Honorable 

Chairman 

Committee 

February 12, 1990 

Hugh Parmer Opinion No. JM-1142 

on Inter- Re: Types of retirement plans 

governmental Relations that appraisal districts may 

Texas State Senate offer their employees 

P. 0. Box 12068 (RQ-1778) 

Austin, Texas. .78711 

Dear Senator Parmer: 

We understand you to ask essentially two questions. 

First, you ask us to specify the types of retirement plans 

that an appraisal district may offer its employees. Second, 

you wish to know what will be the income tax consequences to 

individual appraisal district employees and the proper 

method of disbursing funds held in any retirement plans in 

the event that any plans already in place were entered into 

improperly. 

Your opinion 'request is prompted.by. the issuance of 

Attorney General Opinion JM-1068 (1989), which concluded 

that appraisal districts were without authority to enter 

into certain contracts providing retirement plans for 

appraisal district employees. We construed the question 

submitted in that request to ask whether an appraisal 

district had the authority to create a local retirement 

system, authority similar to that conferred on incorporated 

cities and towns by V.T.C.S. article 6243k and on counties 

by V.T.C.S. article 62283. Because no statute confers 

explicit authority on appraisal districts or, for that 

matter, on any other sort of.special.district to create such 

a local system, we concluded that no such authority 

existed.1 The opinion apparently has been misconstrued to 

1. This opinion should not be construed to call into 

question the legitimacy of a plan authorized by special law 

creating a special district. 

P. 6012 
Honorable Hugh Panner - Page 2 (JM-1142) 

hold that subsections (b), (c), and (d) of secti.on 67 of 

article XVI of the Texas Constitution sets forth the 

exclusive list of the retirement plans that political 

subdivisions may provide for their employees. However, we 

did not so hold; rather, we held that there was no statutory 

authority to create the sort of system about which we 

understood the reguestor to inquire. 

We will answer your first question in three parts. We 

will discuss first the legislative history and proper 

construction of section 67 of article XVI of the Texas 

Constitution. Then we will specify those retirement plans 

or systems in which appraisal districts are authorized by 

Texas statute to participate. Then we will discuss whether 

appraisal districts have imnlied authority to create Iocal 

systems, authority analogous to that explicitly conferred by 

V.T.C.S. articles 6243k and 62283 on incorporated cities and 

counties, respectively. 

I 

:: Section 67 of'article XVI of the Texas Constitution 

provides:in pertinent part: 

(a) General Provisions. (11 The leaislature mav enact aeneral laws establishinq 

> s ste s an 

*: 

ement nd 

related ; is b' enefits for 

.public : Financing of 

benefits must be based on sound actuarial 

principles. The assets of a system are held 

in trust for the benefit of members and may 

not be diverted. 

. . . . 

(4) General laws establishing retirement 

systems and optional retirement programs for 

public employees and officers in effect at 

the time of the adoption of this section 

remain in effect, subject to the general 

powers of the legislature established in this 

subsection. 

[(b) State Retirement Systems.] 

. . . . 

p. 6013 
Honorable Hugh Parmer - Page 3 (JM-1142) 

(c) Local Retirement Systems. (1) The 

legislature shall provide by law for: 

(A) the creation by any city or county of 

a system of benefits for its officers and 

employees; 

(B) a statewide system of benefits for 

the officers and employees of counties or 

other political subdivisions of the state in 

which counties or other political 

subdivisions may voluntarily participate; and 

(C) a statewide system of benefits for 

officers and employees of cities in which ..~ 

cities may voluntarily participate. 

. . . . 

(e) Anticipatory Legislation. Legislation 

enacted in anticipation of this ,amendment is 

not voids because it is anticipatory. 

(Emphasis added.) 

Section 67 was enacted at the same time that several 

other sections of the constitutions were repealed. Acts 

1975. S.J.R.~ 3~.2 The ,Bill Analysis prepared. for,S.J.,R. No. 

3 stated: 

2. Section 48a of article III, adopted in 1936, and 

granted the legislature the authority to establish a 

retirement fund for employees of public schools, colleges, 

and universities. S.J.R. 18, Acts 1935, 44th Leg., at 1219. 

Section 48b of article III, adopted in 1965, created in the 

constitution.the Teachers, .Retirement System. S.J.R. 27, 

Acts 1965, 59th Leg., at 2201. 

Section 51e of article III, adopted in 1943, permitted 

incorporated cities and towns to create municipal retirement 

systems Andy disability pensions. H.J.R. 8, Acts 1943, 48th 

Leg., 5 1, at 1142.,, Section 51f of article III, also 

adopted in 1943, permitted the legislature to provide for a 

statewide system of retirement and disability benefits for 

municipal officers and employees. H.J.R. 8, Acts 1943, 48th 

(Footnote Continued) 

p. 6014 
Honorable Hugh Parmer - Page 4 (JM-1142) 

The proposed amendment is similar to the 

proposal which was overwhelmingly approved 

during the 1974 Constitutional Convention. 

The proposal combines the various detailed 

provisions in the present constitution into a 

more concise provision, eliminates rigidities 

which required constitutional amendments 

each time the Legislature sought to improve 

retirement benefits, and strengthens 

protections for members of existing systems. 

The amendment enacting section 67 accomplished two 

broad objectives. First, subsection (a) of section 67 was a 

grant of authority, conferring very flexible power on the 

legislature to establish retirement and disability systams. 

The uSection-by-Section Arialysis": in the Bill Analysis of 

Senate Joint Resolution No. 3 describes subsection (a), in 

relevant pa*, in the following way: 

Subsection (a)(l) authorizes the Legislature to establish systems and', programs of 

retirement and related disability and death 

benefits for public employees. mi arant of 

s' 

provisioki whT:L 

flexible thans present 

authorize specific systems 

in very narrow terms and gives constitutional 

status to whateversvstems -or nroarams the 

(Footnote Continued) 

L---v. I 5 1, at 1142. 

Section 62 of article XVI, adopted in 1946, authorized 

the legislature to create system of retirement, 

disability, and death benefit: for state officers and 

employees. It also authorized each county to create such a 

system for its officers and employees with the.approval of a 

majority of voters of the county. H.J.R. 10, Acts 1945, 

49th Leg., at 1045. 

