Untitled Texas Attorney General Opinion ( 1985 )


Menu:
  •                                   The Attorney              General     of Texas
    Hewh 18. 1985
    JIM MAllOX
    Attorney General
    supm       OolJrt   sulwng       Mr.ClaytonT. G6rrbon                        opinionno. m-300
    ‘. 0. Box 12545                 Eucutive Director
    rurwt. TX 75711.2545            prploycesRetiremew:System                   Re: Whether   the    Employees
    51w75.2501
    of Tuu                                   RetirementSystem is entitled
    Telex 2lw74lS7
    hcoplw 513l47bo2w               P. 0. Box 13207                             to depository intereat   on a
    Auotin* TexaB   787Ll.                      particularfuud under article
    6543d. V.T.C.S.
    Dear l4r.   Gerriwn:
    You request am.opinion from thie office conceroingthe dispoai-
    tion of deporitory.:lnterest  earned by an lccount held.by the atate
    treaeurer.ou .behalf of the Lav Rnforcemeut and Cuetodial Officer
    .SupplemutelRetircmmt Fund. .Thia account, deeignatedFund No. 977
    by the etete treaturer, is estebliehedes a pert of the Employees
    Retirement.Syrtem  cf Texas. a portion of whose esoete is credited to
    the fund. V.T.C.S. Title llOB, Public RetirementSystems, (25.306(7)
    (1985Pamphlet).
    Pou inform ue that while the fund retains the incoW derived from
    w5 Bmwwy. wt. 312
    Lubboak,lx.7wol34To
    iuvestnut made~owtridethe state treasury,it has not been credited
    low7474225                       with the depositoryinterestearned by Pund No. 977. Accordingly,you
    lk vhether the fund-is entitled to mxh interest and, if so, whet
    ~uthod shouldbe wed to calculetepreviouslyeccumulatedInterestnot
    43WN.lOll*r4SUluS
    uanm,Tx.          75wl-lws
    creditedto Fund lo. 977.
    31-7
    ..’
    .::
    & ~&&ory     provisionrelevant'tothe diapoaitior'ofdepository
    futerest.i8lrticlw2543d``V.T.C.S..which provides the follcuing in
    aloualnRu4sLin.400              pertinentpart: i'
    5ulAnlonlo.Tx.~7
    512R25415l
    Intertat~receive~on accouut of the    deposita
    of-moueya iu funds.and lc o u nte in the.charge of
    An 5eudolloAnnrr   ..                        the Stat11Treenurershallbe allocated,eefollavs:
    Afnmm(k Adlql5molqw               _~     'C To ,uch~-.constitotionelfund there .&all be
    credited:the pro tata portion oft the. inter&t
    received due to such ‘fund. The remeinder of the
    :.lnterertireceived; with the. exception of thnt'
    '~      .~ iportion-,wquired.by  other statutea'tobi ~creditkd
    :on a,.prwrata basis to protected tax pajmkntr.
    Au111 br. credited to the General Rweme Pund.
    Tha intweet received shell be allocated on e
    monthly basis.
    .
    p. 1355
    Mr. Cleytou T. Garrison- Ptrge2 (JR-300)
    V.T.C.S. art. 2543d. il. This office   has deteruined ou nuuerous
    occasiousthat in additionw the funds exeuptedabove, assets held in
    the foru of A trust sre alw exempt frou the requirementsof article
    2543d. See Attorney Gene181 Opinious RR-338 (1981); IN-82 (1979);
    E-1040 cl-); n-468  (1969).
    The opinions just cited establish that in order to be charac-
    terized as trust funds, the assets in question should reflect, auong
    other things, (1) that they are aduinisteredby a trusteeor trustees,
    (2) tbat the assets sre neither granted to the state in its sovereign
    capacitynor collectedfor the general operationof state governmeat.
    and (3) that they are to bezspent and invested for specific, limited
    purposes and for the bemfit of A specific group of individuals.
    Being in the ueture of a trust, such assets are eutitledto retain the
    proceeds frou their investment. Attorney General Opinions MW-481
    (1982); U-468 (1969). Cf. Attorney     General Opinion B-1243 (1972)
    (interest earned in join``uuds must be deposited into the general
    revenue fund). The saue theory applies to interest earned ou tiue
    depositsof these assete.   kttorneyGeneralOpiniou If-468(1969). SLe
    Lauson v. BaRer, 220 S.U. 26'S,272 (Tex. Civ. App. - Austin 1920. writ
    ref’d).   Accordingly, thqr are not ,subject to the provisions of
    article 25436. Attorney Gencr~l OpinionsMl-82 (1979);Ii-1040(1977).
