Court Opinion

ID: 4131146
Source: CourtListenerOpinion
Date Created: 2017-02-18 01:12:29.498268+00
Date Added: 2024-06-11T14:33:22.152465
License: Public Domain

The Attorney           General            of Texas
                                                   HB:V 28.   1985
JIM MAlTOX
AttorneyGeneral

Supreme
      Ccd       Building        hr. Robert C. Laniw                              OpinionNo. m-321
P. 0. Box 1254S                 Chairman
Auslln. TX. 76711~2543          StateDepartmento!lHighways                       Re: Whether interest on coustitu-
51214752501                        and Public Transportation                     tionallydedicated funds may be
Telex 9101874.1367
Telecopier 512I475-0266
                                Dewitt C. Greer Eigbway Bldg.                    diverted to general revenue by
                                11th & Brazes                                    statuteor by appropriationsact
                                Austin,Texas 7awi                                rider
714 Jackson. Suite 7W
Dallas, TX. 752024506           Dear hr. Lanier:
214ll4269)4

                                     You ask two questionsregardingthe appropriationof interestou
4824 Alberta Ave.. Suite 160    funds dedicatedby the conatitutiouto highway purposes. You do not
El Paso, TX. 79935.2793         Inquire about other:aourcea of tavanue for the atate highway fund.
OlY533as4                       You first ask:

1001 Texas. Suite 700
                                             1. C;viintereston dedicatedfundsbe divert.ed
Houston. TX. 77002.3111                   to gener,sl
                                                    revenueby appropriations
                                                                           act rider7
71Y223.5886
                                     Article 2543d. V.T.C.S.. governsthe dispositionof intereston
                                time depositsof etate funds. Section1 of this statute provides as
 806 Broadway. Suite 312
 Lubbock, TX. 79401-3479
                                follow:
 SO6n47.5238
                                             Section 1. Interest received on account of
                                          time deposits of moneys in funds and accounts in
 4309 N. Tenth. Suite B
                                          the charne'of the State Treasurershall be allo-
 HcAllen. TX. 78501-1685
 51216824547
                                          cated al; follows: To each constitutionalfund
                                          there aball be credited the pro rata portion of
                                          the int&eat received due to such fund. The re-
 2130Main Plaza, Suite 400                mainder DE the interestreceived.vith the exceu-
 San Antonio, TX. 782052797               tion of that portion requiredby other statutes to
 51m254181
                                          be credited on a pro rata basis to protested tax
                                          payments,shall be creditedto the GeneralRevenue
  An Equal OpPCWtUnitYl                   Fund. Th,sinterestreceivedshallbe allocatedon
  Afflrmstlva Action EmPlOYer             a aonthlg basis. (Rupbasisadded).

                                 This provision relpliresthat intereston constitutionallydedicated
                                 funds be allocated to the principal,and uot to the general revenue
                                 fund. Attorney Gmeral Opinion h-466 (1969) consideredthe applica-
                                 tion of article2543d, V.T.C.S.. to a numberof funds in charge of the
                                 state treasurer. Three of the funds derivedfrom former articleVII,
                                 section 17 of thf:Texas Constitution,vhich levied a tax to fund
                                 constructionat designatedinstitutionsof higher education. See Ten.
                                 S.J. Res. 4, 50th Leg., 1947 Tex. Gen. Laws 1184; Tex. ST       Res.

                                                                     p.   1469
                                                                             *       _- .
                                                                         .       t

Pk. Robert C. Lanier - Page i! (.I&321)

24. 59th Leg., 1965 Tex. Gel. Laws 2197. Tbe opinion concludedthat
those three funds were constitutionalfunds vithiu the meaning of
article 2543d, V.T.C.S., awl interest received on account of time
depositsthereonvas to be creditedto the fund.

      It is well establishedthat the legielature may not enact, amend,
or reoeal a nenerallaw by rmorooriationact rider. Tex. Const. art.
III, 935; Moore v. Sheppard;,' 192 S.U.2d 559 (Tex. 1946); Linden v.
          49 s.w. 578 (Tex.-'ta99);  Attorney General Opinions J?i-167
E%r
 .~.~ . . m-104  (1979): n-1:.41 (1972): V-1254, V-1253 (1951); G-552
(1939). A ride; which attempted tom-appropriate    to general revenue
interest received on account of time deposits of constitutionally
dedicated funds would be isvalid as an attempt to amend or repeal
article 2543d,V.T.C.S. Iu:ereston constitutionally     dedicatedfunds
may not be divertedto general revenueby appropriationact rider in
contraventionof article2543d,V.T.C.S.

     YOU next ask:

              2. Is it perrlsaible to divert intereat by
           atatute on highway department constitutionally
           dedicatedfunds to generalrevenue?

