.-




                TEEEAYYIWEZNEY          GENERAL.
                               ~,PTEFCAS~


                               March 31, 1966

     Honorable John Connally
     Governor of Texas
     State Capitol
     Austin, Texas
          Attention:   Mrs. Carter Clopton
                       Executive Director
                       Governorts Con&ttee      on Aging
                       Opinion Co. C-644
                       Re:     Whether contracts   between the Governor's
                               Committee on Aging and certain enumerated
                               entitles  can be legally  entered into for
                               the purposes stated.
     Dear Governor Connally:
            You have requested the opinion of this office     a.6 to
     the subject question.    In this connection, the following    is
     quoted from your letter:
                   "Pursuant to Article    695k, Vernon's
            Civil Statutes,     enacted by the 59th Legls-
            lature,   this office    has adopted and promul-
            gated the Texas State Plan for Implementing
            the Older Americans Act of 1965.       In carry-
            ing out this Plan in accordance with both
            State and Federal purposes, it l.s anticipated
            that this office     will enter into contracts
            with other State agencies,      local political
            subdivisions,   private individuals,     corpora-
            tions and institutions,      whereby these entl-
            ties will perform services      ln keeping with
            the requirements of Article       6sk, and the
            Texas State Plan.
                   "It is anticipated     that some of the
            private agencies with which we contract
            will be either church-operated       or connected
            with religious    institutions.     These contracts
            will cover a wide range ofactivities,         and
            can include the conduct of training classes
            for field workers, the development of par-
            ticular   programs to benefit     the aging, and
                                -3228;
Hon. John Connally,      page 2 (C- 644)


        many other activities       in this   specialized
        field .
              “It haps been suggested that this office
        may not legally   obligate    itself    nor pay out
        State fundsto    a,rellglous     organization,    such
        being in violation’ of the constitutional         prln-
        ciple of separation     of church and state.       How-
        ever, in the instant case we would point out
        that there will be no grants or gifts of any
        kind made to any private individual’,        corpora-
        tion, agency or Institution,         but that contracts
        will be entered into and all payments will be
        made solely on the basis of services         rendered
        to the State.    We would very much appreciate
        the opinion of the Attorney General’s Office
        as to whether contracts      for the purposes set
        out above would be proper, and whether the con-
        tract amounts could properly be paid out of
        State funds. ”
        At the outset we must observe that no difficulty          is
presented when the Governor’s Committee on Aging, contracts
with other State agencies,      local political   subdivisions,     or
private individuals,    corporations   and institutions     that have
no religious  connection.     Such contracts    are within the author-
ity granted by Article     695k, Vernon’s Civil Statutes,       and the
State is in the position     of making payment for value received.
        The essential  problem presented for our determination   Is
the propriety   of the Governor’s Committee on Aging contracting
with an institution   or corporation  governed by a religious  sect
or denomination.
        Article   I,   Section   7, of the Texas Constitution,    reads
as follows t
              “Ho money’shall be appropriated,   or drawn
        from the Treasury for the benefit of any sect,
        or religious  society, theologICal   or religiOUS
        seminary; nor shall property belonging to the
        State be approptilated for any such purpose.”
The Texas State Plan for Implementing the.Older Americans Act
of 1965 is drafted In such a way that the Federal funds made
avallable  are paid out through the State In the form of pay-
ments for services   rendered under contract.     The question thus
becomes a matter of determining tither     State payment ?or ser-~
vices rendered by an institution    with a religious,  affillatlon
or connection  constitutes   money “drawn from the Treasury for

                                    -3129-
Bon. John Connally,       page 3 (C-644)


the benefit of any sect, or religious   society,   theological or
religious  seminary."  There is no Texas case law upon this
question,  and there has been only one prior Attorney General's
opinion issued that has directly   met this issu8.
         Attorney General's Opinion O-2412 (1940) W(LPwritten
in response to a question from the Director                of the Vocational
Rehabilitation      Division of the State Department of Education.
That agency was authorized to assist in the rehabllltation                     of
disabled persons in many ways, .one of which was to pay their
tuition at a college        or university.        Several lndividuals       had
expressed a desire to attend a denomlnatlonal                 school,   such as
Baylor, Southern Methodist or Texas Christian,                 and the Attorney
General's    office   was asked whether the payment of these handl-
capped persona' tuition         to such schools would constitute            a
benefit   to these sectarian         institutions      in violation    of Article
I, Section 7, of the Texas Constitution.                 It was concluded,       in
Opinion 2412, that such payment of tuition would not be a direct
benefit,    but would be an indirect           one that   was forbidden     bv the
Constitution.       In eupport of this proposition,            the opinion cited
thth,~m;~o;~;;n~            ;;;  ;g;;p       90 Tex. 205, 38 S.W. 24 {X.&36).
                                           on of whether a county's        indebted-
ness to the State authorized            the Comptroller of Public Accounts
to withhold payment of the county's pro rata share of the avail-
able school fund.        The law expressed by the Supreme Court regard-
ing this question has no bearing upon a question of what consti-
tutsa money paid for the benefit             of a religious      organization.
O-2412 was, in fact, based upon two cases from other jurisdlc-
tions:    Synod of Dakota vs. State, 2 S.D. 366, 50 N.W. 632 (1891),
and Wlll‘iams vs. Stanton Gramommon                  School District,      173 Ky.
708,ym??.          3Om.              Both of these cases are well-written
expressions     of the l&w and philosophy of their era.                The Synod
case is still      the law in South Dakota, but the Williams case has
been superseded-in       Eentucky.
         The Sunreme Courtcf  Kentuckv issued a 1andlPark Opinion
                                   vs: Effron, 310 IQ. 355; 220 S.W.
                                      toxte,       the State proposed
to pay tuition and certain other benefits      to assist in the opera-
tion of a school of nursing operated by a Catholic. hospital.
Although we have the added feature of contract,       the Kentucky situ-
ation was essentially   like ours, in that their statute was enact-
ed to enable the State to make use of Federal funds made available
for social purposes.    The essential   reasoning of Effron is express-
ed in the following   sentence,  taken frcnn page 83T