    In ours opinion, ths Lav Enforcement and Custodial Officer
    Sappl-tal         Retirement    Puud is A trust fund entitled to retain
    depositoryinterest. The retireuentfund is administeredby the board
    of trustees of the EuployeosRetirementSystem. V.T.C.S. Title 1lOB.
    Public RetirementSyntema, '125.101(1985 Pauphlet). This office has
    previously deteruined that: the assets of the Euployees Retireuent
    system, of uhich the retitement fund is A part, exe trust funds.
    Attorney General Opinion UW-565 (1959). The retireueut fund is not
    collected for. the general.operation of the state; rether, it is
    AVAihblA Ody t0 PAY "supplemsntalretir-t             and death benefits to
    lau enforcementAnd cuetodf,al       officers"and for "edministratiou of the
    fuod.”.P.T.C.S:.TitlellO:B,w.              525.313(b);~'The method and form
    of lnvestmmt of retirement fund assets are limited, see V.T.C.S.
    Title 1lOB. m.            1125.103(c)end '25.302.and the proceeds of any
    such investmentare expresslymade part ~of the retir-t            fund. See
    V.T.C.S.I-.Title llOB, Sara.            125.313(a). These features iiK.
    eufficient.      iu   oar view,   to, remove the .retiremsntfund from the
    coverage,   :-of article 2543d,, The interest eerned on deposits of the
    retirement~fund,therefore,         arot,be credited~to the retirementfund
    itself end not depositedin the general rweuue fund.
    Your ,ucond inquiry~concernethe'propermethod of creditingthe
    retirementfund for interel#tlerned in previousyears. We are unable
    to giv~eAdvice AS to the specificaccountingmethod or tims intervals
    tQ be -usedin cakulating 'pastinterest..The ansuer to this question
    depends on ioformetion  act provided by your request -- a,      the
    terms. duration,sod types Iofdeposits, appliuble rates of IntSrSSt.
    etc.  We c*n 8tate *a e geueral matter. however. that the retirement
    p. 1356
    .
    Mr.   Clayton    T. Gerriroo- Page 3         (JR-300)
    fund hAS exhibitedthe lfoleuentionedtrust  fund ChAYACtAYi6tiCS
    since
    its crention in 1979. St,e Acts 1979. 66th Leg., eh. 269, et 528
    (Meting foroer nrticle``iSf-1. V.T.C.S.,lsteblishingLAW Enforcc-
    mt    And Curtodinl OffICC!:Suppleuentel Retireuent Fuod). Conre-
    quAAtlY* the retiremeot fund la entitled to credit for depository
    ioterestfrom that  date. Before the retireuentfund pay be’credited
    with this interest, however.   esrtain lioitations~  oo the use of
    trenouryfundsmst be coucidered.
    Article VIII, section 6 of the TexAr Constitutioo prohibits
    vithdreunl of funds from the stnte treneury in the Absence of
    legirlativel ppropriatioo. The TeXAs Supreue Court he8 held that
    fundr lrroueouslydeposite~l in the general revenue fund are oeverthe-
    less subjectto this couetltutionelliuitetionend uy oot be removed
    frou the trenruryuithout :lc!gisletive
    actlou. lienionv. Lockhnrt. 
    114 S.W.2d 216
    . 219 (Tex. 1938:l.s
    Accordingly.the legislntureuost make a
    specific Appropriation before AO~ ioterest erroneourlydeposited in
    the generalreveouefund my be returnedto the retirementfund.
    SUIIMARY
    The tnr   tnforcement and Custodial Officer
    SuppleuentalRetlcemeot Fund must be creditedfor
    ioterest earned on deporits of the fund.    Any
    interest previourly deposited in the geoeral
    rwenue  fund uurt receive epecified legirlative
    lpproprintion ba:Eore return to the retireueot
    fund.
    ~+tYJy-&
    MATTOI
    Attorney   hOerA    of Texae
    TonGRan
    F%rrt Assistant       Attorney   General
    DAVID R. RICRARDS
    Executive       ASSiStAnt Attorney   CaoerAl
    RIa( GILPIR
    Chairman,OpioionColnittce
    Preparedby Rick Gilpin
    AsSiAtAntAttorney GeoerAl
    p.   1357
    Mr. Claytoo t. Garrbou   - PASS 4   (Jn-300)
    AFPsmm:
    0PIn101 cmmxntP
    Rick Gilpin, CIuirmm
    JonBible
    CollaCarl
    suun&rriAon
    Tar* m=-=Y
    Jim Moellinger
    Jmntfer  Uggs
    IlAuy suttm
    p. l358         .
    

Document Info

Docket Number: JM-300

Judges: Jim Mattox

Filed Date: 7/2/1985

Precedential Status: Precedential

Modified Date: 2/18/2017