And finally,. section 63 of article XVI, adopted in 

1953, provided that 'qualified.; members of then Teacher 

Retirement System were entitled to service credit for time 

earned while they were working for the state and, similarly, 

that qualified members of 'the state Employees Retirement 

System were entitled to credit for time earned while they 

were teachers. S.J.R. 6, Acts 1953, 53rd Leg., at 1169. 

p. 6015 
Honorable Hugh Parmer - Page 5 (JM-1142) 

Maislature mav create subject to the 

following general requirements: 

(a) benefits must be based on sound 

actuarial principles -- a new requirement 

which places a new level of fiscal and 

fiduciary responsibility on the Legislature 

and the administrative bodies which manage 

the systems. 

(b) funds or assets of the systems are to 

be held in trust for the members of the 

systems and cannot be diverted for any 

purpose other than the benefit of the members 

-- a new requirement which protects the funds 

from being used for non-retirement purposes. 

(Emphasis added.) 

Bill Analysis, S.J.R. 3, 64th Leg. (1975). 

The legislature has created a variety of retirement and 

disability plans for public employees that subsection (a)(l) 

would sanction. See. e.a V.T.C.S. arts. 6243a-1, 

62436-1, 6243e, 6243e.1, 6143e.2, 

6343b, 

6243e.3, 6243e-2, 6243e-3, 

6243f, 6243f-1, 6243g, 6243g-1, 6243g-3, 62433 (setting 

forth provisions 'permitting the creation of, various 

retirement programs for firemen, policemen, and municipal 

employees'under certain circumstances).3 The legislature 

also has ~enacted several statutes permitting political 

subdivisions to establish various retirement or deferred 

-. 

3. Several of the above-listed statutes were enacted 

prior to the adoption of section 67 of article XVI: indeed, 

several were enacted prior to the adoption of the 

constitutional amendments that section 67 was intended to 

replace. Subsection (a)(4) of section 67 provides the 

following: 

General laws establishing retirement 

systems and optional: retirement programs for 

public employees and officers in effect & 

the time of the ado&ion of this section 

remain in effect, subject to the general 

powers of the legislature established in this 

subsection. (Emphasis added.) 

p. 6016 
Honorable Hugh Parmer - Page 6 (JM-1142) 

compensation plans that receive favorable tax treatment 

under the Internal Revenue Code. These statutes will be 

discussed in Part II of this opinion. 

In addition to the conferral of flexible authority set 

forth in subsection (a) of section 67, subsections (b), (c), 

and (d) direct the legislature to establish or retain 

certain retirement systems.4 Subsection (c), the subsection 

with which you are concerned, directs the legislature to 

provide for the creation of local systems by any city or 

county and to create two statewide systems, one for county 

and district employees and one for municipal employees, in 

which participation is voluntary. 

The "Section-by-section Analysis" of the bill analysis 

describing subsection (c) contains the following: 

Paragraphs (l), (2), and (3) of subsection 

(c) require the Legislature to provide for 

(a) the creation of separate local systems by 

cities and counties, (b) a statewide system 

of benefits in. which counties or other ,. 

political subdivisions can participate on a 

voluntary basis, and (c) a statewide 

municipal system in which towns and cities 

can participate ona voluntary basis. The 

present prohibition '-: against legislative 

appropriations for local retirement systems 

has been deleted.,; The requirement that the 

creation of separate local systems by cities 

and counties must be approved by the voters 

thereof has also been deleted. Since 

subsection deletes direct arants of authoritv 

enablina municinalities and counties to 

t es abl's t eir ow retirement 

plans, the Leaislature m v need to enact 

enablina leaislation to rezlace Article III, 

4. Subsection (b) of section 67, intended essentially 

to replace sections 48a and 48b of article III and sections 

62 and 63 of article XVI, directs the legislature to create 

state retirement and disability systems for teachers, state 

officers, and employees. Subsection (d) of section 67 

directs that the legislature retain the system already in 

place for the state's judiciary. 

p. 6017 
Honorable Hugh Parmer - Page 7 (JM-1142) 

Section 51e. and Article XVI. Section 62(b), 

of the nresent onstitution. Other details 

that have beenC deleted exist in present 

statutes. (Emphasis added.) 

Bill Analysis, S.J.R. 3, 64th Leg. (1975). 

Pursuant to subsection (c)(l), the legislature enacted 

V.T.C.S. articles 6243k and 6228j, which conferred on 

incorporated cities and counties, respectively, the 

authority to create local systems.5 Pursuant to subsection 

(c)(2), the legislature enacted what is now codified as 

subtitle F of title 8 of the Government Code, creating the 

statewide Texas County Andy District Retirement System in 

which counties and special districts may voluntarily 

participate.~ And, pursuant,. to-, subsection (C) (3), the 

legislature enacted what is now codified ,a8 subtitle G of 

title 8 of the Government Code, creating a statewide Texas 

Municipal Retirement System in which incorporated cities 

voluntarily may participate. 

~Thus, while, section67 of' article.:XVI does direct the 

legislature to establish, certain retirement and disability 

systems, it also grants broad authority to the legislature 

5. Articles 62283 and .6243k, V.T.C.S., were "~ enacted 

in.1975: .Acts 1975, 64th Leg., ch.'426,~ at 1127. Sections 

3 and 4 of that bill provided: 

Sec. 3. Retirement, disability, and 

death benefit systems or programs created 

under the authority of Article III, Section 

51-e, or Article XVI, Section 62, Subsection 

(b) s of the Texas Constitution, or under the 

general powers of home-rule cities, remain in 

effect, subject to power granted by law to 

alter or abolish the systems. 

Sec. 4. This Act takes effect on 

adoption by the qualified voters of this 

state of S.J.R. No. 3, 64th Legislature, 

Regular Session. 

The amendment enacting section 67 was adopted at an election 

held on April 22, 1975. 

p. 6018 
Honorable Hugh Parmer - Page 8 (JM-1142) 

to establish other retirement and disability systems for 

public employees. It does not set forth any exclusive list' 

of the the retirement and disability systems that could be 

established for public employees and Attorney General 

opinion JM-1068 did not so hold. We now turn to those 

pension plans or retirement systems in which appraisal 

districts are authorized by Texas statute to participate. 

II 

The legislature by statute has created or authorized 

the creation of several pension plans or retirement systems 

in which appraisal districts may choose to participate. 

Article 695g, V.T.C.S., authorizes political subdivisions, 

including appraisal districts, to participate In the fed.eral 

Social Security .programr' Attorney.~ General Opinions S-152~ 

(1955): S-19 (1953); V-1198 (1951). And,~ as was pointed out 

in Attorney General Opinion JW-1068, appraisal districts are 

authorized to participate in the statewide County and 

District Retirement System. Gov#t~Code.§ 842.001. 

