Untitled Texas Attorney General Opinion ( 1948 )

435 THEA``OHNEYGENEEZAL OIFTEXAS Hon. D. D. Williams Opinion No. V-684 County Attorney Throckmorton County Re: Authority of Commis- Throckmorton, Texas slonerst Court to transfer Road Bond interest and sinking fund and rental re- ceived for use of trucks to Road and Bridge Fund. Dear Sir: We refer tc your letter in which you submit the following: "1. Throckmorton County voted certain road bonds and sold certain road bonds and part of this money was used for the purchase of right df way, building roads, etc., and there remains from the sale of such road bonds approximately $10.000 in the road bond fund account. The State has assumed the pay- ment of the road bonds in Throckmorton Coun- ty and there will be no more highways built by the State Highway Department so far as we know and there is no need for this partlcu- lar money for State Highway purposes at this time, nor do we contemplate any need for such money In the future. "We adohave a great need for this money on lateral county roads and we would appre- ciate your advice as to whether or not this money can be used on the County roads. And in this connection, I understand that the Attorney GeneSal Department furnished an opinion to the Commissioners' Court of Has- kell County or the County Attorney of Has- kell County; involving a situation exactly the same as ours and I would appreciate a copy of this opinion. 436 Hon. D. D. Williams, page 2 (V-684) "2. Throckmorton County has set up an Interest and sinking fund to pay the princi- pal and interestwhen due on two issues of road bonds. The State has assumed the pay- ment of these bonds and the interest when the same becomes due and we have a surulus of ao- proximately $9.000.00 In the road bond i&e;- est and sinking fund for which there is no need at the present time, nor will there be a need in the future as the State has assum- ed the payment of these bonds and the lnter- est on same. "We would appreciate an opinion from you in view of the above circumstances as to wheth- er or not this money in the road bond interest and sinking fund can be,,usedon lateral roads in Tbrockmorton County. (Emphasis added) The money referred to in your letter was de- rived from two sources, viz: (1) Unused proceeds of coun- tyroad bonds voted for the purpose of construction and maintenance of macadamized, graveled, and paved roads and turnpikes, or in aid thereof, in Throckmorton Coun- ty, $lO,OOO.OO; (2) Unused road bond interest and,sink- ing fund raised by taxation to pay said bonds and the interestthereon, $9,000.00., In final analysis you ask if said sums of money may be used to build county roads in Throckmorton county. Your questions are answered in the order as above. (1) The sum of $lO,OOO.OO is the unused por- tion of the proceeds of a bond issue voted and sold by Throckmorton County for the purpose of constructing, maintaining and oueratlna macadamized. graveled-or uav- ed roads and turnpikes. or in aid thereof, in Throok- morton County. All of the election proceedings specifi- cally earmark the proceeds of the said bonds as follows: "On roads from the North base line of said Tbrockmorton County through Throckmorton to the South Base line of said Throckmorton County, and from the East base line of said Throckmorton County through Albert and lnter- sectlng the said proposed road from the North 'base line of said Throckmorton County to the South base line of said Throckmorton County Hon. D. D. Williams, page 3 (V-684) 437 and from the North base line of Stephens County through Woodson and intersecting the said proposed road from the North base line to the South base line of said Throck- morton County." NothIngcontained in any of such election pro- ceedings enlarges the purpose of the bond issue as above recited to authorize the use of any of the .proceedsof said bonds for any other purpose. In Opinion No. O-7213 by a former admlnistra- tion, a copy of which Is enclosed, it was held that an unused portion of a bond issue made under authority of Sectioff52 of Article III of the Constitution, not 'ear- marked for specified roads, may be used to purchase right-of-way for farm-to-market roads. It is there held: "It appears from the proceedings that no reference was made 'earmarking' the money for a particular road or a particular type of construction. We are furnished with no facts or orders showing that the proceeds of said bonds were 'earmarked'. "Based on the transcript of proceedings that we have before us, It Is our opinion that the Comm?ssl.onerslCourt of Haskell C.ountymay sell the Series D issue of bonds and use the funds for the purpose of aiding In the construction of and purchasing right- of-;ay for farm-to-market roads in said Coun- ty. T$e above o@nlon further states that if the funds were earmarked for a particular road or a partl- cular tqpe of construction 'a different conclusion would result. In your case the records reflect that the bonds were voted for particular roads; therefore, in view of the foregoing it is our opinion that the unused portion of the proceeds of such bond issue may not be used for county roads other than those for which the bonds were voted. If the bond purpose has been completed, then the $lO,OOO.OO left over should be used to retire out- standing bonds. If the owner or owners of such bonds are unknown to the county, then the money should be plao- ed In the sinking fund. 438 Hon. D. D. Williams, page 4 (V-684) ,,,,,,*,I- ,._ ,~. 1 ! (2) The sum of approximately $g,OOO.OO in the road"'bo'nd interest and sinking fund was obtained by a tax which was levied and collected to pay interest and create a sinking fund to pay road bonds voted and sold as auth- orized by Section 52 of Article III of the Constitution. The bonds have not been paid and Throckmorton County is primarily liable for their payment, which liability con- tinues until such bonds are paid in full. In Opinion No. V-157 of this office it was held that money In a sinking fund may be used only to pay the principal and Interest on the obligation for which said fund was created, until such obligations are fully paid. It is there further held that after all such obligations are paid, any surplus then remaining in such fund may be disposed of in accordance with the provisions of Article 752a, V. C. S., as amended. We enclose a copy of that opinion. SUNNARY The portion of the proceeds of a bond issue voted and sold under the provisions of Constitution Art. III, Section 52, and earmarked for particular roads, may not be used for the construction,of county roads other than those for which the bonds were voted. Money In the Road Bond Interest and Sinking Fund for the payment of road bonds may not be used for any purpose other,than the payment of such bonds and the interest thereon before such bonds are paid in full. After such payment such money may be used for the purposes specified in Art. 752a, v. c. s. Yours very truly, APPROVED: ATTORNEY GENERAL OF TEXAS c2$.-&& By m7-wdLib FIRST ASSISTANT da+ ATTORNEY GENERAL W. T. Williams Assistant . WTW:wb:mw