Untitled Texas Attorney General Opinion ( 2000 )


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  •     OPFKE   OF THE   ATTORNEY   GENERAL.   STATE   OF TEXAS
    JOHN      CORNYN
    October 17.2000
    The Honorable Susan D. Reed                                   Opinion No. K-0294
    Criminal District Attorney, Bexar County
    300 Dolorosa, Fifth Floor                                     Re: Whether a city council may pay attorney’s
    San Antonio, Texas 782053030                                  fees incurred to defend certain of its members in
    prosecution for Open Meetings Act violations,
    and related questions (RQ-0228-JC)
    Dear Ms. Reed:
    You ask about the validity ofresolutions adopted by a city council authorizing payment from
    city funds ofcity council members’ attorney’s fees, where city council members indicted for alleged
    Open Meetings Act violations voted for the resolutions. A city council member is disqualified from
    voting on a resolution to pay his or her legal fees, or the legal fees of another city council member
    indicted on the same facts for the same offense. The resolutions were invalid. Even if they were
    valid, we believe that a governmental body may not decide to pay the legal expenses incurred by a
    public officer or employee in defending against a criminal prosecution until it knows the outcome
    of the prosecution,     A governmental body may not reimburse an individual whose guilt is
    established. If the city council were able to take valid action to pay the attorney’s fees of a city
    council member, the fees could be paid from the revenues of the city’s water system operated under
    chapter 402 of the Local Government Code.
    The criminal charges were brought against the city council members because a former city
    council member was allegedly denied access to the public portion of a city council meeting on
    November 23, 1999, which was called to discuss Elmendorf Police Department personnel in
    executive session.’ The mayor, four city council members, and the chief of police of the City of
    Elmendorf have been indicted for alleged violations of the Open Meetings Act at the November 23
    meeting.2 The Elmendorf City Council met on April 16,2000, to vote on a resolution authorizing
    the engagement and payment of counsel to represent the city council members in the prosecution.
    See Request Letter, note 2, at 2. Five city council members voted on the resolution. One of the
    council members had been appointed to replace a council member who resigned after his indictment
    on Open Meetings Act violations and another had received immunity from prosecution.        See 
    id. ‘See Brief
    from Michael S. Brenan, Ebnendorf City Attorney, to Elizabeth Robinson,         Chair, Opinion
    Committee at 1 (June 2, 2000) (on file with Opinion Committee) [hereinafter Brenan Brief].
    ‘See Letter from Honorable Susan D. Reed, Criminal District Attorney, Bern       County, to Honorable John
    Comyn, Texas Attorney General at 1-2 (May 2,200O) (on file with Opinion Committee)     [hereinafter Request Letter].
    The Honorable    Susan D. Reed - Page 2            (X-0294)
    These two city council members voted against the resolution, while the three city council members
    who were under indictment voted in favor of it. See 
    id. Because the
    April 16th resolution had been approved by the three city council members who
    would benefit from it, it was reconsidered at another city council meeting held on April 20,200O.
    At this meeting, the council approved three separate resolutions, each ofwhich authorized payment
    of the legal fees for one of the three indicted city council members. Each indicted city council
    member abstained from voting on the resolution that applied to him or her and the other two indicted
    city council members voted in favor of it. See 
    id. You ask
    the following questions about the city council’s action:
    1. Can a member of a city council that was indicted for Texas Open
    Meetings Act violations vote on resolutions to employ and pay legal
    counsel to represent other members of the city council that were
    indicted for the same violations and to which the voting member is
    alleged to be a party?
    2. May the governing body of a municipality authorize payment of
    attorney’s fees incurred in defending the mayor and certain city
    council members following their indictments for Open Meetings Act
    violations occurring during a meeting of the city council?
    3. Can revenues from a municipal water utility system be utilized to
    pay legal counsel for representation of the mayor and certain city
    council members on Open Meetings Act violations if the resolution
    authorizing payment specified that the monies were to be derived
    from the city budget (i.e. general fund)?
    
    Id. at 2.4.
    We consider the events of the meetings at which the city council members who had been
    indicted for violating the Open Meetings Act voted to pay attorney’s fees to defend against these
    charges. At the April 16 meeting, the resolution authorizing payment of the legal fees was adopted
    by the vote of three city council members who had been indicted. At the April 20 meeting, each
    indicted city council member abstained from voting on the resolution that applied to him or her, but
    voted on the resolution applicable to the other indicted city council members. See 
    id. at 2.
