TEE ATTORNEY GENERAL 

OF TEXAS 

October 7, 1988 

Honorable Tim Curry Opinion No. JM-964 

Criminal District Attorney 

200 West Belknap Street Re: Authority of a county to 

Fort Worth, Texas 76196 make mortgage payments on 

behalf of its indigent residents (RQ-1413) 

Dear Mr. Curry: 

You ask whether counties may make mortgage payments 

on behalf of their indigent residents. Your question is 

prompted by an administrative rule adopted by the Texas 

Department of Human Services pursuant to chapter 34 of the 

Human Resources Code. Two issues must be considered: 

whether the county has statutory authority to provide such 

financial assistance and whether such statutory authority is 

consistent with provisions of the Texas Constitution that 

require public funds to be spent for public purposes. 

Attorney General Opinion JM-942 (1988). 

Counties in Texas are limited to exercising those 

powers that are specifically conferred on them by statute 

or the constitution, but they have broad discretion in 

exercising express powers. Canales v. Lauchlin 214 S.W.Zd 

451 (Tex. 1948). The statutory authority for &he expenditure about which you inquire is found in chapter 34 of the 

Human Resources Code. That chapter requires the Texas 

Department of Human Services (the Department) to establish a 

fund to assist local communities in meeting the needs of 

individuals and families for temporary emergency relief. 

Hum. Res. Code 5 34.003(a). 

The services are funded 50 percent with local funds 

and 50 percent with matching state funds. The statute 

authorizes a county commissioners court to apply for a grant 

to administer the program on behalf of the county. Id. 

50 34.002-04. The county must submit to the Department a 

plan for providing emergency relief, which must include a 

description of the target population, eligibility criteria 

to receive services, the nature and scope of benefits to 

be provided, methods of administration, and a budget 

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Honorable Tim Curry - Page 2 (JM-964) 

that contains the sources of local matching funds. 

5 34.006(a), (b). The Department shall adopt rules es?% 

blishing criteria for determining whether a county or other 

applicant qualifies for a grant-in-aid. Id. § 34.004 (d). 

The Department is also required to develop standards and 

procedures for the program that permit all counties in the 

state to participate. L 5 34.004(f). 

The statute is intended to enable local governments to 

aid needy individuals, including homeless persons. The 

legislature has acknowledged that local government and 

nonprofit programs are presently overburdened and that the 

inability to adequately assist homeless and needy residents 

causes family, social, and economic instability, as set out 

in the purpose clause of chapter 34. 

(a) The legislature finds that: 

(1) economic and demographic changes 

have created rapid increases in the number 

of needy persons who are homeless or without other necessities of basic existence; 

(2) local governments and nonprofit 

service organizations are unable to meet 

the increased financial burden caused by 

those changes in various areas of the 

state: and 

(3) the dramatic nature of the emergency relief needs in various localities 

has contributed to family instability 

and threatened the social and economic 

stability of those communities. 

(b) The intent of this chapter is to 

serve a public purpose and the goals of the 

state by providing state money to match local 

and any federal money available to provide 

emergency relief to needy persons. 

Hum. Res. Code !j 34.001. 

Section 34.007 establishes procedures and guidelines 

for counties to follow in determining eligibility and the 

frequency and duration of benefits under the program. A 

county may not set the eligibility level at "less than 75 

percent of the federal poverty level based on the Federal 

Office of Management and Budget Poverty Index in effect at 

, 

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Honorable Tim Curry - Page 3 (JM-964) 

the time the plan is submitted to the Department." Id. 

s 34.007(c). Assistance "may include the provision of 

utilities, food, housinq and clothing to needy persons." 

Id. S 34.007(d) (emphakis added). pursuant to section 

34.004 of chapter 34, the Department adopted the following 

rules for provision of housing assistance under the program: 

[T]he [county, other political subdivision, 

or non-profit corporation] may deliver the 

following services: 

(1) mass shelter -- purchasing cots and 

blankets and renting space; 

(2) emergency rent -- paying for one 

month only to prevent eviction and to provide 

housing for the homeless; 

(3) mortgage assistance -- paying for one 

month only prevent eviction 'or 

closure . . . .:" 

40 T.A.C. S 10.4304(b). 

Chapter 34 authorizes the provision of temporary, 

emergency housing assistance. Iiomelessness is not a prerequisite to assistance. Rather, prevention of homelessness 

and promotion of stability are primary purposes of the 

statute's enactment. These purposes are SSNSd by the 

provision of one month's mortgage assistance to a person or 

family on the verge of homelessness through eviction or 

foreclosure on their home. This form of assistance allows 

the family time to take measures .to prevent eviction or 

foreclosure or to find other housing. We do not see that 

making a mortgage payment is significantly different from 

making a rent payment for individuals in this situation. 

Indigents do not need to be totally impoverished before 

assistance may be provided. Attorney General Opinion O-2474 

(1940)'. The legislature, in enacting chapter 34, clearly 

did not intend that a family must be totally destitute in 

order to qualify for housing assistance. Instead, one 

1. According to the Department, VlosureV8 is a typographical error in the rule as adopted. The Department 

interprets the rule as applying to "foreclosure.!' 

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Honorable Tim Curry - Page 4 (JM-964) 

specific restriction the legislature places on the administration of the program is that the eligibility requirement 

cannot be set lower than at 75 percent of the poverty level 

established by federal guidelines. 

"It is not an invalid delegation of legislative 

authority to grant to an administrative body the right to 

make rules to put into effect completed laws." 

c 

Housing 

87 (Tex. lz40). 

