OFFICE OF THE ATTORNEY GENERAL OF TEXAS 

AUSTIN 

February 17, 1939 

lion. J. IL McDonald, Cd86iOner 

Departillmt of Agrioll1tulv 

Aunt&n, Tour 

urmant to tha prof House Bill No. 664, 

Vera8 Cltrua Market- 

* Article 5764a or 

Revised Civil Eltatutea. 

tsr of February 

on to various 

RI *Texas Citrus 

Vernon's RevlSed 

on the tollowfunotlonlng of the marketing agraemOnt 

ad into under the Toxam Citrus Marketing Aot 

be 80 reported to the Gtatr Ccanptrollsr an& 

dsposited.in the State Trea8urg.w 
Hon. J. IS. MoDonald, ?sbruary 17, 1939., Page 2. 

Par ths purpose of snswerlng the above Inquiry, 

we have also taksn Into ccmlasratlon the tows and 

provisiona ot the amended Marketing Agreement regulating 

the handling of citrus fruit grown In Cameron, Eldalgo 

and Uillacy Counties between the handlers of citrus fruit 

In this ares and the Commlsslonsr of Agrleulturs of the 

Stats of Texas. 

Sootlon S ot the Marketing Aot sonstltutss 

the authority and power of the Commfsslonsr of Agrlculturs for sntsring Into a Cltrus~Markstlng Agreement. It 

reads as follows: 

Vubjeot to the provisions of this Aot; 

the Commlsslonsr Is hereby authorized and smpowered to execute marketing agreements and 

to lssus lloenssa under this Act to persons 

engaged in transaotlona or Intrastate oommsros 

wlthln the areas of this Stats in the markstIng, proossalng; packing, shipping, handling 

or distributing or citrus iNitS." 

Section 0 (1) of the Marketing Aot provides 

for the crsitlon of *an admlnlatratlvs coa@ttss or 

oommittsss * by the terms of any Marketing Agrsemsnt, 

sxecutsd under the Act in the following language: 

OY(arkst.lng arssmsnts sxsoutsd and llosnsss 

lssusd under this Act, shall, in addition, 

oontaln one or more of the following terms 

and eondltlons: 

'(1) Proriding ror the sslsotlon by the 

CommissIonor, or a method for the sslsctlon 

by the Commlsslonsr, of an admlnlstratlvs committee or oommlttdss and defining their powera 

and duti0s.m 

Ssotion 0 (1) of the Aot further defines and 

limits the powers ai such admninlstratlvs oomnlttes, towit: 

(a) To admlnlstsrlng suoh llosnse In aocordanos with its terms and provisions; 

(b) To making rules and regulations to 

effectuate the terms and provlslons oi suoh 

license; 

. 
Eon. J. IL irrcDonsld, February 17, 1939, Pegs 5. 

(.o) To rsoslvlng, lnveatlgatlng and rsporting to the Coamiaslonsr aomplalnta of vlolatlona 

or auoh llosnsa; 

(d) To rscaamtendlng to the Commlaolonor 

amsndmsnta to auoh llasnas; 

(01 To oollsotlng from sash handler a fee 

or l aasaamsnt rspreasntlng his prop rata aharo 

of ouch oatlmgtsd expdnesa, Lncludlng sxpenasa 

incurred In hearings held on, and In the oxsou- 

.tlon of l uah marketing agrssnmnt, aa the Commlaalonsr, after the autiasion to him by auah 

l dmlnlatrative agsnoy or agencies 0r a proposed 

budget, find0 will probably bs required to oovar 

sxpsndlturaa naoaaaarily to bs Incurred by 

auoh~mgenay or agendaa, during any psrlod 

l pscilflad by him, for the amlntsnsnos and 

funotlonlng of l uoh agsncy or agencies; to 

rsuoaivlng, expending and aooountlng ror the 

funds r0 aollectsd, and to ret- to ouch hsndlsr 

hi8 pro rata ahars of any unexpended balances 

which the admlnlatrstlre sommlttss or oommlttes8, 

wlththe appkvsl of the Commiaalonsr, flnda 

am not 80 rsqulrsd;W 

We are aonasrnsd wlth the aonatruotlon of the 

above quOt8d rub-heading ~(81 of Section 0 (1) of the A&. 

