Untitled Texas Attorney General Opinion

    .                                                         R-220
                                                                            233




                                  April    If;,   1947

        Hon. Henry G. Lehman, Chairman            ’
        Insurance Committee
        House of Representatives
        Anstln, Texas            opinion          No. v-147
                                     Re:    Constitutionality  of H.B.
                                            665 and 666 relat lve to
                                            group insurance on the
                                            lives of employees of
        Dear Sir:                           state and district   schools.
                    We refer to your inquiry concerning  the conztl-
    ,   tutionality   of House Bills Nos.   665 and 666, 50th Leg-
        islature,   aou pending in the Jnzurance Committee of the
.       House of Representatives.

                   Both bills   are for the purpose of adding pro-
        visions to existing    law authorizing   school systems, as
        employers,  to pay all,    or a portion,   of the premiums on
        group insurance policies     for the benefit   of employees
        of such achoolz,   with money belonging     to such employer
        district;  or, alternat ivoly,’ such employers are given
        the power to make salary deductions      from pay warrants
        of such employees for such premiums.
                    Rouse Bill No. 665 includes      “The State of
        Tbxns and any of Its designated       agents ‘or agencies,
        with rezponsibil1tg     or authority   for public education,
        such as common and independent school boards, Boards
        of Regents of State colleges      and universities,    the
        county school boards, or any other agency of and with-
        In the State by which a person may be employed in pub-
        lic education,    hereinafter  referred    to as public school
        employees”,   and also includes     insurance for health,    ac-
        c ident, accidental    death, dismemberment and hospital,
        surgical   and medical expenses for the benefit       of em-
        ployee a.
                  No method is provided in either of these bills
        by which an administrntive  board may determine the per-
        centage of the premium which may be paid in mrt by the
        school employers and in part by its employees,  or how
        much of such premium shall be pald by the employees; nor
‘_.zni          Hon. Henry 0. Lehman, Page 2, F-147



                 Is there any provision    requiring    the consent of the em-
                 ployees of school employers to deductions        from their
                 salaries  to pay premiums on insurance policies.        House
                 Bill No. 666 merely provides      that the amount OS inzur-
                 ante shall be “based upon some plan which will pre-
                clude individual   select Ion. ” That language is taken
                 from the law which the bill      seeks to amend, but it
                 creates confusion    in an effort    to construe the law
                 which the bill re-enacts.

                             We are attaching   copies of our Opinions Nos.
                O-2469,    O-2838 and O-3541,   which are pertinent  to your
                inquiry.
                           In Opinion No. O-2469, Honorable T. 0. ,Walton,
                President of A & M College,    was advised that premiums
                on group insurance policies    may not be lawfully paid
                with mopey derived from student fees, local funds or
                other inst it utlonal f undz under the jurisdiction of
                the Board of Directors    of that college.
            ‘
        v                    Opinion No. O-2838 advised Honorable T. M.
                Trimble, First Assistant     State Superintendent   of, Public
                Inztruction,    that the Board of Trustees of the Fort Worth
                Independent School District      may not lawfully  use local
                maintenance funds to pay the employer’s       part of a group
                life  insurance premium for teachers;      and also that such
                school trustees     may not lawfully  include such premiums
                in teacher’s    contracts  as part of such teachers’ salar-
                lez because such added sums to pay such premiums would
 _...           not thereby become a part of such salary in fact and
                would remain public money.
                           In Opinion No. O-3541, this department defined
                “Available  School Funds” and advised Honorable Lon B.
                Alzup, Chairman, House Conference Committee, that admln-
                iztrative  costs of dlvlzionz of the State Department of
                Education cannot be paid from the State Available School
                Fund.                          ,

                             Wi adhere to those   opinions.
                            Both of the bills   under consideration  contem-
                 plate the use of public monies to pay premiums on group
                 insurance policies    for the benefit  of employees of school
                 employers.    Such money is to be paid by the school em-
                 ployer directly    or is to be withheld as salary deduc-    I,
                 t ions, with or without the consent of such school em-
                 ployeez.
        Hon. Henry G.. Lehman, Page 3,      V-147.                           235

                     .
                     Sections 51, 52’and 53 of Article  III of the
        Constitution     stand as obstacles to the grant of public
        money to school employees for such purposes.

