                 September 30,   1965


HonorableRalph Prince            Opinion No. C-517
County Attorney
Box 2403                         Re:    Whether the Commissioners
Longvlew,Texas                          Court may, acting under the
                                        provisions of Article 4494(L),
                                        V.C.S., lease the county
                                        hospital for a 99 year term
                                        with the express agreement
                                        that the lessee may encumber
                                        the land, existing buildings
                                        and equipment for substantial
                                        improvementsthereto, lnclud-
                                        ing the constructionof new
                                        buildings and the purchase of
Rear Sir:                               new equipment.
         You have requested an opinion ofthls office on the
followingquestion:
           "May the CommissionersCourt acting under
      the provisions of Article 4494 (L) R.C.S. lease
      the county hospital for a 99 year term ,withthe
      express agreement that the lessee may encumber
      the land, existing buildings, and equipment for.
      substantialImprovementsthereto, including the
      constructionof new buildings and the purchase
      of new equipment?'
          In 1959,.you requested an opinion of this office
(~~-630) as to whether the CommissionersCourt of Gregg County
bad the authority under Article 4494 (L), Verhon's Civil Statutes,
to lease the county hospital. While 'answeringyour request
in the affirmative,our office pointed outthat in,the proposed
lease contract:
          II   .the county does not lend Its credit
     or be&ml a stockholderIn or subscrlber~to the
     capital~ofthe lessee and,does not enter upon a
     joint venture with said lessee since control over
     the management and operation of the hospit.alis
     ceded to .the~lessee,all debts of the hospital.


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    Hoi. Ralph Prince, page 2 (C-517)


         are avoided by the county, and it Is held safe
         for atiyliability which might arise from the
         operation of the hospital. . . .'I
              The Proposed lease'.lnthe present Instance would allo
.   the lessee to encumber the county's property and in case of
    default of the lessee leave the county liable to the lien holde
    Therefore, the lease In effect pledges the credit of the county
    .thiscontravenes Article III, Sections 50 and 52 'ofthe Consti-
    tution of the State of Texas.
              Further, as also noted in Opinion   w-630:
               II
                   .No appropriationof ,public.fundsto
                    .   .

         charitable or non-charitableorganizationsmanaged
         and operated or controlledby private individuals
         can be made by a Commlsslone'rst
                                        Court. Tex.Const.
         Art. III Sec. 50, Sec. 51 and Sec. 52; TexiConst.
         Art. VIIf Sec. 3;,and Tex.Const. Art. XVI ~Sec.
         6. Upon the lease of the hospital it will: of
         course, cease to be a legitimate reckpient of
         county funds."
              The Commissioners Court is a court of limited jurls-
    diction and has only such powers as.are o,onferred  upon it by
    statutes and the Constitutionpy express terms 07 b necessary
    implication. Childress County v. State 127 Tex. 3313, 92 S.W.2
    1011 (1936); Von Rosenberg v. Lovett    1 3 S.W. 508 (Tex.Civ.App
    1915 error ,ref.);Roper v. ~11;2&       S!W. 289 (Tex.Civ.App.
    1925). However; the Commlss oners' Court has no statutory
    authority to encumber the property-through liens. Under the
    proposed lease, the Commissioners1Court would allow the lessee
    to encumber the land, existing buildlng~, and equipment of the
    hospital. In Opinion No: O-47, this department held that:
              1,   .The Cixnmlssloners'  Court, having np
         power &iept that specially conferred by the'
         Cdnstitutlonand statutes pass.edpursuant
         thereto wou1.dhave no power to enter into any
         contract for the building and maintenance of a
         hospital, the title td which would.be held in
         any main&r contrary to the principal provisions
         of Article 4478.11                               .
              Article 4478 provides:
                   .At Intervals of not less than.twelve
         ~months';
                 <en per cent of the qtialified.prbperty


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                            ,.'
Hon. Ralph Prince, Page 3 (C-517)


     tax paying voters of a county may petition such
     court to provide for the establishing or enlarging
     of a county hospital,in which event said court
     within the time designated in such petitldn shall
     submit to such voters at a special or regular
     election the propositionof issuing bonds in such
     aggregate amount as may be designated in said
     petition for the establishingor enlarging of
     such hospital. . .-.'I
          In Opinion No. O-6433,    this department held:
          "The legislaturehas authorized counties to
     create 'debts'within the meaning of the constltu-
     tlon by authorizingthe Issuance of bonds and
     time warrants, and we are unable to -any     legal
     means by which a commissioners'court may obligate
     the tax revenues of the county for a future year
     other than by complying with the statutory pro-
     vlsions as to the issuance of bonds and/or time
     warrants."
And further:
          "It ls.our opinion that the contract of sale
     fok'the hospital,equipmentis not in conformity
     with the statutory provisions pertaining to the
     creation of a debt against the cou.nty. We know
     of no constitutionalor statutory provision
     authorizingthe creation of an obligation against
     the county out of the revenues of future years by
     means of vendor'slien notes, bearing a stipulated
     rate of interest."
          Since, in this instance, the Commissioners'Court
may not bind the county other than by duly voted bonds and/or
time warrants and may not encumber county property with liens,
the ~Commissloners~Court may not by lease agree to allow the
lessee to do indirectly that which the cotirtcould not do
directly. In answer to your question it 1s the ,opinlonof this
office that since the CommissionersI Court may not encumber the,
land, existing buildings,and equipment of ~thehospital through
,liens,the county's lessee may not be granted .theright $q.so
encumber the property.




                              -2431-
Hon. Ralph Prince, page,4 (C-517)


                      SUMMARY
         The Commissioners8Court may not make an express
    agreement to lease a county hospital which lease
    would allow the lessee to encumber the land, existing
    buildings, and equipment for substantial improvements
    thereto, including the construction of new buildings
    and the purchase of new equipment. Such a condltl,on
    would be unconstitutionalunder Article III, Sections
    53 and 52, Texas Constitution,and in contravention
    of Article 4478.  Further, the Commissioners'Court
    is given no authority to create debts for the
    establishingor enlarging of a hospital In any
    manner other than by time warrants and/or bonds which
    have been duly voted upon by the property holders
    of the county, and, therefore, the Commissioners1
    Court may not allow the lessee to encumber the
    property through liens.
                             Very truly yours,
                             WAGGONER CARR
                             Attorney General

                                      -JL-
                                  j
                             BY
                                    Wade Anderson
                                    Assistant
WA:ml
APPROVED:
OPINION COMMITTEE
W. V. Geppert, Chairman
Pat Bailey
Al10 Crow
Paul Phy
Vlnce Taylor
APPROVED FOR TRE ATTORNEY GENERAL
BY: T; B,.Wright




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