                        December    23,    1948

Hon. Ted R. Alexander                Opinion       No, V-755.
Bond Investment    Adviser
Board of iducation                   Re: Authority    of State Board
Austin,  Texas                           of Education     to invest
                                         Permanent    School Fund in
                                         Hospital   Bonds issued    by
                                         Board of Regents      of The
                                         University    of Texas.
Dear Sir:
             Ws quote     from your       recent    letter   as follows:
               “At the Novembe,r 8, 1948 meeting               of the
      State Board of Mucation,              the Board of Re-
      gents of the University            of Texas offered         for
      sale to the State Board of &ducation                   #J,OOO,-
      000.00 3% Hospital          Bondsproposed          to be le-
      sued by the Board of Regents               of the University
      of Texas pursuant          to the constitution          and
      laws of the State          of Texas, and particularly
      the provisions         of Chapter     5a Acts of the Sec-
      ond Called       Session    of the 43rd Legislature,
      as amended (Article           26030VACS). These bonds
      are not to be and will not constitute                   an ln-
      debtedness       of the State of Texas, but are
      special      obligations      to be issued       by and in
      the name of the Board of Regents                 of the Uni-
      versity      of Texas, and will be payable              both am
      to principal        and interest,       solely     from a oomr
      pulsory      group hospitalization           fee to be im-
      posed on each student           as a pre-requisite          to
      registration        in the Main University,            not to
      exoeed $4.00 per student            for any semester          or
      for any one summer session,              and from any‘oth-
      er net revenues          of the proposed        hospi tale
             “The State Board of Education        authorized
     ‘the purohase    OS said bonds as an investment
      ror the Permanent     School Fund, subject        to an
      opinion   of the Attorney    General   that the
      Board has the authority      to invest    the State
      Parmqnent School Fund in bonds of this typea
Hon.    Ted R. Alexander,      page 2 (V-755)


        The State Board of Education,       therefore,     re-
        spectfully   requests   your opinion    whether    the
        proposed   bonds herein   above described      are an
        authorized   investment   for the Permanent       Sohool
        Fund of Texas under the laws of this State.”
             Assuming the 3% Hospital       Bonds under consid-
eration  will bear the approval         of the Attorney   General
in accordance    with Article     2670,   V. C. S., we look to
Article   2669,  V. C. S., as amended, which authorizes           the
State Board of dduoation        to invest    the public free school
funds in certain     designated    bonds.
              Article   2669   provides:
               “The State  Board of Rduoation         is author-
        ized and empowered to invrst         the permanent
        public   free school funds of the State          in
        bonds of the United States,        the State of Texas,
        or any county thereof,       and the independent         or
        common school districts,       road precinots,       arain-
        aga, irrigation,    navigation     and levee districts
        in this State,    and the bonds of incorporated
        cities   and towns, and oblinations         and pledges
        of the University    of Toxs8.v       (timphasis added7
              This statute  is the         enabling  law enacted   pur-
suant    to Section   4 of Article         VII, Constitution    of Texas,
which    reads in part:
                1,e D D, The Comptroller    shall  invest  the        “’
        proceeds      of such sales and of those hereto-
        fore made as may be directed         by the Board of
        Education      herein provided   for, in the bonds
        of the United States,        the State,   or in such
        other     securities  and under suoh restriotions
        as may be prescribed       by law 0 0 n * (Em-s
        added.)
             The first   such enabling     statute   appears     in
Acts 1905,     page 263.    It was later    amended in Aots 190%
page 216.     gaoh amendment including        the last,     Aots 1929,
41st Leg:., page 573# Soction        1, designated      other bonds
in which the Board of Education         was authorized       to invest
the State permanent      public   free school fund.’ The bonds
described    in your letter     could only come under a class-
ification    such as that added by the amendment of 1929,
wherein   the said Fund was permitted         to be invested      in
Ron. Ted R, Alexander,           pago 3 (V-755)


*obligations   and pledges of the             University      of Texas.”
A. G, ,Opinion No. O-3428.
                These hospital      bonds to be issued and sold by
the Board of Regents           of the University        of Texas acting
under authority         of Articles     2589~ and 2603~,V, C. SOS
are revenue       bonds as distinguished          from bonds voted by
the people and supported            by taxation.        Article’260jo,
Section     3, specifically        provides   that “any bonds Q 0 o
issued     hereunder     shall   not be an indebtedness            of the
State    of Texas, but shall          be payable     solely     from the
revenues      to be derived      from the operation         of such
buildings.      * Further D “the fees and charges               (Section     2)
thus fixed along with all other income. therefrom                      shall
be considered        as revenue derived       from the operation            of
the buildings        thus constructed.*          Clearly,     the bond ls-
sue thus created         and sold would oonstitute            a pledge of
the University         of Texas.
            Further,    Article     2589~ specifically     authoriz-
es the Board of Regents         of The University      of Texas “to
build,  equip,   operate)     and maintain     a hospitaln    under
Article  2603~,and to levy and colleot ~the fee not to
exceed $4.00 per student         per semester*
               It is pertinent    to note that when Artiole         2669
 was last    amended in 1929, It was amended purposely            to
 enable   the Board of Education        to invest    the Public   Free
 Sohool Fund in obligations         and pledges     of The University
 et Trxoe involving       the revenues    b the Available       Univer-
 sity ,Fund,      See emergency   clause   of j, B. 1131 4lst
 ws. I page 575# Acts 1929,          The University     Available
~Fund consists      of revenues   of the University      Permanent
 Fund.    Article    2592, V, C. S.
               Thr provision      in Article     266g9 as amended,
authorizing        the Board to invest        the public     sohool~fund
in “obligations        and pledges      of The University         of Texas”
is clear      and.unambiguous.        Its intent      is plain,      not re-
&;ing       the invocation       of rules     of statutory      oonst2uo-
          This being true,        expressions      in the emergenay
clauie    cited may ‘not be invoked for the purpose of rais-
ing an ambiguity         in a statute,      or to control       its plaim
meaning or purpose.          39 Tex, Jur., page 228,           Nor wouI4
the fact that Article          2603~ was first        enacted     in:1934,
subsequent       to Article    2669 as amended in 1929, require,
in our opinion,        a holding     contrary     to that expressed
herein,      Article    2669 is a general        law and nowhere
therein     does it limit      its application        to specific       obli-
Hon.   Ted R. Alexander,        page 4 (V-755)


gations    and pledges. He need only to determine       that
the bonds under consideration    constitute    an obligation
and the pledge of The University     of Texas.    We have so
determined    0
               It is our opinion,         therefore,       that the State
Board of Xducation         is authorized        under Article       2669,
v. c.    s     as  amended,   to   invest     the    public    free   school
fund of’$exas        in the hospital       bonds to be issued          and
sold by the Board of Regents             of The University          of Texas
acting     under authority      of Articles        25890 and 2603c, V.
c. s.,     as  amended,    when  same    have    been    approved    by the
Attorney      General.


              The State Board of Mucation         has author-
       ized under Article       2669, V, C, S., as amended,
       to invest    the public    free school fund of Texas
       in hospital     bonds to be issued and sold by the
       Board of Regents     of The University       of Texas
       acting   under authority      of Articles    2589~ and
       2603, v. c. ii.,as amended after           the same
       have been lawfully      authorized     and have been
       approved    by the Attorney     General,
                                                  Yours     very   truly,
                                            ATTORNXY GliXZRALOF TiXLS



                                                  Chester     &. Ollison
       CiO:wb:bh                                               Assistant


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