Untitled Texas Attorney General Opinion ( 2004 )

ATTORNEYGENERAL OF TEXAS
GREG ABBOTT
December lo,2004
The Honorable Jo& R. Rodriguez Opinion No. GA-0280
El Paso County Attorney
County Courthouse Re: Whether the Border Health Institute is a state
500 East San Antonio, Room 503 agency for various purposes (RQ-0229-GA)
El Paso, Texas 79901
Dear Mr. Rodriguez:
You ask whether the Border Health Institute created under Texas Education Code chapter
15 1 “generally qualities as a state agency, and whether it: (1) is entitled to sovereign immunity; (2)
must comply with the Texas Open Meetings Act; (3) must complywith the Texas Public Information
Act; (4) must follow state procurement and contracting rules; (5) must follow civil service rules; and
(6) must obtain non-profit corporation status to be able to solicit funding.“’
I. Background
The Seventy-sixth Legislature established the Border Health Institute (the “BHI”) in 1999
as a “collaboration or consortium of independent public and private entities.” TEX. EDUC. CODE
/INN. @ 15 1.001-.002(a) (Vemon2002). Section 151.002 provides for the establishment ofthe BHI
and describes its purpose:
(a) The Border Health Institute is established in the city of El
Paso.
(b) The institute shall operate in a manner that facilitates and
assists the activities of international, national, regional, or local health-
related institutions working in the Texas-Mexico border region to:
(1) create and fund centers or component
units within the institute to facilitate research in fields
of study affecting public health in the border region,
including researchrelated to diabetes, Hispanic health
‘Letter fromHonorable Jest R. Rodriguez, El Paso County Attorney, to Honorable Greg Abbott, Texas Attorney
General (May 17,2004) (on tile with the Opinion Committee, also avdable af http://www.oag.state.tx.us) [hereinafter
pequest Letter].
The Honorable Jose R. Rodriguez - Page 2 (GA-0280)
issues, infectious diseases, emerging infections,
environmental health issues, and children’s health
issues;
(2) deliver health care or provide health
education to persons living in the border region; and
(3) conduct and facilitate research in fields of
study affecting public health in the border region,
includingresearchrelated to diabetes, Hispanic health
issues, infectious diseases, emerging infections,
environmental health issues, and children’s health
issues.
Id. 5 15 1.002(a)-(b). The bill analysis corroborates that the purpose of the BHI “is to deliver health
care or provide health education to persons living in the border region and conduct research in fields
of study affecting public health, including research related to infectious diseases, diabetes,
environmental health issues, and children’s health issues.” HOUSE COMM. ONHIGHEREDUC., BILL
AI\IALYSlS,Tex. H.B. 2025,76th Leg., R.S. (1999).
The initial governing board of the BHI was composed of the chief executive officer or
president, or their designees, of the following nine institutions:
(1) The University of Texas at El Paso;
(2) Texas Tech University Health Sciences Center at El Paso;
(3) El Paso Community College District;
(4) R. E. Thomason General Hospital;
(5) El Paso City/County Health District;
(6) The University of Texas Health Science Center at Houston,
School of Public Health:
(7) El Paso County Medical Society;
(8) Paso de1 Norte Health Foundation; and
(9) The Texas Department of Health.
TEX. EDUC. CODE ANN. $9 151.003(a), .004(a) (Vernon 2002). The governing board is authorized
to adopt procedures for “changing, adding, or removing entities as members of the institute and
creating development or advisory boards for the institute.” Id. 5 151.003(b). At present, the
following institutions hold voting positions on the BHI board
The Honorable Jose R. Rodriguez - Page 3 (GA-0280)
. El Paso City-County Health and Environmental District
. El Paso Community College
. El Paso County Medical Society
. Texas Department of Health
. Texas Tech University Health Sciences Center at El Paso
. Thomason Hospital
. University of Texas at El Paso
. University of Texas, Houston, School of Public Health,
El Paso Campus
See TEX. DEP’T OF HEALTH, BORDER HEALTH INSTITUTE, available af http://www.rlO.tdh.state
.tx.uslobhbhi/bhi.htm (last visited Oct. 6,2004). TheBHI governing board is required to adopt rules
governing operations and deliberations of the board and the institute, and the governing board may
hire an executive director and staff necessary to operate the institute. See TEX. EDUC. CODE ANN.
