Were profits from employee-owned vending machines in New Iberia city buildings public funds?

Plain-English summary

New Iberia's mayor asked whether proceeds from soft-drink machines in employee-only areas of city facilities were public money. In this 2006 opinion, the Attorney General concluded that the profits were not public funds. Employees had bought, operated and maintained the machines without public money, even though the machines sat on public property.

The employees used sales revenue to restock the machines and spent profits on items such as flowers for sick or bereaved colleagues, holiday food, employee lunches, cable service at the fire department, cooking supplies and gifts. The AG said the employees could use the profits for the purposes described. Its reasoning depended on employee ownership and funding of the machines; it did not decide a different arrangement involving public purchase, lease or operation.

Currency note

This opinion was issued in 2006. 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

Did placing the machines on city property turn their profits into public money?

No. The AG focused on the employees' ownership, operation and maintenance without public funds, despite the public location.

Could employees spend the profits on lunches and gifts described to the AG?

Yes. The opinion expressly approved use of these private profits for the listed employee purposes.

Did the opinion decide whether city-funded vending machines would have private profits?

No. It specifically relied on the machines being neither leased, purchased, operated nor maintained with public money.

Did the AG rule that the employees' arrangement was exempt from any audit?

The mayor suggested that result, but the AG's stated holding was that the profits were not public funds and could be used for the listed purposes. It did not independently analyze audit procedure.

Background and statutory framework

The opinion gave a fact-specific public-funds classification. It relied on the source of the machines and their operating costs, citing two earlier Louisiana AG opinions in accord. No statute or case was identified as controlling this particular vending arrangement.

Citations

• Attorney General Opinion No. 79-1194 and 79-1194-A (earlier opinions cited in accord).

Source

• Landing page: https://www.ag.state.la.us/Opinions
• Original PDF: https://www.ag.state.la.us/Opinion/Download/05-0429

Original opinion text

April 20, 2006
OPINION NUMBER 05-0429

Hon. Hilda D. Curry, Mayor
City of New Iberia
90-A-1 PUBLIC FUNDS AND CONTRACTS
457 East Main Street
Profits from vending machines owned, operated and New Iberia, Louisiana 70560 maintained by employees of the City of New Iberia are not public funds.
Dear Mayor Curry:

You requested an Attorney General’s opinion regarding the use of funds generated from vending machines owned and maintained by employees. You indicate that employees for the City of New Iberia’s Public Works, Wastewater and Fire Departments utilize soft drink machines which are owned, operated and maintained by employees without the use of public monies. The machines are on public property, but are not used by the public. The machines are located in areas only accessible to City employees. Monies generated form the sale of soft drinks are used to re-stock the machines and the profits are used by the employees for various purposes, including purchasing flowers for sick or deceased employees or family members, purchasing hams or turkeys on special holidays, employee luncheons, payments for cable television in the Fire Department, purchasing cooking utensils and food items for special occasions, and gifts to employees on special occasions. You question whether the profits generated from the vending machines may be used for such purposes. You believe that the profits are not public funds subject to an audit review.

Because the vending machines are owned, operated and maintained by employees, and not leased, purchased, operated or maintained with public monies, it is the opinion of our office that profits from the machines should not be considered public funds. In accord are Attorney General Opinion No. 79-1194 and 79-1194-A. As such, the employees may use the vending machine profits for the above-described purposes.

Trusting this adequately responds to your request, we remain

Yours very truly,

CHARLES C. FOTI, JR.
ATTORNEY GENERAL

BY: _________
KENNETH L. ROCHE, III
Assistant Attorney General

CCF, JR/KLR, III/jv

Page 2

Opinion Number 05-0429

90-A-1 PUBLIC FUNDS AND CONTRACTS

Profits from vending machines owned, operated and maintained by employees of the City of New Iberia are not public funds.

Hon. Hilda D. Curry, Mayor
City of New Iberia
457 East Main Street
New Iberia, Louisiana 70560

Date Received:

Date Released: April 20, 2006

Kenneth L. Roche, III
Assistant Attorney General