Georgia Department of Law, from the office of Samuel S. Olens, Attorney General

Unofficial Opinion 2014-3

October 6, 2014
To: 

State Senator

Re: 

Political subdivisions may establish payroll deduction programs for public employees provided that there is statutory authority to do so and that the programs are not unconstitutional gratuities.

You have requested my opinion as to the standards that would be applicable in evaluating the propriety of payroll deduction programs established by local political subdivisions within the State to permit the purchase by public employees of a variety of items, which might include personal electronics, furniture or educational classes.[1]  It is my unofficial opinion that such payroll deductions may be permissible provided that there is statutory authority to do so and that the programs are not unconstitutional gratuities.

As recognized in your letter, general state law provides a number of instances permitting the use of payroll deductions for state employees.  These include, for example, payroll deductions for the purchase of United States savings bonds (O.C.G.A. § 45‑7‑50), optional life insurance programs established by individual agencies (O.C.G.A. § 45‑7‑51), payments to department or agency credit unions (O.C.G.A. § 45‑7‑52), parking and van pool fees (O.C.G.A. § 45‑7‑53), voluntary contributions to “not for profit organizations, associations, or corporations providing tangible services and benefits to state government or its employees” (O.C.G.A. § 45‑7‑54)[2], transit passes and fare media (O.C.G.A. § 45‑7‑55), personal computing and computer related equipment through programs facilitated by the Georgia Technology Authority (GTA) (O.C.G.A. § 45‑7‑56), savings trust accounts as defined under the Georgia Higher Education Savings Plan[3], retirement contributions (O.C.G.A. § 47‑6‑60), contributions to deferred compensation plans (O.C.G.A. § 45‑18‑36), payments for flexible employee benefit plans (O.C.G.A. § 45‑18‑53), and contributions to defined compensation plans (O.C.G.A. § 47‑22‑8).

While most of these authorized programs are directed towards payroll deductions only for state employees, there are some exceptions.  Municipalities, counties and other political subdivisions are permitted to establish payroll deduction plans for the purchase of savings bonds under O.C.G.A. § 45‑7‑50.  Additionally, payroll deductions for purchasing personal computing and computer related equipment facilitated through the GTA are also authorized for “local units of administration” within the State, meaning “any county or independent board of education.”  O.C.G.A. § 45‑7‑56(a) and (c).  “Instrumentalities of the state” are authorized to establish deduction programs for Higher Education Savings Plans.  O.C.G.A. § 45‑7‑57(a).  The Firefighters’ Pension Fund and local school systems are authorized to provide for deductions to purchase insurance under flexible employee benefit plans.  O.C.G.A. § 45‑18‑53(a).  Local political subdivisions such as cities or counties are permitted to participate in deferred compensation plans administered by the state Employees’ Retirement System, including paying for the cost of any employee payroll deduction plans.  O.C.G.A. § 45‑18‑35.

Each of the authorizing statutes generally establishes criteria outlining how the payroll deduction programs must operate, including defining the employees who may be authorized to participate and the threshold levels of employee participation which may be required.  While the various statutes may have differing specific criteria under which they operate, they also have a number of similarities, such as requiring written authorizations from the participating employees and the agencies involved.  Any liability on the part of the deducting agency or department regarding the deduction program is generally disclaimed and, for contributions by state employees to certain nonprofit organizations which are “providing tangible services and benefits to state government or its employees,” pursuant to O.C.G.A. § 45‑7‑54(f) the deducting agency must collect an administration fee from the deductions, not to exceed one percent (1%) of the total deduction collected.

This office has also repeatedly acknowledged all such payroll deduction plans must be authorized by statute and the deduction cannot be a gratuity in violation of the state constitution.  See 1996 Op. Att’y Gen. U96‑11, citing Ga. Const. Art. III, Sec. VI, Para. VI; 1982 Op. Att’y Gen. 82‑79 (deductions for voluntary charitable contributions permitted); 1976 Op. Att’y Gen. 76‑119 (deductions for union dues not authorized); 1976 Op. Att’y Gen. 76‑114 (deductions for parking fees not authorized); 1974 Op. Att’y Gen. U74‑62 (deductions for charitable organizations not authorized.)  As held by the Supreme Court of Georgia:

The Georgia Constitution prohibits the General Assembly from granting any donation or gratuity.  This court has adopted the ordinary definition of "gratuity" as "something given freely or without recompense; a gift."  Thus, there is no gratuity when the state receives substantial benefits in exchange for the use of public property.

Garden Club of Georgia, Inc. v. Shackelford, 266 Ga. 64 (1995) (footnotes omitted) (emphasis added); 1996 Op. Att’y Gen. U96-11 n.1.  In interpreting what a “substantial benefit” may be, this office has previously concluded that where there are tangible services and benefits to the state or its employees as shown through the meeting of statutory standards and the payment of an administration fee, then a payroll deduction program is clearly not a gratuity.  See 1996 Op. Att’y Gen. U96-11; 1982 Op. Att’y Gen. 82‑79.  See also Garden Club of Georgia v. Shackelford, 272 Ga. 653, 654 n.4 (2002); Smith v. Bd. of Comm’rs of Rds. & Revenues, 244 Ga. 133, 140-41 (1979).

