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AGO Opinion 97042

Approval by the Governor of Assessments for the Nebraska Power Review Fund in Light of Existing Legislative Appropriations and Neb. Rev. Stat. §70-1020 (1996)
Opinion 97042

DATE: August 20, 1997

SUBJECT: Approval by the Governor of Assessments for the Nebraska Power Review Fund in Light of Existing Legislative Appropriations and Neb. Rev. Stat. §70-1020 (1996)

REQUESTED BY: Gary D. Gustafson, Executive Director

Nebraska Power Review Board

WRITTEN BY: Don Stenberg, Attorney General

Dale A. Comer, Assistant Attorney General




During the 1997 legislative session, the Nebraska Legislature

appropriated certain amounts from the Nebraska Power Review Fund

for the operation of the Nebraska Power Review Board (the "Board").

The monies in that fund are derived from an annual assessment

levied against certain Nebraska governmental subdivisions, and the

amount of the assessment levied each fiscal year is determined by

the Board with the approval of the Governor. The Governor has now

indicated that he will not approve an increased assessment proposed

by the Board which is needed to totally fund the amounts

appropriated by the Legislature during its 1997 session. You wish

to know, "[d]oes the Governor have the authority to restrict the

Power Review Board from assessing power suppliers of Nebraska for

the funds to meet the appropriation granted to the Power Review

Board by the Legislature?" We believe that the Governor does have

such authority, and our analysis is set out below.


FACTS




From your opinion request letter, we understand that the Board

prepared a budget of $166,493 for fiscal year 1997-1998, and

proposed that figure to the Governor for inclusion in the budget

which he is required to submit to the Legislature as a part of the

biennial state budgeting process. In the budget which he

subsequently presented to the Legislature for fiscal year 1997-

1998, however, the Governor reduced the amount of the Board's

appropriation to $155,778. Thereafter, the Appropriations

Committee of the Legislature prepared a budget bill which included

$169,320 for the Board for fiscal year 1997-1998.




As the 1997 legislative process proceeded, it was discovered

that the Board's reserve fund did not contain sufficient monies to

meet the Board's obligations to its Executive Director and his

Administrative Assistant for accumulated sick leave and vacation

time should either of those individuals take early retirement or

die while still employed by the state. Therefore, the Board

submitted an amended budget to the Governor and the Appropriations

Committee which included an additional $30,000 to cover the

potential shortfall. In response, the Appropriations Committee

prepared an amended budget bill which included monies for the

potential shortfall and monies for increases in staff salaries.

Ultimately, the Legislature passed LB 389 and LB 387 which

appropriated a total of $199,320 to the Board for fiscal year 1997-

1998.




After that appropriation legislation was passed, the Governor

vetoed the amount of the budget for the Board set out in LB 387 and

LB 389 for fiscal year 1997-1998. The Legislature then passed

overrides of the Governor's vetoes so that 1997 Neb. Laws LB 387,

§ 150 and 1997 Neb. Laws LB 389, § 222 currently appropriate a

total of $199,320 to the Board for fiscal year 1997-1998.




As noted above, the Board's program is funded through

assessments levied against governmental subdivisions in the State

of Nebraska. The Governor has apparently sent a memo to all state

agencies, boards, and commissions telling them that he will not

approve any increase in fees or charges that would lead to an

increased spending authority. In addition, the Governor has

notified the Board that he does not intend to approve assessments

by the Board necessary to fund the total appropriation granted to

the Board by the Legislature. Consequently, you wish to know if

the Governor has the authority in this instance to restrict the

levy of assessments by the Board necessary to totally fund its

appropriation for 1997-1998.




ANALYSIS




Neb. Rev. Stat. § 70-1020 (1996) is the Nebraska statute which

pertains directly to the question which you have posed to us. That

section provides, as is pertinent:




In order to defray the expenses of the Nebraska Power

Review Board, there shall be imposed upon each public

power district, public power and irrigation district,

electric membership association, electric cooperative

company, and municipality having an electric distribution

system or generation and distribution system, and also

upon all registered groups of municipalities, an

assessment each fiscal year in such sum as shall be

determined by the board and approved by the Governor.