It dsflnss the powers of ths l dmlnlatratlva 

oonmlttee under the Marketing Aat, rslatlva to an dalnlatmtlon or an operating fund. Hrat,, the aamulttss 

la authorized to aollsot from each handler of oltrua a 

re0 or,asasasmsnt rsprsssntlng that handlsrqa pro rata 

ahers or the estimated sxpsnee of admlnlatsrlug ths 

Karkstlng Agreement. The amount of assessment la baaed. 

upon a budget prepared by the oommlttea and approved by 

the Coamilsafonsr or Agrioulturs for a rlsoal period 

dealgmtad by him. Said amount la to be dstermlned by 

t&s Cozamlasloner or Agrloulturs. said budget la dealgnsd to ccivsr all sxpsndlturss whloh night nsosssarlly be 

lneurrsd by the oommlttss In admlnlatsrlng the terms and 

prwlalona of the Act. 

Ssoondly, after aubmltting the budget to the 

Coanmlsslonsr of Agrloulturs and oollsotlng the aaaeaamsnt 

or fee deolded upon by ths Lhmniaaionsr, the aamittsa 16 

- . 
Hon. J. X. MaDonald, February 17, 1939, Page 4. 

eivsn the power oS *rsoslvlng, sxpsnding, and aocounting 

for the funds so oollsctsd.~ 

Finally, In sold Ssotlon 8 (l), (a) It la the 

duty of the aomnlttss to return to each contributing 

handler his proportionate share of any unexpended balance of the administration fund, which the oommlttsa 

or Cwnmlsaloner of Agriculture flnda wlll not be needed. 

The language of sub-baading (a) of Section 

8 (1) of the Act, In ooncluaion, authorizes the committee 

let, to rscslva the asasaamsnta levied by the Ccannlal io nsr on the baala of the canmlttss~a own rscomasndation; 2nd.,'to sxpsnd ouch funds and give sn acoountlng; 

and, 3rd.. to return to the handlers any balance mloh 

the oommlttss and Comlsslonsr of Agriculture declds 

la not required to meet the expsnsss of any fiaoal period. 

Section 8 (11, (a) thus gives the adminlstrstire aomulttas, set up In the Karkstlng Agreement, 

l xtanalvs aontml over the operating fund rslaed by 

aasaaaamnt, lncludlng the power to Bake dlaburesmsnts 

therefrom. 

Section 16 (21, however, while further dssigna4- 

lng uld aollsctsd funds for the purposes set out In the 

Marketing Agreement., requires that a record be kspt and 

a raport be filed with the Commleslousr of Agrlculturs 

rr0m time to tlnks. It reads an follows: 

-AAny funds oollsatsd by the admlnlstratire agsncy from the levying of auah Sees and 

asaseamsnta shall be used forth8 purpose set 

forth In the marketing agreement or license 

under which It wss oollsctsd. A full and aomplate racord thereof shall be kspt to which 

the Commissioner may hars'accsss at any 

time, and a report of the aotlrltlsa and proceedings shall be filed wlth the Commissioner 

Srom time to tlnm as ha may requlrs.n 

Thus far It la apparent from the tanas of the 

Marketing Act that the Commissioner of Agriculture, after 

exsmlnlng the proposed budget aubmltted to him by the 

administrative committee has the right to set the fee or 

sssssamsnt to be levied; that he hsa the right to approve 
Hon. J. 11. M?Donald, Psbruary 1.7, 1939, Page 3. 

the unaxpendad balance ab the admlnlatratlon fund to be 

dlvlded among the lundlera on a pro rata basis; and 

that he has the right to have l oceaa to the reuorda of 

the oom.lttee at any time and reoelve a report on the 

~~;~eand disposition of funds by the l &&xlatmtlve 

. 

Sootion 17 of the Marketing Act so&orb upon the 

Commiaaioner of Agrioulture l ddltlonal rights and powers 

in respect to the flnanoea of the l dmlnlatratlva aamalttee. 

It provider as follows:. 

