Court Opinion

ID: 4127820
Source: CourtListenerOpinion
Date Created: 2017-02-18 00:33:28.984738+00
Date Added: 2024-06-11T14:33:52.923827
License: Public Domain

ATTORNEY GENERAL OF TEXAS
                                           GREG        ABBOTT

                                               February 19, 20 13

The Honorable John J. Carona                               Opinion No. GA-0990
Chair, Committee on Business & Commerce
Texas State Senate                                         Re:    Whether an economic development
Post Office Box 12068                                      corporation may provide health benefits to its
Austin, Texas 78711-2068                                   employees through a risk pool established
                                                           under chapter 172, Local Government Code
                                                           (RQ-1084-GA)

Dear Senator Carona:

        You seek our opinion on the question of whether an economic development corporation
may provide employee benefits for its employees through a risk pool established under Chapter
172 of the Local Government Code. 1 Subsection 172.004(a) provides that "[a] political
subdivision or a group of political subdivisions pursuant to The Interlocal Cooperation Ace
... directly or through a risk pool may provide health and accident coverage for political
subdivision officials, employees, and retirees, . . . and employees of affiliated service
contractors." 3 TEX. Loc. Gov'T CODE ANN. § 172.004(a) (West 2008) (footnote added); see
id. §§ 172.004(b) (listing types of coverage that may be provided); 172.005 (authorizing political
subdivisions to establish a risk pool). You state that under this section, "employers that join a
risk pool must be either a political subdivision or an affiliated [service] contractor." Request
Letter at 2. Because an economic development corporation is not a political subdivision, you
suggest that an economic development corporation may not participate in a risk pool. See id. at

        1
         Letter from Honorable John J. Carona, Chair, Bus. & Commerce Comm., to Honorable Greg Abbott, Tex.
Att'y Gen. at 1 (Sept. 19, 2012), http://www.texasattorneygeneral.gov/opin ("Request Letter").
         2
           The Interlocal Cooperation Act is found in chapter 791 of the Government Code. See TEX. GOV'T CODE
ANN. §§ 791.001-.035 (West 2012). Its stated purpose is to "increase efficiency and effectiveness of local
governments by authorizing them to contract, to the greatest possible extent, with one another and with agencies of
the state." /d. § 791.001.
         3
          An "affiliated service contractor" is "an organization qualified for exemption under Section 501 (c),
Internal Revenue Code (26 U.S.C. Section 501(c)), as amended, that provides governmental or quasi-governmental
services on behalf of a political subdivision and derives more than 25 percent of its gross revenues from grants or
funding from the political subdivision." TEX. Loc. Gov'T CODE ANN.§ 172.003(1) (West Supp. 2012). There is no
question that an economic development corporation satisfying the definition of affiliated service contractor may
participate in a risk pool as allowed under section 172.004. The question of whether any particular economic
development corporation is an affiliated service contractor is a fact question inappropriate to the attorney general
opinion process. See Tex. Att'y Gen. Op. No. GA-0876 (2011) at 3.
The Honorable John J. Carona - Page 2           (GA-0990)

1-2; see also TEX. Loc. Gov'T CODE ANN. §§ 501.055(b) (West Supp. 2012) (providing that an
economic development corporation is not a political subdivision); 501.002(5) (defining the term
corporation).

        Your request letter also points out that an economic development corporation's authority
to participate in a risk pool may be affected by Local Government Code section 501.067, which
provides as follows:

               Notwithstanding any law to the contrary and with the consent of
               the [economic development] corporation's authorizing unit, a
               corporation may obtain . . . health benefits coverage, liability
               coverage, workers' compensation coverage, and property coverage
               under the authorizing unit's insurance policies, through self-funded
               coverage, or under coverage provided under an interlocal
               agreement with a political subdivision ....

TEX. Loc. Gov'T CODE ANN. § 501.067(a)(l) (West Supp. 2012); see Request Letter at 1-2.
Under section 501.067, an economic development corporation is expressly authorized to obtain
health benefits coverage for its employees. !d. Section 501.067 enumerates three methods by
which the economic development corporation may obtain these employee benefits. See id. To
the extent that any of the three health coverage methods include the possibility of an economic
development corporation securing employee benefits through a risk pool, you suggest that the
arrangement may be prohibited by section 172.004. See Request Letter at 1-2.

