                 THE     ATTOIWEYGENEEZAL
                              QF   TEXAS

                         AUSTIN.   TEXAS   7SW11
DHAWP‘OHU c:. MAxrrlN


                         February 28,   1967

      Mr. Hugh C. Yantls                    Opinion No. ~-32
      Executive Secretary
      Te;zzrater Pollution Control          Re:    Constructionof Senate
                                                   Bill 204 and House Bill
      1100 West 49th Street                        448 of the 60th Legls-
      Austin, Texas 78756                          lature, Identical bills
                                                   which would establish
                                                   a Texas Water Quality
                                                   Board as the successor
                                                   to the Texas Water
      Dear Mr. Yantis:                             Pollutlon Control Board.
                In view of the provisions of Section 51 of Article III
      of the Constitutionof Texas prohibitinggrants of public monies
      to any individual,association of Individuals,municipal or other
      corporations,you have asked the following questions relatln to
                                                       448 of the t0th
      the provisions of Senate Bill 204 and House Bl.1~1
      Legislature (identicalbills establlshlngthe Texas Water Quality
      Board) prescribing its powers, duties, functions and procedures
      and providing for the establishmentof quality waters in the State
      and the control, prevention and abatement of pollution:
                "(1) May a grant of State funds be made
           to a governmentalentity for constructionof
           waste collection,treatment and disposal facllltles
           for water quality control purposes, as provided In
           the proposed Texas Water Quality Act?
                "(2) May a grant of State funds be made to
           a governmentalentity for the purpose of planning
           water quality control programs and facilities,as
           provided In the proposed Act?
                "(3) May a loan of State funds be made to a
           governmentalentity for the purposes of planning
           water quality control program! and facllltles,as
           provided In the proposed Act?
                Under the provisions of Section 11 of the proposed Act,
      the Board is authorized to make grants to any munlcipallty or
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m. Hugh c. Yantls, page 2 (M-32)


Interstate agency 'as such terms,are defined In the Federal Water
Pollution Ccntrol Act (33 USC 466, et seq.) or to any local govern-
ment for the constructionof necessary treatment works and necessary
sewer and sewerage systems, treatment systems and disposal systems.
The Board is further authorized to make grants or Interest-free
loans to certain planning agencies (governmentalagencies) for
developing an effective comprehensivewater quality control abate-
ment plan. Thus, such grants or Interest-freeloans of State
funds to planning agencies are made for governmentalpurposes
and are not made for any private purpose.
          Section 51 of Article III of the Constitutionof Texas
provides in part:
         "The Legislature shall have no power to
    make any grant or authorize the making of any
    grant of public moneys to any Individual,associa-
    tion of individuals,municipal or other corporations
    whatsoever; . . .'I
In construing the above quoted provisions it was held In State
V. city of Austin, 160 Tex. 348, 331 S.W.2d 737, 742 (1960):

          'Here the Legislaturehas empowered the
     State Highway Commission to construct Interstate
     and defense highways and to direct munlclpalltles
     and utility companies to relocate their facilities.
     That grant of authority is conditioned,however,
     by the requirement that the utilities be reimbursed
     for the expense which they incur. In our opinion
     this does not constitute the release of an .obliga-
     tion to the state within the meaning of Article III,
     Section 55, of the Constitution. See State ex rel.
     Jones v. Chariton Drainage District No. 1, 252 MO.
     345, 158 S.W. 633.
          "Article6674w-4 obviously does not involve a
     gift or loan of the credit of the state unless It
     can be said that payment of relocation costs amounts
     to a grant 07 public money in violation of Article
        , Section 51. The purpose of this section and
     of Article XVI Section 6, of the Constitution1s
     to prevent the'appllcatlon.of public funds to private
     purposes; in other words,,to prevent the gratuitous
     grant of such funds to any individual or corporation
     whatsoever.
          --      See Byrd.v. city of Dallas, 118 Tex. 28,
     6W.2d    738. Statutes analogous to House Bill 179
     have been upheld against this or similar constitutional
                        - 139 -
    Mr. Hugh C. Yantls, page 3 (M-32)