               "It is well settled    that a private agency
         may be utilized    as the pipe-line   through which
         a public  expenditure is made, the teat being not
         who receives    the money, but the character of the
         use for which it is expended."      (Pmpha8is added)

                                   3130-
Hon. John Connally,    page 4 (C-644)


Then, from page 838:
               “Manifestly,     the framers of our Constitu-
        tion did not intend to go so far as to prevent
        a public benefit,       like a hospital in which the
        followers   of all faiths and creeds are admitted,
        from receiving      State aid merely because it was
        originally    founded by a certain denomination
        whose members now serve on Its board of trus-
        tees.”
        The Effron case, supra, was the basis for the holding in
In re Opinion of the Justices,   113 A.2d 114 (Supreme Court, New
Iiampshire, 1955), wherein the Court discussed the conduit theory
of Effron, and made the following   observations:                I~

               “The purpose of the grant proposed by
        House Bill 327 Is neither to aid any parti-
        cular sect or denomination, nor all denomi-
        nations,   but to iurther the teaching of the
        science of nursing.      . . . the public funds
        will not be applied to sectarian     uses.   If
        some denomination incidentally     derives a
        benefit   through the release of other funds
        for other uses,, this result Is lmmaterlal.”
Since the Issuance of the Effron decision,         other Jurisdlct%ons
have also cited the case withapproval         and have adopted i$s
reasoning.    See Cral vs. Mercy Hospital-Street         Memorial,,‘209
Miss. 427    45 So.dog      (l’sRO)* Le#    vs. Ado-m                   14,
83 A.2d 185 (1951); Roe vs. Keiv c         42 m.TIrgl,     199 ~:$:'83 2
(1964).    And it shoume       pom&          that Kentucky, New.Bamp-
shire, Mississippi,    Connecticut and New Jersey all have coneti-
tutlonal   provisions  substantially   identical     to that of Texas as
regards aid or support to religious       institutions.
        With a very detailed        constitutional   provision    regarding
aid to a religious     institution,      the Supreme Court of South
Carolina decided, apparently with regret,           that it could not apply
the rationale   of,Effron     to its constitutional       roblem.    Parker
vs. Bates, 216 Som52,             56 S.E.2d 723 (19493.              -
          After a careful  analysis of Attorney Oeneralls Opinion
O-2+12 (l$+O), we are of the opinion that Its base rested COm-
pletely    on the persuasive,   but not binding, law of other jUria-
dictions.
       Based upon the authorities  cited herein, It ie, the opin-
ion of this .office that Attorney General’s   Opinion O-2412 (190)
should be, and it is hereby overruled.     It is the further opinion


                                -3131-
.    I




    lion.John Connally, page 5 (C- 644)


    of this office that the rationale of Kentucky Building Commis-
    sion vs. Effron, cited supra, is valid as a basis for inter-
    wing    Am      I, Section 7, Texas Constitution.
           You are therefore advised that it is the opinion of
    this office that +&e Governor's Committee on Aging may contract
    with religious Institutions for the performance of services
    that are within the scope of authority granted by Article 695k,
    Vernon's Civil Statutes, and the Texas State Plan for Implement-
    ing the Older Americans Act,of 1965.   You are further advised
    that any such payment of State funds may only be made to any
    private entity pursuant -to contract, and after performance of
    the service required by the said contract.

                             SUMMARY
             It is the opinion of this office that the
             Governor's Committee on Aging may contract
             with religious institutions for the perform-
             ance of services that are within the scope
             of authority granted by Article 695k, Vernon's
             Civil Statutes, and the Texas State Plan for
             Implementing the Older Americans Act of 1965.
             Any such payment of State funds may only be
             made to any private entity pursuant to con-
             tract, and after performance of the service
             required by the said contract.
                                        Yours very truly,
                                        WAGGQWER CARR
                                        Attorney General.




    MLQrms
    APPROVED:
    OPINION COMMITTEE
    W. V. Geppert, Chalrman
    Gordon Rouser
    Pat Bailey
    Kerns Taylor
    Roger Tyler
    APPROVED FOR TBE ATTORNEY GENERAL
    By: T. B. Wright
                               -3132-
