Honorable Frsnk C. Clemens, C.“.airman
Houston Light .Guard Emory Eoard of Control',
Eouston, Texas                                ‘5

Eear 13. Clemens :                Opinion :%To.0-24~7
  ‘--* . _...b - -., .~   /
                                     : Texas National Guard
                              \   Re    .irciory Board -- S. 3.
                                        427, 46th Legislature
                                        -- General Decartment-
                                        al Appropriation   Bill
                                        -- hepair,   upkeep and
                                        maintenance IIouston
                                        Life Guard Armory --
                                        Kanner of Expending.

             This will acknoaledge receipt       of your letter
of ?!ay 11, 1940, written on behelf of yourself          as act-.
ing Chairman, Eouston Light Guard Armory Board of Con-
trol,   and on behalf of i.r. C. 1;. Ninon, Secretary       Texas
National Guard Armory Board,      i!rith respect   to t:?e expen-
diture of item 6 of the maintenance and miscellaneous
zppropriation     for Texas Xational Guard Armory Board
contained in the biennial     appropriation      of the 46th
Legislature,     S. B. 30. 427, in :;hicti you propound the
following    questions:
            “1 * Is the Texas Xational Guard Armory
Board authorized    to pay out of the above mentioned
approprietion    for the costs of maintenence,   repair,
insurance and operating expenses of said Armory when
purchases are contracted     for under the approval and
management OS the Armory Board of Control but not
that of the Stste Board of Control?
            “2 . If question #l is ansvcered in the nega-
tive, is it necessary that such purchases be contracted
for under the aTprova1 and management of the State Board
of Control?
              ,;3. If question’*%‘1 is ansv:ered~ in the nega-
tive, whzt duty, authority  CR’function?    if any, must
the Armory Boerd of Control e;:ercise   ?nth respect  to
such purchases?

           “4.   Kay the exgenditres  for t%e months of
September and October be paid out of the above mention-
ed appropriation   and, if so, ii&t” si;o;:ing s:hould be
made and v;hat Board’s a_n~roval is necessary before
vouchering for payment?
        Hon. Prank C. Clem ens - Page 2
.   .      ..
        probably be sufficient,    but we would like to be certain
        with reference   to your opinion as to which Roard Ml1
        have the duty of renewing or rewriting     suchinsurance
        and as to vrhat the proper procedure would be in order
        that the premium may be promptly paid.
                       I I
                   "6. ‘Yhen policies   of insurance are to. be writ-
        ten, will it be proper to write and pay premiums out of
        such appropria~tion or similar .appropriations    for a term
        that extends:
                        “(a) Beyond the State    fiscal   year
                   to which the appropriation    applies;
                         l’(b) Beyond the State biennium for
                   which the applicable   appropriation is
                   available.
                   "7. Kay the Armory 3oard pay to Houston Light
        Guard Veterans Association,   Inc.,  as rental of the Armory
        for the months of September and October out of Item #3 of
        its appropriations  from the last Legislature     (Special
        Laws, 46th Leg. p. 148) sufficient,   money to pay said ex-
        penses on condition   that said Association   will pay the ex-
        penses’ 16th the money so received?”
                     iIouse Concurrent Resolution    No. 3.0of the lt6th
        Legislature    on behalf of the State accepts certain pro-
        perty in the City of Eouston donated, with certain’reser-
        vations,    by the Houston Light Guard Veterans Association,
        Inc. for armory purposes;      the resolution   furthermore sets
        up what is knoiin as the Rouston Light Guard Armory Board
        of Control, i-;ith certain    defined powers and duties.    The
        d.nty of the Texas National Guard krmory Roard, as set
        forth in the resolution,      is “to have charge of and pro-
        vide for the maintenance, repair,       insurance and operating
        expenses of the said armory, and to keep the said property         I
        in a good and fit condition       for occupancy in use as an
        armory by the Eouston Light Guara., now designated as Com-
        pany G, 143d Infantry,      Texss Xational Guard, and its
         successor military    cor~panies.‘1
                     Item 6 of the Kaintenance and Miscellaneous
         Appropriation   for Texas Mational Guard izmory Board,
         as made by the 46th LegisLg,ture, is as follovis:
                           "6. Repsi-r, tpkeep and maintenance
                    of Armory known as Houston Light Guard
                    Armory, as contemplaged by Youse Con-
                    current Resolution    30 of the 46th Legis-
                    lature;   provided that this appropriation
                    is not transferable*f--YW :j1,140.00 for
                    the fiscal    years ending’ August 31, 1940;.
                    and Jugust 31, 1941, respectively.     _
Hon. Frank C. Clemens - Page 3:
scribing   the duties    of the Board of Control        provides:
                    “The Board of’ Control shall pur-
             chase all the supplies        used by each
             Department of the State Government,
              including    the State Prison System,
              and each eleenosynary       institution,
             Rorrral school,     Agricultural     and L:e-
              chanical Collage,      University     of Texas,
              and each and all other State Schools
              or Departments of the State Govern-
              ment heretofore      or hereafter     created.
              Such supplies     to include furniture
              and fixtures,    .technicel    instruments
           .' and books, and all other things re-
              quired by the different        departments
              or institutions,      except strictly      per-
              ishable goods.”

