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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