OFFICE OF THE ArronNEv GF.NER.u STATE OF TEXAS 

JOHN CORNYN 

June 3, 1999 

The Honorable Michael P. Fleming 

Harris County Attorney 

1001 Preston, Suite 634 

Houston, Texas 77002-1891 

Opinion No. JC-0062 

Re: Whether interest on a prosecutor’s hot-check 

fund may be severed from the principal and 

accrue to the county’s general fund (RQ-1054) 

Dear Mr. Fleming: 

You ask whether the interest earned on a prosecutor’s hot-check fund, established under 

article 102.007(f) of the Code of Criminal Procedure, may be severed from the hot-check fund and 

added to the county’s general revenue fund. Because section 113.021(c) of the Local Government 

Code severs the interest from statutory special funds belonging to the county, we conclude that 

interest on a prosecutor’s hot-check fund must be severed and applied to the benefit of the county 

as a whole. We thus concur with Attorney General Opinion JM-632 (1987). 

A prosecutor may establish a hot-check fund in accordance with article 102.007 ofthe Code 

of Criminal Procedure. Under article 102.007(a), a prosecutor may impose a fee for collecting and 

processing a bad check. See also TEX. BUS. & COM. CODE ANN. 5 3.108(a) (Vernon Supp. 1999) 

(defining order “payable on demand”); TEX. CODECRIM. PROC. ANN. art. 102.007(c) (Vernon Supp. 

1999) (setting maximum fee). The prosecutor must deposit the fees into a special fund, the “hotcheck fund,” in the county treasury: 

Fees collected under Subsection (c) of this article shall be deposited in the 

county treasury in a special fund to be administered by the county attorney, district 

attorney, or criminal district attorney. Expenditures from this fund shall be at the 

sole discretion of the attorney and may be used only to defray the salaries and 

expenses of the prosecutor’s office, but in no event may the county attorney, district 

attorney, or criminal district attorney supplement his or her own salary from this 

fund. 

Id. art. 102.007(f). Article 102.007 does not instruct the county treasurer how to handle interest that 

accrues on a hot-check fund. 

Under the common law, interest follows principal, or, more picturesquely, “‘[IInterest shall 

follow the principal, as the shadow the body.“’ Phillips Y. Washington Legal Found., 118 S. Ct. 

1925,193O (1998) (quoting Beckjkd v. Tobin, 1 Ves. Sen. 308,310,27 Eng. Rep. 1049, 1051 (Ch. 

1749)). Texas courts follow this rule. See Sellers Y. Harris County, 483 S.W.2d 242, 243 (Tex. 
The Honorable Michael P. Fleming - Page 2 (X-0062) 

1972); Lawson Y. Baker, 220 S.W. 260, 272 (Tex. Civ. App.-Austin 1920, writ refd); accord 

Phillips, 118 S. Ct. at 1930-3 1. As the Texas Supreme Court has stated, “Interest. is an increment 

that accrues” to the principal fund earning it, and, unless lawfully separated from the principal, 

becomes a part of the principal. Sellers, 483 S.W.2d at 243; accord Lawson, 220 S.W. at 272. 

Interest on a fund created by statute, however, may be severed by means of a statute 

expressly overruling the common law. The legislature may overrule the common law if it does so 

expressly. See Sellers, 483 S.W.2d at 243. With respect to a special fund, legislation overruling the 

common law must be of equal dignity to the law creating the fund. Thus, interest earned on a 

constitutionally dedicated public fund may be severed only by constitutional amendment, while 

interest earned on a statutorily dedicated public fund may be severed by statutory amendment. See 

Lawson, 220 S.W. at 272-73; Tex. Att’y Gen. Op. No. JM-539 (1986) at 3. 

With respect to a fund created by statute and belonging to the county, section 113.021(c) of 

the Local Government Code expressly overrules the common-law rule that interest follows the 

principal. Under that section, any interest that accrues on a special fund belonging to the county 

“is for the benefit of the county in accordance with other law.” TEX. Lot. GOV’T CODE ANN. 

§ 113.021(c) (Vernon 1988). While section 113.021(c) does not expressly limit its application to 

the interest accruing on funds created by statute, the law must be construed to be so limited. The 

legislature may not attempt to sever the interest on a constitutionally created special fund by means 

of a statute. See Lawson, 220 S.W. at 272-73; Tex. Att’y Gen. Op. No. JM-539 (1986) at 3. 

Consequently, the interest on a hot-check fund must be severed from the hot-check fund and 

accrue to the county’s benefit ifthe hot-check fund is “money belonging to the county” for purposes 

of section 113.021(a). See TEX. LOC. GOV’T CODE ANN. 5 113.021(c) (Vernon 1988) (ordering 

severance of interest). As we have said in previous opinions, expenditures from the hot-check fund 

are solely within the prosecutor’s discretion and wholly outside the county commissioners court’s 

budgeting process. See Tex. Att’y Gen. Op. Nos. DM-357 (1995) at 6; MW-439 (1982) at 6; Tex. 

Att’y Gen. LO-96-075, at 2; LO-96-074, at 4. But this fact is of little relevance to determining 

whether the hot-check fund belongs to the county or belongs to some other entity for the purpose of 

ascertaining the disposition of interest on the fund. 

