Court Opinion

ID: 4134794
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:54:54.763235+00
Date Added: 2024-06-11T09:36:37.085099
License: Public Domain

Honorable Jesse James              Opinion No. C-667
State Treasurer
Austin, Texas                      Re:   Whether Wilbarger
                                         County'Hospltal
                                         District Bonds,
                                         Issued January 1,
                                         1966, may be accepted
                                         as collateral se-
                                         curity for state
Dear Mr. James:                          deposits.
     You have requested an oplnlon as to whether Wllbarger
County Hospital District Bonds, issued January 1, 1966,
may be accepted as collateral security for state deposits.
     Article 2529, Vernon's Clvll Statutes, Is the general
statute setting out classes of securities which may be
pledged as security for state deposits. County hospital
district bonds are not specifically enumerated in Article
2529 and could be eligible under this statute, only if
they could be considered 'tax bonds of municipal corpora-
tions". This office has on several occasions held that
the reference to "munFcipa1 corporations" in Article 2529
is limited to cities, towns, and villages. See Attorney
General's 0 inlons No. O-152 (1939), o-2182 (1940), and
c-664 (19667, copies of which are enclosed herewith. Thus,
the bonds in question are not eligible under Article 2.529.
     Thus, such bonds are eligible only if the statute
creating the Wllbarger County Hospital District and author-
izing the issuance of Its bonds, specifically decrees that
such bonds are eligible as security for state deposits.
     The pertinent statute is Article 4494q-22, Vernon's
Civil Statutes, Sec. 16 of which provides as follows:
          "Sec. 16. All bonds issued by the district
     authorized to be established and created under the
     provisions of this Act shall be and are declared

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Honorable Jesse James, page 2 (c-667)

     to be legal and authorized investments for banks,
     savings banks, trust companies, building and
     loan associations, insurance companies, fiduciaries,
     trustees, guardians, and for the sinking funds of
     cities, towns, villages, counties, school districts,
     or other political corporations or subdivisions of
     the State of Texas; and such bonds shall be lawful
     and sufficient security for deposits to the ex-
     tent of their face value when accompanied by all
     unmatured coupons appurtenant thereto." (emphasis
     ours)
     The uestion, then, is whether the emphasized portion
of Sec. 12 includes state deposits or Is limited to de-
posits of the other entities listed in Sec. 16.
     Prior to 1963 the Attorney General of Texas had the
duty of approving the eligibility of all bonds offered
as security for state deposits. It was the settled policy
of this office not to approve the eligibility of securi-
ties unless they were listed in Article 2529 or unless the
statute authorizing issuance of the particular bonds also
provided in specific terms that such bonds would be eligible.
The same policy has been adhered to by the State Treasurer.
Under this long-standing construction the bonds herein In
question would not be considered eligible.
     It is a settled rule of statutory construction that
the Legislature is presumed to have known the construction
placed on the same or a similar statute by executive or
administrative officers. 53 Tex. Jur. 2nd. 276, Statutes,
Sec. 183, and cases cited thereunder. Thus, the Legisla-
ture, in enacting Sec. 16 of Article 4494q-22, in 1965,
would be presumed to have known of the interpretation
followed by the Attorney General and the State Treasurer
in regard to ellglbillty as security for state deposits
and did not Intend that the bonds issued by the Wilbarger
County Hospital District to be eligible as security for
such deposits.
     This conclusion is further strengthened by the fact
that such an interpretation does not rob the underlined
portion of Sec. 16 of meaning but rather makes the entire
section more reasonable and logical in that the "deposits"
referred to in the underlined portion would then simply
refer back to the entities listed earlier In Sec. 16, I.e.,
cities, towns, villages, etc.

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Honorable Jesse James, page 3 (C-667)

The validity of this interpretation is made still
sreater by consi$ering Sec. 16 of Article 4$&q-22
 in pari materla with other statutory provisions
bearing on the same subject. In making such comparisons
we fSnd that the same Legislature that enacted Article
449&q-22 also enacted Article 2815r-2, pertaining to the
issuance of revenue bonds by junior college districts,
Sec. 7 of which reads as follows:
             "Sec. 7.  All such bonds and notes shall be
        and are hereby declared to be legal and author-
        ized investments for banks, savings banks, trust
        companies, building and loan associations, saving
        and loan associations and insurance companies.
        Such bonds and notes shall be eligible to secure
        the deposit of any and all public funds of the
        State of Texas and any and all public funds of
        cities, towns, villages, counties, school districts,
        or other political corporations or subdivisions of
        the State of Texas, and such bonds and notes
        shall be lawful and sufficient security for said
        deposits to the extent of the principal amount thereof,
        or their value on the market, whichever is the lesser,
        when accompanied by all unmatured coupons appurtenant
        thereto."
     In Sec. 7 of Article 2815x-2 it is completely clear
that bonds issued under that article were Intended to be
eligible as security for state deposits. Comnaring its
language with that in Sec. 1.6 of Article 4494q-22 it is
equally clear that bonds iSSUed under the latter article
were not intended to be eligible for such, because to hold
otherwise would be, in effect, to render meaningless and
useless the language utilized in Article 2815r-2.
                        SUMMARY
        Wilbarger County Hospital District Bonds may
        not be accepted as security for state deposits.
                           Respectfully submitted,
                           WAGGONER CARR
                           Attorney General    of   Texas

                               es M. St/rock
JMS:vg

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Honorable Jesse James, page 4 (C-667)

APPROVED:
OPINION COPlPlITPEE
w. v. Geppert, Chairman
John Fainter
John Reeves
Harry (fee
Roy Johnson
APPROVED FOR THE ATTORNEY GENERAL
By: T. B. Wright

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