Untitled Texas Attorney General Opinion, O-6837

Untitled Texas Attorney General Opinion

O-6837

| Tex. Att'y Gen. | Jul 2, 1945

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*1 OFFICE OF THE ATTORNEY GENERAL OF TEXAS AUSTIN GROVER SELLERS ATTORNEY GENERAL

Honorable C. H. Cavness tate Auditor Austin, Texas

Dear Sir: "The 45th Legislature (N. R. 258 R. . 45th Leg., Chap. 125, p. 229) in 1937 created the Fireman's Relief Tension Fund, and provided for revenue for that fund to come from an occupation tax on fire insurance companies - 2 per cent on gross premiums. "This provision was attacked in the lower courts and carried to the Court of Civil Appeals, which court ruled that this tax violated the 'due process and equal protection provisions of the tate and Federal Constitutions - (126 S. W. 2d 741). "The 47th Legislature (N. R. 1011 R. . 47th Leg. Chap. 636, p. 1404) appropriated $£ 300, 000.00$ annually, out of any funds, not otherwise appropriated as funds for the bientium ending August 31st, 1943 'for the purpose of providing permanent

funda and reventus for the Firmen's Rolief and Retirement Fund'. "The 49th Logislature ineluded the following appropriation for the Firmen's Pension Comissionor in the Departmental Appropriation Bill for the blenaium ending August 31st, 1947: "FIRBMEN'S PERGION COMIGGIONER (Out of Firmen's Relief and Retirement Funds.)

Salaries

Conmissioner (S)

For the Tears Ending August 31 August 31 1946 1947 3,600.00 $3, 600.00$

Mointessence

Office expense, postage, stationery, office fix- . tures and supplies $1, 500.00 1, 500.00$
Treveling expenses, contingent expenses, and other necessary help and expenses to be incurred in administration of Firmen's Rolief and Retirement

Grand Potal, Firmen's Pension Comissioner $ 262,850.00 262,850.00 "We shall appreciate your advising us on the following questions: "Do the state Comptroller and state Treasurer have the authority to pay the items appropriated to the Firmen's Pension Commissioner by the 49th Logislature for the blennium ending August 31,1947? "In a manner similar to that followed by the 49th Logislature, the 48th Logislature had appropriated $$ 230, 600.00$ for each year of the blennium ending August

*3 Jl, 1945. The State Comptroller and state Treasurer made disbursenents from this appropriation in the same manner as they had under appropriation by the 47 th Logislature.*

Your Incuiry raises two very important questions. The first is, whether or not the apprepriation of money to be paid to firemen, who are not employees of the State, amounts to a grant of money to an individual which is prohibited by Article III, Sections 44 and 51 of the Texas Constitution. The second is, whether or not an appropriation to the "Fire:an's Pension Commissioner (out of Firemen's Relief and Retirement Funds)" may be paid out of the General Revenue Fund. To will discuss the questions in order.

After aneotment of the Firemen's Pension and Feli of Law in 1937 (Article 62430, V. 1. C. C.), a number of Insurence companies attacked in court Section 2 of the 80 t which provided for a two per centum (2\%) tax on the gross premiums of fire insurance companies. This tax, which was for the purpose of providing permanent funds and revenues for the Firemen's Feli of and Retirement Fund, was held unconstitutional in American Alliance Insurance Company vs. Hoard of Insurance Commissions (1939), 126 E. W. (2d) 741, error refused. Thereafter, in 1939, there was introduced in the 47 th Iegislature H. B. No. 46 which was proposed as an amendment to Section 2 of Article 62430. This bill, which also provided for a two per centum (2\%) tax on the premiums of fire insurance companies, was submitted to this Department by the Spuker of the House of Representatives for an opizion on its constitutionality. In our Opinion No. 0-3468, issued May 19, 1941, we passed on the constitutionality of Article 62430, as well as H. B. No. 46. In that opinion, we said:

*Article III, Section 51, denies to the legislature the power to make or authorize 'any grant of public money to any individual, association of individuals, municipal or other corporation whatsoever. ... Article III, Section 44, provides that no grant of money shall be made to any individual except the same shall have been provided for by preexisting law. While, admittedly, the State might provide a system of pensions and disability benefits for its employees without thereby violating the constitutional provisions (Byrd v. City of Dallas, 118 Tex. 28), it is urged that firemen are not employees of the State, but of the municipalities, and that, therefore, the law takes a grant of public money in violation of the above Articles of the Constitution.

