"I'~XEATTOWNEY GENERAL 

PRICE DANIEL 

ATTORNEY OENERAL 

Bon. A. 0. Huellrs 

Oounty Attorney 

$"6: c;w& 

9 

OFTEXAS 

Augart 18, 1950. 

oQanion Ho. v-loag. 

Rer The author%tJ of the 

coplrpisetonerr ’ oourt 

to cash Ooverrrasnt 

bond whoa1 fund Inoestaents befor. saturlty an6 Ire&avert 

&ggpg; &$g 

a lower Interest rate. 
-- . . 

Hoa. A. 0. llu8ller, PIge 2 (v-lm9) 

settlera. Said lands, ana the p00esas 

theroof, vhea 80la, shall. b8 held by eaid 

oouaties alonr 88 a trwt for tha braat 

of public sahoolr th8reia; sala proowdl to 

be lntwtrd la bonds of thb Uaitad 8trt.r; 

the Stats of Zuu8, or oouaticu in 88id 

State, or la such othrs 88cur;tiea, and under suoh restrlotione a8 my be p88awlb~d 

b 7

lawj and the oouatles oh11 be rerpoarie for all iavrstmeatb; the iatemrt Wwoo~~~$uldo~m~e~mnn~ gxoopt the pirroipal 

0 

Artiole 2624, V.O.S., pmvlbers 

%8ch oounty may 8811 or alepose of the 

land8 gmnted to It for eduoatlon81 porpo808 

la such a8nner a8 may be p8ovlQod by the oomtmlrsioners court of such aowty, and th8 prooordr OS any ruoh sale 8h8U be invortad in 

babde of the United States UI Sbrtie of Vua8, the beads 0r the oouldes 0r th8 statr, 

rDdth8 laQ.p8naent or oomon8ohoolal8- 

tplete, road preoinot, dmimge, irrigrtion, 

n8vi 

& 

ation and lrvso dirtrIot lo tU Ilkto, 

and he bond8 of Incorporate& citira an6 

towne, and held by suoh oounty alone a8 a 

trust for the benefit of ublla free school8 

therein, only the interee e thereon to be 

used and expended 8rW811y.Y 

By virtue OS the foregoing constitutional and 

statutmt provirionr latorort p8id oa lavestments of 

moneys belonging to ihe per*anent school fund of a oounty ia doposltrd In the available eohool fund OP the county rather than the prrm8n8nt 8ohool fund. Furthermom, 

roneye belonging to the paruarat rahool fund oanaot be 

upeaaod or used by the aountyo 

Under the fads submittrd, the Ccmlaeloners~ 

Cowt would roll Unit84 Stat08 Oovrraaeat bonds belongiag to the permanent school fund of the oountp at a diecount, thereby diminishing the permanent achool fund. It 

L8 our 

spL"I 

on that 8wh a proo@durs would br io vlol~- 

tioa 0r l ot1on 6 or Artio1, VII of the Con8tittltion or 

Tax08 * 

If, on tar other hand, thr gov8mamrat bonds IA 

quor~lm era sold at not 1888 than par,.ths Coam%881oa8xw~ 
lion. A. 0. Mueller, Page 3 (V-1089) 

Court would have authority under Article 2824 to invest 

the prooeede in bonds OS Independent eohool dlstrlcte. 

Slnoe Section 6 of Article VII of the Constitutlon of Texas makes the Comlasloners ( Oourts trustees of 

a permanent school fund of a county for the benefit of 

public 8ohoo18, It was held in 

100 Tex. 51, 93 Sew. 419 (1906 

Y v. Blackburq, 

I i I 

Court could not reduce the lnt x?f~L 

ISeVOn per oellt to thr80 per curt. 

In view of the foregoing, it ie our opinion 

that lt Is within the dlaoretlon of the Comi,esionersl 

Oourt to aetsmninb In vhat securlt;ies it ~111 Invest 

aoaeys be1 

“e; 

ing to the permanent sohool fund of the 

county. If he facts should show, however, (tonslderlng the interest rate and maturity date of the bonds) 

that the Commlaeioners I Court abused its discretion In 

Investing the moneya belong 

“& 

to the permwmnt echo01 

fund of the county and did no &llVBSt tlrfs ~Moneg for the 

benefit of the permanent school fund of the county and 

the county available school fund, it 18 our opinion that 

the CQllPaisslonerst Court ‘8 order would not be valid. 

You also ask if the Commissioners t Court would 

have the authority to sell United States Government bond8 

at a discount and purohase the Llano Independent School 

DietriOtS’ bond8 if the Llano Independent School Dietriot 

would gay the amount of the dlaaount neoessary to obtain 

the nomy on the government bonds. In answer to this 

qu8stion, we 0811 your attention to the provirrions of 

Artiak 2786 whloh would prohibit the Ll.ano Independent 

8choel Metriot from pagan& the dltaaount, einoe Artlols 

2786 pm&ibltr the who01 dietrlat f~oi selling its bond8 

at 1088 thaa par. 

The Cimmirebone;re t Court aannot eel1 

Uaftod States Oovsment bonds beloqjkng 

to ma prmenent rohool runa of the oouat 

at a diraouat. T*x.benst., Art.VII, Sea. z . 

It 18 within tke d&6@‘etlon of the Oom* 

8i88i 8’ Oort to deoi40 in what aee lti88 9”au T hstred by Arti,sle 28~4, V.C.S. 7 it 

ma’$v~oaeym bsWn&l~ ta the permanent 

e The U~8e~oll*lra’ 00~4 hold8 
c . 

Hon. A. Q. Mueller, page 4 (V-1089) 

moneys belonging to the permanent who01 

fund in trust for public schools, and cannot abuse this diBcretion. Delta Coun 

m 100 Tex. 51, 93 S.W. 419 (1 

APPROVED1 

J. C. Davie, Jr. 

County Affairs Division 

Sverstt Hutchlason 

Executive Assistant 

Char108 D. Mathews 

FirBt ABslst~at 

JR%mw 

Yours very truly, 

PRICE DANIEL 

Attorney General 

a>, , /-?Z? 

John Reevee 

Assistant 

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