Untitled Texas Attorney General Opinion ( 1959 )

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Hon. Dorsey B. Hardeman, Chairman
State Affairs Committee
Senate of the State of Texas
Austin; Texas
Opinion NO. ww 640
Re: Constitutionality of H.B.
5, 56th Leg., relating
to certification from
the Comptroller required
by Art. III, Set; &a of
Dear Senator Hardeman: the Constitution.
In your letter of May 27, 1959, you advised that
the Senate State Affairs Committee, 56th Legislature,
First Called Session, has referred House Bill 5 to this
office for an opinion on its constitutionality.
Section 1 of House Bill 5 provides as .follows:
“In preparing the financial state-
ments and certifications required by ,~:
Article III, Section 49a of the State
Constitution, the Comptroller of Public
Accounts shall report and consider an
estimate of the probable receipts and dis-
bursements as of August 3lst for the then
current fiscal year.
"The words 'probable receipts' shall
mean knd include all such moneys estimated
by the Comptroller to be received by the
State through August 31st of the then
current fiscal year; and his financial
statements shall show~the fund or funds
to which such receipts are to be credited.
"The words 'probable disbursements'
shall mean, and the Comptroller shall con-
sider and report under such term, only
those payments estimated to be made and
warrants which will be issued by the State
through August 31st of the then current
fiscal year.
.,
Hon. Dorsey B. Hardeman, page 2 (~-640)
"In addition thereto, for the informa-
tion of the Governor and the Legislature
the Comptroller shall list other outstand-
ing appropriations which may exist after
the end of the then current fiscal year,
but they shall not be deducted from the
cash condition of the Treasury or the
anticipatedexthe biennium
for the purpose of certification. In esti-
mating and certifying cash funds to be
available for the next biennium, these
outstanding but undlsbursed appropriations
of each biennium shall be offset by the
estimated total of outstanding but undis-
bursed appropriations of the succeeding
biennium.
"It is the Legislative intent that the
Comptroller's reports, estimates, and certi-
fications of available funds In each instance
shall be based upon the actual or estimated
cash condition of the State Treasury and that
outstanding and undisbursed appropriations
at the end of each biennium shall be considered
as probable disbursements of the succeeding
biennium in the same manner that earned but
uncollected income of a'current biennium is
considered in probable receipts of the succeed-
ing biennium. The provisions of this Act shall
be immediately effective and the Comptroller
shall revise his current report and estimates
in accordance therewith." (Emphasis added)
Section @a, Article III of the Texas ConStltutiOn,
provides in part as follows:
"It shall be the duty of the Comptroller
of Public Accounts In advance of each Regular
Session of the Legislature to prepare and
submit to the Governor and to the Legislature
upon its convening a statement under oath
showing fully the financial condition of the
State Treasury at the close of the last fiscal
period and -.~--
an estimate of the probable receipts
and disbursements for the then--current fiscal
----There
SYJ??E- shall also be contained in said
statement an itemized estimates of ~the anticipated
FeEuxsed
-. ~.--~ on the lawsenineffect that
will be received by-and for the State from
aEou%-es showing
__``_~I_ -.-. the fund accounts to be
-.-..
credited during the succeeding biennium and
Hon. Dorsey B. Hardeman, page 3 (``-640)
said statement shall contain such other
information as may be required by law,
Supplemental statements shall be sub-
mitted at any Special Session of the
Legislature and at such other times as
may be necessary to show probable
changes.
"From and after January 1, 1945, save
in the case of emergency and imperative
public necessity and with a four-fifths
vote of the total membership of each House,
no appropriation in excess of the cash and
anticipatedvenue of the funds from which
such aoorouriation is to be ma= shall be
valid.‘*From and after January 1, 1945, no
bill containing an appropriati~onshall beg
considered as passed or be sent to then
Governor for consideration until and unless
the Comptroller of Public Accounts endorses ~
his certificate thereonshowing that the
amount appropriated is within the amount
estimated to be available in the affected
funds. When the Comptroller finds an appro-
priation bill exceeds the estimated revenue
he shall endorse such finding thereon and
return to the House in which same originated.
Such information shall be immediately made
known to both the House of Representatives
and the Senate and the necessary steps shall
be taken to bring such appropriation to
within the revenue either by providing ad-
ditional revenue or reducing the appropriation.
"For the purpose of financing the out-
standing'obligations of the General Revenue
Fund of the State and placing its current
accounts on a cash basis the Legislature of
the State of Texas is hereby authorized to
provide for the issuance, sale, and retire-
ment of serial bonds, equal in principal
to the total outstanding, valid and approved
obligations owing by said fund on September
1, 1943, provided such bonds shall not draw
interest in excess of two (2) per cent per
annum and shall mature within twenty (20)
years from.date. Added Nov. 3, 1942.'
(Emphasis added)
Hon. Dorsey B. Hardeman, page 4 (``-640)
From the foregoing it is seen that Section @a of
Article III requires of the Comptroller two different
types of duties. First, he is required to prepare for
the Governor and the Legislature a financial report of
the condition of the State Treasury and to prepare an
"estimate" which is to show the Information specified
in the Constitution, and other such matters as the
Legislature may require. Insofar as House Bill 5 is a
specification of the form and content of those reports,
it does not violate the Constitution. Certainly the
Legislature may require any information that it desires,
and it may require that information to be shown in any
manner that it desires, regardless of whether the
Comptroller believes such is necessary to an accurate
accounting procedure.
