Honorable J. M. Falkner

Chalrman,Finance Commission Departmentof Banking Austin 14, Tex?s Opinion No. C-88

Dear Mr. Falknert Re: Whether fees and monies collectedana received by the RegulatoryLoan Commissionerare to'be held outside the State Treasury or trani3mltted to the State Treasurer to be placed In the Qeneral Revenue puna.

Your request for an opinion on the above subject matter poses the following question:

"The que%tion to be aeciaea'is whetherunder the provisions of the Act penate Bill 15, Acts of the 58th Legislature,

Regular Session,known
as the 'TexasRegulatoryLoan Act'-/ hereafterreferred to, such fees Xnd monies when collectedand received by the RegulatoryLoan Commissionershall be placed In a separatefund to be used by the Commissionerfor the enforcementof the Act under the dire+ tlon of The Finance Commissionof Texas
or whether such monles should be transmitted by the Commissionerto,the State Treasurer to be placed In the General Revenue Fund."

Senate Bill 15, Acts of the 58th Legislakre, Regular Sessioni I,s

an Act to classify loans and lenders and pr;;;;; for their regulation. We quote the followingprotertinent to your question. Section provides: Subalvislon (a) of

_

-427-Hon. J. M. Falkner, page 2 

### (C-88)

“There is **hereby** created the offlce of Regulatory Loan Commlsaloner of the State of Texas. The oommlaal6ner ehall be appointed by the Flnanoe Commllsslon and shall serve at the pleasure of the Fliianoe Cbmmlselon. The oommlal3loner shall be an employee of the Flnknoe Commikwlon, subject to It8 order6 and dlreotlons. **The commlealoner**  Is authorised to appoint and remove examiners and employeea, and to preeorlbe the dutlea of eaoh. I’
8ubdlvlrlon (b) of 

### Seotlon 4 provider!

9ha oommlrrlonrr &all, from tlmb to time, a8 dlreoted by the **binmoo Oom**  

### mlrrlon, rubmlt to the Blnanoa 

### Oonunlrrlon (L Pull and oomplete report of thr rroriptr 

### and racpendltures of this officei 

### and the 

### binanob **0omml8rlon**

### may, from time to time, oataaln~ the flnanolal 

### reobrda of the Rogu- .latory 

### Loan Oommlooloner, or **pauue** them to bb 

### bammlnrd, In addition, the oifioe **of Rbgulrtory**  Loan Oommirlrloner Wall bb Wdltbd from time to tlme by thb &bate auditor In thb ILmb manner as mtatb dbp*rtmentr, and the aotual oostn 

### of ruoh audit shall 

### bb paid 

### t0 the Itate audltor f ’r?Om s 

### Wiz;rda **of thb**  **Regulatdry LOan**  

### OonnnirThe Flaanob Oommlrrion 

### rhal2, aa of Dbo;mt5er31, 

### 1963, end anmA thbPb**aftbr** report **to thb**  Oovbrnor oi t b 3: Statb oi Qeacan,

the rboelptr,



### and di~biWbIUbkltlr.

Of tbcHlob of 

### the Regulatory Loan 

### Oomlr~ alonbr for **eaoh** oalmdar yew.”
8ubdlvlrlon (b) of 

### Seotlon 8 

### provider8

“If the oommlesloner rhall not 80 find

’

annual fee shall 

### be returned 

### to the **appll**

**oant** In **the event**  **of** denial.”Ron. J. M. Falkner, Pa@ 3 (C-88)
fSubdivision (a) of Section 12 provides:

"At least once each year and at such other times as the commissionershall deem necessary,the commissioner, or his duly authorizedrepresentativeshallmake an examinationof the place of business bf each licenseeand shall Inquire Into and examine the loans, transactions, books, accounts,papers, correspondence, 

### ana records of such licensee Insofar as they pertain to the businessregulated'bythis Act.'Ifi

the course of such examination,the commissioneror his duly authorizedrepresentative shall have free access to the office, places of buslness,files, safes and vaults of such licensees,and shall have the right to make boples of such books, accounts, 9a9ers, correspondence and records. The commissioneror his duly authorizedrepresentativemay, during the course of such examination,administeroaths and examine any person under oath upon any subject pertinent to any matter about which the commissioner is authorizedor required by this Act to consider, Investigate,or secure lnformation. Any licenseewho shall fall or refuse to let the commissioneror his duly authorizedrepresentative examine or make copies of such books, or other relevant documents shall therebybe deemed in violation of this Act and such failure 6r refusal shall constituteground8 for the suspension
or revocationof such license. The lnformatlon obtained In the course of such examlnation shall be confldentlal. Each'llcensee shall pay to the commissionerthe cost of the examination,

but not to exceed Fifty Dollars ($50)per day per examiner and the total cost of examinationsassessed and charged a licensee In any one calendaryear shall not exceed Two Hundred Fifty Dollars ($240) for eacfi

llcentiea

office."

Other provisionsauthorize the RegulatoryLOap Commlsaloner to assess certain fees or charges on llceneees provided for In the Act.

