DAN MORALES

ATTORNEY GENERAL 

## QBffice

oftly BttornepQheral &tate of IICexae April 11,1994 

## Mr. Robert w.oee Chair Public Utility Commission ofTexas 7800 Shoal Creek Boulevard Austin, Texas 78757 Opinion No. DM-288
Re: Authority of the Public Utility Commission of Texas to apply for, receive, and expend federal funds, and related questions (RQ-664)

You have requested advice about the authority ofthe Public Utility Commission of Texas to receive federal 8mds. You write that you are aware of several federal grants that the commission could use to acquire, analyze, and use significant new information. You ik3tS.k: Considering Chapter V, 522, ofthe Appropriations Act

.,andthe

Public Utility Regulatory Act ,maythe [commission] directly or indiiectly apply for, receive, and/or expend federal finds? You refer to federal grants for the purpose of acquiring, analyzing, and using significant new information. Among other projects, you are interested in obtaining a federal grant to purchase a Geographic Information System, which relates data base information to the map. This system would enable the commission to compile and analyze utility information according to geographic regions. We believe article 1446c, V.T.C.S., the Public Utility Regulatory Act, authorizes the commission to seek federal grants to assist in carrying out its statutory duties. The commission has statutory authority to acquire and analyxe utility information, as well as other related kinds of information. See V.T.C.S. art. 1446c, @8(b)(5) (requiring commission to employ director of research experienced in analysis of industry, economics, energy, firel, and other related matters), 16(b) (requiring commission to develop long-term statewide electrical energy forecast), (e) (requiring commission to review and evaluate electric utilities’forecast ofload andresources). The commission has

the general power to regulate and supervise the business of every public utility within its jurisdiction and to do all things, whether specifically designated in this Act or implied herein, necessary and convenient to the exercise ofthis power andjurisdiction. Id, 5 16(a). Moreover, the Public Utility Regulatory Act is to be “construed liberally to promote the effectiveness and efficiency of regulation of public utilities.

.‘I Id. 989.

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We believe that the commission has authority to apply for federal grants when “necessary and convenient to the exercise” of its general power to regulate public utilities. In our opinion, the commission is authorized to seek and receive a federal grant to purchase the Geographical Information Service you described, assuming that the conditions attached to the particular grant are conditions that the commission may accept. Seealso Gov’tCode, $403.012 (comptroller may accept federal money for a state agency not otherwise restricted by statute, rider, or special provision in the general appropriations act). Whether the commission has statutory authority to apply for grants for other purposes must be determined on a case-by-case basis. In general, ifthe commission has statutory authority to receive an appropriation for a particular service or item, we believe it may also seekfederal timding for that service or item.
You are concerned, however, that article V, section 22 of the current general appropriations act bars the appropriation to the commission of federal finds received during the current biennium. Federal grant finds, like other funds received by state agencies, must be deposited in the state treasury. Gov’t Code 5404.094; Attorney General Opinion IM-772 (1987). Once fimds are inthe treasury, they may be withdrawn only by appropriation by the legislature. Tex. Const. art. VIII, 56. The general appropriations act may include items of appropriation, which state the amount and purpose offunds allocated to state agencies, and ridersthat detail, limit, or restrict the use of finds appropriated by the act.’ Tex. Const. art. III, §35; Attorney General Opinion V-1254 (1951); see alsoMoore v.Sheppard, 192S.W.2d 559, 561 (Tex. 1946);Attorney General Opinion DM-I 16 (1992) (general legislation may not be enacted in a general appropriations bill). Article V, section 22 ofthe general appropriations act appropriates federal fimdsreceived during the current biennium to the agencies authorized to use them, subject to stated limitations. SeeAttorney General Opinions IM-772 (1987) at 7-8; H-550 (1975)at 3-4. It states inpart:

All fimds received from the United States government by state agencies and institutions named in this Act are hereby appropriated to such agencies for the purposes for which the federal grant, allocation, aid, payment or reimbursement was made subject to the following:

a. Except for institutions and agencies of higher education, federal funds including unexpended balances shall be deposited to and expended from the specific program identified under each agency’sappropriation billpattern.

IInaddition, articleXVI, s&ion 69 ofthe Texas Constitution now authorizes the legislature to require,by riderin the generalappropriationsact or by separatestatute,the priorapprovalof an expenditore ortheemergencytransferofanyhnd.5appropziatedtoagencies ofstategovernment.

