Untitled Texas Attorney General Opinion ( 1989 )

THE ATTORNEY GENERAL
OF TEXAS
June 26, 1989
Ms. C. Kingsbery Ottmers Opinion No. JM-1063
public Counsel
public Utility Counsel Re: Whether a state agency
8140 Mopac may pay the temporary fees
Westpark III, Suite 120 assessed against accountants
Austin, Texas 78759 and engineers in its employ
(RQ-1619)
Dear Ms. Ottmers:
You refer to Attorney General Letter Opinion 88-79,
which concluded that a state agency is not prohibited by the
Texas Constitution from paying the attorney tax imposed by
Tax Code section 191.142 for any attorney in its employ on
the date on which the tax becomes due.
You ask whether a state agency is likewise constitu-
tionally permitted to pay the temporary increase in fees
imposed on accountants by V.T.C.S. article 41a-1, section
31. You also ask that our response cover all professional
employees affected by the temporary fee increases imposed by
House Bill 61. H.B. 61, Acts 1987, 70th Leg., 2d C.S., ch.
5, at 9. Section 31 of article 41a-1, added by House Bill
61, provided for the temporary fee increases for accoun-
tants. That bill also imposed similar fee increases on
physicians, dentists, optometrists, chiropractors, PsY-
chologists, architects, engineers, real estate brokers,
securities dealers, and veterinarians, as well as the
temporary tax on attorneys addressed in Attorney General
Letter Opinion 88-79. We will address the constitutionality
of a state agency paying such fee increases for any such
professionals within its employ.1
1. Attorney General Letter Opinion 88-135 noted that
the "fee" increases imposed by House Bill 61 on engineers
had the legal character of occupation taxes, their purpose
being, per the bill's caption, "raising revenue to support
(Footnote Continued)
p. 5537
Ms. C. Kingsbery Ottmers - Page 2 (JM-1063)
Attorney General Opinion MW-251 (1980) concluded that
the State Purchasing and General Services Commission might
spend appropriated funds to pay the notary license fees of
employees if the executive director determined that the
agency needed such notarial services and would receive an
adequate return for such expenditures. The opinion
discussed the language of article III, section 51, of the
Texas Constitution, providing that the "Legislature shall
have no power to make any grant or authorize the making of
any grant of public moneys to any individual," and concluded
that it would not bar such expenditures so long as they were
"directly and substantially related to the performance of
the state's governmental function." Id., citing Barrinston
v. Cokinos, 338 S.W.2d 133, 140 (Tex. 1960); Brazoria Countv
v. Perry 537 S.W.2d 89 (Tex. Civ. App. - Houston [lst
Dist.] 1676, no writ); see also Attorney General Opinions
H-133 (1973); WW-638 (1959): WW-433 (1958).
Two briefs submitted in response to your request point
to the distinction made in Attorney General Opinion JM-313
(1985) and Attorney General Letter Opinion 88-79 between
"minimum qualifications for public employmentlU and
"additional training and/or specialization for additional
duties." Those opinions indicated that payments by the
state for obtaining or maintaining such "minimum
qualifications'@ of individual employees would be barred by
article III, section 51, of the constitution.
The briefs distinguish payment of the tax on attorneys
from payment of the other temporary professional fee
increases imposed by House Bill 61, suggesting that if the
latter fee is requisite to obtaining or maintaining the
professional licenses in question, the state might be barred
from paying it as payment for the obtaining or -maintaining
of "minimum qualifications."
(Footnote Continued)
state and local government." The other '*fee" increases
imposed by that bill on members of other professions would
thus appear to be, in fact, occupation taxes as well, the
proceeds from each of those fee increases being subject to
identical provisions as to their apportionment between the
foundation school fund and the general revenue fund. See
Conlen Grain and Mercantile, Inc. v. Texas Grain Sorchum
Producers Bd., 519 S.W.2d 620 (Tex. 1975).
p. 5538
Ms. C. Kingsbery Ottmers - Page 3 (JM-1063)
Attorney General Opinion JM-313 (1985) first made the
distinction between "minimum qualifications" and "additional
training and/or specialization" in considering whether the
bar dues of a prosecutor's office personnel could be paid
from the "hot check fund" established under article 53.08 of
the Code of Criminal Procedure. That opinion concluded that
the payment of bar dues was an *'expense related to the
individual's profession rather than an 'office expense'"
within the meaning of the article 53.08(e) provision that
the "hot check fund" could be used only for 'defraying the
salaries and expenses of the prosecutor's office.*' While we
decline to review here the appropriateness of these
distinctions in reaching the conclusion in Attorney General
Opinion JM-313 that attorney bar dues were not authorized
expenditures under article 53.08, we now disapprove any
implication in that opinion that such distinctions are to be
applied in determining the propriety of an expenditure for
purposes of the constitutional restrictions set out in
article III, section 51, of the state constitution. We
think that the proper test under article III, section 51,
absent more restrictive statutory provisions governing
specific expenditures, is that set out in Attorney General
Opinion MW-251, i.e., whether the expenditure is "directly
and substantially related to the agency's governmental
function," and whether the agency receives adequate return
for its expenditures.
