’   ,




                        THE   ATTORNEY    GENERAL
                                 OF TEXAS



                                  August 28, 1989



        Honorable Abelardo Garza       Opinion No. JR-1090
        Duval County Attorney
        P. 0. Drawer M                 Re: Authority of a county judge
        San Diego, Texas   78384       to sell prescription  drugs to
                                       indigents for reimbursement  by
                                       the county  (RQ-1696)

        Dear Mr. Garza:

             you state that the county judge of Duval County is a
        licensed pharmacist who owns the only drug store in the City
        of Freer in Duval County.    Aside from this pharmacy,   the
        nearest pharmacies in the county are 25 and 27 miles    from
        Freer. Before the county judge assumed office,      indigent
        persons used vouchers    approved by the county      welfare
        department to buy medicines   from his dNg store, and he
        submitted them to the county for payment. &B Local Go-."t
        Code 8 115.021 (commissioners court shall audit and settle
        all accounts against the county-and direct their payment).
        You ask whether    the pharmacist may continue   to provide
        medicines to indigent persons    for reimbursement   by the
        county now that he is county judge.

                Section 81.002 of the Local Government Code provides in
        part:

                      (a) Before undertaking the duties of the
                  county judge or a county commissioner,     a
                  person must take the official oath and swear
                  in writing   that the person will not be
                  interested,  directly or indirectly,    in a
                  contract with or claim against the county
                  except:

                           (1) a contract or      claim   exnressly
                     authorized bv lay; or

                            (2)  a warrant issued to the judge or
                      commissioner as a fee of office.
                      (Emphasis added.)




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Local Gov't Code 8 81.002.    The underlined language in the
above provision was added by a 1981 amendment to article
2340, V.T.C.S.,   now recodified   as section 81.002 of the
Local Government  Code.  Acts 1981,  67th Leg., ch. 527, 5 3,
at 2230    (amending V.T.C.S.    art. 2340   (1925) (repealed
1987)).

     Prior to the 1981 amendment,     article 2340, V.T.C.S.,
and its predecessors    incorporated the strict common       law
policy which prohibits contracts between a governmental body
and a private entity in which a member       of that body     is
interested.    See. e.cr., Bexar Countv v. Wentworth,        378
s.W.Zd 126 (Tex. Civ. APP. - San Antonio 1964, writ ref'd
n.r.e.) (invalidating contract entered into.in violation      of
article 2340, V.T.C.S.); see also Kninna v. Stewart         Iron
Works, 66 S.W. 322 (Tex. Civ. App. 1902, no writ)      (commis-
sioner may not enforce an assignment of a contractor's claim
against the county). The 1981 enactment which added the
underlined exception to article 2340 also adopted        article
988a, V.T.C.S.     This provision,   now codified   as section
271.902 of the Local Government Code, authorizes a county to
make purchases from a cooperative     association even though
one or more members of its governing body belong to it and
might indirectly benefit from the purchase through increased
dividends.   Acts 1981, 67th Leg., ch. 527, 8 1, at 2229: ~99
Attorney   General Opinion    H-624   (1975) (article      2340,
V.T.C.S., barred county from contracting with a cooperative
in which a commissioner had a small interest).      The excep-
tion added to article 2340 -ensured that counties would get
the benefit of the legislative     change in the common     law.
See Bill Analysis,     H.B. 450, 67th Leg.       (1981).     The
exception was, however,   stated in expansive   terms and was
not limited to a county's transactions with a cooperative.

     In 1983 the legislature adopted article 988b, V.T.C.S.,
now codified as chapter 171 of the Local Government     Code,
establishing financial disclosure  and recusal requirements
for a local public officer who has a substantial interest in
a business entity that will receive an economic benefit from
an official action by the governmental body on which      the
officer serves. Local Gov't Code 88 171.003, 171.004.     See
Acts 1983, 68th Leg., ch. 640, at 4079.     An official   who
knowingly fails to comply with these requirements commits an
offense punishable as a Class A misdemeanor.     Local Gov't
Code 8 171.003. A violation of chapter    171 does not make
the action of the governing body voidable unless it would
not have been approved without the vote of the person who
violated   the   chapter.   Local   Gov't   Code    § 171.008
(renumbered as section 171.006 by Acts 1989, 71st Leg., ch.
1, 8 40, at 46).



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     This enactment thus modifies the strict common-law rule
which would have invalidated those governmental actions even
if the interested official had not participated.   &S   Local
Gov't Code 8 171.007 (as amended, Acts 1989, 71th Leg.,
chapter 1, at 47, incorporating  into chapter 171 an amend-
ment to art. 988b, V.T.C.S., adopted by Acts 1987, 70th
Leg., ch. 362): see also Attorney General     Opinion JM-424
(1986). Instead, it permits the transaction but forbids the
interested official  from. participating  in it, enforcing
these requirements by subjecting him tb criminal    liability
for violations.

    Chapter 171 defines "local public officialt' as follows:

        a member   of the aovernins bodv or another
        officer, whether  elected, appointed,     paid,
        or unpaid,   of anv district    (includins    a
         chool   district).   county,    municipality,
        :recinct . . . or other local governmental
        entity who exercises responsibilities    beyond
        those that are advisory in nature.    (Emphasis
        added.)

Local Gov't Code 5 171.001(l).

