Court Opinion

ID: 4132414
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:26:19.460829+00
Date Added: 2024-06-11T09:36:29.759377
License: Public Domain

,March 30, 1977

The Honorable John Lawhon            Opinion   No.   H- 966
District and County Attorney
BOX 718                              Re,: Authority of City-
Denton + Texas 76201                 County Hospital Board to.,
                                     lease part of hospital
                                     grounds for construction
                                     of medical office building
                                     by private individuals;

Dear Mr. Lawhon:

     You have requested our opinion regarding the authority
of the Denton City-County  Hospital Board to ,&ease iand to,~
private persons for construction of a medical office building.
Specifically, you ask:

          Whether or not the City-County,Hospitai
          Board may lease a portion of the hospital
          grounds to 'an individual or corporation for
          a medical-professional building, with a;
          provision for reversion of the premises
          and building.to the board~at.the:conclusion
          of the lease period.

The proposed building would be'~adjacent to the hospital and
connected to it by a bridge at each level. The City-County
Hospital Board would lease the land on a long term  lease,
and private persons wo,uld be,responsible for financing,
constructing, and managing the building.. On completion of
the lease, title to',the building would revert to the City-
County Hospital Board. .The Board would not spend,any public
funds or assume any liabilities.
    'The Denton City-County Hospital Board,was .created under
article 4494i-1, V.T.C.S.   See Atto,rney General Opinion M-
                            -,
762 .(1970). Then Hospital Board constitutes a "joint agent"
of the,county and city forhospital   purposes. V~.T.C.S. art.
4494i-1, 6 2. At present, title,to.the,hospita&,~grounds
remains in the ~city and county, but .section5 of article

                               p. 4026   ~..
The Honorable John Lawhon - page 2   (H-966)

4494i-1 authorizes the city and county to convey the hos-
pital and the associated real property to the Hospital
Board. The Board may lease property, subject to the ap-
proval of the commissioners court and governing body of the
city. V.T.C.S. art. 4494i-1, 59 4, 5. The city and county
may thereby assure themselves that the Board in making the
lease has acted "solely for [their] joint benefit."   V.T.C.S.
art. 4494i-1, 9 2. The Hospital Board must act "for hos-
pital purposes."  1d:We believe it will act for hospital
purposes if it arranges a lease that upon termination pro-
vides them with a medical facility adjoining the hospital,
and in the interim benefits hospital patients.   See Sullivan
v. Andrews Count    517 S.W.2d 410 (Tex. Civ. App.-   El Paso
m74, writ -T-#
           re    n.r.e.). Consequently, article 4494i-1,
V.T.C.S., authorizes the Board to make the proposed lease.

      The ~1eas.eof hospital grounds also must comply with
article 3, section 52 of the Texas Contitution, which pro-
hibits any county or city from granting any "public money
or thing of value in aid of, or to any individual, associa-
tion or corporation whatsoever . . . ." The city or county
cannot accomplish through its agent something the Consti-
tution forbids it to do. See Attorney General Opinion
C-517 (1965). Therefore, s      Denton City-County Hospital
Board may lease hospital property only to accomplish a
public purpose, and the lessee must pay an adequate con-
sideration for use of the property.    Sullivan v. Andrews
County, supra; Attorney General Opinion H-777 n976).n
Sullivan v. Andrews County, the court found that the county
could constitutionally lease to doctors space in a medical
office building adjoining the hospital where the evidence
showed that hospital patients would benefit from the close-
ness and ready availability of the treating physicians.     YOU
have not informed us about the terms of the proposed lease,
so we cannot determine as a matter of law whether it would
accomplish this or an analogous public purpose.    In drawing
up and approving the lease, the Hospital Board, city govern-
ment,  and county commissioners should be certain that the
lc-ese will serve a public purpose and include sufficient
controls so that the public purpose is actually accomplished.
See Attorney General Opinion H-445 (1974). The rent should
beset   so that together with the reversion of the building
at the end of ~the lease, the Hospital Board receives adequate
consideration for the use of its property.    See Attorney
General Opinions H-912, H-777 (1976); H-445 (1974).    If
these requirements are complied with, the proposed lease
will not violate article 3, section 52 of the Constitution.

                         P.   4027
The Honorable John Lawhon - page 3            (H-966)

                          SUMMARY

            Article 44941-1, V.T.C.S. authorizes the
            City-County Hospital Board to lease'land
            adjacent to the hospital for construction
            of a medical office building by private
            individuals.  Article 3, section 52 requires
            that the lease serve a public purpose and
            provide for payment of adequate rentals.

                                    ttorney     General of Texas
APPROVED:

Opinion Committee

                            p. 4028