                                                September 24,1999



Mr. Jay Kimbrough                                          Opinion No. JC-0114
Executive Director
Texas Board of Private Investigators          and          Re:     Whether a municipality that offers alarm
    Private Security Agencies                              monitoring services for a fee is subject to the
P.O. Box 13509                                             licensing requirements  of chapter 1702 of the
Austin, Texas 78711                                        Texas Occupations Code (RQ-0004)



Dear Mr. Kimbrough:

         You have asked this office whether a city’s police department is subject to licensing by the
Texas Board of Private Investigators and Private Security Agencies (“the Board”) when engaged in
a proprietary, as distinct from a governmental activity. Your question, when framed, concerned
article 4413(29bb) of the Revised Civil Statutes, the Private Investigators and Private Security
Agencies Act (“the Act”); however, the Act was repealed and recoditied in House Bill 3 155 by the
76th Legislature as chapter 1702 of the Texas Occupations Code.’ We conclude that a police
department is not subject to such licensing, and that recent changes brought about by the
recodification have not made police departments subject to such licensing, however their activities
may be denominated.

        The Act, as codified at chapter 1702 of the Occupations Code, regulates the private security
industry in Texas. Pursuant to section 1702.061 of the Code, the Board has the powers and duties
to:
               (1) determine the qualifications of license holders, registrants, and
               commissioned security officers;

                   (2) investigate    alleged violations of this chapter and of board rules;

                   (3) adopt rules necessary to implement this chapter; and




           %x?ActofMay       13,1999,76thLeg.,RS.,ch.     38&g l,secs., 1702.001-.389,1999Tex.     Sess. Law Serv. 1431,
 223 1; id. 5 6(a), 1999 Tex. Sess. Law Serv. at 2439-40 (repealing article 4413(29bb)). For ease of citation, this opinion
 will refer to the provisions of the Act as they will be codified in the Texas Occupations Code.
Mr. Jay Kimbrough     - Page 2                     (X-0114)




                (4) establish and enforce standards governing the safety and conduct
                of each person licensed, registered, or commissioned under this chapter.

TEX. Oct. CODE ANN. $1702.061(b).


         Pursuant to sections 1702.10 1 and 1702.102 of the Code, which partially recodify section
13(a) of article 4413(29bb), persons who are not licensed by the Board may not act as investigations
companies or security services contractors, a term which includes alarm systems companies. An
alarm systems company is defined as a person who “sells, installs, services, monitors, or responds
to an alarm system or detection device.“Zd. $ 1702.105. The definition of a “person” who must be
licensed was formerly provided by section 2(2) of article 4413(29bb) ofthe Revised Civil Statutes:
“‘Person’ includes individual, firm, association, company, partnership, corporation, nonprofit
organization, institution, or similar entity.” Since “person” in that definition did not include political
subdivisions, this offtce has held that political subdivisions providing such services were not subject
to licensure under the Act. See Tex. Att’y Gen. LO-97-l 11, at 5-6.

         As you describe the situation that prompts your inquiry, you have received a complaint from
a trade association for alarm systems companies that various cities, through their police departments,
are offering alarm monitoring services to city residents for a fee. The trade association suggested
that the provision of such services required a license. You initially responded that political
subdivisions such as municipalities were not included within former section 2(2)‘s definition of
persons subject to the Act. The trade association, however, has argued that political subdivisions
ought only to be excluded from the licensing requirement when engaging in governmental, as
distinct from proprietary, activity. You ask, in effect, for our opinion of this construction.   While
we begin with a consideration of that question, we must also note and consider the implications of
the recent recodification of the Act.

