Honorable Robert S. Calvert Opinion No. M-942

Comptroller of Public Accounts State Finance Building Re:Applicability of recent Austin, Texas Presidential Executive Order providing for stabilization ofprices; salaries, etc., to the State ofTexas, and related questions. Dear Mr. Calvert:
This will acknowledge your letter ofAugust 20, 1971, in which you requested the opinion of this office on the followingquestions:

"1

. Is President Richard Nixon's Executive Order providing for stabilization ofprices, rents, wages and salaries applicable to the State ofTexas?

"2. Does Governor Preston Smith's Proclamation ofAugust 19, 1971,have any effect?

"3. Is the Comptroller of Public Accounts authorized topay salaries at sums less than those provided for inSenate Bill 11,Acts of the 62nd Legislature, Regular Session, 1971, and House Bill 279,Acts of the 62nd Legislature, Regular Session, 1971. Stated another way, does the law authorize him to conform to the Presidential Proclamation?"
The first question iswhether the President's Proclamation freezing wages andprices applies to the state.
Section 1of the Proclamation states:

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"Prices, rents, wages, and salaries shall be stabilized for aperiod ofninety (90)days from the datehereof at levels not greater than the highest of those pertaining to a substantial volume of actual transactions by each individual, business, firm and other entity of anykind during the thirty day period ending August 14, 1971

. . .(I

Indetermining the intent of the President, we must examine the language quoted above which states ".
. .or other entity of anykind." The authorities clearly indicate that this language isbroad enough to Cover the state.

InCase v. Bowles, 327U.S. 92, 66 S. Ct. 438, 90 L.Ed. 552, (1946),the State ofWashington became involvedwith the federal government overwhether the Emergency Price Control Act applied to the state's selling of timber tovarious individuals pursuant to state law. The State ofWashington took the position that because theword "State"was not mentioned in the Emergency Price Control Act that Congress did not intend for thisAct to apply to the states. However, the Supreme Court held that just because Congress does not use theword "State" inanyAct does notmean conclusively that theAct does not apply to a state or the states. The court found language in the Emergency Price Control Act similar to the above quoted language of the President's Proclamation and stated that that language was broad enough to cover states and the court also observed that tohold otherwise would frustrate the obvious intent of Congress to control inflation under the Emergency Price Control Act if the states were not covered by suchAct.

In addition to Case v. Bowles, supra, there isa companion case styled Hulburt v. Twin Falls County, Idaho, 327U.S. 103, 66S.Ct. 444, 90 L-Ed. 560 (1946).which holds that the Emergency Price Control Act applies to a county. The Supreme Court in this latter decision applied the same rationale as found in the Case v. Bowles decision.
There is one decision which seems somewhat in conflict with the above stated decisions. It is the case of Penn Dairies The Milk Control Commission, 318U.S. 261, 63 S.Ct. 617, :;-L-Ed. 748 (1943). In this case the Supreme Court stated

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a rule that in the absence of an express intent by Congress to set aside a statute of the state regulating the internal affairs, the courtwould not lightly infer or imply such intentwhere the act isambiguous.

In the Penn Dairies case the Supreme Court refused to apply a federal statute toresolve an alleged conflict between the federal statute and a state lawon thebasis the federal statute did not expressly use the **term “** **State ”**  and consequently the Supreme Court found no supremacy clause problems. However, in amore recent decision, California v. Taylor, 353U.S. 553, 77 S.Ct. 1037, 1L.Ed.2d 1034 (1956), the Supreme Court held that an act of Congress, which dealtwith regulations under the Interstate Commerce Clause of all public railroads, that a railroad owned by the State of California was subject to the congressional act in spite of the fact congressional act did not use the **term** "State" in theAct. The court stated in essence where the aim of an act can fairly be inferred to apply to a state, then such aim cannot be disregarded for lack of specific language.
Also, it should bepointed out that a 1963 decision by the Supreme Court styled Paulvs. U.S., 371U.S. 271, 83 S.Ct. 426, 9L.Ed.2d 292 (1963)cast a serious cloud over the viability of the Penn Dairies case. The dissent in Paul vs. U.S. indicates that the **majority** opinion in the Paul case, in effect, overrules the Penn Dairies case on the question of whether a federal act covered the state and therefore was in conflict with the state act and the state act had to fall under the supremacy clause.