-429-Hon. J.. M. Falkner,page 4 (C-88) -

A careful study of all the provisionsof the Act reveals that nowhere In the Act Is the RegulatoryLoan Commissioner nor anyone else directed tb deposit any fee or charge or any sum of money In the State Treasury to the deposit of any particularfund. On the contrary,we find language that "The Investigation fee shall be retained by the ~ommlssloner,

but the annual fee.shallbe returned to the applicant In the event of denial." 'If monies recelved by the Commissioner were to be deposited In the Treasury, the annual fee could not be returned to the applicant In the event of denial, as provided In subdlvlslon (b) of Section 8 of Senate Bill 15, since no money can be drawn from the Treasury,but In pursuanceof specificapproprl&- tlonsmade by law. Section 6 of ArticleVIII of the Constltutlon of Texas; Pickle v. Finley, 91 Tex. 484, 44 S.W. 480 $;zg); Llghtfootv. Lane, 104 Tex. 447, 140 S.W. 89 (1911);

. nyder, bb Tex. 687, 18 S.W. 106 (1886). Furthermore, no duty ls~lmposedby the provlslonsof Senate Bill 15 on the Comptrollerof Public Accountsor the State Treasurer to accept fees for deposit.

Under subdivision (b) of Section 4, above quoted, the CommissionerIs required to make a full and complete report of the receipts and expenditures of his office. The State Audltoi;

Is required to audit his office from time to time and "the actual costs of such audit shall be paid to the state auditor from the funds of the RegulatoryLoan Commlssloner." The provisionsof subdivision (b) of Section 4 of Senate Bill 15 are similar to the provisions contained In Article 342-112,Vernon's Civil Statutes,with the exceptionof the provision that the revenues shall be paid into the GeneralRevenue Fund of the State and ,the provision that the expenses Incurred shall never be a charge against the funds of the State.

It has been held on numerous occasionsby this office that the expenses of the Banking Departmentare paid out of fees, penalties and reyenues collectedby the Department and the dlspoeltlo provlalona

### of Article E of such monies Is governedby the 3 2-112,Vernon's Civil Statutes.

In Attorney Oeneral~sOpinionWW-725 (i959),

### It was stated:

"It Is noted that such funds axe required to be retained and held by the Banklng Department. The Banking DepartmentIs further authorized to expend,suchfunds for the payment of expenses of the Department."

-430-Hon. J. M. Falkner,page 5 ‘(C-88) P

In Attorney General'sOpinion ww-608 (1959), it Departmentfunds held that the expenditureof Banking could not be made by the State Building Commlsslonand that any contract entered Into for the constructionof office space of the Banking Departmentwould have to be executedby that agency.

In Attorney General'sOpinionW-500 (1958), It was held that the Finance Commission may, under the provisions of Article 342-112, authorize the expenditureof money for costs and other expenses Incurredby the State Banking Board In the trial of a case brought under the provisionsof Artlcle $2-115, Vernon's Civil Statutes.

In Attorney General'sOpinionWW-1095 (1961), It
was held that In view of the provisionsof Article 342-112, that the Position Classiflcatlon Plan, establishedby the Position Classlflcatlon Act of 1961, does not apply to the Finance Commission.

It Is noted that the disbursement under Article 342" ,112 by the Banking Department Is directly contrary to the dispositionof fees under Article 363, Vernon's Civil Statutes, which provides:

"All sums collectedas examination fees shall be paid by the.Commlsslonerdlrectly to the State treasury to the credit of the General Revenue Fund. Expenses of examinationand of the CommissionerIn enforcing the provisions of this title shall be paid upon the certificateof the Commlssloner by warrant of the Comptroller upon the State treasury."

See Attorney General'sOpinion No. O-3928 (1941).

In view of the duties lmposeaupon the Regulatory Loan Commissioner,the Finance Commissionand the State Auditor, It Is our opinion that fees and monies collectedby the Regulatory Loan Commissionershall be retainedby him and expended forthe purpose&of the enforcementof the provisions of Senate Bill 15, Acts of the 58th Legislature,Regular Session, under the directionof the Finance Commissionof Texas,
as provided In Senate Bill 15. You are further advised that such monies cannot be transmittedto the State Treasurer and
are not subject to appropriation by the Legislature.

"431"Hon. J. M. Falkner, Page 6 (C-88)

SUMMARY

Monies collectedpursuant to the provisions of Senate Bill 15, Acts of,the 9th LegIslature,Regular Session,known as the Texas RegulatoryLoan Act" shall be retainedby the RegulatoryLoan Commissionerto be used by the CommissionerIn the enforcementof the provisionsof Senate Bill 15, under the directionof the Finance Commissionof Texas,
as provided for In Senate Bill 15, and such monies are not subject to appropriation by the Legislature.

Yours very truly,

WAGGONER CARR Attorney General

JR:ms APPR(ylED:

‘

OPINION COMMITI'EE W. V. Geppert, Chairman

Albert P. Jones J. C. Davis GilbertHargrave Scott Garrison 

# By

John Reeves Assistant

APPROVEDFOR THEATTORNEXGENERAL Bs: Stanton Stone

-432"