         As we consider the relationship between these statutory provisions, we are mindful that
the court's primary objective in construing statutes "is to ascertain and give effect to the
Legislature's intent." TGS-NOPEC Geophysical Co. v. Combs, 340 S.W.3d 432, 439 (Tex.
2011). Like the courts, we begin with the plain language of the statute and apply its common
meaning. See City of Rockwall v. Hughes, 246 S.W.3d 621, 625-26 (Tex. 2008). In addition, we
seek to reconcile and harmonize statutory provisions, if it is reasonably possible, so that every
legislative enactment may be given effect. See TEX. Gov'T CODE ANN. § 311.021(2) (West
2005) ("In enacting a statute, it is presumed that . . . the entire statute is intended to be
effective[.]"); La Sara Grain Co. v. First Nat'l Bank of Mercedes, 673 S.W.2d 558, 565 (Tex.
1984) ("Generally, courts are to construe statutes so as to harmonize with other relevant laws, if
possible.").

        We do not agree that section 172.004 is an impediment to section 501.067. Indeed,
section 501.067 applies "[n]otwithstanding any law to the contrary." TEX. Loc. Gov'T CODE
ANN.§ 501.067(a) (West Supp. 2012). Thus, to any extent that section 172.004(a) is contrary to
section 501.067, it is expressly superseded by the plain language of section 501.067. See State v.
Mid-South Pavers, Inc., 246 S.W.3d 711, 721-22 (Tex. App.-Austin 2007, pet. denied)
(describing the phrase "notwithstanding any law to the contrary" as indicative of legislative
intent that the section in question is to supersede other Texas law regarding same subject).
The Honorable John J. Carona - Page 3                    (GA-0990)

Further, section 501.067 is the later-enacted provision. 4 TEX. Gov'T CODE ANN. § 311.025(a)
(West 2005) (providing that "if statutes enacted at the same or different sessions of the
legislature are irreconcilable, the statute latest in date of enactment prevails"); see Jackson v.
State Office of Admin. Hearings, 351 S.W.3d 290, 297 (Tex. 2011) (utilizing rule to resolve
statutory conflict).

        Thus, sections 172.004 and 501.067 may be harmonized so that both are effective. Under
section 172.004, an economic development corporation is not expressly authorized to directly
obtain benefits for its employees through a risk pool. However, section 501.067 permits an
economic development corporation to participate in a risk pool, and section 172.004 does not
stand as a bar to such an arrangement. We conclude that to the extent permitted by section
501.067, an economic development corporation may obtain benefits for its employees through a
risk pool.

        4
          Section 501.067 was originally added to Texas statutes in 1999 as an amendment to section 5190.6 of the
Revised Civil Statutes. See Act of May 30, 1999, 76th Leg., R.S., ch. 1425, § 1, 1999 Tex. Gen. Laws 4864, 4865.
It was codified as part of the Local Government Code in 2007. See Act of May 15, 2007, 80th Leg., R.S., ch. 885, §
3.01, 2007 Tex. Gen. Laws 1905, 2092. Section 172.004 was originally added to the Local Government Code in
1989. See Act of May 16, 1989, 71st Leg., R.S., ch. 1067, § 1, 1989 Tex. Gen. Laws 4316,4317.
The Honorable John J. Carona - Page 4          (GA-0990)

                                   SUMMARY

                     To the extent permitted by section 501.067 of the Local
              Government Code, an economic development corporation may
              obtain health benefits for its employees through a risk pool.

                                            Very truly yours,

                                                         ~
DANIEL T. HODGE
First Assistant Attorney General

JAMES D. BLACKLOCK
Deputy Attorney General for Legal Counsel

JASON BOATRIGHT
Chairman, Opinion Committee

Charlotte M. Harper
Assistant Attorney General, Opinion Committee