STATE OF SOUTH DAKOTA
OFFICE OF
THE ATTORNEY GENERAL

December 31, 1975

Mr. William Grams
State Senator
848 LaZelle
Sturgis, SD 57758

OFFICIAL OPINION NO. 75-200

Scope of authority of the Interim Appropriations Committee to release general contingency funds pursuant to SDCL 4-8A

Dear Senator Grams:

You have requested an official opinion based on the following fact situation:

The Interim Appropriations Committee (also known as the special committee in chapter 4-8A) as created in SDCL 4-8A-2 is responsible for the release of general contingency funds that are appropriated by the General Appropriations Act. The procedure for the release of general contingency funds is established in chapter 4-8A.

During the last several months, the special committee has acted favorably on requests for general contingency funds on several different occasions. At its August 11 and 12 meeting, the special committee released funds for the operation of the South Dakota Alcohol Safety Action Project (ASAP) under the Department of Public Safety and the Washington Representative Program, which until July 1, 1975, had been under the Department of Economic and Tourism Development. Both of these programs were acted on by the Joint Committee on Appropriations during session and failed to be placed into the General Appropriations Act by the committee. Subsequently, the Legislature passed the General Appropriations Act without a general fund appropriation for these two programs.

The question presented is:

Does the Legislative Interim Appropriations Committee, as established and governed by SDCL 4-8A, have authority to release general contingency funds for programs that failed to receive support by the Legislature during the regular legislative session?

It is my opinion that the Interim Appropriations Committee's release of general contingency funds in order to revive a program which was defeated by the Legislature during the regular legislative session constituted an unauthorized encroachment upon legislative powers, and that in voting to fund the ASAP program and the Washington Representative Program, the committee greatly exceeded the bounds of limited, delegated authority granted it under SDCL 4-8A.

The Interim Appropriations Committee is a creature of statute, created by SL 1974, Ch. 44. It has only those powers delegated to it by its parent body, the Legislature. It has no inherent power to appropriate! The powers and duties of the Interim Appropriations Committee are delimited in SDCL 4-8A-3:

The special committee shall serve to release sums of money from any general contingency fund appropriated for contingent purposes by the general appropriations act or any special act. ... (Emphasis added.)

Contingent purposes, or contingencies, are defined as events which come "without design, foresight or expectation." BLACK'S LAW DICTIONARY, (4th Ed.) 391. Thus, only when unforeseen conditions necessitate immediate financial aid is the Interim Appropriations Committee authorized to release money from the legislatively-appropriated contingency fund.

SDCL 4-8A-l(3) offers further proof that the sole intent of the Legislature in establishing the Interim Appropriations Committee was to more effectively deal with unexpected, emergency situations:

"General contingency funds" are appropriated funds for expenditures arising from or subject to unforeseen conditions of a department's or institution's operations for which a general fund appropriation has not been provided and which are deemed by the Governor and the special committee to be in the interest of the state and its agencies or institutions.

The early South Dakota statutes accepted the need for some interim appropriations concept, but stricter guidelines were followed:

Provided, that in case of extreme emergency caused by some accident or other cause wholly unavoidable or unforeseen ... (an officer, board or commissioner supported by state appropriations) may incur the necessary expense upon approval in writing by the Governor. SL 1923, Ch. 245, South Dakota Code of 1939, § 55.2201.

Despite a loosening of restrictions, and a change in interim funding procedures over the years, the legislative intent remains clear. Interim funding should be used only for contingent purposes. It is never to be a substitute for legislative appropriation. Under no circumstances should it ever defeat the will of the majority of the duly-elected legislators by unilaterally rewriting the General Appropriations Act to suit its fancy.

Case authority supports the conclusion that the Interim Appropriations Committee's failure to meet the "contingent purposes" criterion when voting to fund the ASAP and Washington Representatives programs was a fatal flaw:

It has been held that debts may not lawfully be created or expenditures made under allocations from an emergency or contingency fund where the Legislature had opportunity to act (Indeaux v. Frohmiller, 47 Ariz. 347, 56 P. 2d 628), or failed to approve the purpose of the allocation, or the facts fail to show the purpose of the allocation to be a contingency or emergency within the statute. (Wells v. Childers, 196 Okl. 353, 165 P. 2d 371.) 81 C.J.S. States, § 156, p. 1194.

The failure or refusal of the Legislature to make an appropriation does not itself create an emergency. (Dir. of Bureau of Legislative Research v. Mackrell, 212 Ark. 40, 204 S.W. 2d 893; Wells v. Childers, supra.) 81 C.J.S. States, § 156, p. 1194.

Because the requests for ASAP and Washington Representative funding were neither unforeseen nor unexpected, and because the Legislature's Joint Committee on Appropriations specifically rejected the funding request, it is my opinion that the Interim Appropriations Committee overstepped the bounds of its authority in releasing funds appropriated "for contingent purposes only" for a non-contingent purpose.