These same standards would apply to payroll deduction plans implemented by local political subdivisions.  A city, county, school district or other political subdivision may only act in accordance with the powers provided to it through the state constitution or by statute.  See, e.g., Bd. of Comm’rs v. Callan, 290 Ga. 327, 328-29 (2012) (counties and their officers may act only in accordance with an express grant of power or one necessarily implied by an express power), citing Channell v. Houston, 287 Ga. 682, 683 (2010); Krieger v. Bd. of Comm’rs, 269 Ga. 678, 679 (1998); Stephenson v. Bd. of Comm’rs, 261 Ga. 399, 400 (1991).  Therefore, there must be a specific grant of authority to local governments to permit such programs.

Furthermore, the constitutional restriction against the granting of gratuities applies to local political subdivisions.  See Smith v. Bd. of Comm’rs, 244 Ga. at 140‑41; Swannberger v. Tybee Island, 271 Ga. 23, 26 (1999); Kennedy v. State, 205 Ga. App. 152, 153 (1992); 2004 Op. Att’y Gen. 2004‑3 (acknowledging the application of the Garden Club standard to cities and counties); 2002 Op. Att’y Gen. U2002‑8 (hospital authorities subject to the gratuities prohibition); 1998 Op. Att’y Gen. 98‑10 (county development authority subject to the gratuities clause); 1998 Op. Att’y Gen. U98‑14 (school system suggestion program was not an unconstitutional gratuity); 1995 Op. Att’y Gen. U95‑12 (city and county recreation department subject to the gratuities clause); 1986 Op. Att’y Gen. 86‑28 (county development authority subject to the prohibition against gratuities).  This means that any local payroll deduction program would also need to provide a tangible service or substantial benefit to the political subdivision.

It also appears that the authority to implement such a plan for a local political subdivision would need to come from the General Assembly itself through the enactment of general laws.  As noted above, the legislature has already enacted a number of specific authorizing provisions for payroll deduction plans, only some of which apply to differing types of local political subdivisions.

Pursuant to the principle of statutory construction, “Expressum facit cessare tacitum” (if some things are expressly mentioned, the inference is stronger that those omitted were intended to be excluded) and its companion, the venerable principle, “Expressio unius est exclusio alterius” (“The express mention of one thing implies the exclusion of another”), the list of actions [in a statute] is presumed to exclude actions not specifically listed . . . and the omission of [a provision] is regarded by the courts as deliberate.

Alexander Properties Group v. Doe, 280 Ga. 306, 309 (2006) (internal citations omitted); 2010 Op. Att’y Gen. 2010-3.  Applying these principles, it appears the General Assembly, by acting in this area through various general statutory provisions, intended to permit local governments to utilize payroll deduction plans only in limited circumstances as outlined in those kinds of general laws.

Finally, there is no general law authorizing local governments to undertake payroll deduction programs either through the passage of local law or through local ordinances.  See Ga. Const. Art. III, Sec. VI, Para. IV(a) (“Laws of a general nature shall have uniform operation throughout this state and no local or special law shall be enacted in any case for which provision has been made by an existing general law, except that the General Assembly may by general law authorize local governments by local ordinance or resolution to exercise police powers which do not conflict with general laws.”), Franklin County v. Fieldale Farms Corp., 270 Ga. 272, 274 (1998); 2014 Op. Att’y Gen. 2014‑1.  See also Callan, 290 Ga. at 328-29, citing Ga. Const. Art. IX, Sec. II, Para. I(a) (“The governing authority of each county shall have legislative power to adopt clearly reasonable ordinances, resolutions, or regulations relating to its property, affairs, and local government for which no provision has been made by general law and which is not inconsistent with this Constitution or any local law applicable thereto.”)  Absent authority to engage in such programs through the enactment of local laws, then it seems the most appropriate method for their implementation would be through the passage of general laws.

Therefore, it is my unofficial opinion that generally payroll deductions programs instituted by local political subdivisions may be permissible provided that there is statutory authority to do so and that the programs are not unconstitutional gratuities.

Prepared by:

DENNIS R. DUNN

Deputy Attorney General


[1] There is no specific proposal or program described in your request.  This opinion makes no determination regarding whether any current or future payroll deduction programs meet these standards.

[2] Specifically, O.C.G.A. § 45‑7‑54(a) provides, “Where 2,500 or more full-time employees of the state request payroll deduction services to any not for profit organization, association, or corporation having among its objectives educational, legislative, or professional development activities related to promoting and enhancing the efficiency, productivity, and welfare of state government services or of state government employees, then the state shall provide such deductions as an additional employment benefit to its employees.”

[3] See O.C.G.A. §§ 20‑3‑630 through 20‑3‑642.