No. 13552 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

CHARLES W. HUBER, 

Plaintiff and Appellant, 

WILLIAM A. GROFF , VIRGINIA JELT,ISON , 

PAUL A. JOHNSON, JAMES J . LEARY , DAN 

K. MIZNER, PAUL E. POLZIN, WARREN F. 

VAUGHAN, as members of and constituting 

the Bonrd of Housing of the State of 

Montana, 

Defendants and Respondents. 

ORIGINAL PROCEEDING: 

Counsel of Record: 

For Appellant : 

Patrick F. Hooks argued, Townsend, Montana 

For Respondents: 

Moulton, Bellingham, Longo and Mather, Billings, 

Montana 

Fredric D. Moulton argued, Billings, Montana 

Walter S. Murf itt appeared, Special Assistant 

Attorney General, Helena, Montana 

Submitted : October 25, 1976 

Decided BE6 2 9 3976 

Filed :mc 2 8 f2T7 
Mr. Justice John Conway Harrison delivered the Opinion of the 

Court. 

This is an original proceeding brought by Charles W. Huber, 

plaintiff, against the members of the Board of Housing of the 

state of Montana seeking a declaratory judgment pursuant to 

Chapter 89, Title 93, Revised Codes of Montana 1947. The Court 

accepted original jurisdiction pursuant to Rule 17(a), M.R.App.Civ. 

P. because the shortness of time before the next meeting of the 

legislature made "due consideration in the trial court and due 

appeal to this Court an inadequate remedy." 

The plaintiff seeks to have the "Housing Act of 1975" 

which was passed as Chapter 461, Laws of 1975, by the Forty-fourth 

Legislature declared unconstitutional on several grounds: 

First, plaintiff alleges the Act does not serve a public 

purpose as required by Art. VIII, Section 1, 1972 Montana Constitution. 

Second, plaintiff alleges the bonds the Housing Board intends 

to sell are state debt and violate the requirements of Art. VIII, 

Section 8, 1972 Montana Constitution. 

Third, plaintiff alleges that even if the bonds are not 

state debt, section 35-517, R.C.M., violates the separation of 

powers section of the 1972 Montana Constitution and impinges on 

the powers of the executive violating Art. 111, Section 1 and Art. 

VI, Section 9. 

Fourth, plaintiff alleges the entire Act, and especially 

section 35-517, violates Art. V, Section ll(5). 

Fifth, plaintiff alleges the Act entails an unconstitutional 

delegation of the legislative power. 
Sixth, plaintiff alleges the statutory flow of funds violates 

Art. VIII, Section 12, Section 13 and Section 14. 

Seventh, plaintiff requests the Court resolve the statutory 

conflict between section 5-1037, R.C.M. 1947, and the Housing Act 

A brief look at the function of the proposed programs of 

the Housing Board is necessary as background. The Housing Board 

intends to issue what are basically revenue bonds. The legislature 

granted these bonds tax exempt status and this status, along with 

the fact that the bonds are issued by a carefully supervised. 

governmental body, should reduce the risk factor resulting in a 

significantly lower interest rate. The Housing Board's plan is 

to take this low interest money and inject it into the state's 

mortgage money market to make mortgage money available to "persons 

and families of lower income." The Housing Board currently plans 

to use only two of the statute's programs, the loan to lender 

program and the mortgage repurchase program. Both programs operate 

in a similar manner. The first program loans money to lending 

institutions on the condition they loan that money within a specified time period to "persons or families of lower income". The 

second program provides for the purchase of mortgages on the 

condition that the money be lent to "persons or families of lower 

income.'' Both programs have financial incentives which encourage 

lending institutions to participate . 

Before beginning discussion of plaintiff's specific allegations we note the adoption of the 1972 Montana Constitution resulted 

in a significant change in the constitutional framework in the 

revenue and finance provisions. That change was the result of the 

deletion of the 

11889 Constitution's Art. XIII, Section 1 which prohibited the 

lending of credit of the state to individuals and corporations. 
This prohibition serves as the background for many of the older 

cases in Montana and most cases in other states even today. 

