Could Idaho’s Labor Department spend dedicated account money without an annual appropriation in 1985?

Plain-English summary

The Idaho Department of Labor and Industrial Services asked whether it could spend from its dedicated electrical board, plumbing board, and building code accounts without going through the annual budget and appropriation process. The laws creating those accounts used continuing-appropriation language, including “perpetually appropriated” for the plumbing account. The Attorney General said that language would normally be enough to authorize spending without a new annual bill, but chapter 35 of title 67 required an annual process for these accounts.

Under the cited budget statutes, departments reported revenue and spending from all sources, the executive budget accounted for all funds, and the legislative appropriations committee prepared bills covering agencies operating under continuing appropriations. Appropriation acts then set fixed budgets that agencies could not exceed. The AG concluded the Department had to follow that process before spending, and the amount it could spend each fiscal year was controlled by the legislature. He noted that certain endowment fund appropriations had a statutory exception, but these three accounts did not.

Currency note

This opinion was issued in 1985. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

What were the three accounts in the opinion?

The electrical board account, plumbing board account, and Idaho building code fund. The opinion says each received money from fees charged by the Department and had continuing-appropriation language in its creating statute.

Was a continuing appropriation unconstitutional?

No. The AG cited McConnel v. Gallet for the rule that a continuing appropriation limited to the money in a special state fund was constitutionally permissible. The issue here was the additional annual budget requirements in chapter 35.

What limited the Department’s spending each year?

The AG cited Idaho Code § 67-3516, which treated appropriation acts and related allotments as fixed budgets whether an underlying appropriation was fixed or continuing. The Department could spend only the amount allowed by its annual appropriation bill.

Did any continuing appropriations avoid this process?

The opinion notes an exemption in Idaho Code § 67-3530 for certain endowment and endowment income funds. It says no comparable exception applied to the Department’s three dedicated accounts.

Background and statutory framework

The opinion considered dedicated accounts under Idaho Code §§ 39-4124, 54-1015, and 54-2630. It read those provisions alongside chapter 35 of title 67, including the annual reporting and budgeting rules in §§ 67-3503, 67-3505, and 67-3507, the appropriation-bill rule in § 67-3514, and the fixed-budget rule in § 67-3516. The AG said the accounts dedicated revenue for the Department’s exclusive use while leaving annual spending levels under legislative control.

Citations

• Idaho Code §§ 39-4124, 54-1015, 54-2630, 67-3503, 67-3505, 67-3507, 67-3514, 67-3516, 67-3530.
• McConnel v. Gallet, 51 Idaho 386, 6 P.2d 143 (1931).

Source

• Landing page: https://www.ag.idaho.gov/office-resources/opinions/
• Original PDF: https://ag.idaho.gov/content/uploads/2018/04/OP85-07.pdf

Original opinion text

STATE OF IDAHO

OFFICE OF THE ATTORNEY GENERAL

Jim JONES BOISE 83720 TELEPHONE
ATTORNEY GENERAL (2081.334-2400

Attorney General No. 85-7

TO: Mr. Gary H. Gould

Director, Department of

Labor and Industrial Services
STATEHOUSE MAIL

Per Request for Attorney General Opinion

QUESTION PRESENTED

Are dedicated fund divisions of the Department of Labor and Industrial Services required to go through the budgeting and appropriation procedures set out in title 67, ch. 35, Idaho Code, before expending the fund in the respective division's dedicated fund accounts? This question is posed because the provisions in the Idaho Code relative to those accounts (§§ 39- 4124, 54-1015, and 54-2630) do contain language which suggests that the funds in these accounts may be perpetually appropriated to the Department.

CONCLUSION

The dedicated fund divisions of the Department of Labor and Industrial Services are required to go through the budgeting and appropriation procedures of ch. 35, title 67, Idaho Code, before expending the dedicated funds. ANALYSIS

The Department of Labor and Industrial Services is funded from the general account, interaccount billings, the mine safety

Mr. Gary H. Gould

Director, Department of
Labor and Industrial Services
Page 2

training grant account, and three dedicated accounts. Chapter

90, 1985 Sess. L. The three dedicated accounts include the electrical board account, the plumbing board account and the Idaho building code account. Each of these dedicated accounts

receives funds from various fees that the Department charges.

The statutes creating the three dedicated accounts provide for continuing appropriations to the Department from those accounts. For example, Idaho Code § 54-2630, which creates the Idaho plumbing board account, provides in pertinent part:

All such moneys, hereafter placed in said account, are hereby set aside and perpetually appropriated to the department of labor and industrial services to carry into effect the provisions of this act.

Idaho Code §§ 39-4124 and 54-1015 create the Idaho building code fund and the electrical board account. Those code sections also contain continuing appropriation language nearly identical to the continuing appropriation language of Idaho Code § 54-2630 quoted above.

