Response of the Justices of the Supreme Court to Questions Propounded by the Senate as to the Validity of a Proposed Statute.
Questions answered.
Senate Resolution.
S. R. 31. By Mr. Teasley.
Whereas, there is now pending in the Senate, Senate Bill No. 51 which is of great importance to the public school system of Alabama, and the constitutionality of the bill should be beyond question.
Therefore, be it resolved by the Senate that the Justices of the Supreme Court of Alabama, or a majority thereof, are hereby requested to render to this body their written opinion, as provided under section 10290 of the Code of Alabama, as to whether said act violates the following sections of the Constitution of Alabama, viz.:
Section 45, relating to the title.
Section 72, relating to money to be paid out of the treasury.
Section 93, as twice amended, relating to the State's engaging in internal works, or lending money or credit in aid of such.
Section 94, similar to the above.
Sections 106 and 110, relating to special or private laws.
Section 229, relating to special or private corporations created by the Legislature.
Amendments 20A and 1, amending section 93 of the Constitution, relating to the State's engaging in corporate enterprises or lending money and credit.
Section 213, prohibiting the creation of new debts.
Sections 256 and 260, relating to public school funds.
Section 261, relating to payment of teachers.
Section 262, giving supervision to superintendent of education.
Amendment XIX, three mill tax.
The following is a copy of Senate Bill No. 51:
A Bill to be entitled an act to promote, foster, aid and expand the public school system of the State of Alabama; and to this end and for this purpose provide for and authorize an incorporation by the Superintendent of Education of Alabama, the Commissioner of Agriculture and Industries of Alabama, and the Attorney General of Alabama, to be known as the "Alabama Educational Finance Corporation," to aid in financing the construction of school houses and colleges in the State of Alabama, and payment of salaries of teachers and other expenses necessary and incident to the maintenance and expansion of the public school system of the State; to purchase and sell State school warrants and school warrants of the several counties and municipalities of the State; to provide for the raising of necessary funds for such purposes; to provide for the payment of said notes, debentures, bonds or other evidences of indebtedness, and interest thereon, out of any of the funds in the State Treasury heretofore or hereafter appropriated for the maintenance, betterment and expansion of the public school system of the State or out of any special school taxes collected for school districts, counties or municipal corporations of the State; to make appropriation out of the general fund of the State to aid in the purposes of this act.
Be it enacted by the Legislature of Alabama:
Section 1. To promote, foster, aid and expand the public school system of the State of Alabama; and to this end and for this purpose provide for and authorize an incorporation by the Superintendent of Education of Alabama, the Commissioner of Agriculture and Industries of Alabama, and the Attorney General of Alabama, to be known as the "Alabama Educational Finance Corporation," to aid in financing the construction of school houses and colleges in the State of Alabama, and payment of salaries of teachers, and other expenses necessary and incident to the maintenance and expansion of the public school system of the State; to purchase and sell State school warrants and school warrants, of the several counties and municipalities of the State; to provide for the raising of necessary funds for such purposes; to provide for the payment of said notes, debentures, bonds or other evidences of indebtedness, and interest thereon, out of any of the funds in the State Treasury heretofore or hereafter appropriated for the maintenance, betterment and expansion of the public school system of the State or out of any special school taxes collected for school districts, counties or municipal corporations of the State; to make appropriation out of the general fund of the State to aid in the purposes of this act, as follows:
Section 2. Authority to Incorporate. The Superintendent of Education, the Commissioner of Agriculture and Industries and the Attorney General of the State of Alabama may become a corporation to be designated and known as the "Alabama Educational Finance Corporation," with the power and authority hereinafter defined, by proceeding according to the provisions of this act.
