                                   The Attorney        General of Texas
   JIM MATTOX                                       July 11, 1986
   Attorney-General


  Supreme Court Building         Honorable Carlos VaLdez            Opinion No. JM-516
  P. 0. Box 12548
  Austin, TX. 78711. 2548
                                 Nueces County Attorxsy
  5121475-2501                   Courthouse, Room 205               Re: Validity of a contract between
  Telex 9101974.1387             Corpus Christi, Texw    78401      NUSCSS  County and an economic
  Telecopier   512l475.0296                                         development corporation

  714 Jackson, Suite 700
                                 Dear Mr. Valdez:
  Dallas, TX. 752U2609
  214/742-8944                        You have requested an opinion on the following question:

  4824 Alberta Ave., Suite 160
                                              Taking into consideration the fact that a
  El Paso, TX. 799052793
                                           county camlot be a dues-paying member of a chamber
  91515333404                              of commer':e.does Nueces County have the authority
                                           to contra':tfor business or industrial development
                                           services with a corporation that will in essence
,p’?l   Texas. Suite 700                   be an age:Y:yof a chamber of commerce?
    ,uston, TX; 77002.3111
  713&z?-5886
                                      A county's aut:hority to enter into a contract is limited to
                                 authority conferred on it, either expressly or by reasonable
  006 Broadway, Suite 312        implication, by thf! constitution or statutes. Canales v. Laughlin,
  Lubbock, TX. 794013479         214 S.W.2d 451, 45:) (Tex. 1948). A county has authority to promote
  006/747-5239
                                 the development of businesses and industries in the county through a
                                 county industrial commission established under article 1581g-2.
  4309 N. Tenth. Suite S         V.T.C.S., or through a board of development established under article
  McAllen, TX. 78501.1885        2352d. V.T.C.S.   A county may contract for services that the county
  512VS82.4547
                                 is authorized to perform itself. Attorney General Opinion JM-65
                                 (1983). Therefore, under articles 1581g-2 and 2352d. a county has
  200 Main Plaza, Suite 400      authority to contra<:11
                                                       for business or industrial development services.
  San Antonio, TX. 78205.2797
  512/2254191                         You are conwrned, however, about the relevance of a 1974
                                 attorney general ol'inion that concluded that a county could not pay
  An Equal Opportunity/
                                 dues to a chamber o:Fcommerce. Attorney General Opinion H-397 (1974).
  Affirmative Action Employer    In that opinion, th:Lsoffice held that article III, section 52, of the
                                 Texas Constitution ,prohibits a county from becoming a dues-paying
                                 member of a private corporation such as a chamber of commerce.
                                 Article III. section 52, provides, in part:

                                          Except as ,othewise provided by this section, the
                                          Legislatwre shall have no power to authorize any
                                          county, c Lty, town or other political corporation
                                          or subdivision of the State to lend its credit or




                                                          p. 2366
Honorable Carlos Valdez.- Page 2   (JM-516)




          to grant public money or thing of value in aid of,
          or to any individual, association or corporation
          whatsoever, or to become a stockholder in such
          corporation, association or company.

     That provision does not prevent counties from contracting with
private corporations. Attorney General Opinion JM-65 (1983). Rather,
it prohibits gifts to a private corporation. As a corollary, it
requires that a county contract with a private corporation serve a
public purpose and that the county receive adequate consideration.
Attorney General Opinion NW-373 (1981). Also, such a contract must
provide sufficient assurance that the public purposes will be
accomplished. &, * Attorney General Opinion H-912 (1976).

     In Attorney General )pinion H-397 this office concluded that
paying dues to a private corporation such as a chamber of commerce in
order to secure "general benefits resulting from encouragement of
private industry and busir.ess"was not "sufficiently insulated from
the abuses" that article :LII. section 52, was designed to prevent.
Implicit in that conclusion is a determination that paying dues to a
chamber of commerce did not adequately assure that any public purpose
would be accomplished and therefore that the dues would be, in
essence, a gift to the private corporation.

     A contract for sp&if:.c services presents a different situation.
For purposes of article III , section 52, the difference between paying
dues to an organization that may provide general benefits to the
.county and contracting with an organization for specific services is
analogous to the difference 'betweendonating county funds to a private
hospital and contracting with a private hospital for specific
services. In Attorney General Opinion JM-65 (1983) we held that
although a county could not donate funds to a private hospital, it
could contract with a private hospital for specific services.
Similarly, we think that a county may contract with a private corpora-
tion for business and industrial development services. Of course, the
county must receive adequnte consideration, and the contract m&.t
provide adequate assurance that the public purpose will be accom-
plished. Whether a county receives adequate considiration and whether
a contrabt provides adequate assurance that its public purpose will be
accomplished are questions of fact that would depend on the nature of
any particular contract.

                             SUMMARY

             A county has rx~thorityto promote the develop-
          ment of business and industry in the county under
          article 15818-2, V.T.C.S., and article 2352d.
          V.T.C.S. A county may contract with a private
          corporation such as a chamber of commerce for the




                              p. 2367
Honorable Carlos Valdes - Pa:Se3   (JM-516)




          provision of busLness and industrial development
          services if the county receives adequate con-
          sideration and if the contract provides,adequate
          assurance that the public purpose will be
          accomplished.




                                        JIM     MATTOX
                                        Attorney General of Texas

JACK HIGHTOWER
First Assistant Attorney General

MARY KELLER
Executive Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Sarah Woelk
Assistant Attorney General




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