- c
THEA'FI'ORNEY GENERAL
July 20, 1960
Mr. Moore Lynn Opinion No. WW-886
County Auditor
Dallas County Re: Does Senate Bill 178, Acts
Records Wilding 56th Legislature, Regu-
Dallas, Texas lar Session,1959,require
that the Dallas County Hosp-
ital District be included in
the annual independent audit
along with the records and
books of Dallas County and
Dear Mr. Lynn: related questions.
Your letter of recent date requests the opinion of
this office on two questions:
"1. Does Senate Bill 178, 56th Legis-
lature, Regular Session, require that the
Dallas County Hospital District be included
in the annual independent audit along with
the records and books of Dallas County?"
Under date of January 15, 1960, an agreement was
made between the County of Dallas, Texas, and Haskins
& Sells, Certified Public Accountants, to makea general
audit of the financial records and accounts of Dallas
County.
"2. Is an audit of the Hospital Dls-
trlct covered by the contract between Dal-
las County and Haskins & Sells?"
Section 1 of Senate Bill 178, Acts of the 56th Le is-
lature, Regular Session 1959, (codified as Article 16 &l-d,
Vernon's Civil StatutesI provides as follows:
"In every county In the State of Texas
having a population of 350,000 Inhabitants
or more, according to the last preceding
Federal Census, an annual independent audit
.. -
Mr. Moore Lynn, Page 2 (W~886)
shall be made of all books, records, and
accounts of the district, county and pre-
cinct officers, agents or employees, ln-
eluding regular auditors of the counties
and all governmental units of the county
h~~nF~~~n~~l~"~~~t~~~t~~~~~~~~ng
to the fiscal affairs of the county."
(Emphasis ours)
Attorney General's Opinion ~~-763 held that the
word "county", as used In the preceding Article, must
be treated as referring to 'county government."
This opinion states:
The word 'county' is used re-
peatediy'and consistently in the act In
such a way as to mean the political unit
of government rather than the geographical
area. If otherwise construed the act
would require an audit of every lnstltu-
tion, public and private, In the county
area. . . .”
"It seems clear to us, however, that
the Legislature actually Intended for the
Act to apply only to county government
and the various units, institutions and
agencies thereof. . . .'I(Rnphasls ours)
"Further, Sections 3 and 4 of the
Act are JxXWEisLVe in this respect since
they provide for the employment of the
auditor by the County Commissioners Court
and further provide for the auditor to be
paid out of the general fund of the county.
It is unlikely that the Legislature would
give the duty of employing the auditor to
the Commissioners Court if the audit were
Intended to be directed at other units of
Moreover it is especially
the Legislature would require
the expenditure of county funds for the
audit of some other unit of government which
has Its own tax moneys, and which would re-
ceive the benefit of such audit." (Emphasis
ours)
I .-
Mr. Moore Lynn, Page 3 (WW-886)
In view of this, the answer to your question hinges
upon whether or not a county hospital district Is a unit
of the County or a governmental unit of the county
hospitals.
The Commissioners Court of any county shall have the
power to establish a county hospital and to tax the pro-
perty in the county to provide for the maintenance there-
of. Article 4478, Vernon’s Civil Statutes. It is wlth-
out question that this type of hospital is a unit of the
county. The tax mentioned above is for county purposes
and cannot swell the county purpose tax above the constl-
tutlonal limit. Attorney General's Opinion No. O-6636.
Article VIII, Section 9 of our Texas Constitution
provides "but in no event shall the total of said fore-
going taxes exceed eighty (80) cents on the one hundred
dollars valuation, in any one year.” Many counties in
Texas levy and assess the maximum tax authorized by this
Article. They are curtailed from establishing a county
hospital because of the constitutional limitations on
taxes.
Because of this and other reasons, there was a need
for a new and additional governmental unit with the power
to levy a tax on property. With this In mind, the people
of Texas In 1954 voted upon and adopted an amendment to
the Constitution authorizing the Legislature to provide
for the creation of county hospital districts In certain
counties and providing that such districts shall have
the authority to levy a tax not to exceed seventy-five
($.75) cents on the one hundred ($100.00) dollars valua-
tion of all taxable property within such district. Arti-
cle IX, Section 4, Texas Constitution.
The enabling Act passed b the Legislature (Article
4494n, Vernon's Civil Statutes'(provides for the establlsh-
ment of a hospital district with the power to levy taxes
upon the approval of the property taxpaying voters of the
county. It further provides the hospital district shall
be managed, controlled and administered by a Board of Hosp-
ital Managers appointed by the Commissioners Court. Various
county officials have certain authority in regard to some
functions of the district. For example, Section 2 provides
that the tax so levied shall be collected on all property
subject to Hospital District taxation by the Assessor and
Collector of Taxes for the county on the county tax values
*- -
Mr. Moore Lynn, Page 4 (WW-886)
and in the same manner and under the same conditions as
county taxes. However, it further provides that the
Assessor shall charge and deduct from payments to the
District fees for collecting the tax not to exceed one
and one-half (14%) per cent of the total amounts collect-
ed. Also, Section 6 states that the Commissioners Court
of the county has the power to prescribe the method and
manner of making purchases and expenditures by and for
such Hospital District and also shall be authorized to
prescribe all accounting and control procedures. But
the Hospital District must pay all salaries and expenses
necessarily Incurred by the county or any of its officers
and agents In performing any duties which may be prescrlb-
ed or required and it shall be the duty of any officer,
employee or agent of such county to perform and carry out
any function or service prescribed by the Commissioners
Court.
We believe this reveals the true Intent of the
Legislature. If a County Hospital District Is a unit
of the county, why then must it pay the county for ser-
vices rendered by county officials? If it were a coun-
ty unit, these services would be an official duty of
the officer for which no extra compensation would be due
the officer or the county.
It may be argued, however, that because county
officers have certain duties in regard to the Hospital
District and the fact that the boundaries of such Dis-
trict are co-extensive with that of the county, that It
is a unit of the county. This. however. is without merit
In view of the recent Supreme Court decision Bexar Count
Hospital District v. Crosby, 327 S.W. 2d 445.d
opinionwrittentice Hickman, he referred to
the Bexar County Rospltal District as "a political sub-
division of the State," "a corporation" and "a different
governmental body" from that of the City or County,
In view of the foregoing, It is our opinion that the
books, records and accounts of a county hospital district
are not books, records and accounts of the county govern-
ment. Therefore, you are accordingly advised that the
Dallas County Hospital District should not be included in
the audit provided for by Senate Bill 178, Acts of the
56th Legislature, Regular Session, 1959.
Mr. Moore Lynn, Page 5 (W-886)
Your second question will not be answered In view
of the above ruling.
SUMMARY
The Dallas County Hospital District should
not be included in the annual Independent
audit of Dallas County as required by Senate
Bill 178, Acts of the 56th Le islature, Regu-
lar Session, l%g.(Article 16 & l-d, Vernon's
Civil Statutes.)
Yours very truly,
WILL WILSON
Attorney General of Texas
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APPROVED:
OPINION COMMI!E'EE
W. V. Geppert, Chairman
Joe Allen Osborn
L. P. Lollar
C. Dean Davis
Lawrence Hargrove
REVIEWED FOR THE ATTORNEY GENERAL
BY: Leonard Passmore