                                ATTORNEYGENERAL                        OF    TEXAS
                                              GREG       ABBOTT




                                                  May 19,2004



The Honorable Mike Krusee                                        Opinion No. GA-0190
Chair, Committee on Transportation
Texas House of Representatives                                   Re: Whether a county may lease airport land
Post Office Box 2910                                             without engaging in competitive bidding
Austin, Texas 78768-2910                                         (RQ-0137-GA)

Dear Representative Krusee:

        You ask whether a county may lease airport land without competitive bidding.’ Although
you asked about selling or leasing airport land, we have been informed that only leasing, not selling
airport land is at issue.’

I.      Background        Information


          The land in question is part of the Kerrville Airport, a public use airport jointly sponsored
by the City of Kerrville and Kerr County.’ The airport management plans that a hangar and other
facilities will be constructed on airport property and leased to a private operator who has agreed to
conduct an aviation business from that location. In addition, the management intends to consider
lease renewals for existing tenants. See Pearce Letter, supra note 3, at 1. The rates for lease
renewals and new land leases will be fair market value, as established by comparisons with local
property and other “like airports” for “like services.” Id.

         The Kerrville Airport has received federal funds for improvements and is subject to federal
law and Federal Aviation Administration rules and guidelines prohibiting the grant of exclusive
rights to any person providing aeronautical services to the public. See 49 U.S.C. 5 40103(e) (2000)
(a person does not have an exclusive right to use an air navigation facility on which government
money has been expended, subject to exceptions); 14 C.F.R. 5 15 1.12 l(2003) (airport sponsor must


           ‘Letter from Honorable Mike Kmee, Chair, Committee on Transportation, Texas House of Representatives,
to Honorable Greg Abbott, Texas Attorney General (Nov. l&2003) (on tile with Opinion Committee, also available
at http://www.oag.state.tx.us)   [herein&r Request Letter].

        ‘Telephone   conversation   with Dave Pearce, Manager,    Kemille   Airport (Mar. 5,2004).

          “Letter from Dave Pearce, Manager, Kerwille Airport, to Honorable Mike Krusee, Chair, Committee on
Transportation,   Texas House of Representatives    (Nov. 5, 2003) (attached to Request Letter, on tile with Opinion
Committee, also availableat http://www.oag.state.tx.us)   [hereinatkr Pearce Letter].
The Honorable Mike Krusee - Page 2                      (GA-0190)



adopt covenant implementing exclusive rights provision); see also FEDERAL AVIATION
ADMMISTRATION,      U.S. DEPT. OF TRANSP.,Order 5190.6A (Oct. 2, 1989) (Airport Compliance
Handbook)4 3-9a. (single activity not necessarily an exclusive right). We are informed that the
contract will comply with federal requirements, and we do not address this issue. See Pearce Letter,
sup-a note 3, at 1.

II.    Local Government           Code ChaDter        263


        You ask whether a county may lease airport land to one company for airport purposes without
adhering to the competitive bidding requirements in Local Government Code chapter 263. See id.
at 2. The commissioners court has only the authority to contract on behalf of the county that the
Texas Constitution and statutes confer either expressly or by necessary implication. See Jack v.
State, 694 S.W.2d 391,397 (Tex. App.-San Antonio 1985, writ refdn.r.e.) (countymaylease land
to private individual for development only pursuant to predecessor of Local Government Code
chapter 263). Prior to 1973, counties lacked general statutory authority to lease their real property,
although specific statutes authorized counties to lease county-owned land for certain purposes such
as airports and hospitals. See Tex. Att’y Gen. LO-89-029; Tex. Att’y Gen. Op. No. M-799 (1971);
see also TEX.HEALTH& SAFETYCODEANN. $263.029 (Vernon 2001); Tex. Att’y Gen. Op. Nos.
JM-335 (1985) (county authority to sell or lease county hospital), M-758 (1970) (authority to lease
airport property). A 1973 amendment to the predecessor of section 263.001 gave counties general
authority to lease their real property. See Act of June 14, 1973,63d Leg., R.S., ch. 499, § 1, 1973
Tex. Gen. Laws 1329-30 (amending former article 1577, Vernon’s Texas Civil Statutes (1925)); see
also Act of May 13, 1987, 70th Leg., R.S., ch. 149, $ 1, 1987 Tex. Gen. Laws 707, 1035-37
(codifying former article 1577 as Local Government Code sections 263.001-,006 in nonsubstantive
revision of statutes relating to local government). This authority is now found in Local Government
Code section 263.001.