Additionally, the legislature hasauthorized political 

subdivisions, including appraisal, districts, to establish 

programs that receive favorable tax treatment as "deferred 

compensation10 plans for purposes of subchapter D of 

1 of the Internal Revenue Code.6 

chapter 

Article 6252-3e, 

V.T.C.S., 7 enacted in 1989, permits political subdivisions 

in the : state, including appraisal districts, to create 

deferred compensation plans that meet the criteria.'of 

section 401(k) of the Internal Revenue Code. And article 

6252-3f, V.T.C.S., also enacted in 1989, permits political 

subdivisions in this 'state, including appraisal districts, 

to create deferred compensation plans that meet the criteria 

of section 457 of the Internal Revenue Code.8 

6. For purposes of the Internal Revenue Code, pension 

plans, profit-sharing plans, stock bonus plans, as well as 

deferred compensation plans under state law, are considered 

"deferred compensation" plans. 

7. We note that two different statutes have been 

designated "article 6252-3e.l' 

8. We note that both V.T.C.S. articles 6252-3e and 

(Footnote Continued) 

P. 6019 
Honorable Hugh Parmer - Page 9 (JM-1142) 

There is no statute, however, that confers on appraisal 

districts the authority to create local pension systems that 

is analogous to the authority conferred on incorporated 

cities and towns by V.T.C.S. article 6243k9 and on counties 

(Footnote Continued) 

6252-3f are repealed, effective September 1, ,1990, to be 

replaced by V.T.C.S. article 6252-351. With the enactment of 

these statutes, V.T.C.S. article 6252-3b, which was ~enacted 

in 1972 and which permitted any political subdivision to 

create a deferred compensation plan for its employees and 

authorized the purchase of insurance and annuity contracts 

and mutual fund contracts, was repealed. Acts 1989, 71st 

Leg., ch. 147, 5 4, at 522. 

9. Article 6243k, V.T.C.S., provides the following: 

An incorporated city or town may create a 

retirement, disability, 

system for its 

and ~,death. benefit 

appointive officers and 

employees if a majority of the qualified 

voters of the city or town voting on the 

propositions approve the creation at an 

election called for that purpose. Each 

member of the system shall contribute to the 

system an amount determined by the city or 

town, which may not exceed 10 percent of the 

member's annual compensation paid by the city 

or town, and the city or town shall contribute for each member an amount that at least 

equals but is not more,than twice the amount 

of the member's contribution. A member of a 

municipal system is eligible for disability 

benefits if he is disabled in the course of 

his employment with the city or town. A 

member is eligible for retirement benefits if 

he is 65 years old or older, or he is 60 

years old but less than 65 years old and has 

(Footnote Continued) 

p. 6020 
Honorable Hugh Parmer - Page 10 (JM-1142) 

by V.T.C.S. article 6228j10, which were enacted pursuant to 

subsection (c)(l) of section 67 of article XVI of the Texas 

Constitution. It is argued, however, that appraisal 

districts have the _imDlied aUthOrity t0 create such local 

systems. It is to these arguments that we now turn. 

III 

While home-rule cities are held to have the full power 

of self-government, counties and special districts are not. 

In other words, home-rule cities have full authority to do 

anything that the legislature could authorize them to do; 

accordingly, home-rule cities look to the acts of the 

legislature, not for grants of power, but only for 

limitations on their powers. Tex. Const. art. XI, 5 5; 

Local Gov't Code ch. 51; State ex rel. Rose V. Citv of ha 

(Footnote Continued) 

been employed by the city or town for 25 

years or more. 

10. Article 62283, V.T.C.S., provides the following: 

(a) A county may create a retirement, 

disability, and death benefit system for its 

appointive officers, and employees if a 

majority of the qualified voters of the 

county 'voting on the proposition approve the 

creation at an election called for that 

purpose and advertised in at least one 

newspaper of general circulation in the 

county once a week for four consecutive weeks 

before the election is held. Each member of 

a system shall contribute to the system an 

amount determined by the county, but not more 

than five percent of the member’s annual 

compensation paid by the county. The county 

shall contribute for each member an equal 

amount. 

(b) The assets of a county system, after a 

sufficient portion is set aside each year to 

pay benefits as they accrue, shall be 

invested in bonds issued or guaranteed by the 

United States, this state, or counties or 

cities of this state. 

p. 6021 
Honorable Hugh Parmer - Page 11 (JM-1142) 

Porte, 386 S.W.2d 782 (Tex. 1965); Jones v. Int'l Ass#n 

Firefiahters Local Union No. 936, 601 S.W.2d 454 (Tex. Civ. 

APP. - Corpus Christi 1980, writ ref'd n.r.e.). 

Counties and special districts, on the other hand, look 

to the legislature for grants of power. 

special district 

A county or a 

exercises only such powers as have been 

expressly delegated to it by the constitution or the 

legislature or which exist by clear and 

implication. 

unquestioned 

See, Canales v. Lauahlin, 214 S.W.2d 451 (Tex. 

1948); Tri-CitV Fresh Water SUDD~V Dist. No. 2 of Harris 

COUntV V. Mann, 142 S.W.2d 945 (Tex. 1940); Franklin Countv 

Water Dist. v. Majors, 476 S.W.Zd 371 (Tex. Civ. App. - 

Texarkana 1972, writ ref'd n.r.e.) (a special district can 

do only',that. which is 

it),. -.. .,. s 

authorized by the statute .creating 

Nevertheless, several arguments have been adduced in 

supportof the proposition that, in addition to or instead 

of those retirement and disability plans discussed in Part 

II of this opinion, appraisal districts have the wimplied" 

authority to create.local retirement and disability systems. 

We find none of the arguments persuasive. 

The first such argument is 

districts have the authority to 

that because appraisal 

llcompensatet* their employees 

pursuant to section 6.05(d):,of the ,Tax Code and because 

retirement and disability plans constitute a part of 

%ompensation, "11 they have implied authority to. establish 

11. In Bvrd v. CitV of Dallas, 6 S.W.Zd 738 (Tex. 

1928); the Texas Supreme Court upheld the constitutionality 

of a statute authorizing pensions for city police and fire 

department personnel.~ Those challenging the statute argued 

that the granting of pensions to persons who were no longer 

employed by a political subdivision violated the state 

constitutional prohibition against granting public funds for 

private purposes. The court disagreed, holding that such a 

benefit constituted part of the compensation for which 

employees contracted. 