'n ot a 143 S.W.Zd 79 

The Department rule allowing counties t; 

make mortgage payments on behalf of indigent residents 

directly achieves the stated goal of chapter 34 of the Human 

Resources Code. 

The statutory authority of chapter 34, to be valid, 

must be consistent with provisions of the Texas Constitution 

prohibiting expenditures of public funds for 

Article 3, section 52, 

private 

purposes. of the Texas Constitution 

provides: 

(a) Except as otherwise provided by this 

section, the Legislature shall have no power 

to authorize any county, city, town or other 

political corporation or subdivision of the 

State to lend its credit or to grant public 

money or thing of value in aid of, or to 

any individual, association or corporation 

whatsoever, or to become a stockholder in 

such corporation, association or company. 

Article 3, section 51 places a similar prohibition on direct 

legislative grants to individuals or corporations for 

private purposes. In our-opinion, the expenditure of state 

and county funds for the purpose of making a single mortgage 

payment on behalf of an indigent resident is constitutionally permissible. 

The intent of the provisions of article 3, sections 51 

and 52 is to "prevent the application of public funds to 

private purposes.l@ Bvrd v. Citv of Dallas, 6 S.W.2d 738, 

740 (Tex. 1928). On the other hand, expenditures made for 

the direct accomplishment of legitimate public purposes are 

not unlawful simply because private business may benefit. 

Barrinoton v. Cokinos, 338 S.W.2d 133, 140 (Tex. 1960). 

The final determination of what is a proper public 

purpose is a question for the courts: a 

declaration of public purpose is 

legislative 

Hisainbotham, 

to be given great weight. 

143 S.W.2d 79, 83 '(Tex. 1940). The 

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. Honorable Tim Curry - Page 5 (JM-964) 

legislative determination will not be overturned absent a 

court finding of arbitrariness or lack of due process. 

State v. Citv of A!&$& 331 S.W.2d 737, 743 (Tex.- 1960); 

Attorney General Opinion'JM-805 (1987). 

In ~iaoinboth~, sunra, the supreme court held that the 

purposes served by the Texas Housing Authorities Law, 

clearance of slums and construction of low-rent housing, 

are proper purposes for which use of public funds may 

authorized. 143 S.W.2d 79 at 85. The stated purpose of 

diminishing the adverse impact of homelessness articulated 

in section 34.001 of the Human Resources Code is similar to 

the legislative statement of purpose considered by the 

Hiosinbotham court. &.g j& at 81, 82. The purposes SSNSd 

by slum clearance and housing development are not rendered 

constitutionally impermissible because personal gain to some 

private individual results. Davis v. Citv of Lubbock, 326 

S.W.Zd 699 (Tex. 1959). Thus, we do not believe the 

purposes stated in chapter 34 are per se unconstitutional 

merely because a property owner or financial institution 

might ultimately benefit from the receipt of one rent or 

mortgage payment. 

A government entity may contract with a private 

institution or another political subdivision in order to 

provide for public or governmental programs for proper 

public purposes. Attorney General Opinion JM-65 (1983). 

Whether a particular expenditure which benefits 

individual is permissible under the constitution must Z 

determined on a case-by-case basis. CornDare Attorney 

General Opinion JM-103 (1983) (permitting a county to 

contract for the operation of a recreation center to be used 

by elderly residents) & Attorney General Opinion MW-22 

(1979) (concluding that authorization of utility bill 

payments on behalf of elderly persons violates the constitution). In order to be constitutionally permissible, an 

expenditure of public funds must be for a public purpose and 

must include controls to ensure that the public purpose is 

carried out. See Attorney General Opinions MW-373 (1981); 

MW-423 (1982) ; JM-157 (1984); JM-768 (1987). The 

expenditures authorized by chapter 34 meet both these 

requirements. 

A public purpose is served when temporary emergency 

assistance is provided to needy families and individuals 

living in the community. The obvious societal costs of 

homelessness make housing development and housing assistance 

of particular public concern. Expenditures made pursuant to 

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Honorable Tim Curry - Page 6 (JM-964) 

--, 

chapter 34 appear likely to produce savings in existing 

social welfare and housing programs. 

Controls established by chapter 34 ensure that funds 

authorized by the statute will be used to carry out the 

public purpose expressed by the legislature. Counties may 

receive a grant-in-aid only if they provide evidence showing 

a need for assistance in accordance with the Department's 

rules. Hum. Res. Code § 34.004(c). The counties must also 

provide a detailed plan for providing emergency relief. Id. 

5 34.006 (a), (b) - Restrictions on administrative costs, 

auditing provisions, and reporting requirements also help 

ensure that the public purpose justifying the emergency 

assistance program will be carried out. 

SUMMARY 

A county may make mortgage payments on 

behalf of indigent residents to prevent 

eviction or foreclosure as part of a 

temporary emergency relief program for needy 

persons approved 2,;:; D;;art$enkh;f Human 

Services under Human 

Resources Code. 

Very truly yo , l-I.--k . 

- 

JIM MATTOX 

Attorney General of Texas 

MARYKKLLER 

First Assistant Attorney General 

LOU MCCREARY 

Executive Assistant Attorney General 

JUDGE ZOLLIE STEAKLKY 

Special Assistant Attorney General 

RICK GILPIN 

Chairman, Opinion Committee 

Prepared by Karen C. Gladney 

Assistant Attorney General 

P. 4911