    In our opinion, the resolutions adopted at both meetings are invalid. This office has stated
    in numerous opinions that apolitical subdivision may pay an officer’s or employee’s legal expenses
    only if it makes the following determinations:   payment of the legal fees serves a public interest and
    not merely the defendant’s private interest, and the officer or employee committed the alleged action
    or omission forming the basis of the suit while acting in good faith within the scope of his or her
    The Honorable    Susan D. Reed - Page 3            (JC-0294)
    official duties. See Tex. Att’y Gen. Op. Nos. DM-488 (1998) at 2-3, JM-968 (1988) at 2-3, H-887
    (1976) at 3; Tex. Att’y Gen. LA-24 (1973) at 2-3. It is extremely doubtful that an indicted council
    member could address these questions disinterestedly when payment for his or her defense is at
    stake. Public policy in Texas bars a public official from casting a deciding vote in a matter
    concerning an issue in which he has a direct, personal interest. See Hager v. State ex rel. TeVault,
    446 S.W.2d 43,49 (Tex. Civ. App.-Beaumont      1969, writ ref d n.r.e.); Tex. Att’y Gen. Op. No. IM-
    824 (1987) at 8. See also Bradley v. State, 
    990 S.W.2d 245
    (Tex. 1999). An indicted city council
    member is disqualified from voting on payment of attorney’s fees for his or her defense.
    We moreover believe that the indicted city council members were disqualified from
    approving the payment of attorney’s fees for the other council members indicted for the same
    offense. We base our conclusion on State ex rel. La Crosse v. Averill, 
    110 S.W.2d 1173
    (Tex. Civ.
    App.-San Antonio 1937, writ refd), involving a quo warrant0 action to remove two city
    commissioners    who were under indictment.      The city commissioners argued that the removal
    procedure provided in the city charter must be exhausted before quo warranto could be brought. See
    
    Averill, 110 S.W.2d at 1175
    . The court noted that the city council consisted of the two city
    commissioners and the mayor, and under the city charter, these officials could be removed only by
    their own votes, after they had conducted their own trial. See 
    id. The court
    stated as follows:
    [T]he majority of the members of the commission are charged with
    the joint commission of a single offense            If under the charter
    provisions they be tried jointly, as they may be, they must pass
    directly upon their own joint guilt or innocence; if separately, then the
    mayor and one of the commissioners must pass upon the guilt or
    innocence of the other member for an offense in which it is alleged
    a majority jointly and equally participated, and for which it is alleged
    they each are equally and by the same facts guilty. The result is
    obvious: First, that from every consideration they will not prosecute
    or convict themselves or their coconspirator; and, second, their
    decisions in the matter would be void, since the Constitution, to say
    nothing of public policy, prohibits any judge from sitting “in any
    cases wherein he may be interested,“.
    
    Id. at 1175-76
    (citation omitted).
    The three city council members of the City of Elmendorfwere indicted for the same alleged
    violation of the Open Meetings Act arising out of the same events and they have similar, if not
    identical, personal interests in receiving an adequate defense against the charge. It would also be
    extremely difficult for any of the indicted council members to make a disinterested determination
    as to the other council members indicted for the same offense. On the basis of Averill, we believe
    a court would hold that the three indicted city council members are disqualified from voting on a
    resolution authorizing the payment from public funds of legal fees for him or herself or for any of
    the other two indicted council members. Accordingly, we conclude that the resolutions adopted on
    The Honorable    Susan D. Reed - Page 4            (X-0294)
    April 16 and April 20 approving     the payment of attorney’s fees for the city council members are
    inval
    id. Because the
    resolutions authorizing the payment ofcity council members’ attorney’s fees are
    invalid, we need not address your remaining questions. However, your second question raises an
    issue that warrants discussion: the city’s payment from public funds of officers’ and employees’
    attorney’s fees in criminal cases. This office has written numerous opinions on the payment of
    public servants’ legal expenses in civil cases brought against them individually. See, e.g., Tex. Att’y
    Gen. Op. Nos. JM-968 (1988) (school district may expend funds in defense of lawsuit alleging
    intentional tort); H-887 (1976) (general-law city may authorize expenditures for defense of city
    employees and officials sued for actions within scope of public duties). When questions about
    paying attorney’s fees in criminal cases have arisen, this office has in the past assumed that the
    standards applicable in civil lawsuits are equally relevant to criminal cases. See Tex. Att’y Gen. Op.
