Can a Virginia board of supervisors reduce a school board appropriation it has already made, by passing a later budget amendment?

Plain-English summary

The Powhatan County Board of Supervisors adopted its FY2011 budget on April 12, 2010, with a resolution that said "[t]he amount hereby approved for the School Fund is $42,007,557 and is appropriated lump sum." A month later, on May 10, 2010, the Board passed a resolution to "amend the FY11 adopted budget" that reduced the school amount by $123,213, saying the school board had parked money in a contingency line instead of using it to ease salary reductions.

A delegate asked the AG whether the Board could do that. The AG's answer: no, not based on those facts.

Virginia distinguishes between adopting a budget (a planning act) and making an appropriation (the formal act that actually makes money available for spending). A board of supervisors can decline to appropriate, can appropriate in stages (monthly, quarterly, etc.), and can increase or decrease budgeted amounts in major classifications before it appropriates. But once it appropriates, the money belongs to the school board for the school board to spend, within the statutory major classifications. The Supreme Court of Virginia held the same thing in Bd. of Supvrs. of Chesterfield County v. County Sch. Bd., 182 Va. 266 (1944): after appropriation, "the exclusive right to determine how this money shall be spent is in the discretion of the school board."

The April 12 resolution explicitly said the amount "is appropriated lump sum," and the May 10 amending resolution itself referred back to that act as the "total amount appropriated." Both resolutions treated April 12 as an appropriation, not just a budget approval. So the Board lacked the authority to claw back $123,213 unilaterally.

Currency note

This opinion was issued in 2010. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The school budget and appropriation framework in Title 22.1 and Title 15.2 has been amended periodically since 2010. The general principle that appropriation is distinct from budget adoption and that boards of supervisors cannot reduce appropriations already made is long-standing, but specific procedural rules, classifications, and timing requirements have changed. Anyone managing a current school budget dispute should look at the current text.

Common questions

What's the difference between a budget and an appropriation?
A budget is a planning document. It says: here's what we expect revenues to be and here's what we'd like to spend on each line. An appropriation is the legal act that makes money available for spending. Adopting a budget does not, by itself, authorize anyone to write checks; an appropriation does. As the opinion put it, "Approval of the budget . . . is not an appropriation. The formal act of appropriation by the governing body actually sets aside money for a specific use."

Could the Board of Supervisors have avoided this problem?
Yes. The opinion lays out the toolkit. The Board could have made periodic appropriations (monthly, quarterly) instead of a single lump-sum appropriation. It could have appropriated only basic costs and put nonessential expenditures into a contingency line for later release. It could have increased or decreased budgeted amounts within major classifications when it made its initial appropriation. Each of those moves preserves the Board's leverage over how money is released.

Why is a "lump sum" appropriation so binding?
Because the school board has discretion to spend within the major classifications prescribed by the Board of Education once funds are appropriated. The school board can shift money inside a classification but cannot transfer between classifications. Once the supervisors hand over a lump sum, the school board controls the inside-classification choices.

Did the school board misbehave by putting money in contingency?
The opinion does not say. The Board of Supervisors clearly thought so (the May 10 resolution explicitly complained about it). But that's a political and policy disagreement, not a legal basis for clawback. The AG's answer is procedural: whatever the school board did with the money, the appropriation was already complete.

What about the June 14 "resolution appropriating the fiscal year 2011 budget"?
The opinion noted that the June 14 resolution, which set the school fund at $41,884,928, appeared to be a departure from the Board's usual practice and that no separate appropriation resolutions had been adopted in 2007, 2008, or 2009. That helped support the AG's reading that the actual appropriation happened on April 12, not in June.

What does this opinion mean for current disputes?
The hard rule is that an appropriation, once made, transfers spending discretion within statutory classifications to the school board. Disputes today often turn on whether what happened was an appropriation or just a budget adoption. Resolution language matters.