         We note first our agreement with your reading of former section 2(2) as excluding political
subdivisions from the definition of “person.” To begin with the Board is, as we have noted, the
agency charged by section 1702.061 of the Code with enforcing the statute. “[Tlhe construction of
a statute by an agency charged with its execution is entitled to serious consideration unless the
agency’s construction is clearly inconsistent with the Legislature’s intent.” Texas Water Comm ‘n
v. Brushy Creek Mm. Util. Dist., 917 S.W.2d 19, 21 (Tex. 1996). Moreover, this office has
expressed the same view of the matter in a relatively recent letter opinion, see Tex. Att’y Gen. LO-
97-l 11. In Letter Opinion 97-l 11, one of the questions was whether a junior college district which
provided the services ofpart-time peace officers in its employ as security for events held by outside
organizations leasing its facilities was required to obtain a license under the Act. We concluded that
the junior college, as a political subdivision, was not subject to the licensure requirements.   After
reciting the definition in former section 2(2), we said, “A political subdivision is not specifically
listed among those comprising ‘person[s].’ Nor is a political subdivision qualitatively similar to
those listed so as to be embraced within the term ‘or similar entity’ in the above definition.” Tex.
 Att’y Gen. LO-97-l 11, at 5.
Mr. Jay Kimbrough    - Page 3                    (JC-0114)




        Nor are we persuaded by the trade association’s arguments that such a reading depends upon
whether the political subdivision be engaged in governmental or proprietary functions, or that
municipal employees engaged in providing these services as part of their jobs are or ought to be
subject to licensure. As to the suggestion that municipal employees so engaged must be licensed,
we note that pursuant to section 1702.321 of the Code, the statute does not apply to “an officer or
employee of the United States, this state, or a political subdivision of this state while the employee
or officer is performing official duties.” TEX. Oct. CODE ANN. 5 1702.321. So long as the
employees engaged in providing the alarm monitoring services are doing so in the course of their
employment rather than for personal pecuniary gain, then they are exempted from the Act. Cj: Bates
v. State, 587 S.W.2d 121, 131 (Tex. Crim. App. 1979) (en bane) (Act “patently inapplicable” to
person acting as agent of state).

          As to the trade association’s suggestion that political subdivisions ought to be considered
“persons” when engaged in proprietary activities, though not while engaged in governmental
activities, it also is unavailing. The distinction between governmental and proprietary functions is
essentially one drawn from the area of governmental tort liability. Cf: Edinburg Hosp. Auth. v.
Trevino, 941 S.W.2d 76, 81 (Tex. 1997) (“Before the Legislature enacted the Tort Claims Act,
governmental liability was limited to proprietary functions.” [citation omitted]). As such, we are
doubtful of its relevance here. However, even were we persuaded that such a reading was preferable
as a policy matter, we do not have the authority to add excluded words to a statutory definition, as
would be required for us to make the proposed distinction between governmental and proprietary
functions. “[Elvery word excluded from a statute must           be presumed to have been excluded for
a purpose. Only when it is necessary to give effect to the clear legislative intent can we insert
additional words or requirements into a statutory provision.” Cameron Y. Terrell & Garrett, Inc. 6 18
S.W.2d 535,540 (Tex. 1981).

         In Letter Opinion 97-l 11, this office concluded, “If the legislature had intended the act to
apply to a political subdivision as a ‘person’ that must obtain a license, it would have so expressly
provided.” Tex. Att’y Gen. LO-97-l 11, at 5-6. Such remains the case. Any amendment of the Act
to this effect is the province of the legislature, rather than this office.

         It might be argued that the legislature has done precisely that in House Bill 3 155, effective
September 1, 1999, which repeals and recodifies the Act, along with a variety of other licensing
statutes, incorporating such statutes into the Occupations Code. The Act will now constitute chapter
1702 of the Occupations Code.

         The definitions section ofchapter 1702 no longer contains a definition for the word “person.”
 Because section 1.002 of the Occupations Code requires that the Code be interpreted in accordance
 with chapter 3 11 of the Government Code (the “Code Construction Act”), and because section
 3 11.005 of the Code Construction Act defines “person” to include “government or governmental
 subdivision or agency,” see TEX. GOV’T CODE ANN. 5 3 11.005 (Vernon 1998), it might be argued
 that the legislature has effectively amended the statute to define “person” as including political
Mr. Jay Kimbrough     - Page 4                    (JC-0114)




subdivisions, not solely in the proprietary context, as the trade association would have had us do by
inserting the distinction into former section 2(2), but generally and for all purposes.

