                       May 23, 1963


Mr. John S. Hovenga                     Opinion No.~C- 83
Executive Director
Board of Regents                        Re:   Whether the term "annuities"
State Teachers Colleges                       as used in Article 6228a-5,,
Box K, Capitol Stations                       Vernon's Civil Statutes,,
Austin 11, Texas                              embraces group annuities
                                              as well ,as individual an-
                                              nuity'contracts. Should
                                              the board of regents of
                                              the institutions of higher
                                              learning hold the master
                                              contract in the name of
                                              the board of regents of
                                              the respective Institutions
                                              or should contracts be ls-
                                              sued in the name of the
                                              annuitant only, even if
                                              the contract is classified
Dear Mr. Hovenga:                             as a group annuity.
          The questions submitted in your       opinion request are
as follows:
           "(1) Does the term Iannuities as used in
     the statute referred to in the caption (Article
     6228a-5,~ Vernon's Civil Statutes) embrace group
     annuities as well as 'individual annuity contracts?
          "(2) Shall the board of regents of the in-
     stitutions of higher learning hold the master
     contract in the name of the board of regents of
     the respective institutions of higher learning,
     or shall contracts be issued in the name of the
     annultant only, even if the contract is classified
     as a group annuity?"
           Article 6228a-5,   Vernon's Civil Statutes, reads as
follows:

                              -404.,-
Mr.   John S. Hovenga, page 2 (C- 83      )


             "Local Boards of Education of the Public
        Schools of this state and the Governing Boards
        of the state-supported institutions of higher
        education are hereby authorized to enter into
        agreements with their employees for the purchase
        of annuities for their employees as authorized
        in Section &03(b) of the Internal Revenue Code
        of 1954, as amended,."
          In regard to your first question, Article 6228a-5
Vernon's Civil Statutes, does not limit the term "annuitiesL
to either group or individual annuities. However, Article 6228a-5
refers to Section 403(b) of the Internal Revenue Code. In Sec-
tion &03(b) and the Internal Revenue Regulations for that Sectio'n
and related Sections, no distinction has been drawn between group
annuities and individual annuity contracts. Since the general
term "annuities" has not been limited in either of these statutes,
the Legislature must have intended the term to embrace both group
and Individual annuities. In the absence of evidence to the con-
trary, common terms used in an enactmentshould be given their
common meaning. 2 Sutherland Statutory Construction (3rd Ed.
1943)    429.
          As to your second question, Article 6228a-5 states
that 'theboard may enter into agreements with their employees
for the purchase of annuities for their employees as "authorized
in Sectionk03(bl,of the Internal Revenue Code of 1954, as amen&
ed." (Emphasis added). This evidences the intent that these il
annuities would be set up in a manner in which they would be "tax-
sheltered" annuities under the Internal Revenue Code and Reguia-
tions. The question which you have posed to us +s one of mechanic:
in the setting up of such a plan. In setting up your plan, you
should dtscuss the details with representatives of the Internal
Revenue Service and submit proposed plans to them for approval.

                        SUMMARY
             The term "annui.ties"as used in Article 6228a-5,
        Vernonls Civil Statutes, embraces group annuities as
        well as individual annuity contracts. Whether the an-
        nuity contract should be held in the name of the Board
        of Regents of the school or in the name of the individual
        employees is a matter that you should discuss with the
        representatives of the Internal Revenue Service  and sub-
        mit plans to them for approval.



                             . ..4..;1:
Mr. John S. Hovenga, Pa&   3 (C- 83   )



                               Sincerely,
                               WAGGONER CARR
                               Attorney General




                               Assistant

JGN:mkh
APPROVED:
OPINION COMMITTEE
W. V. Geppert, Chairman
James M. Strock
Wayne Rogers
Pat Bailey
Ben Harrison
APPROVED FOR THE ATTORNEY GENERAL
BY: Stanton Stone




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