    No. DM-488 (1998) (appraisal district may reimburse chief appraiser for representation in criminal
    proceeding); Tex. Att’y Gen. LO-97-049 (overruled to extent inconsistent with DM-488) (school
    district may pay for legal representation of employee in a criminal proceeding); LO-89-012 (county
    may pay attorney’s fees incurred in connection with grand jury investigations                of county
    commissioners).    However, the payment from public funds to defend a public servant in a criminal
    prosecution raises issues not necessarily raised in the context of a civil suit. Our discussion will
    begin with a review of the opinions on payment of an officer’s or employee’s attorney fees in a civil
    case.
    In Texas Attorney General Letter Advisory No. 24 (1973), this office addressed             the
    predecessor of Local Government Code section 157.901, which provides in part:
    (a) A county official or employee sued by any entity, other
    than the county with which the official or employee serves, for an
    action arising from the performance of public duty is entitled to be
    represented by the district attorney ofthe district in which the county
    is located, the county attorney, or both.
    (b) If additional counsel is necessary or proper in the case of
    an official or employee provided legal counsel under Subsection (a)
    or if it reasonably appears that the act complained of may form the
    basis for the tiling of a criminal charge against the official or
    employee,      the official or employee is entitled to have the
    commissioners court of the county employ and pay private counsel.
    TEX. Lot.   GOVT. CODEANN. 5 157.901(a), (b) (Vernon 1999). This provision does not entitle
    county officers and employees to representation at public expense in criminal cases. See White v.
    Eastland County, 
    12 S.W.3d 97
    , 103 (Tex. App.-Eastland 1999, no pet), Tex. Att’y Gen. Op. No.
    The Honorable   Susan D. Reed - Page 5             (X-0294)
    JM-755 (1987) at 3-5 (construing predecessor to provision in Local Government             Code section
    157.901(b) on tiling a criminal charge against the official or employee).
    Letter Advisory No. 24 determined that using county funds to defend county officers and
    employees sued individually would not violate Texas Constitution article III, section 52, which
    prohibits grants of public money in aid of individuals.          See Tex. Att’y Gen. LA-24 (1973)
    (addressing the predecessor of Local Government Code section 157.901, adopted as Act of May 24,
    1973,63d Leg., R.S., ch. 644,1973 Tex. Gen. Laws 1765). It noted that “[plublic money cannot be
    spent to defend private interests,” but “suits may be only nominally against individuals when they
    are really designed to obstruct or control the legitimate performance of official duties.” Tex. Att’y
    Gen. LA-24 (1973) at 2; see also City Nat’1 Bank ofAustin v. Presidio County, 26 S.W. 775,777
    (Tex. Civ. App. 1894). Such litigation in fact does involve the interests ofthe county. See 
    Presidio, 26 S.W. at 775
    . Seegenerally Tex. Att’y Gen. Op. No. JM-755 (1987) at 5 (suits brought by private
    individuals against public servants for official acts may be merely vexatious). Letter Advisory No.
    24 cautioned that the county could not provide a defense if only the defendant officer’s or
    employee’s private interests were at stake, even though the suit was based on an action taken
    ostensibly in the performance of public duties. See Tex. Att’y Gen. LA-24 (1973) at 3-4. It
    concluded that representation of a county official or employee believed in good faith to have been
    acting within the proper scope ofhis authority “is not illegal even though such confidence may prove
    to have been misplaced.” 
    Id. at 3.
    Other attorney general opinions determined that political subdivisions, including counties,
    have common-law authority to pay the legal expenses of officers and employees in civil cases, where
    the interests of the political subdivision are at stake. See Tex. Att’y Gen. Op. Nos. H-887 (1976)
    (city); DM-488 (1998) (appraisal district); JM-968 (1988) (school district); M-726 (1970) (county).