First. Plaintiff contends the Housing Act of 1975, sections 

35-501 through 35-526, R.C.M.1947, does not serve a public purpose. 

Art. VIII, Section 1, Montana Constitution requires:. 

"Tax purposes. Taxes shall be levied by general 

laws for public purposes .It 

This Court in Mills v. Stewart, 76 Mont. 429, 438, 247 P. 332, 

held : 

"The power to appropriate public funds and the power 

to levy and collect taxes are identical. (Panchot v. 

Leet, 50 Mont. 314, 146 Pac. 927; Gem Irrigation District 

v. Van Deusen, 31 Ida. 779, 176 Pac.. 887; College v. 

Hager, 121 Ky. 1, 87 S.W. 1125; 1 Cooley on Taxation 

4th ed. sec. 177.)" 

The question is twofold: (1) Is the purpose of the legislation a public purpose? (2) Are the means selected reasonably 

likely to accomplish that public purpose? 

The purpose of the Housing Act of 1975.i~ set out in 

section 35-502: 

"The legislature finds and declares that there is a 

shortage in Montana of decent, safe, and sanitary 

housing which is wid.rtn the financial capabilities of 

lower income persons and families. In order to 

alleviate the high cost of housing for these persons, 

the legislature believes that it is essential that 

additional public moneys be made available, through 

the issuance of revenue bonds, to assist both private 

enterprise and governmental agencies in meeting critical 

housing needs .It 

The basic means to be used to accomplish this purpose are set out 

in section 35-505: 

"(1) The board may: (a) make loans to lending institutions 

under terms and conditions adopted by the board requiring 

the proceeds to be used by the lending institution for the 

making of mortgage loans for housing developments in the 

state for persons and families of lower income; 

"(b) invest in, purchase or make commitments to 

purchase, and take assignments from lending institutions, 
of notes, mortgages and other securities evidencing 

loans for the construction, rehabilitation, purchase, 

leasing or refinancing of housing developments for 

persons and families of lower income in this state, under 

terms and conditions adopted by the board; 

"(c) make, undertake commitments to make, and participate in the making of mortgage loans, including federally 

insured mortgage loans, and to make temporary loans ' and 

advances in anticipation of permanent mortgage loans to 

housing sponsors to finance the construction or rehabilitation of housing developments designed and planned for 

occupancy by persons and families of lower income in this 

state, under terms and conditions adopted by the board; 

"(d) make, undertake commitments to make, and participate in the making of loans to persons and families of 

lower income for housing development, including without 

limitation persons and families of lower income who are 

eligible or potentially eligible for federally insured 

loans, federal mortgages or other federal housing assistance, 

when the board determines that mortgage loans are not 

otherwise available, wholly or in part, from private lenders 

upon reasonably equivalent terms and conditions, and under 

terms and conditions adopted by the board. * * *" 

The Housing Board has taken necessary administrative steps 

to activate subsections (a) and (b), section 35-505 and these programs are ready to begin. 

As this Court pointed out in Cottingham v, State Board of 

Examiners, 134 Mont. 1, 10, 11, 328 P.2d 907: 

"The constitutionality of a legislative act is presumed, 

and this presumption must be overcome beyond a reasonable 

doubt before this court may overturn an expression of 

legislative will. * * * 

"'As we have observed hitherto, the Constitution must 

receive a broad and liberal interpretation consistent 

with the purpose of the framers and the people in adopting 

it, that it may serve the needs of a growing state; "the 

proper interpretation of any constitutional provision 

requires us to remember that it is a part of the organic 

law---organic not only in the sense that it is fundamental, 

but also in the sense that it is a living thing designed 

to meet the needs of a progressive society, amid all the 

detail changes to which a progressive society is subject."'" 

