’ 9 

. . 

Hon. Dorsey B. Hardeman, Chairman 

State Affairs Committee 

Senate of the State of Texas 

Austin; Texas 

Opinion NO. ww 640 

Dear Senator Hardeman: 

Re: Constitutionality of H.B. 

5, 56th Leg., relating 

to certification from 

the Comptroller required 

by Art. III, Set; &a of 

the Constitution. 

In your letter of May 27, 1959, you advised that 

the Senate State Affairs Committee, 56th Legislature, 

First Called Session, has referred House Bill 5 to this 

office for an opinion on its constitutionality. 

Section 1 of House Bill 5 provides as .follows: 

“In preparing the financial statements and certifications required by ,~: 

Article III, Section 49a of the State 

Constitution, the Comptroller of Public 

Accounts shall report and consider an 

estimate of the probable receipts and disbursements as of August 3lst for the then 

current fiscal year. 

"The words 'probable receipts' shall 

mean knd include all such moneys estimated 

by the Comptroller to be received by the 

State through August 31st of the then 

current fiscal year; and his financial 

statements shall show~the fund or funds 

to which such receipts are to be credited. 

"The words 'probable disbursements' 

shall mean, and the Comptroller shall consider and report under such term, only 

those payments estimated to be made and 

warrants which will be issued by the State 

through August 31st of the then current 

fiscal year. 
., 

Hon. Dorsey B. Hardeman, page 2 (~-640) 

"In addition thereto, for the information of the Governor and the Legislature 

the Comptroller shall list other outstanding appropriations which may exist after 

the end of the then current fiscal year, 

but they shall not be deducted from the 

cash condition of the Treasury or the 

anticipatedexthe biennium 

for the purpose of certification. In estimating and certifying cash funds to be 

available for the next biennium, these 

outstanding but undlsbursed appropriations 

of each biennium shall be offset by the 

estimated total of outstanding but undisbursed appropriations of the succeeding 

biennium. 

"It is the Legislative intent that the 

Comptroller's reports, estimates, and certifications of available funds In each instance 

shall be based upon the actual or estimated 

cash condition of the State Treasury and that 

outstanding and undisbursed appropriations 

at the end of each biennium shall be considered 

as probable disbursements of the succeeding 

biennium in the same manner that earned but 

uncollected income of a' current biennium is 

considered in probable receipts of the succeeding biennium. The provisions of this Act shall 

be immediately effective and the Comptroller 

shall revise his current report and estimates 

in accordance therewith." (Emphasis added) 

Section @a, Article III of the Texas ConStltutiOn, 

provides in part as follows: 

"It shall be the duty of the Comptroller 

of Public Accounts In advance of each Regular 

Session of the Legislature to prepare and 

submit to the Governor and to the Legislature 

upon its convening a statement under oath 

showing fully the financial condition of the 

State Treasury at the close of the last fiscal 

period and -.~-- an estimate of the probable receipts 

and disbursements for the then -- current fiscal 

SYJ??E- ----There shall also be contained in said 

statement an itemized estimates of ~ the anticipated 

FeEuxsed -. ~.--~ on the lawsenineffect that 

will be received by-and for the State from 

aEou%-es __~~_~I_ -.-. showing -.-.. the fund accounts to be 

credited during the succeeding biennium and 
Hon. Dorsey B. Hardeman, page 3 (~~-640) 

said statement shall contain such other 

information as may be required by law, 

Supplemental statements shall be submitted at any Special Session of the 

Legislature and at such other times as 

may be necessary to show probable 

changes. 

"From and after January 1, 1945, save 

in the case of emergency and imperative 

public necessity and with a four-fifths 

vote of the total membership of each House, 

no appropriation in excess of the cash and 

anticipatedvenue of the funds from which 

such aoorouriation is to be ma= shall be 

valid.‘* From and after January 1, 1945, no 

bill containing an appropriati~on shall beg 

considered as passed or be sent to then 

Governor for consideration until and unless 

the Comptroller of Public Accounts endorses ~ 

his certificate thereonshowing that the 

amount appropriated is within the amount 

estimated to be available in the affected 

funds. When the Comptroller finds an appropriation bill exceeds the estimated revenue 

he shall endorse such finding thereon and 

return to the House in which same originated. 

Such information shall be immediately made 

known to both the House of Representatives 

and the Senate and the necessary steps shall 

be taken to bring such appropriation to 

within the revenue either by providing additional revenue or reducing the appropriation. 

"For the purpose of financing the outstanding'obligations of the General Revenue 

Fund of the State and placing its current 

accounts on a cash basis the Legislature of 

the State of Texas is hereby authorized to 

provide for the issuance, sale, and retirement of serial bonds, equal in principal 

to the total outstanding, valid and approved 

obligations owing by said fund on September 

1, 1943, provided such bonds shall not draw 

interest in excess of two (2) per cent per 

annum and shall mature within twenty 

years from.date. 

(20) 

Added Nov. 3, 1942.' 

(Emphasis added) 
Hon. Dorsey B. Hardeman, page 4 (~~-640) 

From the foregoing it is seen that Section @a of 

Article III requires of the Comptroller two different 

types of duties. First, he is required to prepare for 

the Governor and the Legislature a financial report of 

the condition of the State Treasury and to prepare an 

"estimate" which is to show the Information specified 

in the Constitution, and other such matters as the 

Legislature may require. Insofar as House Bill 5 is a 

specification of the form and content of those reports, 

it does not violate the Constitution. Certainly the 

Legislature may require any information that it desires, 

and it may require that information to be shown in any 

manner that it desires, regardless of whether the 

Comptroller believes such is necessary to an accurate 

accounting procedure. 

