OF TEXAS 

AURTIN. Tmcxas 78711 -. .I_ 

February 25, 1977 Orern~!nr C)J!rii 

The Honorable Bob Bullock Opinion No. H-947 

Comptroller of Public Accounts 

State of Texas He: Transfer of funds 

104 L.B.J. State Office Bldg. by ~the Comptroller 

Austin, Texas 78711 

Dear Mr. Bullock: 

You have requested our opinion concerning your authority 

to transfer funds from the General Fund to the Department of 

Public Welfare's Commodity Distribution Fund pursuant to 

section 3 of article 5 of the 1973 Appropriations Act. Acts 

1973, 63rd Leg., ch. 659 at 2197. 

That section provides: 

In each instance in which an operating fund 

or account is created by the provisions of 

this Act, the responsible officials of the 

State are authorized to transfer into such 

operating fund or account sufficient moneys 

from local funds and Federal grants of funds 

to pay proportionally the costs of matching 

State employees retirement contributions, the 

State's share of Old Age and Survivors 

Insurance and the proportionate cost of 

premiums of policies containing Group Life, 

Health, Hospital, Surgical, and/or Medical 

Expense Insurance for retired employees and 

officials. 

This language has been contained in each appropriations 

act since 1969. In Attorney General Opinion M-1173 (1972), 

this office ruled that section 3 constituted an authorization 

for the Comptroller to transfer funds to the State Law Library. 

The opinion states that such a transfer could include: 

P. 3958 
The Honorable Bob Bullock - page 2 (H-947) 

the matching funds appropriated from the 

general revenue fund by the provisions of 

section 3 of Article V . . . . Id. at 5. 

It is not clear whether section 3 was construed to constitute 

an open-ended appropriation or whether it merely authorized 

a transfer of general revenue funds for the State's contribution for employees who are paid from the General Fund. 

Admittedly, the language quoted above would seem consistent 

with the former construction. However, article 5, section 3 

authorizes the transfer of only "local funds and Federal 

grants." Since Opinion M-1173 discussed neither the definition 

of "local funds" nor the pertinent general law, its analysis 

is insufficient to answer the present inquiry. 

The legislation pertaining to the payment of the State's 

contributions to the Retirement System, Old Age and Survivor's 

Insurance (OASI), and insurance for retirees requires that 

such payments be made from the "respective funds appropriated 

. . . to pay the salary . . .of the member for whose benefit 

the contribution is made." V.T.C.S. art. 6228a, 5 8A. See 

V.T.C.S. art. 695h, S 5, 6(b)(l); Ins. Code art. 3.50-2,F 

15(b). The Appropriations Act of 1973 implemented this 

legislation by making separate appropriations from the 

respective funds for each of the three contributions. Acts 

1973, 63rd Leg., ch. 659, art. II at 1866; art. III at 1953-54. 

In our understanding, these contributions are either drawn 

by the Retirement System directly from the respective fund 

from which the particular salaries are paid or from an 

operating fund into which such funds have been transferred. 

See Acts 1973, 63rd Leg., ch. 659, art. III at 1919-20, 

which creates an Attorney General's Operating Fund and 

transfers moneys thereto from fourteen special funds. Where 

such an operating fund is utilized, the salaries paid therefrom 

are actually being paid from the funds which have constituted 

the operating fund; the consolidation of such funds is for 

convenience. Accordingly, the general law and the appropriations 

act require the subject contributions to be made from the 

funds from which the operating fund is constituted. These 

contributions could be drawn directly from the various funds 

by the Retirement System; however, for administrative convenience 

the Retirement System may require the proportionate contribution 

from each fund to be transferred to the operating account 

from which the salaries are finally drawn. V.T.C.S., art. 

6228a, 5 6A(b)6; Ins. Code art. 3.50-2, 9 4; V.T.C.S. art. 

695h. 5 7. 

