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Official Opinion 97-13

Official Opinion 97-13

March 28, 1997
To: 

Executive Director
Teachers Retirement System and Director Employees' Retirement System

Re: 

The Teachers Retirement System and the Employees' Retirement System of Georgia may seek, but are not required to seek, the assistance and approval of the Department of Administrative Services regarding custodian agreements for the Systems' investment securities.

The director of the Investment Division of the Teachers Retirement System, has asked whether the Teachers Retirement System of Georgia ("TRS") and the Employees' Retirement System of Georgia ("ERS") must purchase supplies and services through the Department of Administrative Services ("DOAS"). He has asked this question in the context of contemplating custodian services agreements for the investment securities of TRS and ERS.

The purchasing law generally requires "state government or any of its departments, institutions, and agencies" to procure services through DOAS. O.C.G.A. §§ 50-5-51(1), 50-5-57. However, the statutory phrase, "state government or any of its departments, institutions, and agencies" does not include the public corporations of the state commonly known as authorities. See 1989 Op. Att'y Gen. 89-56 (Correctional Industries is not subject to the Budget Act); 1982 Op. Att'y Gen. 82-24 (Under the Space Management Act, GRFA may seek DOAS assistance in finding rental space but is not required to).

ERS possesses the "powers and privileges of a corporation" and has possessed such powers and privileges since its creation in 1949. O.C.G.A. § 47-2-20; 1949 Ga. Laws 138, † 2.

Similarly, TRS also possesses "the power and privileges of a corporation" and has possessed such powers and privileges since its creation in 1943. O.C.G.A. § 47-3-20; 1943 Ga. Laws 640, † 2. In 1982, the Georgia Supreme Court construed these phrases to mean that ERS and TRS are each a "public corporation." Teachers' Retirement Sys. v. City of Atlanta, 249 Ga. 196, 197 (1982); see also Arneson v. Board of Trustees of the Employees' Retirement Sys., 257 Ga. 579 (1987); 34 Mercer L. Rev. 225, 230 (1982); 58 A.L.R.4th 274, 325 (1987).

Based on the foregoing, I have concluded that TRS and ERS are not "departments, institutions, and agencies" within the meaning of O.C.G.A. §§ 50-5-51 and 50-5-57. Accordingly, it is my official opinion that the Teachers Retirement System and the Employees' Retirement System of Georgia may seek, but are not required to seek, the assistance and approval of the Department of Administrative Services in procuring custodian services for the Systems' investment securities. Keep in mind, however, that the General Assembly may, and at times, does include authorities in its general regulation of state government. For example, in the open meetings law, the word "agency" is defined to include state authorities. O.C.G.A. § 50-14-1(a)(1)(A).

Prepared by:

SHIRLEY R. KINSEY
Assistant Attorney General