STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL

Opinion No. 6200

January 26, 1984

CONSTITUTIONAL LAW:

Const 1963, art 9, Sec. 30 (Headlee Amendment)--proportion of state spending due local units of government

MUNICIPALITIES:

Proportion of state spending due local units of government under Const 1963, art 9, Sec. 30 payable in following fiscal year

WORDS AND PHRASES:

'Following fiscal year'

1979 PA 57, Sec. 5(2), requires that the proportion of state spending due local units of government under Const 1963, art 9, Sec. 30 shall be payable in the fiscal year following the fiscal year in which the deficiency in payments is ascertained and reported to the Legislature.

Honorable J. Michael Busch

State Representative

The Capitol

Lansing, Michigan

You have requested my opinion on the meaning of the term 'following fiscal year' in 1979 PA 57, Sec. 5(2), MCLA 21.265(2); MSA 3.586(2), in light of Const 1963, art 9, Sec. 30, which provides:

1979 PA 57, MCLA 21.261 et seq; MSA 3.586(1) et seq, Secs. 2 and 5 provide, in pertinent part:

I have been informed by the Michigan Department of Management and Budget that the amount of additional payments to local units of government, which would have been necessary to meet the 1978-1979 fiscal year proportion in the 1983 fiscal year, were not available to the Legislature earlier than July 13, 1983, and generally this information would not be available earlier than May 19, 1983. Thus, from seven and one-half to nine and one-half months may elapse after the end of a fiscal year before information concerning the additional payments which should have been made to local units of government is available to the Legislature.

The term 'following fiscal year' may be read to mean either the fiscal year following the fiscal year in which the deficiency in payments to local units of government occurred, or the fiscal year following the fiscal year in which the deficiency in payments to local units of government was reported. The first interpretation would require an appropriation act to pay the deficiency in payment to local units of government in the fiscal year the report was received. The second interpretation would allow the deficiency to be considered with the proposed budget for the following year.

The Legislature must pass or reject the general appropriations bills for the succeeding fiscal period covering items in the budget before an appropriation bill for items not in the budget may be passed, except for bills supplementing appropriations for the current fiscal year's operation. Thus, the Legislature may not pass an appropriation bill for the deficiencies in payments to local units of government in a prior fiscal year until the general appropriations bills for the succeeding fiscal period are passed. In addition to contravening Const 1963, art 4, Sec. 31, the immediate passage of an appropriations act could require adjustments to the budgets and appropriations from the current fiscal and succeeding fiscal periods submitted by the Governor pursuant to Const 1963, art 5, Sec. 18. These constitutional provisions compel the conclusion the Legislature intended appropriations for deficiencies in payments to local units of government to be included in the budget and appropriation bills for items in the budget for the ensuing fiscal period. Any other interpretation would disrupt the constitutionally mandated budget process.

It is my opinion, therefore, that the term 'following fiscal year' in 1979 PA 57, Sec. 5(2), supra, means the fiscal year following the fiscal year in which the deficiency in payments to local units of government was ascertained and reported to the Legislature.

Frank J. Kelley