June 1, 1949

Han, Ray Kirkpatrick, Chairman House Appropriations Conunittee 51st Legislature Austin, Texas Opinion No. V-839

Re: The necessity for enabling legislation to make the 1% transfer ::. from the permanent school fund under Art. 7, Sec. 5, Constitution.

Dear Sir:

Pursuant to the request of,the House Appropriations Committee you have submitted to this office the following questions:

“Has an enabling a,ctever been passed

concerning Article VII. Section 5, Constitution ofTexas; ifnot, is one necessary to transfer annually 1% ofthe permanent school fund to the available school fund. “Msy atransfer from the permanent school fund tothe available school fund of 1% be affected by a rider on ageneral appropriation bill or would it require special legislation? ”

Section 5ofArticle VU, Constitution ofTexas, insofar
as pertinent to the submitted inquiries, reads as follows:

“The principal of all bonds and other funds, and the principal arising from the sale ofthe lands hereinbefore set apart to said school fund, shall be the permanent school fund, and all the interest derivable therefrom and the taxes herein authorized and levied shall be the available school fund, towhich the Leais~lature may add not exceedinn one per cent annually of the total value ofthe permanent school fund. such value toHon. Ray Kirkpatrick, Page 2. (V-83,9)

be ascertained by the Board ofEducation until otherwise provided by law, and the available school fund shall be applied annually to the support ofthe public free schools. D0n(Underscoie ours)

The Texas Constitution of 1876 contained the above provisions except those words underscored, they were added by adoption of a constitutional ame~ndment. The amendment was adopted at an election held inAugust, 1891, pursuant toJoint Resolution No. 19, 22nd Legislature, R.S. page 195, Acts 1891. 10Gamme1 Laws 197.

Immediately following the adoption ofthis Amendment, the 22nd Legislature in called session enacted H.B. 14ofActs 1892, 1st C.S., dh. 9, p. 8 (10Gammel Laws 372), carrying into effect the amendment toArticle VII, Section 5, transferring annually one per cent ofthe permanent to the available school fund. This Act reads inpart as follows:

“Section 1. Be it enacted by the Leg,islature of the State ofTexas: That one per cent ofthe full value ofwhat is known, held and controlled by the State ofTexas, as the permanent school fund, shall be transferred annually hereafter to the credit ofthe available school fund ofthe state, as belonging to:it, and apart ofthe same, andwhich henceforward shall constitute a part of the state’s available school fund and to be used and applied for the support, maintenance and benefit ofthe public free schools of the state, as now or hereafter may be provided by law.

“Sec. 2. Be itfurther enacted: It shall be the duty ofthe comptroller and the state treasurer to notify the state board ofeducation of the amount to the credit ofthe permanent school fund on the first to the fifteenth day of July ofeach and every year. The said statement shall show the amount invested, inbonds, the amount of outstanding land notes, and the amount of cash onhand to the credit ofthe permanent school fund. Upon the receipt ofthis information the state board ofeducation shall estimate one per cent ofthe said permanent school fund and shall issue directions to the said comptroller apd state treasurer to transfer the one per centHon. Ray Kirkpatrick, Page 3. (V-839,)

ofthe permanent fund thus~found to,the credit ofthe available school fund.

“Sec. 3. Be itfurther enacted: That it shall be the duty ofthe state comptroller and state treasurer, upon the receipt and delivery to them, by said board ofeducation, of the showing and statement aforesaid, as set forth in section 2 ofthis act, to transfer and place to the credit ofthe available school fund of the state the amount found and ascertained by said board of education, as aforesaid, and accruing from the one per cent of the value ofthe permanent school fund, and transferred to the available school fund under section 1st of this act. Provided that no part ofthe value thereof, ofthe unsold public land belonging to said fund shall be included or considered by the comptroller.and state treasurer in ascertaining the amount to be transferred from the permanent to the available free school fund.

“Sec. 4. Be it further enacted: That it shall be the duty ofthe state board ofeducation and comptroller, inthe management and investment ofthe permanent school fund, to provide,
reserve and set apart in cash, annually, an amount sufficient of same tomeet the one per cent annual transfer tothe available fund.”

These quoted provisions were incorporated by the 23rd Legislature in its comprehensive enactment to provide for amore efficient system ofpublic free schools. Section 9(a) through (d), Acts 1893, Ch. l22, p. 182; 10Gammel Laws 612, 615. That section and its subdivisions were codified in Chapter 7ofTitle LXXXVI of Revised Statutes, 1895, as Articles 3897 to 3901, inclusive.