          The powers of the 3oard of Control as thus pre-
scribed are broad and comprehensive and confer upon the
Board the power and duty to purchase all the supplies    used
by each department of the State government, except such
supplies as are specially  excepted in subsequent Articles,
and the Te;ras National Guard Armory Doard comes within the
purview of this statute,
            F’rom a consideration   of the statute and the well-
established    policy of the State to constitute   the Zoard of
Control as its purchasing agent for institutional      and de-
partmental supplies     for the Stcte, we beg to advise:
           Ve are of the %opinion the item of insurance
does not come within the term %uppliesll   contained in
Article  634.  The precise point seems to have been de-
termined by the Supreme Court of Montana in Filler    In-
surance Agency vs. Porter,   20 Pac. (2) 643, where it
is said:
                      “This court in the case of New York
             Life Insurance Co. .v. Deer Lodge County,
             43 Kant. 243, 115 P. 911, 912, in consid-
             ering the nature of a policy of fire in-
             surance, da: .I 'The policies         are simply
             contracts      of in>er:nity against loss (by
             fire),     entered i3to between the corpora-
             tions and the assured, for a considera-
             tion paid by the la$ter.          These contracts
             are not articles       of commerce in any pro-
             per-meaning of the word.          They are not
             subjects      of trade.and,barter    offered in
             the market as something having an exist-
             ence and value independent of the parties
             to them.       They are not*commoditiee     to be
             shipped.     or fori~~arded
                              _          from one state to          _
Hon. Prank C. Clemens - Page l+

           are like other parsonal contracts   between
           parties  which are completed by their sig-
           nature and the transfer   of the considera-
           tion.'
               ’ ‘&he term ‘supplies1      has not been
           hold to include everything that is fur-
           nished to the state or a municipality.
           In the case of “!hite v. Koore, 288 Pa.
           i,c~l~, 136 A. 218, coal for the use of a
           school house was held not to be included
           vtithin the expression     ‘school   supplies. t
           Again, in the case of Xilwaukee Electric
           Railway Co. v. City of Yilwaukee, 173 YLS.
           ~329, 181 IT. I!. 298, electric     current fur-
           nished to the city was held not to be in-
           cluded within the term *supplies, 1 in the
           statute requiring     a contract    that all sup-
           plies should ‘oe*l$t*after      bids or proposals
           were received.
                  If*   * *vte held, that fire insurance
           policies      are not included within the term
           ‘supplies.      t St was, therefore,   unneces-
           sary to      procure bids or proposals   before
           entering      into the .contracts of insurance.”
           \Ie are inclined    to follow the ZIontana case.
Prom this conclusion     it follows the Texas Rational Guard
Armory Eoard? by virtue of Xouse Concurrent Resolution
No. 30 creating   it, is charged with the duty of provid-
ing the insurance,    and there being no strtute    to the
contrary,  it is charged‘with     the further duty of con-
tracting  for it.
            The Armory Board, however, would have no author-
ity to create such a charge beyond the provisions     of the
Appropriation   Act; that is to say, beyond the fiscal    year
to which the appropriation    applies, and in no event be-
yond the biennium for which the applicable    appropriation
is available.     Fort Yorth Cavalry Club v. Sheppard, 83
s. ‘.!. (2) 6668.
             As a matter of economy it rcay be unvIi.se for the
State to deny to its repi%sentstives       the power to con-
tract for insurance upon a-three or five year basis,        but
that is for the Legislature     and not the Judicial   or Ad-
ministrative    Departments of t+he State.
            Ye have several tines held that it is the policy
 of the State .to carry its own f?.re insurance.      See Opin-
 ions 110s. O-184, O-201, O-342, O-1762 and O-2130.        ‘i’his
 general policy is indicated    by a legislative.  resolution
 referred  to in t3.e opinions.   In the present case, how-
 ever. House Concurrent~Resoli1t.i nn 1Jn. ?A vnl--Q ++ +hn
Hon. fisck   C. Clemens - Page 5,
duty,of the Texas National Guard 2rmory Zoard and its
successors    "to nrovide for * * * insurence'1     upon said
property donated by the ;-Iouston Life Guard Veterans Asso-
ciation,   Inc.   The general rule of State policy,     resting
as it does in resolution     only, is not applicable    to the
present case, since I:ouse Concurrent Pesolution       X0. 30
evidences a contrary.?ule     as to this particular    property.

          TrustinS that this general reply        &ill   have enswer-
ed your questions  satisfactorily, we are
                                       Very truly    yours


                                  By   /s/ Ocie  Speer
                                           Ocie Speer
                                            Assistant
APPPOED cJlJ-EX
              14, 1940
/s/ Gerald C. Kann
ATTOl?XEY GEKQ?ALOF TEAS
OS-5R:jrb                     . ~:~PROVXDOPIXIOX CO;I.IIT?EE
                                     BY DJB, Chairman