This case stands for the proposition that a statute 

permitting the ~creation of a pension system does not violate 

the constitutional prohibition against granting public 

(Footnote Continued) 

p. 6022 
Honorable Hugh Parmer - Page 12 (JM-1142) 

local retirement and disability systems, apparently without 

restriction. Indeed, it is argued, in the words of one 

brief submitted in connection with this request, that 

ziyf,i;a; districts have authority to create plans "as they 

We disagree for several reasons. 

First, statutes are not to be construed in such a way 

as to impute to the legislature a foolish, useless, or vain 

thing. State ex rel. Childress v. School Trustees of Shelbv 

County, 239 S.W.Zd 777 (Tex. 1951); Dovalina v. Albert, 409 

S.W.2d 616 (Tex. Civ. App. - Amarillo 1966, writ ref'd 

n.r.e.). The governing bodies of counties, cities (both 

home-rule and general law), school districts, and special 

districts are empowered, either by the constitution or by 

statute, to %ompensatem employees. If a conferral of 

explicit authority to the governing body of a political 

subdivision to llcompensatell public employees necessarily 

entailed the implied authority to offer those employees any 

retirement plan that the governing body saw fit, then the 

legislature's enactments of the statutes set forth in Part I 

of this opinion were useless, superfluous acts. Indeed, the 

legislature's adoption of all of those statutes set forth 

originally as title 109 of the,Revised Civil Statutes of 

Texas, recodified in 1981 as title 1lOB and finally 

recodified in 1989 as title 8 of the Government Code, 

statutes dating back to 1909 and 'through 1989, would have 

been superfluous. While some~persons may have assumed that 

political subdivisions have the implied authority to offer 

to their employees' any retirement plan that they so. choose, 

legislatures going back to almost the turn of the century 

evidently have not. 

Second, the argument that appraisal districts have the 

implied authority to offer their employees any retirement 

plan that they so choose would produce an absurd result. It 

would mean that, while counties, cities, and school 

districts are governed by and limited to those statutes that 

the legislature has enacted over the years regarding 

retirement plans, appraisal districts have unrestricted 

power to do whatever they want. Moreover, it would also 

(Footnot;aCoiziued) 

funds: not stand for the proposition ~that a 

political subdivision has the implied authority to create a 

local pension system. 

p. 6023 
Honorable Hugh Parmer - Page 13 (JM-1142) 

mean that those safeguards and protections designed to 

vouchsafe the interests of participating employees and those 

limitations upon inves'tments set forth both in section 67 of 

article XVI and in the statutes that authorize the creation 

of various pension plans or retirement systems would not be 

applicable, since those provisions govern plans and systems 

enacted by general law. e. a Attorney General 

Opinions MW-570, MW-506 (198;:; &-ii2 (1980) (opinions 

construing statutory limitations on investments designed to 

afford protection to participants). Nor is it at all 

certain whether retirement plans created absent explicit 

statutory authority would be protected under the Texas Trust 

Act, which governs the administration of private trusts. 

See CreDs v. Board of Firemen's Relief 8 Retirement Fund 

Trustees of Amarillo, 456 S.W.2d 434 (Tex. Civ. App. - 

Amarillo 1970, writ ref'd n.r.e.). We know of no reason why 

the legislature would intend such a result.12 

And third, interpretation by implication is permissible 

only when it is necessary; the argument that a special 

district has tinlied authority to 'do..a thing"is inapposite 

in an instance in which it is given specific'authcrity to do 

, Cre a r v -Hidala; Countv Water Imorove283aS:W. ‘151 (Tex. Comm'n App. 1926, 

alle v. Citv of Austin, 22 S.W. 668 (Tex. 

1893). Indeed, invoking a common rule of statutory construction, 'it could well be argued that those statutory plans or 

systems enacted'by the legislature should be read to exclude 

any others. See Weaver v. ,Robison, 268 S:W. 133 (Tex. 

1924); Poster v. Citv of Waco; 255 S.W. 1104 ,(Tex. 1923); 

Attorney General Opinion H-604 (1975) (holding thE",,,Ezz 

method set forth in V.T.C.S. article 62289, which 

the County and District Retirement System and detailed the 

way in which a political subdivision could contribute to the 

system, was exclusive). As we pointed out in Part II of 

this opinion, special districts, including appraisal 

districts, that are not authorized explicitly to create a 

local retirement system may choose to do one or more of the 

12. For this same reason we reject the argument that 

all political .-subdivisions have the implied authority to 

create whatever pension plan or retirement system that they 

so choose and that all of the constitutional amendments and 

statutes enacted by the legislature are merely limitations 

on that implied authority. 

p. 6024 
Honorable Hugh Parmer - Page 14 (JM-1142) 

following: participate in the federal Social Security 

system, participate in, the state-wide County and District 

Retirement System, or adopt one of the deferred compensation 

plans authorized by statute. We need not strain to find an 

implied power when the legislature has conferred specific, 

though limited, powers. 

It is also argued that Attorney General Opinions M-836 

(1971) and WW-215 (1957) and Lower-Colorado River Auth. v. 

Chemical Bank & Trust Co., 185 S.W.2d 461 (Tex. Civ. App. - 

Austin 1945). aff'd 190 S.W.Zd 48 (Tex. 1945) 

-1 support the argument that appraisal 

lhereinafter 

districts have 

implied authority to create a local pension plan. We think 

that reliance on these authorities is misplaced. 

Attorney General Opinion M-836 concluded that" the' 

Sabine River Authority had the implied power to enter into a 

deferred compensation and pension plan based upon its 

explicit authority to employ and fix the compensation for 

those executives and employees as is necessary to carry out 

the functions and duties of the authority. That opinion 

relied upon :v.; 151 

S.W.2d 570 (Tex. 1941), m 154 S.W.2d 659 (Tex. ,Civ. 

APP. - Fort Worth 1941, no writ) [hereinafter. Friedman], 

Hvrd V. Citv of Dallas. 6 S.W. 2d 738 (Tex. 1928) 

[hereinafter m], and Attorney General Opinion WW-215. The 

latter opinion also relied upon Friedman in support,of ' the 

proposition that the Port ~Isabel-San Benito Navigation 

District had the implied power to provide certain benefits,'~ 

including pension benefits, to its employees. 

For three reasons, we do not think that the two court 

opinions are controlling. First, both Friedman and, && 

concerned whether specific statutes enacted by the 

legislature, one authorizing the creation of pensions for 

city police and firemen and the other creating a Texas 

Employment Compensation Fund, violated specific provisions 

of the Texas Constitution. In both cases, the Texas Supreme 

Court upheld the challenged statutes, concluding that the 

benefits that each provided should be considered a part of 

the compensation that employees earned, rather than a 

gratuity conferred. Neither case stands for the proposition 

that a political subdivision has any implied power. 