    The governing body’s decision to pay for an officer’s or employee’s defense is governed by the
    standard articulated in Letter Advisory No. 24. See Tex. Att’y Gen. Op. Nos. JM-968 (1988) at 3
    (board of trustees may pay trustee’s legal expenses if it determines that the suit involves the interest
    of the school district and the officer’s “actions      were undertaken in good faith within the scope
    of an official duty”); H-887 (1976) at 3 (when city council believes in good faith that the city’s
    interests are at stake, even though an officer or employee is sued individually, the city may employ
    an attorney to defend the action).
    Opinions subsequent to Letter Advisory No. 24 have reiterated the importance of the
    governmental body’s good faith belief that a public servant acted within the proper scope of his or
    her authority and, more important, have stated that the disposition of the lawsuit is irrelevant to the
    question of paying attorney’s fees. See Tex. Att’y Gen. Op. Nos. JM-968 (1988) at 2-3 (school
    board may pay legal expenses of trustee sued for intentional tort if it makes the proper
    determinations   and need not conclude that the officer is blameless); MW-252 (1980) at 1 (the
    propriety of defending an action against a public officer or employee “‘is not made dependent upon
    the outcome of the litigation, but upon the bona fides of the governing body’s motive”‘) (quoting
    Tex. Att’y Gen. Op. No. H-70 (1973) at 5). See also Tex. Att’y Gen. Op. No. DM-488 (1998) at 6.
    The statute at issue in Letter Advisory No. 24 authorized the county to provide an attorney for a
    The Honorable    Susan D. Reed - Page 6           (X-0294)
    county officer or employee soon after the lawsuit was filed, so that this statement was reasonable
    in the context of that opinion and in any other case where the decision to represent was made soon
    after the lawsuit was filed. See Tex. Att’y Gen. Op. No. DM-107 (1992) at 3 ‘(overruled to extent
    inconsistent withDM-488); Tex. Att’y Gen. LO-90-93, at 2-3 (overruled to extent inconsistent with
    DM-488). For several years, this office took the position that reimbursement was not permissible
    and that the governmental body’s decision must be made early in the litigation. Attorney General
    Opinion No. DM-488 (1998) finally made it clear that a political subdivision could reimburse an
    officer or employee for legal expenses incurred in a suit challenging actions taken within the scope
    ofhis or her official authority. See Tex. Att’y Gen. Op. No. DM-488 (1998) at 3, overruling input,
    Tex. Att’y Gen. Op. No. DM-107 (1992); Tex. Att’y Gen. LO-97-065, LO-97-049, and LO-90-93.
    The major issue in Attorney General Opinion DM-488 was whether an appraisal district was
    permitted to reimburse the chief appraiser for legal expenses after thejudicial proceedings were over.
    No emphasis was given to the fact that the appraiser had been a defendant in a criminal prosecution.
    The fact that the chief appraiser prevailed in the action was said to be irrelevant to the appraisal
    board’s decision to reimburse. See Tex. Att’y Gen. Op. No. DM-488 (1998) at 6. See also Tex.
    Att’y Gen. LO-89-12, at 3 (approving payment of county judge’s and county commissioners’
    attorney’s fees incurred in connection with grand jury investigation); Tex. Att’y Gen. Op. No. MW-
    252 (1989) (addressing payment of attorney’s fees for public officer who lost civil suit).
    However, we believe the outcome is particularly important when a public official faces
    criminal charges brought by the state, rather than a civil suit brought by a private individual. See
    generally white v. Eastland 
    County, 12 S.W.3d at 104
    (more safeguards against criminal actions
    being tiled than civil lawsuits). This view is consistent with most of the Texas authorities on
    payment from public funds of a public servant’s legal fees in a criminal prosecution, as well as
    authorities from other states. Cf: City of Corsicana v. Babb, 
    290 S.W. 736
    (Tex. Comm’n App.
    1927, judgm’t adopted) (authority of city to employ an attorney to defend policemen indicted for
    killing an individual in attempt to arrest him).
    Two cases involving the actions of the Del Rio city commission in issuing bonds and
    warrants found it unlawful for city commission members to approve payment oftheirown attorney’s
    fees to defend against prosecutions for offenses charged in either their private or official capacity.
