Untitled Texas Attorney General Opinion

           THE        AYITORNEP                  GENERAL
                         OFTEXAS
                       Amwm~.      T.!SLAS      78’711



                                  October      15, 1973



The Honorable Jimmie     D.   Oglesby               Opinion No.   H-   127
County Attorney
Permian Building                                    Re:   Use of Federal Revenue
317 West Texas                                            Sharing Funds to contract
Midland, Texas 78701                                      with a private non-profit
                                                          corporation   for the crea-
                                                          tion and maintenance    of
                                                          a rdcreation   center for the
Dear Mr.   Oglesby:                                       indigent aged

       You have asked our opinion as to whether a county may use federal
revenue sharing funds for purposes authorized under the Federal        statute
“but not authorized under the State Constitution or statutes. ” You state
that thecommissioners    court has been approached by a group of interested
citizens who have asked that federal revenue sharing funds be contributed
toward the creation and maintenance ,of a recreation     center for the aged.
The center will be operated by a private non-profit    corporation   which is to
charge small annual dues to those who can afford to pay and will provide
social and recreational services  to all senior citizens,   whether they be
indigent or not.

      The facts would seem to raise two questions:     (1) Is the suggested
use one which would be authorized under the Federal law and (2) Is it in
fact one which is authorized under the State constitution and statutes.

       The State and Local Fiscal Assistance  Act of 1972 (31 U. S. C., 5 1221)
authorizes the county, as a local government,   to, use revenue sharing funds
to create,  maintain and operate a recreation center for the aged. Section
1222 provides:

                   “(a) In general -- Funds received by units of
            local government    under this subchapter may be used
            only for priority expenditures.    For purposes of this
            chapter,   the term ‘priority expenditures’ means only--




                                    p.   613
The Honorable   Jimmie        D. Oglesby,        page 2   (H-127)




                    “(1) ordinary     and necessary        maintenance     and
             operating expenses       for --

                    I’..      . *

                    “(E)     recreation     . . . .

                    .,
                    ..
                       . . . .

                    l’(C) social    services       for the poor or aged.    . . . I’

        The rules and regulations    published by the Office of Revenue Sharing
in the Federal Register     of Tuesday,   April 10. 1973 (Volume 38, No. 68,:
pp. 9132-9143),   likewise approve the use of revenue sharing funds for such
purposes (31 C. F. R.,    $51.31), and th e 1egislative history of the act is replete
with references    to the basic purpose of the legislation    as providing “addition-
al help for the states and localities    in a form which will give them greater
flexibility in the use of the funds. . . .‘I (Senate Report No. 92-1050, August
16, 1972).

       Pursuant to The State and Local Fiscal Assietance      Act, the Secretary
of the Treasury   has issued a regulation [ 31 C. F. R. $ 51.40(c)] providing
that a government   which receives   entitlement funde under the Act. shall pro-
vide for the expenditure of those funds in accordance    with the law and proce-
dures applicable to the expenditure of its own revenues.

      Funds received under the State and Local Fiscal Assistance       Act may
not be used for a purpose not authorized by that Act or by the Constitution
and statutes of Texas.   However,   it is our opinion that the creation and main-
tenance of a recreation  center for the aged may be authorized under state law.

      We recognize         that the county and its governing body, the commissioners
court, can exercise         only such power as the Constitution and statutes of the
State of Texas have        specifically  conferred upon it and that the commissioners
court does not have        any general authority over county business.     Canales v,
Laughlin,  214 S. W.       2d 451, (Tex. 1948); Clark v. Finley,   54 S. W. 343, 347
(Tex. 1889); Article        5, § 18. Texas Constitution.




                                            p.   614
The Honorable     Jimmie   D.    Oglesby,        page 3   (H-127)




       The general grant of powers to the commissioners        courts is found
in Article 2351, Vernon’s    Texas Civil Statutes.    It does not authorize the
construction   or maintenance   of recreational facilities  per se.   It does
authorize the commissioners      to “provide and keep . . . all necessary
public buildings, ” and directs them to “provide for the support of paupers.                 ”

       We find authorization in Article 1015c-1, V. T. C. S., which, after
defining a governing body as including a county commissioners      court, pro-
vides

                    “Sec. 3. Any government     unit may establish,
             provide,   acquire; maintain,  construct,     equip, ope-
             rate, and supervise  recreational   facilities   and pro-
             grams.    . . .‘I

       The Act specifically provides that the costs and expenses of carrying
out the provisions  quoted above may be paid from the general revenues of
the county or from other revenue,    including grants,  and authorizes   joint
action by two or Moore governmental    units in the maintenance   of the facility.
This has been held to authorize a county, for instance,    to establish and
maintain a public golf course on land owned by a city.     Attorney General
Opinion M-804 (1971).

       It is our opinion, therefore,    that the county may, itself,   construct
and maintain a recreational    facility for the use of the public and primarily
for the use of the aged, under reasonable       regulations.   It may use federal
revenue sharing funds for these purposes.         The only remaining question is
whether the Constitution    or statutes prohibit a county from achieving these
purposes through an agreement        with a private non-profit   corporation.

       Section   52 of Article    3 of the Constitution      of Texas   provides   in sub-
section (3):

                    “Except as otherwise provided by this section,
             the Legislature    shall have no power to authorize any
             county, city, town or other political corporation     or
             subdivision   of the State to lend its credit or to grant




                                            p.    615
The Honorable   Jimmie   D.   Oglesby.    Page 4 (H-127)




            public money or anything of value in aid of, or to
            any individual, association or corporation  whatsoever,
            or to become a stockholder  in such corporation,   asso-
            ciation or company. ”

       The current construction   of this provision,is that it does not pro-
hibit the Legislature  from authorizing a county, city    or other political
corporation or subdivision to spend its funds with private corporations
for the achievement   of public purposes,    See, for example,   State v. City
of Austin,  331 S. W. 2d 737 (Tex. 1960) and Bullock v. Calvert,     480 S. W.
2d 367 (Tex. 1972).

       It is not unusual for political subdivisions     to contract with private
corporations    to perform   services  or functions which the governmental
unit might have provided itself.      For instance,    in Attorney General Opin-
ion C-246 (1964), it was held, after a very thorough discussion         of the law,
that a commissioners      court could contract with a private entity for the
care of indigent aged in a private facility.      In Attorney General Opinion
C-334 (1964), it was held that a hospital district could pay private hospitals
for the care of indigent patients.

       In Attorney General Opinion M-843 (1971). it was held that Potter
County could contract with a ‘private non-profit    institution  for the care
and supervision   of juvenile delinquents.   Other examples might be cited
but we deem the foregoing amply sufficient to support our conclusion that
a county may contract with a private non-profit      corporation   for the purpose
of creating and maintaining   a recreational  center designed for aged persons
under the same terms and conditions that the county itself could create a.nd
maintain such a center.

                                    SUMMARY

                    A county ‘may accept and use Federal revenue sharing
             funds to contract with a private non-profit  corporation to
             construct,  operate and maintain a recreationalfacility  de-
             signed primarily   for the aged.




                                          I/    Attorney   General   of Texas




                                     p.   616
The Honorable   Jimmie   D. Oglesby,    page 5    (H-127)




APPROVED:




                                       p.   617