In Willett v. State Board of Examiners, 112 Mont. 317, 322, 

115 P.2d 287, the Court said: 
'I* * What is a 'public purpose' is a question 

primarily for legislative determination, with which 

we will not interfere unless there had been a clear 

abuse of power. * * *" 

A great majority of other st8tes which have considered 

nearly identical legislation found housing to be for a public 

purpose. State ex rel. Warren v. Nusbaum, 59 Wisc.2d 391, 208 

N.W.2d 780; Minnesota Housing Finance Agency v. Hatfield, 297 

Minn. 155, 210 N.W.2d 298; Vermont Home Mortgage Credit Agency 

v. Montpelier National Bank, 128 Vt, 272, 262 A.2d 445; New Jersey 

Mortgage Finance Agency v. McCrane, 56 N.J. 414, 267 A.2d 24; 

Maine State Housing Authority v. Depositors Trust Co., (Maine 1971), 

278 A.2d 699; Opinion to the Governor, 112 R.I. 139, 308 A.2d 802; 

Johnson v. Penn. Housing Finance Agency, 453 Pa. 329, 309 A.2d 528; 

Massachusetts Housing Finance Agency v. New England Merchant's 

National Bank, 356 Mass. 202, 249 N.E.2d 599 (overruling advisory 

opinion Opinion of the Justices, 251Mass. 716, 219 N.E.2d 18); 

Walker v. Alaska State Mortgage Association (Alaska 1966), 416 

P.2d 245; Gibson v. Smith, - Or. App. -9 531 P.2d 724; In the 

Matter of the Constitutionality of O.R.S. 456.720, - Or. 

, 

537 P.2d 542; California Housing Finance Agency v. Elliot, - Cal. 

,!!T 

tipre. 3 555 P.2d &9; State ex rel. West Virginia Housing 

Development Fund v. Copenhaver, 153 W.Va 636, 171 S.E.2d 545; 

Rich v. Georgia, - Ga . , 227 S.E.2d 761; West v. Tennessee 

Housing Development Agency, (Tenn. 1974), 512 S.W.2d 275. The 

lone state that found this legislation is not for a public purpose 

is Michigan where in In re Advisory Opinion, 380 Mich. 554, 158 N.W. 

2d 416, the Supreme Court of that state found the act was for a 

public purpose except as it related to a unique state constitution 

provision which relates to construction of internal improvements 
and which prohibited the state from being a party to such improvements. The Michigan court ruled the state was not a party 

to the improvements. The housing statute was not found to violate 

any other provision and was for a public purpose for all other 

constitutional provisions. 

This Court in Rutherford v. City of Great Falls, 107 Mont. 

512, 86 P.2d 656, found a housing authority statute that allowed 

the city to begin s lum clearance projects was for public purpose. 

The only difference between Rutherford and the instant case is 

the means chosen to accomplish that end. In Minnesota Housing 

Finance Agency v. Hatfield, 297 Minn. 155, 210 N.W.2d 298, 307, 

it was pointed out: 

"An interest subsidy mechanism is perhaps the most 

unobtrusive method for the government to subsidize 

housing costs and housing so subsidized is less likely 

to be stigmatized with the tarnished image often associated with public housing operated by housingredwklopment 

authorities ." 

It is commendable the Montana legislature and the Housing 

Board chose the interest subsidy means to assist persons in 

attaining safe, sanitary and hedthful housing because it involves 

very little direct government interference with the individual's 

choice of the type of housing he wishes to live in. Because this 

means is different from that chosen in Rutherford in no way 

alters the fact the legislation was enacted to accomplish a public 

purpose and is reasonably structured to accomplish this end. For 

this reason the legislation does not violate Art. VIII, Section 1, 

1972 Montana Constitution. 

Second. Plaintiff questions whether the bonds the Housing 

Board proposes to sell are state debt and therefore subject to 

the provisions of Art. VIII, Section 8, 1972 Montana Constitution 

which states : 
"No state debt shall be created unless authorized 

by a two-thirds vote of the members of each house 

of the legislature or a majority of the electors 

voting thereon. No state debt shall be created to 

cover deficits incurred because appropriations exceeded 

anticipated revenue ." 