Second, the holdings of these two opinions cannot be 

reconciled with other attorney general opinions, issued both 

prior and subsequent to the issuance to these opinions, that 
Honorable Hugh Parmer - Page 15 (JM-1142) 

do not find any implied authority to create or participate 

in retirement systems, absent explicit statutory authority. 

See, e.a., Attorney General Opinions H-903 (1976); H-604 

(1975); C-581 (1966); WE-283 (1957). Nor can they be 

reconciled with those opinions that strictly construe 

authority conferred and find no implied power to provide 

benefits generally, absent explicit statutory authority. 

See e.a Attorney General Opinions JR-887 (1988); JR-543 

(1986); ‘;M-406 (1985) ; JR-143 (1984); ME-592 (1982); H-535 

(1975); WW-1373 (1962). 

Third, the holdings of these two opinions cannot be 

reconciled with the strict construction evidently given 

section 62 of article XVI. When it was adopted in 1946, 

subsection (b) of section 62 provided in relevant part .that 

"[E]ach county shall have the right to provide for and 

administer a Retirement, Disability and Death Compensation 

Fund for the appointive officers and employees of the 

county . . . .It The subsection made the creation of such a 

fund contingent upon the approval of a majority of the 

qualified voters of the a county. 

In 1958 the voters rejected an amendment to section 62 

of article XVI of the Texas Constitution that would have 

expanded the scope of the section to include officers and 

employees of precincts.' S.J.R. 6, Acts 1957, 55 Leg., at 

1631. Even more, significantly, in 1962 the voters of Texas 

defeated an amendment to subsection (b) to expand its scope 

to include "[e]ach county nd anv 

Ha&R. 

other oolitical 

subdivision of this State." 36, Acts 1961, 57th 

WJ., at 1314 (emphasis added). Subsection (c) of section 

62 was added in.1966, which authorized the legislature to 

provide a pension plan "for all the officers and employees 

of a county or other nolitical subdivision of the State." 

S.J.R. 4, Acts 1965, 59th Leg., at 2190. It was only after 

this amendment was adopted and pursuant to this 

authorization that the legislature created in 1967 the 

statewide County and District Retirement System. Acts 1967, 

60th Leg., ch. 127, at 240 (codified originally at V.T.C.S. 

article 6228g and now codified at subtitle F of title 8 of 

the Government Code). Clearly,,neither the legislature that 

proposed the 1958 and 1962 amendments nor the voters that 

defeated them assumed that the implied power to create 

pension systems existed; if they had, the amendments would 

have been superfluous. 

Both Attorney General Opinions M-836 and WE-215 

contained faulty reasoning and relied upon authorities that 

p. 6026 
Honorable Hugh Parmer - Page 16 (JM-1142) 

do not support the proposition for which they were cited. 

Accordingly, Attorney General Opinions M-836 and WW-215 are 

hereby overruled. 

In m, the court of civil appeals considered, inter 

a, whether the LCRA had the implied power to increase the 

compensation that it paid its officers and employees by four 

percent and then set aside the four percent in a segregated 

fund for the purpose of providing a pension or retirement 

plan for those officers and employees. The court held that 

it had the implied power, based in part upon its explicit 

statutory power to compensate employees. For two reasons, 

we conclude that m does not control your question. 

First, keeping in mind'.that the purpose of the LdXA, 

which is in part to provide electric power to consumers in 

much the same way that'an investor-owned utility does, it is 

significant that the court employed the following rationale 

to support its conclusion: 

While designated and classified 

governmental agency and body politiz 

a .., 

and 

corporate;- the Authority's' functions and 

activities partake, in large measure the 

nature and characteristics, within 

legislative restrictions, of a large 

industrial enterprise, rather than of a 

strictly governmental .function. It has 'no 

power' to levy taxes," enact laws nor 

ordinances, as a city has; and its efficient~ 

functioning depends in large measure on the 

sound judgment and good business management 

of its Board of Directors. They have large 

control over the operation of its properties, 

and the income to be derived therefrom, which 

constitute the only source of revenue to meet 

its obligations. Of necessity matters 

relating thereto must be left in large 

measure to their judgment, experience and 

discretion; and obviously could not be 

prescribed ,in detail"by law. 

. . . . 

Retirement pay from funds ,~accumulated 

through the co-operative efforts of employer 

and employee are now well-established 

business practices among practically all 

p. 6027 
Honorable Hugh Parmer - Page 17 (JM-1142) 

large industrial enterprises; and are being 

increasingly applied by national, state and 

municipal governments. Typical instances are 

civil service employees, postal employees, 

fire and police employees, etc. 

185 S.W.2d at 467. 

The court clearly felt that the LCRA was not simply a 

political subdivision; indeed, the Texas Supreme Court 

decision that affirmed the w judgment of the court of 

appeals held for the first time that the LCM was tax exempt 

from ad valorem taxes as a political subdivision. Whatever 

else may be said,about appraisal districts, they are not 

analogous to industrial enterprises. 

We acknowledge that the public policy reasons that 

impelled the court to conclude that the LCRA had an implied 

power to create pension systems can apply equally to the 

creation.of pension. systems for every sort of political 

subdivision: namely that such plans may encourage employees 

to remain so employed,~,with the result that there is less 

rnzloyee turn-over, better service to the general public 

ultimately less cost to the public. But it needs to be 

rem&bered that, at the time that m was handed down, no 

other sort of pension system or plan wasp available to the 

employees of'the LCRL An d it should also be remembered 

that the court itself admitted that, while,pension systems 

for employees had become nwell-established business 

practices" among practically all large industrial 

enterprises," it was only l@increasingly applied" to public 

employees. The force of the rationale that impelled that 

court to create an implied power in 1945 is greatly weakened 

in 1990 in the face of the fact that the legislature 

explicitly has made provision for the retirement benefits of 

special district employees. 

Second, for the reasons set forth in the discussion 

above regarding Vompensationl' and implied power, it is 

obvious that the legislature has not assumed that, whatever 

the ICRA might have implied power to do, all special 

districts have identical implied powers. If such were the 

case, again, virtually all of the legislation enacted in 

this area would be unnecessary and superfluous. a may 

stand for the proposition that the ICRA has the, implied 

power to create a pension system for its officers and 

employees: it does not stand for the proposition that 

special districts generally are so empowered. 

