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Attorney General

Bob Ferguson

AGO 1952 No. 374 -
Attorney General Smith Troy


The proposed provision requiring an independent running audit of all accounts and books of the city may properly be included in the charter of a first class city.

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                                                                 August 13, 1952

Honorable Cliff Yelle
State Auditor
Legislative Building
Olympia, Washington                                                                                                              Cite as:  AGO 51-53 No. 374

Attention:  Mr. A. E. Hankins

Dear Sir:

            Receipt is hereby acknowledged of your letter of July 29, 1952, in which you direct our attention to the following facts:

            "The Freeholders Commission of the City of Tacoma is presently formulating a new Tacoma City Charter, which will provide for a Council-Manager form of government.

            "The following is a provision tentatively accepted by the Freeholders Commission for the inclusion in the proposed charter:

            "'Section 7.14.  The Council shall provide for a running audit of all accounts and books of the city by a firm of independent public accountants who are in no way connected with the city.  A comprehensive annual report on the financial condition of the city shall be prepared by such firm, which shall be submitted to the Council and open to public inspection.  A complete audit shall also be made and a report submitted on the death, removal, or resignation of the Director of Finance.'"

            You request our opinion as to "whether or not in view of the existing statutes relating to the examination of taxing districts, such a provision requiring an independent audit may properly be included in a city charter."

            It is our conclusion that the proposed provision, quoted above, is not in contravention of any existing constitutional provision or legislative enactment, and, therefore, may properly be a portion of a charter of a city of the first class.


            Article XI, section 10, of the State Constitution provides insofar as it is pertinent to this question, that:

            "* * * and cities or towns heretofore or hereafter organized and all charters thereof framed or adopted by authority of this constitution shall be  [[Orig. Op. Page 2]] subject to and controlled by general laws.  Any city containing a population of twenty thousand inhabitants or more shall be permitted to frame a charter for its own government consistent with and subject to the constitution and laws of this state, * * *."

            RCW 35.22.020 (§ 1, chapter 17, Laws of 1911, Rem. Rev. Stat. § 8948), provides:

            "The form of the organization and the manner and mode in which cities of the first class shall exercise the powers, functions and duties conferred upon them by law, with respect to their own government, shall be as provided in the charters thereof."

            RCW 35.22.200 (Rem. Rev. Stat. § 8977) provides in part that all:

            "* * * legislative powers of a city of the first class shall be vested in a mayor and a city council, to consist of such number of members and to have such powers as may be provided for in its charter.  * * *."

            RCW 35.22.570 (§ 7, page 224, Laws of 1890, Rem. Rev. Stat. § 8981) provides:

            "Any city adopting a charter under the provisions of this chapter shall have all the powers which are conferred upon incorporated cities and towns by this title or other laws of the state, and all such powers as are usually exercised by municipal corporations of like character and degree."

            The framers of this act also provided:

            "The rule that statutes in derogation of the common law are to be strictly construed shall have no application to this act, but the same shall be liberally construed for the purpose of carrying out the objects for which this act is intended."

            The plan of action contemplated by the proposed charter provision, has authority for its establishment in RCW 35.18.060, subdivision (2), (section 1, chapter 84, Laws of 1945), which reads in part as follows:

            "* * *Provided, That the council may cause an audit to be made of any department or office of the city or town government and may select the persons to make it, without the advice or consent of the city manager;"

            InState ex rel. Griffiths v. Superior Court, 177 Wash. 619, p. 623, 33 P. (2d) 94, the court said:

             [[Orig. Op. Page 3]]

            "* * * While the charter framed by the city is subject to, and controlled by, general laws, the limitation simply means that the provisions of the charter shall not be in contravention of any legislative enactment.  * * *"

            InAyers v. City of Tacoma, 6 Wn. (2d) 554, 108 P. (2d) 348, the rule was stated as follows:

            "* * * a state law will not be construed as impliedly taking away from a first-class city an existing power.  In order to accomplish that result, the state statute must be clear and unambiguous.  * * *"

            The only statutes which might possibly be in conflict with the proposed charter provision are those regarding the duties of the state auditor as they relate to the system of accounts for public institutions and public offices, and the examination of taxing districts.  RCW 43.09.190 provides:

            "There shall be in the office of the state auditor a division to be known as the division of municipal corporations, the principal officer of which shall be the state auditor.  He may appoint and deputize an assistant to be known as chief examiner to have charge of the division, subject to the supervision and control of the state auditor."

            RCW 43.09.200 provides in part as follows:

            "The state auditor, through such division, shall formulate, prescribe, and install a system of accounting and reporting, which shall be uniform for every public institution, and every public office, and every public account of the same class."

            RCW 43.09.210 provides:

            "Separate accounts shall be kept for every appropriation or fund of a taxing or legislative body showing date and manner of each payment made therefrom, the name, address, and vocation of each person, organization, corporation or association to whom paid, and for what purpose paid."

            RCW 43.09.230 provides in part:

            "The state auditor shall require from every taxing district, and public institution, financial reports covering the full period of each fiscal year, in accordance with the  [[Orig. Op. Page 4]] forms and methods prescribed by him, which shall be uniform for all accounts of the same class."

            RCW 43.09.260 provides in part:

            "The state auditor, the chief examiner, and every state examiner shall have power by himself or by any person legally appointed to perform the service, to examine into all financial affairs of every public office and officer.

            "The examination of the financial affairs of townships, cities and towns, and school districts shall be made at least once in every two years; all other examinations shall be made at least once a year.

            "On every such examination, inquiry shall be made as to the financial condition and resources of the taxing district; whether the Constitution and laws of the state, the ordinances and orders of the taxing district, and the requirements of the division of municipal corporations have been properly complied with; and into the methods and accuracy of the accounts and reports."

            The statutes quoted above place the control of the systems of accounting procedure and reports for the various public institutions within the jurisdiction of the state auditor, and further, empower him to examine into the financial affairs of municipal corporations and investigate into whether the municipal corporations are complying with the Constitution and statutes and requirements of the Division of Municipal Corporations.

            The proposed charter provision in question purports to authorize the city council to employ an independent accounting firm to keep a running audit of the accounts and books of the city, file an annual report of the financial condition of the city, and a complete audit and report on the death, resignation or removal of the director of finance.  It does not prescribe, or attempt to authorize a different system of accounting or reports required by the state auditor in connection with the examination of the city's activities.  And, further, it would not supersede the state auditor's examination or the expense of such examination to the city.

            Although it is not germane to the question presented, it would seem proper to point out that the proposed provision is phrased in mandatory terms such as would require the council to implement this practice regardless of its relative necessity or wisdom.

            We therefore conclude that the proposed charter provision, quoted above, is not in contravention of any existing Constitutional provision  [[Orig. Op. Page 5]] or legislative enactment, and therefore, may properly be a portion of a charter of a city of the first class.

Very truly yours,

Attorney General

Assistant Attorney General