Section 3. Proceedings to Incorporate. To become a corporation, the Superintendent of Education, the Commissioner of Agriculture and Industries and the Attorney General of the State of Alabama shall present to the Secretary of State of Alabama an application signed by them, which shall set forth; (a) The name, official designation and official residence of the applicants, together with a certified copy of the commission evidencing their right to office, the date and place of induction into and taking oath of office, and that they desire to become a corporation under this act; (b) The term of office of the applicants; and the place where, if any, the official commission of applicants is kept of records; (c) The name which is proposed for the corporation; (d) The location of the principal office of the proposed corporation, (which shall be Montgomery, Alabama); (e) Any other matter relating to the incorporation which the applicants may choose to insert, not inconsistent with the Constitution and laws of the State of Alabama. The application shall be subscribed and sworn to by each of the applicants before an officer authorized by the laws of the State of Alabama to take and certify oaths, who shall certify upon the application that he personally knows the applicants and believes them to be the officers as asserted in the application, and that they each subscribed and swore thereto in the officer's presence. The Secretary of State shall examine the application and if he finds that the name proposed for the corporation is not identical with that of a person or of any other corporation in this State, or so nearly similar thereto as to lead to confusion and uncertainty, he shall receive and file it and shall record it in an appropriate book of record in his office.
Section 4. Certificate of Incorporation. When the application has been made, filed and recorded, as herein provided, the applicants shall constitute a corporation under the name proposed in the application; the Secretary of State shall make and issue to the applicants a certificate of incorporation, pursuant to this act, under the seal of the State, and shall record the same with the application.
Section 5. Powers of. The corporation under this act shall have the following powers; (a) To have succession by its corporate name for five years from the time of its organization, unless the time be extended by law, and promptly thereafter close its business; but after it has closed its business it shall have corporate capacity to sue and shall be liable to suits until its affairs and liabilities are fully closed. (b) To sue and be sued and defend and to make and use a corporate seal, and to alter the same at pleasure. (c) To acquire, hold, purchase, receive by gift, bequest or devise and to convey or otherwise dispose of all such real estate, personal and mixed property as may be necessary or incident for the purposes of this act; to borrow money, to issue notes, debentures, bonds and other negotiable papers, mortgages, pledge or otherwise transfer or convey its real, personal and mixed property to secure the payment of money borrowed or any debt contracted. (d) To appoint and employ such officers and agents as the business of the corporation may require. (e) To wind up and dissolve its business, or be wound up and dissolved in the manner in this act provided.
Section 6. Powers, Special. The main purpose of the Corporation shall be to promote, foster, aid and expand the public school system of the State of Alabama. For the purpose of providing funds to aid in financing the cost of school houses and colleges already constructed and to aid in the future construction of same, and for the payment of salaries of teachers and other expenses necessary and incident to maintenance and expansion of the public school system of Alabama. The corporation is hereby authorized to borrow money from time to time in such amounts as may be deemed best and as the Governor may approve, and to execute therefor the notes, debentures, bonds and other evidences of indebtedness of the corporation signed by the three members thereof, and attested by the Secretary of State, and to secure said notes, debentures, bonds and other evidences of indebtedness; to pledge any and all of the assets of the corporation which are hereby specifically pledged for the payment and retirement of the notes, debentures, bonds and other evidences of indebtedness, principal and interest as the same become due until the whole of them shall be paid. The notes, debentures, bonds and other evidences of indebtedness herein authorized shall be payable in lawful monies of the United States, and shall be in such form and denomination and be payable at such times and places as the corporation may determine; and shall be free from taxes of all kinds in the State of Alabama. Such notes, debentures, bonds and other evidences of indebtedness shall be negotiated from time to time on the best terms obtainable, at not less than par, and shall bear interest at not to exceed 6% per annum, payable quarterly, semi-annually or annually, as the corporation may determine, and may be renewed from time to time and shall be made to mature at such times and in such amounts as they may be conveniently retired out of the funds specially pledged and designated for their payment, under the provisions of this act.
Section 7. Payment of Indebtedness. All of said notes, debentures, bonds and other evidences of indebtedness shall be paid out of any of the funds in the State Treasury heretofore or hereafter appropriated for the maintenance, betterment and expansion of the public school system of the State or out of any special school taxes collected for school districts, counties or municipal corporations of the State. Provided however, that the payment out of the State Treasury shall be limited to the amount of State School warrants held by the corporation from time to time, and the payment out of the special school taxes collected in the several school districts, counties and municipalities shall be limited to the amount of warrants of the several school districts, counties and municipalities respectively held by the corporation.
