                            ATTORNEY GENERAL OF TEXAS
                                        GREG       ABBOTT




                                         December 15,2006



The Honorable D. Matt Bingham                            Opinion No. GA-0492
Smith County Criminal District Attorney
Smith County Courthouse                                  Re:    Whether a proposed Smith ‘County
100 North Broadway, 4th Floor                            incentive bonus plan for certain county
Tyler, Texas 75702                                       employees complies with article III, section
                                                         53 ofthe Texas Constitution (RQ-0486-GA)


Dear Mr. Bingham:

         Gn behalf of a Smith County Commissioner, you ask whether a proposed Smith County
incentive bonus plan for certain county employees complies with article III, section 53 of the Texas
Constitution.’

         You inform us that the Smith County Commissioners Court (the “Commissioners Court”)
is considering adopting an incentive bonus plan for employees in departments that report directly to
the Commissioners Court-that      is, employees of the Commissioners Court, the records service, the
veterans service, the physical plan[t], personnel, the probate court or courts, purchasing, the tire
marshal, pre-trial, and road and bridge. See Request Letter, supra note 1, at 2; Smith County
Incentive Plan, attached to Request Letter as Exhibit B, at 1 [hereinafter Incentive Plan]. Under the
proposed incentive plan, employees whose annual job performance has been meritorious would be
eligible for bonuses if they meet the following criteria:

                .     Full time employee with a minimum of one year [of] service at
                      the end of the fiscal year.

                .     Annual     performance     evaluation   rating   of  [“Imeets
                      expectationsr]   or above. Department Heads must have an
                      annual    performance     evaluation  rating   of [“Iexceeds
                      expectations[“] or above.

                .     Be an employee in good standing on the date incentive checks
                      are distributed.


          ‘See Letter from Honorable D. Matt B&ham, Smith County Criminal District Attorney, to Honorable Greg
Abbott, Attorney General of Texas, at 1 (May 11, 2006) (on file with the Opinion Committee, also available   at
http://www.oag.state.tx.us) [hereinafter Request Letter].
The Honorable D. Matt Bingham        - Page 2          (GA-0492)




                .     Department Heads must have a fully implemented      business plan
                      approved by the Commissioners Court.

Incentive Plan, supra at 1. Incentive payments will be distributed in the first quarter of the fiscal
year based on performance in the prior fiscal year. See id. You also inform us that the Incentive
Plan would stipulate that it “is provided at the discretion of the Commissioners Court” and further,
that the Commissioners Court “reserves the right to administer, modify or terminate the Plan with
or without notice.” Request Letter, supra note 1, at 2.

        Certain Smith County Commissioners question the Incentive Plan’s constitutionality.      See
id. You thus ask whether the Incentive Plan “meet[s] the requirements of [alrticle III, [slection 53
of the Texas Constitution and what is the effect if any of an incentive bonus plan that does not
include all county employees.” Id. at 1.

        Article III, section 53 forbids the legislature “to grant, or to authorize any county.   to grant
    any extra compensation, fee or allowance to a public officer, agent, servant or contractor, after
service has been rendered, or a contract has been entered into, and performed in whole or in part.”
TEX. CONST.    art. III, 5 53. Consistently with article III, section 53, a county may not pay additional
compensation to employees for work already performed. See City of Orange v. Chance, 325 S.W.2d
838, 840 (Tex. Civ. App.-Beaumont           1959, no writ) (citing Rhoads Drilling Co. v. Allred, 70
S.W.2d 576, 582 (Tex. 1934)). But a county may provide bonuses based on performance if the
county approved a bonus plan before employee recipients performed the work for which the bonuses
are given. See Tex. Att’y Gen. Op. No. GA-0204 (2004) at 3-4; Tex. Att’y Gen. Op. No. JM-1253
(1990) at 2-3.

        Your specific concern about the Incentive Plan’s validity relates to the stipulation that the
Plan “is provided at the discretion of the Commissioners Court” and that the Commissioners Court
reserves “the right to administer, modify or terminate the Plan with or without notice.” Incentive
Plan, supra at 2; see Request Letter, supra note 1, at 2. You ask whether, given these stipulations,
the Incentive Plan is “approved as part of an employee’s compensation prior to the employee
rendering service.” Request Letter, supva note 1, at 2.

        The fact that the Incentive Plan makes the award of bonuses and administration of the plan
a matter within the Commissioners          Court’s discretion does not render the Incentive Plan
unconstitutional under article III, section 53. Article III, section 53 does not prohibit payments made
for work performed under a contract or employment policy that provides merely for thepksibility
of such payments. See Tex. Att’y Gen. Op. No. GA-0204 (2004) at 3 (quoting Tex. Att’y Gen. Op.
No. K-0383 (2001) at 2). Thus, this office determined in 2004 that a school district could offer to
certain teachers bonuses that were contingent on the availability of earmarked funds. See id. at 3-4.
Similarly, Smith County may, without running afoul of article III, section 53, provide for employee
bonuses that are conditioned on the Commissioners Court’s approval.

         Under the same analysis, the fact that the Commissioners Court can modify or terminate the
Incentive Plan does not render the Incentive Plan unconstitutional     under article III, section 53,
The Honorable D. Matt Bingham        - Page 3          (GA-0492)




provided that, absent the receipt of new consideration, no modification of the Incentive Plan results
in a payment for services rendered prior to such modification. See id. at 3.

