OFFICE OF THE ATTORNEY GENERAL OF TEXAS

i AUSTIN

Honorable C. Be Cavne88 State Audltrr Awtln, %~~X.WI

Dear Mr. cavnear:

ts far our oonsldorar Retirement sy8ta3o OOQpt th0 State'8 sentributlens to the 0~08 Of stats are paid In whcle tho gonoral revenue fund* ed vhehher 8uoh warrants

Fund warrant8 are

ostlon,we would observe in tb beglna8 &3nnSlal

f+tXtd liarl'&nt8

am payable Of this StatO. It i8 tPUe that they order sf lssuanoe,and that bwauss enoy of revenues 8upporting the fund, It ths after 188uanoe of general revonuswarrant8 before the State is able to redeem thom in Oa8h.

Statevarranta do not oonitltutspayment of the oblig8tions they are drawn to oover; their i8sWMIOe doe8 not discharge th8 obligation topay. They an merely order8

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Honorable C. H. Cevne88, Page 2

dravn by one ef the Slsoal offloors of the governmentupon another, directing the latter topay out of named funds, when available, 8 8peoified 8um to a named per8en, Payment of the salary of an employee OS the State OS TeXa8, thereSore, Is accomplishednot by the 188uanoe of a warrant whereby the Treasurer Is directed topay him 8 oertain EUP, buud18 oonsummsted only by redemption of the

### warrant80 lsl With tho above prinolples Inmind, ve would examine the followingprovi8lon8 of the Teaohor RetirementAot which ve OOn8idOrpertinent to the inquiry submitted In yo\rletter:

"sec. 8
"1C The Teacher Saving FPnd. '(8) The Teaohher Save She11 be 8 fund In which shall be eoa ted regular five (5) per OentUn contributions from the ooapensetlen ofmemb8r8, including OIIrrent interest earnings* Contributionsto and payments from the Teaoher Saving Fund shall be made a8 Sollow8: "(b) Bach employer shall oauae to be deducted from the selery of eaohmember en each and everypay roll of such emplo
ser Ser each Andyeverypay rollperiod, Site 5) per oentum of his earnable compensation,prevlded th8 t the 8x.811 of the deduction8madj for a member shall not exceed Cne Hundred and Eighty Dollara ($180) during any one (1)year. Deductions shallbegin vlth the firstpay roll period of the 8ChoOl year 1937-38. In determining the amount 

### earnable by a member In 8 pay roll perled, the State Board of Trmsteeamay Consider the rate ef annual eompensatlonpayable to 8uc.h member on the first day of thepay roll period a8 continuing throughoutsuchpay roll peried, and it may omit deduction from compensation for any period less than

### a f'ull

pay roll period if a teacher vas net 

### a member on the first day of thee roll period, and to Saoilltate themaking efHonorable C. Ii.Cavnea8, Page 3

deduotl~s, It 8u1~ m~$lfy the deduotlon re-

_ -- q~lred Of any member by 8~On an amOullt es SILSll not exceed one-tenth (l/10) of one (1)per oent\rm of the annual compensationupon the basis of whioh such deduction Is to be made* "(c) The deduction8provided for herein 8hall be made notwithstanding that the mlnhum colnpensetlon

provided for by law for any member shall be reduoed thereby* Every member ahall be deemed to oonsent and agree to the deduotlonsmade and prevldod for herein and Shafl:recelpt for his full selery or 00Plpen8etlon, and payment OS salary or OO~eMbtiOn. le88 said deduction. c&all be a Sull and OOmDlete dlscharge and acqulttanoe of all alaim and de8ianda whataoovorSer the sorvloos ronderodby such persoll

during theperiod oovered by suoh payment, except es to the benefitsprovided under thl Act. The employer shall certify to the StateaBoard of TIW8tOeE 0x1 each and every pay roll, or In such othermanner a8 eeld Board may presoribe, the amount8 to be deducted; and -whendeducted shall be paid into said Teacher Bavlng Fund, and shallbe credltod, to the Individual eocount of themember frolp whose oompensatlen said de&uctlonwe8 made. "

. . . . “8. Celleotion

### or Contributionso "(1) The oolleotl0n of members3 contributiOM.8hall be aa r0il0vs: 

### "(a) Each employer shall cause to be deducted on each and everypay roll of 8 member for each and everypay roll period subsequent to the date of establishment 0S the Retirement System the contributionspayable by suchmember, as provided In thisAct. Each employer shall certify to the treasurerQS 88id OmplOyOr on each and everypeg 