P- 6028 
Honorable Hugh Parmer - Page 18 (JM-1142) 

Instructive in this regard is Attorney General Opinion 

V-569 (1948), in which the state auditor asked whether a 

list of 31 special districts were authorized to participate 

in the Employees Retirement System of Texas. All of the 

districts were created pursuant to section 59 of article XVI 

of the Texas Constitution. The opinion discusses the &Q& 

case and sets forth essentially the same quotation set forth 

above, describing the LCRA8s functions and power, before 

concluding that its employees were not authorized to 

participate in the Employees Retirement System, based upon 

the statutory definitions of l'employeell and tldepartment" 

that govern participation in the retirement system. In 

spite of the fact that the LCRA had been held to be an 

agency of the state in b $ lo ad 

McGraw, 83 S.W.2d 629 (Tez. 1935) the opinion concluded 

that LCRA employees were not ~empl~yees of the State" for 

purposes of the retirement system. Reasoning by analogy, 

the opinion held that employees of conservation and 

reclamation districts were not llemployees of the State" for 

purposes of the retirement system either. Curiously, the 

opinion referred to the "apparent" authority of the LCRA to 

create its own retirement system, but failed to state that 

conservation and reclamation districts possessed the same 

power: 

We note here that from reading Lower 

Colorado River Authority v. Chemical Bank and 

Trust Co., supra, the L.C.R.A. apparently has 

its own retirement system. In any event, the 

employees of this particular district would 

be precluded from membership in the system 

afforded by H. B. 168 [the Bmployees 

Retirement System of Texas], by reason of 

Section l.c., of H. B. 168 which defines 

'employee.' 

We are, therefore, of the opinion that the 

employees of the conservation and reclamation 

districts named in your reguest are not 

eligible for membership in the Employees 

Retirement System of Texas. 

Id. at 7. 

The reason for the apparent failure of the legislature 

specifically to provide for the inclusion of special 

districts in the statewide plan for counties until 1967 

probably stems from the fact that the proliferation of 

p. 6029 
Honorable Hugh Parmer - Page 19 (JM-1142) 

special districts in Texas is a comparatively recent 

phenomenon. As recently as February 1959, there were an 

estimated 524 special districts in Texas. Of these, 115 

were authorized by local law and 409 were created under some 

13 general laws governing water districts. See w. 

Thrombley, Special Districts and Authorities 

Institute of Public Affairs, 

in Texas, 

University of Texas at Austin 

(1959). By 1979 there were over 420 special districts in 

Harris County alone. We think it significant that in a 

treatise on public employee retirement in Texas written in 

1955, no mention is made of any implied authority of special 

districts to create local pension systems, nor is mention 

made of the LcRA case. See Swanson 8 Miskell, Public 

Employment Retirement in Texas, 

University of Texas at Austin 

Institute of Public Affairs, 

(1955). Indeed, the .only 

reference to any so* of retirement system for specialsdistricts in this 1955 treatise is the federal Social 

Security program. Id. at Table XIV, part III, at p. 91; 

Threes other arguments have been adduced, each, relying 

upon misconstrued ore ~misunderstood 

provisions, 

specific statutory 

in support of the "implied power" theory.' The 

first maintains that the facts that participation in the 

County and District Retirement System is voluntary and that 

the System's board must approve any such participation by a 

special district, Gov't Code 0 842.001(c), necessarily mean 

that special districts have the implied authority to create. 

their own local pension systems. 

This argument is faulty in two respects. 

ignores the authority conferred by statute to 

One; it 

create 

deferred compensation plans and to participate in the 

federal Social Security program. And two, it wrongly 

presupposes that a retirement plan has to be offered to 

employees in the first instance. In other words, it assumes 

that the only choice a special district has is either to 

participate in the County and District Retirement System or 

to create a local pension system analogous to those 

authorized by V.T.C.S. articles 62283 and 6243k. 

In fact, neither federal nor state law requires a local 

political subdivision to create a pension plan. The federal 

Employee Retirement Income Security Act of 1974, 29 U.S.C. 

§§ 1001 et sea. (llERISAn) does not ,govern local political 

subdivisions. Attorney General Opinion H-618 (1975); 29 

U.S.C. 5 1003(b). And no provision in state law requires 

local political subdivisions, except independent school 

p. 6030 
Honorable Hugh Parmer - Page 20 (JM-1142) 

districts, to make participation in a retirement program 

available to its employees: participation is voluntary. 

For example, in Attorney General Opinion H-1122 (1978), 

this office held that a municipality that chooses to exempt 

itself from the operation of V.T.C.S. article 6243e, which 

governs retirement systems for volunteer fire departments, 

is not required to create an alternate retirement system. 

In Attorney General Opinion H-903 (1976), in answer to a 

question asking whether employees of a hospital whose 

administration had been taken over by the county were 

authorized to establish their own pension plan, this office 

held that employees became automatic members of County and 

District Retirement System if the county was already 

participating in the system or the county could elect to 

discontinue participation in the statewide system and create 

a local one pursuant to V.T.C.S. article 62285. No other 

alternative was available. Thus, in an instance in which a 

special district is not authorized explicitly by statute to 

create a pension plan, it may only do one or more of the 

following: adopt a'deferred compensation plan pursuant -to 

statute, participate in the federal Social Security program, 

again by statute, or participate in the County and District 

System. Or it may offer nothing at all. 

The next argument misconstruing specific statutory 

provisions asserts that the existence of_ what .,is now 

codified as section 842.006 in the Government Code amounts 

to a recognition by the legislature that special districts 

have the implied authority to create local pension systems. 

That section provides: 

A local pension system established for 

employees of a subdivision may merge into the 

[County and District] retirement system on 

conditions prescribed by the board of 

trustees [of the County and District Retirement System]. 

Section 842.006 is the amended version of what originally 

was denominated sections 10 and 11 in V.T.C.S. article 

6228g. 

Subsection (c) of section 62 article XVI, which created 

the County and District Retirement System, authorized the 

legislature to provide for a voluntary merger of subdivision 

(b) "local systems" into the state system. Pursuant to this 

authorization, section 10 of article 6228g, V.T.C.S., was 

p. 6031 
Honorable Hugh Parmer - Page 21 (JM-1142) 

enacted to govern the merger of a .local county system into 

the newly-created state-wide system. 

pertinent part: 

It provided in 

The voluntary merger into the System 

established by this Act (in this Section 

called the 'state system') of pension systems 

heretofore established under Subsection (b) 

of Section 62 of Article XVI of the 

Constitution of Texas (in this Section called 

the 'local system') is hereby authorized upon 

the terms and conditions stated in this 

section, and upon such additional terms and 

conditions as may be prescribed by the Board 

of Trustees of the state system, and after 

approval of the merger proposal by the 

governing body of the subdivision. 