        Section 263.001(a) provides that a commissioners court, “by an order entered in its minutes,
may appoint a commissioner to sell or lease real property owned by the county.” TEX.LOC.GOV’T
CODEANN. 5 263.001(a) (Vernon 1999). “The sale or lease must be made at a public auction held
in accordance with this section unless this chapter provides otherwise.” Id. Section 263.007
authorizes a county to adopt a procedure for selling or leasing county real property through sealed
bids or sealed proposals.

         Section 263.051(a) expressly relates to airport land, authorizing a commissioners court to
lease to any person “any land acquired, by a purchase or gift, by the county for an airport and . .
lease any facilities on that land, unless the lease is prohibited by the terms of the grant of the land
to the county.” See id. 9 263.05 l(a). The commissioners court shall determine the conditions ofthe
lease, see id. 5 263.05 l(b), and may lease the land for purposes other than airport purposes. See id.
§ 263.05 1(c)( 1) (proceeds from airport land leased for purposes other than airport purposes); see also
id. $263.051 (b) (commissioners court may make contracts relating to the county’s mineral interests
inthe airportland); TEX.NAT.RES.CODEANN.$5 71.006, .008 (Vemon2001) (political subdivision


       ‘Available ar http://www.faa.gov/arp/compliance/#general     (visited Mar. 10,2004).
The Honorable Mike Krusee - Page 3              (GA-0190)




must lease land for mineral development by competitive bidding or public auction). Attorney
General Letter Opinion LO-95-066 concluded that either section 263.001(a) or section 263.007
applied to leasing airport land under Local Government Code section 263.051, because nothing in
section 263.051 was “inconsistent with the auction requirements of section 263.001 or the bid-or
proposal-requirements ofsection 263.007.” See Tex. Att’y Gen. LO-95-066, at 2. Section 263.051
does not authorize a county to lease airport property by any method other than the auction and sealed
bid or sealed proposal methods provided in sections 263.001 and 263.007 respectively.

III.   Lease of Countv AirDort      Land Under     Transaortation    Code Chapter     22


         As we have already pointed out, Local Government Code section 263.001(a) provides that
“[tlhe sale or lease [of real property owned by the county] must be made at a public auction held in
accordance with this section unless this chapter provides otherwise.” TEX. Lot. GOV’T CODEANN.
5 263.001(a) (Vernon 1999). Despite the quoted language, the legislature is not required to amend
Local Government Code chapter 263 in order to allow a county to sell or lease airport property by
some means other than an auction or competitive bidding. Texas Constitution article III, section 1
vests the state’s legislative power in the Texas Legislature. See TEX. CONST. art. III, 5 1. The
legislature has power to enact any law not in conflict with the state or federal constitutions or with
federal laws. See Jordon v. Crudgington, 231 S.W.2d 641,645 (Tex. 1950), De Shazo Y. Webb, 113
S.W.2d 519,523 (Tex. 1938). It may also adopt, amend, and repeal laws subject only to limitations
imposed by the state and federal constitutions and federal statutes. See Wulkerv. Baker, 196 S.W.2d
324,328 (Tex. 1946); Tex. Att’y Gen. Op. No. GA-0046 (2003) at 4. A legislature cannot by statute
limit a future legislature’s constitutional authority to adopt, amend, and repeal laws. See Cent.
Power and Light Co. v. Pub. Util. Comm’n, 649 S.W.2d 287,289 (Tex. 1983), Watts v. Mann, 187
S.W.2d 917,924 (Tex. Civ. App.-Austin 1945, writ refd). Section 263.001(a) does not bar us Tom
looking to other statutes for county authority to lease or sell airport property.

         Transportation Code chapter 22, which authorizes local governments to establish and operate
airports and air navigation facilities, provides additional authority for counties to lease airport land.
See TEX. TRANSP.CODEANN. 55 22.020-.021,22.024 (Vernon 1999 & Supp. 2004) (authorizing
local governments to lease and otherwise contract with respect to airports and air navigation
facilities); see also id. 9 22.001(6) (Vernon 1999) (defining local government as a municipality or
a county). An “airport” is an area used for aircraft to land and take off; a related area used for an
airport building or other airport facility or right-of-way; and an airport building or facility located
on a related area. Id. 5 22.001(2). An “air navigation facility” is

                        (A) a facility, other than one owned and operated by the
                United States, used in or available or designed for use in aid of air
                navigation, including a structure, mechanism, light, beacon, marker,
                communications system, or other instrumentality;

                        (B) a device used or useful as an aid in the safe landing,
                navigation, or takeoff of aircraft or the safe and efficient operation or
                maintenance of an airport; or
The Honorable Mike Krusee - Page 4                (GA-0190)



                          (C) a combination of those facilities or devices.