                   The pertinent    part    of Section   51 reads:
                    “The Legislature    shall have no power to
             make any grant or authorize       the making of any
             grant of public money to any individuals,        as-
             sociation    of individuals,    municfipzl or other
             corporations    whatsoever,    , . .
                   The pertinent    part    of Section   $2 reads:
            ,,,..     “The Legislature    shall have no power to
               authorize    any county, city,    town or other pol-
               itical   corporation    w  subdivision   of this State
               to lend its credit      or to grant public money or
               a thing of value in aid of, or to any individ-
    a          ual, ?,szoclation    or corporation    whatsoever..
               . .. .

1                 School employees are ‘individuals’           and groups
        of them are. “associations of Individuals”.

                    The pertinent    part   of Section   53 reads:      ..
                    )I . . . nor pay, nor authorize  the pag-
              meat of, any claim created against any coun-
              ty or municipality   of .the State under any
              agreement o$ contract,    made without author-
              ity of law.
                      In the case of Harllngen Independent School
        District     vs. C. H. Page & Bro., 48 3. W. 2d 983, Sec-
        tlon A of the Commission of Appeals of the State of
        Texas, decided that an Independent school district            is
            “municlpallty”     within the conzt it ut icnal provision
        “precluding     the legislature   from paying or authorizing
         ‘municipalltlez”      to pay claims created against “mun-
        icipalities”      under a contract   made without authority
        of law.

                   Section 5 of Article    VII of the Conztitut ion
        provides  that:
                    II . . . the available  school fund shall
              be applied annually to the support of the
            Hon. Henry 0. Lehman, Page 4, V-147
                      .



                     public free schools.     And no law shall ever
                     be enacted appropriating    any part of the
                     permanent or available    school {und to any         .,
                     other purpose whatsoever.     . .
                          Article 2837, Vernon’s Civil Statutes,        reg-
            ulates     the use of schoql funds as follows:

                            “1.   The State and county available
                     funds shall be used exclusively     for the pay-
                     ment of teachers’ and superintendents’      sal-
                     aries,   fees for taking the school census,
                     and Interest    on money borrowed on short time
                     to pay salaries    of teachers and superlnten-
                     dents, when these salaries     become due be-
                     fore the funds for the current year become
                     available    . . .
                             “2. Iocal funds from district    taxes,
        .            tuition    fees of pupils not entitled.  to free
                     tult ion and other local sources may be used
                     for purposes enumerated for State and county
                     funds and for purchasing appliances      and sup-
                     plies,    for the purpose of payment of lnsur-
                     ante premiums, janitors     and other employees,
                     for buying school sites,     for buying buildings
                     and repairing    and rent1n.g school houses, and
                     for other purposes necessary      in the conduct
                     of public schools to be determiied      by the
                     Board of school trustees      . . .

                          The Insurance premiums mentioned In that law,
            are ior     insurance for the protection of school property
            against     danage.
                      We are further of the opinion that deduct ions
            may not be made from compensation warrants of employees
            for the payment of Insurance premiums, without the con-
            sent of such employees, because such deductions would
            deprive such employees of their property without due
            process of law in violation   of Section
                                                 - - 19, Article I,
            of the Constitution  of the state of Texas, and the
            Fifth and Fourteenth Amendments of the Constitution    of
            the United States.




. .._
.   r           Hon. Henry 0. Lehman, Page 5, V-147
                             .


                                          SUMMARY
                           House Bills     665 and 666, 50th Legls-
                     lat ure , authorizing    school of~flclals   to
                     pay premiums on insurance policies         with
                     public money for the benefit       of employees,
                     are void because they would authorize          the
                     making of a grant of public money to ln-
                     dlviduals    and assoc lat ions of individuals
                     in violation    of Art. III, Sects. 51, 52,
                     53 of the Texas Const ltutlon;      and because
                     they would .authorlze     the use of publ,lc
                     school funds for a purpose other than the
                     support of the public free schools.           Const .
                     of Tex., Art. VII, Sects. 3, 5.
                                                    Yotiiv very   truly,

                                     .         ATTORUEYGENERALOF TEXA3
        ’   .




                                               BY




                WTU:rb:erc:dr:mrj              ATTORNEYGENERAL