Texas Attorney General Opinion: V-168 Page: 4 of 5
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Hon. R. P. Spacek, Page 4, V-168
"the concluding words of the section
above quoted are very significant. 'The
State shall be responsible for all invest-
ments' can only mean that when the Board
of Education, acting through the Comptrol-
ler, has invested in securities authorized
therein, in other words, has exercised its
jurisdiction there conferred, the State
shall make good any and all losses to the
Public Free School Fund to the extent of
a guarantor of the securities0 This lia-
bility of the State generally is a consti-
tutional one, and the Legislature is power-
less to absolve it therefrom, The sanctity
of our Public Free school PFud is such that
the people through the Constitution have in
this emphatic manner seen fit to protect it
so far as is humanly or governmentally pos-
"When the Board of Education and the
Comptroller have acted in the exercise of
the power conferred upon them, and have made
investments in certain securities, within
the scope of that power, they have exercised
their jurisdiction, and the benefits of such
investments instantly become indelibly fixed
in the Public Free School Fund of the State,
to the protection of which the State's finan-
cial resources are pledged."
It follows, from what we have said, that if
House Bill No. 660 should become a law, as written, the
State Board of Education would have no authority to ex-
change bonds unmatured for new refunding bonds issued
by the same issuer, but at a lesser rate of interest0
House Bill No. 660, 50th legislature,
as it is written, if the same were enacted
into law, would be in violation of Section
4 of Article VII of the Constitution of Tex-
as insofar as it may authorize the exchange
of bonds owned by the State Board of Educa-
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Texas. Attorney-General's Office. Texas Attorney General Opinion: V-168, text, April 28, 1947; (texashistory.unt.edu/ark:/67531/metapth264988/m1/4/: accessed November 20, 2018), University of North Texas Libraries, The Portal to Texas History, texashistory.unt.edu; crediting UNT Libraries Government Documents Department.