OFFICE OF THE ATTORNEY GENERAL OF TEXAS
AUSTIN
Honorable W. J. UoConnell, Preeldmt
North Texarr State Teaoherrs Collage
Denton, Texan
Dear Sir:
Opinion Number 04eO;‘~ \
Re: Doe6 $hho‘.?Oaxd or Re+&nttr j
of Ncirth Texas State Teds&-
November 7th.
asp followa;
Veo. 1. * * * and the Board or R6genta or
the State Teaohere College * * l are hereby aev-
orally authorized and empowered to oonetruot or
aoquire through runas or loans to be obtalnsd
from the Government 0r the United States, or any
agenoy or agenolea .thereor, oreated under the
National Reoovery Aot, or oth%rwlse oreated by
.the Federal Government or from any other aouroe
Honorable W. J. EoConnell, page $8
private or publlo, without oost to the State
or Texas, and aooept title, subjaot to suoh
oondltlona and 1lmLtations aa may be presorlb-
ad by eaoh of said Boards, dormitories, kltoh-
ens and dining hells, hospitals, libraries,
student aotlvity buildings, -ala, athletlo
buildings and stadla, and auoh other buildinga
as may be needed ror the good of the lnatltu-
tlon and the moral welfare and social oonduot
0r the 5tUa5nt5 or such inetltutlona when the
total ooat, type or oonstruotlon, oapaolty or
suoh buildings, ee well as the other plans and
apeolrloatlons hsve been approved by the re-
spectlva Governing Boards; provided, hOwever,
that the Leglalature shall never make an ap-
propriation out or the general rpnd or thla
State, either in the regular approprletlon bill
or in a supplemental or emergenoy approprletlon
bill, ror the purpose or’ equipping or ror the
purpose or purohasing and installing any utility
oonneotlona.in any of the buildings ereoted under
and by virtue Or the provlalons or thla Aot.*
"QBO. i?. * * * That said Boords are further
authorized to make any oontrsot with reference
to the collectlon ead dispodltion of the revenuee
&rived rmn anr builainix a0 oonstruoted in the
5OWi.5itiOn OT OOI35trUOtiOn. loeMK5ment. and main-
t5nanOe of any buildlnR or buildinna’aoauired
hereunder. In reference to the aoquisitlon or
student activity bulldlngs, stadla, gymnasia, and
all oharaoter or athletlo buildings, sald,Boarda
are authorized also to make oontraote with refer-
ence to the oolleotlon 6na disposition or rqvenuea
to aoorue to suoh respeotlve lnatltutlone rrom
sctlvltlea, athletlo events, and games in which
said reopeotlve institutiona psrtlolpate away
from said Institutions, a6 well as at said inetl-
tutlons; and in antlolpatlon oi the colleotlon oi
such revenuea, and for the purpose of paring the
cost or the oonetruotlon or aoqulsltion 0r eald
Honoreblb V. J. YoOonnell, page $3
‘building or buildings and grcunda, said Boards
are severally ampolosred by resolution to euthor-
ize, sell, and~dellver lta negotiable bonds or
notea mm tima to tlaas OBd in suoh emount or
amounts as It msy oonalder naoeasary. The reea
and otmrgea so rlxad ror the use or any such
bulldlng.or buildings shell not be collected
arter payment In full shell have been oonpleted
ror the bullding or bulldlnge Sor which said
rees shall be pledged. Theraatter the right
of said respaotlve Boarde to fix oharges en$
fees shell depend on laws other than this Act
ae hereby- emended. Any bonds or notes Issued
hereunder shall beer lntereat at not to exoeed
air (6% ~per oent per annum, and shall-rlnally
meture not more. than forty years from data.”
