Untitled Texas Attorney General Opinion: KP-0466 ( 2024 )

May 28, 2024
The Honorable Glenn Hegar
Texas Comptroller of Public Accounts
Post Office Box 13528
Austin, Texas 78711-3528
Opinion No. KP-0466
Re: Application of conflict-of-interest rules to grants awarded by the Texas Opioid
Abatement Fund Council (RQ-0533-KP)
Dear Mr. Hegar:
You ask about the application of specific conflict-of-interest rules to grants awarded by the
Texas Opioid Abatement Fund Council (“Council”), and we limit our discussion to the provisions
you raise. 1 You explain that the Opioid Abatement Settlement Fund (“Fund”) originated from
settlement agreements related to litigation involving the manufacture and distribution of opioids.2
Request Letter at 1. You tell us the Council was created to “distribute funds to communities to
provide relief for those affected by the opioid crisis.” Id. You state the Council members come
from industries or professions with experience with opioid-related harms as well as from specific
regions of the State. Id. at 1–2. You explain that “[t]he Council is required to have members with
specific types of experience, who are affiliated with the same entities that would otherwise be
eligible for the grants.” Id. at 2. Noting the strict legal requirements related to conflicts of interest,
you state that “[i]f every qualified, otherwise eligible entity with any tie to a Council member
would lose the ability to remediate opioid harms because of the member’s service on the Council,
1
See Letter from Honorable Glenn Hegar, Tex. Comptroller of Pub. Accts., to Honorable Ken Paxton, Tex.
Att’y Gen. at 1 (Feb. 29, 2024), https://texasattorneygeneral.gov/sites/default/files/request-files/request/2024
/RQ0533KP.pdf (“Request Letter”). For instance, you do not expressly inquire about Penal Code section 36.08, nor
do you inquire about the Council’s Code of Ethics rule. See id. at 1–7. We presume you have considered these
provisions independently, so we do not address them here.
2
According to a webpage for the Council, the “state of Texas has participated in settlement agreements with
different companies to resolve legal claims against them for their role in the opioid crisis.”
https://comptroller.texas.gov/programs/opioid-council/settlements/.
Moneys received in connection with the various settlement agreements (collectively “settlement
agreements”) are distributed pursuant to these agreements and subchapter R, chapter 403, Government Code. See,
e.g., TEX. COMPTROLLER OF PUB. ACCTS., Teva Texas State-Wide Opioid Settlement and Consent Judgement (Exhibit
A, Opioid Abatement Fund (Texas) Settlement) at 2 (Feb. 4, 2022), https://comptroller.texas.gov/programs/opioid-
council/docs/teva-tx-state-wide-opioid-settlement.pdf (“Texas Term Sheet”).
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many of the current members could resign, and filling those positions could cause a significant
delay in saving lives.” Id.
The Council
The Texas Opioid Abatement Fund Council and Settlement Allocation Term Sheet (the
“Texas Term Sheet”) executed on May 13, 2020, by the State of Texas and its political
subdivisions, addressed the allocation of settlement proceeds for negotiated resolutions of claims
of the State of Texas and its political subdivisions against manufacturers, marketers, promoters,
distributers, and dispensers of opioids and opioid products. See supra note 2. In May of 2021, the
Texas Legislature passed Senate Bill 1827, codified at chapter 403 of the Texas Government Code,
subchapter R, to govern Statewide Opioid Settlement Agreements. See TEX. GOV’T CODE
§§ 403.501–.511. Subchapter R incorporated elements of the Texas Term Sheet and establishes
the Council to “ensure that money recovered by this state through a statewide opioid settlement
agreement is allocated fairly and spent to remediate the opioid crisis in this state by using efficient
and cost-effective methods that are directed to regions of this state experiencing opioid-related
harms.” Id. § 403.503(a). Subchapter R requires that the Council have thirteen appointed members
who represent various regions of the State experiencing opioid-related harm and various
professions and industries experienced dealing with opioid-related harm, along with the
Comptroller or his or her designee as a nonvoting presiding officer. See id. § 403.503(b) (providing
for composition and appointment structure of the Council). The Council is administratively
attached to the Office of the Texas Comptroller of Public Accounts (“Comptroller’s Office”),
which is to provide staff and facilities to the Council. Id. § 403.503(e).
