     .




                        The Attorney             General of Texas
                                            May 5,        1980

MARK WHITE
Attorney General


                   Honorable Robert Bernstein, M.D.               Opinion No. NW-17 9
                   Acting Commissioner of Health
                   Texas Department of Health                     Re: Whether the Department of
                   HO0 West 49th Street                           Health may purchase supplies from
                   Austin, Texas 78756                            a business owned by a member of
                                                                  the Texas Board of Health.

                   Dear Dr. Bernstein:

                         You have requested our opinion as to whether the Texas Department of
                   Health may purchase supplies from e business owned by a member of the
                   Board of Health.

                          The Texas Board of Health employs the Commissioner of Health, who
                   is designated the “executive head of the Department.” Articles 44l8a, 44184
                   V.T.C.S. The Commissioner is required to “perform the duties assigned to
                   him by the Board,” and he %erve[sI at the will of the Board.” Id Article
                   4419c, V.T.C.S., prescribes to the Department certain duties withxgard    to
                   the treatment of crippled children:

                                 Sec. 3. The Crippled Children’s Division of the
                              State Department of Health is empowered to take
                              census, make surveys and establish permanent records
                              of crippled children end children who have cancer; to
                              procure medical and surgical service for eligible
                              children,   provided   that only physicians      legally
                              qualified to practice medmme and surgery in Texas
                              be employed for purposes of diagnosis and treatment,
                              that not more than the customarv minimum fees be
                              paid for such services, and that ph&!icians or surgeons
                              so employed shall be approved by the State Board of
                              Health as qualifuxl to render such servme; to select
                              and designate hospitals for the care of children
                              contemplited    by this Act, and to take such other
                              steps as may be necessary in order to accomplish the
                              purposes of this Act.




                                                     p.     568
Honorable Robert Bernstein, M.D.      -   Page Two     (MW-179)



              At the discretion         of the State Department       of Health,
           transportation,    appliances, braces and material necessary in the
           proper handling of crippled children or children who have cancer
           may be in part or entirely provided. Such appliances, braces and
           materiel, beurz a Dart of the care and treatment         orosram and
           necessary to be Physical restoration of the individuei crippled
           child as defined in this Act or a child who has cancer, shell not be
           considered to be state-owned         personal property and shall be
           excluded from the personal property inventory required of state-
           owned property; and all such property including appliances, braces,
            end materials, being a part of the care and treatment program, and
           which are now being accounted for under the provisions of the
           present system of eccounting shall be deleted from end not
           required after the passage and effective date of this Act          The
           State Department of Health, however, shall maintain at all times a
           complete record of such appliances, braces and materials provided
           and such records shall be verified by the State Auditor.
              The State Department of Health is directed to provide in Rules
           and Regulatrons, the necessary details for the conduct of this work.
           in accordance with the pure&es of this Act, which shall ermit &
           far as possible, the free choice of patients in their --=7-
                                                                  selections o
           physicians and hospitals, and shall arrange with hospitals, brace
           departments     and other services providing for crippled children’s
           work and children who have cancer, compensation               for such
           sees,       provided that such fees or charges shell not exceed the
           average charges for the same services rendered to patients in the
           hospitals approved for purposes of this Act.

(Emphasis added).

       The Board of Health approves a list of physicians qualified to treat crippled children,
and designates hospitals for their care. Within the ambit of these statutory guidelines, a
patient eligible for services under article 4419c, V.T.C.S., selects his own physician, and if
a brace or appliance is prescribed for the patient, the physician selects a supplier to
furnish the brace. The supplier then submits a state purchase voucher to the Department
of Health for payment. You ask whether such payment is permissible when the supplier is
en entity wholly or partially owned by a member of the Board of Health.

      In Attorney General Opinion MW-124 (1980), we held a similar arrangement to be
void in which a county purchased crushed rock from a company which stored the material
at one of five quarries, one of which was partially owned by a county commissioner, who
received a royalty for each truckload of rock removed from his quarry. We described this
arrangement as one involving

           a contract and claims against the county in which a public official
           has an indirect pecuniary interest, at least, and perhaps a direct
           one.




                                            P-   569
Honorable Robert Bernstein, M.D.     -    Page Three     (Mw-179)



Although Opinion MW-124 (1980) was based largely upon the applicability of article 2340,
V.T.C.S., which requires every county commissioner to take an oath that “he will not be
directly or indirectly interested in any contract with, or claim against, the county in
which he resides,” it also referred to the long established state policy that

           a contract between a public official and the public body of which
           he is a member is contrary to public policy and therefore void, if
           the official has any personal pecuniary interest in the contract.

See also Attorney General Opinion MW-34 (1979). See Meyers v. Walker, 276 S.W. 305, 307
(Tex.Civ.    App. - Eestland 1925, no writ). See%0      m                             378
S.W.2d 126 (Tex. Civ. App. - San Antonio 1964, writ ref’d nr.e.1; Starr County v. Guerre,
297 S.W.2d 379 (Tex. Civ. App. - San Antonio 1956, no writ).

      This office has frequently applied the public policy rationale of Meyers v. Walker,
s ra even when no statute was present to render the contract void In Attorney General
*-pu-uon H 916 (1976), it was held that a school district was without authority to contract
with a company which employed a member of the district’s board of trustees in a
managerial capacity.     In Attorney General Opinion H-734 (1975), this office said that a
school district should not contract with one of its trustees to furnish garbage pickup, even
though the trustee operated the only garbage pickup service in the area.             See also
Attorney General Opinions M-1236 (1972); WW-1362 (1962); O-2306 (1940); O-1589(1939);
O-878 (1939). -See art. 6252-9b, V.T.C.S., §S 6, 8 (statement of general state policy).

       In the present instance, a member of the Board of Health presents for payment by
the Board of Health a purchase voucher for supplies furnished to a third person. In our
opinion, payment of such a claim is prohibited by the doctrine of Meyers v. Walker, S
                                                                                 .F ram a
It is therefore our view that the Department of Health should not purchase supplies
business owned by a member of the Board of Health.

                                         SUMMARY

           The Department of Health is prohibited by the doctrine of Me ers
           v. Walker, 276 S.W. 305 (Tex. Civ. App. - Eastland 1925, no-5 writ
           from purchasing supplies from a busines wholly or partially owned
           by a member of the Board of Health.




                                              MARK     WHITE
                                              Attorney General of Texas

JOHN W. FAINTER, JR.
First Assistant Attorney General




                                              P.   570
Honorable Robert Bernstein, M.D.   -   Page Four (MW-179)



TED L. HARTLEY
Executive Assistant Attorney General

Prepared by Rick Gilpin
Assistant Attorney General

APPROVED:
OPINION COMMITTEE

C. Robert Heath, Chairman
Susan Garrison
Bob Gauss
Rick Gilpin
Bruce Youngblood




                                           P.   571