Second, the Comptroller is to certify that the
amount appropriated in any bill~is within the amount
estimated to be available in the affected funds.
The Comptroller's determination of the avail-
ability of funds appropriated is not required by the
Constitution to be based on his financial report of
the State Treasury prepared for the Governor and the
Legislature or his "estimate'. The word "estimated"
as used in connection with the certification to be
made by the Comptroller necessarily refers to a find-
ing or opinion of the Comptroller separate and apart
from the "estimate" ulhichis referred to in the first
paragraph of~Section @a. That Yestimate" -- the docu-
ment prepared and published by the Comptroller at the
beginning of each legislative session -- relates to
the contemplated revenues to be received by the State
during the succeeding biennium under the statutes in
existence at the time the Legislature meets. The
Comptroller could not determine the availability of
subsequently appropriated funds based upon that "esti-
mate" alone, because it would not necessarily take all
anticipated disbursements into account, and would not
be based upon revenue and other bills passed at the
same legislative session before a bill containing an
appropriation was sent to him for certification. In
this connection, we point out that statutes may be
passed which affect the availability of funds to be
appropriated, but which are not revenue bills and
which do not contain an appropriation. (See Attorney
General's Opinions WW-102 (1957), and ``-632 (1959),
copies of which are attached). The "estimate" pre-
pared for the Governor and the Legislature might not
. ‘.
..
Hon. Dorsey B. Hardeman, page 5 (``-640)
have taken such bills into account. Patently the
question of availability demands a consideration by
the Comptroller of facts which are not or may not
be reflected in the pre-legislative session "estimate".
I
Of course, the Comptroller of Public Accounts,
in making his "estimate" as to the amount of money that
will be available in the affected funds, in certifying
an appropriation bill or returning it to the,House in
which same originated, should by virtue of the mandate
of Section @a of Article III of the Constitution, take
into consideration every element that bears upon the
amount of funds that will be available, Including an
estimate of the amount of funds that will not be ex-
pended under the appropriations for the present
biennium, as well as an estimate of the amount of funds
that will not be disbursed by virtue of appropriations
made for the next biennium.
The Constitution does not expressly,provide whether
the general accounting method should be on a cash or
accrual basis, but there is some language in Section
@a of Article III, Texas Constitution, which would
seem to require the accounting to be on a cash basis.
It is our opinion that the Legislature may direct the
Comptroller to employ a cash accounting basis as sup-
plemental to and inaid of the constitutional provisions
and we do not pass upon whether the Legislature could
require the use of an accrual accounting basis. In
Hamilton v. Deland, 198 N.W. 843, the rule was stated
as follows:
"While legislation may not be necessary to
effectuate the constitutional provision and
none may be validly enacted that Is In con-
flict with it, it does not follow that legis-
lation supplemental to and In aid of the con-
stitutional provision may not be enacted.
This, I think, is settled by the text-writers
and adjudicated cases."
In support of this rule the Court quoted from Corpus Juris;
Ruling Case Law and the 7th Edition of Cooley's Constitu-
tional Limitations.
..
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Hon. Dorsey B. Rardeman, page 6 (W-640)
H. B. No. 5 In effect Instructs the Comptroller
to use the cash accounting basis, as it provides that
outstanding appropriations which may exist after the
end of the then fiscal year should not be deducted
from the cash condition of the Treasury or the antlci-
pated revenue of the next biennium for the purpose of
certification. This we believe to be constitutional.
However, the bill now provides that the outstanding
but undisbursed appropriations of each biennium shall
be offset by the estimated total of outstanding but
undisbursed appropriations of the succeeding biennium.
This we believe to be unconstitutional.
Reading Section &a of Article III from its four
corners, it is our opinion that this constitutlonal
provision contemplates that the Comptroller, in making
his estimate for certification of bills, use the cash
accounting method. The use of the underscored language
in the Constitutional Amendment, as quoted above,
strengthens our opinion that the amendment in question
contemplates that the accounting'.methodto be.employed
by the Comptroller In making his estimates should be on
the cash basis.
In H; B. No. 5 It appears that the Legislature Is
estimating that the outstanding but undisbursed appro-
priations at the end of each biennium will be in the
same amounts as it states that one will offset the other.
However, Section &a of Article III of the Constitution
provides that the Comptroller will make the estimates.
Insofar as this bill attempts to make estimates it is
unconstitutional as a legislative invasion of the duties
of the Comptroller. However, if a severability clause
is added, the remainder of the bill will stand, as it
does not conflict with Section &a of Article III of
the Constitution but is supplemental to and In aid of
the Constitutional provisions.
Other than the questions treated above, we find
no constitutional questions raised by House Bill 5.
SUMMARY
House Bill No. 5 is a constitutional bill
except Insofar as it attempts to make es-
timates as to outstanding but undisbursed
appropriations. For that reason as present-
Hon. Dorsey 5. Hardeman, page 7 (IN-W-640)
ly drafted it is unconstitutional. If
a severability clause be added, the re-
mainder will be effective, as the bill
is complete and workable after eliminat-
ing the unconstitutional provision.
Very truly yours
WILL WILSON
Attorney General of Texas
APPROVED:
OPINION COMMITTEE:
George P. Blackburn, Chairman
Martin DeStefano
Joe Osborn
Mrs. Marietta Payne
REVIEWED FOR THE ATTORNEY GENERAL
By: W. V. Geppert