As a general matter, subchapter R creates an Account and a Fund related to opioid
abatement settlements and provides for the allocation of the funds. See id. §§ 403.501(1) (defining
“Account”), (3) (defining “Fund”), 403.505 (providing for the Opioid Abatement Account),
403.506 (providing for the Opioid Abatement Trust Fund). The subchapter directs the deposit and
allocation of the opioid settlement agreement money in accordance with the subchapter, the
settlement agreements, and any applicable bankruptcy plan and specifies the respective duties of
the Council and the Texas Treasury Safekeeping Trust Company. 3 See id. § 403.507; see also id.
§§ 403.501(6) (defining “[t]rust company” to mean the Texas Treasury Safekeeping Trust
Company), 404.101–.116 (providing for the Texas Treasury Safekeeping Trust Company). Among
other things, the Council determines and approves the strategy for allocating the money under its
purview, develops a grant application and award process, and reviews grant agreements to ensure
recipients comply with the terms of such agreements. Id. § 403.509(a). The scenario about which
you are concerned is perhaps best exemplified with the example of hospital districts. Subchapter
R requires that two members of the Council be employees of a hospital district. See id.
§ 403.503(b)(3), (4). At the same time, subchapter R requires that 15% of the opioid abatement
money allocated to the Council be allocated to hospital districts. Id. § 403.508(a)(2). As a practical
matter, the number of hospital district employees willing to serve on the Council would be reduced
3
Subchapter R provides that “[o]f the money allocated to the council under Section 403.506(c)(2), the council
shall allocate: (1) one percent to the comptroller for the administration of the council and this subchapter; (2) 15
percent to hospital districts; and (3) the remaining money based on the opioid abatement strategy developed by the
council under Section 403.509.” TEX. GOV’T CODE § 403.508(a).
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if their serving on the Council disqualifies the hospital district from receiving any opioid abatement
funds.
Government Code section 572.058 applies to grants awarded by the Texas Opioid
Abatement Fund Council.
We begin with Government Code chapter 572, which establishes standards of conduct and
conflict-of-interest requirements for state officers and employees. See generally id. §§ 572.001–
.069. You specifically mention section 572.058, which provides that
[a]n elected or appointed officer, other than an officer subject to
impeachment under Article XV, Section 2, of the Texas
Constitution,4 who is a member of a board or commission having
policy direction over a state agency and who has a personal or
private interest in a measure, proposal, or decision pending before
the board or commission shall publicly disclose the fact to the board
or commission in a meeting called and held in compliance with
Chapter 551. The officer may not vote or otherwise participate in
the decision. The disclosure shall be entered in the minutes of the
meeting.
Id. § 572.058(a) (footnote added); see also id. § 572.058(b) (providing that an individual violating
this provision is subject to removal from office); Request Letter at 3. Subsection 572.058(f)
provides that the phrase “personal or private interest” has the same meaning as it has under Texas
Constitution, article III, section 22. 5 TEX. GOV’T CODE § 572.058(f); see TEX. CONST. art. III, § 22
(“A member who has a personal or private interest in any measure or bill, proposed, or pending
before the Legislature, shall disclose the fact to the House, of which he is a member, and shall not
vote thereon.”).
Under its plain text, the application of subsection 572.058(a) to a person depends on
whether the person is: (1) an elected or appointed officer; and (2) a member of a board or
commission with policy direction over a state agency. TEX. GOV’T CODE § 572.058(a). We parse
that language in turn. We first note that the Comptroller is an elected official subject to
impeachment under Texas Constitution article XV, section 2 and is thereby excluded from the
Article XV, section 2 lists the Governor, Lieutenant Governor, Attorney General, Commissioner of the
4
General Land Office, Comptroller, and certain judges. TEX. CONST. art. XV, § 2.
5
The courts have not determined the full scope of the phrase “personal or private interest.” See Tex. Att’y
Gen. Op. No. GA-0087 (2003) at 2; see also Tex. Ethics Comm’n Op. No. 298 (1996) (“The scope of this term has
not been clearly defined under either the constitutional provision or the Government Code section.”); but see Off. of
Pub. Util. Couns. v. Pub. Util. Comm’n, 185 S.W.3d 555, 573–74 n.28 (Tex. App.—Austin 2006, pet. denied)
(considering a previous employment relationship in the context of conflict-of-interest provisions, including section
572.058).
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application of subsection 572.058(a). 6 See supra note 4; TEX. GOV’T CODE § 572.058(a). So, we
consider the other members of the Council to determine whether they are “appointed officers”
under chapter 572.
In relevant part, subsection 572.002(1)(C) defines “[a]ppointed officer” to mean “an officer
of a state agency who is appointed for a term of office specified by the Texas Constitution or a
statute of this state[.]” TEX. GOV’T CODE § 572.002(1)(C). As previously noted, all voting
members of the Council are appointed to their positions. See id. § 403.503(b); see also id.