Upon the payment of any notes, debentures, bonds or other evidences of indebtedness of the corporation by the State Treasury or by the treasurer of the school funds of the several school districts, counties and municipalities, the corporation shall cancel and surrender a like amount of warrants, respectively, held by it.
The payments herein provided for shall be approved by the Governor and by warrants drawn by the State Auditor on the State Treasury.
Section 8. Deposit of Proceeds. The proceeds of such notes, debentures, bonds or other evidences of indebtedness and all of the funds belonging to the corporation from time to time shall be turned into the State Treasury and shall be carried in a special account to the credit of the corporation, and shall be subject to be drawn on by the corporation upon the approval of the Governor, but solely for the purposes of this act.
The corporation shall make and enforce all such reasonable rules and regulations not inconsistent with the terms of this act as may, in its opinion, be proper and suited in carrying out the purposes of this act.
Section 9. Maximum Amount of Bonds. The maximum amount of notes, debentures, bonds and other evidences of indebtedness outstanding at any time shall not exceed the amount of State school warrants and school warrants of the boards of education of the several counties and municipalities of the State held by the corporation, but in no case to exceed Fifteen Million Dollars at any time.
Section 10. Appropriation. There is hereby appropriated out of the general fund of the State the sum of Two Million Dollars, or so much thereof as may be necessary to carry out the provisions of this act. Said appropriation to be an asset of the corporation and carried upon the books of the State Auditor and State Treasurer as a special fund of the Alabama Educational Finance Corporation, and shall be subject to be drawn on by the corporation upon the approval of the Governor, but solely for the purposes of this act.
Section 11. Dissolution. Any corporation organized under this act may be dissolved by the applicants, or their successors, filing with the Secretary of State their application therefor, which shall be subscribed, sworn to and certified as in the case of an application for incorporation. Upon the filing of said certificate, the corporation shall cease, and all of its property rights shall pass to the State of Alabama, but no applicant shall be responsible for liabilities of the dissolved corporation in any greater sum than the value of the property of such corporation which may come into his possession under its dissolution. The Secretary of State shall record the application for dissolution and shall make and issue, under the seal of the State, his certificate that the corporation is dissolved, and shall record the certificate with the application for dissolution.
Section 12. Succession. Should any applicant die, or his term of office expire before the dissolution of the corporation, his successors in office shall take his place and official position as a member of said corporation.
Section 13. No Fees to the Secretary of State. There shall be no fees paid to the Secretary of State for any work in connection with the incorporation or dissolution of the corporation.
Section 14. Record Prima Facie Evidence. Any record kept or certificate issued in pursuance of this act, or a copy of any such record certified to be true by the legal custodian thereof, shall be received in evidence in all courts, and shall be prima facie evidence of the facts therein recited, or thereby shown.
Section 15. Officers of Corporation. The president of said corporation shall be the Superintendent of Education of Alabama, and vice-president and the secretary shall be selected and designated by the three members.
(b) No officer of the corporation shall draw any salary in addition to that now authorized by law for his services in connection with said corporation.
(c) This act shall take effect immediately upon its passage and approval.
(d) Should any provision of this act be declared unconstitutional, it shall not affect the remaining part of the Act.
Response of the Justices.
To the Honorable Senate of Alabama:
Replying to your inquiry concerning Senate Bill 51, the undersigned Justices of the Supreme Court of Alabama are of the opinion that the financial scheme therein disclosed is, without reference to any other provision of the Constitution, violative of section 213 of our State Constitution. In re Opinions of the Justices, 223 Ala. 130, 136 So. 489.
We are of the opinion that the bill here proposed is to be differentiated from the act considered in Alabama State Bridge Corporation et al. v. Smith, 217 Ala. 311, 116 So. 695.
Signed, this the 31st day of August, 1932.
JOHN C. ANDERSON, Chief Justice.
LUCIEN D. GARDNER, Associate Justice.
WILLIAM H. THOMAS, Associate Justice.
VIRGIL BOULDIN, Associate Justice.
JOEL B. BROWN, Associate Justice.
A. B. FOSTER, Associate Justice.
THOMAS E. KNIGHT, Associate Justice.
Comments