*4 Non. C. H. Cavness, page 4

For the purposes of this opinion it may be conceded that firemen are not state employees and that the act does not make them such. We do not attempt the decision of that question. Neverthe- less, it appears to us that the validity of the law as against such objections to its constitu- tionality is sustained by the decision of our state Supreme Court in the case of Friedman v. American Sursty Company of New York, at 21, handed down on April 9, 1941."

The Friedman case is reported in 137 Tex. 149, 151 C.W. (2d) 570. See also Lower Colorado River Authority vs. Chemical Bank & Trust Co., 185 S. W. (2d) 467. We are still of the opinion that the above holding is correct.

H. B. No. 46, however, was not enacted by the 47th Legis- lature. That Legislature enacted instead H. B. No. 1011 which made an annual appropriation of $300,000 for the blemnism ending August 31, 1943, for the purpose of providing permanent funds and revenue for the "Firemen's Relief and Retirement Fund". In our Opinion No. 0-3833, addressed to Honorable George H. Sheppard, Comptroller of Public Accounts, this department held that said appropriation was valid.

For the blemnism beginning September 1, 1943, and end- ing August 31, 1945, the 48th Legislature appropriated $230,600 per annum for the Firemen's Pension Commissioner by making pro- vision therefor in the Departmental Appropriation Bill. General and Special Laws, 48th Legislature, Regular Session (1943), page 928. The 49th Legislature, like the preceding one, included in its Departmental Appropriation Bill an annual appropriation for the "Firemen's Pension Commissioner (out of Firemen's Relief and Pension Funds)". It increased the appropriation to $262,850.00 annually but used the almost identical language as had been used by the preceding Legislature. At the time both appropriation bills were passed, the Firemen's Relief and Pension Fund con- tained only the unexpended balance of money previously appro- priated. Its continued existence as a Special Fund was depend- ent in each instance on the validity of the current appropriation contained in the Departmental Bill. No question was raised as to appropriations made by the 48th Legislature and these funds have been expended. You now inquire whether the current appropriation should be paid.

*5 To are definitely of the opinion that Article 62430, V. A. C. S., is sufficient as a pre-existing law within the meaning of feotion 44, Article III of the Texas Constitution. This is implicit in our Opinion No. 0-3833, which upholds the validity of the annual appropriation of $$ 300, 000$ which was made for this same purpose by the 47 th Legislature in H. B. No. 1011. Article 62430 provides for a comprehensive state plan for a Firemen's Pension System. The only part of the act which has been invalidated is that part of section 2 which levies a two per centum (2\%) tax on the gross premiums of fire insurance companies. Section 10 of Article 62430 provides for contribution by participants in such Firemen's Relief and Retirement Fund of not less than 18 nor more than $3 %$ of his salary, to be determined by a vote of the Fire Department of which such person is a member, and to be deducted from his salary or compensation if he is a wholly paid or part paid fireman whose salary or compensation is more than fifty dollars per month and if he is a part paid fireman whose salary is less than fifty dollars per month or a volunteer fireman he shall pay not less than $$ 3.00$ nor more than $$ 5.00$ per annum, the exact amount to be determined by a vote of the fire department of which such person is a member. Also, the 49th Legislature amended section 6 of the act to provide that "eligible and qualified firemen who shall have completed 20 years of service before reaching the age of fifty-five" shall be entitled to retirement benefits under the act when reaching the age of fifty-five, even though he shall not have been engaged in active service as a firemen at said time. section 6, Article 62430, V. A. C. S. The act itself recognizes the obligation of the State to raise funds for Firemen's Pensions and to provide for their administration. This is its primary objective. The particular means by which the funds are to be raised, whether by a special tax or by appropriation out of the general revenue fund, is a secondary consideration. Even if the Firemen's Pension and Retirement Fund is raised by a special tax, the moneye accruing to the fund would have to be appropriated every two years. See our Opinion No. 0-700. The appropriation in either case would be in connection with and based upon Article 62430 as the "pre-existing law."