The legislature passed the Housing Act of 1975 by a twothirds vote of the members of each house, but it is clear that the 

means taken by the sponsors of this legislation to avoid a conflict 

with the provisions of Art. VIII, Section 8 was to have the Housing 

Board finance its projects by revenue bonds, which are not state 

debt; If the legislation was intended to create state debt that 

intent would be clearly expressed in the bill's title, or it 

would run contrary to Art. V, Section ll(3) which requires: 

"Each bill, except general appropriation bills and bills 

for the codification and general revision of the laws, 

shall contain only one subject, clearly expressed in its 

title, If any subject is embraced in any act and is not 

expressed in the title, only so much of the act not so 

expressed is void." 

The title of the bill in question reads: 

"AN ACT TO BE KNOWN AS THE HOUSING ACT OF 1975; 

CREATING A BOARD OF HOUSING AND PROVIDING FOR ITS 

POWERS AND DUTIES RELATING TO FINANCING TO ASSIST 

PRIVATE ENTERPRISE AND GOVERNMENTAL AGENCIES TO MEET 

HOUSING NEEDS," [Chapter 461, Laws of 1975.1 

A two-thirds vote of the legislature is an alternative 

to a vote at a general election and this Court will not find the 

legislature has approved the creation of a state debt unless it is 

apparent that was the obvious intent of the legislature. That 

intent is not present in this case. 

We examine the Act to see if a state debt was created. 

The Housing Act of 1975 at section 35-520 reads: 

"Credit of state not pledged. Obligations issued under 

the provisions of this act do not constitute a debt or 

liability or obligation or a pledge of the faith and credit 

of the state but are payable solely from the revenues or 

assets of the board. An obligation issued under this act 
shall contain on the face thereof a statement to the 

effect that the state of Montana is not liable on the 

obligation and the obligation is not a debt of the 

state and neither the faith and credit nor the taxing 

power of the state is pledged to the payment of the 

principal of, or the interest on, the obligation." 

In Fickes v. Missoula County, 155 Mont. 258, 264, 470 P.2d 

287, the Court held that financing projects by the use of revenue 

bonds did not create. a debt which would be subject to the requirements of the predecessor of Art. VIII, Section 8, 1972 Montana 

Constitution. After citing a series of revenue bond cases this 

Court, in Fickes, pbinted out: 

"The common quality of all these projects is that in 

each there is explicit provision that the public body 

issuing the bonds does not obligate its taxing power 

to pay for them. The same exact provision is written 

into the law and the bonds involved in this case, so that 

the same decision must necessarily be made in this case." 

That exact language would be applicable here, except the Housing 

Act of 1975 contains an additional section, section 35-517, which 

is referred to as a "moral make-up clause" and reads : 

"Maintenance of capital reserve account. (1) In order 

to assure the maintenance of the capital reserve account, 

the chairman of the board shall on or before September 1 

in the year preceding the convening of the legislature, 

deliver to the governor a certificate stating the sum, 

if any, required to restore the capital reserve account 

to the minimum capital reserve requirement. The governor 

shall include in the executive budget submitted to the 

legislature, the sum required to restore the capital reserve 

account to the sum of minimum capital reserve requirements. 

All sums appropriated by the legislature shall be deposited 

in the capital reserve account. 

"(2) All amounts appropriated to the board by the 

legislature under this section constitute advances to 

the board and, subject to the rights of the holders of 

any bonds or notes of the board, shall be repaid to the 

state's general fund without interest from available 

operating revenues of the board in excess of amounts required for the payment of bonds, notes or other obligations 

of the board, for maintenance of the capital reserve 

account and for operating expenses." 
A11 the objections to section 35-517 assume the very worst 

combination of events will happen---that the mortgages invested 

in will not provide enough revenue to pay off the bonds; that the 

governor recommended and the legislature approved the loan provided 

for and the land that secures the mortgages has lost value and, 

the sale of the land would not cover the amount secured by the 

mortgage. This is extremely unlikely because land values have 

generally gone up and mortgagors have generally paid a portion 

of the underlying debt before default and the land covers the full 

amount of the debt remaining. There is little likelihood of resort 

to the provisions of section 35-517 but nonetheless its provisions 

must meet constitutional muster. 