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Except for institutions and agencies ofhigher education, no federal timds may be expended for strategies or Smctions other than those which have been reviewed by the Seventythird Legislature and authorized by specitic language inthis Act or encompassed by an agency’s budget structure as established bythis Act. Acts 1993, 73d Leg., ch. 1051, art. V, 522, at 5351.’ You read the first sentence in paragraph a. of this rider as allowing the commission to use federal timds only if its appropriation specifically identifies a program as timded by federal funds. Since the appropriation to the Public Utility Commission does not identity any program as being timded by federal timds, you are concerned that any federal funds granted to the commission during this biennium would not be appropriated to it. See Acts 1993, 73d Leg., ch. 1051,art. I, at4854-61. The tirst sentence in paragraph a. does not expressly state that federal finds may only be deposited to a program specifically identified as a recipient of federal funds, but states that federal timds are to be deposited to “the specific program identified” under the agency’sappropriation billpattern. Weread “specificprogram” asrefening to the items of appropriation in each agency’sappropriation. The current appropriations act refers to the items of appropriation as “strategies.” Moreover, in this context, the word “identified means “set out” or “listed” in the agency’s appropriation. Thus, federal funds granted to an agency may only be deposited to and spent from one of the specific programs, or strategies, listed in its appropriation. If the commission’s appropriation includes an item that may be spent for a computerized mapping system, federal funding for that purpose maybe deposited to that item. The second sentence inparagraph a. prohibits the expenditure of federal funds for programs other than those reviewed by the 73d legislature and authorized by the specific language of the general appropriations act or by the agency’s budget structure. See generallyAttorney General Opinion JM-772 (1987) (construing second paragraph of virtually identical provision in 1986-1987 appropriations act). Both sentences of paragraph a. have a similar effect: a state agency, except for an agency or institution of higher education, may spend federal fimds for the purpose for which they were granted only ifthe agency’sappropriation authorizes expenditures for that purpose. The appropriation to the Public Utility Commission appropriates funds for various strategies that appear broad enough to encompass an expenditure for the Geographical Information Service. For example, the commission receives fundsto

zArticle V,section

22 ofthecurrentgeneral

appropriations

actalsoincludesotherprovisions that arenotrelevant

toyourquestion.

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Assess the demand and current supply of electricity and determine the need for additional resources. .

Process and analyze filingsto change boundaries

Examine and review all construction reports filed by electric utilities fornew transmission tinesandpower plants. lIHJaintain database oftelecommunications construction information. Acts 1993,73d Leg. ch. 1051,art. I, at 4856, 4857 (strategies B.l.l., B.2.1., and C.l.l.). In our opinion, these specific appropriation items are broad enough to encompass an expenditure for a Geographical Information System, and there may be other items in the commission’s budget that could also be spent for this purpose. Federal grant tirnds received for this purpose during the current biennium may be deposited to and expended from one ofthese accounts or another account that would permit the expenditure of stategenerated fimds for that purpose. See generdy Attorney General Opinion JM-916 (1988).
Your other questions are contingent on a contrary reading of section 22. Accordingly, we need not answerthem.

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SUMMARY The Public Utility Commission has authority under V.T.C.S. article 14461~

to apply for federal grants necessary and convenient to the exercise ofits general power to regulate public utilities. Federal grsnt finds are placed inthe state treasury, ,andchapter V, section 22 of the current general appropriations act appropriates them to the agencies for the purposes for which the federal grant was made, subject to stated conditions. Among other conditions, section 22 provides that federal tirnds granted to an agency, other than an agency or institution of higher education, may only be deposited to and spent from one of the specillc programs listed in the agency’s appropriation. If an item of appropriation in the wnunission’s appropriation could be spent for the purposes for which the federal grant was received, the federal grant funds may be deposited to and spent from that item. j-~you~o_lr

DAN MORALES Attorney General ofTexas JORGE VEGA Fist Assistant Attorney General
DREW DURHAh4 Deputy Assistant Attorney General for CriminalJustice
WILL PRYOR Special Counsel
RENEA HICKS State Solicitor
SARAH J. SHIRLEY Chair, Opinion Committee Prepared by SusanL. Garrison Assistant Attorney General

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