MARK WHITE Attorney General 

# The Attorney General of Texas

May 6, 1981
Honorable Ray Farabee, Chairman Senate Committee onState Affairs Austin, Texas 78711 Honorable Gerald Hill, Chairman Committee onElections House ofRepresentatives Austin, Texas 78711 Opinion No. W-333 Re: Constitutionality of C.S.H.B. 889 concerning direct &posit of payroll warrants by magnetic tape transfer service

Dear Senator Farabee andRepresentative Hill: You have requested our opinion regarding the mnstitutionality of House Bill 889, presently pending in the 67th Legislature. The bill would amend article 43444 V.T.C.S., by adding the following provision:

Notwithstanding the provisions of any other statute, the Comptroller ofPublic Accounts may establish and operate an electronic ftmds transfer system only to transfer employees gross state salaries less deductions specifically authorized by state or federal law or reimbursement for travel and subsistence of employees or [payment?] to state contractual payees to satisfy state contracts directly into their accounts in financial institutions. An employee or state contractual payee must request in writing to participate in any electronic ftmds transfer system established andoperated bythe Comptroller ofPublic Accounts Asingle transfer may contain payments to mutiple payees without the necessity of issuing individual warrants for each payee. The Comptroller shall establish procedures for administering the system and may use the services of financial institutions, automated clearinghouses and the federal government. The use of electronic ftmds transfer or any other payment means does not create any rights that would not have been created had an individual state warrant been used asthe payment medium. The State Treasurer may not make a payment of a state employee’s salary before the last working day of the payroll period. p. 1079. -

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Honorable Ray Farabee Honorable Gerald Hill Page Two @I+3331

The state treasurer contends that this proposal, ifenacted, would contravene article 4, section 23,and article 3,sections 50and 51ofthe Texas Constitution. In Attorney General Opinion MW-213(1980), we said that, while existing law permitted the comptroller, at anemployee’s instruction, totransfer the employee’s pay warrant directly to his designated bank, there was no statutory authority for the comptroller to issue to a bank a pey warrant covering multiple employees or to issue warrants solely by means ofmagnetic tape. HouseBill 889furnishes such authority. Article 4, section 23 of the Texas Constitution merely establishes the office of state treasurer and directs that he“perform such duties as are or may berequired by law.” Noduties ofthe treasurer are specified inthe constitution, and, inour opinion, the legislature is at liberty to reasonably determine the scope of his duties. The provision ofthe bill directing the comptroller to “establish procedures for administering the system” merely makes it his duty to conform the use of electronic “warrants” as nearly as may be possible to the statutory requirements governing the issuance and control of paper warrants. The existing statutes flsnish sufficient standards to guide hisdiscretion. The sentence prohibiting the State Treasurer from making apayment of a state employee’s salary before the last working day of the payroll period is confirmation that the bill does not attempt to change the traditional role of that constitutional officer. Nopayment may be ma& from the treasury except at his direction. Article 3,section 50ofthe constitution prohibits the legislature from lending or pledging the credit of the state for the liability of any individual, corporation or association. Article 3, section 51prohibits the grant of public finds to an individual, corporation or association. In our view, neither of these provisions is subverted by House Bill 889. See Attorney General Opinions MW-55 0979); H-74 (1973). Accordingly, it is otii$nion that House Bill 889, if enacted, would be upheld as constitutional asagainst the objections raised. SUMMARY House Bill 889, presently pending in the 67th Legislature, does not contravene article 4,section 23orarticle 3,section 50 or 51ofthe Texas Constitution.A*

Attorney General ofTexas

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Honorable Ray Farabee

Honorable Gerald Hill Page Three (rw-333)

JOHN W.FAINTER, JR. First Assistant Attorney General RICHARD E.GRAYIII Executive Assistant Attorney General Prepared byRide Gilpin Assistant Attorney General APPROVED: OPINION COMMlTTEE Susan L.Garrison, Chairman Jon Bible Rick Gilpin Jim Moellinger Thomas M.Pollan

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