    See City ofDelRio Y.Lowe, 
    111 S.W.2d 1208
    , 1219 (Tex. Civ. App.SanAntonio             1937), rev’don
    other grounds, 
    122 S.W.2d 191
    (Tex. 1938) State ex rel. La Crone v. Averill, 
    110 S.W.2d 1173
    (Tex. Civ. App.-San Antonio 1937, writ refd). The court of civil appeals decision in Lowe found
    that there was no public purpose in the city’s paying legal fees for the city commissioners and that
    the city commissioners also had a conflict in approving payment of their own attorney’s fees. See
    
    Lowe, 111 S.W.2d at 1218-19
    ; see also white v. Eastland 
    County, 12 S.W.3d at 103
    (discussing
    Lowe and AverdO.
    While the conclusion in Lowe that no public purpose was served by the city’s paying the city
    commissioners’ legal fees has not been overruled, we believe the strict prohibition against using
    public funds to defend public officers in criminal prosecutions would not be followed today. The
    The Honorable   Susan D. Reed - Page 7            (X-0294)
    court in Crider v. Cox, 
    960 S.W.2d 703
    (Tex. App.-Tyler 1997, pet. denied), addressed the county’s
    attempt to pay an attorney for representing the county judge in misdemeanor charges of attempting
    to secure dismissal of traffic tickets in cases before his court. Upon trial of the charges, the county
    court-at-law decided in the county judge’s favor by quashing the indictment. See Crider, 960
    S.W.2d. at 704. The attorney submitted his hill, which the commissioners court approved without
    the county auditor’s approval.       See 
    id. The attorney
    tiled a mandamus proceeding against the
    auditor to compel her to audit and approve the bill and issue and sign a county check in payment of
    his claim. See 
    id. The application
    for the writ of mandamus was denied because the auditor’s approval of the
    claim was a discretionary act. See 
    id. at 707.
    In deciding whether to approve the bill, “the Auditor
    was required to resolve several daunting questions,” including the following:
    (1) Was [the County judge’s] conduct leading to the criminal
    charges undertaken in the performance of [his] public duties as
    County judge?
    (3) [Was] the County obligated to pay for legal services when
    there was no agreement or contract between the county and the
    claimant before the services were rendered?
    
    Id. The court
    noted that the attorney offered no rationale to explain the county’s interest in the
    dismissal of the traffic tickets and that a legal opinion received by the auditor from the criminal
    district attorney had found that county funds could not be expended on the countyjudge’s legal fees.
    See 
    id. n. 4.
    Crider suggests that the conduct giving rise to the criminal prosecution must be closely
    scrutinized.
    In white v. Eastlund County, the county sheriff sued the county for payment of his costs in
    defending against criminal charges for removing a private fence blocking a county road, acting at
    the direction of the commissioners court and with the assistance of a county commissioner.      The
    court determined that the county had no duty to defend the sheriff and stated as follows:
    In other jurisdictions,  both statutory and common law generally
    authorize reimbursement      only if the underlying suit or criminal
    charge arose out of the good faith discharge of an official duty in
    which the government or public had an interest and if the official
    prevailed in that suit. Many state courts, like Texas, have found that
    there is a discretionary power to reimburse officials for their legal
    fees, but others have found a duty of reimbursement         where the
    official was successful.
    The Honorable   Susan D. Reed - Page 8            (JC-0294)
    The policy issues are best considered by our legislature. The
    Texas legislature has addressed the problem of tiivolous lawsuits
    against county employees and their cost of counsel in Section
    157.901 [of the Local Government Code]. Although there may be
    more safeguards against criminal actions being tiled than civil
    lawsuits, the legislature may wish to consider when or if county
    officials and employees should be entitled to reimbursement for legal
    fees spent in defending against criminal charges arising out of actions
    clearly done in the scope of their 
    duties. 12 S.W.3d at 104
    (citation omitted).
    The legislature has in fact authorized the state under certain circumstances to pay the
    attorney’s fees incurred by state officers and employees in defending a criminal prosecution. This
    statute is included in chapter 104 of the Civil Practices and Remedies Code, which provides for
    indemnifying state officers and employees for damages and other costs adjudged against them in a
    lawsuit based on conduct in the scope of their employment. See TEX. CIV. PRAC.&REM. CODEANN.