An Oregon court of appeals case, Gibson v. Smith, 

O~-APP- , 531 P.2d 724, 728, reviews the difficulties the courts 

in various jurisdictions have had with this provision in its 

various forms : 

''We have considered the opinions and conclusions of other 

courts which have discussed the constitutionality of 

housing acts with provisions similar to those questioned 

at bar. All of them consider provisions like those in 

ORS 456.720(5) to be ineffectual for their purported 

purpose, but several leave them extant as expressions of 

what the legislatures hope future legislatures will do. 

Some strike such provisions because they are nullities. 

In all cases, the crucial questions are decided on the 

basis of the particular state's constitutional provisions. 

In no case we have found have such acts been totally 

struck down, and all hold they bear a public purpose. 

Walker v. Alaska State Mortgage Association, supra; 

Maine State Housing Auth. v. Depositors Trust Ca, 278 A.2d 

699 (Me. 1971) (which held that the attempt to bind future 

legislatures is ineffective, but that the attempt would be 

interpreted so that the word 'shall' means 'may' in order 

to give it the effect of expressing a 'hope' or 'aspiration' 

that future legislatures would appropriate from general 

funds in the event of revenue deficits); Massachusetts 

Housing Finance Agency v, N.E. Merchants National Bank, 

356 Mass. 202, 249 N.E.2d 599 (1969)(where the court interpreted the questioned provision much as did the Maine court 

in Maine State Housing Auth, v. Depositors Trust Co., supra); 

Constitutionality, PA 1966, No. 346, 380 Mich. 554, 158 

I N.W. 2d 416 (1968) (in which the court held invalid a provision like that involved at bar); Minnesota Housing 
Finance Agency v. Hatfield, 297 Minn. 155, 210 N. 

W.2d 298 (1973); New Jersey Mortgage Finance Agency v. 

McCrane, 56 N.J. 414, 267 A.2d 24 (1970); Martin v. 

Housing Corp., 277 N.C. 29, 175 S.E.2d 665 (1970); 

Johnson v. Pennsylvania Housing Finance Agency, 453 

Pa. 329, 309 A.2d 528 (1973); Vt. Home Mort. Cr. Agcy. v. 

Mont. Nat. Bank, 128 Vt. 272, 262 A.2d 445 (1970); 

State ex rel. v. Copenhaver, 153 W. Va. 636, 171 S.E.2d 

545 (1969); and State ex rel. Warren v. Musbaum, 59 Wis.2d 

391, 208 N.W.2d 780 (1973) (where the questioned provision 

included the sentence about the governor including a 

deficit in the reserve fund in a future budget, not the 

sentence requiring an appropriation by a future legislature. 

It did require a bill to pay the same to be introduced 

in future legislatures, which the court said was a nullity. 

Nevertheless, on the theory that the included provision was 

a legislative attempt to invade executive authority, the 

provision was held to be unconstitutional and a nullity)." 

In Gibson the Oregon court found the equivalent section to section 

35-517 in the Oregon statute to be unconstitutional as a violation of that state's constitutional provision equivalent to Art. 

VIII, Section 8, 1972 Montana Constitution. The Oregon Supreme 

Court in an original proceeding, In the Matter of the Constitutionality of O.R.S. 456.720, (Ore.1975), 537 P.2d 542, 545, found 

that the section, after an amendment which removed the mandatory 

direction to the legislature to appropriate funds and replaced 

it with permissive language, was constitutional. It pointed out: 

"Intervenors regard the presence of a make-up provision 

as a pledge of the state credit because a bond dealer or 

vendor of certificates would point to the statute as an 

assurance to potential buyers of the certificates of 

indebtedness, that if the source of payment of the certificates should prove insufficient, a future legislature 

would come to the rescue with an appropriation of state 

funds to prevent or overcome a default. Certainly the 

purchasers of the bonds cannot predicate such an expectation upon any legal obligation of the state because the 

bonds themselves are required to contain a statement to 

the contrary. If there is a pledge, then, it is at most 

based upon a moral obligation which the members of future 

legislatures might feel to meet the deficiency. We do 

not interpret Article XI, $7 as prohibiting such a moral 

and therefore unenforceable pledge. * * *" 
Montana's version of this section is permissive in its direction 

to the legislature and it is clear the Forty-fourth Legislature 

did not bind a future legislature appropriate money. 