Background and statutory framework

The Virginia school budget and appropriation framework divides responsibility between the local governing body and the school board.

Budget preparation. The superintendent prepares an estimate of money needed for the next fiscal year, using the major classifications prescribed by the Board of Education. The school board holds at least one public hearing and approves a budget for submission to the local governing body.

Local governing body action. The governing body approves the annual educational budget within a statutory timeframe and may approve a budget different from what the school board submitted. Scott County Sch. Bd. v. Scott County Bd. of Supvrs., 169 Va. 213 (1937).

Appropriation. Appropriation is a separate, formal act, statutorily distinguished from budget adoption. As the opinion put it, "Approval of the budget . . . is not an appropriation. The formal act of appropriation by the governing body actually sets aside money for a specific use." The governing body can make appropriations annually, semiannually, quarterly, or monthly.

After appropriation. Once appropriated, the school board has discretion to spend within the law and the local appropriation, can shift money inside major classifications, but cannot transfer between them. Bd. of Supvrs. of Chesterfield County v. County Sch. Bd. of Chesterfield County, 182 Va. 266 (1944).

The factual hinge in this opinion was the April 12 resolution's express use of "is appropriated lump sum." That language, combined with the May 10 resolution's own description of the April 12 act as the "total amount appropriated," led the AG to conclude that the Board of Supervisors had in fact appropriated, not just budgeted, on April 12.

Citations

• Va. Code § 2.2-505
• Scott County Sch. Bd. v. Scott County Bd. of Supvrs., 169 Va. 213, 217, 193 S.E. 52, 54 (1937)
• Bd. of Supvrs. of Chesterfield County v. County Sch. Bd. of Chesterfield County, 182 Va. 266, 281, 28 S.E.2d 698, 705 (1944)
• Almond v. Day, 197 Va. 419, 426, 89 S.E.2d 851, 855 (1955)

Source

• Landing page: https://www.oag.state.va.us/annual-reports-opinions/official-opinions
• Original PDF: https://www.oag.state.va.us/files/Opinions/2010/10-049-Ware.pdf

Original opinion text

COMMONWEALTH of VIRGINIA
Office of the Attorney General
Kenneth T. Cuccinelli, II
Attorney General

November 12, 2010

900 East Main Street
Richmond, Virginia 23219
804-786-2071
FAX 804-786-1991
Virginia Relay Services
800-828-1120
7-1-1

The Honorable R. Lee Ware, Jr.
Member, House of Delegates
P.O. Box 689
Powhatan, Virginia 23139

Dear Delegate Ware:

I am responding to your request for an official advisory opinion in accordance with § 2.2-505 of the Code of Virginia.

Issue Presented

You ask whether a board of supervisors, by an amendment to its adopted budget, may reduce the amount previously budgeted for the local school fund when the supervisors' original budget resolution and their subsequent resolution to amend the adopted budget both expressly describe the school fund amount as being "appropriated" in the original budget resolution.

Response

It is my opinion, based on the facts available to me, that the Board of Supervisors made an appropriation to the School Board and, therefore, did not have the authority to reduce an appropriation previously made.

Background

On April 12, 2010, the Powhatan County Board of Supervisors ("Board of Supervisors") established the tax rates and adopted a Fiscal Year (FY) 2011 budget for the county by a resolution which stated, in relevant part, "[t]he amount hereby approved for the School Fund is $42,007,557 and is appropriated lump sum." Other items listed in this resolution do not contain the language "is appropriated lump sum." On May 10, 2010, the Board of Supervisors adopted a "resolution to amend the FY11 adopted budget." In this resolution, the Board of Supervisors noted that "the total amount appropriated to the School Fund for FY11 was $42,007,557 . . . ." The Board of Supervisors observed that it had "implored the School Board to minimize the salary reductions." The Board of Supervisors further stated that the School Board had "placed $123,213 in a contingency line for distribution at a later time and did not utilize these surplus funds for any relief related to the salary reductions." The Board of Supervisors "resolved [that it was] amending the School Board adopted FY11 budget from 42,007,557 to 41,884,344" — a reduction of $123,213. Finally, on June 14, 2010, the Board of Supervisors adopted a "resolution appropriating the fiscal year 2011 budget", providing that "[t]he amount approved for the School Fund is $41,884,928." This June 14, 2010, resolution appears to be a departure from the usual practice of the Board of Supervisors; a review of the official minutes for that governing body found no evidence that the Board of Supervisors had adopted an appropriation resolution separate from its annual budget resolution in 2009, 2008, or 2007.

