November 30, 1990
Mr. Dennis R. Jones Opinion No. JM-1252
Commissioner
Texas Department of Mental Re: Whether section 2.13
Health and Mental Retardation of the Mental Health and
P. 0.. BOX 12668 Mental Retardation Act
Austin, Texas 78711-2668 authorizes the Department
of Mental Health and
Mental Retardation to pur-
chase and/or lease real
and personal property for
the purpose of providing
community-based services
without following the pro-
cedures of the State Pur-
chasing and General
Services Act (RQ-2049)
Dear Commissioner Jones:
You ask whether section 2.13 of the Texas Mental Health
and Mental Retardation Act authorizes the Texas Department
of Mental Health and Mental Retardation [the l'departmentl'],
to purchase or lease personal property, or to lease real
property, in connection with the provision of communi-
ty-based mental health and mental retardation services under
that act, without being subject to the provisions of the
State Purchasing and General Services Act, V.T.C.S. article
601b. See V.T.C.S. art. 5547-201 et sea. (the Texas Mental
Health and Mental Retardation Act).
Article 601b provides that the State Purchasing and
General Services Commission [the 18commission**] "shall
purchase, lease, rent, or otherwise acquire all supplies,
materials, services, and equipment for all state agencies."1
1. Section 3.01(a)(4) makes exception for "materials,
supplies, or equipment purchased by a state-owned hospital
(Footnote Continued)
P. 6671
Dennis R. Jones - Page 2 (JM-1252)
Id. S 3.01(a). Article 6 of that act provides that "[w]hen
a state agency needs space to carry on its functions [it]
shall submit a written request for the space to the commis-
sion." Id. 5 6.02(a). If state-owned space is not avail-
able "the commission may lease space for the agency from
another source.lV & 5 6.05(a). Under such a lease
contract "the State of Texas, acting through the commission,
is the lessee." & 0 6.05(e).2
The department is clearly a state agency within the
purview of the provisions of article 601b. Seeid.
§ l-02(2) (defining "state agency"). Attorney General
Opinion JM-978 (1988) noted that a "state agency . . . is
subject to the provisions of article 601b . . . unless
exempted by the legislature." YOU suggest that the
department has authority under the circumstances YOU
describe to purchase or lease personal property or to lease
real property without being subject to the requirements of
article 601b.
Article 5547-204 provides specifically for the depart-
ment's duties regarding "community-based services,UV the
context in which your question about the department's pur-
chasing and leasing authority has arisen. Section 4.03, in
subsection (a), lists the minimum services that must be
available in each service area and, in subsection (b),
directs the department to contract with "designated
providers" in each service area to provide the services
directly or by subcontract. "Designated providers" may be
(Footnote Continued)
or clinic" under the circumstances set out there. Section
3.06 provides that the commission may delegate to a state
agency authority to purchase supplies, materials, and
equipment in accordance with commission-prescribed proce-
dures. Section 3.07 provides for emergency purchases.
Section 3.08 provides that "state agencies are delegated the
authority to purchase supplies, materials, and equipment if
the purchase does not exceed $500" but that the commission
shall prescribe procedures for these purchases. You neither
reference any of these provisions nor supply us with facts
indicating they are relevant to the situations you are
concerned about. We will therefore not address them here.
2. See also 1 T.A.C. 55 113.1 et sea. (commission
rules regarding purchasing), 115.31 et sea. (commission
rules regarding leasing of space).
P. 6672
Dennis R. Jones - Page 3 (JM-1252)
"community centers"3 operated by certain local governmen:;
entities, other local agencies, or private providers.
5 4.03(b). "If the Department is unable to identify s
contract with a designated provider in a service area, the
Department shall provide the services required under this
article directly through a departmental facility outreach
program." &
Section 4.01A of article 5547-204 provides that the
term "mental health or mental retardation authority8' is used
in the article to refer to both a "designated provider" and
a "departmental facility outreach program." You indicate in
your request that under some contracts with designated
providers, and for some departmental outreach programs
established under article 5547-204, the department must
acquire and provide equipment, supplies, and facilities to
be used by such mental health or mental retardation
authorities in rendering the community-based services. YOU
suggest that section 2.13 of the Mental Health and Mental
Retardation Act, if read together with section 4.03C,
provides the department with authority to acquire such
property under the "competitive procurement system"
established under section 4.03c, rather than under the
requirements of article 601b. We disagree.
Section 2.13 of article 5547-202 provides:
The Department may cooperate, negotiate and
contract with local agencies, hospitals, pri-
vate organizations and foundations, community
centers, physicians and persons to plan,
develop and provide community-based mental
health and mental retardation services.
Section 4.03C of article 5547-204 reads, in pertinent
part:
(a) This section applies only to a con-
tract to provide service for persons with
mental retardation or mental illness at the
'community level, including residential
services, that:
3. m V.T.C.S. art. 5547-203 (providing for estab-
lishment and operation of "community centers").
P. 6673
1
Dennis R. Jones - Page 4 (JM-1252)
(1) is between a private provider and a
mental health or mental retardation author-
ity:
(2) involves the use of state funds or
funds for which the state has oversight
responsibility: and
(3) is initially awarded on or after
August 30, 1989.
(b) The department shall design a com-
petitive procurement or similar system that a
mental health or mental retardation authority
shall use in awarding a 'cktract under this
section.
See also 25 T.A.C. 5s 401.377 - 401.385 (the departmentts
rules promulgated pursuant to section 4.03C).
We find nothing in sections 2.13 or 4.03C which indi-
cates that the legislature intended these sections to
provide exemptions from article 601b for leases or purchases
of property by the department.
Even if the procurement system provided for in section
4.03C might arguably be made applicable to departmental
procurements where the mental health or mental retardation
authority to be contracting for services with a private
provider is a departmental facility outreach program, that
section applies only to contracts with a provider. If,
under such a contract, a departmental facility outreach
program is to provide space or property to be used in
rendering the services, the department's acquisition of such
space or property is not exempt from article 601b. See
Attorney General Opinion JM-445 (1986) (purchases by Texas
Surplus Property Agency with funds from Service Charge Trust
Fund subject to article 601b). s Attorney General Opinion
JM-978 (1988) (administration of medicaid program for
Department of Human Services). CornDare Attorney General
Opinion H-459 (1974) (the predecessor to article 601b did
not apply to a short-term rental of space by the Texas
Rehabilitation Commission for a client of the commission).
P. 6674
Dennis R. Jones - Page 5 (JM-1252)
SUMMARY
Where the Department of Mental Health and
Mental Retardation purchases or leases
personal property, or leases real property,
to be used in connection with the provision
of community-based services by a mental
health or mental retardation authority under
the Mental Health and Mental Retardation Act,
section 2.13 of that act does not exempt
those acquisitions from the provisions of
article 601b, the State Purchasing and
General Services Act.
JIM MATTOX
Attorney General of Texas
MARYKKLLKR
First Assistant Attorney General
LOU MCCREARY
Executive Assistant Attorney General
JUDGE ZOLLIE STEAKLKY
Special Assistant Attorney General
RENEA HICKS
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by William Walker
Assistant Attorney General
P. 6675
Untitled Texas Attorney General Opinion
Combined Opinion