STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL

Opinion No. 6811

July 13, 1994

APPROPRIATIONS:

CONSTITUTIONAL LAW:

Legislative appropriations, gubernatorial vetoes, executive branch expenditures and the appropriations committees

Legislative appropriations, gubernatorial vetoes, executive branch expenditures and the appropriations committees

Const1963, art 9, Sec. 17, provides that money may not be paid out of the state treasury except pursuant to appropriations made by law. Sections 301, 351, 402, 501 and 701 of 1993 PA 104 each constitute an appropriation made by law as required by Const1963, art 9, Sec. 17, and, therefore, comply with that constitutional mandate.

Const1963, art 5, Sec. 19, authorizes the Governor to disapprove distinct items appropriating monies in an appropriation bill. Sections 301, 351, 402, 501 and 701 of 1993 PA 104 create distinct items of appropriation subject to the veto authority of the Governor and, therefore, do not violate Const1963, art 5, Sec. 19.

Const1963, art 4, Sec. 22, requires that all legislation must be by bill. 1993 PA 104 was introduced as a bill authorizing expenditures and was duly enacted and, therefore, sections 301, 351, 402, 501 and 701 of 1993 PA 104 do not violate Const1963, art 4, Sec. 22.

Const1963, art 3, Sec. 2, provides that a person exercising powers of one branch of government may not exercise powers of another branch of government. The language of 1993 PA 104, sections 301, 351, 501 and 701, purporting to condition the expenditure of appropriated funds "upon the approval of the house and senate appropriations committees," is unconstitutional because it impermissibly involves the Legislature in executive functions in violation of Const1963, art 3, Sec. 2.

Section 602 of 1993 PA 104 does not violate the Michigan Constitution by attempting to appropriate an undefined amount of money.

Sections 301, 351, 402, 501, 602 and 701 of 1993 PA 104 do not violate the Management and Budget Act by attempting to authorize the expenditure of unappropriated funds.

Honorable H. Lynn Jondahl

State Representative

The Capitol

Lansing, MI

You have asked six questions regarding the legality of certain provisions contained in sections 301, 351, 402, 501, 602 and 701 of 1993 PA 104, a supplemental appropriations act for fiscal year 1993.

Your inquiry is prompted by two specific features found in these statutory sections. First, each of these sections purports to authorize the expenditure of an apparently indefinite amount of money contingent upon receipt of those funds either from the federal government or, in the case of section 602, from county governments. In none of these instances is the authorized expenditure listed as a specific line item in section 101 of the Act. Secondly, with the exception of sections 402 and 602, each of the identified sections purports to require approval of the House and Senate appropriations committees as a pre-condition to the expenditure of these funds.

As you observe in your letter, the following language contained in section 301 of 1993 PA 104 is fairly typical of the pattern employed by these sections:

Your first two questions are closely related and will be addressed together. They may be stated as follows:

Const1963, art 9, Sec. 17, provides:

Const1963, art 5, Sec. 19, provides:

In section 112(1) of the Management and Budget Act (the Act), 1984 PA 431, MCL 18.1101 et seq; MSA 3.516(101) et seq, the Legislature has defined the term appropriation as that term is used in that Act:

There can be no doubt that the language used by the Legislature in sections 301, 351, 402, 501 and 701 of 1993 PA 104, was intended to serve as legislative authorization for the expenditure of funds and constitutes an appropriation within the meaning of this statutory provision.

The fact that, in each instance, the legislative spending authorization is contained only in the language sections of 1993 PA 104, with no corresponding line item in section 101 of that act, does not alter this conclusion. As was observed in OAG, 1985-1986, No 6399, p 402, at 409 (November 13, 1986), a "line item may be a single line or contained in a numbered paragraph of an appropriations bill." To reach a contrary conclusion would enable the Legislature to effectively circumvent the Governor's constitutionally-granted line item veto power by the simple expedient of using "language" rather than a strict single line item approach. Id.

Nor is it significant that the funds in question originate as federal funds rather than as ordinary state revenues. There is a split of authority nationally on the question of the authority of a state legislature to appropriate federal funds; some courts have held that their state legislatures must appropriate such funds prior to their expenditure, while other courts have held that their legislatures have no authority to appropriate federal funds at all. See, e.g., Colorado General Assembly v Lamm, 738 P2d 1156, 1167-1169 (Colo, 1987), and cases cited therein.

In Michigan, however, since the adoption of the 1963 Constitution, all funds received by state agencies must be appropriated by the Legislature before they may be expended. See, OAG, 1977-1978, No 5393, p 693 (November 28, 1978). This result is likewise compelled by various provisions of the Management and Budget Act. Section 441(1) of that Act, for example, mandates that:

Section 384(2) of the Act explicitly addresses federal funds, providing in pertinent part that:

Thus, notwithstanding their federal source, the funds in question constitute "money from a state operating fund" within the meaning of section 112(1), supra.

Finally, it is likewise of no consequence that the appropriations in question are indefinite as to amount. Indefinite or "open-end" appropriations are explicitly recognized and authorized by the Management and Budget Act. Section 303(2) of that Act defines the term "[o]pen-end appropriation" as "an annual appropriation without a specific sum, for a state budget purpose." Section 372(3) of that Act provides for the allotment of those open-end appropriations by the state budget director.

OAG, 1987-1988, No 6544, p 410, 412 (October 27, 1988), upheld the validity of an indefinite appropriation, concluding that, so long as an appropriation sets aside a specific portion of money, with the amount to be ascertained on a date prior to payment, the "appropriation need not be definite in amount at the time of the enactment of the appropriations bill." Sections 301, 351, 402, 501 and 701 of 1993 PA 104 meet these criteria. Each of these sections authorizes expenditure of federal funds only to the extent that such funds are actually "received" by or "available" to the respective state agencies. Thus, the exact amount of the funds appropriated is limited and subject to ascertainment prior to payment. This opinion also concluded, at 412-413, that these indefinite or open-end appropriations are subject to the Governor's line item veto authority under Const1963, art 5, Sec. 19. Thus, the open-end appropriations here in question are also subject to the Governor's item veto under that constitutional provision.