Third Section 35-517 presents a second difficulty due 

to the mandatory language in its direction that the governor 

include the Housing Board's appropriation request in his budget . 

In State ex rel. Warren v. Nusbaum, 59 Wis.2d 391, 208 N.W.2d 

780, the Wisconsin Supreme Court found such a mandatory direction 

violated that state's constitutional provision which said the 

governor "shall communicate to the legislature, at every session, 

the 

the condition oflstate, and recommend such matters to them for 

The 

their consideration as he may deem expedient." /equivalent section 

the 1972 Montana Constitution, Art. VI, Section 9, provides : 

"Budget and messages. The governor shall at the 

beginning of each legislative session, and may at 

other times, give the legislature information and 

recommend measures he considers necessary. The 

governor shall submit to the legislature at a time 

fixed by law, a budget for the ensuing fiscal period 

setting forth in detail for all operating funds the 

proposed expenditures and estimated revenue of the 

state." 

The Constitutional Convention Notes point out that the difference 

between this section and the corresponding section in the 1889 

Montana Constitution' is that: 

"Makes it mandatory that Governor send budget 

to legislature. Otherwise no change except in 

grammar. I I 

This Court in State ex rel. Normile v. Cooney, 100 Mont. 

391, 403, 47 P.2d 637, stated: 

"'The separation of the government into three great 

departments does not mean that there shall be "no 

common link of connection, or dependence, the one 

upon the other in the slightest degree1''(&8tory's 

Commentaries on the Constitution, sec. 525); it means 

that the powers properly belonging to one department 

shall not be exercised by either of the others. (Const. 

Art.IV, sec.1.) There is no such thing.as absolute 

independence. ' " 

- 12 - 
Budgeting is one-of those common links. The executive depends 

on the legislature for funding and because the legislature must 

set the state's budget in a ninety day session every other year, 

and because this is a period when there are numerous other matters 

to attend to, the legislature must also rely on the executive to 

provide the information it needs to budget intelligently. By 

statute, section 79-1015, R.C.M. 1947, the governor is required to 

submit the budget in a certain form with specified contents. 

The governor is prohibited from altering any legislative appropriation request by section 79-1013, R.C.M.1947. 

It is this difference, the mandatory budget requirement, 

that creates the difference between Montana and Wisconsin. There 

was no constitutionally prohibited invasion of the executive's 

power when the legislature required in section 35-517 that the 

governor include the Housing Board's request in his budget. 

Fourth Difficulty presented by section 35-517 is also 

whether an appropriation made pursuant to that section would 

violate Art. V, Section 11(5), 1972 Montana Constitution which 

reads : 

"No appropriation shall be made for religious, charitable, 

industrial, educational, or benevolent purposes to any 

private individual, private association, or private corporation not under control of the state." 

This is one of the sections of the 1972 Constitution directed 

to the legislature. Art. V, Section ll(6) allows challenge on 

the ground of noncompliance with the section only within two years 

of a statute's effective date. This challenge is within that 

time period. 

The predecessor section in the 1889 Constitution was 

Art. V, Sec. 35, which read: 
"No appropriation shall be made for charitable, 

industrial, educational or benevolent purposes to 

any person, corporation or community not under the 

absolute control of the state, nor to any denominational or sectarian institution or association. I1 

The Convention Notes indicate there was no change between the 

new and the old provision except as to grammar. It must'then be 

assumed the 1972 Montana Constitution expresses the intent of 

the framers more precisely. This is significant because there 

are differences in the wording of the 1889 and 1972 sections. 

The 1889 section had the word "ab~olute'~ before the word "control1' 

and the 1972 section adds the word "private" before person, 

association, and corporation. In Veterans1 Welfare Comm'n v. 

