Judges: WRITTEN BY: Don Stenberg, Attorney General Dale A. Comer, Assistant Attorney General
Filed Date: 1/22/1998
Status: Precedential
Modified Date: 7/5/2016
REQUESTED BY: David Heineman Nebraska State Treasurer You have requested our opinion with respect to two questions involving recent legislation pertaining to the use of credit cards by the State and several additional questions involving your authority to conduct banking business on behalf of the State as Nebraska State Treasurer. A number of those questions also involve issues pertaining to the University of Nebraska and the government of the University under the Nebraska Constitution. Our responses to your various questions are set out below. We will divide those responses as they pertain to questions regarding credit cards and questions regarding your authority as State Treasurer with respect to the banking relationships of the State. In each case, we will set out your entire question and then offer our response.
Use of Credit Cards by State Agencies and the University
During the 1997 legislative session, the Nebraska Legislature passed LB 70, 1997 Neb. Laws LB 70 (codified as is pertinent at Neb. Rev. Stat. §§
Any state official or state agency may accept credit cards, charge cards, or debit cards as a method of cash payment of any tax, levy, excise, duty, custom, toll, interest, penalty, fine, license, fee, or assessment of whatever kind or nature, whether general or special, as provided by section
77-1702 .1
In addition, Section
The types of credit cards, charge cards, or debit cards accepted and the services provided for any state official or state agency shall be determined by the State Treasurer and the Director of Administrative Services with the advice of the committee convened pursuant to subsection (5) of section
13-609 .2 The State Treasurer and the director shall contract with one or more credit card, charge card, or debit card companies or third-party merchant banks for services on behalf of the state and those counties, cities, and political subdivisions that choose to participate in the state contract for such services.
Your initial questions focus on the University of Nebraska as a state agency under LB 70, and to what extent, if at all, the requirements of that bill dealing with acceptance of credit cards by state agencies pertain to it.
Question No. 1. "Is the University of Nebraska a "state official or state agency" as described in LB 70 and as such required to comply with this statute?"
LB 70 does not contain any definition for the terms "state official" or "state agency." Moreover, we have reviewed the legislative history of that bill, and those materials offer little guidance as to the meaning of those terms. However, several Nebraska cases do offer some insight on the question of whether the University of Nebraska is a "state agency."
First of all, in Board of Regents of the University ofNebraska v. County of Lancaster,
While the Board of Regents is an "independent body charged with the power and responsibility to manage and operate the University," it is, nevertheless, an administrative or executive agency of the state.
Id. at 786,
Apart from construction of the statutory language found in LB 70, your first question regarding the requirements placed upon the University with respect to compliance with that legislation also raises issues under the Nebraska Constitution. Those issues arise as a result of Board of Regents of the University ofNebraska v. Exon,
The Exon case involved a declaratory judgment action by the University Board of Regents to determine the constitutionality of certain statutes under Art.
The general government of the University of Nebraska shall, under direction of the Legislature, be vested in a board of not less than six nor more than eight regents to be designated the Board of Regents of the University of Nebraska, who shall be elected from and by districts . . .
At issue in the Exon case was a general appropriation bill which contained numerous statements directing the Board of Regents or employees of the University to take certain actions. In addition, the Court considered whether a number of other statutes which pertained generally to state agencies and governed such matters as acceptance of gifts, raises to be given employees, and participation in such state functions as central data processing, planning and design for new facilities and centralized state purchasing could constitutionally be applied to the University under Art. VII, § 10.
In Exon, the court ultimately concluded that:
. . . although the Legislature may add to or subtract from the powers and duties of the Regents, the general government of the University must remain vested in the Board of Regents and powers or duties that should remain in the Regents cannot be delegated to other officers or agencies.
Id. at 149,
In the present instance, it could be argued, under Exon, that the choice of credit cards to be used by the University together with the nature of the contracts for credit card services for the University are matters involving the general government of that institution which cannot be delegated under LB 70 to other officers such as the State Treasurer. However, while the issue is certainly not without some doubt, we believe that the better argument is to the contrary, for the reasons discussed below.