The only lllocal system11 to which this section could apply is 

a local county system 

section 62. 

authorized by subsection (b) of 

~Section 11 of article 6228g, V.T.C.S., governed "other 

local systems" and provided in pertinent part: 

The voluntary merger into the state system 

created by this Act of pension systems 

heretofore or hereafter established for 

employees ~-of subdivisions as hereinabove 

defined (exclusive of such systems as are 

included within the provisions of Section X, 

above)13 is authorized to be effected upon 

13. Subdivision 3 of section 2 of article 6228g, 

V.T.C.S., defined %ubdivisionW in the following way: 

The term 'subdivision# means and includes: 

the several counties of this State; all other 

political subdivisions of this State now 

existing or hereafter established, which 

consist of all of the geographical area of a 

county, or of all or parts of more than one 

county; the several political subdivisions of 

each county of this State which have the 

.(Footnota Continued) 

p. 6032 
Honorable Hugh Parmer - Page 22 (JM-1142) 

It 

terms and conditions to be prescribed by the 

Board of Trustees of this state system, and 

generally in accordance with the provisions 

of Section X, above, so far as applicable. 

is argued that the existence of this section 

indicates legislative recognition that special districts 

have the implied power to create local pension systems 

because it is only to these systems that the section could 

refer. We disagree. If, at the time that this section was 

enacted, there were no other subdivisions that had explicit 

statutory authority to create pension systems to which this 

section could have applied, this argument might be more 

compelling. Such, however, was not the case. s e. a 

V.T.C.S. arts. 4494i, 4494n (now recodified as chaEterq.28; 

of the Health 8 Safety Code); board of Manaaers of the 

J Ha r s Count H 8 . ist. v. 

for the Citv of Houston, 449 S.W.2d 33 (Tex. 1969); Attorney 

General Opinion WW-904 (1960) . The fact that the 

legislature enacted section 11 of article 6228g is not 

evidence of legislative recognition that special districts 

that do not have the explicit statutory authority to create 

local pension systems possess the implied authority to 

create them. 

The third argument. misconstruing specific statutory 

provisions asserts that the existence of section 802.001 of 

title 8. ~of the Government Code indicates legislative 

recognition that special districts have the 

authority to create local pension systems. 

implied 

We disagree. 

(Footnote Continued) 

power of taxation; and all counties and 

cities operating a city-county hospital under 

the provisions of Chapter 383, Acts of the 

48th Legislature,.Reg-ular Session, 1943, as 

amended [V.T.C.S.' art. 4494i, now recodified 

as Health & Safety Code 55 265.011 - .016]. 

The term also includes, for the purpose of 

providing similar coverage for its own 

employees, the Texas County and District 

Retirement System. But the term 'subdivision' excludes all incorporated cities and 

towns, and all school districts and junior 

college districts established under the laws 

of this State. 
. 

Honorable Hugh Parmer - Page 23 (JM-1142) 

Chapter 802 of title 8 of the Government Code sets 

forth certain administrative requirements governing public 

retirement systems, and provides that, with certain 

specified exceptions, all must register with the State 

Pension Review Board. Subdivision (2) of section 802.001 

defines "public retirement system" for purposes of that 

chapter and provides: 

'Public retirement system' means a 

continuing, organized program of service 

retirement, disability retirement, or death 

benefits for officers or employees of the 

state or a political subdivision, or of an 

agency or instrumentality of the state or a 

political subdivision, other than: . 

(A) a program providing only workers' 

compensation benefits: 

(B) a program administered by the federal 

government;14,. /\ 

(C) an individual retirement account or 

individual retirement annuity within the 

meaning of Section 408, or a retirement bond 

within the meaning of Section 409, of the 

Internal ,Revenue .Code.. of;: 1986 (26 U.S.C., 

Sections 408, 409): 

(D) a plan described bye Section 401(d) 

[sic] of the Internal Revenue Code of 1986 

(26 U.S.C. Section 401)~~~ 

(E) an individual account plan consisting 

of an annuity contract described by Section 

403(b) of the Internal Revenue Code of 1986 

(26 U.S.C. Section 403);16 

14. See V.T.C.S. art. 695g. 

15. &g V.T.C.S. art. 6252-3e, to be superseded by 

V.T.C.S. art. 6252-3g. 

16. &8 V.T.C.S. art. 6252-5a. 

p. 6034 
Honorable Hugh Parmer - Page 24 (JM-1142) 

(F) eligible state deferred 

compensatizz plan described by Section 457(b) 

of the Internal Revenue Code of 1986 

U.S.C. Section 457);17 or 

(26 

(G)(i) in Sections 802.104 and 802.105 of 

this chapter, a program for which benefits 

are administered by a life insurance company; 

and 

(ii) in the rest of this chapter, a 

program for which the on1 funding agency is 

a life insurance company. 18 

This section merely requires that all public retirement 

systems, other than those programs specifically listed 

above, must register with the State 'Pension Review Board. 

The list sets forth programs in which political subdivisions 

have been authorized to participate explicitly by statute or 

in which they arguably may be permitted to participate in 

the future. It is not a list of programs in,which political 

subdivisions have implied authority to participate nor does 

it in any way constitute an affirmative conferral of 

authority to participate. in such programs. Moreover, 

section 802.105, which requires that each public retirement 

system register with the board, provides that registrants 

must include "a c itation of the law under which the system 

was created." Gov't Code s 802.105(b)(3) (emphasis added). 

Obviously, any system whose authority was merely imnlied 

could not comply with this provision. Thus it is evident 

that the legislature did not assume that such implied 

authority existedl9. 

17. See V.T.C.S. art. 6252-3f, to be superseded by 

V.T.C.S. art. 6252-3g. 

18. j&9 V.T.C.S. art. 6252-5a. 

19. It is suggested that the Internal Revenue Code 

itself confers authority on special districts to enter into 

plans approved by the IRS. We disagree. The form letter 

that the IRS sends special districts approving a plan 

specifically disclaims that it constitutes approval under 

local law: 

(Footnote Continued) 

p. 6035 
Honorable Hugh Parmer - Page 25 (JM-1142) 

The final argument adduced to support the claim that 

appraisal districts have the implied authority to create 

local pension systems does not misconstrue any statutory 

provisions. Instead, it misapplies a rule of statutory 

construction. It is urged that, because the staff of the 

State Property Tax Board, in its published newsletters and 

pamphlets, declared that appraisal districts were empowered 

to create local pension systems other than those whose 

creation is specifically authorized by statute, this 

administrative construction should be given great weight. 

