WATER DEPARTMENT ‑- SURPLUS PROFITS ‑- AUTHORITY OF CITY OF BREMERTON, A FIRST CLASS CITY, TO TRANSFER SUCH FUNDS TO GENERAL FUND

WATER DEPARTMENT ‑- SURPLUS PROFITS ‑- AUTHORITY OF CITY OF BREMERTON, A FIRST CLASS CITY, TO TRANSFER SUCH FUNDS TO GENERAL FUND

The City of Bremerton, a city of the first class, may properly transfer the surplus funds of its water department to the city's general fund.

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                                                              September 28, 1950

Honorable Jack H. Rodgers
Senator, Twenty-third District
1907 ‑ 5th Street
Bremerton, Washington                                                                                                              Cite as:  AGO 49-51 No. 339

Dear Sir:

            You have orally requested our opinion on the following question:

            May the City of Bremerton, a city of the first class, whose water department has surplus funds derived from profits, properly transfer such surplus to the city's general fund?

            From the oral statement of facts given us, we understand that the funds involved constitute a surplus of profits derived from the operation of the water department; that the matured obligations of the department have been provided for; and that such funds are not necessary for the maintenance and expenses of the system.

            Our conclusion is as follows:

            Surplus profits of the water department of the City of Bremerton, a city of the first class, may be transferred to the city's general fund.

                                                                     ANALYSIS

            We find no statutory provision controlling the disposition of surplus funds of the water department of a city of the first class.  In the absence of statutory provision prohibiting such action there appears to be no valid objection to the transfer of such surplus to the city's general fund upon authorization by the city council.

             [[Orig. Op. Page 2]]

            In the case ofTwitchell v. Spokane, 55 Wash. 86, 104 Pac. 150, it was contended that the transfer of profits from the operation of the Spokane water system to the general fund of the city was illegal.  In holding that such transfer was proper our Supreme Court said:

            "The evidence shows that certain funds were transferred from the water account to the general fund.  It is not clear that the funds so transferred were used for general purposes, but we assume that they were so used.  We find nothing in the record to indicate that such money was required to be kept in a special fund, or that there were any outstanding overdue warrants to which it could have been applied.  The matured obligations against the water fund all seem to have been met when due.  When there is no requirement by statute or otherwise that money coming into the city treasury shall be kept in a special fund and applied to a particular purpose, it is proper, of course, to place it in the general fund, and to use it for general city purposes.  If we understand counsel correctly, it is not claimed that any money derived from the sale of water or from the water system which was necessary for the maintenance and expenses of the system, was transferred to the general fund, but it is claimed that the profits of the system, after the expenses were paid, were placed in the general fund and that this was illegal; * * *"

            We have examined a copy of the charter of the City of Bremerton and find nothing therein which would modify our conclusion that such transfers may be made by means of a city ordinance.

Very truly yours,

SMITH TROY
Attorney General

FRED L. HARLOCKER
Assistant Attorney General