(I . . . The Ccmmla6loner ahall thereafter exact 

and require, by requlaltlon on the appropriate 

l dmlnlatratlvs committee sr aommlttaaa, aharged 

with the oollaotlon sf funds for expanses under 

o uc h mr k etily l gma ma nt, th a t a uo h o o mdtta e or 

acamlttesa solleot, report, and pay wer monthly 

to the Ccaamlaaloner the amount ~decamd nsoeaaary 

and aufflclent, and raquialtloned from auoh 

l drinlstmtlva amanittee or aorenitteaa by the 

Caumlaedoner, to defray the aotual expenses 

of the Commlsalomr to be lnourrsd during the 

subsequent month in the admlnlatmtlon and 

enforcement of any auoh narketing agreement or 

lloenae, under ouch rules and ra(pllatlona as 

ha may pmaorlbs.’ 

We oonatrue said prmlalon to men that the 

Carepiaalonsr oS Agticulture la entitled to reoelve from 

the adminlatrati on fund any auoh amount of money as he 

oalaulates la nscsaaary and auSSloient to aover ouch 

aotual l xpenaea a0 hs, In hls orrioial oapaclty a0 Coa+ 

miaalonsr of Agriculture and ths Departxnent of Agrioulture, will Incur for the next ensuing month, in aamsatlon dth hla duties In admlnlatsring the Marketing 

‘ngraamant. 

It gives him the authority to requlaltlon the 

administrative oaPmittea, uhlah has aontrol war the 

operating run6 to supply him with au& l x P ense moneY. 

The l.mguage cf Seotlon 17 deelgnatea “the l otual UPOne 

or the Conrmiasioner .. . ln the a&alnlatmtion and enSoroamentw of the Marketing Agreement as the datemining 

amoUnt oS the raqulaltlon funds. 
Hon. J. B. McDonald, February 17, 1939, &is 6. 

'The aeoond paragraph Of Seatlon 17 deals rith 

aunusued, anexpended and unrequlaitlonsd aaseasmsnta~ 

In the r0ii0ting bmgi~g8: 

‘gut all monaya aolleotad from asaeasRents, or othsrwlae, lmpoaed;under thla Act 

and under msrketlng agreements executed In 

~*usnCs thereof,'or liaenaea ia6aued thsreunder, by the admlnlstmtlve odttes or 

0oarmnitteea created urdsr this Act, not reqUlaltlons6 by the Camulaalonsc for a&nlnla'trstire l xp wa es as herslnbetore provided In this 

Section, shall renaln In the custody of such 

admlnlatratlvs coanalttes or aonohittssa~untll 

the 0108s or the aurrsnt ma*stlng *es*on or 

year for which asms was oollscted (not to extend further thsn the psrlod covered by ouch 

marketing agreement), at which time the a&Inlatmtlve committee or ooarmittsss ahsll return 

to much handler or handlers his pro rsta share 

of ouch unususd, unexpended and unrequlsltloned 

aaaeairmsnt or asaessmsnta.~ 

Conetxulng Sections 8 (1) (8) and 17 Of the Act 

together, It la apparent that the operating fund conposed 

of aaeeaamsnta or tees levied on the jnndlera by the 

a&zlnlstratlve ooormittss la aubjsot to three uses. 

(1) It la aub)ct to be raqulaltloned 

on a monthly baa18 by the Commlaslonsr oi 

Agriculture for an amount neusssary to cover 

hla expsnasa and the expenses of his dspartrent inourred through his bslw a psrty to 

the Marketing Agreement. 

(2) It la subject to the authorized axpendlturea of the aommittss 1 Section 8 (1). (a) 1 

charged with the adnlnlstrstion of the Ksrkstlng 

Agreemnt set up under the Act. 

(3) If at the alose cb a rlacal period, there 

r-ins any unususd, unexpended or ~SqUiaitlOnad portion or the operating fund, said balance 

is dlv:ded among the assessed handlers, eaah 

handler rsoslvlng hls pro rata share Of said remaining rund0. 
Hon. ,J. X, HoDonald, February 17, 1939, Page 7. 

