June 8, 1993
C. Robin Britt, Sr., Secretary Department of Human Resources 101 Blair Drive Raleigh, North Carolina 27603-2041
RE: Counties’ Reduction Of Contributions To Area Authorities As The Result Of Additional Funds From The State Or Collection Of Fees Exceeding Budget Receipts; G.S. § 122C-2; G.S. § 122C-147(b)
Dear Secretary Britt:
On behalf of the Division of Mental Health, Developmental Disabilities and Substance Abuse Services, North Carolina Department of Human Resources, you have requested this office’s response to the following questions: (1) may a county, during the fiscal year, reduce its contribution to an area mental health, developmental disabilities, and substance abuse authority (hereinafter "area authority") as a result of the receipt by the area authority of additional funds from the State, and (2) may a county reduce its local tax revenue commitment to an area authority during the fiscal year if the area authority’s collection of fees for services exceeds its budgeted receipts during the year.
Your second question will be dealt with initially because G.S. § 122C-146 specifically addresses the issue. G.S. § 122C-146 requires area authorities to ". . . prepare fee schedules for services and to make every reasonable effort to collect appropriate reimbursement for costs in providing these services from individuals able to pay, including insurance and third-party payment, . . ." Additionally, the statute specifically provides that "[t]he collection of [such] fees by an area authority may not be used as a justification for reduction or replacement of the budgeted commitment of local tax revenue." (A copy of G.S. § 122C-146 is attached.) Therefore, a county may not reduce its local tax revenue commitment to an area authority during the fiscal year if the area authority’s collection of fees for services exceeds its budgeted receipts during the year.
With respect to your first question, the General Assembly has not so precisely explained the intended relationship between State-funded appropriations to area authorities and local revenue commitments. Thus, it is necessary to consider Chapter 122C as a whole in order to discern what the General Assembly intended the relationship to be. While recognizing that it is the courts and not the Attorney General’s office which have the prerogative to definitively determine the intent of the General Assembly when legislative intent is not clearly stated, this office can apply accepted rules of statutory construction to make a reasonable determination as to whether the General Assembly intended to permit a county to reduce its financial contribution to the area authority as a result of the receipt of an area authority of additional funds from the State.
It is well-established that "legislative intent may be inferred from the nature and purpose of [a] statute and the consequences which would follow, respectively, from various constructions." Alberti v. Manufactured Homes, Inc., 339 N.C. 727, 732, 407 S.E.2d 819 (1991). In addition, statutes are to be construed in such a way as to avoid absurd results. N.C. Commissioner of Insurance v. Rate Bureau, 300 N.C. 381, 434, 269 S.E.2d 547, rehg. denied, 301 N.C. 107, 273 S.E.2d 300 (1980). For example, a statute must not be given a construction which would undermine or subvert the very objective of the statute. Electric Supply Co. v. Swain Electrical Co., 328 N.C. 651, 656, 403 S.E.2d 291 (1991). Also, "significance and effect should be accorded every part of [an] act, including every section, paragraph, sentence or clause, phrase, and word." Hall v. Simmons, 329 N.C. 779, 784, 407 S.E.2d 816 (1991).
Bearing in mind the foregoing principles of statutory construction, it is the avowed policy of the State "to assist individuals with mental illness, developmental disabilities and substance abuse problems in ways consistent with the dignity, rights, and responsibilities of all North Carolina citizens." G.S. § 122C-2 (copy attached). To this end, the General Assembly has obligated both the State and local governments to work together to develop and maintain a public system for the delivery of services to persons with mental illness, developmental disabilities and substance abuse problems. G.S. § 122C-2 specifically provides that "[t]he furnishing of services to implement [this] policy requires the cooperation and financial assistance of counties, the State, and the federal government."
Given the stated purpose of Chapter 122C and the statutorily prescribed scheme for accomplishing same, this office cannot conclude that the General Assembly intended to allow a county to reduce its financial assistance to an area authority to the extent that the State is, from time to time, able to provide additional funding for mental health services. To construe the statute to permit a reduction in funding by a county would necessarily mean that the level of services provided by the area authority would remain constant despite increased State funding. Had the General Assembly intended to alleviate the fiscal burden or obligation of local governments by increasing State appropriations to the area authorities, we believe that the General Assembly would have plainly and clearly stated this intent.
Because the provision of mental health services is clearly intended by the General Assembly to be a joint effort on the part of the counties, the State and the federal government, it necessarily follows that the General Assembly did not intend to permit a county to reduce its obligation to an area authority simply because additional State funding becomes available. This conclusion is consistent with G.S. § 122C-147(a), which provides in pertinent part:
Unspent State and federal funds shall be remitted to the Department within 60 days after the date that a certified audit is rendered as required by the Local Government Commission.
It is apparent from the foregoing language that the General Assembly intended that if a surplus of funds exists as a result of the receipt of State funds by an area authority, the area authority must return the unspent State funds to the Department of Human Resources. Therefore, it is our opinion that funds appropriated by the State are not intended to be used as a substitute or replacement for local funding.
Ann Reed Senior Deputy Attorney General
Jane L. Oliver Assistant Attorney General