If the three continuing appropriation statutes were not modified by other statutory provisions, they would provide sufficient authority for the Department to spend funds of those accounts without the need for an annual appropriation bill. For example, in McConnell v. Gallet, 51 Idaho 386, 6 P.2d 143 (1931), the Idaho Supreme Court considered a similar continuing appropriation from the Adjutant General's contingent fund. The Court held that there is no constitutional inhibition against such continuing appropriation, provided the continuing appropriation is limited to amounts in a special fund of the state.

Thus, if there were no other statutes providing for annual budgeting and appropriation of funds that have been continually appropriated, there would be no necessity to go through the annual budgeting and appropriation procedures. However, as discussed below, ch. 35, title 67, Idaho Code, requires annual budgeting and appropriation of continually appropriated funds.

Several sections of ch. 35, title 67, Idaho Code, require agencies receiving continuing appropriations to comply with the

Mr. Gary BE. Gould

Director, Department of
Labor and Industrial Services
Page 3

annual budgeting and appropriation process. Idaho Code § 67- 3503 provides in pertinent part:

Each department, office and institution ... shall, not later than the 15th day of August

... prepare and file in the office of the adminstrator of the division [of financial management] ... its report of receipts from

all sources, including appropriations made by the legislature, its expenditures of all sums received from all sources, segregated as provided for in the blanks, and its estimates of receipts and expenditures for the current and succeeding fiscal years.
{Emphasis added]

Following receipt of the Eoregoing information, the administrator of the division of financial management submits to the governor and the Joint Finance/Appropriation Committee information for the budget, pursuant to Idaho Code § 67-3505.

The governor is then required to submit the executive budget to the legislature. Pursuant to Idaho Code § 67-3507 the executive budget must include detailed information as to the needs of the various departments for the next fiscal year, and provides:

All funds, including federal and local funds and interaccount receipts received for anv purpose, shall be accounted for in the budget. [emphasis added]

The foregoing sections reflect a legislative intention to deal with all sources of fundincg as part of the annual appropriation process.

Idaho Code § 67-3514 deals with the responsibility of the Joint Finance/Appropriation Committee in preparation of appropriation bills and deals specifically with continuing appropriations. That section provides in pertinent part:

[p] roviding further, that for any
department, office, or institution operating in part or in whole under a continuing

appropriation or fund authorized by the

Mr. Gary H. Gould

Director, Department of
Labor and Industrial Services
Page 4

legislature, the joint committees of the legislature having jurisdiction of appropriations shall, after examining the budget, prepare and introduce appropriation bills covering all the requirements of the respective departments, offices, and institutions of the state operating under each such continuing appropriation.

Thus, the Joint Finance/Appropriation Committee is reguired to prepare an appropriation bill covering all the requirements of departments, such as the Department of Labor and Industrial Services, which operate in part under a continuing appropriation or fund authorized by the legislature.

Finally, Idaho Code § 67-3516 provides in pertinent part:

Appropriation acts when passed by the
legislature of the state of Idaho, and allotments made thereunder, whether the appropriation is fixed or continuing, are fixed budgets beyond which state officers, departments, bureaus and institutions may not expend. (Emphasis added}

The foregoing statutes clearly require departments such as the Department of Labor and Industrial Services to follow the annual budgeting and appropriation process of ch. 35, title 67, Idaho Code, and to limit fiscal year expenditures to the amount appropriated by the annual appropriation bill. The effect of the legislature's creation of the three dedicated accounts for the department is to set aside and dedicate certain revenues for the exclusive use of the department. However, the amount of such revenue that can be expended in any fiscal year is controlled by the legislature through the annual appropriation process.

We note that certain continuing appropriations, such as those regarding endowment funds or endowment income funds are exempted from the provisions of ch. 35, title 67 (Idaho Code
§ 67-3530). However, there is no comparable exception applicable to the dedicated funds of the Department of Labor and Industrial Services.

Mr. Gary H. Gould

Director, Department of

Labor and Industrial Services
Page 5

AUTHORITIES CONSIDERED:

Idaho Code § 39-4124
Idaho Code § 54-1015
Idaho Code § 54-2630
Idaho Code § 67-3503
Idaho Code § 67-3505
Idaho Code § 67-3507
Tdaho Code § 67-5314
Idaho Code § 67-3516
Idaho Code § 67-3530

McConnel v. Gallet, 51 Idaho 386, 6 P.2d 143 (1931)

gf
DATED this 3 I= day of De Ce, , 1985.

ATTORNEY GENERAL
State of Idaho

JIM, A

ANALYSIS BY: i /]

DAVID G. HIGH

Deputy Attorney General
Chief, Business Affairs and
State Finance Division

/P ONES

cc: Idaho Supreme Court
Supreme Court Library
Idaho State Library