Id. 5 22.001(l).

         Transportation Code chapter 22 grants cities and counties numerous express powers
necessary to establish, build, maintain, operate and regulate airports and air navigation facilities,
including authority to “enter into a contract necessary to the execution of a power granted the local
government and for apurpose provided by this chapter.” Id. 5 22.019; see also id. 5 22.011 (general
powers regarding airports and air navigation facilities). Local governments may adopt the
ordinances, resolution, rules, and orders necessary to manage and govern the airport or air navigation
facility. Id. 3 22.014(a). Transportation Code chapter 22 includes provisions on selling and leasing
an airport or air navigation facility. See id. $9 22.020,22.021(a), 22.024 (Vernon 1999 & Supp.
2004). All leasing provisions are subject to the terms of a grant, loan, or arrangement under
Transportation Code section 22.055, which requires a local government to accept and spend federal
and state money on the terms prescribed by the grantor and consistently with state law. See id.
5 22.055 (Vernon 1999).

        We first consider a county’s authority to lease airport land under section 22.024(a), a
provision construed by a prior attorney general letter opinion. See Tex. Att’y Gen. LO-95-066.
Section 22.024(a) provides that

                           [a] local government may dispose of an airport or air
                   navigation facility or other property, or a portion of or interest in
                   property, acquired under this chapter in any manner, subject to the
                   laws of this state orprovisions of the charter ofthe localgovernment
                   governing the disposition of other property of the local government.

TEX.TRANSP.CODEANN.’5 22.024(a) (Vernon Supp. 2004) (emphasis added).

         Section 22.024(a) expressly subjects dispositions of an interest in a county airport to Local
Government Code chapter 263, the state law governing dispositions of other county property. See
Tex. Att’y Gen. LO-95-066, at 2. The legislature has further revealed its intent about transactions
under section 22.024(a) by exempting certain narrowly defined transactions from its requirements.
For example, “notwithstanding Subsection (a),” a local government may dispose of airport property
to another local government or a state or federal agency “for use for aeronautical purposes . in the
manner and on the terms the governing body of the local government considers to be in the best
interest ofthe local government.” TEX. TRANSP.CODEANN. 5 22.024(b) (Vernon Supp. 2004); see
also id. 5 22.024(d) (municipal competitive bidding statutes not applicable to municipal sales, leases
and other dispositions of certain airport navigation facility real property). Section 22.024(a) does
not authorize a county to lease airport land without complying with Local Government Code section
263.001 or 263.007.

       We now consider sections 22.020 and 22.021. Section 22.020 provides that a local
government, “by contract, lease, or other arrangement, on a consideration fixed by the local
government and for a term not to exceed 40 years,” may authorize a qualified person to operate its
The Honorable Mike Krusee - Page 5              (GA-0190)



airport. Id. 5 22.020 (Vernon 1999). Section 22.021(a) authorizes a local government to enter into
a contract, lease, or other arrangement for a term not exceeding 40 years with a person

                       (1) granting the privilege of using or improving the airport or
               air navigation facility, a portion or facility of the airport or air
               navigation facility, or space in the airport or air navigation facility for
               commercial purposes;

                          (2) conferring the privilege of supplying goods, services, or
                facilities at the airport or air navigation facility; or

                       (3) making available services to be furnished by the local
                government or its agents at the airport or air navigation facility.

Id. 9 22.021(a). The local government may establish the terms of the contract, lease, or other
arrangement and fix the charges, rentals, or fees for the privileges or services. Id. 22.021(b). “The
charges, rentals, and fees must be reasonable and uniform for the same class of privilege or service
and shall be established with due regard to the property and improvements used and the expenses
of operation to the local government.” Id. Sections 22.020 and 22.021 involve more than a lease
of land, because the lease or contract must be for airport or air navigation purposes. While some
persons may merely contract for hangar space or to use the airport to conduct business, other lessees
may agree to provide facilities or services that are essential to operating an airport or air navigation
facility. SeeFlippin v. CityofBeaumont, 525 S.W.2d285 (Tex. Civ. App.-Beaumont 1975, nowrit)
(operation of airport by third party under lease), Terry County Airport Bd. v. Clark, 378 S.W.2d 932,
934 (Tex. Civ. App.-Amarillo 1964, no writ) (lease of airport space for spraying operations); Tex.
Att’y Gen. Op. No. JM-855 (1988) at 3 (county may not lease hangar space to county judge).