§ 403.503(b)(6) (providing that the Comptroller is a nonvoting member and serves as the presiding
officer). While chapter 403 does not provide for a term of office for Council members, the Texas
Constitution does by default. Article XVI, section 30 provides that the “duration of all offices not
fixed by this Constitution shall never exceed two years.” TEX. CONST. art. XVI, § 30(a).
Accordingly, a court would likely conclude that a voting member of the Council is an appointed
officer under subsection 572.058(a).
The application of subsection 572.058(a) also depends on whether the entity is a “board or
commission having policy direction over a state agency . . . .” TEX. GOV’T CODE § 572.058(a). So
we consider whether the Council satisfies all aspects of this language, addressing the state agency
aspect first. For its purposes, chapter 572 defines “[s]tate agency” to mean “a department,
commission, board, office, or other agency that: (i) is in the executive branch of state government;
(ii) has authority that is not limited to a geographical portion of the state; and (iii) was created by
the Texas Constitution or a statute of the state[.]” Id. § 572.002(10)(A). While the body you ask
about is called a council and not a board or commission, it is nonetheless the decision-making
body in relation to the allocation of certain opioid settlement funds. See id. § 403.509 (describing
the Council’s powers to include decision making authority with respect to allocation of certain
opioid settlement funds); see also NEW OXFORD AMERICAN DICTIONARY 394 (3d ed. 2010)
(defining “council” to mean “an advisory, deliberative, or legislative body of people formally
constituted and meeting regularly”). A court is likely to decide the question of subsection
572.058(a)’s application based on an entity’s function rather than solely on its name. Additionally,
the Council is administratively attached to the Comptroller’s Office in the executive branch. TEX.
GOV’T CODE § 403.503(e); see also Tex. Att’y Gen. Op. No. GA-0611 (2008) at 5 (noting a
particular committee’s “placement in the Government Code and its operation under the
Comptroller” likely makes it part of the executive branch of government). The Council’s authority
to allocate funds is not limited to a geographical portion of the state. See TEX. GOV’T CODE
§§ 403.508 (directing the Council to allocate a certain percentage of money to hospital districts
without regard to location), 403.509(b) (authorizing the Council to reallocate money between
geographic regions). The Council was created by Government Code chapter 403, a Texas statute.
6
Absent application of subsection 572.058(a), the Comptroller would be subject to the common-law rule
found in Meyers v. Walker. 276 S.W. 305, 307 (Tex. App.—Eastland 1925, no writ) (applying to a public official
directly or indirectly having a pecuniary interest in a contract); see infra at 5–6. Where one member of the
governmental body has a pecuniary interest in a contract, the common law precludes the governmental body from
making the contract. See Tex. Att’y Gen. Op. No. JC-0484 (2002) at 5, 6. In this instance, however, the Comptroller
would not have a pecuniary interest in an entity potentially receiving a grant from the Council and has no conflict-of-
interest under the common law. Thus, we need only consider the application of section 572.058 with respect to the
other, appointed members of the Council.
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See generally id. §§ 403.501–.511. Accordingly, a court would likely conclude that the Council
satisfies the definition of “state agency” for purposes of subsection 572.058(a). 7
We next consider whether the Council has policy direction. See id. § 572.058(a). Among
its other obligations under various settlement agreements, court orders, or the Texas Term Sheet,
the Council is charged with, for example, determining and approving opioid abatement strategies,
reviewing and approving grant applications, and allocating abatement settlement funds. Id.
§ 403.509; see also id. § 403.501 (defining “Council” with respect to its function of managing the
distribution of money allocated from the Fund). A court would likely conclude that such authority
constitutes policy direction with respect to the key purpose of the Council—the allocation of
certain opioid abatement Fund moneys. The Council is therefore likely considered a board or
commission having policy direction over the Opioid Abatement Fund. Accordingly, a court is
likely to conclude that the Council members are appointed officers and that they exercise policy
direction as members of a state agency for purposes of section 572.058.
Application of the common-law ethics rule from Meyers v. Walker
Yet, this office has long concluded that the application of section 572.058 is limited to an
agency’s primary functions of “rule making and the application of the statute and rules to
individual cases.” Tex. Att’y Gen. Op. No. JM-671 (1987) at 5 (discussing the predecessor statute
to section 572.058). Accordingly, contracts—presumably including those awarding grants—were
considered to fall outside the scope of this statutory conflict-of-interest provision. See id. 8 Instead,
this office determined that the governing law for conflicts of interest arising in the context of
contracts and other agreements is based on the Texas Court of Appeals decision of Meyers v.
