How is the 10% fee cap for a Texas state-employee charitable campaign manager calculated?

TX AG Opinion GA-0565: How is the state charitable campaign manager's fee calculated?

Plain-English summary

The Texas state employee charitable campaign lets state employees voluntarily authorize paycheck deductions to support charities. It runs statewide each autumn but is administered locally, with a state campaign manager and a local campaign manager in each local campaign area. A campaign manager may charge participating charities a fee for actual campaign expenses, but Government Code section 659.148 caps that fee. The question put to the Attorney General was how the 10 percent cap in section 659.148(c) works: is each local campaign manager limited to 10 percent of the contributions collected in his own area, or are the combined fees of the state manager and all local managers limited to 10 percent of everything collected statewide?

The Attorney General read the statute the second way. Section 659.148(c) ties the fee to the "combined expenses of the state campaign manager and each local campaign manager" and to "10 percent of the total amount collected" in the campaign, and subsection (b) speaks of "the total of contributions" in the campaign as a whole. Reading the plain language to give effect to legislative intent, the AG concluded the cap is measured against the aggregate amount collected on a statewide basis. So a local manager whose own expenses run above 10 percent of his area's collections could still recover his full expenditures, as long as the combined statewide expenses stayed within 10 percent of total statewide contributions. The cap can be exceeded only if the state policy committee approves a higher amount to accommodate reasonable documented costs.

Currency note

This opinion was issued in 2007. 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 Government Code chapter 659 provisions and the Comptroller's administrative rules cited here may have changed since 2007. Confirm current law before relying on this analysis.

Who this opinion affected (as of 2007)

State and local charitable campaign managers: The opinion told them the 10 percent fee cap is calculated against total statewide contributions, not area by area, so a local manager's higher-than-10-percent local expenses could still be covered if the combined statewide fee stayed under the cap.

Participating charities and the state policy committee: The opinion confirmed the cap is a statewide-aggregate limit and that the only route above 10 percent was state policy committee approval for reasonable documented costs.

Common questions

Is the campaign manager's fee capped per local area or statewide?
Statewide. The Attorney General concluded the section 659.148(c) calculation is based on the aggregate amount of contributions collected across the entire statewide campaign, not on each local campaign area's collections.

What is the fee based on?
The combined expenses of the state campaign manager and each local campaign manager, charged to charities in proportion to each charity's share of total contributions, and capped at 10 percent of the total statewide amount collected.

Can the 10 percent cap ever be exceeded?
Yes, but only if the state policy committee approves a higher amount to accommodate reasonable documented costs.

Background and statutory framework

Chapter 659, subchapter I of the Government Code requires a state employee charitable campaign each autumn and lets state employees voluntarily authorize paycheck deductions to support charities (Tex. Gov't Code Ann. §§ 659.132, 659.133, 659.138 (Vernon 2004)). The campaign is statewide but conducted locally, with local campaign areas, a state campaign manager, and a local campaign committee that appoints a local campaign manager (Tex. Gov't Code Ann. §§ 659.140(e), 659.143 (Vernon 2004)).

Section 659.148 governs the fee. Subsection (b) lets a campaign manager charge a reasonable and necessary fee for actual expenses to participating charities in the same proportion that contributions to that charity bear to the total of contributions in the campaign. Subsection (c) requires the fee to be based on the combined expenses of the state and local campaign managers and bars it from exceeding 10 percent of the total amount collected, unless the state policy committee approves a higher amount for reasonable documented costs (Tex. Gov't Code Ann. § 659.148(b)-(c) (Vernon 2004)). Construing the statute to give effect to legislative intent by its plain language (Liberty Mut. Ins. Co. v. Garrison Contractors, Inc., 966 S.W.2d 482, 484 (Tex. 1998)), the Attorney General concluded the cap is measured against the aggregate statewide contributions; the Comptroller's rules likewise use "combined expenses" and "total combined fee" language (34 Tex. Admin. Code §§ 326.1, 327.1 (2007)).

Citations

Statutes and rules:

• Tex. Gov't Code Ann. ch. 659, subch. I
• Tex. Gov't Code Ann. § 659.132 (Vernon 2004)
• Tex. Gov't Code Ann. § 659.133 (Vernon 2004)
• Tex. Gov't Code Ann. § 659.138 (Vernon 2004)
• Tex. Gov't Code Ann. § 659.140(e) (Vernon 2004)
• Tex. Gov't Code Ann. § 659.143 (Vernon 2004)
• Tex. Gov't Code Ann. § 659.148(b)-(c) (Vernon 2004)
• 34 Tex. Admin. Code §§ 326.1, 327.1 (2007)

Cases:

• Liberty Mut. Ins. Co. v. Garrison Contractors, Inc., 966 S.W.2d 482, 484 (Tex. 1998)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/greg-abbott/ga-0565
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/2007/ga0565.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain - the linked PDF is authoritative.

