After the General Assembly failed to pass HB 207 (which would have appropriated Highway Fund money to raise Highway Patrol telecommunicator salaries), is the Office of State Personnel barred from reclassifying telecommunicator positions statewide?

Plain-English summary

Ronald G. Penny of the State Personnel Commission asked whether N.C. Gen. Stat. § 143-16.3 prevented the Office of State Personnel (OSP) from adjusting salaries of employees in the telecommunicators' class. The trigger: in the 1994 Extra Session, House Bill 207 was introduced. Sections 8 and 9 of HB 207 would have appropriated money from the Highway Fund to the Department of Crime Control for salary adjustments for all Highway Patrol telecommunicators. The bill did not pass. In April 1994, OSP separately conducted a statewide study of telecommunicator positions across state government and recommended reclassification.

The concern: did HB 207's failure (a deliberate legislative choice not to fund Highway Patrol telecommunicator raises) preclude OSP from going ahead with its own reclassification study, which would also result in pay increases? Senior Deputy AG Ann Reed and Special Deputy AG Lars F. Nance said no.

OSP's authority was uncontroversial outside the HB 207 backdrop. Under G.S. 126-1 and 126-4, the State Personnel Commission and OSP periodically review and compare salaries of state employees and competitive employers. Chapter 126 vests them with broad rulemaking power on personnel matters. North Carolina Dept. of Justice v. Eaker, 90 N.C. App. 30 (1988). OSP is required to maintain a personnel system applying the best methods evolved in government and industry. Administrative responsibilities include position classification and reclassification, maintaining a relative scale, and recruitment. G.S. 126-3, 126-4(1), (4). A paygrade may need review for reasons beyond market factors, including equal-pay considerations under 29 U.S.C. § 206(d) (the federal Equal Pay Act): if telecommunicator positions are occupied predominantly by women and similar work is at a higher grade and occupied predominantly by men, OSP would be on solid ground to revisit the grade.

The narrow question was about § 143-16.3, which prohibits expending funds for purposes the General Assembly has considered and rejected. The AG read HB 207 narrowly. The bill's purpose was to appropriate additional money from the Highway Fund to Crime Control specifically to fund Highway Patrol telecommunicator raises. A statewide reclassification study by OSP, with the Commission approving reclassification of those positions, is not the same purpose. The reclassification would draw on funds the legislature had previously allotted to the Department of Crime Control and Public Safety, not on new Highway Fund money.

So § 143-16.3 was no barrier. The failure of HB 207 does not divest OSP and the Commission of statutory authority to keep state positions market-competitive. A classification market survey is OSP's independent responsibility. Telecommunicators throughout state government are not frozen in grade just because the General Assembly chose not to make a separate Highway Fund appropriation for one slice of them.

Currency note

This opinion was issued in 1994. 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.

The State Personnel Act framework in Chapter 126 has been substantially restructured since 1994. Most notably, the State Personnel Act was renamed the State Human Resources Act in 2013 and the State Personnel Commission was renamed the State Human Resources Commission, with various structural changes including the introduction of the "State HR Director" position. Many sections of Chapter 126 have been recodified or amended. G.S. 143-16.3 remains the general "no funds for rejected purposes" rule but should be read in light of any later legislative gloss. Anyone with a current personnel classification question should consult current Chapter 126, current OSHR rules, and counsel familiar with state personnel administration.

Common questions

Q: What does G.S. 143-16.3 actually prohibit?
A: It bars an agency from spending funds for a purpose the General Assembly has considered and rejected. The classic case is when an agency tries to use existing money to do something the legislature specifically refused to fund. The AG's framing in this opinion narrows the rule: the rejected "purpose" has to match the proposed expenditure, not just overlap with it.

Q: Why was HB 207's purpose narrower than "telecommunicator raises"?
A: Because HB 207 had two distinct features: (1) it would have appropriated new money from the Highway Fund (a constitutionally-restricted fund), and (2) it would have raised salaries for Highway Patrol telecommunicators specifically. OSP's reclassification used neither: no new Highway Fund money, and the scope was statewide telecommunicators, not just the Highway Patrol. The AG treats those differences as material.

Q: Does the reclassification actually result in pay raises?
A: If positions are reclassified to a higher grade, yes. The pay increase comes from funds already in the relevant agency budgets, not from a new appropriation. The Department of Crime Control would need to absorb the Highway Patrol telecommunicator portion within its existing allotment, which may pinch other parts of the budget.

Q: What does the Equal Pay Act analogy add to the analysis?
A: It illustrates that OSP's reclassification authority exists for multiple legitimate reasons beyond market competitiveness, including federal civil rights compliance. Limiting OSP to market-only adjustments would put the State at risk of equal-pay violations when positions held predominantly by women are graded lower than similar work held by men.

Q: Does this opinion apply outside the personnel context?
A: The framework does. § 143-16.3 has been applied to a range of situations where agencies wanted to spend on something the legislature considered. The AG's "purposes have to match" reading is portable: an agency cannot do something the legislature specifically rejected, but can do something that overlaps with the rejected proposal without being the same purpose.

Q: Could the General Assembly close the gap by writing a broader prohibition?
A: Yes. If the General Assembly wants to truly freeze telecommunicator pay across state government, it can pass a bill that explicitly does so. Failing to pass HB 207, by contrast, did not amount to such a freeze; it just declined to authorize the specific Highway Fund appropriation HB 207 proposed.

Background and statutory framework

NC's State Personnel Act (now State Human Resources Act) creates a centralized personnel system for most state employees. OSP runs the day-to-day operations; the State Personnel Commission (now Human Resources Commission) provides oversight and rulemaking. The system covers position classification, salary administration, recruitment, and discipline.

