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Nessel Issues Statement on State Administrative Board's Legal Authority to Direct Inter-Transfer of Funds

LANSING - Michigan Attorney General Dana Nessel issued the following statement after the State Administrative Board today exercised its authority to direct the inter-transfer of funds within departments. 

“In 1931, the legislature amended the State Administrative Board Act, Public Act 2 of 1921, to expressly grant the Board the power to ‘inter-transfer funds within the appropriation for the particular department, board, commission, officer or institution’.

“This authority – found at MCL 17.3 – was upheld by the Michigan Supreme Court in 1993 in Dodak v State Ad Board, Engler, when the Court rejected a challenge brought by members of the Michigan House of Representatives and the Michigan Senate.

“The Michigan Supreme Court held that neither subsequent amendments to the State Administrative Board Act nor the enactment of the Management and Budget Act indicated an intent by the legislature to repeal by implication the Board’s authority under MCL 17.3 to transfer funds within a department.

“As the Court noted in its decision, most members of the Administrative Board are elected in statewide elections – Governor Whitmer, Lieutenant Governor Gilchrist, Secretary Benson and myself – and the Board can direct the inter-transfer of funds only if a majority of the board agrees. That authority was exercised during today’s meeting of the board.”