First of all, while Exon provides that the "general government" of the University must remain vested in the Board of Regents, it does not state that all statutes which pertain to state government have no application to the University. As we noted in 1979-1980 Rep. Att'y Gen. 166, 167 (Opinion No. 117, dated May 16, 1979):
Despite what Board of Regents v. Exon says, the Board of Regents is probably not totally insulated from the impact of general laws passed by the Legislature. When the Legislature attempts to specifically direct or control actions of the Board, the legislation is suspect. But we do not believe the court intended to say that the Board could ignore laws of general application. [The Board of Regents] . . . is not, after all, a separate, independent sovereignty.
As a result, it seems to us that statutes which pertain generally to state agencies and which do not purport to direct the Board of Regents as to matters which are central to the University's educational function or its "government," can have application to the University, even under Exon. To some extent, examples of such statutes include those described in University PoliceOfficers Union, International Brotherhood of Police Officers,Local 567 v. University of Nebraska,
We also believe that the decision in the Exon case does not invalidate the requirements of LB 70 for another reason. In theUniversity Police Officers case, supra, the Court pointed out that Art.
This office has indicated in previous opinions that constitutional officers such as the State Treasurer have certain core functions and inherent constitutional authority which cannot be removed by legislative enactment. Op. Att'y Gen. No. 93012 (March 4, 1993); 1969-70 Rep. Att'y Gen. 164 (Opinion No. 110, dated May 5, 1970). Our research discloses that, since the inception of statehood in Nebraska, the State Treasurer has had the duty to receive and keep all money of the State not expressly required to be received and kept by some other officer. Neb. Rev. Stat. §
Since Art.
Question 2. "LB 70 also amends
23-1601 , Section 2 and refers to county treasurer, county official, or political subdivision official. Regarding this part of LB 70, is the University of Nebraska a political subdivision and therefore has an option whether to participate or not in the state's credit card contract?"
Section 2 of LB 70 (codified at Neb. Rev. Stat. §
In Catania v. University of Nebraska, supra, the Nebraska Supreme Court considered whether a negligence action against the University of Nebraska should be brought under the State's Political Subdivisions Tort Claims Act or the State Tort Claims Act. Ultimately, the Court concluded that the University is a state agency which must be sued under the State Tort Claims Act rather than a political subdivision of the State. The Court came to that conclusion, in part, because some of the indicia of a political subdivision such as geographical area and boundaries and the power to tax do not apply to the University. The Court stated:
The University is statewide in its service, has no geographical limitations in the boundary sense of the word and has no power to levy taxes. It is completely dependent, initially at least, on the appropriations made by the Legislature, as are all state agencies.
Id. at 308, 309,
Treasurer's Authority to Establish Banking Relationships for the State
The second group of questions included in your opinion request letter go to your authority as State Treasurer to establish the banking relationships for the State of Nebraska. You cited a number of provisions to us in Chapter 77 Article 23 of the Nebraska Statutes, the Article pertaining to the "Deposit and Investment of Public Funds." Your various questions are in that area.
Questions No. 3. "In reviewing the above statutes and related statutes, does any state official or state agency, other than the State Treasurer, have the authority to establish a banking relationship on behalf of the State?"
Two of the Nebraska statutes which you cited to us in regard to this question are Neb. Rev. Stat. §
The State Treasurer shall deposit, and at all times keep on deposit for safekeeping, in the state or national banks, or some of them doing business in this state and of approved standing and responsibility, the amount of money in his hands belonging to the several current funds in the state treasury.
Section
It is made the duty of the State Treasurer to use all reasonable and proper means to secure to the state the best terms for the depositing of the money belonging to the state, consistent with the safekeeping and prompt payment of the funds of the state when demanded.
We are unaware, generally, of any other statutes which specifically give other state officials or state agencies the authority to deposit the state's funds in a bank. As a result, to the extent that "establishing a banking relationship" in your question is synonymous with depositing funds in the state treasury in a bank, we believe that your office is the only agency with such authority.4
Question No. 4. "Regarding the receipt and disbursement of University funds, including non state (sic) tax sources, are all University funds to be receipted through the State Treasurer's Office?"
