       THEATTORNEY                    GENERAL
                    OF   =XAS




Honorable Ray A. Fowler             Opinion No. C-733
Assistant   Commissioner
Coordinating Board
Texas College and University    System
Austin, Texas
                                    Re:   Whether money in the
                                          Texas Opportunity Plan
                                          Fund in excess of the
                                          amount immediately
                                          necessary for student
                                          loans may be invested
                                          in obligations  of
                                          agencies of the United
                                          States which are not
                                          unconditionally  guar-
                                          anteed by the United
                                          States.
Dear Mr. Fowler:
       YOU have requested    our opinion concerning whether
money in the Texas Opportunity
                        _            Plan Fund In excess of
the amount lmmedlately necessary for student loans may
be Invested in obligations      of agencies   of the United
States which are not unconditionally        guaranteed by the
United States.      You point out that not all direct obli-
gations of agencies of the United States are uncondition-
ally guaranteed by the United States, and that a differ-
ence In the amount of the return on the investment is
effected   thereby.
       Investment of the funds In the Texas Opportunity
Plan Fund in excess of the amount Immediately needed for
student loans is governed by Section 9 of Article    II of
Article   2654g, Vernon's Civil Statutes, which provides:
           "All moneys standing to the credit of the
     Reserve portion of the Interest  and Sinking
     Fund and any moneys in the Texas Opportunity
     Plan Fund in excess of the amount necessary



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Honorable   Ray A. Fowler,    page 2 (C-738)


     for student loWis may be invested by the Board
     in direct obligations   of the United States or Its
     agencies or in other obligations   unconditionally
     guaranteed by the United States.    . . , except
     provided,  however, that money in the Interest
     and Sinking Fund, except for that which Is In
     the Reserve vortlon of such fund, may be in-
     vested only in direct obligations    of-or uncon-
     ditionally  guaranteed by the United States which
     are scheduled to mature prior to the date money
     must be avallable   for use for its intended pur-
     pose. . . “(Emphasis added).
       This provision  makes two separate authorizations.
It clearly   provides that money in the Interest       and Slnk-
lng Fund, except for the Reserve portion thereof,          can be
Invested only in direct obligations        of the United States
or those unconditionally      guaranteed by the United States.
However, investment of moneys in the Reserve portion of
the Interest    and Sinking Fund and “excess moneys” In the
Texas Opportunity Plan Fund Is not subject to the same
restriction.     An additional     type of Investment is author-
ized for these funds, viz. direct obligations         of agencies
of the United States not unconditionally         guaranteed by
the United States.     This Is evident from the difference
In the language itself     and is clearly    implied by the fact
that had the legislature       Intended no difference    in the
permissible    scope of the investment of these funds then
there would have been no reason to make separate pro-
visions therefor.
      Therefore,  we are of the opinion that the Coordinating
Board has the authority   to Invest moneys in the Texas
Opportunity Plan Fund, In excess of the amount necessary
for student loans In (1) direct obligations      of the United
States,  (2) direct obligations   of agencies of the United
States, or (3) in obligations   which are unconditionally
guaranteed by the United States.     The decision   as to the
type of investment, of course, lies within the sound dis-
cretion of the Coordinating Board.




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.    l




    Honorable   Ray Fowler,   page 3,    (C-738)


                               SUMMARY

                Moneys of the Texas Opportunity Plan
         Fund which are not Immediately needed for
         student loans may be invested In direct ob-
         ligations   of agcncles of the United States
         which are not unconditionally   guaranteed
         by the United States.
                                   Yours very truly,
                                   WAQQONER CARR
                                   Attorney General of Texas




    JWF:vg
    APPROVED:
    OPINIOK.COMMITTEE
    W. 0. Shultz,   Chairman
    John Reeves
    Pat Bailey
    Roy Johnson
    Paul Phy
    APPROVEDFOR THE ATTORNEY
                           GENERAL
    By: T. B. Wright




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