Seotlon 18 (1) relates to the moneys requlaltlonsd by the Canml,asloner of Agrlaulture from the 

opsmting fund in the ouatody of the adminlatrstlvs 

oommlttee. It provides that: 

*All moneys reoslved by the Commlsslonor hereunder ahall be by hint, at thcend of 

eaoh month, reported to the State Comptroller 

and at the same time depoaltsd In the Stats 

Treasury. All moneys so oredltsd are hereby 

l pproprlatad for use of eald Corqdssloner to 

be expended In accordance with lsw ln aarry- 

%ng out the ~provlalona hsraof.W 

Seotlon 18 (X) requires the bommlaslonsr of 

Agrloulture to *submit quarterly to the admlnlatratlvs 

l genoy umisr eaoh msrkstlng agreemsnt or license a 

aomplete statement of reeslpta and expenditures in 

aonneotlon rith the admlnlatratlon of each marketing 

agreement or license during the querter.w 

It la our opinion that the lsglalatlve lntent behind the Act wss that both the Commlaalonsr 

of Agriaulture and the a&lnlatratlve agenay, 

oreatsd under the a@irksting agreemsnt, be authorlaed 

and mpowersd to make neoeaaary l xpsndlturea aonnected 

with their respective dutlsa and functiona In aarrylng out the terms and provl~ona of a m?trketlng 

agreamsnt. Provlalon la made, both for a aheck by 

the Commlaalon6r upon the l xpsndlturea of the oommlttee and an accounting by ths Commissioner of 

Agriculture to the admlnlatratlve aonmlttee of hle 

receipts and expenditures. Since the Commlsslonsr 

af Agriculture la a public offlolal and a State 

orri08~, the Act requires that moneys expsndsd by 

him be reported to the Ccmptroller and deposited 

In the Stats Treasury. The aommlttee, being a prlvats organization set up by a voluntary agreement, 

Is by authority of the Act a auatodian of the 

operating fund and may make axpendlturea of same 

without converting said moneys lntb public funds. 
Hon. J. X. XoDonsld, Iebrwmy 17, 1939, Page 8. 

Section 12 states l xpllclty that: 

sell moneys solleotad from aaasasmsnta . . . 

not requlsltionsd by the Commissioner for 

l dmlnia tr etiaxpsnaes V8 . . . shall remain In 

the ouatody of such l Qnlnistrstlve commlttss 

. . . a 

Thla applies not only to that portion of the 

unrequIaltlonsd funds to be returned to the hsndlsrs on 

a pro rata bssla, but alao to the moneys to be used and 

expended by the aommlttes In properly administering the 

tonne and provision6 of the agreement. 

The provlalona of the mrkstlng agresmsnt 

entered intc by the Commlsalonsr of Agriculture and 

the handlers ot cltrua fruit, grown In Cameron, 

Hldalgo and Xillscy Countles, austsln the construction 

we have placed upon ths atorsm~tloned asctlona of the 

Aot. 

Seotion 1 of Article 2 oS the marketing 

agrsamsnt areatss certain admInlatrstlve agenoles ln 

the r0iiaring language: 

*A Crooners Induatry CommIttee and a 

Shippers Marketing CommIttee are hereby 

established which shall admlnlatsr the ferns 

and provisions of this agresmsnt as hareInafter 8peOlflcally provided, and the 

membsrahlp of which ahall be selected 

In accordsnos with the provIsIona oS thla 

artlc1e.s 

Seotlon S (2) of said Article lists the duties 

of the Growers Industry Committee as follows: 

(a) to act aa lntswsdlary between the 

Commlaalonsr and.ths producers and handlers: 

(b) to furnish the CommIssIonor auoh 

available InSormstlon as he may request; 

(a) to appoint ouch employees as It may 

dssm nscsasary and to detsnnlne the salaries 

and dsrlns the duties aS any auah employsea; 

- . 
Hon. J. X. YcDonald, February 17, 1939, Page 9. 

(6) to osuas the books of the Groirera Industry 

Committee to be audited by one or more osrtlrled 

pub110 aooountanta at least once for eaoh orop 

year and at l uah other time as the Growers 

Industry Committee demo neoeasary or as the 

Canmlsslonsr may request, and to ills wlth the 

~~aalonsr coplea of all audit yports made; 

(0) to make .auch aatlamtss Or the total 

Crop8 oS fruit including the grads and alas 

6latrIbutlon ther8o.S as msy be deemed mceaaarg 

by said sommlttee In connection dth the 

administration of Articles IV and V hereof, 

or as may be prsaoribsd by the Commissioner. 