      Article VIII, section l-a of the Texas Constitutiondedicates
 revenuesreceivedfrom motor vehicle registrationfees and motor fuel
 taxes to the provision,maintenance,and policingof public roadways.
 This constitutionalprovisionstates in part:

              Sec. 7-a.   Sub.ject    to legislativeappropria-

           on county and wad district bonds or varrants
           voted or issued prior to January 2. 1939, and
           declared eligibleprior to January 2, 1945, for
           payment out of the County and Road District
           Righway Fund uniier existing lav; provided, bow-
            ever, that one-f'curth (l/4) of such net revenue
            from the motor f,nrltax shall be allocated to the
            Avaflable School Fund. . . . (Emphasis added).

                                     p. 1470
Hr. Robert C. Lanler - Page 1’ (JIG321)

The term “couatructing”
                      in al:ticle
                                VIII,     section7-a. does not Include

          merely the clearlq;and gradingof the roadbedand
          the pouring of the concrete,but includes ‘every-
          thing appropriate1.y connected with, and ueces-
          sarily incidental!:oithe completeaccomzplishment’
          of the generalpurposefor vhich the fund exists.

State v. City of Austin, 331 S.W.td 737, 746 (Tex. 1960) (cost of
utility relocationnecessitatedby improvementof federally-funded
highways).

     Article VIII, section7. of the Texas Constitutionprohibitsthe
legislature from borrowing, or In any manner diverting from its
purpose, any specialfund. %nstitutional funds can be transferredto
the general revenuefund only by constitutionalamendment. CarrollV.
Williams,202 S.U. 504 (Tex. ‘1918)(countyfunds).

     In Lawson v. Baker, 221)S.W. 260 (Tex. Civ. App. - Austin 1920.
writ ref‘d), the Austin Cclurtof Civil Appeals determlned that
interest earned on a special fund created or recognized by the
conatitutloubecame part of tihatfund. A taxpayerbrought the suit to
test the constitutionality of the State Depository Law enacted in
1919. Acts 1919, 36th Leg.,,ch. 145, at 266. The law provided that
the interest on all funds depositedwould become part of the general
revenue. Id. at 269 (formerarticle 2427 R.C.S.). The court stated
as follows?

          We think it is cle.arthat the interest earned by
          deposit of speci;l:lfunds is an increment that
          accrues to such special fund, and any attempt of
          the Legislatureto make such interest a part of
          the general rwenr;:is futile. in the face of the
          constitutionalpn%isions creating or dedicating
          these funds to sprzialpurposes. The broad langu-
          age of the act would seem to make the interest
          upon all funds,wt.ethergeneralor special,become
          part of the general revenue,and this portion of
          the law, if so construed,would authorizea diver-
          sion of the special funds from their constitu-
          tionalpurpose,wcluldspeciallyviolate section7,
          article8. and would be unconstitutionaland void.
           (Emphasisadded).

 Lawson v. Baker, supra, at 272. The court found that the statute
 could be upheld by a constructionallocatingto constitutionalfunds
 the interest earned thereon or by severing the unconstitutional
 portion.

     According to the opinion in Lawson V. Baker, the legislature
 lacks paver to enact a statutedivertinginterestOD constitutionally

                              p. 1471
Mr. Robert C. Lanier - Page 4    (JR-3211

dedicated funds to general rftvenue.The supreme courts of Missouri
                                the questionyou ask: whetherinterest
and Oregon have each considerc!il
earned on a constitutionally  d.adicatedhighway fund must be credited
to that fund. State Eiuhwa< Cowlsdon v, Sr&nhove~, 504 S.W.Zd 121
(Ho. 1973); State v. Straub. 630 P.2d 229 (Or. 1965) (en bane). Each
court relied on Lavson v. BakM: to hold that the legislaturecould not
                           ---
enact a statute divertinn to the neneral fund the interest    on the
constitutional highway fugd.

    We conclude that the legislaturelacks authority to enact a
statute divertingto the general rwenue fund Intereston the motor
vehicle fees and motor fuel taxes dedicated to highuay purposes by
articleVIII, section7-a of the Texas Constitution.

             Interest on constitutionallydedicated funds
          may not be diverted to general revenue by appro-
          priation act ride>:in contraventionof article
          2543d.V.T.C.S.

             The legislature lacks authority to enact a
          statute diverting ,to the general revenue fund
          intereston the motor vehicle fees and motor fuel
          taxes dedicated to highway purposes by article
          VIII. section7-a c~fthe Texas Constitution.

                                          .IIn   MATTOX
                                          AttorneyGeneralof Texas

 TOM GREEN
 First AssistantAttorneyGen,r:cal

 DAVID R. RICRARDS
 ExecutiveAssistantAttorney(General

 ROBERT GRAY
 SpecialAssistantAttorney   General

 RICK GILPIN
 Chairman,OpinionCommittee

 Preparedby Susan L. Garrison
 AssistantAttorneyGeneral

                                p. 1472
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    .’       .

T                Wt. Robert C. Lanier - Page 5    (J?I-321)
I

                 APPROVED:
                 OPIRIONCOHMITTEE

                 Rick Gilpin,Chairman
                 Jon Bible
                 Colio Carl
                 Susan Garrison
                 Tony Guillory
                 Jim noellinger
                 JenniferRiggs
                 Nancy Sutton
                 Bruce Youngblood

                                                 p. 1473