Untitled Texas Attorney General Opinion
GA-0894
| Tex. Att'y Gen. | Jul 2, 2011Background
- TSU owns three Olivewood Cemetery parcels in Houston; two are dedicated cemetery lands and one adjoins the cemetery.
- The Descendents of Olivewood, a Texas nonprofit, seeks to restore the cemetery and obtain TSU property for the project.
- Appraisal: cemetery parcels have zero value; adjacent parcel valued at $11,250.
- Corporation proposes either donating historical cemetery papers or granting TSU access in exchange for TSU’s three parcels.
- Constitutional restraints prohibit gratuitous transfer of state property to private entities; exchange or gift must meet Article III constraints.
- Question presented: whether TSU may convey for adequate consideration (papers or access) or as a gift, and whether such conveyance serves a university purpose.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Can TSU convey property in exchange for papers or access without violating Art. III? | TSU could exchange for papers or access as adequate consideration. | Gratuitous transfers are prohibited; only exchange with adequate consideration is allowed if constitutionally valid. | Permissible only if papers/access constitute adequate consideration. |
| May TSU grant real property by gift to a private corporation to serve a public purpose? | Public benefit could support a gift. | Gifts to private entities generally prohibited unless serving an authorized university purpose. | TSU may not grant by gift to a private entity except to serve an authorized university purpose. |
| Who determines adequacy of consideration and whether the transaction serves a university purpose? | Governing board should determine adequacy and public purpose. | Determination is a factual question for the university board to decide in the first instance. | Adequacy and public-purpose alignment are board-determined in the first instance. |
Key Cases Cited
- Rhoads Drilling Co. v. Allred, 70 S.W.2d 576 (Tex. 1934) (prohibits gratuitous disposition of state property where not authorized)
- Pasadena Police Officers Ass'n v. City of Pasadena, 497 S.W.2d 388 (Tex. Civ. App.-Houston [1st Dist.] 1973) (gratuitous transfer of property rights violates constitutional provisions)
- Walker v. City of Georgetown, 86 S.W.3d 249 (Tex. App.-Austin 2002) (adequacy of consideration for property transfers evaluated for public interest)
- City of Austin v. Austin City Cemetery Ass'n, 73 S.W. 525 (Tex. 1903) (permission to use property can constitute consideration for conveyance)
- Edgewood Indep. Sch. Dist. v. Meno, 917 S.W.2d 717 (Tex. 1995) (public purpose and limitations on public funds/real-property grants to private entities)