Honorable J. R. Singleton           Opinion No. M-668
Executive Director
Texas Parks and WlldllPe Dept.
John Ii.Reagan Building             Rc: Whether the Texas Parks
Austin, Texas 78701                     pti Wildlife Department
                                        may exchange Its nego~ti-
                                        able coupon bonds with
                                        the low bidder POP such
                                        bonds, for land owned
Dear   Mr.   Singleton:                 by the low bidder.
     Weare In receipt of your request for an opinion of this
office as to whether:
       1. The Texas Parks and Wildlife Department has
       authority to exchange it6 negotiable coupon "State
       of Texas Park DevelopmentBonds" for a tract of
       land to be developed Into a State Park;
       2.  The owner of suitable land who Is the success:
       ful bidder for such "State of Texas Park Develop-
       ment Bonds" may receive such bonds in exchange
       for hYs la&;
       3.  The State Parks and Wildlife Departmentmay
       purchase land suitable for a park site from the
       owner of such land who is also the successful
       bidder for "State of Texas Park DevelopmentBonds".
     The relevant statute Is Article 607Qh, Vernon's Civil
statutesD I'taSection 4 prescribes the requirementsfor the
sale and issuance of,,Stateof Texas Park DevelopmentBonds,
and states In part,      . The proceeds from,the sale of any
bond, or bonds, shall'ba used for the purpose of creating the
Texas Park DevelopmentFund . D .'I* Section 7 of the Statute
requlr$s that bidders~forthe bonds must accompany their bids
with,        exchange or bank cashlerls check for such sum aa
fihe De&tk%dz~   may consider adequate to be a forfeit guaran-
Eeielngthe accgptance and payment for all bonds covered by
such bids and accepted by the department." Section 9 provides


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Honorable J. R. Singleton, Page 2     (M-668)


for the creation of special funds for administering'I.     the
moneys provided for In this Act i . .'I. One of these f&s Is
the Texas Park DevelopinentPutidinto which the proceeds of
bond sales are required to be placed by Section 4. Section
9-C provides for the investment of moneys in the Texas Park
DevelopmentFund.
     The quoted portions of Article 6070h clearly contemplate
that "State of Texas Park DevelopmentBonds" ape to be sold
competitivelyfor cash, and cannot therefore be exchanged for
land?
       In reply to your third question, we know of no prohibition
against the purchase of land by-the department from a person
or a corporationwho might be the successfulbidder in the
sale of "State of Texas Park DevelopmentBonds" provided there
has been compliancewith all the statutory requirementsfor the
competitivesale of the bonds for cash, at par value with
accrued interest from their date.
     An analogous situation 1s described In the case of 0
Dies, 176 S,W. 638, (Tex.Civ.App.1915, no writ), where dF
successful bidder on a contract to construct county roads was
also the successfulbidder for the,,purchase of the county bonds
;e&g sold to finance the same roads. The court said, at page
   *
       11
              The law does not prohibit a county from
       s;liiAg bond'sto contractorsfor public works
       for the constructionof which the bonds are
       issued. The statute forbids the sale of bonds
       of this character for less than par value and
       accrued interest; . . .'I
The court further said that such a transactionIs valid only
where there has been strict compliancewith all‘statutory
requirementafor the sale of the bonds and conversely is
invalid where the transactionis used ia a shield ,forthe
sale of the bonds for lea&than their par value and accrued
interest.
     This case in prinqiple supports our holding that the
Parks and Wildlife Department may not pay in excess of the fair
market value of the land in question so as to let the seller
of the land recoup his loss for the purchase of bonds at an
unfavorable interest rate in the current market.

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Honorable J. R. Singleton, Page 3     (M-668)



                    SUMMARY
    The Texas Parks and Wildlife Department Is
    authorized to sell its State of Texas Park
    DevelopmentBonds at par and accrued interest
    for cash only, and Is not authorized to ex-
    change bonds for land to be'developedas a
    park site.
    The department is authorized to buy land from
    the successful bidder for its bonds where
    there has been atriot compliancewith all the
    statutorr orovi,sionsgoverning~thesale of
    such bon&:




                                    C. MARTIN
                                    General of Texas
Prepared by Joseph
Assistant Attorney
APPROYED:
OPINION COMMITTEE
Kerqs Taylor, Chairman
W. E. Allen;~Co-chairman
Roger Tyler
John Reeves
Arthur Sandlin
James Quick
MFiADEF. GRIFFIN
Staff Legal Assistant
ALFRED WALKER
Executive Aesistant
NOLA WHITE
First Assistant



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