     The commissioners  court is the governing body of       a
county. See Tex. Const. art. V, 5 18. Members         of the
commissioners   court are local public officials        within
chapter 171 and are subject to its provisions and procedures
for transactions   in which a member   of the court has a
substantial   interest.    In  our opinion,     chapter    171
authorizes the commissioners court to enter into a contract
or approve a claim in which the county judge or a commis-
sioner has a pecuniary interest, as long as it complies with
the requirements of this legislation.  The claim or contract
which arises under authority of chapter 171 is 'Ia contract
or claim expressly authorized by law" within the exception
to section 81.002 of the Local Government Code.

     This construction of the two provisions is supported by
the rule that statutes  in pari materia should be construed
together, giving effect to both, if possible.      See. e.a.,
Duval Core. v. Sadler, 407 S.W.2d 493 (Tex. 1966): Conlev v.
Dauahters of the RenubliG  156 S.W. 197 (Tex. 1913): Allen
v. Texas Deu't of Public 'Safetv 411 S.W.2d 644 (Tex. Civ.
APP. - Texarkana  1966, no writ):   Both section 81.002 and
chapter 171 of the Local Government Code deal with conflicts
between a county commissioner's   private economic   interest
and his official duty to participate in decisions on the




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expenditure of county    funds or the use of other county
resources.   As statutes on the same subject, they are to be
COnStNed   together and any apparent inconsistencies are to
be harmonized.     See. e.a     Conlev      D aht r    of the
Reoublic,   suora.   AccordiAgly,   a &sa%one       shat   the
commissioners court enters into in compliance with chapter
171 of the Local Government    Code will not be invalid under
section 81.002 even though the county judge has an economic
interest in it. Transactions not authorized by chapter     171
or section   271.902 are still subject to section     81.002.1
See Attorney General Opinions JM-1006 (1989): JM-927 (1988);
Letter Opinion 88-127 (1988); see also Letter Opinion    88-40
(1988) (reserving question on whether chapter 171 applied to
transaction).

     Attorney General Opinion JM-855     (1988) stated that
chapter 171 did not expressly authorize     a county  commis-
sioner to contract with the county. This opinion determined
that section   81.002 barred a county commissioner       from
leasing space from the county to operate a private business.
The facts presented   in Attorney   General Opinion    JM-855
indicated that chapter 171 would not apply to the lease
transaction in any case. Thus, chapter 171 did not except
that proposed transaction from section 81.002. The state-
ments made by Attorney   General Opinion JM-855    about the
relationship of section 81.002 and chapter 171 of the Local
Government Code should be limited to the fact situation
addressed  by that opinion and not applied to          county
contracts generally.

     You suggest that section 171.005 of the Local Govern-
ment Code prohibits     the  county judge from      providing
prescription  medicines   to indigent persons    and seeking
reimbursement from the county.    This provision   states as
follows:

           The governing   body of a     governmental
        entity may contract    for the purchase     of
        services or personal property with a business



     1. House Bill 1976 of the 71st Legislature        amends
section 81.002 of the Local Government Code to allow members
of the commissioners court to serve as officers of certain
other entities, subject to the provisions   of chapter   171.
This bill becomes effective on August 28, 1989. Acts    1989,
71st Leg., ch. 475, § 1, at 1647.




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    Honorable Abelardo Garza - Page 5   (JM-1090)




            entity in which a member of the governing
            body has a substantial    interest if    the
            business entity is the only business  entity
            that

                (1) provides  the    needed   service
            product within the     jurisdiction   of    2:
            governmental entity: and

               (2)   bids on the contract.

    Local Gov't Code 5 171.005    (repealed 1989).   We need not
    consider whether the quoted provision    would prohibit  your
    transaction, because~ it was repealed in 1989.

         In adopting the Local Government    Code in 1987, the
    legislature recodified and repealed article 988b, V.T.C.S.
    Acts 1987, 70th Leg., ch. 149, gg 1, 49(l). Section 5(a) of
    article 988b, V.T.C.S., was recodified as section 171.005 of
    the Local Government Code.   The same legislature adopted an
    amendment to article 98833 repealing the language quoted as
    section 171.005 and replacing it with an entirely  different
    provision.   Acts 1987, 70th Leg., ch. 362, § 5. In these
    circumstances, we apply the following rule from the Code
    Construction Act:

            The repeal of a statute by a code does not
            affect an amendment . . . of the statute by
            the same legislature  that enacted the code.
            The amendment . . . is preserved   and given
            effect as part of the code provision     that
            revised the statute so amended . . . .

    Gov't Code § 311.031(c). Accordingly, the provision set out
    as section 171.005 of the Local Government     Code has been
    repealed and may be disregarded.   The 71st Legislature   has
    adopted a bill which incorporates into chapter 171 of the
    Local Government   Code the amendments     to article   988b,
    V.T.C.S., adopted by the 70th Legislature.   Acts 1989, 71st
    Leg., ch. 1, 5 40, at 45 (effective August 29, 1989).     The
    language quoted above as section 171.005 does not appear   in
    section 171.005 as adopted by the new bill or in any other
    provision of chapter 171 included therein. The county judge
    may provide medicines to indigent persons for reimbursement
    by the county in accordance  with the provisions of chapter
    171 of the Local Government Code as amended.




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Honorable Abelardo Garza - Page 6    (JM-1090)




                       SUMMARY
           Chapter 171 of the Local Government   Code
        applies to transactions between a county and
        the county judge or another member    of the
        commissioners court.   Transactions that are
        not subject to chapter 171 are still subject
        to section   81.002 of the Local Government
        Code.




                                   JIM     MATTOX
                                   Attorney General of Texas

MARYKELLER
First Assistant Attorney General

Lou MCCREARY
Executive Assistant Attorney General

JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Susan L. Garrison
Assistant Attorney General




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