In 1905, however, the 29th Legislature at its Regular Session, enacted S.B. 218 (Acts 1905. Ch. 124,,p. 263), to provide for a complete system ofpublic free schools inTexas. Section 179 of this Act provided that “all provisions of Chapter 7

. q0Title LXXXVI of R.S. 1895 and all amendments thereto not herein specifically reenacted are hereby repealed. D.* Only Article 3897, R.S. 1895, was reenacted inSe&ion 10of the Acts 1905, which was subsequently codified inRevised Statutes, 1911,as Article 2725, and reads as follows:

“Besides other available school funds provided by law. one-fourth of all occupation taxes and one dollar poll tax levied and collected forHon. Ray Kirkpatrick, Page 4 (V-839)

the u6e ofpublic free school& exclurive of the delinquencies.and cost **of** collection, the 

### interest arising from any bonds or funds be

### longing tothepermanent 

### achoolfund;‘aqd all 

### theintereat derivable 

### from the proueeds of sales 

### oflandheretofore setapart for the permanent school fund, which have h&herto,
**or** may hereafter, come into the state treasury, all moneys arising from the lease of school lands, and such an amount 

### of state tax, not to exceed twenty cents onthe one hundred dollars -valuation ofproperty, as may be, from time to time, levied by the legislature. shall constitute the available school fund, which fund shall be apportioned annually to the several counties ofthis state, according to the scholastic population ofeach, for the support and 

### maintenance ofthe public free schools.”

Article 2725, R.S. 1911,is codified as Article 2823 in R.C.S., 1925, substantially unchanged except that such Article 2725 read “not to exceed twenty cents on the one hundred dollars valuation.. and not “thirty five cents,- as provided inthe 1925 revision. Except for the -thirty five cents” modification, Article 2823, R.C.S. 1925 and V.C.S. presently reads identical with the enactment inS.B. 218, Acts 1905.

From the above cited enactments, it is apparent that sfnce 1905 there has been no annual transfer of one per cent of the permanent to the available school fund by any Legislature,
as authorized by Section 5 ofArticle VII of

### theConstitution as amended in 1891.

The Available School Fund is commonly appropriated 

### bytheLegislature eachbiennium fn its departmental appropriation bill, For example, the last such bill, S.B. 391 ofActs 50th Legislature, 1947, Ch. 400, at p. 841, provided:

**“ For**  the purpose provided by law, there 

### ure appropriated 

### for the biennium ending August 31, 1939, to the State Board ofEducation all income to, and balance in. 

### theAvailable School Fund and the State Textbook Fund, except as 

### otherwtse appropriated bythisLegislature, to be expended and distributed in accordance with the lawn ofthis State.

. . .*


### IftheLegirlaturo desires totransfer one per cent of

### the permanent totheAvailable School Fund aoauthorized by Section 5



# iHon. Ray Kirkpatrick, Page 5 (V-839)

ofArticle VII, itmay properly do so by general law (as did the 22nd Legislature in 1892). Such law could also contain the procedure necessary to effect the transfer. A provision in its departmental appropriation bill similar to that quoted herein from S.B. 391, Acts 1947, will then appropriate the Available School Fund as so enlarged.

Further, it is our opinion that the transfer of one per cent ofthe permanent school fund to the available school fund, ifmade, should be accomplished by general legislation rather than by an appropriation bill rider, Tex. Const., Sec. 35, Art. III; Moore v. Sheppard, 144 Tex. 537, 192 S.W.Zd 559 (1946). Thus transferred into the available school fund, itwill, of course, be subject to appropriation as are other such funds.

SUMMARY

An enabling Act is necessary to transfer annually one per cent of the permanent school fund to the available school fund authorized in Section 5 ofArticle VII, Constitution ofTexas,
as amended. This action was taken inH,B. 14 ofActs 1892, 22nd Leg., 1st C.S., oh. 9. p. 8, but subsequently repealed by Section 179 ofS.B. 218, Acts 1905, 29th Leg.. R.S.. ch. 124, p. 263.

A general‘law outlinidgj the procedure and prescribing the duties ofproper officials inaffecting the transfer annually of one per cent of the permanent to the available school fund would clearly constitute legal authority-to affect the transfer.

Yours very truly,

ATTORNEYGENERALOFTEKAS

Byqf%z2k-;Pw

Chester E. Ollison Assistant

CEO:mw: v

FIRST ASSISTANT ATTORNEY GENERAL