Court Opinion

ID: 4146189
Source: CourtListenerOpinion
Date Created: 2017-02-18 04:05:23.630261+00
Date Added: 2024-06-11T14:48:57.075284
License: Public Domain

Hon. ~A. A. Miller    Opinion No. O-218 - ~Modifiedby V-157
County ,Attorney      Re: May excess cash In sinking fund
Newton County         ,forretirement of bonds be used by,
Newton, Texas         Road District for other purposes
                      named?
Dear Sir:
          We are in reoeipt of your ~letterof February 22, 1939
in which you request an opinion from this Department as to
whether the excess cash in a sinking fund for the retirement of
bonds may be used by a Road District for other specific purposes.
          A ttached to your reque,stis a resolutionfor ruling on
the sinking fund surplus~.This resolution states in effect that
there are outstandingbonds against Road District No. 1 in Newton
County, amounting to $26,025.00 principaland accrued interest;
that there is now in the County Treasury to the ‘creditof said
fund, as a result of the collectionof taxes levied to pay said
bonds and interest, $40,224.21,or a surplus of $14,199.21.
          Section 52, Article 3 of the Constitutionof Texas pro-
vides that road districts may vote bonds for the purpose of Athe
construction,maintenance,and operation of macadamizedgravel
or paved roads and turnpikes,or in aid thereof.”
          Article 752k Revised Statutes, provides that when the
bonds are issued, the CommissionersCourt shall levy an ad valor-
em tax sufficientto pay the interest on such bonds, and to pro-
vide a sinking fund to.pay the bonds at maturity.
          Article 752n Revised Statutes, provides that the Tax
Collector shall collect said
                          ‘,’taxes and’pay same to the County
Treasure~r. Article’7520,Re~visedStatutes,provides that the
County Treasurer is the custodian of the funds and shall promptly
pay the interest and principal as it becomes due on the bonds out
of the funds collected~fromsaid taxes.
          There insno provision in the law for what the County
Treasurer shall.do with any excess fund collected from the taxes
levied, over and above the amount required to pay the bonds, prin-
cipal and interest.
                                           h

Hon. A. A. Miller, page 2

          Article 839, Revised Statute,s,provides that the County
Treasurer shall not honor or pay any draft upon the interest and
sinking fund provided for the payment of the bonds, except for
the purpose of paying the interest on such bonds or redeeming
same, or for investmentin seauritiesas provided by law.
          The Supreme Court in Black v. Strength 246 S.W. 79
and in Aransas County v. Coleman-FultonPasture Ci    191 s.w. $56,
and in Moore v. Coffman, 200 S.W. 374, has held thii money voted
for specific purposes or for building designated roads or bridges,
must be used for such specific purposes.
          The County Treasurer, as well as the County Depository,
are under bond to pay the fund out, and are authorizedto pay
same out only for the purposes authorizedby law. Since there
is no provision in the law for the County Treasurer making any
dispositionof the surplus fund after the specific bonds are paid,
we are inclined to the view that this surplus collectionof taxes
could be used in said road district for the upkeep and mainten-
ance of the roads in said district. Since, however, the custo-
dians of said funds are under bond, we think it advisable for the
County Treasurer and the County Depository to institute a suit
in rem in the District Court in Newton County, setting up the
facts and have that court enter an order authorizingthem to pay
said &unds on warrants drawn by order of the CommissionersCourt
for the maintenanceof the roads of said district, or for what-
ever purpose the District Court, under all of the existing facts,
should think proper.
          We will next week call the attention of Senator Redding
of Lufkin, your Senator, to the situation and suggest that he
introduce a bill amending ,Article839 of ihe Revised Statutes to
authorize the excess or surplus left after bonds have been paid
to be used by the County Commissionersin the districtswhere the
bonds were voted for the purpose of the upkeep and maintenance
of the roads in said districts. It might be wise for your Commis-
sioners Court to communicatewith the Senator relative to the
matter.
          It is our opinion that it would be unwise for the County
Treasurer and County Depository to pay said fund except on the
direct order of the District Court.
APPROVED:                       Yours very truly
/s/ Gerald G. Mann              ATTORNEY GENERAL OF TEXAS
ATTORNEY GENERAL OF TEXAS       By George W. Barcus /2/
                                George W. Barcus, Assistant
GWB
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