Opinion ID: 2607842
Heading Depth: 2
Heading Rank: 3

Heading: legislative mandate

Text: Ellis next contends that Valdez, by accepting the grant, bound itself to purchase the terminal. [5] Ellis' claim rests upon his assertion that an appropriation of state funds amounts to a legislative mandate that the municipality which is to receive the funds must accomplish the purpose for which the legislature has set the funds aside. Not surprisingly, our research reveals few cases in which a municipality or a state agency has been taken to court for failing to spend monies appropriated to it. [6] The cases in which the issue has arisen have sprung from two distinct situations. First is the situation where the legislature has set aside funds for the discretionary use of an administering authority, without expressing or implying any directive to the administering authority to accomplish the purpose for which the funds were set aside. The rule in such cases is that discretion to spend or not to spend within the parameters set by the legislature, rests with the agency for whose use the funds have been appropriated. West Side Organization Health Services Corp. v. Thompson, 73 Ill. App.3d 179, 29 Ill.Dec. 129, 391 N.E.2d 392, 401 (1979), rev'd on other grounds, 79 Ill.2d 503, 38 Ill.Dec. 784, 404 N.E.2d 208 (1980). Another expression of the rule is: An appropriation of public monies by the legislature is not a mandate to spend, rather it is an authorization given by the legislature to a designated agency to use not to exceed a stated sum for specified purposes. Island County Committee on Assessment Ratios v. Department of Revenue, 81 Wash.2d 193, 500 P.2d 756, 763 (1972). Thus, one state legislature's: appropriation of sufficient funds to allow state employees to receive an eight percent (8%) salary increase ... did not constitute a mandate that state employees receive that or any salary increase nor did the act of appropriating the money vest in the state employees any legal interest or right in a salary increase upon which to predicate a cause of action on their failure to receive one. American Federation of State, County, and Municipal Employees, Council No. 95 v. Olson, 338 N.W.2d 97, 103 (N.D. 1983). The second situation which gives rise to lawsuits over an agency's failure to expend appropriated monies occurs when the legislature both sets aside funds to be used by an administering authority for a particular purpose, and affirmatively directs the authority to accomplish the specified purpose. Illustrative of this situation is Felicetti v. Secretary of Communities and Development, 386 Mass. 868, 438 N.E.2d 343 (1982). [7] In that case, a state agency interpreted the language of a state appropriations act to prohibit the agency's release of funds appropriated for home energy assistance until federal approval of the state energy assistance plan had been obtained. The court interpreted the act otherwise, holding that the legislature had expressed its intent not only that the funds be available for release before federal approval of the state plan, but also that the agency process applications and distribute funds before that time. The court held that the agency's failure to do so violated the legislative intent expressed in the appropriations act. The instant case fits into the first situation outlined above; we find no indication of a legislative mandate directing Valdez to acquire the Valdez air terminal. [8] The appropriation act simply states that $7,000,000 is appropriated for Valdez  runway extension, lighting and terminal. [9] The statutory definition of appropriation  a maximum amount available for expenditure by a state agency for a stated purpose set out in an appropriation act [10]  does not mandate accomplishment of the stated purpose by the receiving authority. We cannot accept Ellis' argument that AS 37.05.315(a) and the agreement entered into between Valdez and the state pursuant to that statute obligated Valdez to purchase the terminal. The statute, which applies to all state appropriations or allocations granting money to a municipality, states: When the Department of Administration receives an agreement executed by the municipality which provides that the municipality (1) will spend the grant for the purposes specified in the appropriation ... the Department of Administration shall pay the grant directly to the municipality. [11] Ellis would read this language to require every municipality executing such an agreement to actually spend the appropriated monies. This interpretation would mean that a municipality wishing to embark on a project involving state funding would become irreversibly committed to the project at the moment it signed the agreement required for it to obtain state funds. No change in conditions or reassessment of the merits of the project would allow the municipality to reconsider its position. According to Ellis' interpretation, even if the municipality and the state agreed that it would be unwise for the municipality to go forward with the project, any interested citizen could force the municipality to spend state funds to do so. We do not accept this reasoning. A more reasonable interpretation of the statute is that an agreement must be executed between the Department of Administration and the municipality in order to insure that both parties understand and agree on the exact purposes for which the allocation may be spent, and to impress upon the municipality that the grant is available for such purposes, and for no others. [12] Valdez was under no statutory duty to purchase the air terminal from Ellis; summary judgment in Valdez' favor on this issue was appropriately granted.