You have requested our opinion regarding the authority of the Denton City-County Hospital Board to ,&ease iand to,~ private persons for construction of a medical office building. Specifically, you ask:

Whether or not the City-County,Hospitai Board may lease a portion of the hospital grounds to 'an individual or corporation for a medical-professional building, with a; provision for reversion of the premises and building.to the board~at.the:conclusion of the lease period.

The proposed building would be'~adjacent to the hospital and connected to it by a bridge at each level. The City-County Hospital Board would lease the land on a long term lease, and private persons wo,uld be,responsible for financing, constructing, and managing the building.. On completion of the lease, title to',the building would revert to the City- County Hospital Board. .The Board would not spend,any public funds or assume any liabilities.

'The Denton City-County Hospital Board,was .created under article 4494i-1, V.T.C.S. See Atto,rney General Opinion M- -, 762 .(1970). Then Hospital Board constitutes a "joint agent" of the,county and city forhospital purposes. V~.T.C.S. art. 4494i-1, 6 2. At present, title,to.the,hospita&,~grounds remains in the ~city and county, but .section5 of article p. 4026 ~..

4494i-1 authorizes the city and county to convey the hos- pital and the associated real property to the Hospital Board. The Board may lease property, subject to the ap- proval of the commissioners court and governing body of the city. V.T.C.S. art. 4494i-1, 59 4, 5. The city and county may thereby assure themselves that the Board in making the lease has acted "solely for [their] joint benefit." V.T.C.S. art. 4494i-1, 9 2. The Hospital Board must act "for hos- pital purposes." 1d:We believe it will act for hospital purposes if it arranges a lease that upon termination pro- vides them with a medical facility adjoining the hospital, and in the interim benefits hospital patients. See Sullivan v. Andrews Count 517 S.W.2d 410 (Tex. Civ. App.- El Paso m74, writ re -T-# n.r.e.). Consequently, article 4494i-1, V.T.C.S., authorizes the Board to make the proposed lease.

The ~1eas.e of hospital grounds also must comply with article 3, section 52 of the Texas Contitution, which pro- hibits any county or city from granting any "public money or thing of value in aid of, or to any individual, associa- tion or corporation whatsoever . . . ." The city or county cannot accomplish through its agent something the Consti- tution forbids it to do. See Attorney General Opinion C-517 (1965). Therefore, s Denton City-County Hospital Board may lease hospital property only to accomplish a public purpose, and the lessee must pay an adequate con- sideration for use of the property. Sullivan v. Andrews County, supra; Attorney General Opinion H-777 n976).n Sullivan v. Andrews County, the court found that the county could constitutionally lease to doctors space in a medical office building adjoining the hospital where the evidence showed that hospital patients would benefit from the close- ness and ready availability of the treating physicians. YOU have not informed us about the terms of the proposed lease, so we cannot determine as a matter of law whether it would accomplish this or an analogous public purpose. In drawing up and approving the lease, the Hospital Board, city govern- and county commissioners should be certain that the ment, lc-ese will serve a public purpose and include sufficient controls so that the public purpose is actually accomplished. See Attorney General Opinion H-445 (1974). The rent should beset so that together with the reversion of the building at the end of ~the lease, the Hospital Board receives adequate consideration for the use of its property. See Attorney General Opinions H-912, H-777 (1976); H-445 (1974). If these requirements are complied with, the proposed lease will not violate article 3, section 52 of the Constitution.

P. 4027

SUMMARY Article 44941-1, V.T.C.S. authorizes the City-County Hospital Board to lease'land adjacent to the hospital for construction of a medical office building by private individuals. Article 3, section 52 requires that the lease serve a public purpose and provide for payment of adequate rentals.

ttorney General of Texas APPROVED:

Opinion Committee

p. 4028