Did a Texas health-facilities development corporation have to follow the Open Meetings Act?

Texas AG Opinion JM-794: Open Meetings and Health-Facilities Corporations

Plain-English summary

Two requestors asked whether the board of a Health Facilities Development Corporation created under former article 1528j had to conduct its meetings under the Texas Open Meetings Act.

The Attorney General concluded that it did not. The former Act applied to meetings of a defined governmental body. These nonprofit public corporations did not fit the state-level category or any of the Act's specific local categories.

Although a city, county, or hospital district sponsored and supervised each corporation, the corporation could not exercise delegated sovereign powers. JM-794 therefore did not treat it as a department, agency, political subdivision, or special district of the sponsoring government. Former article 1528j also contained no express Open Meetings Act requirement.

Currency note

This opinion was issued in 1987. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

What kind of entity was the corporation?

JM-794 described it as a nonprofit public corporation created by a sponsoring city, county, or hospital district under former article 1528j.

Why was it not a local political subdivision under the Act?

The corporation could not receive delegated sovereign powers and had only the authority granted by its enabling statute.

Was it considered a special district?

No. The opinion distinguished a nonprofit public corporation from a governmental special district, which it described as an entity usually possessing taxing authority and providing special governmental services in a locality.

Did sponsorship and supervision make the corporation a governmental body?

No. Those features did not place it within any of the former Act's expressly listed local-government categories.

Could an enabling statute require open meetings for a public corporation?

Yes. The opinion noted that a public corporation's statute could expressly impose the Open Meetings Act, but former article 1528j did not do so.

Background and statutory framework

Former article 6252-17 applied to meetings of governmental bodies and divided that definition into state-level entities and three groups of specified local entities. Earlier opinions required a local body to fit one of those express descriptions.

Former article 1528j allowed sponsoring governments to create health-facilities corporations with authority to issue revenue bonds and notes for health facilities, research, and education. The corporations remained supervised by their sponsors but could not exercise delegated sovereign powers.

JM-794 compared these entities to nonprofit water-supply corporations considered in JM-596 and concluded that neither type fit the former Open Meetings Act's definition.

Citations

Statutes and prior opinions:

• Former V.T.C.S. article 6252-17, sections 1(c) and 2(a)
• Former V.T.C.S. article 1528j, sections 1.02 and 4.01
• Texas Attorney General Opinions JM-120 (1983), JM-183 (1984), JM-340 (1985), and JM-596 (1986)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/jim-mattox/jm-794
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1987/jm0794.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Obvious character-level OCR errors have been corrected, but minor errors may remain; the linked PDF is authoritative.

September 24, 1987

Honorable Bill Baumann
Potter County Attorney
303 Courthouse
Amarillo, Texas 79101

Mr. John A. Fairman
Director
Harris County Health Facilities Development Corporation
8203 Fawn Terrace
Houston, Texas 77071

Opinion No. JM-794

Re: Whether meetings of a Health Facilities Development Corporation created pursuant to article 1528j, V.T.C.S., are subject to the Open Meetings Act, article 6252-17, V.T.C.S.

Gentlemen:

You ask whether meetings of the board of directors of a Health Facilities Development Corporation created pursuant to article 1528j, V.T.C.S., must be held in compliance with the Texas Open Meetings Act, article 6252-17, V.T.C.S. The Open Meetings Act applies to every "meeting" of a "governmental body." See art. 6252-17, § 2(a). Whether the corporation is subject to the Open Meetings Act depends on whether the corporation falls within the act's definition of a "governmental body."

Section 1(c) of the Open Meetings Act defines a "governmental body" as

any board, commission, department, committee, or agency within the executive or legislative department of the state, which is under the direction of one or more elected or appointed members; and every Commissioners Court and city council in the state, and every deliberative body having rulemaking or quasi-judicial power and classified as a department, agency, or political subdivision of a county or city; and the board of trustees of every school district, and every county board of school trustees and county board of education; and the governing board of every special district heretofore or hereafter created by law.

In Attorney General Opinion JM-340 (1985), this office indicated that this definition comprises four parts. The first part describes the state-level governmental entities that are subject to the Open Meetings Act. The remaining three parts describe the specific local governmental entities that are subject to the act. For a local level entity to be a "governmental body" within the meaning of section 1(c) of the act it must be included expressly in one of the three specific descriptions of local governmental bodies. Attorney General Opinion JM-340; see Attorney General Opinion JM-183 (1984).

The Health Facilities Development Corporations at issue here are nonprofit public corporations created pursuant to article 1528j, V.T.C.S. The purpose of article 1528j is to enable cities, counties, and hospital districts to create corporations with the power to provide, expand, and improve health facilities to improve the adequacy, cost, and accessibility of health care, research, and education in Texas. Art. 1528j, § 1.02. Such corporations have extensive authority, including the authority to issue revenue bonds and notes, to accomplish these purposes. See id. § 4.01. An article 1528j corporation can be created only by a "sponsoring entity" - a city, county, or district as defined in the act. Each corporation must remain under the supervision of its sponsoring entity. Art. 1528j, § 4.01(14). Sponsoring entities cannot delegate to article 1528j corporations any sovereign powers of the state or of the sponsoring entity. See id. The corporations have only the powers authorized under article 1528j.

In Attorney General Opinion JM-596 (1986), this office addressed a similar question: whether nonprofit water supply corporations are subject to the Open Meetings Act. Like the corporations at issue in Attorney General Opinion JM-596, the corporations authorized by article 1528j are not entities within the executive or legislative branch of state government. Nor do they fit within the specific local governing entities listed in section 1(c) of the Open Meetings Act. Because an article 1528j corporation cannot exercise delegated governmental functions, it cannot reasonably be characterized as a "department, agency, or political subdivision" of its sponsoring entity, as those terms are used in the Open Meetings Act. See Attorney General Opinion JM-596; see also Attorney General Opinion JM-183 (1984). Nor is a nonprofit public corporation reasonably characterized as a "special district." A special district is a governmental entity, usually with taxing authority, created to provide special rather than general governmental services in a specific locality. See Black's Law Dictionary, 5th ed. Although both special districts and nonprofit public corporations often serve to bypass normal governmental borrowing limits, a nonprofit public corporation cannot ordinarily be characterized as a special district.

Of course, a public corporation's enabling statute may provide expressly that such corporations must comply with the Open Meetings Act. See Attorney General Opinion JM-120 (1983). Article 1528j does not, however, provide that Health Facilities Development Corporations must comply with the Open Meetings Act.

SUMMARY

A Health Facilities Development Corporation created pursuant to article 1528j, V.T.C.S., does not fall within the definition of a "governmental body" under section 1(c) of the Texas Open Meetings Act, article 6252-17, V.T.C.S., and therefore need not comply with the Open Meetings Act.

JIM MATTOX
Attorney General of Texas

MARY KELLER
Executive Assistant Attorney General

JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Jennifer Riggs
Assistant Attorney General