. 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