OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AUSTIN
mnorabie Cohn H. Shook
Crlmlnal Dlatrict Attorney
Bra County
m Antonio, Texas
Dear sir: 0plnion lo. O-6448
80: Lsga11ty 0
to bo ieeu
pore or re lloI
held by Be rir-
tlaa or the
‘n‘e ye ln rece~y\~~eoent dote, read-
ing 88 rollowo-
opinion rela-
e original request of the
ing this requeet, certain personeli-
nto the dlsouesion thereof, end oer-
ted acouaatlonm hare been directed by the
bonding companies toward8 this oliloe, and for this
reaeon we deem it advieable to tranemit to you this file
with the request that you kindly answer the legal quea-
tions propounded by our County Auditor, aa wall 88 an
additional question which thle orrice wishes to pro-
pound to you.
or the provIslons or fib. 2368h of the HevIeed Ciril
Statute8 of the date of Texas, and are suoh bond8,
we believe, ti61ar,e held to be not refundable In the
cmae or Jarrereon County v. Sellers, 180 5. W. (26)
5t pags 138.
“It would thererore eeen that if the same are
therefore rerun&able, they would be so by virtue only
ot the fact that they tire owned and eontrolled by the
refunding authority.
*you will not* also rror the letter or tb county
,&iitor to thie orfice thnt there 18, clt thu prsrrmt
thus, in tlm sinking ibid of the8e meveral bond8, the
aggregate 8ua 0r Sixteen thouaad ($16,000.00) Dollar*,
wbioh is at thirr time available for tha purpoee of re-
tiring a portion of the bond8 now in Bexar County*8
hands, and eought by thin oontraot to be refunded.
*The queotionr propounded by the County Auditor
ara as r0liow0:
*‘(1.) Oan them rour bowl imues be legally
reiunded, am t&me bond8 1881~8 afo
eria bond@ and ~FO not op ional bonda?
r See 6 ookran County Ca8e ana Parasaph 3
or thie letter)
“( 2) Il? these bonds oan be legally refUnded,
aan th6y be rerunaed by a bond irreue with
a mturity ubaequent to the maturity of
the bonds being rerunbed? (bee Paragraph
5 or this letter)
“( tith above referencea belug to the lettsr of
tb county Auditor)
“In addition thereto, the queetioa propounded by
thli# @ifloe 18 aa follow8~
“There being In the verioua afnk~idna;funds
or the bead iesuaa in quemaioa the sua or
gla,ooO.Oo, which ia available tar the pur-
pose or retiring bonar now nought to be re-
run&e&, is It or uot incumbent upon the
CommIseionero* Court to apply suoh fund8
to the rettra~ent of the available bond8,
and refund only that portion in exoe88
or auoh amunt?
"Your early anewer to the above queatione will be
greatly appreoiated by thie offlOe.*
The Ziret question propounded by the County Auditor 18
a8wered in the arrirmatire. The matter of refunding outstanding
bonds 18 one for the Conxni88ioner8* Court to determine. 8eotion 7
of artiole 2st@A rradm,in part, a8 follow8:
"See. 7.
The Co:nmi8sionerr* Court of any oounty
or the governing body oi any oity in the State of Tcxa8
mny pws all neoessary order8 and ordinanae8 to provide
for funding or rerunding the whole or any part of the
legal debt oi euoh oounty or city, by oanoelling evid-
ences thereof and issuing to the holders or oreditorr,
notea, bon&e or treasury warrants with or without coupoxu,
bearing intereet payuble annua&l~ or 8eni-annually at a
rate not to exoe.4 six per cent r S$) per u&mm. The
uerofae oi much authority ahall ba rsguhted a@ follow8:
"(a) Suoh Commi8eioner8~ Courts and euoh governing
bodism shall have the ri tet all time8 to 188~ raiund-
ing bond8 ior the refun a.?ng of any outetandlDg bond8 legal-
ly 18eued and outstanding matured intereat on any leglly
18sued outstanding bonds, subject to law8 applicable to
the irauanoe of refunding bond8 and without the neae88ity
or any notice or right to a referenduta vote.
"i 1 *
*(o) * * * The runding bona8 hereb nut c ed
shall be payable ssriolly not eroeeding Iortyhpdf year8
iron the date thereof, unless oomi88ioner81 aourte or
governing body affirm&ively adjudge that the f lnsnoisl
oondition or euoh oounty or oity will not permit in 8uoh
installments aa will make tbr, burden of taxation to rup-
port ewe, approximately uniform throughout tin term of
8816 bond Ieeue. 3uoh bonds 8hall be axeouted and 18-
sued in the same manwr no1 provided by law for the
220 “.
mwrsble JOhh d. &hook, &ge 4
I
lxeoutioh and issuance of bond8 to refund outstanding
county or olty bonds. Said bond8 shall bear Interest
sot eroeedlng six per osnt (6%) psr ahnun, and rhall
be approved by the 4ittorney General and registered by
the state Comptroller in the same ;Mnner as other oounty
or city refunding or runding bmkn
TAO CoOhran ColUlty case tild that bond8 ierued under a
partioular ohapter were optional whether expressed im the proceedinga
cr not, but did not hold that bond8 whioh were not optional could not
bs rerunded with the consent Or the holder8 or suoh bonda. Yince the
&xar County bond8 tire owned by 8inking rWd8 of oertain othsr bond
irruea under the oontrol 0r the Oo3missioner8* Court of &rar County,
ad that oolirt ha8 oonsented to the rerunding thsrwi, it i8 tb
opinion of this departmnt that the four 18suer of bonda mq be
legally rerun&s&. ThI8 department ha8 alwaya approvrd rerunaing of
non-optional bond8 with ths oonaent 0r the holder8 0r aame.
The opinion in the oaae of Road Distriot Ho. 1, Jerter8on
Ooanty v. tieller8, 12O 8. V. (2d) lM, does not hold ttlat bond8 oannot
be refuuaed with the coneent 0r the bolder8 0r the outstanding bondr*
on the oontrary it hold8 that they may be rerunded with 8uoh oonsent.
We quote the foilowing from thm opinion of the Court in that oaae:
-That article dose anthoriu blWi88iOlur8' COUZtE
8ought to be refunded we- then redeemable, or when the
oould be redeemed with ths eonoent ot the ownerd '
\rtalio8 our*)
The second question 18 anmered in the arrirnratira alao.
The only limit,ition in the law 18 that they Ohall mature not exeeed-
ing forty (40) year8 rrcm their date.
In answer to the quertion propounded by your offloe, wo ‘,
think it 18 a matter within the discretion or the Oommi88loners*
Cooit, except that bond8 maturingwithin the ourrent year, ii any,
should bs paid out or the #16,000 in the sinking fund. We are of
the opinion that the xttorney Oeneral 1s wlthout authorltf to require
the county to apply this money on iuture maturitioa. In the Oa8e of
city or E;aoo f. &UUI, 127 S. W. (26) 879, it was agoad that oertain
bond8 were due or would be due during the then ourrent year and that
223.
the oity had i0ma and 00u00tea tare* 8urfiolont to pay mm.
Tbr ktt0m.y General ooatenaea that said bona8 80 mturing should
Q# paid with the money oolieotea for that .purposoana @hOuld not
b r0fwia0a. The Court held that the Attorney G4naralwan oorreot
a that oontrntion.
Your8 tory truly
ATTolUUY GZNEXAL OF TEXAS
By ub
‘C. 1. Gibron
Arrcrlstant
c