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The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN FRANK J. KELLEY, ATTORNEY GENERAL Opinion No. 6536 September 12, 1988 APPROPRIATIONS: Lapsed funds in Comprehensive Transportation Fund COMPREHENSIVE TRANSPORTATION FUND: Appropriation of lapsed funds by Legislature TRANSPORTATION, DEPARTMENT OF: Expenditure of lapsed funds in Comprehensive Transportation Fund Unencumbered balances in the Comprehensive Transportation Fund lapse at the end of a fiscal year and may be expended only in accordance with appropriations enacted by the Legislature. Honorable Connie Binsfeld State Senator The Capitol Lansing, Michigan 48909 Honorable Francis Spaniola State Representative The Capitol Lansing, Michigan 48909 You have requested my opinion regarding the proper disposition of unencumbered balances in the Comprehensive Transportation Fund (CTF) administered by the Michigan Department of Transportation (MDOT). The CTF was created by 1951 PA 51, Sec. 10b(1), MCL 247.660b; MSA 9.1097(10c), which provides that the fund "is appropriated to the state transportation department for the purposes described in section 10e, MCL 247.660e; MSA 9.1097(10f)." MCL 247.660e; MSA 9.1097(10f), which appropriates the funds in the CTF, has been amended several times. Your question concerns the form of that provision as it existed prior to and after the enactment of amendatory 1982 PA 438. 1979 PA 58 was the last amendment to Act 51, Sec. 10e, MCL 247.660e; MSA 9.1097(10f), prior to enactment of 1982 PA 438. Subsections (1)(a) through (1)(h) set forth the priorities and purposes for which the CTF moneys were to be expended. Subsection (1)(i) made provision for expenditure of the unencumbered balance in the CTF at the end of each fiscal year: "(i) The unencumbered balance of public transportation distributions remaining in the fund in each year after meeting the purposes described in subdivisions (a), (b), (c), (d), (e), (f), (g), and (h) shall be distributed as grants to eligible authorities and eligible governmental agencies for acquisition of public transportation facilities for consolidation, for capital improvements, and for equipment replacements, for public transportation systems in accordance with the approved public transportation programs of eligible authorities and eligible governmental agencies, or for direct expenditures by the state transportation department for public transportation purposes...." The Legislature enacted 1982 PA 438, in part, to amend Act 51, Sec. 10e, MCL 247.660e; MSA 9.1097(10f), to rewrite the priorities and the purposes for the distribution and expenditure of the CTF moneys, and to make a significant change in the disposition of the unencumbered balance remaining in the CTF after the expenditures authorized in subsections (1)-(4)(e). It also added subsection (4)(f) to deal with the unappropriated and unencumbered balances in the CTF at the end of each fiscal year: "The unappropriated and unencumbered balance of the comprehensive transportation fund lapses each fiscal year and reverts to the fund for appropriation in the following fiscal year." (Emphasis added.) 1982 PA 438 became effective on January 1, 1983. Although Act 51, Sec. 10e, MCL 247.660e; MSA 9.1097(10f), was thereafter amended on three occasions (1984 PA 255, 1986 PA 254, and 1987 PA 234), the quoted subsection (4)(f) remains substantially the same except that its language now appears in the renumbered subsection (4)(e) of the statute. Prior to enactment of amendatory 1982 PA 438, Act 51, Sec. 10e, subsection (1)(i), granted MDOT continuing authority to expend unencumbered balances in the CTF for the purposes expressed in subsection (1)(i). OAG, 1981-1982, No 6036, p 548, 551 (January 29, 1982). In contrast, as amended by 1982 PA 438, Act 51, Sec. 10e(4)(f) provided that the amount representing CTF unencumbered balances remaining after each fiscal year "reverts to the fund for appropriation in the following fiscal year." Your question concerns how this new legislative treatment of unencumbered balances in CTF funds applies to any unencumbered balances existing prior to January 1, 1983. It must first be observed that the continuing appropriation authority set forth in the 1979 PA 58 version of Act 51, Sec. 10e(1)(i), MCL 