Although the above analysis is determinative of the question you ask, I feel compelled to also consider constitutional issues presented in the question you raise. Article XII, section two of our constitution provides:

The general appropriation bill shall embrace nothing but appropriations for ordinary expenses for the executive, legislative and judicial departments of the state, the current expenses of state institutions, interest on the public debt, and for common schools. All other appropriations shall be made by separate bills, each embracing but one object, and shall require a two-thirds vote of all the members of each branch of the Legislature.

The above-cited constitutional provision clearly says that the general appropriations bill shall embrace nothing but appropriations for ordinary expenses of the three branches of state government, the current expenses of state institutions, interest on the public debt and for common schools. Where there is authority in the above provision to provide for a general contingency fund for "unforeseen conditions" in the General Appropriations Act quite frankly escapes me.

In the case of State ex rel. Oster v. Jorgenson, 81 S.D. 447,136 N.W. 2d 870 (1965), our Supreme Court discussed at some length the requisites of article XII, section two, of our constitution. In considering what constitutes "ordinary expenses" the Court said that although no inflexible rule can be written which can forever draw a line of clear demarcation, extraordinary, emergent and exceptional expenses for any purpose fall within the category of "all other appropriations" which require a two-thirds vote. Ordinary expenses the Court held to mean:

Any related expense (of the executive, legislative or judicial departments) which recurs with regularity and certainty. (Emphasis added.)

By definition, the general contingency fund is for "unforeseen conditions" (SDCL 4-8A-l(3)). In my view, a "contingency fund" for unforeseen conditions in the General Appropriations Act which is supposedly for normal, regular, recurring and certain expenses, is a contradiction in terms which article XII, section two of our constitution would seem to prohibit.

Article XII, section two also clearly requires a two-thirds vote of the Legislature for all appropriations other than the General Appropriations Act. I am not convinced that the present general contingency fund approach is not in effect a device which improperly avoids the above-cited constitutional requirement of a two-thirds vote for certain appropriations. I am aware that a great majority of states have general contingency funds and that it is a necessity to have funding flexibility in meeting new and unforeseen situations. My concern, however, is that under the present constitutional provisions in article XII, section two, the requisites for special as opposed to the general appropriation bill, are possibly not being met. I do not intend this position to be construed in any way as a substitute for a court opinion on the matter, but I do have serious doubts about the constitutional propriety of the present system.

An additional constitutional problem presented in the question you raise concerns the propriety of the delegation of legislative powers to the Interim Appropriations Committee in SDCL 4-8A. Our Supreme Court has not had this specific issue before it, but the Court has repeatedly held that the Legislature cannot delegate its essential legislative powers to any body or department, Boe v. Foss, 76 S.D. 295, 77 N.W. 2d I (1956); Livestock State Bank v. State Banking Commission, 80 S.D. 491, 127 N.W. 2d 139 (1964); and Schryver v. Schirmer, 84 S.D. 352, 171 N.W. 2d 634 (1969), and that the full legislative power, including the power to raise public revenues and to appropriate the same is vested in the Legislature, Carter v. Thorson, 5 S.D. 474, 59 N.W. 469; State ex rel. Longstaff v. Anderson, 33 S.D. 574, 146 N.W. 703 (1914).

SDCL 4-8A-10 and 11 refer to the powers of the special Interim Appropriations Committee to "pass on" and "release" general contingency funds by a majority vote of the entire committee membership. In the case of Parker v. Youngquist, 69 S.D. 423, II N.W. 2d 84 (1943), our Supreme Court said that the test of whether or not an act was an "appropriation" was whether or not the act provided the authority for funds to be drawn from the State Treasury. If the act did provide such authority, it was an "appropriation."

In the facts you present, there is little doubt that under SDCL 4-8A, the general contingency funds cannot be drawn from the State Treasury until the interim committee "approves" such withdrawal. Pursuant to the definition of "appropriation" in the Parker case, I have some reservations about SDCL 4-8A and whether or not the Legislature has there unlawfully delegated the essential legislative function of "appropriating" public funds. Seemingly, since the general contingency funds cannot be drawn from the general fund until the special committee approves, the special committee approval is precariously close to the substance of an "appropriation" as discussed in the Parker case.

The delegation of legislative power is a critical constitutional issue. If it is permissible for the Legislature to set up a general contingency fund to be used as per SDCL 4-8A, it appears to me that nothing would legally impair the Legislature from coming to Pierre and putting all available funds into a contingency fund to be administered and approved by the special committee. I have serious reservations about this sort of delegation since our Supreme Court has repeatedly held that the Legislature cannot delegate away its essential legislative functions. Clearly the power to "appropriate" is such an essential function.

The above views, legal authorities and arguments are my opinion on what I believe the law presently requires in South Dakota. I am aware of the proposed constitutional amendment to article III, section sixteen, which would specifically provide for and also an interim legislative committee to "allocate" contingency funds when the Legislature is not in session. If the voters approve this amendment at the next election when it is referred, most of the constitutional issues I have discussed would be essentially eliminated. Until such time as the constitutional amendment becomes effective, or our courts resolve the issues you present, I will continue to have the above discussed reservations in regard to the issues you raise.

Respectfully submitted,

William Janklow
Attorney General

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