Likewise, to the extent that Attorney General Letter
Opinion 88-79 relied on the fact that the payment of the Tax
Code section 191.142 attorney tax was not an expenditure for
obtaining or maintaining "minimum qualifications" of public
employment (payment of the tax not being requisite to
maintaining the license) in concluding that a state agency
might constitutionally pay the tax for its attorney
employees, we now disapprove that opinion's rationale, while
adhering to its result. We think that payment of an
employee's temporary attorney tax by a state agency is not
prohibited by article III, section 51, of the Texas
Constitution if the agency reasonably determines that such
expenditure is directly and substantially related to the
agency's governmental function. The agency's decision is
subject to review for abuse of discretion. See, e.a
Count
1 chool 192 S.W.2d 89;;
898 (Tex. Civ. App. - Eastland 1946, writ rLf#d n.r.e.).
Therefore, in answer to your question whether a state
agency may constitutionally pay the temporary increase in
fees imposed by House Bill 61 for accountants and other
affected professionals in its employ, we conclude that if
p. 5539
Ms. C. Kingsbery Ottmers - Page 4 (JM-1063)
the responsible agency authority determines that the agency
will receive adequate return on such expenditures, that is,
that such expenditures would be directly and substantially
related to the agency's governmental function, the fees may
be paid by the agency.
Since your question is whether such payments are con-
stitutionallv permissible, we do not address here any
statutory restrictions which might apply to an agency's
payment of such fees, such as the appropriation items from
which such fees might be payable. We do caution that by
concluding that any agency may constitutionally pay such
fees, we do not mean that an agency is reouired to pay them,
even if it determines that it would receive an adequate
return on such expenditures. We would also note that while
certain factors, such as whether the employee in question is
employed full-time or part-time, whether he also uses his
professional credentials in working outside the confines of
state employment, or whether the professional credentials in
question are required or merely useful in performing his
duties, would certainly carry weight in determining whether
the agency receives an adequate quid pro quo for paying the
fees, none of these factors standing alone would be
determinative of the constitutional propriety of paying the
fees. So long as the agency reasonably determines that it
will receive an adequate return for the payments under the
test discussed above, the determination of whether to pay
fees of particular classes of professional employees would
be a policy decision rather than a constitutionally mandated
one, subject of course to any statutory restrictions on such
payments.
You also ask whether a state agency would be "constitu-
tionally correct" when it pays the temporary attorney tax
under Tax Code section 191.142 for attorney employees but
refuses to pay the temporary fee increases for other
professional employees upon whom House Bill 61 imposed fee
increases. We think that, absent distinctions based on
race, gender, or other classifications which would trigger
heightened constitutional scrutiny of its actions, an agency
may, consistent with state and federal equal protection
principles, opt to pay the temporary fee or tax for some
kinds of professionals in its employ and not for others, so
long as there is a "rational basis" for its actions.
See. e.cr., Massachusetts Bd. of Retirement v. Mursia, 427
U.S. 307 (1976). Since your question goes to the practices
of state agencies generally, we will not speculate as to
which factors to be considered in a particular agency's
operations might furnish such a "rational basis" for paying
p. 5540
Ms. C. Kingsbery Ottmers - Page 5 (``-1063)
the professional fees of some groups of professional
employees but not others.
SUMMARY
A state agency is not prohibited by
article III, section 51, of the Texas
Constitution from paying, for professionals
in its employ, the temporary fee increases
imposed on certain professionals if the
agency determines that such expenditures
would be directly and substantially related
to its governmental function. An agency may
pay the fees of some such classes of
professionals in its employ, but not others,
if there is a rational basis for its actions.
Jg:$g+
Attorney General of Texas
MARY KELLER
First Assistant Attorney General
IOU MCCREARY
Executive Assistant Attorney General
JUDGE ZOLLIE STEAKLEY
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by William Walker
Assistant Attorney General
p. 5541