247.660e; MSA 9.1097(10f), ceased to exist upon the effective date of amendatory 1982 PA 438. When a statute is amended, the language which has been removed and replaced is deemed to have been repealed and from that day forward has no legal effect. Lahti v Fosterling, 357 Mich 578, 587-588; 99 NW2d 490 (1959). Furthermore, amendatory 1982 PA 438 contained no savings clause language which would have permitted MDOT to expend any unencumbered balance at the time 1982 PA 438 became effective. Accordingly, the previously unencumbered CTF funds are to be appropriated and expended pursuant to the 1982 PA 438 version of Act 51, Sec. 10e(4)(f), now Sec. 10e(4)(e). The pre-1982 PA 438 unencumbered balance CTF funds constitute "an unappropriated and unencumbered balance" of the CTF as of the end of the 1983-1984 fiscal year. As amended by 1982 PA 438, Act 51, Sec. 10(e)(4)(f), required those funds to revert to the CTF "for appropriation in the following fiscal year," i.e., the fiscal year ending September 30, 1985. The answer to your question lies in a determination of what the Legislature meant by the words "for appropriation in the following fiscal year." The cardinal rule of statutory construction is to ascertain and give effect to the intent of the Legislature. Grand Rapids v Crocker, 219 Mich 178, 182; 189 NW 221 (1922). If the statutory language is clear, the Legislature is deemed to have intended the plainly expressed meaning and the statute must be enforced as written. Hiltz v Phil's Quality Market, 417 Mich 335, 343; 337 NW2d 237 (1983); Dussia v Monroe County Employees Retirement System, 386 Mich 244, 249; 191 NW2d 307 (1971). The courts have also held that in construing a statute the occasion and necessity for it are of concern and its purpose should be effected if possible. Webster v Rotary Electric Steel Co, 321 Mich 526, 531; 33 NW2d 69 (1948). Prior to the enactment of 1982 PA 438, this office issued OAG, 1981-1982, No 6036, supra, which considered the authority of the Legislature to control, by means of the annual appropriation process, MDOT's expenditure discretion over unencumbered balances in the CTF. The opinion stated: "Both the 1980-81 and 1981-82 appropriation bills, 1980 PA 363 and 1981 PA 32, specifically require that at the end of the respective fiscal year any unencumbered balance in the comprehensive transportation fund, other than that allocated during the two preceding fiscal years: " '[s]hall remain in the comprehensive transportation fund and shall be used pursuant to section 10e(1)(i) of Act No. 51 of the Public Acts of 1951, as amended, for projects contained in an annual state transportation program approved by the legislature pursuant to section 10h(4) of Act No. 51 of the Public Acts of 1951, as amended, only upon reappropriation by the legislature,' (Emphasis provided.) 1980 PA 363, Sec. 53(2) and 1981 PA 32, Sec. 21(2). ".... "A comparison of 1951 PA 51, Sec. 10e(1)(i), supra, with the language 'only upon reappropriation by the legislature' included in 1980 PA 363, Sec. 53(2), supra, and 1981 PA 32, Sec. 21(2), supra, indicates that the Legislature is attempting by the appropriation process to limit the authority of the Department of Transportation to distribute the unencumbered balance of public transportation distributions remaining in the comprehensive transportation fund, even though the distribution is authorized by 1951 PA 51, Sec. 10e(1)(i), supra, without any requirement that the funds be reappropriated. ".... "To require the new restriction of having the unencumbered balance reappropriated would have the effect of altering and amending 1951 PA 51, Sec. 10e(1)(i), supra, without reenacting and publishing that section, in violation of Const 1963, art 4, Sec. 25. ".... "It is my opinion, therefore, that the clause 'only upon reappropriation by the legislature' included in 1980 PA 363, Sec. 53(2), supra, and 1981 PA 32, Sec. 21(2), supra is constitutionally invalid because it is an attempt to alter and amend 1951 PA 51, Sec. 10e(1)(i), supra, without reenacting and publishing that section at length." OAG, 1981-1982, No 6036, supra, at pp 550-551. Two additional principles of statutory construction are relevant in this context. First, an amendment is generally construed as changing the meaning of a statute. Reinelt v Public School Employees' Retirement Bd, 87 Mich App 769, 773; 276 NW2d 858, lv den 407 Mich 855 (1979); Borkus v Michigan National Bank, 117 Mich App 662, 668; 324 NW2d 123 (1982), lv den 417 Mich 998 (1983). Second, a statutory amendment should be construed in light of legal interpretations, whether by the court or the Attorney General, which may have prompted the amendment. Brown v Shell Oil Co, 128 Mich App 111, 114-116; 339 NW2d 709 (1983), lv den 424 Mich 867 (1986), cert den ____ US ____; 107 SCt 97; 93 LEd2d 48 (1986). 