Position reclassification is one of OSP's standing tools. If a job's duties have evolved or market rates have shifted, OSP can move the position to a different paygrade. The General Assembly preserves overall budget control by setting agency appropriations; OSP works within those allotments.

§ 143-16.3 is part of the budget-control framework. It tells agencies they cannot route around legislative rejection of a specific spending proposal by using existing funds for the same purpose. The 1994 opinion is a useful example of how that rule plays out in practice: a narrow legislative rejection (HB 207's Highway Fund appropriation for Highway Patrol telecommunicator raises specifically) does not block a broader administrative action (statewide OSP reclassification of telecommunicators using existing agency funds).

The opinion sits in a longer line of guidance from this Office that interprets § 143-16.3 by reference to the precise legislative purpose at stake. Practitioners advising state agencies on whether the statute blocks an action should read the failed bill carefully and look for any place where the proposed action diverges from the bill's "purpose."

Citations

• N.C.G.S. § 126-1, 126-4 (State Personnel Commission and OSP authority over salaries and personnel administration; Chapter 126 renamed State Human Resources Act after 2013)
• N.C.G.S. § 126-3 (OSP responsibilities including position classification)
• N.C.G.S. § 126-4(1), (4) (specific rulemaking on classification and recruitment)
• N.C.G.S. § 143-16.3 (prohibition on expending funds for purposes the General Assembly has considered and rejected)
• 29 U.S.C. § 206(d) (federal Equal Pay Act; reclassification authority used to maintain pay equity for similar work)
• North Carolina Dept. of Justice v. Eaker, 90 N.C. App. 30, 367 S.E.2d 392, cert. denied, 322 N.C. 836, 371 S.E.2d 279 (1988) (NC Court of Appeals; State Personnel Commission and OSP have broad rulemaking authority on personnel matters)

Source

• Landing page: https://ncdoj.gov/opinions/authority-of-osp-to-adjust-the-salaries-of-employees-in-the-telecommunicators-class/

Original opinion text

June 10, 1994

Mr. Ronald G. Penny
State Personnel Commission
Administration Building
Raleigh, N. C. 27602

RE: Advisory opinion: Authority of OSP to Adjust the salaries of employees in the Telecommunicators' Class; G.S. 143-16.3

Dear Mr. Penny:

This letter is in response to your letter dated May 13, 1994, received by me on May 20th, and in follow-up to our telephone conversation last week. As your letter states "the essential issue . . . is whether N. C. Gen. Stat. §143-16.3 prohibits [OSP] from [adjusting the salaries of employees in the telecommunicators'] class." The potential problem as you see it is that House Bill 207, Sec. 8 and 9, as introduced in the 1994 Extra Session, proposed a salary adjustment for all Highway Patrol telecommunicators. The bill, which among other things involved appropriating funds from the Highway Fund to the Department of Crime Control for salary adjustments, was not enacted. In April 1994, the Office of State Personnel conducted a study of telecommunicators throughout state government and, based on the study, recommended that the positions be reclassified.

It is uncontroverted that absent H.B. 207's failure, OSP would be able to implement the Telecommunicators' Study without legislative approval. Under G.S. 126-1 and 126-4, the State Personnel Commission and the Office of Sate Personnel periodically review and compare salaries of State employees and competitive employers. Chapter 126 clearly gives the State Personnel Commission and the Office of State Personnel the power to establish rules and policies governing personnel matters. See, North Carolina Dept. of Justice v. Eaker, 90 N.C. App. 30, 367 S.E.2d 392, cert. denied, 322 N.C. 836, 371 S.E.2d 279 (1988).

OSP, under G.S. 126-1 and 126-4, is charged with the responsibility of "maintain[ing] a system of personnel administration that [applies] the best methods as evolved in government and industry." Administrative responsibilities include: position classification and reclassification, maintaining a relative scale, and providing recruitment programs designed to attract employees and promote public employment. G.S. 126-3 and 126-4(1), (4). A job's paygrade may need review for other than market factor reasons. For example, a problem could exist if the patrol telecommunicator positions were occupied predominately by females and jobs requiring equal work occupied predominately by males were classified at a higher pay grade. See, 29 U.S.C. §206(d), The Equal Pay Act.

G.S. 143-16.3 prohibits an expenditure of funds for purposes which the General Assembly has considered and rejected. H.B. 207, among other things, would have expanded the Department's budget by an appropriation from the Highway Fund to provide a salary adjustment for all Highway Patrol telecommunicators. A reclassification study of all telecommunicator positions throughout state government by OSP or the State Personnel Commission's approval of a reclassification of these positions is not the same purpose as H.B. 207. If salary increases result from the reclassifications of telecommunicators in the Highway Patrol, they will come from funds the legislature has previously allotted to the Department of Crime Control and Public Safety. A determination by OSP and the Commission that a reclassification of telecommunicator positions is in order does not cause the expenditure of funds for a purpose rejected by the legislature.

In summary, it is our opinion that the failure of H.B. 207 does not divest your office and the Commission of your statutory authority to insure that State government positions remain competitive with the market. A classification market survey is OSP's independent responsibility. The purpose of H.B. 207 was to appropriate additional funds to Crime Control from the Highway Fund to adjust the salaries of Highway Patrol telecommunicators. The fact that this bill was not enacted does not mean that every telecommunicator position throughout State government is frozen in grade and that the Office of State Personnel is prohibited from keeping telecommunicator positions competitive with the market.

Ann Reed
Senior Deputy Attorney General

Lars F. Nance
Special Deputy Attorney General