Honorable Walter L. Bell             Opinion No. s-187
Executive Director
State Board of Control               Re: Contract for Interchange
Austin, Texas                            of products between in-
                                         stitutions operated by
                                         the Board for Texas
                                         State Hospitals and
Dear Mr. Bell:                           Special Schools.
        You have requested an opinion on the following ques-
tion:
               "Are contracts drawn pursuant to the
        provision of the Interagency Cooperation Act,
        Article b&13(32) Vernon's Civil Statutes, the
        correct procedure for transferring livestock,
        farm and garden products, milk, creamery pro-
        ducts, beef, pork, and ice between the several
        agencies under the control of the Board of
        Texas State Hospitals and Special Schools?"
       All the materials, supplies and services mentioned
in the foregoing question are used by the various lnstitu-
tions under the control of the Board for Texas State Hos-
pitals and Special Schools.
       The purpose of the Interagency contracts referred
to in your request is stated in a letter to you by Mr. 0. G.
Hereford, Supervisor of Central Supply Services for the
Board for Texas State Hospitals and Special Schools, as
follows:
               "The Austin State Hospital maintains
  :     Ice making facilities and sells ice to lnsti-
        tutlons In the Austin area since the other
        Institutions do not maintain such facilities.
               "Also, the Austin State Hospital,
        Austin State School, State School Farm Colony,
        and the Texas Blind, Deaf and Orphan School
Hon. Walter L. Bell - page 2.                  (Opinion No. S-187)


        operate gardens and farms, and any surplus
        items produced are interchanged between these
        institutions.
                 "In the same line you will note
        that there are contracts for dairy and milk
        products since the Austin State Hospital
        operates a Ceqtral Creamery for the making
        of cooking milk and buttermilk that is sold
        to the other Austin institutions. In the
        past this operation was handled through
        the Central Warehouse System; but since the
        dissolution of the Central Warehouse, these
        contracts between the institutions are neces-
        sary.
                 "We should like to point out also
        that some institutions operate dairy and
        hog farms with all surplus dairy cattle and
        hogs interchanged, through the Inter-Agency
        Cooperation Contracts, with other lnstltu-
        tions."
        Section 3 of Article 4413(32), Vernon's Civil Stat-
utes, provides in part as follows:
                 "Any State agency may enter into
        and perform a written agreement or contract
        with other agencies of the State for fur-
        nishing necessary and authorized special or
        technical services, including the services of
        employees, the services of materials, or the
        services of equipment. . . .'
        In construing the provisions of Article 4413(32 ,
it was stated in Attorney General's Opinion S-138 (1954I :
                 "It should be noted that the three
        types of authorized services -::servicesof
        employees, services of materials, and ser-
        vices of equipment - are listed disjunctively.
        Thus, a contract may be for each type separate-
        ly or for any combination of the three. Looking
        to the complete language of the statute, we
        think the term 'furnishing services' is used
Honorable Walter L. Bell - page 3.      (Opinion No. s-187)


        in the broad sense of making the particu-
        lar commodity (labor, materials or equip-
        ment) available for the benefit or use of
        the receiving agency instead of in the
        narrow sense of performance of labor or
        useful work. It is our opinion that
        either materials or equipment may be fur-
        nished without any further attendant
        'services'."
        In that opinion, a copy of which is enclosed,
this office held that Interagency contracts between two
branches of A. & M. College, whereby the Experiment Sta-
tion would furnish milk produced in its dairy husbandry
department to the College creamery, and the contract where-
by the Agricultural Experiment Station sold seed rice,
which had been produced on its substation farms, to the
Texas Prison System for crop planting on one of the Prison
System's farms, were authorized by the provisions of
Article 4413(32). By like reasoning, it is our opinion
that various products in the custody of one institution
under the control of the Board for Texas State Hospitals
and Special Schools may be transferred to other institu-
tions by interagency contracts entered into pursuant to
the provisions of Article 4413(32). The only limitation
on the volume of these agreements is contained in Section
5 of Article Q&13(32), which provides that such contracts
cannot exceed the limitations of the institution's ap-
propriated funds.
        It was not the intention of the Legislature by
the enactment of this Statute to permit State Agencies to
engage in private enterprise or to compete with farmers,
ranchers, dairymen or other private business. However,
under existing laws some interagency agreements have this
effect, and additional legislation will be necessary if
these practices are to be prohibited.
Honorable Walter L. Bell - page 4.            (Opinion No. s-187)




                            SUMMARY

                 Livestock, farm and garden products,
        milk, creamery products, beef, pork and ice
        may be transferred between the several a-
        gencies under the control of the Board for
        Texas State Hospitals and Special Schools
        by interagency contracts drawn pursuant to
        the provisions of Article 4413(32).

                                 Yours very truly,
APPROVED:                            JOHN BEN SHEPPERD
                                     Attorney General
J. C. Davis, Jr.
County Affairs Division
                                 BY     .,J
                                         John Reeves
Mary X. Wall                                Assistant
Reviewer

J. A. Amis, Jr.
Reviewer

L. W. Gray
Special Reviewer

Davis Grant
First Assistant

John Ben Shepperd
Attorney General
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