3 15 1.004(b)-(c) (Vernon 2002). The governing board is required to meet at least once a year “to
review the progress of the institute and to determine the institute’s future actions and operational
plans.” Id. 5 15 1.004(d).
Section 15 1.005 of the Education Code describes the funding for the BHI and provides:
(a) In addition to any amount appropriated by the legislature,
the institute may apply for and accept funds from the federal
government or any other public or private entity. The institute or any
member ofthe institute may also solicit and accept pledges, gifts, and
endowments from private sources on the institute’s behalf. A pledge,
gift, or endowment solicited under this section must be consistent
with the purposes of the institute.
(b) The governing board of the institute shall manage and
approve disbursements of appropriations, funds, pledges, gifts, and
endowments that are the property of the institute.
(c) The governing board of the institute shall manage any
capital improvements constructed, owned, or leased by the institute
and any real property acquired by the institute.
Id. 5 151.005(a)-(c). Under section 151.006, physical facilities to be used in research projects,
provision of health care, and education programs may be “provided [to the BHI] by a public or
private entity or by a cooperative, consortium, or joint venture consisting of public or private
The Honorable Jose R. Rodriguez - Page 4 (GA-0280)
entities.” Id. 5 151.006. Additionally, a physical facility “may be constructed, maintained, or
operated with funds the institute receives under Section 15 1.005 and any funds appropriated for that
purpose.” Id.
A bill analysis prepared by the House Research Organization in 1999 notes that “[i]n
December 1998, the University of Texas System and Texas Tech University signed a collaborative
agreement dedicated to creating a future health campus in El Paso. Establishing the Border Health
Institute would be the next logical step.” HOUSE RESEARCH ORGANIZATION, BILL ANALYSIS, Tex.
H.B. 2025,76th Leg., R.S. (1999). The Texas Department ofHealth’s website described the status
of the BHI in early 2003. See TEX. DEP’T OF HEALTH, BORDER HEALTH INSTITUTE, available at
http://www.rl O.tdh.state.tx.us/obhibhiibhi.htm (last visited Sept. 4,2004). Although the legislature
in 2003 did not fund the remaining two-year program of the Texas Tech Health Sciences Center, it
did nevertheless provide funding for the BHI as part of its appropriation to the University of Texas
at El Paso. A line item appropriation in the 2003 General Appropriations Act for the University of
Texas at El Paso listed $284,375 for the “Border Community Health Education Institute” for both
fiscal year 2004 and fiscal year 2005. See General Appropriations Act, Act of June 1,2003,78th
Leg., R.S., ch. 1330, art. 111.78, 2003 Tex. Gen. Laws 5023, 5339.
The BHI is required to provide an “annual audited financial statement and a status report of
each project undertaken” to each member of the governing board and to each member of the
legislature “whose district includes any portion of a county where the [BHI] is established or
operating.” TEX. EDUC. CODE ANN. § 15 1.008 (Vernon 2002). Moreover, the BHI governing board,
“in consultation with the institute’s members,” is required to develop a ten-year strategic plan “to
guide and evaluate the institute’s progress toward achieving the purposes of the institute under
Section 15 1.002.” Id. § 15 1.Ol O(a). Each even-numbered year, not later than December 15, the BHI
governing board must submit to the legislature and to the Texas Higher Education Coordinating
Board “a report concerning the strategic plan including any recommendation for legislative
action.” Id. 5 15 1.Ol O(d). Those institutions that are subject to the oversight and rules of the Texas
Higher Education Coordinating Board under chapter 61 of the Education Code “remain subject to
that supervision and those rules as those institutions participate in the institute and its activities.”
Id. 8 15 1.009. The member institutions subject to Coordinating Board oversight are the University
of Texas at El Paso, Texas Tech University Health Sciences Center at El Paso, the University of
Texas Health Science Center at Houston, School of Public Health, and the El Paso Community
College District. See id. 55 61.003, .051.
