opinion so. O-4907 Rer Bnk overdraft in the local fuuds of state Eduoetioua1 Iustitutious. 510 dll aokaouledge reoeipt of your let of 00tobw 5, 1242, requesting

the oplnica of thi6 depwtamt. quote a1 followa:

%I OWUeOtim with annual audito, now being made by this deparSmant, of $10 book8 and rewrils of the various State Educational ~a~t&itxm we hh~ enoo=tered a pra~tiw, m the legality of uhioh np need flour opinion in order to &se proper ocmsent and reooamendation in our Reports.

"'ibis is a Pnotice (uhioh, inoidentally, is not general) of issuing aheaks agaimt boa1 Amd he& l ooounts is whioh there.are not suffioient ba1anwsto payths oheoks. In other wurds these are financial trawaotiona whiah result in rotual hank overdrafts in ~erw&r of the Looal Fwda +hioh are aubjeot:tos&ropriation, and reappropriation, by fhe tigialature - a method of finenoing by the college whioh may be questionable under existing statutes as it appears to have the effeot of supplementing Legislrtivo appropriations as well as perhaps extending tb State'8 oredit. Patunlly the reoipients.of these oheshs hold then, or the bank pays the& in Imtioiption of future collsotions of Fess of other rwenuer~. eto. I;O shall appreoiate your answer to the following queetionsr

'(1) IS it legal for the Finenor Offioers of a State Eduor~+onal ~,,~~~oplft, iwue &e&s against bsnvacoounts in uhioh there we not dfi&ent halames at the time to aover, on Looal .Fund Ao-ts uhioh ars subject to Legislative appropristion?

s(2) If fhs mswr to question PO. l'indioates an illegal practioe, wht is the legal &.stua of any and all suah cheohs7 ~,~~+sie your &wei to thsa.e'questionf probably muid not bs i '. affeoted ,b.the attitude or l otion oi the bsnk on nhioh the ohs&e : bad been drann,‘that is, whether or not they had aotually paid the *2 - -.

krIoraue c. E. cwnew - Pag.e 2. &No7

and ewrying In th eir b o o kn a- werdraft awant. cd l p pm x hatd y $lS,QaMLl 011 August Slst, lQ42, a sitw.tlOn that bas been a0l-e or less OOntinUOUe itl WE &EWtiCiUhr i.nnStWw, With tfm bu& haring b fulThhOd IlO WOUd~ t0 00WC those 0rsldmrts 8' the oollege, If aurasmaptiw that&e attitude acd aots of the hsnkbaveno boaring up t.te enwer to the dove 2uestions iu iaoorreot, we &all he plOased tc hvu you t&e that into ocnaideraticn.s lhe answer to ttm f*D questiwr pmpouuded In your mquert for aa opinn?on 0al.b for an i11t4J~~tiOm Of Artlole 26b4d. %xaa Civil gt&cteU.

?e Iare bssnuuable tc tindan interpretation of this ststste lyanyofthe oau‘*r ofthim Stlk,ihers+om ouranmers ta yourquest form opida am bad& an general legal pr%noiples as applied tc the hot situatl~ 8et out iuyuurletber.

Artldle 26Md was CUiaotd ly tho %egislat?uu in 13SS, ihis cltatute provides that the @maaing boa&a cf the wvoral State edueatlwn?. instttut3w.e contml of tke localinstit.Go~al inoane Lr tbereinmentianedmayluyin ouryhg aut the hmtSon8 af an eduoatioLalinsbltutian,end tc eeleot degoaltory bsuks themfor; that trte end full acoormts stall lz~ *qt, hy said hoards, snd by the an@yees of such inetituti~na Of all ?@my ocl~ectod dud paid out, ttr, persacs to r;fiara yaid, aud the plrposes for?Moh gadd; reports sbsuld te printed b.lennially~ enc., oopies of r;bioh '. that mete 8mtabe funlieAledtatb0~to offio5Jals thcroInnanOd. 7t:sfurtdmr pmv%ded that tb%e law shall he euhscrvienb to :bo Cmnial appmprtati0n Mlls for the support of the as~eral insfi~t~~~s thu~~~~tiuzod.

Sso. 1, (a) of the acts of the legi6laturo in 1941, nvCzlrg appmpriat3cx3 for eduoational instituttons of bigherleaming reads as follows:

-7hat all bslanoes in the instit~ti0nal fund cf thn snrar*l '.tatc s&oatiormrl Iustitutions named in the aot,at ',iti o:ono of t&a fiscal year oudiug August 21, 1942, +naLd.irg %.?.waos ‘in the revolving fund at that time, and the eutire InoOrc to saZd fwds .durlng each 0i.th.s tm fiscal years ending August 21, 1942, and August Sl, 1945, which are not ot!Mrdso appmprslated for oither or both of said years are hereby appmprlated forthe support, malnt-snsncs, operation, end impromtaent of said State Isstitutions during eacb of said years, respectively.'

7.w do not find anytbiug in said statute nor in the said appropriation bill that msi&&s the school authcrities of the educational iustit~tionS In question in hwing ohooks on the looal f?md tank aOcoucts during the fisoil year, nithiu the limit of appmpriatiOn for the par, hut we think t,ht& mid s&o01 auth~ritios wnnot lawfully draw ohecks 011 such fuuds &tig~yfiswl year in exoess of the aQpropriatiommado by the legislatere for that year0

:*omblo c. ii. c3mloss - Pago 3. 0.4907

:ouaoi~opinloa~t~sdrrrmonloorl~d~kaacolefsin oxoaes of ths appropriation, by said sohool autlmritias, durkg any fbsal year, that- outstsndlng andunpaidattbe endof- fisoalyaar, ax-s' mlid asd osmot bo pid out of ths fiture rsvewes of suoh lastitutims.

Yours very truly A'lWRRET GZIRXUL OF ‘GkS s/t. F. Pries

w E. P. Frioo AsSistsnt