Wee. 3. Sub&at to the above reatriotlona,
each of said Boardd Is given complete dlsoretion
In riring t?ie r0m,. oonaltlona end betalla or
suoh bonds or notesb’ Any bonds or notes issued
hereunder shell not be an indebtedness’b~ the
State of TemS,‘but ahall be -payable solely ‘rrom
the revanuaa to be derived rrom the operetion~ or
seld buildingsi provided that euoh bonda msy be
retlnanoed by.the aaLa Boarda whenever auoh aotlon
is round by the Board to be neoetmaryi
WProvlded,~ however, that tbe~ provIalona or this I
Aot shell not epply,.~to, any proceadlnga, levlae, or
to any bonde or warrenta issued thareunder, the
valIalty or which baa’been Oont56tQd or attachsd
in suit or lltlgatlon.whIoh la pandI!q at the-time
this Act becomes e law, or which may be riled with-
in thirty (30) dsya.qrter this Aot:beoonee a law.”
.~~.
‘+ ‘*~~ * a Y /
“See. 9. further
movlaea that each or said
Boards meg meke such oontreota aa rzay be neces-
-
Honorable X. J. UoConnell, page $4
Under thIa artlolc the Legislature has author-
lzad the Boer8 of Ragents of North Texas Ststa Teaoher6
College to aoqulre oertaln revenue-bearing property and
to make any oontreot with re~erenoa to the oolleotlon and
dlsposftlon or the revenuea derived rrom any bulldlng so
oonstruoted in the aoqu.lsltfon or oonatruotlon, msnega-
ment ana z3alntenenoe of any beilalng or buildinga aoqulr-
ad thereunder.
Thererore, it ii3 the oplnIo~ or this department
that the Board ot Regents has the authority to enter into
a contreot with reference. to insuring said property and to
pledge a portion or the lnooloe from revenue-bearing proper-
ties .for lnsuranoe purpoaes;when said property has been ao-
quired under the euthority,, of Artlole 26030, Vernon’s Anno-
tated Civil Statutes. :i
Ii bonds are Issued in Fayment or the ‘oonstruotlon
or buildinga euthorlzcd under- thla article, it la our opin-
ion that the Board hns the authority to oontraot in the
bond order that a ~oertaln portlcn of the rev8nuea be set
as186 to pay for the lnauranoe on said bulldln&3.r,; The bond
order in suoh ceaea usually oontalna a olausa ei3ltlar .f,o
the following t
93uoh portion Gr the grosa revenues CO be
received rrom the operation or said ~dormitory
as ~%y be required to oreate and melntein the
runae hereinatter provided tar shall be set
eslae monthly into two separate end spcolal
funda, which are hereby provided tor,and oreat-
ed, the first of which funds ahall be known as
CFER~ITICN AXD h%I?iENA?:CE Z’CXD, and the seoond
Or which shall be known ae BONDFrm, There
shell be kept within the BGSD FED a sreolal
aocount hereby provided for and cr%attd,,, known
as the RESXRVXACCOUNT. The OPERATIGN A?JD UAIN-
TmxcE FUNDshall be at all times eutrioient
to provide for tho reasonable cost or maintain-
~~~~~~~~~~~~~':~~~~~l~~~u~~~~~ :Ei%&+F-
shall be :n the amounts and
aoomuleted In ihe manner~proviaea ror * * **
(~ndersooring ours).
31
Honorable W. S., bWonnel1, page #S
However, we aall your attention to the fact tbst
this depesrtaent kas repeatedly held that no insurenoe
polioy ahull be takeri out upon any of the publlo building8
OS thin State, nor upon the oontentr thereof, in the ab-
senoe of 8 speoltio appropriation for that pwrpoee. The
reason for thle holding la atstsd in our opinions xwtibers
o-3000, O-104 and o-201, oopler of which are enclosed ror
your informtion.
Theretore, fire lnsuranoe Fremiwne cannot be paid
out of the loos1 oolleqe funan or coy otber rued or the
college, In the absence of express le&ilstive authority.
However, Artiole 2CkO3ogives to the Board of Regenta power
tq oontraot to keep buildings erected under the authority
or that artlole insured ror the protection of bondholdera.
Such insuranos remltms my be aid only out ot the reve-
nues collected Bron the partlcu Par building or build3qa
covered by the bond iaaue.
Trusting thet- thle answera your questIon, we are
P.ICW?ASSISTANT
ATTCI~XYGENERAL
COB-s
%lols.