II. Status of the BHI: State Agencv or Political Subdivision?
The BHI is one of a number of entities that combine both state and local characteristics. See,
e.g., Tex. Att’y Gen. Op. No. JM-424 (1986) at 2 (community centers); Tex. Att’y Gen. LO-95-024,
at 4 (Coastal Coordination Council). Its nine original statutorily-proscribed member institutions
included seven public agencies and two private entities. Its present composition includes six public
and two private members. The BHI is created by statute and its duties prescribed thereby. It may
receive appropriated as well as federal funds. It is required to submit reports to the legislature
and to the Higher Education Coordinating Board in even-numbered years. It appears to be a
governmental body for all purposes.
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The more difficult question is whether the BHI is a state or local governmental entity. In
Guaranty Petroleum Corporation v. Armstrong, 609 S.W.2d 529 (Tex. 1980), the Supreme Court
of Texas considered whether a navigation district constituted a “political subdivision” or a “board
or agency of the state.” The court declared:
A political subdivision differs from a department[,] board or
agency of the State. A political subdivision has jurisdiction over a
portion of the State; a department, board or agency of the State
exercises its jurisdiction throughout the State. Members of the
governing body of apolitical subdivision are elected in local elections
or are appointed by locally elected officials; those who govern
departments, boards or agencies of the State are elected in statewide
elections or are appointed by State officials. Political subdivisions
have the power to assess and collect taxes; departments, boards and
agencies do not have that power. Our examination of a number of
statutes shows that the legislature has consistently recognized these
distinctions between departments, boards or agencies on the one hand
and political subdivisions on the other.
Id. at 53 1. The court ultimately concluded that the Brownsville Navigation District was a “political
subdivision” rather than a “department, board or agency of the State.” Id. at 530.
In Lohec v. Galveston County Commissioner’s Court, 841 S.W.2d 361 (Tex. 1992), the
Supreme Court of Texas, in considering the status of the Galveston County Beach Park Board, cited
the Guaranty Petroleum case and emphasized that “[clounty beach park boards lack state-wide
jurisdiction, a trait required of entities recognized as departments, boards, or agencies of the state.”
Id. at 364. Moreover, “[tlhere is no indication that county beach park boards are encompassed by
[the state purchasing statute’s] definition of a ‘state agency’ as one ‘in the executive branch of state
government.“’ Id. Thus, the court concluded that the beach park board was an entity of county
government. See id. at 365-66. As the dissenting opinion points out, however, the majority seems
to have relied most heavily for its conclusion on the observation that, if county beach park boards
are not deemed to be an organ of county government, they would be “independent and autonomous
entities which are exempt from any meaninghI oversight.” Id. at 366.
Finally, in a very recent case, the Supreme Court reiterated the test for determining whether
an entity is a “state agency.” In Texas Department of Transportation Y. City of Sunset Valley, No.
03-0041,200$ WL 2125670, at *4 (Tex. Sept. 24,2004) (not yet reported), the Court, in considering
an argument that a municipality was a “state agency,” stated as follows:
[W]e have long recognized a distinction between agencies of the
State, which generally exercise statewide jurisdiction, and political
subdivisions like municipalities, which have limited geographic
jurisdiction. SeeMonsanto Co. Y. Cornerstonesbfun. Util. Dist., 865
S.W.2d 937, 939-40 (Tex. 1993) (“[A] political subdivision differs
from a[n] . . agency of the State. A political subdivision has
jurisdiction over a portion of the State; a[n] agency of the State
The Honorable Jose R. Rodriguez - Page 6 (GA-0280)
exercises its jurisdiction throughout the State. [T]he legislature
has consistently recognized these distinctions between agencies
on the one hand and political subdivisions on the other.“).
The difficulty in applying the Guaranty Petroleum, Lohec, and Sunset Valley standards
becomes apparent when considering the status of the BHI. The BHI has much more tenuous ties
with local government than does a navigation district or a county beach park board. A majority of
its members represent institutions ofhigher education located in places as geographically diverse as
El Paso, Lubbock, and Houston. The purpose of the BHI is, inter alia, to deliver health care, provide
health education, and to assist the activities of various health-related institutions “working in the
Texas-Mexico border region,” a region that stretches from El Paso to Brownsville. Finally, the BHI
is required to submit biemial reports to the legislature and to the Higher Education Coordinating
Board. On the other hand, under the jurisdictional test of Guaranty Petroleum and Lohec, the BHI
clearly fails to qualify as a state agency within the executive branch of state government. Its
jurisdiction is limited to “aportion ofthe state” rather than to the state as a whole. Furthermore, its
membership bears the indicia of neither state agency nor political subdivision: members are not
elected or appointed either by local officials or state officials. BHI membership was initially fixed
by its enabling legislation. It is at present determined by the board members themselves. We must
conclude that, in its present composition, the BHI is neither political subdivision nor state agency.