V.F.W. & D.A.V., 141 Mont. 500, 510, 379 P.2d 107, this Court 

in discussing the difference between a line item appropriation to 

the private veterans' organizations and appropriations to the 

housing authority in Rutherford and to the Montana Armory Board, 

in Geboski v. Montana Armory Board, 110 Mont. 487, 103 P.2d 679, 

said: 

11 1 However, the distinction between those cases and 

the case at bar is the distinction between a private 

corporation and a public corporation, the functions 

of the latter of the two being under the control of the 

state. In all three of the cases above referred to the 

court was careful in pointing out that the agency was a 

public corporation under the control of the state and 

in the nature of a municipal corporation. 'I1 

The Montana Housing Board is not a private corporation, it is a 

public corporation. It received all of its powers directly from 

the legislature and its duties and responsibilities are set out 

clearly by the statute which created it. Art. V, Section 11(5), 

1972 Montana Constitution, is not applicable to appropriations 

under section 35-517, R.C.M. 1947. 
Fifth Plaintiff alleges the Housing Act of 1975 entails 

an unconstitutional delegation of legislative power violating Art. 

V, Section 1, 1972 Montana Constitution. The Court stated in 

Milk Control Board v. Rehberg, 141 Mont. 149, 161, 376 P.2d 508: 

"* * * Concerning adequate standards and guides in 

delegation of legislative power, this court has stated 

the rule as follows: If the legislature fails to 

prescribe with reasonable clarity the limits of power 

delegated to an administrative agency, or if those 

limits are too broad, its attempt to delegate is a 

nullity. 

"On the other hand a statute is complete and 

validly delegates administrative authority when nothing 

with respect to a determination of what is the law is 

left to the administrative agency, and its provisions 

are sufficiently clear, definite, and certain to enable 

the agency to know its rights and obligations." 

In this case, plaintiff argues the statute is too vague 

as to the term "persons ard families of lower income". The 

legislature set out its definition of this term in section 35- 

"'Persons and families of lower income' means persons 

and families, with insufficient personal or family 

income who require assistance under this act,' as 

determined by the board, taking into consideration: 

"(a) the amount of the total personal and family 

income available for housing needs; 

" (b) the size of the family; 

"(c) the eligibility of persons and families under 

federal housing assistance of any type based on lower 

income or a functional or physical disability; 

"(d) the ability of persons and families to compete 

successfully in the normal housing market and to pay the 

amount at which private enterprise is providing decent, 

safe, and sanitary housing; 

"(e) the availability and cost of housing in 

particular areas; and 

If(£) nkeds of particular'persons.or families due.to 

age ,or physical handicaps .I' 
All that is left for the agency to do to place a figure 

on the income limit for "persons and families of lower income'' is 

to inquire into the facts as the statute directs and make the 

determinations required by the statute. The agency has heeded this 

legislative directive and adopted a program rule which sets out 

these same basic considerations in greater detail. See: M.A.C. 22-3.18 

(6) S1840. Pursuant to this program rule the Housing Board adopted 

$16,000 as the upper limit. We note here (1) this Act is aimed 

at a specific category of persons, those whose income is stable but 

because of the high price of money cannot afford to buy a home. It 

is obvious those with little or no income cannot afford to purchase 

a home no matter how low the interest rate; (2) the factual bases 

of the determinations made by the Board constantly change and the 

legislature meets only once every two years. The agency may meet 

as often as is necessary and may change the income level as the 

facts which serve as the basis for its original determination change. 

The delegation of this power does not violate any constitutional 

prohibitions. It is a clear, definite, and certain direction to the 

agency which enables the agency to know its rights and obligations. 

Sixth Plaintiff charges the flow of funds under the Act 

violates Art. VIII, Sections 12, 13, 14,1972 Montana Constitution. 

The Housing Act of 1975 provides for two methods of creation 

and issuance of its revenue bonds, by resolution as set out in section 

35-508(1), or by trust indenture as set out in section 35-513. 