We have before us at this time a Presidential Order based upon anAct of Congress which provides "the President is authorized to issue such order and regulations ashe may deem appropriate to stabilize prices, rents, wages, and salaries

. . .II and theAct further provides "whenever it appears . ._that any person has engaged

. . ." Inour opinion, based upon an analysis of the above discussed decisions, the Executive Order is applicable to the State of Texas and all other states.
Any state law,however, clearly within state acknowledged power, which interferes with or is contrary to avalid federal

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lawmust yield to the federal law to the extent of the conflict. Continental Radio Co. v. Continental Bank &Trust Co., 369 S.W.2d 359 (Tex.Civ.App. 1963, error ref., n.r.e.1; Free v. Bland, 369U.S. 663 (1962,revg. 344 S.W.2d 435, Tex. Sup., 1961, and conformed to 359 S.W.2d 27).

The principle iswell established that
II

. . .where Congress has authorized apublic officer to take some specified legislative action when inhis judgment that action isnecessary or appropriate to carry out thepolicy of Congress, the judgment of the officer as to the existence of the facts calling for that action isnot subject to review

. . .N U.S. v. Bush, 310U.S. 371 (1940).

Inthis Bush case, the President of the United States acted, as authorized under Act of Congress, by Proclamation to increase the duty and changes in classification of certain foreign imports. In the earlier case of Dakota Cent. Telephone Co. v. State of South Dakota, 250U.S. 163 (1919) the very broad powers of the President to takepossession and control of telegraph, telephone, and other communication companies, and operate them, by Proclamation, under authorization of Congress andhis wartime powers, was upheld. An Executive Order of the President

II

. . . is tobe accorded the force and effect given to a statute enacted by Congress

. . .II Farkas v. Texas Instrument, Inc., 375F.2d 629 (5thCir. 1967, cert. den. 389U.S. 977)

The power of the President to act by the Executive Order under consideration is fully sustained by theauthorities cited in support of the text in the text book entitled Modern Constitutional Law, by Chester J.Antieau, Volume II, Section 11:21 at pages 222-231, and Sections 13:22 through 13:25 at pages 526-531.

I,

. . .the clearest demonstration of arbitrariness is required to justify a court in striking down a proclamation of the President." 16C.J.S., 437 Constitutional Law, Sec. 99, citing Beal v. U.S., C.A. Ey. 182 F.2d 565, cer. den. 71 S.Ct. 81, 340

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U.S. 852, 95 L-Ed. 625.

We conclude that the Executive Order is avalid exercise of executive power pursuant to express congressional authorization.
The next question for consideration iswhat effect the Governor's Proclamation ofAugust 19, 1971,has upon thepayment ofwages and salaries to State officials, State employees and teachers in thepublic schools of this State, pursuant to theprovisions of Senate Bill 11,Acts of the 62nd Legislature, Regulat Session, 1971, as amended, and House Bill 279,Acts of the 62nd Legislature, Regular Session, 1971. At this point, the terms of theGovernor's Proclamation ofAugust 19, 1971, should be examined, and they are set forth as follows:

"Idohereby proclaim that the State of Texas will abide by the laws of the State of Texas and will put into effect on September 1, 1971, theprovisions of Senate Bill 11,Acts of the 62nd Legislature, Regular Session, as amended, and House Bill 279,Acts of the 62nd Legislature, Regular Session.
"Bythis proclamation, I amhereby instructing all State agency heads to comply with Senate Bill 11 and House Bill 279. In complying with this proclamation, no State agency head shall be liable for obeying these provisions of state law. As Governor of the State of Texas, Iaccept full responsibility for the actions taken by all state agency heads pursuant to this proclamation."

The foregoing provisions of the Governor's Proclamation of August 19, 1971,merely instruct theheads of all state agencies toput into effect and comply with theprovisions of Senate Bill 11,The General Appropriations Bill, and House Bill 279, which sets forth certain salary increases for the teachers of thepublic schools. Such Proclamation does not specifically instruct theheads of thevarious State agencies to ignore or defy the Presidential Executive Order freezing wages and salaries.

