-E A'ITORNEYGENEEXAL OF TEXAS

February 25, 1953

Hon. G. F. Wllllam~ opinionHo. s-11. Firemen's Pension CornmIssioner 702 Tribune Building Austin, Texas Re: Eliglbilitgof the Texas MunicipalRetirement System

Dear Sir: to receive funds appropriated for the Firemen's Relief and RetirementFund. Reference 18 made to your request for an opinion which reada in part a8 follows:

"I have a board on which problem with a local pension

5 shall have to request your advice or ruling. It concernsa full-paid Fire Departmentwhose flremen have been participatingIn the State Firemen's Pension System since the beginnlng,when the Pension Law was enacted.

. . . "On September 16, 1952, I was notirled that they had transferred all of their funds to the MunicipalRetirementSystem on March 10, 1952. On September 11, 1952, they returned a State Warrant
. . . which had been mailed to the Secretary of the Firemen's Pension Board or their city. They requested that I change payee on the warrant rrom the 'Secretary, Firemen'sRelier and Retirement, to the 'Texas MunicipalRetirement System.'

. . . "I would appreciatevery much if you woul,d furnish me your ruling a8 to vhat authority I have to take action In the matter." Chapter 125, Acts or the 45th Legislature, Regular Session 1937, Page 229 (codifieda8 Article 6243e, V.C.S.) provided for the establishment of the Firemen's Reller and RetirementFund. Section 2 **of** Article 62~43e,

levied an occupationor license tax on Insurancecompanieswith the major portion of the funds received rrom this tax to be deposited In the Firemen's Relier and RetirementFund.Hon. G. F. Williams, p8ge 2 (S-11).

The tax on fir0 insurancepremluma van held unconstitutional

by American Alliance Ins. Co. v. Board of Ins. Com'rs., 126 S Y 2d 741 (Tex. Civ. App. 1939 error ref.) as vIolat& the due process and equal ' protectionirovlslons of the State and Federal Constitutionaand impinging on the powers and duties of the Board of Insurance Commiseloners. Since this holding, the Legislaturehas appropriated biennially from the General Revenue Fund to finance the FIremen's Relier and RetirementFund.

_

The Texas MunicipalRetirementSystem,,on the other hand, w&e set up by the Legislatureae a self-sustaining

agency. Acts Ch. 75, page 108. 70th Leg., R.S. 1947, Section 4(b 4 of Chapter 75 provlded: "The Legislature shall never make an appropriationto pay any of the cost 0r thle eyatem." However, Section 10 of the same act provided: "When the members of the Fire Department of a municipality

by their electionand with the consent of their employerbecome participants of this municipal system upon the voluntary applicationof the employingmunlclpallty&he Fih~dil:I1;~f,~an~~,-.oP~1thq 'Firemen's

Relief and RetirementFund' or such tinicipallty and all tuture payments to such Fund may be traneferredto the Board and credltedto its Prior Service Reserve Fund. "All distributionaamd paymentsvhlch could be made annually to a 'Firemen's Relief' and RetirementFund' for the rlremea of any. participating

municipality,ir the rlremen of such municipalitywere not coveredby this or 8ome other Pensloa or RetirementSystem or if such participating municipality

has or had taken the proper steps to 6ecure such funda, shall be paid over to the Board and credited for the benefits of such riremen as the Board shall direct." Section 4 and Section 10 of Chapter 75 were clearly conflictingIn nature. While providing that the Legislature should never appropriatefunds to pay any of the cost of the Texas MunicipalRetirement Sya&em, the act also provided that funds otherwisepayable to aBon. 0. F. Wllliame, page 3 (S-11).

FIremen Fund should be paid to the MunicipalRetlrement System.

The 51st Legislature. amended the above statute relating to the Municipal Retirement Syatem. In the amended act the prohibition again&t leglslatltieappropriationsto the Munlci $ al Retirement T stem was deleted. Acta 518t Leg., Article 624311, R.S. 19 9, Ch. 24, p. 2 (codifiedae

V.C.S.). The Legislaturein the 8ame act appropriated#jC,CCC.CCfor that lbyatem ba a loan. Section 10 relating to payment to the MunicipalRetlrement System of amounts from the Firemen'8Relief and RetirementFund va8 re-enactedby the Leglelatureas SectionXI of the amended act.

It 18 our opinion that SectionXX of Article 6243h, V.C.S., ineofar ae it concern8State~funda,Is uncon8tltutlonal

as it violatesArticle III, Section 511 of the State Constitution, vhich provides: *The Legislature of thla State shall have the authority to provide for a system of retirementand disabilitypeaslQti8 for appolntive officers and employee8 of cities and town8 to operate statevlde or by districts under such a plan and program a8 the Legislatureshall direct and shall provide that participation thereinby cltiea and towns shall be voluntary; provided that the Legislature shall never make an appropriationto pay any of the cost of any system authoricedby thle Section.'
Hence you would **not** be authorlzedto make a payment to the Municipal Retirement System from funds appropriated

by the Legislature for the Firemen'sRelief and RetirementFund.

SUMMARY

Under the fact8 submitted,the Flremen'8 Pension Comml88loner le not authorized to certify a payment to the MunicipalFioni G. F. Wllllams, page .!I (S-11).

Retirement System rrom the Firemen'6 Relief and RetirementFund appropriat Ion.

APPROVED: Yours very truly, Rudy G. R1c.e JOHNBEN SHEPPERD State Affairs Division Wlllis'Gre8ham Reviewer Robert S. Trotti First ASsiStant John Ben Shepperd Attorney General