Michigan Advisory Opinions September 10, 1979: AGO 5558 (September 10, 1979)

Michigan Attorney General Opinions

1979.

AGO 5558.

You have asked for my opinion on the following questions arising from the voter approval of Proposal M on November 7, 1978, amending Const 1963, Article 9, Sec. 9:

1. What are the parameters within which the portion of such revenues reserved for road programs can be spent?

2. Would transfers, loans, or advances for other than road programs from the funds restricted for road programs be constitutional?

3. The portion of revenues restricted for comprehensive transportation is to be used for 'comprehensive transportation purposes as defined by law.' In defining such purposes, what limits are there on Legislative definiton of such a term?

4. Could the Legislation define any government program to be a comprehensive transportation purpose, or is any further definition restricted to the general area of transportation of people, goods, or services?

In answer to the first question, attention must be first directed to Const 1963, Article 9, Sec. 9, as amended, which provides in pertinent part that:

'Not less than 90% of the specific taxes, except general sales and use taxes and regulatory fees, imposed directly or indirectly on fuels sold or used to propel motor vehicles upon highways and on registered motor vehicles shall, after the payment of necessary collection expenses, be used exclusively for the transportation purposes of planning, administering, constructing, reconstructing, financing and maintaining state, county, city, and village roads, streets, and bridges designed primarily for the use of motor vehicles using tires, and reasonable appurtenances to those state, county, city, and village roads, streets, and bridges.' (emphasis added)

The language of the Constitution has established the parameters within which revenues reserved for road programs may be spent as being the planning, administering, constructing, reconstructing, financing, and maintaining of state, county, city, and village roads, streets, and bridges and their appurtenances.

Prior to the adoption of Proposal M, supra, the parallel provision of the Constitution stated:

'All specific taxes, except general sales and use taxes and regulatory fees, imposed directly or indirectly on fuels sold or used to propel motor vehicles upon highways and on registered motor vehicles, shall, after the payment of necessary collection expenses, be used exclusively for highway purposes as defined by law.' (emphasis added)

The omission of the phrase 'as defined by law' in the newly-adopted constitutional provision and the explicit recitation of six transportation purposes compels the conclusion that the revenue reserved for transportation in the current provisions of Const 1963, Art 9, Sec. 9, shall be used for these purposes and none other.

Your second question inquires whether transfers, loans, or advances for other than road programs from funds restricted for road programs would be constitutional?

By referring to funds restricted for road programs, I presume you are referring to a provision of Const 1963, Article 9, Sec. 9, supra, which provides for funds to '. . . be used exclusively for the transportation purpose of planning, administering, constructing, reconstructing, financing, and maintaining state, county, city, and village roads, streets, and bridges designed primarily for the use of motor vehicles using tires . . .' (emphasis added)

81A C.J.S. States Sec. 228, pp. 799-800 (1977), speaks to the issue of transfer or diversion of special funds to other purposes:

'Disposition of special funds. Where a special fund is created or set aside by statute for a particular purpose or use, it must be administered and expended in accordance with the statute, and may be applied only to the purpose for which it was created or set aside, and not diverted to any other purpose, or transferred from such authorized fund to any other fund.'

The court, in Michigan Sheriffs' Association v Department of Treasury, 75 Mich App 516, 528; 255 NW2d 666, 671 (1977), recognized that executive transfers of special funds to other purposes is generally prohibited, while a legislative type transfer '. . . is within the power of the Legislature unless such diversion would conflict with a constitutional provision . . .' (emphasis added)

As an example, in footnote 10 of the opinion, the court said that:

'. . . no part of the gasoline tax on fuels used to propel motor vehicles on highways could be diverted to the construction of marinas or launching facilities. Const 1963, Article 9, Sec. 9 . . ..'

By allowing a transfer, diversion, or final appropriation of road program funds to programs other than road programs, the executive or legislative branches of the government would be acting in direct contravention of the Constitution, since Article 9, Sec. 9, provides for the purposes for which the funds shall be exclusively used.

Therefore, answering your second question, in order to avoid a direct conflict with a constitutional provision, there may not be any transfer, loan, diversion, or appropriation of those funds designated for use in road programs to some other use not contemplated by the Constitution. I am aware that OAG 1951-1952 No. 1451, p 326 (August 1, 1951) considered the question of whether it was proper to loan gasoline and weight tax funds for the purchase of parking meters. In that opinion the Attorney General held that a temporary loan from one fund to another was permissible. In light of the current language of Const 1963, Art 9, Sec. 9, this opinion is no longer viable.

Your third and fourth questions may be considered together. The third paragraph of Const 1963, Art 9, Sec. 9, as amended, provides in pertinent part:

'The balance, if any, (fn1) of the specific taxes, except general sales and use taxes and regulatory fees, imposed directly or indirectly on fuels sold or used to propel motor vehicles upon highways and on registered motor vehicles, after the payment of necessary collection expenses; 100 percent of the specific taxes, except general sales and use taxes and regulatory fees, imposed directly or indirectly on fuels sold or used to propel aircraft and on registered aircraft, after the payment of necessary collection expenses; and not more than 25 percent of the general sales taxes, imposed directly or indirectly on fuels sold to propel motor vehicles upon highways, on the sale of motor vehicles, and on the sale of the parts and accessories of motor vehicles, after the payment of necessary collection expenses: shall be used exclusively for the transportation purposes of comprehensive transportation purposes as defined by law.' (emphasis added)

The above-quoted section of the Constitution provides that 'comprehensive transportation purposes' shall be defined by law. The phrase 'as defined by law' was included in Proposal M rather than including a specific definition of 'comprehensive transportation purposes'. By including 'as defined by law' in Proposal M, the Legislature was given the power to define and limit the meaning of the term 'comprehensive transportation purposes'.

Although the Legislature has discretion in defining and limiting the meaning of the term 'comprehensive transportation purposes', however, in exercising its discretion, the Legislature must define the term to mean 'that which will carry out the purpose of the context in which it is used'. (fn2) Therefore, the Legislature may not provide for a use of the fund for other than a transportation purpose.

It is my opinion therefore, that the Legislature may not define any governmental program to be a comprehensive transportation purpose; it must define the term in light of the purpose sought to be accomplished by the constitutional provision.

Frank J. Kelley

Attorney General

1. Inasmuch as the second paragraph of Const 1963, Art 9, Sec. 9, designates '[n]ot less than 90% of the specific taxes' to be used exclusively for specific transportation purposes, the reference to 'The balance, if any' indicates that no more than 10% may be allocated for 'comprehensive transportation purposes as defined by law.' Thus, for example, the Legislature may use 92% of these taxes for defined transportation purposes leaving 8% for comprehensive transportation purposes.

2. Huron-Clinton Metropolitan Authority v Boards of Supervisors of Five Counties, 300 Mich 1, 21; 1 NW2d 430, 437 (1942).