Walker. See id. at 6–8. Meyers recites a strict rule prohibiting a public officer from having any
personal financial interest in a contract entered into by the governmental body of which he is a
member, as follows:
7
Our conclusion here is limited to a consideration of subsection 572.058(a) and is not authority for the
proposition that the Council is a state agency for all purposes.
8
You ask only about the applicability of certain statutory conflict-of-interest provisions to grant awards. We
note that most, if not all, grant awards of government funding would implicate an underlying contract, and it inherently
a contractual relationship. That said, we recognize that distinctions between contracts and grant awards exist at law.
For example, Government Code chapter 783 provides that “[t]he office of the comptroller is the state agency for
uniform grant and contract management,” and your office has accordingly disseminated the Texas Grant Management
Standards. TEX. GOV’T CODE § 783.004; see TEX. COMPTROLLER OF PUB. ACCTS., Texas Grant Management
Standards (Dec. 2021), https://comptroller.texas.gov/purchasing/grant-management/ (“Guide”). That document in
turn distinguishes in some cases between grant awards and contracts. See Guide at 4 (stating that “[i]n the
administration of state and federal grant programs, the terms ‘grant’ and ‘contract’ are not synonymous” and that for
purposes of the Texas Grant Management Standards, “the term ‘contract’ refers to the legal instrument used to enter
into a procurement relationship with a contractor to acquire goods and services to carry out the project or program
under a state or federal grant”). That said, you do not suggest, and we do not find any authority suggesting, that the
statutory conflict-of-interest provisions about which you inquire are inapplicable on the basis that the Council will
award grants. See id. at 7 (noting applicability of Government Code chapter 571’s conflict-of-interest provisions); see
also TEX. GOV’T CODE § 2261.002(1) (defining “[c]ontract” to include “a grant . . . under which the recipient of the
grant is required to perform a specific act or service, supply a specific type of product, or both”). Accordingly, we
consider the applicability of the statutory provisions you ask about without reference to any legal distinctions between
a “grant” and a “contract” not apparent within those statutes.
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If a public official directly or indirectly has a pecuniary interest in a
contract, no matter how honest he may be, and although he may not
be influenced by the interest, such a contract so made is violative of
the spirit and the letter of our law, and is against public policy.
Meyers, 276 S.W. at 307. Upon finding the Meyers standard applicable, JM-671 relied on a later
court of appeals decision to note that the “conflict of interest cannot be cured by the interested
officer’s recusing himself.” Tex. Att’y Gen. Op. No. JM-671 (1987) at 3 (citing Delta Elec. Constr.
Co. v. City of San Antonio, 437 S.W.2d 602, 609 (Tex. App.—San Antonio 1969, writ ref’d n.r.e.)).
This office determined that a contract would be void if entered into when a member of the
governmental body had a pecuniary interest. Tex. Att’y Gen. Op. No. JC-0484 (2002) at 4
(concluding that “a grant from the [Texas Council on Environmental Technology] represents a
contractual relationship that is not subject to section 572.058, even if a formal contract is not
executed”). A contract entered into when a member of the governmental body had a pecuniary
interest would be void as a matter of law. Id. at 5, 6.
At the time JM-671 was decided, the requirement in section 572.058 was located in Texas
Revised Civil Statutes article 6252-9b, section 6. See Act of May 28, 1973, 63d Leg., R.S., ch.
421, § 1, 1973 Tex. Gen. Laws 1086, 1093. This statutory predecessor to section 572.058 became
effective January 1, 1974. Id. at 1095. Although article 6252-9b, section 6 was enacted years after
Meyers v. Walker, JM-671 rejected an argument that its passage abrogated the Meyers v. Walker
rule. See Tex. Att’y Gen. Op. No. JM-671 (1987) at 6–7, 8 (“In our opinion, article 6252-9b, 9
V.T.C.S., did not modify the common law conflict of interest rule stated in Meyers v. Walker.”
(footnote added)). Noting the statute’s lack of express language pertaining to contracts when
analyzed against a comparable provision in another statute, JM-671 relied primarily on legislative
history to reach this result. Id. at 6–7.
Reconsideration of Opinion JM-671
Since the issuance of JM-671, this office has relied on the Meyers v. Walker framework in
many opinions. See, e.g., Tex. Att’y Gen. Op. Nos. KP-0259 (2019), GA-0351 (2005), JC-0484
(2002), DM-310 (1994). Yet, we have not seriously re-examined or reconsidered the basis of its
analysis or conclusion. Your question provides us the opportunity to do so now. For the reasons
discussed below, we believe that, today, a court considering whether section 572.058 applies to
contracts, including grant awards, would likely come to a different conclusion than JM-671.