P. 3959 
The Honorable Bob Bullock - page 3 (H-947) 

Thus the Legislature has created a system by which 

money is appropriated from each fund to pay the contributions 

for employees whose salaries are paid therefrom. Your 

question involves the transfer of general revenue funds 

into a special fund for the purpose of paying such fund's 

proportionate share of the State's contributions. We note 

that most of the Commodity Distribution Fund consists of 

moneys appropriated from the General Revenue Fund for 

financing the State's Food Stamp program. Acts 1973, 63rd 

Leg., ch. 659, art. II at 1857; see Rider 25, Id. at 1863. 

As we discussed above, the State'scontributions for employees 

paid from the appropriation from General Revenue should be 

financed therefrom in the proportion that such appropriation 

is utilized to pay the salaries of such employees. Any 

transfers necessary to this transaction are made pursuant to 

the requirements of the Retirement System. We will therefore 

address the application of other provisions to transfers from 

General Revenue other than those necessary to the above 

described transaction. 

Article 5, section 3 of the 1973 Appropriations Act, 

reproduced in part above, authorizes the transfer of "local 

funds and Federal grants" into an operating fund for payment 

of the subject contributions. Thus this transfer was 

authorized thereby only if the General Fund is a local fund 

or federal grant. We do not believe the Legislature intended 

it to be so characterized. Article 4, section 20 of the 

Appropriations Act contains the language "regardless of 

whether said appropriation items are General Revenue or 

local funds in character . . . .' Acts 1973, 63rd Leg., 

ch. 659, art. IV at 2150. Clearly, a distinction is drawn 

between local funds and the General Fund. In addition, 

article 5, section 31 of the Appropriations Act provides in 

part: 

In the event the amounts of Federal funds, 

local funds, or funds other than appropriations from the General Revenue Fund, have been 

estimated in this Act in sumsgreater than 

are actually received by the respective 

agencies of the State, this Act shall not 

be construed as appropriating additional 

funds from General Revenue to make up such 

differences. Acts 1973, 63rd Leg., ch. 659, 

art. V at 2211. 

P. 3960 
. . 

The Honorable Bob Bullock - page 4 (H-947) 

Once again, a clear distinction was drawn between federal 

and local funds and the General Revenue Fund. See also -- 

"Method of Financing" for Department of Public Welfare, Acts 

1975, 64th Leg., ch. 743, art. II at 2491. 

Accordingly, in our opinion article 5, section 3 did 

not authorize a transfer of General Revenue Funds to the 

Commodity Distribution Fund, since the General Revenue Fund 

is not a local or federal fund. Attorney General Opinion 

M-1173 is hereby overruled to the extent of conflict. Since 

the Legislature has elsewhere provided for the State's 

contributions for employees paid from special and general 

funds, it appears that section 3 was intended to provide 

for the transfer of funds to pay "proportionally" the 

State's contributions for employees paid from local funds 

and federal funds, for these contributions were not provided 

by the specific appropriation for the three contributions. 

Our attention has been directed to article 695c, section 

4(12), V.T.C.S., which provides in part: 

The State Department of Public Welfare is 

authorized to accept, expend, and transfer 

any and all Federal and State funds appropriated 

for such purposes. 

As we decided in Attorney General Opinion H-679 (1975), this 

provision authorizes the transfer of appropriated funds. 

However, the Legislature did not appropriate these funds 

to the Department of Public Welfare, and thus article 695c 

did not authorize their transfer. 

SUMMARY 

Article 5, section 3 of the 1973 

Appropriations Act did not authorize the 

transfer of General Revenue Funds to the 

Department of Public Welfare's Commodity 

Distribution Fund. Such a transfer may 

be made pursuant to the requirements of 

the Retirement System where the transferred 

P. 3961 
The Honorable Bob Bullock - page 5 (H-947) 

funds are used to pay the State's 

to OASI, retirement and insurance 

contributions 

for 

employees paid from appropriations from 

General Fund. 

Very truly yours, 

APPROVED: 

Attorney General of 

Opinion Committee 

jwb 

the 

Texas 

P. 3962