         You also ask whether, “if the incentive plan is totally at the discretion of the commissioners
court, . . the plan [is] tied to [an] employeerls performance.” Request Letter, supra note 1, at 2.
Whether a particular plan is “tied to” employee performance is a question that requires the resolution
of fact issues and is thus beyond the purview of the opinion process. Cf: Tex. Att’y Gen. Op. No.
GA-0156 (2004) at 10 (stating that fact questions cannot be answered in the opinion process).
Further, article III, section 53 does not distinguish between bonuses based on merit and bonuses
based on other criteria. Thus, an incentive plan that is not tied to an employee’s performance does
not necessarily contravene article III, section 53.

         Finally, you ask “what is the effect if any of an incentive bonus plan that does not include all
county employees.” Request Letter, supra note 1, at 1. You are concerned in particular with the
stipulation in the Incentive Plan that “Department Heads must have a fully implemented business
plan approved by the Commissioners Court.” Incentive Plan, supra at 1; Request Letter, supra note
1, at 3. You suggest that because of this stipulation an employee whose department head has not
implemented an approved business plan would not be eligible for a bonus under the Incentive Plan.
See Request Letter, supra note 1, at 3. You also express concern that an elected official could
choose to exclude from the Incentive Plan employees in the official’s office who would otherwise
be eligible to participate. See id. at 2-3.

          The fact that the Incentive Plan excludes employees whose department heads have not
implemented approved business plans or have otherwise chosen not to participate does not
necessarily render the proposed plan invalid as a matter of law. You have not named any statute that
would restrict a commissioners court’s authority to condition eligibility for bonuses in part on such
a criterion, and we are not aware of any. A commissioners court has the power to “set the amount
of the compensation” paid to county employees out of county funds. TEX. LOC. GOV’T CODEANN.
9 152.011~(Vernon 1999); see id. 5 111.008. Compensation includes incentive or bonus plans. See
Tex. Att’y Gen. Op. No. JM-1253 (1990) at 2. In general, a commissioners court’s authority to set
employee compensation is subject to review on an abuse-of-discretion          standard, and providing
different benefits to different employees does not constitute an abuse of discretion as a matter of law.
Cf: Tex. Att’y Gen. Op. No. JM- 1160 (1990) at 2 (“The fact that one employee may receive greater
sick leave than another employee would appear to be permissible so long as the additional benefits
conferred under the guidelines are not dependent upon factors that might constitute an abuse of
discretion.“).   Whether this particular criterion constitutes an abuse of a commissioners court’s
discretion is a question of fact that cannot be resolved in the opinion process. Cj: Tex. Att’y Gen.
Op. No. GA-0156 (2004) at 10 (stating that fact questions cannot be answered in the opinion
process).

        While “[bloth the federal and Texas constitutions safeguard against       discrimination
between classes of persons,” “[e]qual protection does not entitle every citizen to receive equal
benefits each time government money is spent.” Richards IJ.League ofUnited Latin Am. Citizens,
868 S.W.2d 306, 312 (Tex. 1993); We&r v. City of Sachse, 591 S.W.2d 563, 567 (Tex. Civ.
The Honorable D. Matt Bingham        - Page 4          (GA-0492)




App.-Dallas     1979, writ dism’d); see U.S. CONST.amend. 14,s 1; TEX. CONST.art. I, 5 3. Rather,
a court generally will require only that a classitication “be rationally related to a legitimate state
purpose.” Richards, 868 S.W.2d at 3 10-l 1.

                 The general rule gives way, however, when the classification
                 impinges on the exercise of a fundamental right, or when the
                 classification distinguishes between people, in terms of any right, on
                 a “suspect” basis such as race or national origin. In those instances,
                 the state action is subjected to strict scrutiny, requiring that the
                 classification be narrowly tailored to serve a compelling government
                 interest.

Id. at 3 11 (citations omitted).

         Among full-time employees who are eligible for bonuses because they have had favorable
work evaluations, the Incentive Plan, in your view, may distinguish between those whose department
heads have implemented an approved business plan and those whose department heads have not.
This is not a suspect classification; nor does the inability to receive a bonus infringe upon a
fundamental right. Cf: Mass. Bd. ofRet. v. Murgia, 427 U.S. 307,3 12 nn.3 & 4 (1976) (listing rights
that courts have identified as fundamental and classifications that courts have identified as suspect).
Consequently, the classification established by the proposed Incentive Plan must, as a matter of law,
be only rationally related to a legitimate state purpose. Whether the proposed Incentive Plan is
rationally related to a legitimate state purpose is a fact question that cannot be resolved in the opinion
process, Cf: Tex. Att’y Gen. Op. No. GA-0156 (2004) at 10 (stating that fact questions cannot be
answered in the opinion process).
The Honorable D. Matt Bingham      - Page 5         (GA-0492)




                                      SUMMARY

                       The Incentive    Plan proposed by the Smith County
              Commissioners      Court for certain county employees does not
              contravene article III, section 53 of the Texas Constitution unless
              employees are provided bonuses for work rendered before the plan’s
              adoption,    The fact that the proposed plan stipulates that bonus
              awards are within the Commissioners Court’s discretion does not
              itself render the plan unconstitutional.

                       The opinion process cannot determine            whether the
              commissioners     court would abuse its discretion          or violate
              constitutional equal protection guarantees if employees’ eligibility for
              benefits under the proposed plan is contingent on their department
              heads’ actions.

                                              Very truly yours,




                                              Attorney General of Texas



KENT C. SULLIVAN
First Assistant Attorney General

ELLEN L. WITT
Deputy Attorney General for Legal Counsel

NANCY S. FULLER
Chair, Opinion Committee

Kymberly K. Oltrogge
Assistant Attorney General, Opinion Committee
