                       The Attorney                General of Texas
                                           March        11,1981
MARK WHITE
Attorney General

                   Honorable Oscar II. Mauxy, Chairman            Opinion No.   MW-302
                   Senate Education Committee
                   Texas Senate, State Capitol                    Re:   Issue of new tuition revenue
                   Austin, Texas 78711                            bonds   under chapter 55 of the
                                                                  Education Code

                   Dear Senator Mauxy:

                          You have asked whether universities        authorized to issue tuition
                   revenue bonds up to certain maximum amounts under the provisions of
                   sections 55.17, 55.171 and 55.172 of the Education Code can issue new bonds
                   as they retire the original debt, so long as the statutory maximum amount is
                   not exceeded.

                          Section 55.17(e)(2) authorizes the board of regents of Texas Tech
                   University to issue tuition revenue bonds in an amount “not to exceed $35
                   million” for the purpose of providing facilities for the School of Medicine at
                   Lubbock. The University of Texas System, the Texas A & M System, the
                   University of Houston and Pan Ameri n University may issue bonds in
                   amounts limited in similar language.             Educ. Code SSSS.l?(f), 55.171,
                   55.172.

                          The discretion inherent in the phrase “not to exceed” is a recognition
                   that a lesser amount may suffice but in no event can a greater amount than
                   the stated amount be used. Train v. City of New York, 420 U.S. 35 (1975);
                   Zurich General Accident & Liability Insurance Co. v. Thomas, 187 S.W. 2d
                   689 (Tex. Civ. ADD.- 1945. no writ). As we understand vour ouerv. the
                   unive.rsities wish io continue to issue new debt up to the r&pe&ve &llng
                   amounts as old debt is retired.

                           A perusal of certain constitutional provisions containing authorization
                    for bonded Indebtedness in identical language is instructive.       Article III,
                    section 49-b of the Texas Constitution authorizes bonds to purchase land for
                    resale to Texas veterans.       When an increase ln the dollar amount was
                    needed, the provision was amended to provide for higher dollar amounts.
                    The Veterans’ Land Board did not issue new bonds as old bonds were retired.
                   ‘Similarly, article III, section 49-d-l increased the dollar amount authorized
                    for the Texas Water Development Board by article III, section 49-c. Article
                    III, section Sob-1 increased the dollar amount authorized for bond-financed
                    student loans by article III, section 50b. In each case, the authorizing




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language is identical to that contained in sections 55.17, 55.171 and 55.172 of the
Education Code.      In each case, a constitutional amendment was required when
additional funds were needed.

       Legislative history also supports our view that the universities may not issue new
debt up to the ceiling amounts as old debt is retired. The original version of section
55.17 had no dollar ceilingsl the final version did.~ While records of floor debate were
not kept for the 62nd Legislature, which passed section 55.17, there are records of
floor debate for the 63rd Legislature, which passed sections 55.171 and 55.172. These
records indicate that the amounts authorized were an aggregate amount and that
additional amounts would call for new legislation.

       It is our opinion that additional legislation is required before the universities may
issue further tuition, revenue bonds once the schools have reached their present
statutory limits, and that there is no authority for issuing new bonds as outstanding
debt is retired under the existing provisions.

                                      SUMMARY

                Universities authorized to issue tuition revenue bonds under
            sections 55.17, 55.171 and 55.172 may not issue additional bonds
            as outstanding bonds are retired.




JOHN W. FAINTER, JR.
First Assistant Attorney General

RICHARD E. GRAY III
Executive Assistant Attorney General

Prepared by Susan’Lee Voss
Assistant Attorney General

APPROVED:
OPINION COMMITTEE

Susan L. Garrison, Chairman
Jon Bible
Rick Gilpln
Robert T. Lewis
Ladd Pattillo
Susan Lee Voss
Bruce Youngblood




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