.Allen, Co-Chairman Wayne R. Rodgers Earl Hines Jerry Roberts Brandon Bickett MEADE F. GRIFFIN Staff Legal Assistant ALFRED WALKER Executive Assistant NOLA WHITE First Assistant

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