9
See Act of April 30, 1993, 73d Leg., R.S., ch. 268, §§ 1, 46, 1993 Tex. Gen. Laws 583, 583, 986 (adopting
nonsubstantive revisions of certain statutes relating to state and local government and repealing certain statutes
including article 6252-9b)); see also Tex. Att’y Gen. Op. No. GA-0351 (2005) at 3 (recognizing Revised Civil Statutes
article 6252-9b, section 6, as statutory predecessor to Government Code subsection 572.058(a)).
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1. JM-671 relied on the distinction between section 572.058 and language
from a separate conflict-of-interest statute relating to local governmental
officials.
When JM-671 was issued in 1987, the disclosure and recusal provisions of subsection
572.058(a) existed in a predecessor statute. See Tex. Att’y Gen. Op. No. JM-671 (1987) at 6
(referring to subsection 6(a), article 6252-9b, Texas Civil Statutes); see also Act of May 28, 1973,
63d Leg., R.S., ch. 421, § 1, 1973 Tex. Gen. Laws 1086, 1093.
In rejecting the argument that the predecessor statute nullified the common-law rule, JM-
671 looked to an analog statute governing conflicts of interest for local government officials. Tex.
Att’y Gen. Op. No. JM-671 (1987) at 5–6 (referring to subsection (3)(a)(1), article 988b, Texas
Civil Statutes); see also Act of May 28, 1983, 68th Leg., R.S., ch. 640, § 3, 1983 Tex. Gen. Laws
4079, 4080. An earlier Attorney General opinion had concluded that the analog conflict-of-interest
provision nullified the common law for local government officials. See Tex. Att’y Gen. Op. No.
JM-424 (1986) at 4, 8–9. The two provisions were similar, but the analog statute contained
additional language that the section 572.058 predecessor did not. Specifically, the analog provision
provided that “[t]he governing body of a governmental entity may contract for the purchase of
services or personal property with a business entity in which a member of the governing body has
a substantial interest if” certain conditions existed. Tex. Att’y Gen. Op. No. JM-671 (1987) at 5
(quoting article 988b) (emphasis added). Because the section 572.058 predecessor lacked similar
“may contract” language, JM-671 concluded it did not expressly contemplate contract formation
and thus did not apply to contracts. Id. at 6.
2. JM-671 relied too heavily on the legislative history.
JM-671 relied heavily on the legislative history of the predecessor statute to section
572.058. See id. Texas courts have since cautioned against misplaced reliance on such history. See,
e.g., Brown v. City of Houston, 660 S.W.3d 749, 755 (Tex. 2023) (“Legislative history is generally
useless to courts—indeed, it can be worse than useless because it is manipulable and relies on what
never was the law.”). Specifically, JM-671 noted that legislative conference committee members
“expressed the opinion that the restriction on voting by members of the legislature in article III,
section 22 of the Texas Constitution should also apply to members of boards and commissions.”
Tex. Att’y Gen. Op. No. JM-671 (1987) at 6. Because the constitutional provision was applicable
to legislators and because legislators “do not enter into contracts for the state,” JM-671 opined
without analysis that it was “reasonable to conclude” that section 572.058’s predecessor did not
apply to contracts. Id. at 7. We disagree. Were a court to even consider this legislative history
today, it would be unlikely to find JM-671’s inference reasonable.
3. A court considering the question anew would likely conclude that section
572.058 applies to contracts.
A court considering the effect of section 572.058 on contracts would begin with its text to
ascertain the Legislature’s intent. See Colorado Cnty. v. Staff, 510 S.W.3d 435, 444 (Tex. 2017).
Courts look “first and foremost in the statutory text, and where text is clear, text is determinative
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of intent.” Id. (cleaned up) (acknowledging that “[t]he plain meaning of the text is the best
expression of legislative intent”).
The text of 572.058 expressly provides that it applies to an officer “who has a personal or
private interest in a measure, proposal, or decision pending before the board or commission . . . .”