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While theGovernor's Proclamation does not specifically set forth that Senate Bill 11and House Bill 279 are tobe put into effect inamanner in conflict with the Presidential Executive Order, the following comments will be based upon the assumption that the intent of theGovernor's Proclamation
was for thevarious heads of State agencies to disregard the Presidential Executive Order in the payment ofwages and salaries pursuant to Senate Bill 11and House Bill 279.
Section 1ofArticle IV of the Constitution of Texas provides that:

"TheExecutive Department of the State shall consist of aGovernor, who shall be the Chief Executive Officer of the State, a Lieutenant Governor, Secretary of State, Comptroller of PublicAccounts, Treasurer, Commissioner of the General Land Office, andAttorney General."
Section 10ofArticle IV of the Constitution of Texas provides:

"He (theGovernor) shall cause the laws tobe faithfully executed and shall conduct, inperson, or in suchmanner as shall be prescribed by law, all intercourse and business of the State,with the other States andwith theUnited States."
Of significance is the interpretative commentary following Section 10ofArticle IVwhich provides:

"Theobligation placed by this section upon thegovernor to cause the laws tobe faithfully executed is, obviously, executive innature. But this obligation, and the fact that the governor ismade the chief executive officer of the state, do not confer uponhim any specific power. In construing state constitutions, the state courts have not derived, as **has** the Supreme Court of the United States with respect to the Federal Executive, any very largepower from such ageneral power or duty as to the duty to see that the lawsbe

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faithfully executed. The rule of delegated powers has been construed strictly as to the governor, so thathe has noparticular power unless granted tohim, expressly or impliedly.
"Moreover, this responsibility placed upon him for law enforcement inTexas ismore fiction than reality, for the constitution gives thegovernor little power to see that the laws are enforced. Other than the power to declare martial law and theuse of themilitia andTexas Rangers, little ornomeans of carrying out this responsibility isprovided. Apparently, ashas been stated, this section confers upon the governor only the duty togive direction to themanagement of affairs in all the branches of the executive department. See Houston Tap &Brazoria R. Co. v. Randolph, 24T. 317 (1859)."
The case of Houston Tap &Brazoria R. Co. v. Randolph, 24T. 317 (1859)referred to contains an informative comment by the court upon the relationship between theGovernor and the other agencies and officers comprising the Executive Department of the State of Texas, and such comments are set forth as follows:

II

. . . He (thegovernor) is thehead of the Executive Department of the State, and it ismade his duty, by the Constitution, to 'takecare that the lawsbe faithfully executed'. It is evidently contemplated, thathe shall give direction to the management of affairs, inall thebranches of the Executive Department. Otherwise hehas very little to do. Where hehas the power of removal, he can assume authoritative control absolutely in all of the departments. This being the case in the United States government, results in the entire unity of its Executive Department. The absence of that absolute power of the chief executive in this State must occasionally produce awant ofharmony in the executive administration, by the inferior offices of that administration, declininq to comply with thewishes, or to follow the judgment of the

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governor. That isan inherent difficulty in the organization of that department, and the conflicts arising out of it, cannot be adjudicated or settled by the judiciary. The fact that there isno remedy for an injury growing out of such conflict, cannot justify another department, towit, the judiciary, in overstepping theboundary of itsprescribed authority for the purpose of furnishing a remedy. The other department, the legislative, may be able to furnish a remedy. The judiciary act onpassed facts. The Legislature acts by devising for the future

. . .'I (Emphasis added.)

In the case ofWilliams v. State, 176 S.W.2d 177Ct. of Crim.App. 1943, the court had certain questions before it dealing with aproclamation of thegovernor and the court's comments in connection with these issues is set forth as follows:

"Does theAct provide for reasonable notice of the Governor's proclamation putting into effect the recommendation of the Commission?

"Asto this, the record reflects that the Governor's proclamation was duly and regularly filed by the Governor, in the office of the Secretary of State longprior to theyear 1942, and that appellant's landwas in the regulated zone therein set out. A proclamation of the Chief Executive of this State, when duly promulgated and filed, occupies aposition comparable to laws regularly passed by theLegislature. That a proclamation by theGovernor, of andwithin itself, isnotice is further manifested by the fact that the courts are required to take, and do take, judicial notice of the contents thereof

. . .I' (Emphasis added.)
While the foregoing case dealt merely with whether the Governor's Proclamation constituted sufficient notice, the language therein might tend to indicate that suchproclamations are similar in effect to a legislative enactment. However, inthe case ofTerre11 Wells Swimminq Poolv. Rodriquez, 182 S.W.2d 824 (Tex.Civ.App. 1944, error ref.),

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the court stated in connection with aproclamation by the Governor that:

'Withreference to theproclamation issuedby theGovernor on June 25, 1943, it is sufficient to say that theGovernor of this State, even in time ofwar, iswithout power to chanqe the existinq law merely bv the issuance of aproclamation, andwe attribute no such intention to the Governor." (Emphasis added.)
Also, at this point the case of Sterlinq v. Constantin, 287U.S. 378, 53S.Ct. 190, 77L.Ed. 375 (1932).gives us a most enlightening example of the results of an Executive Order or Proclamation of the Governor of a state conflicting with action by the federal government. This case dealt with the State ofTexas, and the comments of the court are set forth as follows:

II

. . .Thequestion before us is simply with respect to the Governor’s attempt to regulate by executive order the lawful use of complainant's properties in theproduction of oil. Instead of affording them protection inthe lawful exercise of their rights as determined by the courts, he sought, by his executive orders, tomake that exercise impossible. In the place of judicial procedure, available in the courts which were open and functioning, he set uphis executive commands which brooked neither delay or appeal, inparticular, to the process of the federal court actually and properly engaged inexamining andprotecting an asserted federal right, the Governor interposed the obstruction ofhis will, subverting the federal authority.
II

. . . II

. . .There was no exigency which justified the Governor inattempting to enforce by executive ormilitary order the restriction which the District Judge had restrained pending proper judicial

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authority. If itbe assumed that the Governor was entitled to declare a state of insurrection and to bring military force to the aid of civil authority, theproper use of that power in this instance was tomaintain the federal court in the exercise of its jurisdiction and not attempt to override it: to aid inmaking itsprocess effective andnot to nullify it; to remove, and not to create, obstructions to the exercise by the complainants of their rights as judicially declared

. . ."

Inview of the foregoing authorities, we are of the opinion that the Proclamation of theGovernor issued onAugust 19, 1971, ismerely directive to thevarious heads of the State agencies and not amandatory requirement upon them. In addition, we are of the further opinion that the Governor's Proclamation ofAugust 19, 1971, does nothave the effect of altering or amending existing State or Federal statutes or Executive Orders. Therefore, the Governor's Proclamation does not repeal, modify or change the Presidential Executive Order inany respect.

It iswell settled that an appropriation bill sets apart from the public revenue sums ofmonies for specific objects authorizing the executive officers of the State touse that money inthe amount, manner, and purpose of the various items of expenditures and therefore ageneral appropriation bill may contain any provisions or riders which detail, limit or restrict the use of funds or otherwise insure that themoney is spent for the required activities of the State forwhich it is therein appropriated. Attorney General's Opinions 2965 (1935)andV-1254 (1951)and authorities cited therein. It has been held that ageneral appropriation bill cannot repeal, modify or amend an existing general law. State v. Steele, 57Tex. 203 (1882);Linden v. Finley, 92Tex. 451, 49 S.W. 578 (1889);Moore v. Sheppard, 144Tex. 537, 192 S.W.2d 559 (1946). In each of these cases, however, the invalidity of theparticular rider in question did not affect the remaining authorization for the expenditure ofpublic monies and the stipulation of the amount, manner, and purpose of thevarious items of expenditures. The Executive Order of the President constitutes aportion of thepre-existing law controlling the Appropriation Bills. -4609-Hon. Robert S. Calvert, page 11 (M-942)

Following the reasoning of the numerous cases construing appropriation bills throughout thehistory of this State, it isour opinion that the Executive Order of President Nixon will effect only themaximum amount of salary authorized to be paid inSenate Bill 11,Acts 62nd Legislature, Regular Session, 1971, and House Bill 279, Acts 62nd Legislature, Regular Session, 1971, and does not inany manner affect the remaining authorizations for expenditure ofpublic monies for thepurposes set out intheAppropriation Bills.

You are accordingly advised that the Comptroller of Public Accounts isauthorized topay salaries at sums less than those provided in theAppropriation Bills in those instances required by the President's Executive Order and is required to take such other necessary steps asmay be deemed appropriate to conform to the Presidential Proclamation.

SUMMARY
President Nixon's recent Executive Order providing for stabilization of prices, rents, wages and salaries isvalid and applicable to the State ofTexas.

Governor Smith's Proclamation of August 19, 1971, does not repeal, modify or affect said Executive Order.
The lawrequires the Comptroller of Public Accounts of the State ofTexas to conform to said Presidential Executive Order.

C A General ofTexas Prepared by J. C. Davis Assistant Attorney General

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APPROVED: OPINION COMMITTEE

Kerns Taylor, ChairMln
w. E.Allen, Co-Chairman Pat Bailey John Reeves James McCoy Pat Cain

ALFRED WALKER Executive Assistant

NOLA WHITE First Assistant

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