    $5 104.001, ,002 (Vernon 1997). Section 104.0035 ofthe code provides for indemnifying a state
    officer or employee for reasonable attorney’s fees incurred in defending a criminal prosecution if
    “the attorney general determines that the conduct for which the person is criminally prosecuted could
    give rise to a civil cause of action covered by Section 104.002 [providing for indemnification in civil
    suits].” 
    Id. 5 104.0035(a)(2).
    There are additional conditions. The person must be found not guilty
    after a trial or appeal, or the complaint, information, or indictment must be dismissed without a plea
    of guilty or nolo contendere being entered and it must have been dismissed because it was based on
    mistake, false information, or a similar error. See 
    id. 5 104.0035(a)(3),
    (4). Thus, section 104.0035
    is directed at indemnifying only the innocent public servant for attorney’s fees incurred in defending
    a criminal action.
    Because no legislation applicable to political subdivisions governs the payment of attorney’s
    fees in criminal cases, we must answer your second question on the basis of the policy reflected in
    analogous statutes, the cases cited in this opinion, and the law of other states. See generally
    Kimberly K. Winbush, Annotation, Payment of Attorneys’ Services in Defending Action Brought
    Against OfficialsZndividuallyas    Within Power or Obligation ofPublicBody,47      A.L.R. 5th 553,599
    (1997) (legal fees of public officials may be paid from public funds only if the official successfully
    defends criminal charges arising from his or her official responsibilities).   We find a Florida case
    helpful in defining the public interest that might be served by spending public funds to defend
    members of a governmental body against prosecution for Open Meetings Act violations. See Askew
    v. Green, Simmons, Green and Hightower, P.A., 
    348 So. 2d 1245
    (Fla. Dist. Ct. App. 1977), cert.
    denied, 
    366 So. 2d 879
    (Fla. 1978). Askew addressed the validity of acounty ordinance authorizing
    the payment of public funds for a county commissioner’s successful defense of prosecution for
    violation of the “open public meetings law.” 
    Id. at 1246-47.
    The ordinance benetitted only those
    commissioners whose alleged offense was conducting public business in private, and who were not
    found guilty. See 
    id. It did
    not purport to authorize payment for legal expenses of commissioners
    The Honorable    Susan D. Reed - Page 9            (X-0294)
    charged with “bribery, acceptance ofunauthorized    compensation, or other general criminal statutes.”
    
    Id. The court
    found that the expenditure served a public purpose, not the private interest of the
    individual county commissioners, stating that:
    there is no public interest in defending guilty officials from
    prosecution. But it does not follow, absent general law declaring it,
    that the legislative body of a county is incompetent to relieve
    innocent officials, prosecuted      as officials for conduct while
    discussing or taking action on county business, from the financial
    burden of unjustified prosecutions.
    
    Id. at 1248.
    Thus, the county could reasonably find that there was a public purpose in expending
    public funds to pay “certain costs ofunjustitied criminal prosecutions ofcounty officers” for alleged
    violations of the public meetings act. 
    Id. Both the
    Florida case and Texas Civil Practices and Remedies Code section 104.0035 require
    the officials to be innocent of the charges as a condition to payment of the attorney’s fees from
    public funds. We believe that a Texas court would find that a city governing body is authorized, but
    not required, to reimburse a member of the city council for attorney’s fees incurred in defending
    against criminal charges under the Gpen Meetings Act, that the act must have been done in the bona
    tide performance of official duties and that a public interest, rather than a private interest of the
    individual officer, is served by the expenditure. See generally Tex. Att’y Gen. Op. No. JM-824
    (1987) at 2 (lawfulness of spending public funds to protect public interest in suit against a public
    official or employee is a question of fact). Most important, we believe a Texas court would hold,
    like the Florida court in Askew, that there is no public interest in defending a guilty official from
    prosecution.
    The city may not pay the expenses of an official who is found guilty ofthe charges and must
    therefore defer its decision to pay the legal expenses until after disposition of the charges. Attorney
    General Opinion DM-488 is overruled as to its statement that the outcome ofthe criminal case is not
    relevant to the appraisal board’s decision to reimburse the chief appraiser for his attorney’s fees in
    defending against a criminal charge.