The total of such assessments shall not exceed the

expenses of the board which may reasonably be anticipated

for the fiscal year for which assessment is made and

shall be apportioned among the various agencies in

proportion to their gross income in the preceding

calendar year. The board shall determine and certify

such assessment to each supplier after approval of the

board's budget by the Legislature and Governor. The

supplier shall remit the amount of its assessment to the

board within forty-five days after the mailing of the

assessment. . . . The proceeds of such assessment

shall be remitted to the State Treasurer for credit to

the Nebraska Power Review Fund, which fund is hereby

created and which, when appropriated by the Legislature,

shall be used to administer the powers granted to the

Nebraska Power Review Board. . . .




(Emphasis added).




LB 389, as ultimately passed by the Legislature over the

Governor's veto, appropriates $196,548 out of a "cash fund" to the

Board for fiscal year 1997-1998. Similarly, LB 387 appropriates

$2,772 to the Board out of a "cash fund." Under the Nebraska

Accounting System manual, a "cash fund" is defined as "[a]

budgetary fund used to account for revenues generated by specific

activities from sources outside of State government (other than

federal) and the expenditures directly related to the generation of

the revenues." Since § 70-1020 creates the Nebraska Power Review

Fund which is funded by assessments against power suppliers outside

of state government and used to administer the powers granted to

the Board, it appears to us that the "cash fund" referenced in both

LB 387 and LB 389 is the Nebraska Power Review Fund. As a result,

the appropriations to the Board for 1997-1998 do not come out of

the state's General Fund, which is the fund made up primarily of

tax revenues used for general state operations at the direction of

the Legislature. Instead, the appropriations in LB 387 and LB 389

are authorizations to pay money out of the Nebraska Power Review

Fund, a cash fund subject to specific statutory provisions

regarding the levy of assessments for accumulation of the fund's

proceeds.




The initial portion of § 70-1020 emphasized above states that

the amount of the annual assessments against power districts which

form the basis for the Nebraska Power Review Fund shall be

"determined by the Board and approved by the Governor." In

Nebraska, in the absence of anything indicating to the contrary,

statutory language should be given its plain and ordinary meaning,

and when the words of a statute are plain and unambiguous, no

interpretation is necessary to ascertain its meaning. Van Ackeren

v. Nebraska State Board of Parole, 251 Neb. 477, 558 N.W.2d 48

(1997). It seems to us that the plain language of § 70-1020

contemplates that the Governor must "approve" the amount of the

annual assessment levied by the Board. "Approve," in turn,

generally means "to give one's consent to." WEBSTER'S NEW WORLD

DICTIONARY 68 (2nd college ed. 1982). Consequently, we believe

that the Governor must consent to the amount of the annual

assessment levied by the Board under the plain language of § 70-

1020.




In your opinion request letter, however, you ask, "[i]sn't the

Legislature's override of the Governor's veto the final action

which authorizes the Power Review Board to assess and collect and

expend the budget authorized by the Legislature [?]" Our answer to

that question is "no," based upon the nature of an "appropriation."




With respect to the appropriation of public funds, "to

appropriate" means to set particular funds apart, or to assign

funds to a particular person or use to the exclusion of others, or

to use funds for a particular purpose. State ex rel. Creighton

University v. Smith, 217 Neb. 682, 353 N.W.2d 267 (1984). The

purpose of an appropriation bill is to make provision for lawfully

taking money out of the state treasury. Henry v. Rockey, 246 Neb.

398, 518 N.W.2d 658 (1994); Rein v. Johnson, 149 Neb. 67, 30 N.W.2d

548 (1947). That purpose is to be distinguished from lawfully

putting money into the state treasury to be allocated to a

particular fund. Rein v. Johnson, supra.




In the present instance, the Legislature, through the veto

override process, appropriated certain monies from the Nebraska

Power Review Fund to the Board for its operation for fiscal year

1997-1998. That appropriation constituted authorization for

lawfully taking those monies out of that Fund in the state

treasury. However, on the basis of the authority cited above, that

appropriation and the appropriation process must be distinguished

from the process of putting money into the Nebraska Power Review

Fund in the state treasury. The latter process is governed by the

provisions of § 70-1020 which, as discussed above, require the

Governor's approval of the assessments to be levied by the Board.

As a result, while the Legislature authorized the Board to spend

the appropriated amounts from the Nebraska Power Review Fund, the

accumulation of those monies remains subject to the approval of the

Governor under § 70-1020. A different result might well have been

obtained had the Legislature chosen to appropriate General Fund

monies to the Board or to alter the requirements of § 70-1020 in

some fashion.




Sincerely yours,




DON STENBERG

Attorney General




Dale A. Comer

Assistant Attorney General