ATTORNEY GENERAL OF TEXAS

GREG ABBOTT

August 24, 2007

The Honorable Patrick M. Rose
Chair, Committee on Human Services
Texas House of Representatives
Post Office Box 2910
Austin, Texas 78768-2910

Opinion No. GA-0565

Re: Proper calculation of the fee that a campaign manager may charge to a charitable organization for services rendered in connection with the state employee charitable campaign (RQ-0574-GA)

Dear Representative Rose:

You ask about the proper calculation of the fee that a campaign manager may charge to a charitable organization for services rendered in connection with the state employee charitable campaign.[1]

Chapter 659, subchapter I of the Government Code requires that a state employee charitable campaign be conducted annually. See TEX. GOV'T CODE ANN. § 659.138 (Vernon 2004) ("A state employee charitable campaign shall be conducted each autumn."). The program permits state employees, on a voluntary basis, to authorize paycheck deductions to support charitable organizations. See id. §§ 659.132 (authorizing voluntary deductions), .133 (participation by state employee is voluntary). Although the campaign is statewide, it is conducted on a local level in each of several local campaign areas. See id. § 659.140(e) (providing for local campaign areas and a state campaign manager). Each local campaign is conducted by the local state employee charitable campaign committee, which appoints a local campaign manager. See id. § 659.143. Your question relates to the fees that a local campaign manager may charge to a participating eligible charitable organization. See Request Letter, supra note 1, at 1. The proper calculation of those fees is determined by section 659.148, which provides in part as follows:

(b) A campaign manager may charge a reasonable and necessary fee for actual campaign expenses to the participating charitable organizations in the same proportion that the contributions to that charitable organization bear to the total of contributions in the state employee charitable campaign.

(c) A fee under Subsection (b) must be based on the combined expenses of the state campaign manager and each local campaign manager and may not exceed 10 percent of the total amount collected in the state employee charitable campaign unless the state policy committee approves a higher amount to accommodate reasonable documented costs.

TEX. GOV'T CODE ANN. § 659.148(b)-(c) (Vernon 2004).

Section 659.148 sets out a formula for calculating a campaign manager's "reasonable and necessary fee": the fee charged to a charitable organization must be directly related to the proportion that the "contributions to that charitable organization bear to the total of contributions in the state employee charitable campaign" as a whole. Id. § 659.148(b). Moreover, the fee must be based on the combined expenses of the state and local campaign manager. See id. § 659.148(c). Finally the fee may not exceed ten percent of the total amount collected in the state employee charitable campaign. See id.[2]

You ask, in effect, whether subsection (c) provides that each local campaign manager is limited to a ten percent fee of the total amount of contributions collected for his particular area, or whether the combined fees of the state campaign manager and all local campaign managers are limited to ten percent of the total amount of contributions collected in the aggregate state employee charitable campaign. See Request Letter, supra note 1, at 1.

Like the courts, this office must construe a statute so as to give effect to the Legislature's intent. See Liberty Mut. Ins. Co. v. Garrison Contractors, Inc., 966 S.W.2d 482, 484 (Tex. 1998). To accomplish that purpose, we begin by looking at the plain and common meaning of the statute's text. See id. According to the language of subsection 659.148(c), the fee calculation must be based on the aggregate amount of contributions collected in the entire statewide campaign. Subsection (b) speaks in terms of "the total of contributions." TEX. GOV'T CODE ANN. § 659.148(b) (Vernon 2004). Subsection (c) refers to "combined expenses of the state campaign manager and each local campaign manager," and to "10 percent of the total amount collected."[3] Id. § 659.148(c) (emphasis added). If, for example, one local campaign manager's expenses exceed ten percent of the contributions collected for his area, he may still be eligible to collect the full amount of his expenditures, provided the combined expenses of the statewide campaign manager and the local campaign managers do not exceed ten percent of the total statewide contributions.

We conclude that the proper calculation of the fee described by section 659.148(c), Government Code, must be based upon the aggregate amount of contributions collected on a statewide basis.

SUMMARY

The proper calculation of the fee described by section 659.148(c), Government Code, must be based upon the aggregate amount of contributions collected on a statewide basis.

Very truly yours,

GREG ABBOTT
Attorney General of Texas

KENT C. SULLIVAN
First Assistant Attorney General

NANCY S. FULLER
Chair, Opinion Committee

Rick Gilpin
Assistant Attorney General, Opinion Committee

Footnotes

[1] See Letter from Honorable Patrick M. Rose, Chair, Committee on Human Services, Texas House of Representatives, to Honorable Greg Abbott, Attorney General of Texas (Feb. 26, 2007) (on file with the Opinion Committee, also available at http://www.oag.state.tx.us) [hereinafter Request Letter].

[2] The fee may exceed ten percent if "the state policy committee approves a higher amount to accommodate reasonable documented costs." TEX. GOV'T CODE ANN. § 659.148(c) (Vernon 2004).

[3] The Comptroller's rules also use the terms "combined expenses" and "total combined fee." See 34 TEX. ADMIN. CODE §§ 326.1, 327.1 (2007) (concerning ten percent cap).