Honorable Julian Montgomery

StateHighway Engineer dusttn, Texas
Dear Sir: Opinion No. O-1968 Re: Legality of a plan of group insurance for employees of the Highway Department.
You have previouslyrequested an opinion of this department concerning the legality of a plan of group insurance for employees of the Highway Department. The'plan as previously submitted provided for the Issuance of a~~warrant by the Comptroller of PublicAccounts to the insurance company,which warrant would be made up of the various payments deducted from the salary warrants of the numbers of the insurancegroup. The proposed planwhich you submitted necessitated,as you stated fn your letter, the use of various employees of the Highway Department to facilitate the same. Therefore, this department, ln OpinionNo. o-1755, ruled that the plan could notbe put fnto effectbecause it called for the use of State employees for a private purpose.

In your letter of February 13, 1940, you have resubmitted your question concerning the legality of such a plan of group"insurance leaving out the objectionable feature of the first plan above pointed out. In your second letter you ask the following questions:

"(1) Would itbe legal for an insurancecompany to issuea policy of group insurance to employees of theHighway Department, which included life insurance? TheDepartment, of course, could not pay any portFon of the premium. "(2) Can any portion of an employee'swages or salary,when assignment has been given, be paid to someone else?" In,answer to your first question, you are advised tha~t Article 4764a of the Revised Statutes reads, In part, as follows: “Set 1:

. Group life insurance ishereby de'-Y

Honorable Julian Montgomery,page 2 o-1968

clared to be that form of life insurancecovering not less than 25 employeeswritten under a policy issuedto the employer, the premium forwhich is two be paid by the employer or by the employerand employees jointly

. . .'I
You are therefore advised that under the above.quoted Article group insurancewhich would include life insurance coveragemay.not be taken out unless at least part of the premium is pald by the employer. Of course; the StateHlghvay Department isunauthorized to make any suchpayment. You are thereforeadvised that such a proposedplan of group lnsurancemay not be adopted by employees of theHighway Department. The answer to your second. question presents a much more difficult problem. According to the plan submitted It would be necessary for the Comptroller of PublicAccounts to have the authority to issue a warrant to a third person In payment of a partial salary assignment. It is the opinion of this department that the Comptrollerhas no such authority and that he is allowed to issuea warrant only in the name of the employee himself. Our conclusion in this respect is based upon an analysis of our statuteswhich authorize the Comptroller to Issuepay warrants and authorFze hFm to keep books and records showing such payments. Article 4358 of Vernon's dnnotated Civil Statutes reads as follows:

"The'~Comptroller

shall have printed uniform pay warrants,which shallbe of three classes: 'general,' 'special'and 'pension.' Such warrants shaI1be prepared in duplicate, and shallbe marked"origina1' and 'duplicate,'respectively; and each class shallbe seriallynumbered and shallbe of a color of paper different from the other class. A separate .serFesof numbersmay be used for warrants Issued for payrolls to be paid from the General Revenue Fund, and forwarrants Issued for claims to be paid from 'highway'or other special funds,when the Comptrollerdeems such special series ofmembers advisable. Such warrants shall be prepared so as to provide for entering thereon in addition to other appropriate matters, the following: "1

. Initials of the person in the Comptroller's Department comparing the warrant with the claim. "2

. Designation of the fund againstwhich the warrant isdrawn.c -

Honorable Julian Montgomery, page 3 o-1968

“3

. Appropriation againstwhich disbursement is to be charged." Article 4359,V.A.C.S., reads in part as follows: "The Comptroller'shallprovide a pay warrant register for each class of pay warrants, each volume ofwhich shall be approprLatelydesignatedby class, number or otherwise. When a pay warrant is prepared, Ft shallbe'reglstered in the pay warrant register for the class to which itbelongs; and such reglstery shall-consist of an entry of the amount of the warrant, name of the payee, appropriation to which charged, and such other informationas may be deemed advisable by the Comptroller."
Senate Bill No. 427,Acts, 46th Legislature, 1939, is commonly called theDepartmental ApproprlatlonBill. Said Act provides in part as follows:

"Salaryand other ProvIsIons, (a) All annual salaries shall be paid In twelve (12) equal monthly Installments,unless otherwiseprovided herein.

. . . . "Salary Payments. No salary forwhich an appropriation ismade herein shall be paid to any person unless such person actually discharges assigned duties. Every month the head of each department shall attach to the payroll for his department an affidavit, under oath, stating that the persons listed in said payroll actually performed the duties forwhich they were being paid. The Comptroller shallnot lssue warrants for the payment of se'larles listed on said payroll unless this affidavit is filed with him. Each department haad shall number consecutively the salariedpositions inhis department for whkh an appropriation ismade herein (either out of the General Revenue Fund, fees, receipts, special funds or out of other funds available for use by saiddepartment) and opposite the number of the position, he shall set out the title of the position and the name of the person employed to fill the same. This statement.

shallbe filedwithythe Comptroller, who shall;when Issuing hiswarrant to any employee in payment of salarydue said employee, number the warrant with the same number that isHonorable Julian Montgomery,page 4 o-1968

assigned to the position filled by said employee...."
An analysis of the duties of the Comptroller in the issuanceof pay warrants as stated in the above quoted Articles indicates, ln‘the firstplace, that salaries are to be paid in twelve (12) equalmonthly installments. Each warrant drawn shall be paid only inpursuance of an affidavit fLled by~the head of a departmentwith the Comptroller. When the Comptroller issues thewarrant the same shall be numbered with the same number that is assigned to the position filled by the employee. It is to be noted-.in this respect that this portion of the General AppropriationBill reads:

"when Issuinghiswarrant to any employee In payment of salarydue." This language clearly indicatesthat the warrants are to be issued to the employees themselves. An accurate system is then set up'by which the warrants are registered by the Comptroller and records are kept on all salaries paidwhich records correspond to the actual warrants Issued.

It can be seen from the above discussion that the legislativeplan for the Issuance of pay warrants would be greatly~

hamperedby the Comptrollerhaving to recognize a partial assignment of wages and having to issue onewarrant to the employee and another to a third partywho is the assignee of the employee. To carry this same reasoning further, suppose the employeeassigns severalportion~s of‘hiswages tom several different Individuals. This would require the Comp-~ trollerWto issue'toeach a separatewarrant for his partlcular portion. Even if the Comptroller could do this under the law and could fssuethe warrants to the insurance company as contemplated inyour plan 'it would require extrawork on the part of some of his employees to keep the books straight.

It ls the opinion of this department that the employees of the Comptrollerare unauthorized to do this work. In effect, such employeeswould be performingprivate services for private Individuals,while being paid by the State.

It is the opinion of this department, therefore, that the Comptroller of PublicAccounts is unauthorized to issue warrants to the insurancecompany as contemplated In the proposed plan of group insurancewhich you submit.. - -

Honorable Julian Montgomery,page 5 o-1968

Yours very truly
ATTORNEY GENERAL OF TEXAS

By s/BillyGoldberg Billy Goldberg Assistant
BG:jm:wc

APPRO-m MAR 8, 1940 s/Gerald C. Mann ATTORNEYGENERAL OF TEXAS Approved Opinion CommitteeBy s/BWB Chairman