Several Nebraska Statutes have a bearing on your fourth question. Neb. Rev. Stat. §
The State Treasurer shall be the custodian of all the funds of the university. Disbursements from the funds named in sections85-124 to85-127 [the Temporary University Fund, the University Cash Fund, the United States Morrill Fund, and the United States Experiment Station Fund] shall be made in accordance with the provisions of law relating to the disbursement of university funds in the hands of the State Treasurer as provided by law.
Neb. Rev. Stat. §
The State Treasurer shall be the treasurer of the state university and the custodian of all funds donated to the university or to the Agricultural Research Division by the United States, including the Morrill, Hatch, and Adams funds, all other donations, gifts, and bequests, income from land and productive funds, fees paid by students, and all funds for the use of the university derived from any source, except (1) funds created by taxation and paid into the state treasury as taxes, and (2) the University Trust Fund which shall be held and managed in the manner provided by section85-123.01 .
Finally, under Neb. Rev. Stat. §
When those various statutes are read in their entirety and together, as they must be, it appears to us that the State Treasurer is the custodian of all funds of the University and of all funds donated to the University except those funds created by taxation and those funds in the University Trust Fund. We believe that authority to act as custodian necessarily implies that the funds in question will be receipted into the State Treasury. Consequently, for those funds for which you are the custodian, we believe that they should be receipted into the State Treasury even if they involve non-tax sources. On the other hand, you are apparently not the custodian of the University Trust Fund under §
Question No. 5. "Are all University funds to be disbursed by the State Treasurer and Director of Administrative Services at the direction of the Board of Regents?"
Again, there are Nebraska Statutes which specifically deal with this question. Neb. Rev. Stat. §
The university funds, other than those created by taxation, shall be held subject to the order of the Board of Regents and shall be disbursed for the purposes prescribed by law, upon presentation of warrants to the Director of Administrative Services, to be issued on certificates of the Board of Regents executed as required by law, . . .
In addition, Neb. Rev. Stat. §
Disbursements from the university funds shall be made by the State Treasurer upon warrants drawn by the Director of Administrative Services, who shall issue warrants upon certificates issued by the Board of Regents, signed by the secretary and president.
On the basis of those statutes, it appears to us that all University funds are to be disbursed by the State Treasurer and Director of Administrative Services at the direction of the Board of Regents with the exception of the university funds in the University Trust Fund. To the extent that those funds are not held by the State Treasurer as provided under §
Question 6. "Does the University have statutory authority to establish a banking relationship to deposit the university funds described in [Neb. Rev. Stat. §]85-125 [1996] and to disburse such funds independently instead of using normal state disbursement procedures?"
Your final question involves the University Cash Fund established by Neb. Rev. Stat. §
The University Cash Fund shall consist of the matriculation and diploma fees, registration fees, laboratory fees, tuition fees, summer session or school fees, all other money or fees collected from students by the authority of the Board of Regents for university purposes, and receipts from all university activities collected by the board in connection with the operation of the university. . . . All money accruing to the University Cash Fund shall become available when appropriated by the legislature for the use of the university and its activities and shall at all times be subject to the orders of the Board of Regents accordingly. No warrant shall be issued against such fund unless there is money in the hands of the State Treasurer sufficient to pay the same. The board shall cause all money belonging to this fund, which is received by its authority at the university, to be paid over from time to time, as the same is received, to the State Treasurer . . .
It appears to us that, under the express provisions of §
We understand that it might be possible to argue, based upon the Exon case, supra, that application of §
Sincerely yours,
DON STENBERG Attorney GeneralDale A. Comer Assistant Attorney General
APPROVED BY:
Don Stenberg Attorney General
Board of Regents of Univ. of Neb. v. Exon , 199 Neb. 146 ( 1977 )
Board of Regents v. County of Lancaster , 154 Neb. 398 ( 1951 )
Catania v. University of Nebraska , 204 Neb. 304 ( 1979 )
University Police Officers Union v. University of Nebraska , 203 Neb. 4 ( 1979 )
Blitzkie v. State , 228 Neb. 409 ( 1988 )