TEX. GOV’T CODE § 572.058(a). A governmental body considering whether to enter a contract,
and under what terms, is making a decision. See NEW OXFORD AMERICAN DICTIONARY 449 (3d
ed. 2010) (defining “decision” to mean “a conclusion or resolution reached after consideration; the
action or process of deciding something or of resolving a question”). There is no language in
section 572.058 suggesting that contract formation should be excluded from its purview. Thus, a
court would likely construe section 572.058 to encompass decisions about contract formation. See
O’Brien v. State, 544 S.W.3d 376, 384 (Tex. Crim. App. 2018) (“If the plain language is clear and
unambiguous, our analysis ends because the Legislature must be understood to mean what it has
expressed, and it is not for the courts to add or subtract from such a statute.” (quotation marks
omitted)). Moreover, the “contract with” language from the local-government-official analog
statute that was seminal to JM-671 no longer exists 10 such that a court today comparing 572.058
with the analog statute’s successor, chapter 171 of the Local Government Code would have no
basis to construe section 572.058 in conjunction with it.11
For these reasons, a court would likely conclude that section 572.058 includes contract
formation, or stated differently, that section 572.058 applies to a governmental body’s decision to
enter a contract, including a grant award. Accordingly, we overrule JM-671 and its progeny to the
extent they conflict with our opinion here. 12
A court would likely conclude that section 572.058 abrogates the common-law rule
articulated in Meyers v. Walker.
Absent the impediment of JM-671, we must newly determine whether section 572.058
abrogates the strict rule in Meyers v. Walker. The Texas Supreme Court has explained that a statute
can only modify or abrogate common law rules when that is what the Legislature clearly intends.
Abutahoun v. Dow Chem. Co., 463 S.W.3d 42, 51 (Tex. 2015). Such abrogation is generally
disfavored, and courts examine the statute’s plain language for the Legislature’s clear intention to
replace the common law. Id.; Energy Serv. Co. of Bowie, Inc. v. Superior Snubbing Servs., Inc.,
236 S.W.3d 190, 194 (Tex. 2007) (“Of course, statutes can modify common law rules, but before
we construe one to do so, we must look carefully to be sure that was what the Legislature
intended.”); Am. Nat’l Ins. Co. v. Arce, 672 S.W.3d 347, 355 (Tex. 2023) (“It goes without saying
that statutes can modify or displace common-law rules, but . . . we must ascertain whether [the
10
The relevant language was removed shortly after JM-671 was issued. See Act of May 27, 1987, 70th Leg.,
R.S., ch. 362, § 1, 1987 Tex. Gen. Laws 1798, 1800.
11
Even if the language still existed and if a court were it to consider it, a court would be unlikely to determine
that the “contract with” language of article 988b made contract formation something other than a “decision” under
chapter 572. That is, a court would be unlikely to exclude the decision to enter a contract from the scope of possible
action by a governmental body that would be subject to the disclosure and recusal requirement of section 572.058.
See generally Tex. Att’y Gen. Op. Nos. KP-0259 (2019), GA-0351 (2005), JC-484 (2002), JC-455 (2002),
12
JC-437 (2001), DM-310 (1994); Tex. Att’y Gen. LO-97-052, LO-93-12, LO-92-52, LO-88-44.
The Honorable Glenn Hegar - Page 9
statute] actually does so.”). Courts will construe section 572.058 as abrogating the common law
“only if there exists a clear repugnance between the two.” Wasson Interests, Ltd. v. City of
Jacksonville, 489 S.W.3d 427, 437 (Tex. 2016) (quotation marks omitted).
In section 572.058, the Legislature changes the conflict-of-interest rule from the common
law in at least three important ways. First, under the common law, an officer cannot cure the
conflict by recusal. See Delta Elec. Constr. Co v. City of San Antonio, 437 S.W.2d 602, 608 –09
(Tex. App.—San Antonio 1969, writ ref’d n.r.e.). Section 572.058 instead requires the officer to
publicly disclose the interest and “not vote or otherwise participate in the decision.” TEX. GOV’T
CODE § 572.058(a). Second, the common law pertained only to pecuniary, or financial, interests.
See Meyers, 276 S.W. at 307 (“If a public official directly or indirectly has a pecuniary interest in
a contract” the contract is against public policy.). Section 572.058 expands the interests for which
disclosure is required to any “personal or private interest.” TEX. GOV’T CODE § 572.058(a). And
third, the common-law rule is limited to contracts, while section 572.058 applies to any “measure,
proposal, or decision . . . .” Compare Meyers, 276 S.W. at 307, with TEX. GOV’T CODE
§ 572.058(a). Even without language expressly abrogating the common law, these differences
show a clear repugnance between the two and indicate that the Legislature intended to modify the
common law with a less strict, more expansive conflict-of-interest provision that covers and
protects from conflicts not only the contractual decisions of governmental bodies that Meyers v.
