                                                   The Attorney     General of Texas
                                                                  March 15, 1984
      JIM MATTOX
      Attorney General



      Supreme      Court Building             Ms. Rita Howitz                       Opinion   No.   JM-137
      P. 0. Box 12548                         Executive Director
      Austin,    TX. 78711. 2548              State Pen&o" Review Board             Re:  Whether a hospital authority
      512/475-2501
                                              P. 0. Box 13498                       must  register  with the State
      Telex    9101874-1367
      Telecopier     5121475.0266
                                              Austin, Texas   78711                 Pension Review Board

                                              Dear Ms. Howitz:
      714 Jackson,    Suite 700
      Dallas,   TX. 75202-4506
      2141742-8944
                                                   Chapter 12 of title 1lOB. V.T.C.S., imposes various requirements
                                              on  "public retirement systems." Section 12.001(2) of title 1lOB
                                              defines such a system as:
      4824 Alberta        Ave., Suite   160
      El Paso, TX.        79905.2793                    a   co"ti"ui"g. organized program of service
      9151533-3484
                                                        retirement. disability retirement, or        death
.fl                                                     benefits for officers or employees of the state z
       JO1 Texas,        Suite   700                    a political subdivision, other than a program
      Houston,     TX.     77002~3111                   providing only workers' compensation benefits, a
      7131223.5888                                      program administered by the federal government,
                                                        Of . . . . (Emphasis added).
      806 Broadway.         Suite 312
      Lubbock,     TX.     79401-3479         You
                                              .    have asked whether the Richardson Hospital Authority          is     a
      806,747.5238                            "political subdivision" within the meaning of this provision.

                                                   Section 3 of article 4494r. V.T.C.S., authorizes counties to
      4309 N. Tenth. Suite B
      McAllen,     TX. 78501.1685
                                              create county hospital authorities, and it expressly provides that
      5121882-4547                            such authorities are "political subdivision[sl of this State." On the
                                              other hand, section 3 of article 4437e, V.T.C.S., which authorizes
                                              cities to create city hospital authorities, such as the Richardson
      200 Main Plaza. Suite 400
      San Antonio,  TX. 78205.2797
                                              Hospital Authority, does not provide that such authorities are
      5121226-4191                            political subdivisions. We must determine whether the failure of this
                                              latter provision to so provide means that the legislature did not
                                              intend for city hospital authorities to be classified as political
      An Equal      Opportunity/              subdivisions, or whether the omission of the words "political
      Affirmative     Action     Employw
                                              subdivision of this State," which appear in section 3 of article
                                              4494r, was a mere oversight on the legislature's part.

                                                   Bole" V. Board of Firemen, Policemen and Fire Alarm Operators'
                                              Trustees of San Antonio, 308 S.W.2d 904 (Tex. Civ. App. - San Antonio
                                              1957, writ ref'd), sets forth the criteria that are generally used in
                                              determining whether a" entity is a "political subdivision." There,
r                                             the court stated:



                                                                           p. 583
Ms. Rita Horwitz - Page 2   (m-137)




          A political subdivision contemplates: geographical
          ares and boundaries, public elections, public
          officials, taxing power and a general public
          purpose or benefit.

Id. at 905. The second of these criteria was recently modified sub
xentio    by the Texas Supreme Court.         In Guaranty Petrol=
Corporation v. Armstrong, 609 S.W.2d 529, 531 (Tex. 1980). the court,
distinguishing between a "political subdivision" and "a department,
board or agency of the State," stated that

          [mlembers of the governing body of a pollti~cal
          subdivision are elected in local elections or are
          appointed by locally elected officials. (Emphasis
          added).

     County hospital authorities clearly meet at least four of these
five criteria. They have geographical area and boundaries. V.T.C.S.
art. 4494r, 63. Members of their boards of directors are appointed by
the governing bodies of the counties that created them. Id. 04. Said
members are unquestionably "public officials."        Finxy,    county
hospital authorities certainly promote "a general public purpose or
benefit." County hospital authorities do not, however, have taxing
power; instead, they have bonding authority.         Id. 97 et seq.
Notwithstanding the fact that county hospital authorities do not
technically meet all five of the Bole" and Guaranty "political
subdivision" criteria, however, such authorities clearly are political
subdivisions, because section 3 of article 4494r declares that they
are.

     Like a county hospital authority, a city hospital authority has
geographical area and boundaries, article 4437e. section 3, V.T.C.S.,
and a board of directors appointed by the city that created it. Id.
64.   These directors are certainly "public officials," and the
authority promotes "a general public purpose or benefit." Like county
hospital authorities, moreover, city hospital authorities have bonding
rather than taxing power. Id. P7 et seq. As noted, however, city
hospital authorities are not expressly designated as "political
subdivisions."

     In our opinion, however, city hospital authorities should be
deemed "political subdivisions" within the meaning of section 12.001
of title 1lOB. Only in a very literal sense do such authorities fail
to meet the "taxing power" criterion of Bole" and Guaranty; one could
reasonably argue, moreover, that this criterion is technically met,
since bonding authority could be deemed an adequate substitute for
taxing power, at least for purposes of this criterion. Even if this
criterion is not precisely met,     however, to conclude that city
hospital authorities are for this reason not political subdivisions




                               p. 584
     ,   -


             Ms. Rita Horwitz - Page 3   (JM-137)




             is, in our view, to give entirely too much weight to what is at best a
             flimsy distinction.

                  Even more compelling is the fact that county and city hospital
             authorities meet the Bole" and Guaranty "political subdivision"
             criteria to precisely the same extent. Given this fact and the fact
             that county and city authorities are otherwise so similar, we can
             perceive no logical reason why the legislature would have wanted to
             include the former within the ambit of the term "political
             subdivision" but exclude the latter. We do not believe it would have
             intended to subject only the former to the requirements of chapter 12
             of title 1lOB.

                    Section 3 of article 4437e was enacted in 1957. Acts 1957, 55th
             Leg., ch. 472 at 1379. Section 3 of article 4494r was enacted in
             1963. Acts 1963, 58th Leg., ch. 122 at 324. One reason why only the
             latter mentions "political subdivisions" might be that when the
             legislature enacted this provision, it simply neglected to amend
             article 4437e. If section 3 of article 4437e had been enacted after
             section   3 of article 4494r, we believe the omission of any reference
             to "political subdivision" would be far more meaningful. Since the
             reverse occurred, however, we believe it is more likely that when it
/4           enacted article 4494r, the legislature simply was not concerned with
             article 4437e and therefore paid no attention to it.

                  For the foregoing reasons, we conclude that the Richardson
             Hospital Authority is a "political subdivision" within the meaning of
             section 12.001 of title 1lOB.

                                           SUMMARY

                          The   Richardson Hospital Authority  is  a
                       "political subdivision" within the meaning of
                       section 12.001 of title llOB, V.T.C.S.




                                                     JIM     MATTOX
                                                     Attorney General of Texas

             TOM GREEN
             First Assistant Attorney General

             DAVID R. RICHARDS
             Executive Assistant Attorney General




                                            p. 585
                                             -   I




Ha. Rita Horwitz - Page 4    (JM-137)




Prepared by Jon Bible
Assistant Attorney General

APPROVED:
OPINION COMMITTEE

Rick Gilpin, Chairman
Jon Bible
Colin Carl
Susan Garrison
Patricia Ajnojosa
Jim Noellinger
Nancy Sutton




                                    p. 586
