Untitled Texas Attorney General Opinion

Honorable Frsnk C. Clemens, C.“.airman Houston Light .Guard Emory Eoard of Control', Eouston, Texas ‘5

Eear 13. Clemens : Opinion :%To.0-24~7 ‘--* . _...b - -., .~ / : Texas National Guard \ Re .irciory Board -- S. 3. 427, 46th Legislature -- General Decartment- al Appropriation Bill -- hepair, upkeep and maintenance IIouston Life Guard Armory -- Kanner of Expending.

This will acknoaledge receipt of your letter of ?!ay 11, 1940, written on behelf of yourself as act-. ing Chairman, Eouston Light Guard Armory Board of Con- trol, and on behalf of i.r. C. 1;. Ninon, Secretary Texas National Guard Armory Board, i!rith respect to t:?e expen- diture of item 6 of the maintenance and miscellaneous zppropriation for Texas Xational Guard Armory Board contained in the biennial appropriation of the 46th Legislature, S. B. 30. 427, in :;hicti you propound the following questions: “1 * Is the Texas Xational Guard Armory Board authorized to pay out of the above mentioned approprietion for the costs of maintenence, repair, insurance and operating expenses of said Armory when purchases are contracted for under the approval and management OS the Armory Board of Control but not that of the Stste Board of Control? “2 . If question #l is ansvcered in the nega- tive, is it necessary that such purchases be contracted for under the aTprova1 and management of the State Board of Control? ,;3. If question’*%‘1 is ansv:ered~ in the nega- tive, whzt duty, authority CR’function? if any, must the Armory Boerd of Control e;:ercise ?nth respect to such purchases?

“4. Kay the exgenditres for t%e months of September and October be paid out of the above mention- ed appropriation and, if so, ii&t” si;o;:ing s:hould be made and v;hat Board’s a_n~roval is necessary before vouchering for payment?

Hon. Prank C. Clem ens - Page 2 . . .. probably be sufficient, but we would like to be certain with reference to your opinion as to which Roard Ml1 have the duty of renewing or rewriting suchinsurance and as to vrhat the proper procedure would be in order that the premium may be promptly paid. I I "6. ‘Yhen policies of insurance are to. be writ- ten, will it be proper to write and pay premiums out of such appropria~tion or similar .appropriations for a term that extends: “(a) Beyond the State fiscal year to which the appropriation applies; l’(b) Beyond the State biennium for which the applicable appropriation is available. "7. Kay the Armory 3oard pay to Houston Light Guard Veterans Association, Inc., as rental of the Armory for the months of September and October out of Item #3 of its appropriations from the last Legislature (Special Laws, 46th Leg. p. 148) sufficient, money to pay said ex- penses on condition that said Association will pay the ex- penses’ 16th the money so received?” iIouse Concurrent Resolution No. 3.0of the lt6th Legislature on behalf of the State accepts certain pro- perty in the City of Eouston donated, with certain’reser- vations, by the Houston Light Guard Veterans Association, Inc. for armory purposes; the resolution furthermore sets up what is knoiin as the Rouston Light Guard Armory Board of Control, i-;ith certain defined powers and duties. The d.nty of the Texas National Guard krmory Roard, as set forth in the resolution, is “to have charge of and pro- vide for the maintenance, repair, insurance and operating expenses of the said armory, and to keep the said property I in a good and fit condition for occupancy in use as an armory by the Eouston Light Guara., now designated as Com- pany G, 143d Infantry, Texss Xational Guard, and its successor military cor~panies.‘1 Item 6 of the Kaintenance and Miscellaneous Appropriation for Texas Mational Guard izmory Board, as made by the 46th LegisLg,ture, is as follovis: "6. Repsi-r, tpkeep and maintenance of Armory known as Houston Light Guard Armory, as contemplaged by Youse Con- current Resolution 30 of the 46th Legis- lature; provided that this appropriation is not transferable*f--YW :j1,140.00 for the fiscal years ending’ August 31, 1940;. and Jugust 31, 1941, respectively. _

Hon. Frank C. Clemens - Page 3: scribing the duties of the Board of Control provides: “The Board of’ Control shall pur- chase all the supplies used by each Department of the State Government, including the State Prison System, and each eleenosynary institution, Rorrral school, Agricultural and L:e- chanical Collage, University of Texas, and each and all other State Schools or Departments of the State Govern- ment heretofore or hereafter created. Such supplies to include furniture and fixtures, .technicel instruments .' and books, and all other things re- quired by the different departments or institutions, except strictly per- ishable goods.”