Rather, it occupies that nebulous territory between those two extremes, partaking of the qualities of
both, but never fully either.
III. Ouestions and Analvsis
Although we cannot determine the precise status of the BHI for all purposes, we can discern
the applicability of particular statutes to that entity.
A. Sovereign Immunity
You first ask whether the BHI is entitled to sovereign immunity. As we have
indicated, the BHI is neither political subdivision or state agency. While the entitlement to sovereign
immunity ofboth state and local governmental entities is well established in Texas law, no judicial
decision has considered its applicability to hybrid entities such as the BHI. We will, consequently,
briefly review the law regarding sovereign immunity as applied to both state and local entities. We
caution, however, that we cannot determine as a matter of law whether the BHI is entitled to any
kind of sovereign immunity. The legislature has simply failed to provide any guidance in this matter.
The following discussion is therefore predicated on the assumption that the general principle of
sovereign immunity is applicable to the BHI.
Initially, we note that the Supreme Court of Texas has distinguished between immunity from
suit and immunity from liability. See Fed. Sign v. Tex. S. Univ., 951 S.W.2d 401,405 (Tex. 1997).
“Zmmunityfrom suit bars a suit against the State unless the State expressly gives its consent to the
suit,” while “[i]mmunityfrom liability protects the State from judgments even ifthe Legislature has
expressly given consent to the suit.” Id.
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With regard to tort liability, the legislature has partially waived sovereign immunity for both
the state and its political subdivisions. The Texas Tort Claims Act, chapter 101 of the Civil Practice
and Remedies Code, broadly defines “governmental unit” to include “any other institution, agency,
or organ of government the status and authorityofwhich are derived from the Constitution ofTexas
or fkom laws passed by the legislature under the constitution.” TEX. CIV. PRAC. &REM. CODE ANN.
5 101,001(3)(D) (Vernon Supp. 2004-05). TheBHI, as acreature ofstatute, is thus a“govemmenta1
unit” for purposes of the Tort Claims Act.
Section 10 1.025 of the Civil Practice and Remedies Code provides:
(a) Sovereign immunity to suit is waived and abolished to the extent
of liability created by this chapter.
(b) A person having a claim under this chapter may sue a
governmental unit for damages allowed by this chapter.
Id. 9 101.025 (Vernon 1997). Liability ofthe state government under the Tort Claims Act “is limited
to money damages in a maximum amount of $250,000 for each person and $500,000 for each single
occurrence for bodily injury or death and $100,000 for each single occurrence for injury to or
destruction of property.” Id. 5 101.023(a) (Vernon Supp. 2004-05). A unit of local government’s
liability “is limited to money damages in a maximum amount of $100,000 for each person and
$300,000 for each single occurrence for bodily injury or death and $100,000 for each single
occurrence for injury to or destruction ofproperty.” Id. 5 101.023(b). Because we have determined
that the BHI is neither a state governmental agency nor a local governmental entity, but rather a
hybrid ofthe two, we cannot say with assurance which tort liability limitation would apply. We may
conclude, however, that the BHI is entitled to sovereign immunity in tort cases, except to the extent
such immunity is waived by statute.
With regard to contractual liability, the Texas Supreme Court said in Federal Sign that when
it contracts with private citizens, the State “waives only immunity from liability.” Fed. Sign, 95 1
S.W.2d at 408. On the other hand, “a private citizen must have legislative consent to sue the State
on a breach of contract claim. The act ofcontracting does not waive the State’s immunityfrom suit.”
Id. As to local governmental entities, “[t]he general authority of counties and other local
governments to sue and be sued generally acts as a statutory consent to suit although not a waiver
of sovereign immunity.” 35 DAVID BROOKS, COUNTY AND SPECIAL DISTRICT LAW 5 2.2 n.5 (2d
ed. 2002) (statutes and cases cited therein).
