Mr. Arnold W.Oliver, P.E. Opinion No. JM-1170

Engineer-Director State Department ofHighways Re: Conveyance of land from the and Public Transportation Texas Department ofCorrections Dewitt C.Greer State Highway Building to the State Department of Highways and Public Transporta11th hBrazes tion (RQ-1951) Austin, Texas 78701-2483

DearMr. Oliver:

You ask about the construction of abill requiring the Department ofCorrections to transfer certain real property to the Department ofHighways and and Public Transportation (hereinafter Highway Department). Specifically, you ask

e whether thebill authorized the Department ofCorrections to

reserve the mineral rights inthe land in question or whether the bill required thedepartment to transfer title in fee simple.

In 1907 the legislature adopted Senate Bill 52, which provides inpart as follows:

SECTION 1. CONVEYANCE OF PROPERTY. (a) Onbehalf of the state, the Texas Board of Mental Health andMental Retardation and the Texas Department ofCorrections shall sell to the State Department ofHighways and Public Transportation the tracts of state-owned land that aredescribed by Section 2of this Act foratotal amount of $120.6million.

(b)Before August 31, 1980, the .State Department of Highways and Public Transportation shallpurchase the land for a total amount of $120.6million. All the land that qualifies for the expenditure of constitutionally dedicated funds shall be purchased fromthe constitutionally dedicated

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portion of the state highway fund.1 The remainder shall be purchased from the statutorily dedicated portion of the state highway fund.

Acts 70th Leg., 2dC.S., ch. 2, 51,at 5 (footnote added).

You state that theHighway Department tendered the purchase price to the Board of Mental Health and Mental Retardation (hereinafter MHMR) and the Department of Corrections. MHMR delivered a deed conveying, without reservation, theproperty described inSenate Bill 52. The Department of Corrections, however, refused to execute a deed transferring title in feesimple and took the position that the legislature did not intend that the Department of Corrections transfer the mineral rights in the land in question.

1. Article VIII, section l-a, Texas Constitution provides that revenues fromofmotEr vehicle registration fees and taxes onmotor fuels and lubricants shall be used only for certain specified purposes, most of which have to dowith financing of roads and highways. Article VIII, section 7-bprovides:

All revenues received from the federal government as reimbursement for state expenditures of funds that are themselves dedicated for acquiring rights-of-way and constructing, maintaining, and policing public roadways are also constitutionally dedicated and shall beused only for those purposes.
Section l(b) of Senate Bill 52 restates the constitutional requirement that theHighway Department may expend funds from the sources described in those constitutional provisions only forpurposes set out inthose constitutional provisions. Wenote that section 4(b) of Senate Bill 52would allow theHighway Department to lease back toTDC for $1a year anyportion of the land acquired fromTDC pursuant to Senate Bill 52. The constitutionality of such a lease would be in question if the Highway Department used funds subject to section 7-a or section 7-b ofarticle VIII topurchase the land from TDC.

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The legislature has exclusive control over the disposition ; mna Co,, 175 S.W.Zd 410, 414 (Tex. 1943); pauahters of the Renu&&.j& 156S.W. 197, 200 (Y Attorney General Opinion JM-242 (1984). Senate Bill 52 states that the Department of Corrections I'shallsell to the

if state-owned land. See Lorino Y. Crawford Conlev Pex. 1913;;

State Department ofHighways and Public Transportation the tracts of state-owned land"described inthe bill. Thebill contains no language indicating that the Department of Corrections should retain any interest in that land. In grants of land, reservations ofmineral interests must beby clear language. sharp v. Fowler, 252 S.W.Zd 153 (Tex. 1952). InTexas, under both case lawand statutory law, a grant of landwill be construed asagrant of an estate in fee simple unless the conveyance isexpressly limited. & of Stamford King 144 S.W.2d 923 (Tex. Eastland 1940:writ rLf#d) Civ. APP. - :Prop. Code §5.001(a). We think the courts would apply an analogous rule to construction of
a statute requiring one state agency to transfer real property to another state agency. Therefore, we do not think the Department of Corrections was authorized to
reserve to itself themineral estate inthe land described inSenate Bill 52. See aeneraLly Attorney General opinion WW-207 (1980) (statutesgoverning Department of Corrections indicate legislative intent to regulate closely disposition of land under control of Department of Corrections): G Acts 1930, 41st Deg., 5thC.S., ch. 67, at 215 (authorizing Department of Corrections to sell certain property, but requiring that oil, gas, and mineral rights be reserved to state): Attorney General Opinion JW-242 (statute permitting board of regents "totransfer and convey" land under terms and conditions deemed advisable by regents allowed regents to convey easement or feesimple title).

Two arguments have been raised in support of TDC's position. One isthat the amount tobe paidby the Highway Department for the landheld by TDC is the value the General Land Office placed on the surface estate in that land. However, there isno requirement that a state agency receive "adequate compensationw when state property in its custody is transferred to the custody of another state agency. m Attorney General Opinion WW-1273 (1962) (land acquired in name of county for construction of state highways is state property regardless of fact that deed is made out to county); we a180 Tex. Const. art. I, § 17 (requiringpayment of adequate compensation when private property istaken forpublic purposes).

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The other argument is that TDC's retention of the mineral rights isrequired by the following Appropriations Act rider:

No state lands shallbe soldunless the

mineral rights are retained by the state, unless impractical.

General Appropriations Act, Acts 1989, 71st Leg., ch. 1263, art.V, 583; General Appropriations Act, Acts 1987, 70th -g., 2dC.S., ch. 78, art.V, 579. Regardless of whether TDC or the Highway Department holds title to the mineral rights in the land inquestion, those rights will beheld by the state. Conseguently,,,that rider has no application to your question.

SUMMARX

A bill requiring the Department of Corrections to transfer certain real property to the Department of Highways and Public Transportation did not authorize the Department of Corrections to reserve to itself themineral estate inthat land.

JIM MATTOX Attorney General ofTexas

MARY KELLER First Assistant Attorney General

JUDGE ZOLLIE STEAKLEY Special Assistant Attorney General

RENEA HICKS Special Assistant Attorney General

RICK GILPIN Chairman, Opinion Committee
Prepared by SarahWoelk Assistant Attorney General ,

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