July 5, 1961
Honorable R. E. Gray Opinion No. WW-1082
County Attorney
San Saba County - Re: Use of bond proceeds.
San Saba. Texas
Dear Mr. Gray:
you request an opinion based on the following
facts:
In a 19.38 election in San Saba County the issue
was whether or not the voters favored the authorization of
a $138,000.00 bond issue under the terms of Section 52,
Article III, Constitution of Texas, and Acts 39th Legisla-
ture (1926), 1st Called Session, Ch. 16.
In all phases of the election proceedings specific
projects were named and a definite sum of the proceeds of
the proposed bond issue was allotted each. The purpose and
use of the money, dollar for dollar, was predetermined by
the Commissioners' Court in the event the voters authorized
the issuance of the bonds.
The voters sustained the proposition by the neces-
sary two-thirds (2/3) majority. The bonds were issued as
"San Saba County, Texas, Road Bonds, Series 1938," $138,-
000.00.
The one voted proposition pertinent here read:
"To assist in constructing a new bridge
across the Colorado River at Northwest,
Ten Thousand Dollars ($lO,OOO.OO)"
We are advised that this bridge has never been built
and there is no bridge of any nature at that site.
.
Honorable R. E. Gray, page 2 (WW-1082)
you inform us that all of the bonds in the 1938
Series have been retired and request an opinion as to the
disposition of the $lO,OOO.OO.
It is fundamental that proceeds from the sale of
bonds can be legally expended only for the purpose for which
they were voted.
Gordon v. Commissioners' Court of Jefferson
Countv, 310 S.W.Zd 761 (Civ.App.1958, error
ref. n.r.e.1;
Lewis v. City of Fort Worth, 126 Tex. 458,
89 S.W.2d 975 (1936);
Gillham v. Citv of Dallas, 207 S.W.Zd 978 (Civ.
App. 1948, error ref. n.r.e.);
Wright v. Allen, 257 S.W. 980 (Civ.App. 1924,
error'ref.);
Black v. Strenqth, 112 Tex. 188, 246 S-W.79
(1922) :
Moore v. Coffman, 109 Tex. 93, '200 S.W. 374
(1918).
Consequently, your first question, whether the
money can be spent on general road improvements in a cer-
tain precinct, is answered in the negative. ~~
your second question is: "If not, iiiwhich fund
shall the money be placed?" The bonds were voted under the
provisions of Acts 39th Leg., 1st C.S., Ch. 16, p. 23. Sec-
tion 12 thereof treats of then sale of-such~bonds and pro-
vides: ~.~~ .
* . . . the purchase money therefor shall
be placed in the county treasury of such
county to the credit of the available
road fund . . .*I ,-
In this case the money~may be,ljlaced in the avail-
able road fund but it may be expended only asp directed in
the voted proposition.
Honorable R. E. Gray, page 3 (WW-1082)
SUMMARY
Bond proceeds cannot be legally
diverted from the purpose for
which they were voted.
Very truly yours,
WILL WILSON
GW-s
APPROVED:
OPINION COM?UTTEE:
W. V. Geppert, Chairman
Joe Osborn
Arthur Sandlin
Linward Shivers
Reviewed for the Attorney General
By: Morgan Nesbitt