         attacks by the appellate.courts,,of
                                          at least
         five other jurisdictions.. . .
              Thus, a grant of State funds to a political subdlvlslon
    of the State for governmentaluse of such money is not prohibited
    by the provisions of Section 51 of Article III of the C&-&ltutlon
    of Texas'nor any other provision of our'state Constltutlon. Bexar
    County v. Linden, 110 Tex. 339, 220 S.W. 761 1920); Road.Dlsm
     0.    Shelby County V. Allred, 123 Tex. 77, a s.w.2a lb4 (1934);.
    Jeffeison County v. Board of County and District Road Indebtedness,
    143 T    99 182 S W 2d 908 l79-44) city of Aransas Pass v. Keeling,
    112 T:;: 334, 247 i.;. 818 (1923).;
.
             In Bexar County v. Linden, supra, the Court stated In
    construing Section 31 of Article m  of the Constitutionof Texas:
             "The giving away of public money, its ap-
        plication to other than strictly governmental
        purposes, is wfiatthe provision Is intended to
        guard against.
              In Road District No. 4, Shelby County v. Allred, supra,
    the Court at page lb9 held In construing Section 51 of Article III
    of the Constitutionof Texas:
             “It Is the settled law of this state that
        the above-quotedconstitutionalprovision is ln-
        tended to guard against and prohibit the granting
        or giving away of public money except for strictly
        governmental purposes. The prohibition Is an ab-
        solute one, except as to the class exempted there-
        from, and operates to prohibit the Legislature from
        making gratuitous donations to all kinds of corpora-
        tions, private or public, municipal or’polltlcal.
        Bexar County v. Linden, 110 Tex. 339, 220 S.W. 761.
        It is clear from the above that a road ‘districtis
        a corporationwithin the meaning of the above-quoted
        constitutionalprovision.
             “It Is also the settled law of this state that
        the above-quoted constitutionalprovision does not
        prevent the appropriationor granting of state funds
        to municipal and political corporationswhen the
        money Is granted to be used for a governmentalpurpose.
        Bexar County v. Linden, 110 Tex. 339, 220 S;W. 761;
        City of Aransas Pass v. Keeling, Attorney General,
        112 Tex. 339, 247 S.W. ala, 819.
              "It cannot be doubted that the effect of sec-
         tion 12 of the special law under considerationhere
                            - 140 -
-




    Mr. Hugh C. Yantis, page 4 (M-32)


        has effect to make a donation of state funds to
        the road district. If this donation is a mere
        gratuity, It Is prohibited by section 51 of
        article 3, supra. On the other hand, If the
        donation Is made and granted to the road district
        for a governmentalpurpose, it is not a gratuity
        and not prohibited by such constitutionalprovision.
        Bexar County v. Linden, supra; City of Ara$sas Pass
        v, Keeling, Attorney General, supra. . . .
              In view of the foregoing,you are advised that the
    Legislature may authorize the grant or the loan of State funds
    to be made to a governmentalentity for constructionof waste
    collection, treatment and disposal facilities for water qualIt>
    control purposes, and planning water quality control programs
    and facilitiesas provided in Senate Bill 204 and House Bill 448
    of the 60th Legislature.
                        SUMMARY
             The Legislaturemay authorize the grant or
        the loan of State funds to be made to a govern-
        mental entity for constructionof waste collection,
        treatment and disposal facilities for water quality
        control purposes, and planning water quality control
        programs and facilitiesas provided In Senate Bill
        204 and House Bill 448 of>he 60th Legislature.




    Prepared by John Reeves
    Assistant Attorney General
    APPROVED:
    OPINION COMMITTEE
    Hawthorne Phillips, Chairman
    W. V. Geppert, Co-Chairman
    Kerns Taylor
    Pat Bailey
    Roger Tyler
    Malcolm Quick
    STAFF LEGAL ASSISTANT
    A. J. Carubbl, Jr.
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