    You finally ask whetherrevenues    from themunicipal waterutility system maybe used to pay
    the attorney’s fees of the mayor and city council members if the resolution authorizing payment
    specified that the monies were to be derived from the city budget, i.e., the general fund. See Request
    Letter, supra note 2, at 1,4. The resolutions adopted by the city council called for the city’s budget
    to be amended for the “stated purpose.” 
    Id. at 4.
    After the meeting, it was apparently determined
    that there were insufficient funds in the general fund to pay the approved legal fees, and the mayor
    ordered the city secretary to pay the attorney’s fees from the water system fund. See 
    id. Because we
    concluded that the city council resolutions authorizing payment ofthe attorney’s fees are invalid,
    The Honorable   Susan D. Reed - Page 10           (JC-0294)
    your third question is hypothetical. We will, however, address the use of city water revenues to pay
    attorney’s fees where such fees have been validly authorized.
    The City ofElmendorfowns       and operates its own water department as authorized by chapter
    402 of the Local Government Code. See Brenan Brief, supra note 1, at 3. The revenues of the
    department are not encumbered by bonds or impact fees. See 
    id. Section 402.001(b)
    of the Local
    Government Code provides that “[a] municipality may purchase, construct, or operate a utility
    system inside or outside the municipal boundaries and may regulate the system in a manner that
    protects the interests of the municipality.” See TEX. LOC. GOV’TANN. 5 402.001(b) (Vernon 1999);
    see also 
    id. § 402.001(a)
    (defining utility system to mean a “water, sewer, gas, or electricity
    system”). According to the plain meaning of section 402.001(b) of the Local Government Code, a
    city may regulate a utility system to protect the interest of the city. See TEX. GOV’T CODEANN.
    5 311.01 l(a) (Vernon 1998) (stating that words of statutes are to be read in context and construed
    according to the rules of grammar and common usage). A city may collect sewer charge revenues
    that render a profit to the city and may place them in the general revenue fund to use for public
    purposes. See Bexar County Y. City of San Antonio, 
    352 S.W.2d 905
    , 908 (Tex. Civ. App.-San
    Antonio 1961, writ dism’d); see also City of Texarkana v. Wiggins, 
    246 S.W.2d 622
    (Tex. 1952)
    (city operated water system at a profit). The water system revenues of City of Elmendorf are
    handled in the same way. The city’s attorney informs us that “[tlhe Elmendorf water system is
    proprietary in nature, and provides the bulk of the revenues for operation of the city government.”
    Brenan Brief, supra note 1, at 3. Accordingly, we find no statutory prohibition against placing water
    system revenues in the city’s general fund to be used for public purposes. The city’s budget must
    in fact show “the funds received from all sources during the preceding year,” and the “funds
    available from all sources during the ensuing year.” TEX. LOC.GOV’TCODEANN. § 102.003(b)(3),
    (4) (Vernon 1999). If the city council were to take valid action to pay the attorney’s fees of a city
    council member, the fees could be paid from water system revenues.
    The Honorable   Susan D. Reed - Page       11      (JC-0294)
    SUMMARY
    A city council member is disqualified from voting on a
    resolution to pay his or her own legal fees or the legal fees of another
    city council member indicted on the same facts for the same offense.
    Although it is not required to do so, a city council may spend
    public funds to reimburse a city council member for the legal
    expenses of defending against an unjustified prosecution for Open
    Meetings Act violations.     It may not decide to pay for such legal
    expenses until it knows the outcome ofthe criminal prosecution. The
    city may not pay the expenses of a city council member who is found
    guilty of such violations.
    If the city council were able to take valid action to pay the
    attorney’s fees of a city council member, the fees could be paid from
    the revenues of the city’s water system revenues operated under
    chapter 402 of the Local Government Code.
    Attorney General Opinion No. DM-488 (1998) is overruled
    with respect to its statement that the disposition of charges in a
    criminal case against a chief appraiser is not relevant to the appraisal
    board’s decision to reimburse him for his legal fees in defending
    against the charges.
    ANDY TAYLOR
    First Assistant Attorney General
    CLARK KENT ERVIN
    Deputy Attorney General - General Counsel
    SUSAN D. GUSKY
    Chair, Opinion Committee
    Susan L. Garrison
    Assistant Attorney General - Opinion Committee