Walker addressed but that instead covers “any measure, proposal or decision.” Accordingly, a
court would likely conclude that section 572.058 abrogates the strict rule in Meyers v. Walker.
Application of Government Code section 2261.252
You also ask if “section 572.058 applies, does it override the outright prohibition on
contracts for goods and services contained in section 2261.252.” Request Letter at 5. Government
Code section 2261.252 addresses the disclosure of potential conflicts of interests. TEX. GOV’T
CODE § 2261.252. Subsection 2261.252(a) provides that
[e]ach state agency 13 . . . official who is involved in procurement or
in contract management for a state agency shall disclose to the
agency any potential conflict of interest specified by state law or
agency policy that is known by the . . . official with respect to any
contract with a private vendor or bid for the purchase of goods or
services from a private vendor by the agency.
Id. § 2261.252(a) (footnote added).
Government Code section 2261.252 also prohibits certain contracts. See id. § 2261.252.
Subsection 2261.252(b) states that “[a] state agency may not enter into a contract for the purchase
of goods or services with a private vendor” with whom an agency official, including a member of
the agency’s governing body has a financial interest. Id. § 2261.252(b)(1). Relevant here, a
13
Subsection 2261.002(2) defines “[s]tate agency” by reference to subsection 2151.002(1). TEX. GOV’T CODE
§ 2261.002(2); see id. § 2151.002(1) (defining “state agency” to mean “a department, commission, board, office, or
other agency in the executive branch of state government created by the state constitution or a state statute”).
The Honorable Glenn Hegar - Page 10
contract “includes a grant . . . under which the recipient of the grant is required to perform a specific
act or service, supply a specific type of product, or both.” Id. § 2261.002(1). An official has a
“financial interest” in a person 14 if the official:
(1) owns or controls, directly or indirectly, an ownership interest of
at least one percent in the person, including the right to share in
profits, proceeds, or capital gains; or
(2) could reasonably foresee that a contract with the person could
result in a financial benefit to the . . . official.
Id. § 2261.252(c). No language in section 572.058 expressly overrides anything in section
2261.252. See generally id. § 572.058.
We first address the potential conflicting interaction between section 572.058 and 2261.252
more thoroughly. See Request Letter at 5–6. Courts construe statutes in a way that harmonizes and
gives effect to the different provisions when possible. Harbor Am. Cent., Inc. v. Armand, No. 04-
22-00280-CV, 2024 WL 1289596, at *4 (Tex. App.—San Antonio Mar. 27, 2024, no pet. h.); see
also TEX. GOV’T CODE §§ 311.025, .026(a). If two statutes “irreconcilably conflict and one statute
is a general provision and the other is more specific, the specific statute prevails as an exception
to the general provision, unless (1) the Legislature enacted the general provision later than the
specific statute; and (2) the Legislature manifestly intended that the general provision prevail.”
Dailing v. State, 546 S.W.3d 438, 443 (Tex. App.—Houston [14th Dist.] 2018, no pet.) (citing
TEX. GOV’T CODE § 311.026). If two statutes are irreconcilable and neither statute is more specific
than the other, the later-enacted statute prevails. See TEX. GOV’T CODE § 311.025. That said, it is
only when the two provisions are irreconcilable that the courts will look to these rules of
construction to determine which provision applies. See Armand, 2024 WL 1289596, at *4; see also
TEX. GOV’T CODE §§ 311.025, .026(b).
A mere difference between provisions is insufficient to constitute an irreconcilable conflict.
See Garcia v. State, 669 S.W.2d 169, 171 (Tex. App.—Dallas 1984, writ ref’d). Irreconcilable
conflict occurs when only one of the statutes can apply to a particular situation. See Lomax v. State,
233 S.W.3d 302, 312 (Tex. Crim. App. 2007); see also Ferrell v. Univ. of Tex. Sys., 583 S.W.3d
805, 810–12 (Tex. App.—El Paso 2019, no pet.) (recognizing that if both statutory provisions’
purposes can be given effect, they are not in conflict). We begin by determining whether subsection
2261.252(a) and subsection 572.058(a) irreconcilably conflict.
Subsection 572.058(a) requires an elected or appointed officer with a prohibited interest to
“publicly disclose that fact” in an open meeting and provides that the officer “may not vote or
otherwise participate in the decision.” TEX. GOV’T CODE § 572.058(a). Subsection 2261.252(a)
similarly provides that “[e]ach state agency employee or official who is involved in procurement
or in contract management for a state agency shall disclose . . . any potential conflict of interest
. . . .” Id. § 2261.252(a). In its application, subsection 2261.252(a) encompasses a potentially larger
14
“Person” includes an artificial person. See TEX. GOV’T CODE § 311.005(2) (defining “[p]erson” to include
legal entities in addition to individuals).
