The opinion
OFFICE OF .
THE ATT RNEY GENERAL
AUSTIN~ TEXAS
February 12, 1948
Honorable George H. Sheppard
Comptroller of Public Accounts
Austin, Texas Opinion No. V-501
Re: Construction of
H. B. 674, 50th
Legislature, as
to whether said
act makes an ap-
propriation of
proceeds of sales
and transfer of
property supple-
mentary to the
regular biennial
appropriation.
Dear Sir:
Your request for an opinion is as follows:
"1 quote the following excerpts from
House Bill No. 674, Acts of the Regular
Session of the Fiftieth Legislature:
"'The money from the sale of such
property, less the expense of advertising
the sale, shall be deposited in the State
Treasury to the credit of the department;
commission, board, or other State agency,
which transferred the property to the State
Board of Control. The credit to such de-
partment, commission, board, or other State
agency shall be made to the fund from which
such property could be purchased. . . .
*'Any property which has become unfit
for use, or no longer needed, when placed
under the jurisdiction of the State Board
of Control by any department, commission,
board, or other State agency, including
State Eleemosynary Institutions, colleges,
institutions of higher learning, and the
Hon. George H. Sheppard, Page 2 (V-501)
.
Texas Prison System, may be transferred
by the State Board of Control to any in-
stitution department, commission, board,
or other 6tate agency in need of same, and
the proper debit and credit shall be made
on the basis that such property can be pur-
chased in the market at the time of the
transfer, if a market exists, and if not,
at its actual or intrinsic value as set by
the State Board of Control. The State
Comptroller shall, upon information fur-
nished by the State Board of Control, deb-
it the anoronriation of the State agenT
receiving such transferred property, from
which such property could have been pur-
chased, and credit the fund from which such
property could have been purchased, to the
State agency that transferred such pro erty
to the State Board of Control, . O ..IPUn-
derscoring supplied)
"The question arises under the admin-
istration of this Act as to whether moneys
received from the sale of property belong-
ing to a State agency, etc., whether such
property was purchased by funds from the
current appropriation or a prior appropria-
tion, shall be credited to the current ap-
propriation and supplement the current ap-
propriation,,or whether these moneys are
credited to the appropriated fund and are
not supplemental to the current appropria-
tion for the State agency, etc.
"None of the moneys received from the
sale of such goods were taken into consid-
eration ~when this department certified the
General Appropriation Bill under Section
boa of Article III of the Constitution.
"I shall thank you to advise this de-
partment whether the moneys received from
the sale of such property are supplemental
to the current appropriation, or whether
they are a credit to the appropriated fund
and are not subject to the use or bene~fits
of the department receiving same.
Hon. George H. Sheppard, Page 3 (V-501 1
"If you rule that the moneys received
under this Act are supplemental to the cur-
rent appropriations, then does the bill be-
come non-operative after two years from its
date?
"I am attaching hereto reports of sale
or transfers of State property that have
been received by this department for your
study in answering this question. I shall
thank you to return these reports with your
reply."
You present two questions which we restate as
follows:
(1) Whether the moneys received from the sale
of such property are supplemental to the current appro-
priation, or whether they are a credit to the appropriated
fund and are not subject to the use or bepefits of the de-
partment receiving same.
(2) "If you rule that the moneys received un-
der this Act are supplemental to the current appropria-
tions, then does the bill become non-operative after two
years from its date?"
House Bill No. 674, 50th Legislature, is divided
into two sections, exclusive of the emergency section.
The first section authorizes the Board of Control to sell
personal property belonging to the State, under the con-
trol of any department, commission! board, or other State
agency, except State eleemosynary Institutions, colleges,
institutions of higher learning, and the Texas Prison Sys-
tem, when it shall become unfit for use, or no longer
needed. Section 2 authorizes the State Board of Control
to transfer property no longer needed, or which has be-
come unfit for use, from one State department, commission,
board, or other agency, to another State board, commis-
sion, or agency, and in addition includes eleemosynary
institutions, colleges, institutions of higher learning,
and the Texas Prison System specifically excluded by Sec-
tion 1. Section 2 also provides for trade-in of such
property on new property of the same type.
Both sections prescribe the method of account-
ing to be adopted by the Comptroller in handling a sale
or transfer of property comprehended by the Act. In nei-
ther case, however, is a supplemental appropriation made
Hon. George H. Sheppard, Page 4
to the regular biennial appropriation to the respective
departments, boards, agencies of the state, or institu-
tions coming within the terms of the Act. The Act does
not make an appropriation of any funds arising from a
sale of property under Section 1 or arising from~a trans-
fer as provided in Section 2, and does not operate to in-
crease or diminish the current biennial appropriation.
Therefore, your certificate as to the available and pro-
spective funds to meet the General Appropriation Bill un-
der Sec. 49a of Art. III of the Constitution is not in-
volved. Whether it be a sale or transfer, the Act does
nothing more than prescribe a method of bookkeeping to
be followed by the Comptroller in handling the proceeds
of a sale or handling an exchange of property from one
State department, board, agency or institution to another.
Its operation is not limited to two years, but, for the
reasons hereinafter set out, the bill should be amended
or reworded by the Legislature in the future to make its
full intent completely certain.
In the case of a sale or transfer, it is our
opinion that the Act requires the credit to be made to
the itemized appropriation of the selling or transfer-
ring Department in the current appropriation bill from
which such property could have been purchased. Such
credit then stands in the place of the property which
was given up by the Department receiving the credit.
The question then arises as to whether the
credited Department may use this credited sum for all
purposes covered by the itemized appropriation to which
it is credited or whether such use is limited to the re-
placement of the same type of property. On this ques-
tion there has been considerable disagreement in this
office. The uncertainty and ambiguity of the Act and
the conflict of opinion thereon within this office have
caused the long delay in the completion of this opinion.
The intent of the Legislature and whether it used words
sufficient to carry out such intent has caused us great
concern, After carefully studying the entire Act to-
gether and reviewing the public policy involved and the
evils which the Legislature apparently desired to remedy
by this Act, we have concluded that it was the intention
of the Legislature to allow departments to trade in, ex-
change, or sell surplus or unfit personal property for
the purpose of replacing it with the same type of fit
and usable property.
Hon. George H. Sheppard, Page 5 (V-501)
We do not believe that the Legislature intended
that the credit from trade-ins, exchanges, transfers or
sales could be used for all purposes specified in the
itemized fund or appropriation from which the particular
item of property could have been purchased. If so, some
of the itemizations are so,broad that credits from per-
sonal property could be used to pay seasonal help, sal-
aries, and other expenses which have no relation to the
replacement of the particular type of property involved
in the trade, exchange, or sale. To apply that inter-
pretation to the Act would be giving it the effect of an
appropriation, which cannot be done in view of the other
provisions of the Act.
Therefore, it is our opinion that the credits
for trade-ins, transfers, and sale of personal property
covered by this Act may be used only toward the replace-
ment or purchase of the same or a similar type of per-
sonal property. Any credits over and above the amounts
used on replacement or purchase of the same or a similar
type of property will remain subject to future appropria-
tion or use specified by the Legislature or will revert
to the general fund or other appropriate fund after the
current biennium as provided by other laws on the subject.
SUMMARY
Credits for personal property trans-
ferred or sold by State departments under
House Bill 674, 50th Legislature, should
be made to the itemized appropriation from
which the property could have been purchased.
Such credits may be used only to replace or
purchase the same or a similar type of per-
sonal property,
Yours very truly
MTMlv&DdA ATTORNEY GENERAL OF TEXAS
ATTORNEY GENERAL
LPL:jcp:erc