February 03, 1993
Official Opinion 93-4
- To
The Adjutant General
Georgia Department of Defense
- Re
Funds collected by the Department of Defense (DOD) as billeting funds or armory rentals are state funds which may be retained by DOD but their management is subject to requirements of the Office of Planning and Budget, the State Auditor and the State Depository Board; housekeeping personnel who are paid with any of such funds pursuant to DOD regulations are state employees.
This letter responds to your request for advice as to the management and proper use of funds collected as rent for use of armories and for billeting at the National Guard Training Center (NGTC) and the Georgia Military Institute (GMI). In addition, you have asked for advice regarding the status of employees paid from billet funds to perform housekeeping activities. My discussion is organized around the specific questions you raised.
(1) Are billet and armory rental collections made by DOD state funds and, if so, is there a requirement [*2] that the funds be audited by a state agency other than DOD?
O.C.G.A. § 38-2-195(b) authorizes the use of "armories and other facilities" in accordance with regulations issued by DOD. DOD has issued regulations which impose billeting fees and rentals for armory use. Georgia National Guard Regulation (GaNGR) 210-1, -3 and -52.
Therefore, with respect to your first question, funds collected as billeting fees or armory rentals are "state funds" in the sense that they are public funds collected by a state agency and are owned by the State.
The Department of Audits and Accounts shall audit all state institutions. No official of the state shall have authority to employ or hire any other auditing agency.
O.C.G.A. § 50-6-3.
The Auditor's authority extends to all books, records, accounts, and other papers dealing with or reflecting upon the financial transactions and management of state agencies, including any and all cash on hand. O.C.G.A. § 50-6-7. The billet funds and armory rental funds are within the authority of the State Auditor and must be audited by him.
(2) Does the State have regulations concerning the management of state funds and, if so, are the procedures in [*3] GaNGR 210-3 consistent with state regulations?
The first issue in this area is whether DOD may retain the billet fees and armory rentals or must deposit them into the state treasury. The Georgia Constitution requires that "all revenues collected from taxes, fees, and assessments for state purposes, as authorized by revenue measures enacted by the General Assembly, shall be paid into the general fund of the state treasury." Ga. Const. 1983, Art. VII, Sec. III, Par. II. This requirement is intended with other provisions of the Constitution to prevent the "earmarking" of funds in favor of particular state agencies. See Op. Att'y Gen. 77-77. However, certain exceptions have been identified. In pertinent part, there is an exception for funds which are collected pursuant to a general authority to conduct an activity or program rather than a specific statutory premise mandating their collection. Id.
In the case of the billet fees and armory rentals, DOD collects the funds pursuant to regulations issued under Code Section 38-2-195(b): "The use of armories and other facilities shall be in accordance with regulations issued pursuant to this part." Therefore, as was the case [*4] with the Departments of Corrections and Human Resources, whose imposition of room and board charges was under review in the 1977 opinion, DOD has "general statutory authority to establish programs and regulate its own affairs, which is sufficient to support imposition of the charges" but does not command their collection. Op. Att'y Gen. 77-77 at 143.
O.C.G.A. § 38-2-192 provides:
The equipping and maintenance of facilities (of DOD) shall be from funds appropriated . . . by the state, the United States, the counties and municipalities . . . and, in the case of armories, from funds derived from rentals as set forth in Code Section 38-2-195. (Matter in brackets added.)
As discussed above, O.C.G.A. § 38-2-195 is not an express measure for collecting revenues as contemplated in the Constitution and applied in Op. Att'y Gen. 77-77 but is a general power to provide for use of the armories by regulation. Therefore, the power given by O.C.G.A. § 38-2-192 to retain rental funds and apply them to equipping and maintaining armories is consistent with the result in Op. Att'y Gen 77-77.
The retained funds must be processed and accounted for in accord with requirements of other agencies. [*5] The State Auditor is authorized to "promulgate forms and records for the collecting and paying out of all moneys . . . of the state. . . ." O.C.G.A. § 50-6-24(1). Under the Budget Act the Governor, through the Office of Planning and Budget (OPB), has the supervision of every agency in order to obtain uniform and accurate accounts and efficient conduct of fiscal affairs. O.C.G.A. § 45-12-72(b). OPB is also authorized to coordinate the State's fiscal affairs and procedures, "including the administration of a system of expenditure control." O.C.G.A. § 45-12-73(2). Under these provisions of law, you must comply with Audit and OPB requirements for record keeping and must amend your budget to reflect the "agency funds" retained from the billet fees and armory rentals. Specific requirements should be coordinated with the respective agencies.
In addition, the State Depository Board governs the deposits of funds owned by the State. O.C.G.A. §§ 50-17-50, et seq. In part, O.C.G.A. § 50-17-63 requires:
All demand funds held by any department, board, bureau, or other agency of the state shall be deposited in state depositories; and such funds that are in excess of requirements [*6] for current operating expenses shall be placed under time deposit agreements by the director conforming to interest contracts then having approval of the board. . . .
You should be certain that your regulations and practices are consistent with the policies and regulations of OPB, the State Auditor and the State Depository Board.
(3) Are housekeeping personnel who are paid with receipts from billeting collections state employees?
Finally, in response to your third question, housekeeping personnel who are paid out of billet funds are state employees and entitled to benefits as employees unless exempted by the State Merit System law. Ops. Att'y Gen. 74-27, 69-6. That law does not exempt local employees of DOD or units thereof from its application. Under the Merit System Law, State employees are in either the "classified service" or the "unclassified service." O.C.G.A. § 45-20-6(a) states that "the classified service . . . shall consist of all positions now existing or hereafter established in the state departments except those included by law in the unclassified service." The "classified service" expressly includes "local employees of the Department of Defense as defined by [*7] law." O.C.G.A. § 45-20-2(2). "Department," in turn, is defined to include "units of the Department of Defense with local employees." O.C.G.A. § 45-20-2(7). The definition of "unclassified service" contains no suggestion that the positions in question are possibly unclassified. O.C.G.A. § 45-20-2(15). Given the express reference to the inclusion of "local employees of the Department of Defense" in the classified service and the specific inclusion of local employees of units of the Department of Defense under the Merit System law, it is clear that the General Assembly intended local employees of DOD to serve in the classified service.
The fact that housekeeping personnel have been considered employees of the billet funds does not affect their status as state employees. A person's status as a state employee depends upon whether the State determines the time, place, and manner of work performance. In Op. Att'y Gen. 69-6, the Attorney General opined that persons who were retained by DOD and paid with federal funds were, nevertheless, state employees where it appeared that the DOD determined the time, place, and manner of performance. There is no question here that the State exercises [*8] control over the performance of work by the housekeeping personnel.
Therefore, it is my official opinion that funds collected by DOD as billeting funds or armory rentals pursuant to regulations issued under O.C.G.A. § 38-2-195 are state funds which may be retained by DOD. The management of the funds is subject to requirements of the Office of Planning and Budget, the State Auditor and the State Depository Board. Housekeeping personnel who are paid with such funds pursuant to regulations are state employees. As state employees, housekeeping personnel are entitled to the benefits authorized under the State Merit System and other laws upon compliance with the terms of participation.
Prepared by:
JOHN B. BALLARD, JR
Senior Assistant Attorney General