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HonorableT. 0. ,Walton,President Agricdtutialand MechanicalCollegeof Texas CollegeStation,Texas Dear Dr. Walton: opinionNo. o-2469 Re: Is the Board of Directorsof the Agriculturaland Mechanical Collegeempoweredto pay any part of the premiumson a policy of group life insurancecovering the dployees from studentfee funds, local funds, or other in- stitutionalfunds under the jur- isdictionof the Board - and re- lated question?
We beg to acknowledgereceiptof your letter of June 5, 1940, request- ing an opinionfrom this department,such letterbeing as follows,to-wit:
"On or about April 1, 1931, the SouthwesternLife Insurance Company,of Dallas,Texas, issuedto the Agriculturaland Mechani- cal College its policy of Group Insurance,insuringthe full-time employees(employeeseither on a nine months or twelvemonths ba- sis) of the Collegeagainstdeath and total and permanentdisabi- lity. The insurancehas been in full force since that date, and employeeshave been requiredto carry the insuranceas a part of their contract.* * *
"Underthe plan of insurance,the cost of premiumswas paid jointlyby the insuredemployeesand the College,the insuredem- ployeespaying approximatelyseven-eighthsof the premiumsand the Collegepaying approximatelyone-eighth. The proportionate part of the premiumspaid by the Collegewas and is made from un- assignedlocal funds;that is, from funds of the Collegenot ap- propriatedout of the State Treasuryand not designatedto be used for any particularpurpose.* * *
"The Board.of Directorsgave the matter carefulconsidera- tion when the plan was establishedand it was their jud&mentf&at the benefitto the CnlJ.ege& fmpra~eoed~.f#Xale of the staffwould be worth much more ths&the cost k-the institution.The judg- ment of the Board in this respecthas been amply substantiatedby our experienceunder the plan. The total cost to the Collegehas averagedbetween$3.00 and $4.00 per insuredemployeeper year, HonorableT. 0. Walton,Page 2 (C-2469)
and we have consideredthis as being in the nature of a small supple- ment to the salaryand permlsaibleunder the appropriation act.
"We would appreciateit, therefore,if you would informus on the followingpoints:
"1. Is the Board of Directorsof the A. & M. Collegeempowered to pay any part of the premiumson a policy of Group Life Insurance coveringthe employeesfrom studentfee funde, local,fundr,or other institutional funds under the jurledictionof the Board7
"2. If this cannotbe dons, can the Board legallypay its part of the premiumsfrom the Group InsurancePremiumsRevolvingAccount made up as outlinedabove of refundsma& by the InsuranceCompany under the participatingfeatureof the policy and held in trust for the insuredemployees?"
SectionI(a) of House Bill No. 255, the Appropriation Act for Insti- tutions of Higher Learningfor the currentbiennium,declare8:
"Thatall balance8in the institutional funds of the several State institutionsnamed in this Act, at the close of the fiscal year endingAugust 31, 1939, includingbalancesin their revolv- ing funds at that time, and the entire incor to said funds dur- ing each of the two fiscal years endingAugust 31,~1940, and Aug- ust 31, 1941, which are not otherwiseappropriatedfor either or both of said fiscalyears, are herebyappropriatedfor the sup- port, maintenance,operationand improvementof said State insti- tutions duringeach of the said fiscal years respectively."
In OpinionNo, O-1661,construingChapter144, Acts 45th Legislature-- the GeneralAppropriationBill -- with respectto balancesin institutional funds,we held that such funds may not be used to pay a part of the premiums for group hospitalizationend life insurancepoliciescoveringfacultymembers and