The BHI is not, as we have indicated, either a state or local governmental entity. Federal
Sign could be read, however, to imply that no governmental entity is immune from liability on a
valid contract. We may also infer from that case that the BHI retains immunity from suit unless and
until permission to sue is granted by the legislature. As previously noted, most local governmental
entities have the statutory authority to sue and be sued. No such authority is granted to the BHI in
its enabling legislation. In our view, therefore, the legislature has not waived the BHI’s immunity
from suit for breach of contract. Accordingly, a party aggrieved by its contract with the BHI must
seek legislative permission to sue that entity.
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B. The Open Meetings Act
You next ask whether the BHI is subject to the Texas Open Meetings Act (the
“OMA”). See Request Letter, supru note 1, at 1, 5-7; TEX. GOV’T CODE ANN. $5 551.001-,146
(Vernon 1994 & Supp. 2004-05) (Open Meetings Act). The OMA provides that “[elvery regular,
special, or called meeting of a governmental body shall be open to the public, except as provided by
this chapter.” TEX. GOV’T CODE ANN. 5 55 1.002 (Vernon 1994). “Governmental body” is defined
for purposes of the OMA as follows:
(A) aboard, commission, department, committee, or agency
within the executive or legislative branch of state government that is
directed by one or more elected or appointed officials;
(B) a county commissioners court in the state;
(C) a municipal governing body in the state;
(D) a deliberative body that has rulemaking or quasi-judicial
power and that is classified as a department, agency, or political
subdivision of a county or municipality;
(E) a school district board of trustees;
03 a county board of school trustees;
(G) a county board of education;
(H) the governing board of a special district created by law;
(I) a local workforce development board created under Section 2308.253;
(J) anonprotitcorporationthatiseligible toreceivefundsunderthefederal
community services block grant program and that is authorized by this state to serve
a geographic area of the state; and
(K) a nonprofit corporation organized under Chapter 67,
Water Code, that provides water supply or wastewater service, or
both, and is exempt from ad valorem taxation under Section 11.30,
Tax Code.
Id. 5 551.001(3) (Vernon Supp. 2004-05). We have already determined that the BHI is not an
“agency within the executive or legislative branch of state government,” and that it does not qualify
as any kind of local governmental body. In addition, it is not a nonprofit corporation under
subdivisions (J) and (K) of section 551.001(3). These conclusions do not mean, however, that the
BHI is exempt from the Open Meetings Act.
III Sierra Club v. Austin Transportation Study Policy Advisory Committee, 746 S.W.2d 298
(Tex. App.-Austin 1988, writ denied), the court of appeals considered the applicability ofthe OMA
The Honorable Jose R. Rodriguez - Page 9 (GA-0280)
to the AustinTransportation StudyPolicy Advisory Committee (“ATSPAC”), “aseventeen-member
body composed of state, county, regional, and municipal public officials.” Id. at 300. Although not
legislatively created, ATSPAC had been designated a “Metropolitan Planning Organization” under
federal law, and was an “official body designated by the governor.” Id. at 300-01. The ATSPAC
played “a vital role in deciding which highway projects are planned, built and funded in the Austin
urban area.” Id. The court concluded that although the ATSPAC was not a “special district” in the
usual sense, it functioned as such for purposes of the OMA. Id. at 301.
Like the ATSPAC, the BHI is primarily composed of representatives of public entities. In
addition, its enabling statute indicates that it performs governmental functions, particularly those of
providing health care and health education to persons living in the border region. The BHI, unlike
ATSPAC, was created by statute. Both receive appropriated and federal funds, even if indirectly.
As the court noted in Sierra Club, the language of the OMA “clearly reveals the Legislature’s
intention to give it broad coverage.” Id. at 300. It “broadly applies to any meeting by a quorum of
the members of a governmental body which meets to discuss any public business or policy, with
certain exceptions.” Id. (emphasis added). As a result, we believe that the BHI exhibits the kind of
qualities sufficient to bring it within the category of a “special district” for purposes of the OMA.
See TEX. GOV’T CODE ANN. $ 551,001(3)(H) (Vernon Supp. 2004-05); see also Sierra Club, 746
S.W.2d at 301. We conclude that chapter 551 ofthe Government Code, the Open Meetings Act, is
applicable to meetings of the governing board of the BHI.