The powers of the 3oard of Control as thus pre- scribed are broad and comprehensive and confer upon the Board the power and duty to purchase all the supplies used by each department of the State government, except such supplies as are specially excepted in subsequent Articles, and the Te;ras National Guard Armory Doard comes within the purview of this statute, F’rom a consideration of the statute and the well- established policy of the State to constitute the Zoard of Control as its purchasing agent for institutional and de- partmental supplies for the Stcte, we beg to advise: Ve are of the %opinion the item of insurance does not come within the term %uppliesll contained in Article 634. The precise point seems to have been de- termined by the Supreme Court of Montana in Filler In- surance Agency vs. Porter, 20 Pac. (2) 643, where it is said: “This court in the case of New York Life Insurance Co. .v. Deer Lodge County, 43 Kant. 243, 115 P. 911, 912, in consid- ering the nature of a policy of fire in- surance, da: .I 'The policies are simply contracts of in>er:nity against loss (by fire), entered i3to between the corpora- tions and the assured, for a considera- tion paid by the la$ter. These contracts are not articles of commerce in any pro- per-meaning of the word. They are not subjects of trade.and,barter offered in the market as something having an exist- ence and value independent of the parties to them. They are not*commoditiee to be shipped. or fori~~arded _ from one state to _

Hon. Prank C. Clemens - Page l+

are like other parsonal contracts between parties which are completed by their sig- nature and the transfer of the considera- tion.' ’ ‘&he term ‘supplies1 has not been hold to include everything that is fur- nished to the state or a municipality. In the case of “!hite v. Koore, 288 Pa. i,c~l~, 136 A. 218, coal for the use of a school house was held not to be included vtithin the expression ‘school supplies. t Again, in the case of Xilwaukee Electric Railway Co. v. City of Yilwaukee, 173 YLS. ~329, 181 IT. I!. 298, electric current fur- nished to the city was held not to be in- cluded within the term *supplies, 1 in the statute requiring a contract that all sup- plies should ‘oe*l$t*after bids or proposals were received. If* * *vte held, that fire insurance policies are not included within the term ‘supplies. t St was, therefore, unneces- sary to procure bids or proposals before entering into the .contracts of insurance.” \Ie are inclined to follow the ZIontana case. Prom this conclusion it follows the Texas Rational Guard Armory Eoard? by virtue of Xouse Concurrent Resolution No. 30 creating it, is charged with the duty of provid- ing the insurance, and there being no strtute to the contrary, it is charged‘with the further duty of con- tracting for it. The Armory Board, however, would have no author- ity to create such a charge beyond the provisions of the Appropriation Act; that is to say, beyond the fiscal year to which the appropriation applies, and in no event be- yond the biennium for which the applicable appropriation is available. Fort Yorth Cavalry Club v. Sheppard, 83 s. ‘.!. (2) 6668. As a matter of economy it rcay be unvIi.se for the State to deny to its repi%sentstives the power to con- tract for insurance upon a-three or five year basis, but that is for the Legislature and not the Judicial or Ad- ministrative Departments of t+he State. Ye have several tines held that it is the policy of the State .to carry its own f?.re insurance. See Opin- ions 110s. O-184, O-201, O-342, O-1762 and O-2130. ‘i’his general policy is indicated by a legislative. resolution referred to in t3.e opinions. In the present case, how- ever. House Concurrent~Resoli1t.i nn 1Jn. ?A vnl--Q ++ +hn

Hon. fisck C. Clemens - Page 5, duty,of the Texas National Guard 2rmory Zoard and its successors "to nrovide for * * * insurence'1 upon said property donated by the ;-Iouston Life Guard Veterans Asso- ciation, Inc. The general rule of State policy, resting as it does in resolution only, is not applicable to the present case, since I:ouse Concurrent Pesolution X0. 30 evidences a contrary.?ule as to this particular property.

TrustinS that this general reply &ill have enswer- ed your questions satisfactorily, we are Very truly yours

By /s/ Ocie Speer Ocie Speer Assistant APPPOED cJlJ-EX 14, 1940 /s/ Gerald C. Kann ATTOl?XEY GEKQ?ALOF TEAS OS-5R:jrb . ~:~PROVXDOPIXIOX CO;I.IIT?EE BY DJB, Chairman