The bonds issued under the first procedure (section 35-508(1)) 

would follow a complex procedure for deposit with the state treasurer 

in the state fund with accounts in various state fund accounts and 

parallel act accounts.Bythe alternative provision (section 35-513), 

the funds would be handled by much the same system but the proceeds 
from the bond sale would be handled by the trustee. Section 35-513, 

R.C.M. 1947, provides in pertinent part: 

'I* * * A trust indenture may contain provisions for 

protecting and enforcing the rights and remedies of the 

bondholders as are reasonable and proper and not in 

violation of law, including covenants setting for the 

duties of the board in relation to the exercise of its 

powers, the custody, safeguarding and application of all 

moneys. The board may provide by a trust indenture for 

the payment of the proceeds of the bonds and the revenues 

of the trustee under the trust indenture of another 

depository, and for the method of disbursement, with 

safeguards and restrictions as it determines. * * *" 

This method is consis tent with section 79-306(3), R.C.M. 1947, 

which states: 

"Nothing in this chapter shall impair or otherwise 

affect any covenant entered into pursuant to law by 

any agency or institution respecting the segregation, 

deposit, and investment of any revenues or funds pledged 

for the payment and security of bonds or other obligations 

authorized to be issued by such agency, and all such funds 

shall be deposited and invested in accordance with such 

covenants notwithstanding any provision of this chapter." 

The chapter referred to is entitled "Deposit and Investment of 

State Funds". The constitutional provisions which plaintiff argues 

these procedures violate require that the legislature shall by law 

insure strict accountability of all revenue received and money spent. 

The chapter provides for a unified investment program and requires 

that there be an appropriation made by law, and a warrant drawn 

by the proper officer before money be paid out of the treasury. 

It is clear the legislature provided by law for strict 

accountability of the funds. A proper trustee for the bond revenue 

is required and there are provisions which authorize a legislative 

audit at any time of the Board's books and a yearly audit. The trust 

indenture requires a monthly report to the state treasurer as to 

all indenture funds and bonds of record and accounts must be kept 

and be open to inspection by the state treasurer, the trustees and 

holders of more than five percent of the outstanding bonds. 
The Constitution's provision for the unified investment 

fund does not require that all agencies participate regardless 

of the nature of the agency. Where, as here, the agency is not 

using state funds and is setting up what amounts to its own specialized investment fund with a particular purpose, it is reasonable 

to allow, as the legislature did, the agency to take care of its 

own funds in a manner appropriate to its function. 

The Constitution's provisions for payment out of the 

treasury only on a warrant and pursuant to an appropriation presents no problem, for the trust indenture funds are not deposited 

with the treasurer and the funds received from the sale of the 

resolution bonds are by statute deemed continuously appropriated. 

Section 35-52 q1 c), R.C.M. 1947. 

This Court discussed a similar provision in Geboski v. 

Montana Armory Board, 110 Mont. 487, 493, 103 P.2d 679, where it 

said: 

"Section 14 relates to the method of handling the 

deposits of (f) state monies. The money raised here by 

the sale of bonds becomes a special fund to be disbursed 

for the erection of proposed buildings. This money is 

not derived by taxation and consequently need not be 

handled in that manner." 

Seventh The last issue raised is the conflict between the 

Housing Act of 1975 and section 5-1037, R.C.M. 1947, which prohibits 

state banks from borrowing funds without prior approval of the 

department of business regulation. Here, recourse to the rule of 

statutory construction which provides that where a specific statute 

conflicts with a general statute the specific controls over the 

general to the extent of any repugnancy. State ex rel. Browman v. 

Wood, - Mont , , 543 P,2d 184, 32 St. Rep, 1136; Montana Ass'n 

of Tobacco and Candy Distributors v. State Board of Equalization, 

- 18 - 
156 Mont. 108, 476 P.2d 775; In re Stevenson's Estate, 87 Mont. 

486, 289 P. 566. It is clear that state banks may participate 

in the Housing Board's programs without the prior approval of the 

department of business regulation because the legislature by its 

definition of "lending institution'' clearly intended to cover 

state banks and thereby made the necessary determination that state 

banks may participate. 

A declaratory judgment is entered in accordance with the 

foregoing opinion. 

n 

We, Concur: f I 

Mr. Justice Frank I. Haswell, took no part in this Opinion.