Texas Attorney General Opinion: DM-99 Page: 3 of 4
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Mr. James L Pledger - Page 3
Recovery and Enforcement Act of 1989, and that federal and state law now
authorize federal savings associations and state savings and loan associations to
accept demand deposits from any person, see 12 U.S.C. 1464(b); 12 C.F.R.
545.12; see also V.T.C.S. art. 852a, 5.05 (providing that a state savings and loan
association may engage in any activity that is permissible for a federal savings and
loan association). You also assert that a federal court has "recognized that a savings
and loan association chartered in Texas is the functional equivalent of a Texas state
bank," citing State of Texas v. Clarke, 690 F. Supp. 573 (W.D. Tex. 1988).3
In 1982, this office considered an argument almost identical to the one
asserted here. In Attorney General Opinion MW-534, the requestor contended that
"recent changes in laws governing savings and loan associations... might affect
prior opinions of this office regarding the eligibility of such associations.., .to serve
as county depositories." Attorney General Opinion MW-534 at 2. We rejected this
argument, holding that
[a]lthough these changes provide the authority for... savings
and loan associations to perform some of the same functions as
banks, this alone does not provide the... requisite statutory
authority that would permit them to serve as county depositories
within the ambit of articles 2544 through 2558a, V.T.C.S. [the
predecessor statutes to chapter 116 of the Local Government
Code].
Id. As is clear from the foregoing, our prior opinions rely on the fundamental
prindple that express legislative authorization is necessary to allow governmental
entities to deposit funds in savings and loan associations. Since 1982, the Texas
legislature has not seen fit to amend the applicable provisions of the Local
Government Code or the Education Code to authorize municipalities, counties,
school districts and institutions of higher learning to deposit funds in savings and
loan associations.4 Recent changes in statutes and regulations governing savings
3Another brief submitted in support of the Savings and Loan Department's position suggests
that the Texas Savings and Loan Act, V.T.C.S. art. 852a, 6.14, authorizes governmental entities to
deposit funds in savings and loan associations. In Attorney General Opinion H-723, this office held
that that provision, standing alone, does not give any political subdivision the authority "to make
investments unaffected by legal restrictions found elsewhere in the law of this State." Attorney General
Opinion H-723 at 4; see also Attorney General Opinion MW-534.
4Indeed, a recent attempt to pass such legislation failed. See H.B. 1572, 72d Leg. (1991)
(would have amended Local Government Code, chapter 105, to change the definition of the termp. 503
(DM- 9 9)
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Texas. Attorney-General's Office. Texas Attorney General Opinion: DM-99, text, March 30, 1992; (https://texashistory.unt.edu/ark:/67531/metapth273908/m1/3/?q=Lamar+University: accessed June 10, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting UNT Libraries Government Documents Department.