          We note that House Bill 3155 is intended to be a nonsubstantive recodification.     Section 7
of House Bill 3 155 states, “This Act is intended as a recodification only, and no substantive change
in law is intended by this Act.” A recent Texas Supreme Court case, Fleming Foods, Inc. v.
Rylander, 42 Tex. Sup. Ct. J. 744, 1999 WL 374119 (June 10, 1999), pet. reh. filed, counsels
against a mechanical application of such general statements of legislative intent when they conflict
with unambiguous changes in the statutory language of the new code provision: “[Phior law and
legislative history cannot be used to alter or disregard the express terms of a code provision.”
FlemingFoods, 42 Tex. Sup. Ct. J., at 748, 1999 WL 374119, at *6. In this case, however, we are
not interpreting a clear and unambiguous code provision, but the effect of an omission.

        So far as we are aware, in the brief time since its issuance, Fleming Foods has been
considered by only one appellate court. The Tyler Court of Appeals, in an unpublished slip opinion,
considered the case’s rationale precisely in the context of an omission and wrote:

                Here, we are faced with the deletion of a specific term, rather than the
                addition of a specific term. The new statute does not include a
                provision    that expressly provides for a change in the law.
                Accordingly,     this is not a case where specific provisions of a
                codification    which actually change the law should be given
                precedenceoverthe     legislature’s general statement ofintent regarding
                the recodification.

Chapa v. Spivey, No. 12-9%00150-CV (Tex. App.-Tyler         June 30,1999, no pet.) (not designated   for
publication), 1999 WL 444600, at *3.

         Unpublished slip opinions are, of course, not binding precedent. However, the Tyler court’s
argument is in our view both persuasive and applicable in the instant case. We are particularly so
persuaded because of City ofLaPorte v. Barfield, 898 S.W.2d 288 (Tex. 1995). In that case, the
Texas Supreme Court held that construing the word “person” to include a governmental entity within
the scope of the Anti-Retaliation Act because the law had been recodified in the Labor Code, and
therefore to deprive the city in question of governmental immunity, “would be not only a substantive
but a very significant change. Given the Legislature’s express intent not to make such changes, we
conclude that the Anti-Retaliation Law as recoditied does not waive governmental immunity.” 898
S.W.2d at 294.

         The effect ofreading “person” as including governmental entity in this statute, and hence of
bringing such entities under the aegis of the Board, would be at least as far-reaching as that rejected
by the Texas Supreme Court in City ofLuPorte. Since, by its nature, a police department “engages
in the business of obtaining or furnishing .     information related to       crime or wrongs done or
threatened against a state or the United States,” TEX. Oct. CODE ANN. § 1702.104(1)(A), every
Mr. Jay Kimbrough     - Page 5                   (JC-0114)




police department in the State of Texas would be required by the statute to hold an investigations
company license. See id. 5 1702.101. Every police department which, inter ah, “monitors, or
responds to an alarm system or detection device,” id. 5 1702.105, would be an alarm systems
company and would be required by section 1702.102 to be licensed as a security services contractor.
See id. $1702.102. Failure to seek such licensing could subject a police department to civil penalties
and an injunction under sections 1702.38 1 and ,382. In our view, such extraordinary consequences
would require clear and unequivocal statutory statement, and cannot result from the combination of
an omission whose purpose is unclear and a general rule of construction. Absent a clear directive
from the legislature requiring us to do so, we cannot assert that the police agencies of Texas are
subject to licensing and regulation by the Texas Board of Private Investigators and Private Security
Agencies.
Mr. Jay Kimbrough    - Page 6                   (X-0114)




                                      SUMMARY


                        A city police department is not subject to licensing under
               chapter 1702 of the Texas Occupations Code. This exemption does
               not depend on whether the department is engaged in governmental or
               proprietary activities.

                                            Yo rs very trul

                                            L
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                                            JOHN     CORNYN
                                            Attorney General of Texas



ANDY TAYLOR
First Assistant Attorney General

CLARK RENT ERVIN
Deputy Attorney General - General Counsel

ELIZABETH ROBINSON
Chair, Opinion Committee

James E. Tourtelott
Assistant Attorney General - Opinion Committee
