Texas Attorney General Opinion: JC-391 Page: 2 of 3
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The Honorable J. E. "Buster" Brown - Page 2 (JC-0391)
Article XVI, section 40 of the Texas Constitution provides, in relevant part:
State employees or other individuals who receive all or part of their
compensation either directly or indirectly from funds of the State of
Texas and who are not State officers, shall not be barred from serving
as members of the governing bodies of school districts, cities, towns,
or other local governmental districts; provided, however, that such
State employees or other individuals shall receive no salary for
serving as members of such governing bodies.
TEX. CONST. art. XVI, 40 (emphasis added). A municipal utility district is a "local governmental
district." But cf County ofMaverick v. Ruiz, 897 S.W.2d 843, 847 (Tex. App.-San Antonio 1995,
no writ) (county is not a "local governmental district" under article XVI, section 40 of Texas
Constitution). This provision means that a person who receives his compensation from the state,
either directly or indirectly, is entitled to serve as a member of a local governing body, such as a
municipal utility district, only ifhe receives no salary for the latter position other than reimbursement
for actual expenses. Tex. Att'y Gen. LO-95-001, LO-93-033. Subsection 49.060(a) of the Water
Code authorizes the payment of fees beyond reimbursement for expenses to directors of a municipal
utility district. Your question is whether the individual in question, who is compensated by a
company whose only income derives from a state contract, may be said to be a person "who receives
all or a part of his compensation either directly or indirectly from funds of the State of Texas."
Request Letter, supra note 1, at 2.
The proviso of article XVI, section 40 is applicable to persons other than state employees.
Teachers employed by an independent school district, employees of a district attorney, and
employees of a junior college district are examples of individuals to whom the proviso applies.
Their salaries as essentially local employees are supplemented from state funds. See Tex. Att'y Gen.
Op. No. JM-118 (1983); Tex. Att'y Gen. LO-94-045, LO-90-106. The distinction that all these
persons share, other than receiving part of their compensation from state funds, is that they arepublic
employees. On the other hand, the individual of whom you inquire is not a public employee.
Moreover, he does not receive his salary, either directly or indirectly, from funds of the state.
Rather, he is compensated as an employee of a private employer that, as it happens, has contracted
with the state. The proviso is no more applicable to such a person than it is to an employee of any
other private company that receives state funds pursuant to a contract. The article XVI, section 40
proviso should not be construed to cast so wide a net. In order to fall within its ambit, we believe
that an individual, in addition to receiving "all or part of his compensation" from the state, must also
be reasonably classifiable as a public employee.
We conclude that an individual employed by a company that receives all of its revenue from
a contract with the State of Texas may be compensated as a director of a municipal utility district.
John Cornyn, Texas Attorney General (Feb. 13, 2001) (on file with Opinion Committee) [hereinafter Request Letter].
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Texas. Attorney-General's Office. Texas Attorney General Opinion: JC-391, text, 2001; (texashistory.unt.edu/ark:/67531/metapth274700/m1/2/: accessed December 18, 2018), University of North Texas Libraries, The Portal to Texas History, texashistory.unt.edu; crediting UNT Libraries Government Documents Department.