.   .



                THE       ATI-ORNEYGENEI&I&
                               OP    TEXAS




                                       day 14, 1948

        Hon. Qeo. H. Sheppard                  Opinion lo. v-577
        Comptroller of Public Accounts
        Austin, Texas                          Re: Use of funds given
                                                   by Federal Oovern-
                                                   ment to State De-
                                                   partment of Health
                                                   for matching pllr-
                                                   poses under 38:
                                                    ployees    Retirement
                                                    Syrtem    Act..

        Dear   Sir:

                      Your request   for   an ~opiniiiii Is as f 0110w!?4:
                     “The question has arisen in this
               department as to whether the Federdl
               funds granted to the Health Departtint
               from which salaries ‘nvly be :paid‘shall
               be used for matching the StB$e*s contri-
               bntlon for such employees to ,the, Retire-
               ment Syrtem.    I shall,  therefore,  thank
               you to advise this department whether
               such Federal funds shall be transferred-~
               by the Comptroller to the Retirement Sys-
               tem funds bs provided ior under the Re-
               tirement Act O If your answer is in the
               negative,  that Is, that suah funds can-
               not be tliansferred  for~the benefits    of
               the Retirement System, from what source
               or fund shalf the matching contributions
               be provided?
                    re are advised orally by a member of your of-
        fice that    the Federal funds granted to $he Health De-
        partment from which salaries     may be paid refers to the
        money given to the State Department of Health bg the
        $d~lCO~ernment        in accordance with the provisions   of
                       Sec. 246, after certain conditiona    and bud-
        geta;y’riq&ements      have been met by the Health Depart-
        ment to the satisfaction     of the Surgeon General of the           6
        United States.     The funds granted the State by the Fed-
        era1 Government through the Surgeon General are to be
                                                                      I   .




Hon. Gee. Ii. Sheppard,        page 2   (v-577)


used in tarrying out the broad objectives        of venereal
diseasei:tu$er.culosis,     and mental disease prevention and
cure and coping with special health ptioblems under the
provisions    of the Public Health and Welfare lava of the
liational Cto.vernment. The Surgeon General is authorized
to withhold further payments to the State upon a finding
that the State’s health authority has failed        to aomply
substantially     with either the provisions   of Sec. 246,
budgetary plan8 submittef) by the State “;td approved by
the Surgeon General, or the regulations        .
           “Department”, “Employee”, and “ihployer* are
defined in Ii. B. 168, 50th Legislature, which is codifl-
ed as Art. 6228a, V. C. S., aa follows:
             “Section      1 . . .
            mB. ‘Department’ 8hall mean any de-
      patimer&, commLssion, institution, or, agen-
      cy of the State ffovernment..
            %    Qmployee’ shall mean any rego-
      laFl> rpppointed officer  or emplope in
      a ~department of the State . . .

           ‘3,  %aployer 1 8hall        mean the State
      oi T&8 aIt
          : Ileo.   8.A.    of raid H. B. 168, provides,   In part,
aa follovsf
            “The amount contribtited by each mem-
      ber to ~th Retirement System ahall,be five,
      per cent ‘45s) of the regular annual compen-
      sation, paid. to each member. The amouut con-           -
      tributed ‘by’.the State of Texar to the Rs-
      tirement Sagtern shall not exceed during any
      one (1) year five per cent (5s) of salaries
      of alk*members, disregarding     salaslsa in
      amounts In exCe s of Three Thousand Six
      Hundred Dollars P$3,600),     provided the to-
      tal amount contributed    by the State during
      a&y one (1) year shall at least dqual the
      total sslount contributed    dwlng the same
      year by all members of the Retirement Sy8-
      ten; provided further that all contribu-
      tions made by the State ahall be froa and
      charged to the resvective     fund8 aDta?oDFia-
      ~
      ted,, a                                th
Hon. Gee, H. Sheppard,           page 3   (V-577)


        salary OF compensation of the emploVee
        for whose benefit the contribution Is
        maQe 0 *I’ (l3mphasls otlrsl
              Set, 8,B.   2.a.     of Said H, B, 168, provides,   in
part,    as follovsn
               ‘a*  Prom and after the date of the
        establishment    of the membership and full
        operation of the Retirement System creat-
        ed by this Act takes effect,       there 1~
        hereby allocated    and apvrovriated     to the
        %mployees Retirement System of Texas, In
        accordance with this Act, from the sever-
        al funds from which the employees benefit-
        ed bs this Act receive their respective
        salaries    a sum equal to five per cent (5$)
        of the t&al compensation paid to the said
        respective   employees who are members of
        said Retirement System an& whose comoen-
        sation is paid from funds directly         con-
        tpolled by the States       Thhc.
                                        F4t.nf.nRnnnA
                                    -Y" _"I""   -"-A..nf"A
        bustees    (meaninnv th--% board of seven mem-
        bers responsible    for the operation of the
        Retirement System) shall certify        to the
        State Comptroller of Public Accounts and
        the State-Treasurer      at the end of each
        month the total amount of compensation
        paid such member of the Retirement Sys-
        tem, and the State Comptroller shall
        therewon transfer five per cent (58) of
        this amount from the said       respective    fundg
        from which said employees are ~&ig to Fe
        State Employees Retirement Fund; D D o
        @mphasis ours)
            We are ‘informed further by .a.: Health Depart-
ment representative     that the question of the use of Fed-
era1 funds for matching purposes under the Retirement
Act was submltted to the Surgeon General and this use
was’approved.    This being the case, the Federal funds,
once deposited to the State es account or In the State
TPeaswy under the terms of the Public Health laV8 of.
the United States, become state funds fop all purposes.
and intents,   and are appropriated    by the Legislature     In
accordance with the budget aubmltted by the Health De-
partment to and approved by the Surgeon General.          There
funds are earmarked fop public health uses, yet they am
State property as title     has passed by gift from the Fed-
                                                               .


Hon. ffeo. H. Sheppard,   page 4    (v-577)


era1 ffovernment to the State.     They are fund8 UUd4P con-
trol of and subject to appropriation     b the Texas Lsgls-
lature for the payment of salaries     of ii4alth Dopartnmt
employees as well as fulfilling     the other objects  out-
lined in the Health Department budget approved by the
Surgeon General.   We believe they are State funds vith-
in the purview of the underlined portions of the Retlre-
mont Act and may be utilized    for matching purposes under
the tsrms of this Act.
             The sourc4 of the funds out of which am iruI1~
vidual is paid Is not controlling,      .It is the fact that
the Department of Health is charged with the responsl-
bllity   of paying an IndFvidual~s salary and that the
employee fall.8 within the definition     of "employee" giv*
en In the Retirement Act'plus     tkw fact that the Feder-
ally-donated    funds 4r4 Stat4~ovned property and subject
to direct control of and appropriation      by the Legisla-
two.    They are within the ambit of the Comptroller*s
authority to transfer a portion thereof (5$) to the Em-
ployees Retltiement Fund.
                          SUMMARY

          Funds given to the Sa.%tqiDepartllsnt
     of Health by the Federal Q&omont      und4r
     the Public HeaLth and Welfara laws of the
     United States, 42 U.S.CA,,   944. 246, ny
     be utilized  for matching parposes by the
     Comptroller of Public Account~s under the
     terms of the State hployeer Retlrenent
     Act.   Art. 6228a, V. C. 9.
                                      ~Yours very truly,
                                   A?X'OREEYGEIURAL
                                                  OF TEXAS



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