(f) to psrionn auah duties In connection 

with the aiLnlnlstrstlon of ths Tsxsa Citrus 

Xarketlng Act aa may from tlms to time, be aasigned to It by the Commlasioner.R 

Section 6 oS~ArtIcls 2 deqla with +m.ud8.R It states: 

*All funds received by the &owera Industry 

CcmmIttes, pursuant to any provisions OS this 

agreement shall be used aolsly for the purposes 

herein apecIfled and shall be aooountsd for In 

ths Sollwlng msnnsr: 

(1) The ComaIaslonsr IMP, at anytime, requlrs 

the Growers Industry Committee and Its mmbsra to 

account for all receipts and dlaburasmsnta. 

(2) Upon the rsmoval or expiration of the 

term or 0rriO8 or any member 0r the Growers 

Industry Canmlttes, such member ahall aoaount Sot 

all receipts and dlaburaemsnts and deliver all 

property end funds In his hands, together with 

all books and records in his possssslon to hIa 

aucosssor In office, and shall execute such aaslgumsnta and other instruments as msy be nscssea.rjr 

or appropriate to vsat ln auah auocsssor full title 

to all of the property, funds and claims vested In 

ouch mambsr pursuant to this agrssmsnt.a 
Hon. J. X. YoDonsld, February 17, 1939, Page 10. 

The lmpllaatlon throughout aald aectiona la 

that the Growers Industry Ccmualttee ht?iE full power to rake 

b diabursen~nta from the operating fund uhlch lt haa aollectsd 

l dl which rsmalns In Its austoUy. 

. 

Article 1x1 of the amended Marketing Agreement 

covers wexpenass and asseagPsnts.~ 

Seotlon 1 OS Artlole III provides that: 

Vhs Growers Industry Committee la authorized 

to inour.auoh expenses as the Gommlssloner may 

find t0 be necessary to oarry out the functions 

OS both aommlttssa unasr this agreement during 

the de8lgnsted fiscal period. The funds to aovsr 

ouch expenses shall be aoquirsd by the levying 

of aaasasrmnts upon handlers as hsrslnafter provided.* 

&Id section conSorme wlth tha requirements OS 

Seotlon 8 (1) (a) OS the Act which authorizes the oammittss 

to rake axpsndlturss on the basis of a budget submitted 

to the Commlaslonsr of Agriculture for a 8psolSlsd period. 

Gsotlona 2, 3, 4, 5 and 6 of Article III provide 

for acmputatlon 0r rate OS asas8amsnt, payment 0r same 

by handler, a proportionate refund, ldorsaas rate 0r aasessment and amlntensncs of suit by the Growers Industry Colnmittss 

toi aollectlon of hsndlsr*e pro rata share of the expenses. 

The above reasonI% and ofnstruatlon, placed 

upon the pertinent sections of the exas Citrus )Carksting 

Agreement and the amended Marketing Agreement, lead ua 

to the conclusion thst the Act requires that only ouch 

money8 is plight be rsqulaltloned by the COUimlSslOnSr Of 

Agriculture for the purposes of defraying axpsn8sa lnourrsd 

by himself and his department in administering the provlslons 

OS the Act be reported to the State Comptroller and 

de)oalted in the Stats Trsaaury.' 

It la our opinion that the admlnlstratlvs oommlttes 

.la legally authorized and empowered to msks necessary and 

aufflclsnt expenditures and ths Sunda whloh It uses for 

operating expenses may, under authority of the Act, remain 

In its custody, only the unexpended and unuaued portion bslng 

rsturnsbls to the handler8 on a pro rata basis. 
Hon. J. E. MoDonald, F8bruery 17, 1939, Page 11 

This deolsion overrules the letter opinion of 3. II. 

Broadhurst, Aesistant Attorney General, dellvsrsd November 3, 

1937 inrorar a8 it holds that @tha oommittee have no authority 

to expend any money 80 oolleotad l rospt by paying that amount 

over to the Commissioner of Agrloulturs, vrhioh has been raquleitloned by him* and *Iso the oplnlon of K. L. Williford, 

Aasf etant Attorney Goneral, Qrllvered September 13, 1938, to 

the ram@ efieot. 

Trusting that we have fully answered your inquiry, 

we arm 

Yours very truly 

ATI’ORNEY GENERAl OF-TEXAS 

BY 

Di& Stout 

Aesietant 

DS:ob 

APPROVED: 

ATTORNW GENERAL OF TEXAS