Second, the Comptroller is to certify that the 

amount appropriated in any bill~is within the amount 

estimated to be available in the affected funds. 

The Comptroller's determination of the availability of funds appropriated is not required by the 

Constitution to be based on his financial report of 

the State Treasury prepared for the Governor and the 

Legislature or his "estimate'. The word "estimated" 

as used in connection with the certification to be 

made by the Comptroller necessarily refers to a finding or opinion of the Comptroller separate and apart 

from the "estimate" ulhich is referred to in the first 

paragraph of~Section @a. That Yestimate" -- the document prepared and published by the Comptroller at the 

beginning of each legislative session -- relates to 

the contemplated revenues to be received by the State 

during the succeeding biennium under the statutes in 

existence at the time the Legislature meets. The 

Comptroller could not determine the availability of 

subsequently appropriated funds based upon that "estimate" alone, because it would not necessarily take all 

anticipated disbursements into account, and would not 

be based upon revenue and other bills passed at the 

same legislative session before a bill containing an 

appropriation was sent to him for certification. In 

this connection, we point out that statutes may be 

passed which affect the availability of funds to be 

appropriated, but which are not revenue bills and 

which do not contain an appropriation. (See Attorney 

General's Opinions WW-102 (1957), and ~~-632 (1959), 

copies of which are attached). The "estimate" prepared for the Governor and the Legislature might not 
. ‘. 

. . 

Hon. Dorsey B. Hardeman, page 5 (~~-640) 

have taken such bills into account. Patently the 

question of availability demands a consideration by 

the Comptroller of facts which are not or may not 

be reflected in the pre-legislative session "estimate". 

I 

Of course, the Comptroller of Public Accounts, 

in making his "estimate" as to the amount of money that 

will be available in the affected funds, in certifying 

an appropriation bill or returning it to the,House in 

which same originated, should by virtue of the mandate 

of Section @a of Article III of the Constitution, take 

into consideration every element that bears upon the 

amount of funds that will be available, Including an 

estimate of the amount of funds that will not be expended under the appropriations for the present 

biennium, as well as an estimate of the amount of funds 

that will not be disbursed by virtue of appropriations 

made for the next biennium. 

The Constitution does not expressly,provide whether 

the general accounting method should be on a cash or 

accrual basis, but there is some language in Section 

@a of Article III, Texas Constitution, which would 

seem to require the accounting to be on a cash basis. 

It is our opinion that the Legislature may direct the 

Comptroller to employ a cash accounting basis as supplemental to and inaid of the constitutional provisions 

and we do not pass upon whether the Legislature could 

require the use of an accrual accounting basis. In 

Hamilton v. Deland, 198 N.W. 843, the rule was stated 

as follows: 

"While legislation may not be necessary to 

effectuate the constitutional provision and 

none may be validly enacted that Is In conflict with it, it does not follow that legislation supplemental to and In aid of the constitutional provision may not be enacted. 

This, I think, is settled by the text-writers 

and adjudicated cases." 

In support of this rule the Court quoted from Corpus Juris; 

Ruling Case Law and the 7th Edition of Cooley's Constitutional Limitations. 
. . 

.- 

Hon. Dorsey B. Rardeman, page 6 (W-640) 

H. B. No. 5 In effect Instructs the Comptroller 

to use the cash accounting basis, as it provides that 

outstanding appropriations which may exist after the 

end of the then fiscal year should not be deducted 

from the cash condition of the Treasury or the antlcipated revenue of the next biennium for the purpose of 

certification. This we believe to be constitutional. 

However, the bill now provides that the outstanding 

but undisbursed appropriations of each biennium shall 

be offset by the estimated total of outstanding but 

undisbursed appropriations of the succeeding biennium. 

This we believe to be unconstitutional. 

Reading Section &a of Article III from its four 

corners, it is our opinion that this constitutlonal 

provision contemplates that the Comptroller, in making 

his estimate for certification of bills, use the cash 

accounting method. The use of the underscored language 

in the Constitutional Amendment, as quoted above, 

strengthens our opinion that the amendment in question 

contemplates that the accounting'.method to be.employed 

by the Comptroller In making his estimates should be on 

the cash basis. 

In H; B. No. 5 It appears that the Legislature Is 

estimating that the outstanding but undisbursed appropriations at the end of each biennium will be in the 

same amounts as it states that one will offset the other. 

However, Section &a of Article III of the Constitution 

provides that the Comptroller will make the estimates. 

Insofar as this bill attempts to make estimates it is 

unconstitutional as a legislative invasion of the duties 

of the Comptroller. However, if a severability clause 

is added, the remainder of the bill will stand, as it 

does not conflict with Section &a of Article III of 

the Constitution but is supplemental to and In aid of 

the Constitutional provisions. 

Other than the questions treated above, we find 

no constitutional questions raised by House Bill 5. 

SUMMARY 

House Bill No. 5 is a constitutional bill 

except Insofar as it attempts to make estimates as to outstanding but undisbursed 

appropriations. For that reason as present- 
Hon. Dorsey 5. Hardeman, page 7 (IN-W-640) 

ly drafted it is unconstitutional. If 

a severability clause be added, the remainder will be effective, as the bill 

is complete and workable after eliminating the unconstitutional provision. 

Very truly yours 

WILL WILSON 

Attorney General of Texas 

APPROVED: 

OPINION COMMITTEE: 

George P. Blackburn, Chairman 

Martin DeStefano 

Joe Osborn 

Mrs. Marietta Payne 

REVIEWED FOR THE ATTORNEY GENERAL 

By: W. V. Geppert