             "I'~XEATTOWNEY             GENERAL
                          OFTEXAS

PRICE DANIEL
ATTORNEY
       OENERAL
                            Augart18, 1950.

    Bon. A. 0.  Huellrs             oQanion Ho. v-loag.
    Oounty Attorney
    $"6:  c;w&                      Rer The author%tJ of the
         9                              coplrpisetonerr ’ oourt
                                        to cash Ooverrrasnt
                                        bond whoa1 fund In-
                                        oestaents befor. sa-
                                        turlty an6 Ire&avert
                                        &ggpg;           &$g
                                        a lower Interest   rate.
                                                                 --   ..




Hoa. A. 0. llu8ller,     PIge 2    (v-lm9)


     settlera.    Said lands, ana the p00esas
     theroof,   vhea 80la, shall. b8 held by eaid
     oouaties alonr 88 a trwt for tha braat
     of public   sahoolr th8reia;  sala proowdl   to
     be lntwtrd    la bonds of thb Uaitad 8trt.r;
     the Stats of Zuu8, or oouaticu in 88id
     State, or la such othrs 88cur;tiea,and un-
     der suoh restrlotione a8 my be p88awlb~d
          lawj and the oouatles        oh11 be rerpoari-
     7 e for all iavrstmeatb;
     b                                 the iatemrt  Wwo-
     o~~~$uldo~m~e~mnn~            gxoopt the pirroipal
                                  0
            Artiole    2624, V.O.S.,    pmvlbers
             %8ch oounty may 8811 or alepose of the
     land8 gmnted to It for eduoatlon81 porpo808
     la such a8nner a8 may be p8ovlQod by the oomt-
     mlrsioners court of such aowty,        and th8 pro-
     oordr OS any ruoh sale 8h8U be invortad in
     babde of the United States       UI Sbrtie of Vu-
     a8, the beads 0r the oouldes        0r th8 statr,
     rDdth8 laQ.p8naent or oomon8ohoolal8-
     tplete,     road preoinot,  dmimge,    irrigrtion,
     n8vi ation and lrvso dirtrIot lo tU Ilkto,
     and &he bond8 of Incorporate& citira an6
     towne, and held by suoh oounty alone a8 a
     trust    for the benefit   of ublla free school8
     therein,     only the interee e thereon to be
     used and expended 8rW811y.Y
           By virtue  OS the foregoing   constitutional  and
statutmt   provirionr   latorort  p8id oa lavestments of
moneys belonging to ihe per*anent school fund of a ooun-
ty ia doposltrd In the available eohool fund OP the coun-
ty rather than the prrm8n8nt 8ohool fund.       Furthermom,
roneye belonging to the paruarat      rahool fund oanaot be
upeaaod or used by the aountyo
          Under the fads   submittrd,  the Ccmlaeloners~
Cowt would roll   Unit84 Stat08 Oovrraaeat  bonds belong-
iag to the permanent school fund of the oountp at a die-
count, thereby diminishing the permanent achool fund. It
L8 our      on that 8wh a proo@durs would br io vlol~-
tioa 0r  lot1on 6 or Artio1, VII of the Con8tittltion or
       spL"I
Tax08 *

            If,   on tar other hand, thr gov8mamrat      bonds IA
quor~lm    era sold    at not   1888 than par,.ths   Coam%881oa8xw~
lion. A. 0. Mueller,   Page 3   (V-1089)



Court would have authority under Article  2824 to invest
the prooeede in bonds OS Independent eohool dlstrlcte.
           Slnoe Section 6 of Article VII of the Constitu-
tlon of Texas makes the Comlasloners ( Oourts trustees     of
a permanent school fund of a county for the benefit   of
public  8ohoo18, It was held in            Y v. Blackburq,
100 Tex. 51, 93 Sew. 419 (1906                 I i       I
Court could not reduce the lnt                  x?f~L
ISeVOn per oellt to thr80 per curt.
            In view of the foregoing,      it ie our opinion
that lt Is within the dlaoretlon        of the Comi,esionersl
Oourt to aetsmninb     In vhat securlt;ies    it ~111 Invest
aoaeys be1      ing to the permanent sohool fund of the
county.   If“e; he facts should show, however, (tonslder-
lng the interest    rate and maturity date of the bonds)
that the Commlaeioners I Court abused its discretion          In
Investing the moneya belong         to the permwmnt echo01
fund of the county and did no   “& &llVBSttlrfs ~Monegfor the
benefit  of the permanent school fund of the county and
the county available     school fund, it 18 our opinion that
the CQllPaisslonerst Court ‘8 order would not be valid.
            You also ask if the Commissioners t Court would
have the authority   to sell United States Government bond8
at a discount and purohase the Llano Independent School
DietriOtS’ bond8 if the Llano Independent School Dietriot
would gay the amount of the dlaaount neoessary to obtain
the nomy on the government bonds.       In answer to this
qu8stion,   we 0811 your attention  to the provirrions of
Artiak    2786 whloh would prohibit  the Ll.ano Independent
8choel Metriot from pagan& the dltaaount, einoe Artlols
2786 pm&ibltr    the who01 dietrlat    f~oi selling  its bond8
at 1088 thaa par.


          The Cimmirebone;re t Court aannot eel1
     Uaftod  States Oovsment bonds beloqjkng
     to ma   prmenent  rohool runa of the oouat
     at a diraouat.   T*x.benst., Art.VII, Sea.z .
           It 18 within tke d&6@‘etlon of the Oom*
     8i88i      8’ Oort to deoi40 in what aee l-
     ti88 9”  T hstred
             au         by Arti,sle  28~4, V.C.S. 7 it
     ma’$v~oaeym         bsWn&l~ ta the permanent
                   e The U~8e~oll*lra’    00~4 hold8
                                                                    c      .




Hon. A. Q. Mueller,         page 4   (V-1089)


        moneys belonging to the permanent who01
        fund in trust for public schools,  and can-
        not abuse this diBcretion.   Delta Coun
        m           100 Tex. 51, 93 S.W. 419 (1

APPROVED1                                   Yours very truly,
J. C. Davie,        Jr.                        PRICE DANIEL
County Affairs        Division              Attorney General

Sverstt Hutchlason
Executive Assistant                                        a>,   , /-?Z?
Char108 D. Mathews                               John Reevee
FirBt   ABslst~at                                  Assistant

JR%mw




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