Applicable Law and Discussion

School budgets involve a division of responsibility between the governing board of a locality and the school board. The superintendent of each public school division is tasked with preparing an "estimate of the amount of money deemed to be needed during the next fiscal year for the support of the public schools of the school division." The estimate must list the amounts proposed as necessary according to each "major classification prescribed by the Board of Education and such other headings or items as may be necessary." The local school board must hold at least one public hearing on the proposed budget prior to giving final approval of the budget for submission to the governing body of the locality. The governing body must then prepare and approve the annual educational budget within a statutory timeframe. The governing body may approve a budget that differs from that submitted by the school board.

In the counties of the Commonwealth, boards of supervisors exercise fiscal control through two distinct processes, budgeting and appropriations. Budgeting is a planning process, required by the General Assembly, to anticipate revenue needs and to make decisions about the priority of programs and level of services to be provided. Budgets adopted by local governing bodies, therefore, are for planning and informative purposes and are statutorily distinguished from appropriations. The appropriations process is the mechanism by which funds are made available for spending on those programs and operations the governing body has decided to support. Adoption of a budget that contemplates certain expenditures does not automatically result in the expenditure of money for that purpose. "Approval of the budget . . . is not an appropriation. The formal act of appropriation by the governing body actually sets aside money for a specific use."

The governing body has flexibility in the timing of its appropriations to the school board; it may make its appropriations on the same periodic basis — annually, semiannually, quarterly, or monthly — as it appropriates funds to other departments and agencies. Once funds are appropriated, however, the governing body is without authority to reduce the appropriation without the consent of the school board. As prior Opinions have noted, this does not leave a governing body without the power to affect educational expenditures: "It may make appropriations on a periodic basis, or appropriate school funds for basic costs only, while establishing a contingency fund for nonessential expenditures. Alternatively, it may in its appropriation increase or decrease the budgeted amounts for major classifications proposed by the school board."

Once funds are appropriated to it, the school board has the authority to determine how the funds will be spent, "consistent with law and the local appropriation." The school board may shift appropriations within the major classifications, but may not transfer funds from one classification to another.

The question to be resolved is whether the Board of Supervisors adopted a budget without making any appropriation to the School Board on April 12, 2010, or whether it appropriated funds to the School Board. If it is the latter, the Board of Supervisors could not reduce the prior appropriation on May 10, 2010. Based on the facts that are available to me, I conclude that the Board of Supervisors appropriated the funds to the School Board on April 12, 2010. The April 12, 2010 resolution states that the amount approved for the School Fund "is appropriated lump sum." The May 10, 2010, resolution by which the Board of Supervisors sought to reduce this amount states that "the total amount appropriated to the School Fund [on April 12, 2010] for FY11 was $42,007,557." Thus, the express language of the May 10, 2010, resolution confirms that the Board of Supervisors intended to, and did, appropriate the school fund amount on April 12, 2010. Having appropriated the funds and not merely budgeted the funds, the Board of Supervisors subsequently could not withdraw those funds from the School Board on May 10, 2010.

Conclusion

Accordingly, it is my opinion, based on the facts available to me, that the Board of Supervisors made an appropriation to the School Board and, therefore, did not have the authority to reduce an appropriation previously made.

With kindest regards, I am

Very truly yours,

Kenneth T. Cuccinelli, II
Attorney General