We conclude the hot-check fund is money belonging to the county. The legislative history 

of the phrase “money belonging to a county” indicates that it is meant to distinguish public money 

benefitting some aspect of county government from money belonging to or meant to benefit another 

(noncounty) public entity or a private individual or entity. Cf: Tex. Att’y Gen. Op. No. DM-396 

(1996) at 4 (stating that restitution justice of peace receives under Penal Code section 32.41(e) 

does not belong to county, but rather to holder of dishonored check). In 1933 the legislature 

authorized the county auditor in counties with populations of 190,000 or more to “adopt and 

enforce regulations . essential to the speedy and proper collection and checking of, and 

accounting for, the revenues and other funds and fees belonging to the county or to any person, firm, 

or corporation for whom [a county] officer may have made collections, or for whose use or benefit 

[the officer] may have received or may hold such funds.” See Act approved Apr. 29,1933,43d Leg., 
The Honorable Michael P. Fleming - Page 3 (X-0062) 

R.S., ch. 98, sec. 1, art. 1656a, 1933 Tex. Gen. Laws 217, 217-18. Thus, the law distinguished 

between money belonging to the county and money belonging to a private entity and did not 

contemplate an alternative owner. Additionally, the county treasurer is custodian of all money 

belonging to the county. See TEX. Lot. GOV’T CODE ANN. $4 113.001, .003 (Vernon 1988). The 

hot-check fund is a special fund in the county treasury. See TEX. CODE GRIM. PROC. ANN. art. 

102.007(f) (Vernon Supp. 1999) (designating hot-check fund “special fund” in county treasury). 

In answer to your question, the interest on the hot-check fund accrues not to the hot-check 

fund but to the benefit of the county. The county’s general fund is a permissible beneficiary, but we 

need not consider here whether it is the sole permissible beneficiary. This conclusion accords with 

a prior opinion of this office, Attorney General Opinion JM-632, which determines that interest 

earned on a hot-check fund must be severed from the principal and deposited in the county’s general 

revenue fund. See Tex. Att’y Gen. Op. No. JM-632 (1987) at 1; see also TEX. CODE GRIM. PROC. 

k-IN. art. 102.007 (Vernon Supp. 1999) (Fee for Collecting and Processing Sight Order); Act of 

May 24, 1991,72d Leg., R.S., ch. 396,§ 2,199l Tex. Gen. Laws 1508,1509 (renumbering Code 

of Criminal Procedure article 102.007(e) as article 102.007(f)); Act of May 17, 1985, 69th Leg., 

R.S., ch. 269, sec. 1, $102.007(e), 1985 Tex. Gen. Laws 1300,1303 (renumberingCodeofCrimina1 

Procedure article 53.08(e) as article 102.007(e)). 

Although we reach the same conclusion this office reached in Attorney General Opinion 

JM-632, that opinion does not make clear that a statute explicitly authorizes the severance of interest 

from the principal of a hot-check fund. The opinion cites, in passing, the statutory predecessor of 

Local Government Code section 113.021(c), Texas Revised Civil Statutes article 1709a, but 

the opinion does not rely on article 1709a in reaching its conclusion. See Tex. Att’y Gen. Op. No. 

JM-632 (1987) at 1, 3. Rather, the opinion reasons that the hot-check fund is a statutory fund, not 

a trust fund, and that, consequently, interest on the fund need not follow the principal. See id. at 2-3. 

The opinion then states that the legislature has adopted a statute requiring that interest on such 

“statutory funds” be credited “to the general revenue funds of the respective counties,” but the 

opinion cites article 1709 ofthe Revised Civil Statutes instead of article 1709a. See id. at 3. Article 

1709 at that time required that “all moneys belonging to the county” be turned over to the county 

treasurer; required the county treasurer to “keep and account” for all county money in a designated 

depository; and required the county treasurer to disburse county money as the county commissioners 

court directed. See Act ofMay 21, 1971,62d Leg., R.S., ch. 467, 4 1, 1971 Tex. Gen. Laws 1654 

(current version at TEX. Lot. GOV’T CODE ANN. 5s 83.006,113.001, ,003, .041 (Vernon 1988 & 

supp. 1999)). 

In our opinion, the critical issue in determining whether interest may be severed from the 

principal ofa fund created by statuteunder section 113.021 ofthe Local Government Code depends 

not upon whether the fund is held in trust, but whether the fund belongs to the county. While the 

indicia of a trust, listed in Attorney General Opinion JM-632, may be helpful in determining whether 

the fund belongs to the county, they may not resolve the issue. See Tex. Att’y Gen. Op. No. JM-632 

(1987) at 2 (listing, as indicia of a trust fund, (1) that funds are administered by trustee; (2) that funds 

are not granted to county in its sovereign capacity nor collected for county’s general operation; and 
The Honorable Michael P. Fleming - Page 4 (X-0062) 

(3) that funds are to be spent and invested for specific, limited purposes and to benefit specific group 

of individuals). The legislature may decide to sever the interest from the corpus of even a statutory 

“trust,” or special fund, held for a public entity, if it does so expressly. See Lawson, 220 S.W. at 

272-73. To the extent the reasoning of Attorney General Opinion JM-632 is inconsistent with this 

opinion, it is modified. 

SUMMARY 

In accordance with Local Government Code section 

113.021(c), interest that accrues on the principal of a prosecutor’s 

hot-check fund, a statutory fund established under article 102.007(f) 

of the Code of Criminal Procedure, must be severed from the 

principal. The interest accrues instead “for the benefit of the county.” 

Attorney General Opinion JM-632 (1987) is modified to the extent its 

reasoning is inconsistent with this opinion. 

JOHIN CORaYN 

Attorney General of Texas 

ANDY TAYLOR 

First Assistant Attorney General 

CLARK KENT ERVIN 

Deputy Attorney General - General Counsel 

ELIZABETH ROBINSON 

Chair, Opinion Committee 

Prepared by Kymberly K. Oltrogge 

Assistant Attorney General