1982 PA 438 is a legislative effort to accomplish, by direct amendment of Act 51, Sec. 10e(1)(i), what the Legislature had failed to accomplish in the two appropriations acts analyzed in OAG, 1981-1982, No 6036, supra. The Legislature appears to have intended to provide for the annual appropriation of unencumbered balances of CTF funds at the end of each fiscal year. This is borne out by a study of the legislative history of amendatory 1982 PA 438. 1982 PA 438 was introduced in the House as HB 4938. The bill did not retain the language of Act 51, Sec. 10e(1)(i), nor did it provide for the lapse and reversion of unappropriated and unencumbered balances to the CTF for appropriations in the following year. The House passed House Substitute (H-4) to HB 4938 which purported to rewrite Sec. 10e to insert subsection (5)(F) to require the balance of funds remaining in the CTF to be expended by MDOT in accordance with the state transportation program approved under Sec. 10H. 1982 House Journal 2653, 2654, 3418. The Senate passed a Substitute (S-3) to HB 4938 which contained subsection (4)(f) to provide for the lapse each year of unappropriated and unencumbered balances and reversion to the CTF for appropriation in the following year. 1982 Senate Journal 2965, 2973. The House concurred in the Senate Substitute. 1982 House Journal 2950. A study of the House Legislative Analysis, HB 4938, January 4, 1983, is also instructive. See Luttrell v Dep't of Corrections, 421 Mich 93, 103; 365 NW2d 74 (1985). In discussing the purposes of the bill, it states: "The bill would specify a new order of priority for comprehensive transportation fund appropriations, after payment of principal and interest on bonds and departmental expenses. For the 1983-84 fiscal year, 75 percent of the balance would go to transportation program operating grants, less the amount by which money received by authorities and agencies from the federal government under the Urban Mass Transportation Act exceeds $22 million. For the next fiscal year, 65 percent of the balance would go toward grants, less the amount by which federal aid to authorities and agencies exceeds $11 million. Five percent would go to new small bus service and specialized service in both fiscal years. Small bus service would be defined as the operation of a vehicle with a seating capacity of 29 or fewer operating for less than three years. Specialized services would be those provided to handicappers or senior citizens. Intercity passenger and freight programs would each receive eight percent in the 1983-84 fiscal year, but freight programs would be reduced to five percent in 1984-85. A special transportation development account would get four percent in 1983-84, and 17 percent thereafter. The account could be expended only under specific line-item appropriations. Unappropriated and unencumbered balances in the comprehensive transportation fund would lapse back to the fund for appropriation the next fiscal year." (Emphasis added.) In light of this history, Act 51, Sec. 10e(4)(e), may not be read to mean that the Legislature intended unencumbered balances in the CTF at the end of the fiscal year to lapse back into the fund for expenditure in the ensuing fiscal year in accordance with the continuing appropriation process set forth in Act 51, Sec. 10e(1)-(4)(d). Had the Legislature intended such a result, it would omitted any reference for appropriation in the following fiscal year. It is my opinion, therefore, that unencumbered balances in the Comprehensive Transportation Fund lapse at the end of a fiscal year and may be expended only in accordance with appropriations enacted by the Legislature. Frank J. Kelley Attorney General
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