Could the Texas Board of Nurse Examiners use appropriated funds to buy liability insurance required to rent a site for a nursing examination?

Texas AG Opinion JM-625: Nurse Board Liability Insurance

Plain-English summary

The Board of Nurse Examiners selected sites for its February 1987 licensing examination. One facility required renters to carry liability insurance, so the board asked whether it could buy a policy in order to use that site.

JM-625 concluded that it could not use appropriated funds for the policy. Although state law authorized agencies to buy insurance against claims under the Texas Tort Claims Act, the current General Appropriations Act said, "None of the funds appropriated in this Act may be expended" to buy insurance covering those claims.

The opinion's summary was direct: "The Board of Nurse Examiners may not use appropriated funds to purchase liability insurance." Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1987/jm0625.pdf

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

Why did the board want liability insurance?

The owner of a facility chosen for a nursing examination required every renter to carry liability insurance. The board asked whether it could buy a policy to satisfy that rental condition. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1987/jm0625.pdf

Did state law generally authorize agencies to buy Tort Claims Act coverage?

The opinion said yes, citing Civil Practice and Remedies Code section 101.027. It then explained that the current appropriations act independently prohibited use of the appropriated money for that purpose. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1987/jm0625.pdf

Was the holding limited to appropriated funds?

Yes. Both the analysis and summary addressed whether the board could "use appropriated funds" to purchase the insurance. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1987/jm0625.pdf

Background and statutory framework

V.T.C.S. art. 4519 required the Board of Nurse Examiners to conduct licensing examinations in various Texas cities. The board therefore needed examination facilities in several locations.

JM-625 first stated the general rule that a state agency needed specific statutory authority to purchase liability insurance. It recognized statutory authority for Tort Claims Act coverage, but treated the General Appropriations Act's spending prohibition as controlling for the fiscal year at issue. The opinion also cited article 4527, which placed board fees in the state treasury for expenditure as specified by the appropriations act. Source: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1987/jm0625.pdf

Citations and references

Statutes:

• V.T.C.S. art. 4519
• Civil Practice and Remedies Code section 101.027
• General Appropriations Act, Acts 1985, 69th Legislature, chapter 980, article V, section 56, at V-62
• V.T.C.S. article 4527

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/jim-mattox/jm-0625
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1987/jm0625.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain; the linked PDF is authoritative.

January 26, 1987

Ms. Louise Sanders, R.N.
Acting Executive Secretary
Board of Nurse Examiners
1300 E. Anderson Lane
Building C, Suite 225
Austin, Texas 78752

Opinion No. JM-625

Re: Whether the Board of Nurse Examiners may expend funds for liability insurance required to rent convention center

Dear Ms. Sanders:

You have requested our opinion about the authority of the Board of Nurse Examiners to purchase liability insurance. The board is required to give the licensing examination for nurses in "various cities throughout the State." V.T.C.S. art. 4519. You have chosen several sites for the February 1987 examination. You explain, however, that the owner of one facility you would like to use requires that anyone who rents the facility must carry liability insurance. You ask whether the board may purchase liability insurance in order to rent the facility.

Specific statutory authority is necessary to authorize state agencies to purchase liability insurance. Attorney General Opinion H-1318 (1978). State agencies do have statutory authority to purchase insurance policies protecting against claims arising under the Tort Claims Act. Civ. Prac. and Rem. Code §101.027. However, the General Appropriation Bill for the current fiscal year contains the following provision:

None of the funds appropriated in this Act may be expended for the purpose of purchasing policies of insurance covering claims arising under the Texas Tort Claims Act.

General Appropriations Act, Acts 1985, 69th Leg., ch. 980, art. V, §56, at V-62. Therefore, the board may not use appropriated funds to purchase liability insurance in order to rent a convention center. Attorney General Opinions JM-551 (1986); M-1215 (1972); M-559 (1970). See also V.T.C.S. art. 4527 (fees received by Board of Nurse Examiners to be placed in state treasury to be expended as specified by Appropriations Act); General Appropriations Act, Acts 1985, 69th Leg., ch. 980, art. I, at I-137 (appropriation for Board of Nurse Examiners).

SUMMARY

The Board of Nurse Examiners may not use appropriated funds to purchase liability insurance.

JIM MATTOX
Attorney General of Texas

JACK HIGHTOWER
First Assistant Attorney General

MARY KELLER
Executive Assistant Attorney General

RICK GILPIN
Chairman, Opinion Committee

Prepared by Sarah Woelk
Assistant Attorney General