We are in reoeipt of your ~letter of February 22, 1939 in which you request an opinion from this Department as to whether the excess cash in a sinking fund for the retirement of bonds may be used by a Road District for other specific purposes.

A ttached to your reque,st is a resolution for ruling on the sinking fund surplus~. This resolution states in effect that there are outstanding bonds against Road District No. 1 in Newton County, amounting to $26,025.00 principaland accrued interest; that there is now in the County Treasury to the ‘credit of said fund, as a result of the collection of taxes levied to pay said bonds and interest, $40,224.21, or a surplus of $14,199.21.

Section 52, Article 3 of the Constitution of Texas pro- vides that road districts may vote bonds for the purpose of Athe construction, maintenance, and operation of macadamized gravel or paved roads and turnpikes, or in aid thereof.”

Article 752k Revised Statutes, provides that when the bonds are issued, the Commissioners Court shall levy an ad valor- em tax sufficient to pay the interest on such bonds, and to pro- vide a sinking fund to.pay the bonds at maturity.

Article 752n Revised Statutes, provides that the Tax Collector shall collect ‘,’ said taxes and’ pay same to the County Treasure~r. Article’7520, Re~vised Statutes, provides that the County Treasurer is the custodian of the funds and shall promptly pay the interest and principal as it becomes due on the bonds out of the funds collected ~from said taxes.

There ins no provision in the law for what the County Treasurer shall .do with any excess fund collected from the taxes levied, over and above the amount required to pay the bonds, prin- cipal and interest.

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Hon. A. A. Miller, page 2

Article 839, Revised Statute,s, provides that the County Treasurer shall not honor or pay any draft upon the interest and sinking fund provided for the payment of the bonds, except for the purpose of paying the interest on such bonds or redeeming same, or for investment in seaurities as provide d by law.

The Supreme Court in Black v. Strength 246 S.W. 79 and in Aransas County v. Coleman-Fulton Pasture Ci 191 s.w. $56, and in Moore v. Coffman, 200 S.W. 374, has held thii money voted for specific purposes or for building designated roads or bridges, must be used for such specific purposes.

The County Treasurer, as well as the County Depository, are under bond to pay the fund out, and are authorized to pay same out only for the purposes authorized by law. Since there is no provision in the law for the County Treasurer making any disposition of the surplus fund after the specific bonds are paid, we are inclined to the view that this surplus collection of taxes could be used in said road district for the upkeep and mainten- ance of the roads in said district. Since, however, the custo- dians of said funds are under bond, we think it advisable for the County Treasurer and the County Depository to institute a suit in rem in the District Court in Newton County, setting up the facts and have that court enter an order authorizing them to pay said &unds on warrants drawn by order of the Commissioners Court for the maintenance of the roads of said district, or for what- ever purpose the District Court, under all of the existing facts, should think proper.

We will next week call the attention of Senator Redding of Lufkin, your Senator, to the situation and suggest that he introduce a bill amending ,Article 839 of ihe Revised Statutes to authorize the excess or surplus left after bonds have been paid to be used by the County Commissioners in the districts where the bonds were voted for the purpose of the upkeep and maintenance of the roads in said districts. It might be wise for your Commis- sioners Court to communicate with the Senator relative to the matter.

It is our opinion that it would be unwise for the County Treasurer and County Depository to pay said fund except on the direct order of the District Court.

APPROVED : Yours very truly /s/ Gerald G. Mann ATTORNEY GENERAL OF TEXAS ATTORNEY GENERAL OF TEXAS By George W. Barcus /2/

George W. Barcus, Assistant GWB

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