IV.     Conclusion


        Transportation Code chapter 22 is a special provision applicable to city and county airports
and it includes provisions on selling and leasing an airport or air navigation facility, while Local
Government Code chapter 263 establishes general mles for the lease and sale of county land. “If a
general provision conflicts with a special or local provision, the provisions shall be construed, if
possible, so that effect is given to both.” TEX. GOV’T CODEANN. 5 311.026(a) (Vernon 1998). If
the conflict cannot be reconciled, “the special or local provision prevails as an exception to the
general provision, unless the general provision is the later enactment and the manifest intent is that
the general provision prevail.” Id. 5 3 11.026(b).

        Transportation Code chapter 22 was adopted in 1995 in a nonsubstantive codification of
statutes on transportation. See Act of May 1, 1995,74th Leg., R.S., ch. 165, 5 1, 1995 Tex. Gen.
Laws 1025,1045-57. Its predecessor, article 46d, Texas Civil Statutes (1925), was adopted in 1947.
See Act ofApr. 10, 1947,5Oth Leg., R.S., ch. 114, 1947 Tex. Gen. Laws 183. Local Government
Code section 263.001 was adopted in 1987 in a nonsubstantive codification of statutes pertaining
to local government. See Act ofMay 1, 1987,7Oth Leg., R.S., ch. 149, $ 1, 1987 Tex. Gen. Laws
707,1035-36. Its predecessor, Vernon’s Texas Civil Statutes article 1577, was adopted in 1925, and
The Honorable Mike Krusee - Page 6             (GA-0190)



its earlier predecessors go back to 1846. See Act of May 11, 1846, 1st Leg., 5 9,1846 Tex. Gen.
Laws 320, 322 (county court may appoint a commissioner to sell and dispose of any county real
estate at public auction). Former article 1577 and its predecessors did not state that a sale or lease
of county property “must be made at a public auction held in accordance with this section” but it has
long been construed as the only way in which a county could dispose of real property. See Ferguson
v. Halsell, 47 Tex.~421(1877) (applying predecessor ofarticle 1577), Jackv. State, 694 S.W.2d 391,
397 (Tex. App.-San Antonio 1985, writ ref d n.r.e.) (construing article 1577, relying onFerguson).
Transportation Code chapter 22 is later in time than Local Government Code chapter 263. There is
no indication that the legislature intended Local Government Code chapter 263 to prevail over
Transportation Code chapter 22. In fact, Transportation Code section 22.024(a) suggests the
contrary, in that it incorporates the laws governing the disposition of other county property. To the
extent that chapter 22 and chapter 263 conflict, chapter 22, the more specific law with respect to
county airport land and also adopted later in time, operates as an exception to chapter 263.

         Sections 22.020 and 22.021, in contrast to section 22.024(a), do not subject county leases of
airport land to other state laws “governing the disposition of other property ofthe local government.”
TEX. TRANSP.CODEANN. 4 22.024 (Vernon Supp. 2004). Moreover, sections 22.020 and 22.021
involve more than a lease of public land. Leases,under these provisions must be for airport or air
navigation purposes, and they may include responsibility for operating an airport or for providing
services necessary to operate an airport or an air navigation facility. While auctioning a lease would
secure the highest price, it would not necessarily secure the expertise and other qualities needed to
carry out the responsibilities that accompany the lease. Reading sections 22.020 and 22.021 in their
context in Transportation Code chapter22, we conclude that the legislature intended sections 22.020
and 22.021 to authorize lease transactions according to their terms, without incorporating
requirements from Local Government Code chapter 263. A lease of county airport land under
section 22.020 or 22.021 does not have to be made at an auction, see TEX. LOC. GOV’T CODEANN.
3 263.001 (Vernon 1999), or by sealed bid or sealed proposal, see id. $ 263.007 (Vernon Supp.
2004), in counties that have adopted that procedure. Leases of airport land under Transportation
Code section 22.024(a) or Local Government Code section 263.051, however, are subject to Local
Government Code chapter 263.
The Honorable Mike Kmsee - Page 7            (GA-0190)



                                      SUMMARY

                       Government Code chapter 263 requires a county
               commissioners court to lease county land at a public auction or by a
               sealed-proposal or sealed-bid procedure. When a county leases
               county airport land under Local Government Code section 263.05 1
               or Transportation Code section 22.024(a), it must comply with Local
               Government Code chapter 263. When it leases airport land pursuant
               to Transportation Code section 22.020 or 22.021, the county is not
               required to comply with Local Government Code chapter 263.

                                             Very truly yours,



                                        4-- GR        ABBOTT
                                            Attorney General of Texas




BARRY R. MCBEE
First Assistant Attorney General

DON R. WILLETT
Deputy Attorney General for Legal Counsel

NANCY S. FULLER
Chair, Opinion Committee

Susan L. Garrison
Assistant Attorney General, Opinion Committee