It is my opinion, therefore, in response to your first question, that sections 301, 351, 402, 501 and 701 of 1993 PA 104 do each constitute an "appropriation made by law" as is required by Const1963, art 9, Sec. 17. It is my further opinion,in response to your second question, that sections 301, 351, 402, 501 and 701 of 1993 PA 104 create distinct items of appropriation subject to the veto authority of the Governor and, therefore, do not violate--Const1963, art 5, Sec. 19,

Your third question may be stated as follows:

Const1963, art 4, Sec. 22, provides:

1993 PA 104 was introduced in the House of Representatives as House Bill No 4631, was duly approved by both houses of the Legislature, and was signed into law by the Governor on July 15, 1993. Although the spending authorizations which are your concern did not appear as line items in section 101 of the act, those authorizations, for the reasons described above, do constitute distinct items of appropriation within the meaning of Const1963, art 9, Sec. 17, and art 5, Sec. 19.

It is my opinion, therefore, that 1993 PA 104 was introduced as a bill authorizing expenditures and was duly enacted and, therefore, sections 301, 351, 402, 501 and 701 of 1993 PA 104 do not violate Const1963, art 4, Sec. 22.

Your fourth question may be stated as follows:

Const1963, art 3, Sec. 2, provides:

The power to appropriate funds is assigned by the Constitution to the Legislature. Const1963, art 4, Sec. 31, and art 9, Sec. 17. White v Dep't of Social Services, 20 MichApp 481, 484; 174 NW2d 315 (1969). Legislation which purports to assign that power to the executive branch of government would, accordingly, be unconstitutional and invalid. OAG, 1989-1990, No. 6603, p 229, 242 (October 9, 1989). Sections 301, 351, 402, 501 and 701 of 1993 PA 104 do not, however, attempt to make any assignment of the power to appropriate. As is described above, in each of these sections, the Legislature itself has authorized the executive branch to expend certain specific funds. Accordingly, there is no unconstitutional delegation of legislative authority to the executive branch in violation of Const1963, art 3, Sec. 2.

However, four of the sections identified in your letter, sections 301, 351, 501 and 701, each contain language which purports to condition the expenditure of funds "upon the approval of the house and senate appropriations committees." Several substantially identical provisions were reviewed in OAG No 6603, supra, at 238-245. That opinion concluded that those provisions, all of which purported to require the executive to obtain the approval of the Legislature or of the House and Senate appropriating committees prior to expending appropriated funds, violated the separation of powers doctrine established by Const1963, art 3, Sec. 2:

Id, at 240. See also, OAG, 1975-1976, No 4896, p 132, 149 (September 9, 1975).

It is my opinion, therefore, in response to your fourth question, that the language of 1993 PA 104, sections 301, 351, 501 and 701, purporting to condition the expenditure of appropriated funds "upon the approval of the house and senate appropriations committees," is unconstitutional because it impermissibly involves the Legislature in executive functions in violation of Const1963, art 3, Sec. 2.

Pursuant to MCL 8.5; MSA 2.216, the Legislature has mandated that a statute be construed so that any unconstitutional portion be severed and the remaining portions be given effect unless to do so would be inconsistent with the manifest intention of the Legislature. OAG No 6603, supra, at 236, and cases cited therein. There is nothing in 1993 PA 104 to suggest that the Legislature intended its provisions to be nonseverable. The appropriations and the remaining provisions contained in sections 301, 351, 402, 501 and 701 are independent and are capable of being carried out without reference to the invalid language and, thus, remain valid. Id. See also, OAG 1967-1968, No 4602, p 186, 187 (February 20, 1968), and OAG, 1989-1990, No 6598, p 208, 211 (August 30, 1989).

Your fifth question may be stated as follows:

Section 602 of 1993 PA 104 provides that:

For the reasons described above in response to your first two questions, the Michigan Constitution does not prohibit the Legislature from enacting an "open-end appropriation," as that term is defined in section 303(2) of the Management and Budget Act, supra, provided that the appropriation sets aside a specific portion of money, with the amount to be ascertained prior to actual payment. OAG, No 6544, supra, at 412-413. Section 602 of 1993 PA 104 meets this criterion; by its plain terms, the amount of the appropriation described in that section is increased only "in accordance with any increase in intergovernmental transfer amounts made by affected counties above those included in Act No. 19 of the Public Acts of 1993." The clear intent of this language is that the additional expenditures are authorized only after the increased amounts from the counties are actually transferred and the amount of the increase is thus definitively determined.

It is my opinion, therefore, in response to your fifth question, that section 602 of 1993 PA 104 does not violate the Michigan Constitution by attempting to appropriate an undefined amount of money.

Your sixth and final question may be stated as follows:

For the reasons stated above in response to your prior questions, sections 301, 351, 402, 501, 602 and 701 of 1993 PA 104 all constitute lawful appropriations by the Legislature, entirely consistent with the requirements of Const1963, art 9, Sec. 17, and of art 5, Sec. 19. Accordingly, these sections do not attempt to authorize the expenditure of unappropriated funds.

It is my opinion, therefore, in response to your sixth question, that sections 301, 351, 402, 501, 602 and 701 of 1993 PA 104 do not violate the Management and Budget Act by attempting to authorize the expenditure of unappropriated funds.

Frank J. Kelley

Attorney General