### rolla statementes vouchers for the amount 80 deducted*

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Honorable C. Ii.CsvneIsL), Page 4

"(b) The treasurer or proper disbursing offlceti

of each employer on authority from the employer shallmake deduotions from salaries of teachersa8 provided in thisAct, and ahall transmitmonthly, or at such t&no as the State Board of Trustee8 shall designate, a certified copy 0s thepay roll, and the amount 8peoified to be deducted shall be paid to the Executive Secretary of the State Board of Trustees,and after making 8 record of 811 reoelpts, the said Board shallpay them to the Treeaurer of the State of Texas, and by him be credited to Teeoher Saving Fund, and euch funds shall be deemed as epproprlated for we according to theprovisions of thisAct. For thepurpose of oolleoti.ng contributionsof teaoherswho are teaching in common schooldi8triCtS, the oounty auperintendent or ox officio county superintendentof eeoh cehnty OS this State 

### is hereby designated toperform the dutlea of employer of all oo?mwm 8chool district8 ever vhich he has jurisdiction, and he ia hereby authorized and empiwiered to retain the amounts 80 deducted from pay rolls of hremberaand have a correapondlngamount deducted from any funds available for paying teachers1 (ralarles,

and transmitmme to the Exeoutive Seoretary of the State Board of Trustees a8 prevlded for In thisAct. Any dbllege or unlveraltp or other educationalm%itutlon or agexmy orted in whole or In part by the State sha ve theamount retalned or deducted Zrem the tida regularlyappropriated by the State for tie c%rrentmaintenanoe for such eduCationa departments end instItutiona.

n

. . 0

. "(8) The State Tpeasurer shall furnishannually to the State Board of Trustee8 a sworn statement of the amount of the funds in his custodybelonging to the Retirement System. The records of the State Beard of Prustees shall be open topublic inspectionand any member of the Retirement System ahall be furnishedwith 8 statement of the amount to the credit of hi8 individual

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Honorable C, H. Cavness, Page 5

account upon written requestby suchmember, provided that the StateBoard of Trustees shall not be required to answer more than one euoh request Of a member in any one year.” (&pha8ls supplied) (Sea. 8, Art. 2922-1, Vernon’s Civil Statutes,as amended by Chapter 377, Acts 48th Legislature).
A8 to “any college or university or other eduoatlonal institutionor agency supported ln whole or ln part by the State,” the act expresslyprovidea that the amounts required to be retained or deducted shall be retained or deducted “from the fund8 regularlya~rlated by the State for the current sw$.ntenanoe for such eduostlonaldepartment6 and lnstltutlons.

Obvlouaiy, It was oontemplatedby thisprovision that the suma deductibleunder the act from the compensation of persons employedby the State es employer shouldbe retainedby the officials representing the State in thepayment of his salary. It was not within the contempletlonof the act that the S’unds required to be retained shouldbe paid to the employee, or that he should be required to advance the amounts from his pereonal funds; certainly It Is beyond the terms or intention of the act thathe shoold be required to advance the amount8 to the Teacher Retirement e In advance of the time the Statepays his salary to

. The objectionhas been raised that IS the Teacher Retirement System accepts general fund warrants,no lnvestment can be made of the sum8 representedby theverranta uutll the time they are paid, and further that the fundmight be required topay over, ln cash,moneys towlthdravlngmembeI- in advance of the time thewarrant8 actually are payable. Relther objection Is tenable: there can be no obligationon thepart of the offlceramanaging the Fund either to invest money8 before they are receivable, or to returnmoney8 prior to the time of actual payment into the fund.

You are respectfilly advised, therefore, thatunder the express terms of the Teacher RetirementAct, it la the duty of the employing agencies to withhold and retain thelems deductible under saidAct from the salaries of persons employed



# b

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Honorable C. H. CavneBs, Page 6

by the State. Such f’unds are not to be paid, nor are warNlsts for the deductible Items to be payable, to the Individual,but the 8ame 

### am to be retainedby the State, in the hands of its 

### OSfiOer8,and transferred to the appropriate accounts of the Retirement System “from the fund8 regularlyappropriated for the currentmaintenance” of the departments 

### or Institutionsaffected,
To the extent that our opinion O-5492may be considered to be In conflictherewith, the earlier opinion Is aocordlnglymodified.

Very trulyyours
ATTORKEY QEI4ERAz,

OF TEXAS

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