C. The Public Information Act
Your next question is whether the BHI must comply with the Texas Public
Information Act. See Request Letter, supra note 1, at 7-8; TEX. GOV’TCODEANN. $4 551.001-,353
(Vernon 1994 & Supp. 2004-05) (Public Information Act). Section 552.002 of the Government
Code defines public information as “information that is collected, assembled, or maintained under
a law or ordinance or in connection with the transaction of official business by a governmental
body. . or. . for a governmental body and the governmental body owns the information or has a
right of access to it.” TEX. GOV’T CODE ANN. 5 552.002 (Vernon Supp. 2004-05). Section 552.003
defines governmental body, in part, as follows:
(viii) the governing board of a special district;
.
(xii) the part, section, or portion of an organization,
corporation, commission, committee, institution, or agency that
spends or that is supported by public funds;
Id. 8 552.003(1)(A)(viii), (xii). W e h ave already concluded that the BHI is a “special district” for
OMA purposes under the test of Sierra Club. We need not, however, extend the Sierra Club case
beyond its scope, because the BHI is “an organization. that spends or that is supported by public
funds.” We conclude that the BHI is a “governmental body” under the terms of chapter 552 of the
Government Code, and thus subject to the Public Information Act.
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D. State Procurement and Contracting Rules
You also ask whether the BHI “must follow state procurement and contracting rules.”
Request Letter, supra note 1, at 1, 8. Under the State Purchasing and General Services Act, a state
agency is defined as:
(A) a department, commission, board, office, or other agency
in the executive branch of state government created by the state
constitution or a state statute:
(C) a university system or an institution of higher education
as defined by Section 61.003, Education Code, except a public junior
college.
TEX. GOV’T CODE ANN. § 2151.002 (Vernon Supp. 2004-05). Chapter 2155 of the Government
Codes sets forth the state purchasing rules and procedures that a state agency must follow. See id.
$5 2155.001.,448 (Vernon 2000 & Supp. 2004-05). Because we have determined that the BHI is
not a state agency within the executive branch of government nor a university system or institution
of higher education, we conclude that the BHI is not required to follow state procurement and
contracting rules.
E. Civil Service
You further question whether the BHI must follow civil service rules. See Request
Letter, sup-a note 1, at 1,s. Civil service systems may be created under chapters 143 and 158 of the
Local Government Code for municipalities and counties. See TEX. LOC. GOV’TCODE ANN. chs. 143,
158 (Vernon 1999 & Supp. 2004-05). There is no such system for employees of state agencies or
educational entities. Because we have concluded that the BHI is neither a state agency nor a local
governmental entity, we are aware of no statute that would require the BHI to follow civil service
rules.
F. Nonprofit Corporation Status
You finally ask whether the BHI must obtain nonprofit corporation status in order to
solicit funding. See Request Letter, sup-a note 1, at 1, 8. The BHI is, as we have indicated, a
creature of statute. Unlike, for example, the Texas Guaranteed Student Loan Corporation, it is not
deemed a nonprofit corporation by its enabling legislation. See Tex. Att’y Gen. Op. No. MW-295
(1981). The BHI may, by statute, receive appropriated funds and federal funds, as well as funds from
any public or private entity. See TEX. EDUC. CODE ANN. 3 151.005(a)-(c) (Vernon 2002). Its
governing board or any member “may. solicit and accept pledges, gifts, and endowments from
private sources on the institute’s behalf.” Id. § 151.005(a). Because its funding is specifically
described by its enabling legislation, and its solicitation of f?mds is specifically permitted, the BHI
need not obtain nonprofit corporation status in order to solicit funding.
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SUMMARY
The Border Health Institute is neither a state agency
within the executive branch of state government nor a local
political subdivision. The BHI may or may not be entitled to
sovereign immunity. It must comply with the Open Meetings
Act and the Public Information Act. It is not required to follow
state procurement and contracting rules, nor is it subject to civil
service rules. The BHI need not obtain nonprofit corporation
status because it has statutory authority to solicit funding from
public and private sources.
Yours very truly,
&- G OTT
Attorney General of Texas
BARRY R. MCBEE
First Assistant Attorney General
DON R. WILLETT
Deputy Attorney General for Legal Counsel
NANCY S. FULLER
Chair, Opinion Committee
Rick Gilpin
Assistant Attorney General, Opinion Committee