We do not find this argument convincing. 

It is an accepted ,principle of statutory construction 

that the construction placed upon a statute by the agency 

charged with its administration is entitled to great weight, 

Ex narte Roloff, 510 S.W.2d 913 (Tex. 1974): State v.: 

Aransas Dock and Channel Co., 365 S.W.2d 220 (Tex. Civ. App. 

- San Antonio 1963, writ ref'd), especially where contemporaneous, or nearly so, with the statute itself, Burroubhs 

V. Lvles, 181 S.W.Zd 570 (Tex. 1944); Stanford v. Butler, 

181 S.W.Zd 269 (Tex. 19441. But in this instance. the 

application of this 'principle is undermined because the 

administrative construction made by the staff of the State 

Property Tax Board has not been consistent. 

As early as 1983, the pamphlet published by the agency 

entitled "Appraisal Board Manual: A Handbook for Countywide 

Appraisal District Directors" provided specifically that 

,appraisal districts could participate in either the County 

and District Retirement System or a private retirement plan. 

Id. at 19-20. But even earlier, in an issue of the agency's 

monthly newsletter ?3tatement," published in August 1980, 

the agency indicated that the only options available to 

appraisal districts were participation in the federal Social 

Security program, the County and District Retirement System, 

or both. Id. at 9. 

Moreover, the application of this principle of 

construction has been invoked in instances in which an 

(Footnote Continued) 

This opinion relates only to the acceptability of the 

form of the plan under the Internal Revenue Code. It 

is not an opinion of the effect of other Federal or 

local statutes. (Emphasis added.) 

p. 6036 
Honorable Hugh Panzer - Page 26 (JM-1142) 

administrative agency has construed an act that it is 

charged to administer. In this instance, the State Property 

Tax Board has no duties relative to any of the statutes 

governing the creation of pension systems or deferred 

compensation plans. Without regard to either the skill or 

knowledge of the staff of the State Property Tax Board, 

their administrative construction of these statutes is 

entitled to no greater weight than the administrative 

constructions of these same provisions by the staff of, for 

example, the Texas Water Commission or the Department of 

Public Safety. 

We therefore conclude that appraisal districts have no 

implied authority, absent specific statcltory authority, to 

create local pension systems. Accordingly, we conclude taat 

appraisal districts may participate in the following: .the 

federal Social Security program pursuant to article 695g, 

V.T.C.S., the County and District Retirement System pursuant 

to chapter 842 of the Government Code, and deferred 

compensation plans authorized by article 6252-3e and 

6252-3f,,V.T.C.S. (to be superseded by article 6252-3g, 

V.T.C.S., effective September 1, 1990). Appraisal districts 

have no implied authority to create local retirement systems 

analogous to those authorized by articles V.T.C.S. 6243k and 

62283, which incorporated cities and counties, respectively, 

may create. We turn finally to your second question. 

You wish to know what will be the income tax 

consequences to individual appraisal district employees and 

the proper method of disbursing funds held in any retirement 

plans in the event that any plans already in place were 

entered into improperly. The Texas Association of Appraisal 

Districts conducted a survey of its members that indicated 

that, among the 254 counties of the state, 124 appraisal 

districts offer "local retirement plans." If an appraisal 

district created a local plan that was not authorized by 

statute, the apparent varieties as to contracts entered 

into, benefits offered, system or plan administration, 

restrictions as to participation, years required for 

vesting, employee contributions, and appraisal district 

contributions are so great that an attempt would necessarily 

require us to answer hypothetical questions and engage in 

fact-finding, neither of which is permitted in the opinion 

process. Accordingly, we decline to answer your second 

question. 

p. 6037 
Honorable Hugh Parmer - Page 27 (JM-1142) 

We are not unmindful of the possible consequences of 

our decision, but the consequences of legal interpretation 

do not control. Regarding a matter of constitutional 

interpretation, the Texas Supreme Court declared in Kov v. 

Scheider, 218 S.W. 479 (Tex. 1920): 

No matter how far-reaching and disastrous 

would be the consequences . . . we would not 

decline to make the declaration if such was 

believed to be the true intent of the 

language of the Constitution. 

Quoted in Director of the DeD't of Asric. and Env't v. 

Printina Indus. Ass'n. of Texas, 600 S.W.2d 264 (Tex. 1980). 

--SheDherd v. San Jacinto Junior Collece Dist., 363 S.W.2d 

742 (Tex. 1962); Cramer v. ShenDard, 167 S.W.2d 147 (Tex. 

1942). We are no less bound by this principle. 

The situation with which we are here confronted is not 

altogether unprecedented. When the legislature was apprised 

of the fact that many appraisal districts in the state had 

entered into long-term lease agreements for the rental of 

office space or entered into contracts for the construction 

of buildings or the purchase of real property without the 

statutory authority to do'so, 'it enacted section 6.051 of 

the Tax Code to so empower those appraisal districts. Acts 

1987, 70th Deg., ch. 55, S 2, at 147. ,The remedy for the 

situation with which we are here confronted lies with the 

legislature. 

We affirm the result of Attorney General opin'ion 

JN-1068. 

SUMMARY 

Appraisal districts are authorized to 

participate in the federal Social Security 

program by article 695g, V.T.C.S., to 

participate in the County and District 

Retirement System by chapter 842 of the 

Government Code, and to create deferred 

compensation plans authorized by V.T.C.S. 

articles 6252-3e and 6252-3f. Appraisal 

districts have no implied authority to create 

local pension systems analogous to those 

systems that incorporated cities and counties 

may create pursuant to V.T.C.S. articles 

6243k and 62283 respectively. Because an 

answer to the question as to the possible 

p. 6038 
Honorable Hugh Parmer - Page 28 (JM-1142) 

income tax consequences to individual 

appraisal district employees of participating 

in a retirement system that is not authorized 

by statute would require us to both answer 

hypothetical questions and make findings of 

fact, we decline to answer your second 

question. We affirm the result of Attorney 

General Opinion JM-1068 (1989). 

Very truly yours, 

, 

3-W 

JIM MATTOX 

Attorney General of Texas 

MARYRELIRR 

First Assistant Attorney General 

JUDGE ZOLLIE STEAKLEY 

Special Assistant Attorney General 

RENEA HI& 

Special Assistant Attorney General 

. 

RICK GILPIN 

Chairman, Opinion Committee 

Prepared by Jim Moellinger 

Assistant Attorney General 

p. 6039