Court Opinion

ID: 4137163
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:21:38.326499+00
Date Added: 2024-06-11T14:37:44.827128
License: Public Domain

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                         May   19,   1953

      Hon. W. P. Herms, Jr.     Opinion No. S-hi3
      County Auditor
      Wailer County             Re: Several questions,relating
      Hempstead, Texas              to the amount of securities
                                    which mustybe pledged by
      Dear Sir:                     the county depository.
                You have requssted an opinion on the follow-
      ing questions:'
                "1. The county depository should pledge
           obligations (presuming such is their choice
           to secure county funds) in what amount?
               "2. May this amount of depository secu-
          rity vary from month to month or from q.uarter
          to quarter to conform to the revised daily
          balances?
               “3. If yo’ur anser is E   to No. 2 above,
          then under the facts, what is the minimum
          amount of funds for which security should be
          required?
               "4. In view of the fact that for short
          periods during the year, funds from maturing
          Treasury Bills will actually be on deposit
          in the depository, does the investment of a
          sizable portion of County Funds in such bills
          in any way affect this matter?"
                Article 2547, Vernon's Civil Statutes, provides
      three methods for qualifying as a county depository, and
      states in part as follows:
               "Within fifteen (15) days after the
          selection of such 'depository,it shall be
          the duty of the banking corporation, as-
          sociation or individual banker so selected,
          to qualify as county depository in one or
Hon. W. P. Herms, Jr., page 2 (S-43)

     more of the following ways, at the option
     of the Commissioners' Court:

          ":(a)By executing and filing with the
     Commissioners' Court, a bond or bonds . . .
     said bond to be signed by not less than five
     (5) solvent sureties. . . said bond or bonds
     to be in an amount equal to~the estimated
     highest daily balance of such county, as
     determined by the Commissioners' Court, such
     estimated daily balance to be in no event
     less than seventy-five (75%) per cent of
     the highest daily~balance of said county for
     the next preceding year, less,the amount of
     bond funds received and expended; provided,
     however, in the event that county funds
     derived from the s,aleof county securities~
     during the term of such bond are deposited,
     such Commissioners' Court shall require
     additional bond and/or bonds, and/or pledge
     of securities equal to the amount of such
     additional county funds. . .
            "(b) By having issued and executed by
     some solvent surety company or companies
     authorized to do business in the State of
     Texas,   such bond or bonds, ,asprovided by
     law, to be in the amount and ,payableas pro-
     vided in subdivision (a) hereinab,ove,which
     said surety bond shall be approved by both
     the Commissioners' Court and the Comptroller,
     and filed in the office of the County Clerk
     of said county. . e
          "(c) In lieu of such personal bonds or
     surety bonds as above specified, said banking
     corporation, association or individual banker
     so selected as county depository, may pledge,
     and said depository bank is authorized to
     pledge with the Commissioners' Court for the
     purpose of securing such county funds, se-
     curities of the following kind, in an amount
     equal to the amount of such county funds on
     deposit in said depository bank. s .'
..

     Hon. W. P. Herms, Jr., page 3 (S-43)

                If the method under subsection (a) or (b) as
     above stated is followed the securities, as a minimum,
     must be “75% of the highest daily balance of said co,unty
     for the next preceding year less the amount of bond
     funds received and expended." However, an amount equal
     to the estimated highest daily balance of such county
     must be maintained at all times.
               If subsection (c) above stated is followed,
     securities pledged are to be in an amount equal to the
     amount of county funds on depos,it.

               In regard to your last three question, the
     second paragraph of subsection (c), Article 2547,
     Vernon's Civil Statutes, states in part:
               "When the securities pledged by a de-
          pository bank to secure county funds shall
          be in excess of the amount required 'under
          the provisions of this Article, the Commis-
          sioners' Court shall permit the release of
          such excess; and when the county funds de-
          posited with said depository bank shall for
          any reason, increase beyond the amount of
          securities pledged, said depository bank
          shall immediately pledge additional securities
          with the Commis,sioners'Court so that the
          securities pledged shall at no time be less
          than the total amount of county funds on de-
          posit in said depository bank. . .'
               As provided in this section depository securi-
     ties may vary from time to time to conform to revised
     daily balances. Security is required for all funds de-
     posited regardless of the amount of the fund.
               If the county funds in the depository are in-
     creased, beyond amount of sec,uritiespledged, from funds
     from maturing Treas,urybills or any other source, the
     depository bank shall immediately pledge additional se-
     curities with Commissioners' Court as provided above.
     If the county funds are decreased in size from invest-
     ment in Treasury bills or any other investment, the
     Commissioners' Court shall permit the release of securi-
     ties in excess of the amount required under Article 2547,
     Vernon's Civil Statutes.
Hon. W. P. Herms, Jr., page 4 (S-43)

          County depository must pledge securi-
     ties or obligations in an amount equal to
     the amount of such county funds on deposit.
     The amount of depository securities may
     vary during the year.. Securities are re-
     quired for all funds deposited. If county
     funds,in depository increase beyond security
     the depository shall immediately pledge addi-
     tional security. If the amount of money in
     the county depository is decreased, the Com-
     missionerss Court shall permit the release
     of securities in excess of the amount re-
     quired under Article 2547, Vernon's Civil
     Statutes.
                                Yours very truly,
APPROVED:                       JOHN BEN SHKPPERD
                                Attorney General
J. C. Davis, Jr.
County Affairs Division
C. K. Richards                  By ab-      e.Q*
Reviewer                           Sam C. Ratliff
                                            Assistant
Robert S. Trotti
First Assistant
John Ben Shepperd
Attorney General
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