                    January   20, 1967


Honorable Robert S. Calvert              Opinion   No. M- 13
Comptroller of Pub1.lcAccounts
Austin, Texas                            Re: Construction of Article
                                             678f, Vernon's Civil
                                             Statutes, a8 It relates
                                             to expenditures of ap-
                                             propriations for bulld-
                                             ing projects from which
                                             the State Building Fund
Dear Mr. Calvert:                            is to be reimbursed.
          Your request for an opinion on the above subject matter
asks the following questions:
            "1. Is the money appropriatedto a using
     agency for the fiscal year 1966 only, with which
     to build a building, obligated by the provisions
     of Article 678f, R.C.S. so that salaries and
     travel   and other personal services performed on
     the building project by the Building Commission
     during the fiscal years 1967, 1968, and 1969,
     are reimbursable from the 1966 year appropriation?
          "2. If the above question is answered In
     the affirmativeand under the same conditions
     as set out In question number 1, would this be
     the only appropriationsuch services could be
     reimbursed from?
          "3. If money Is appropriated to a using
     agency for capital outlay for the fiscal year
     ending August 31r 1966, the using agency then
     through the Building Commission obligates the
     appropriationto remodel an existing building
     In the amount of twenty-five thousand dollars
     ($25,000.00)(Art. 4357, R.C.S.) Is the capital
     outlay appropriationfor 1966 obligated to re-
     imburse the Building Commission for salaries
     and travel performed on the remodeling project
     by the Building Commissionduring the fiscal
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                                                                     ,




Hdn. Robert S. Calve&, page 2 (M-13)


    years 1967, 1968, and 19697
         "4. If question number 3 Is answered In
    the affirmativeand under the same conditions
    as set out In question number 3, would this be
    the only appropriationsuch services could be
    reimbursed from?"
          Subdivision (E) of Section 5 of Article 678f, Vernon's
Civil Statutes,reads as follows:
         "The operating expenses of the State
    Building Commission shall, unless otherwise
    specifiedby the Legislature,be paid from
    appropriationsmade out of the State Building
    Fund. The State Building Fund shall be relm-
    bursed Tar such expendituresfrom the funds
    appropriatedby the Legislaturefor projects
    supervisedby the Commission. In order that
    each project shall bear Its fair and proper
    share of the Commission'sexpenses, the Com-
    mission shall Institute and maintain a cost
    accounting system which shall be devised by
    the State Auditor as soon after the effective
    date of this Act as possible.' (Emphasis
    added.)
          Section 6 of Article VIII of the Constitutionof Texas
provides that no appropriationof State funds may be mad~efor a
term of more than two years. Therefore, generally speaking,
personal servicesmust be paid out of appropriationsmade for
the year during which the personal services are rendered, At-
torney General's Opinions O-2815 (1940) and V-1397 (1952). It
Is clearly settled, however, that an appropriationfor one year
In the case of capital expendituresmay legally be encumbered by
contract even though the project for which It Is spent will not be
completed and paid for until succeedingyears. Attorney General's
Opinions 0-2631 (1940), V-11 9 (1950 V-1397 (1952), V-1535A
(19521, Ww-40 (19571, and Ca25 (196i1.
          In Attorney General's Opinion V-1397, supra, it was
held that a contract calling for the services of an erection
supervisorIs ancillary to the main purpose of the purchase of
a capital asset and is not a separate contract for personal
services, and therefore expenditurefor such purpose may be paid
from an appropriationcovering the cost of the constructioncon-
tract.


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Hon. Robert S. Calve&, pa&     3 (M-13)


           The reimbursable Items gdverned by the provisions of
Article 678f are all items~lncldentalto a constructionproject
which constitutesareapIta asset of the State. Therefore, such
items may obligate appropriationsfor a term beyond the ex lra-
tlon of the appropriation. Both Article 678f and Article e357,
Vernon's Civil Statutes, recognize ,thatln the case of construc-
tion projects monies obligated by the constructioncontract will
not necessarily be finally expended.during the term of the ap-
propriation. Article 4357 provides In part:
           ,I
              . .No claim shall be paid from approprla-
     tlons kless presented to the Comptrollerfor
     Payment within two (2) years from the close of
     the fiscal year for whlch'such appropriations
     were made, but any claim .notpresentedfor pay-
     ment within such period may be presentedto the
     Legislature as other claims for which no approprla-
     tlons are available. . . ,
             "It Is specificallyprovided, however, that
     as to all approprlatlonsrelating to new con-
     struction contracts, and to repair and remodeling
     projects    which exceed the sum of Twenty Thousand
     Dollars ($20,000.00),Including In either Instance
     furniture and other equipment, architects'and
     engineering fees, and other related costs, any
     claim may be presented for payment within four
     (4) years from the close of the fiscal year for
     which such appropriationswere made."
          In answer to your first and third questions,monies
appropriatedto a using agency for projects governed b Article
678f are obligated by the provisions of Subdivision (E3 to reim-
burse the State Building Fund for servicesrendered by the Bulld-
lng Commission on the constructionproject. Therefore, you are
advised that this reimbursement Is to be paid from the appropriation
for the constructionproject regardless of the year In which the
personal services were performed on the building project. The
services outlined by you In questions one and three would be
paid from the 1966 appropriation. In answer to your second and
fourth questions, this would be the only appropriationfrom which
the services could be reimbursed unless other appropriationsfor
such project are apprdprlated or re-appropriatedas the case may
be.
                     SUMMARY
         Monies encumbered by a constructioncontract
     entered Into during the fiscal year 1966 may be
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Hon. Robert S. Calvert, page 4 (M-13)


     used to reimburse the State Building Fund for
     operating expenses of the State Building Com-
     mission expended in connectionwith such construc-
     tion contract, and such reimbursementmay be made
     even though services performed by the Building
     Commission are performed during subsequentfiscal
             Art. 678f, v.c.s., Attorney General's
     ~~?iikn V-1397 (1952).




Prepared by John Reeves
Assistant Attorney General
APPROVED:
OPINION COMMI'ITEE
Hawthorne Phillips, Chairman
W. V. Geppert, Co-Chairman
Mary K. Wall
Kerns Taylor
Pat Bailey
John Grace
Staff Legal Assistant
A. J. Carubbl, Jr.




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