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set of people by including employees, but it limits that set to only those involved in “procurement
or in contract management . . . .” Id. And both provisions require the person with the conflicting
interest to disclose it. See id. §§ 572.058(a), 2261.252(a). The interest in section 572.058 is “a
personal or private interest in a measure, proposal, or decision pending before the board or
commission . . . .” Id. § 572.058(a). The interest in section 2261.252 is a “potential conflict of
interest specified by state law or agency policy that is known by the employee or official with
respect to any contract with a private vendor or bid for the purchase of goods or services . . . .” Id.
§ 2261.252(a). To the extent a member of the Council has an interest that implicated both
subsection 572.058(a) and subsection 2261.252(a), the member could disclose the interest as set
forth in both provisions and thereby comply with both. A court would likely conclude that these
two subsections do not conflict. Accordingly, an entity subject to both provisions must comply
with both.
Yet, we question whether section 2261.252 applies under these circumstances. By its plain
terms, section 2261.252 “applies only to a contract for the purchase of goods or services solicited
through a purchase order if the amount of the purchase order exceeds $25,000.” Id. § 2261.252(e).
You do not expressly indicate that the Council’s grant award process involves “a contract for the
purchase of . . . services solicited through a purchase order.” Id.; see generally Request Letter at
1–7. And the administrative rules for the Opioid Abatement Fund Program affirmatively set out
an issuance plan and provide for the review of grant applications, the awarding of grants, as well
as continued monitoring for a grant award performance and expenditures thereunder. See 34 TEX.
ADMIN. CODE §§ 16.202 (2023) (Comptroller of Pub. Accts., Grant Issuance Plan), 16.209 (2023)
(Comptroller of Pub. Accts., Amount of Grant Award), 16.208 (2023) (Comptroller of Pub. Accts.,
Grant Application Review), 16.219 (2023) (Comptroller of Pub. Accts., Monitoring Grant Award
Performance and Expenditures). Nothing in these rules provide that a grant is awarded pursuant to
a purchase order. While this ultimately is a fact question that we leave to the Council in the first
instance, if the Council’s granting of award does not involve such solicitation through a purchase
order, then by the plain terms of subsection 2261.252(e) the section does not apply to the grant.
See TEX. GOV’T CODE § 2261.252(e).
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S U M M A R Y
In Opinion JM-671, this office concluded that the statutory
predecessor to Government Code subsection 572.058(a) did not
apply to contracts and so did not abrogate the common law as stated
in Meyers v. Walker. Instead, JM-671 concluded that the strict
conflict-of-interest rule from Meyers v. Walker governed contract
formation and voided any contract entered into by an agency if a
member of its governmental body had any pecuniary interest in the
contract. Since the issuance of JM-671, this office has not
reconsidered its reasoning or conclusion. Doing so here, this office
concludes it is likely that a court considering the questions addressed
in JM-671 would decide them differently today. Accordingly, we
hereby overrule JM-671 and its progeny to the extent they conflict
with this opinion.
Further, a court newly considering whether subsection
572.058(a) applies to contracts and abrogates the common law
would likely conclude that it does. Under subsection 572.058(a), an
elected or appointed officer with a conflict must disclose the interest
and recuse him or herself from participating in the matter.
Accordingly, neither JM-671 nor subsection 572.058(a) is a bar to
the award of a grant by the Texas Opioid Abatement Fund Council
(“Council”) established in chapter 403 of the Government Code.
Instead, Council members must publicly disclose their interests in
an open meeting of the Council and must refrain from deliberating
or voting on matters as directed by section 572.058. Accordingly,
Council members may participate in deliberations and vote on
matters that do not involve their personal or professional interest.
Government Code chapter 2261 provides for contracting
standards and oversight for state contracting. Subsection
2261.252(e) provides that section 2261.252 applies only to a
contract for the purchase of goods or services solicited through a
purchase order if the amount of the purchase order exceeds $25,000.
We question whether a grant award from the Council is made via a
purchase order. But we do not resolve fact questions in an Attorney
General Opinion and leave the determination about the application
of section 2261.252 to the Council.
Very truly yours,
KEN PAXTON
Attorney General of Texas
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BRENT WEBSTER
First Assistant Attorney General
LESLEY FRENCH
Chief of Staff
D. FORREST BRUMBAUGH
Deputy Attorney General for Legal Counsel
AUSTIN KINGHORN
Chair, Opinion Committee