Honorable Tom A. Craven

County Auditor McLennan County Waco, Texas

Dear Sir: OpinionNo. O-4412 Re: .Whetherschool district may use excess of,maintenance tax over 50#,on the $100.00 valuation for payment of debts created in prior years

We have .received your letter of recent date which we quote in part as follows:

"In order to qualify for State Rural ~' Aid, it.18 necessary for fifty cents:of the Rural:MaintenanceTax of a school to be used in caring for the rural aid needs of such school. Rulings from your department indicate thatany maintenanoe tax levied by a school over and above this required fifty centsmay be used for any legal purposes.
'"TheCounty Superintendent of McLennan County is, I think, using a too liberal interpretation of the 'term*legalpurpose* as a basis for approving certain common school d~istrict expenditures. My contention is that current local maintenance tax revenues are not eligible for the payment of debts incurred.duringprior years until the necessary expenses for the currentyear are satisfied. The local County Superintendent .ispaying out of currentlocal maintenance taxirevenues; and contendshe is legally~justifiedin doing sr.,~ debts incurred in prior years; which were,in excess of prior year budgets, to the exclusion of necessary current expenses~and, in some instances,when funds are not even available to pay teacherst salaries for the current gear."._... .- r?,

Honorable Tom A. Craven, page 2, O-4412

We quote from Sec. 2 of the Current Rural Aid Appropriation Bill (Acts 47th Leg., ch. 549):

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. . . .After the indebtedness in these funds; if any, has been retired the income from thils maintenance tax in excess of the required fifty cents (504)maintenance tax may be used at the discretionof the local school authorities of the district for any lawful schoolpurpose."

Your question resolves itself into the proposition whether that part of the maintenanoe tax levy of a school districtwhich is in excess of fifty cents on the $100.00 valuationmay be used to pay obligations of prior years.

Recently this department rendered OpinionNo. O-4257 dealingwith the payment of debts of a school distriot of one year with the revenues of a subsequentyear. We quote from that opinion as follows:

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. . . This departmenthas consistentlyheld that debts oreated by a schooldistriat in a certain yearwhioh create a defioiency inthe school fund for that year are in violation of law and createno olaim aga~inst the district. In otherwords.,the tnustees of a school district are not authorized to create a debt payable outof the revenues of~the distriot ,ofa subse-. quent year. OpinionsNo. o-4001, No. O-2231; Collierv..Peaoook, 54 S.W. 1025; Templeman Common School District v. Boyd B. Head Company 101 S.Y. (2d) 352; FirstNational Bank of Athens V. Murchison Independent School Dist., 114 S.W. (2d) 382; Rarlingen Independent School Mst. v. C.H. Page & Bro. 48 S.W. (2d) 983.

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. greater hand or

_ - . . .Debtsmay not begcontracted than the amount oftavailable funds on thatmay be reasonably enticipated for that school year. A debt created in excess of such amount is void and constitutesno claim against the district. Obligations,.expressly payable out of funds accruing to the ,districtin a~subsequent scholasticyear may not validly be created by the trustees of a.school district; such obligations are void and create~no liabilitywhatsoever

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Honorable Tom A. Craven,page 3, O-4412

on the part of the district. If in a previous year a debt was validly created in reasonable antioipationof revenues to be collected for that year,but the fund actually realizedwas insufficient to discharge the same, such debtmay be paid from the delinquent taxes of such previousyear or yearsprior thereto. **Such** a debt cannot be paid from the revenues of a subsequentyear, at least unless there is an actual surplus in the fund after the discharge of all the obligationsof such subsequentyear;however, as there Is no such surplus in the fund of the school district involved, it isnot necessary for us to pass upon this point, and we express no opinion thereon."
in We are of the opinion that the cases cited minion No. O-4257 are applicable to a school distriot whether ornot it leviesmore than a fifty cent maintenance tax, that the same limitationsare present with respect to the funds of the district realized from a .maintenancetax of more than fifty cents,and that the principlesannounced in OpinionNo. O-4257 are the~refore, applicable to the subjectmatter of your inquiry. It follows that an expenditure of school funds in violation of such principleswould not be for a lawful purpose. We enclose a copy of OpinionNo. O-4257 for your consideration.

Very truly yours
ATTORNEY GENERAL OF TEXAS
s/ George W. Sparks Approved Feb. 24, 1942 m George W. Sparks Assistant s/ Grover Sellers
First Assistant' Attorney General Approved Opinion Committee By BWB, Chairman GWS:ff/cg