Opinion ID: 1192606
Heading Depth: 1
Heading Rank: 2

Heading: state constitutional debt limitation

Text: The state argues that any promise by the state to create a future debt obligation from currently unappropriated, non-special funds monies, however express and unambiguous, would violate Article XI, sections 7 and 10, of the Oregon Constitution (debt limitation). [19] The state argues: The state could not legally or validly promise employees that the state would continue for future fiscal periods to pick-up employee contributions, or to grant credit for sick leave. To do so would be to contract to pay money in the future from funds not currently appropriated or available for that purpose, which would violate constitutional debt limitations. Contracts and agreements should be construed to be valid when possible. Any doubt, therefore, as to whether express and unambiguous language of promise appears, where the commitment of future general fund dollars [ sic ], should be resolved in favor of finding no such promise to have been made. The Public Employes' Retirement Fund (PERF) is a statutory trust fund, separate and distinct from the General Fund. PERF is fully funded on a pay-as-you-go basis by employer and employee contributions and interest on its investments. Because full payment is made in the present, the pension benefits at issue in these cases do not create a future debt obligation. Moreover, the state acknowledges in its brief that it has recourse under its employment agreements to separate employees before any violation of the debt limitation would occur. Thus, Article XI, sections 7 and 10, are not implicated here.