Article 62430 is not itself an appropriation act. Pickle vs. Piming, 91 Tex. 484, 44 S. E. 480. Section 19 of the act creates the office of Firemen's Pension Commissioner and fixes his salary at $$ 3, 600.00$ a year "to be paid by voucher of the State Treasurer from said Firemen's Relief and Retirement Fund". Section 6 of Article III of our Constitution, however, provides that no appropriation of money shall be made for a longer term than two years.

*6 Horn. C. :Cavness, page 6

To hold that 3eotion 19 is an "appropriation" for the ourrent blemelum would be tantamount to deolaring it unconstitutional, beosuse it was onseted more than two years ago. "It is a wellsottled rule in the construction of statutes that if an est of the legislature be capable of two constructions, one of which conlllats with the oonstitution, and the other of which does not, the letter must prevail." Pielde ve. Finley above.

The ultimate question, therefore, involves the construction of that portion of the current appropriation bill quoted in your letter. Section 1 of the current Departmental Appropriation Bill is as follows: "That the several sums of money herein specified or so much thereof as may be necessary, are hereby appropriated out of any moneys in the State Treasury not otherwise appropriated, or out of special funds as may be shown, for the support and maintenance of the several departments and egencies of the state Government for the two year period begianing September 1, 1945, and ending August 31, 1947."

The ordinary rules of statutory construction are applicable to appropriation bills. In Pielde ve. Finley, 44 ㅇ. 480, the Supreme Court, in conatruing an appropriation bill, said: "It is also true that no specific words are necessary in order to make an appropriation; and it may be oonceded, as contended, that an appropriation may be made by implication when the language employed leads to the belief that such was the intent of the Legis1ature."

The legislative history of the Firemen's Pension and Relief Law, including the amendment of 3eotion 6 thereof by the 49th Legislature, throws light on the question of legislative intention as evidenceed by the appropriation bill. The 49th Legislature was presumed to know that 3eotion 2 of the Act had been deolared unconstitutional and that there was no longer any special taxes to provide permanent funds and revenues for the Firemen's Relief and Retirement Fund. The 48th Legislature was presumed to have known this when it made an appropriation in its Departmental Appropriation Bill for this purpose and since the funds thus appropriated were paid without question, the 49th Legislature had no reason to make any change in the method of appropriating funds for the Firemen's Relief and Retirement

*7 Fum. C. F. Cavness, page 7

Fund. The language "out of Firemen's Relief and Retirement Funds" as used in the current appropriation bill must be construed to mean that the funds are appropriated out of the General Revenue Fund to the Firemen's Relief and Retirement Fund and paid out of said special fund by voucher of the State Treasurer as directed in said appropriation bill and in Article 62438. To hold otherwise would be to eredit the Legislature with doing a vain and foolish thing, for it is presumed to have known that there were no money in the Firemen's Relief and Retirement Fund, except such as had been previously appropriated for the blemnium ending August 31, 1945. The construction should be adopted which gives effect to the law, rather than a construction which nullifies the law or leads to absurdity. 39 Tex. Jur. 222.

We accordingly advise you that in our opinion the appropriation to Firemen's Pension Commissioner contained in the current appropriation bill for the blemnium ending August 31, 1947, is valid and should be paid by the State Comptroller and State Treasurer.

Yours very truly,

ATTORNEY GENVRAL OF TEXAS

By Japan Dishon

Fagen Dishon

Assistant

FDirt

APPROVED

AUTORNEY GENVRAL

Fager

1945