H. B. 4660


(By Mr. Speaker, Mr. Kiss, and Delegates Michael,

Staton and Frederick)


[Introduced February 26, 2004; referred to the

Committee on Finance.]




A BILL to amend and reenact §5-3-5 of the code of West Virginia, 1931, as amended; and to amend said code by adding thereto a new section, designated §5-3-6, providing for the disposition of funds or assets recovered in a legal action or settlement by or on behalf of the general public, the state or its officers, agencies or political subdivisions.

Be it enacted by the Legislature of West Virginia:
That §5-3-5 of the code of West Virginia, 1931, as amended, be amended and reenacted; and that said code be amended by adding thereto a new section, designated §5-3-6, all to read as follows:
ARTICLE 3. ATTORNEY GENERAL.
§5-3-5. Fees to be paid into state treasury.
On the final determination of any cause in any of the courts mentioned in the second section of this article, in which the attorney general appeared for the state, the clerk thereof shall certify to the auditor the fee of the attorney general which was taxed in the bill of costs against the defendant, and when such fee shall be collected it shall be paid into the state treasury and placed to the credit of the state fund.
§5-3-5. Attorney General's Litigation Support Fund.
(a) There is established in the state treasury a special fund to be known as the "Attorney General's Litigation Support Fund."
(b)(1) The fund may consist of any and all monies designated by a court order as reasonable attorney fees and related expenses received by the attorney general pursuant to this section as a result of any fees, fines, restitution, forfeitures, penalties, costs, interest, or judgments collected pursuant to any civil litigation, or any administrative proceedings, or in settlement of any claim asserted by or against the people of West Virginia, the State of West Virginia, or any of its departments, agencies, institutions, officers, employees, or political subdivisions thereof. Monies in the fund shall be available for expenditure only upon appropriation by the Legislature in accordance with the provisions of West Virginia Constitution, article six, section fifty-one.
(2) Notwithstanding the provisions of subdivision (1) of this subsection, the fees, fines, restitution, forfeitures, penalties, costs, interest, judgments or settlements received by the office of the attorney general on behalf of the people of West Virginia, the State of West Virginia, or any of its departments, agencies, institutions, officers, employees, or political subdivisions thereof that are in excess of the actual expenses of the office of the attorney general pursuant to the litigation or the issue settled shall, after the payment of any attorney fees and related expenses to the attorney general's litigation support fund as provided for by subdivision (1) of this subsection, be deposited in the treasury of the state, unless:
(A) The recovery or a portion thereof was on behalf of a special or trust fund, in which event the money should be deposited in such special or trust fund established in the state treasury; or
(B) The recovery was on behalf of a political subdivision of the state, in which event the remainder of the recovery shall be transmitted to the treasurer of such political subdivision for deposit in its general fund.
(3) The actual expenses of the office of the attorney general pursuant to litigation or the issue settled shall be certified by the attorney general to the governor, the secretary of the department of administration, the president of the Senate and the speaker of the House of Delegates.
(4) Notwithstanding any provision of this subsection, or any other provision of law, the attorney general may not accept judgments or settlements of any kind, or any part thereof, for the use of the office of the attorney general in excess of the actual expenses of the office of the attorney general pursuant to the litigation or the issue settled.
(c) The attorney general may expend monies appropriated by the Legislature from the fund for the performance of any of the powers, functions, duties, and responsibilities of the office of the attorney general.
(d) The fund shall be placed under the management or administration of the attorney general for the purpose of performing any of the functions, duties, powers, and responsibilities of the office of the attorney general and all monies deposited in the fund are available for appropriation to the office of the attorney general.
(e) The appropriation of these monies shall be in addition to any monies appropriated to the office of the attorney general from any other sources.
(f) Neither the attorney general, nor any employee of that office, shall have any financial interest in the investment of monies in the fund nor receive any commission with respect thereto.
(g) It shall be the duty of the attorney general to keep detailed permanent records of all expenditures and disbursements from the fund.
(h) On or before the fifteenth day of January, April, July and October, the attorney general shall cause to be filed with the governor, with copies to the secretary of the department of administration, the president of the Senate and the Speaker of the House of Delegates, a full and complete account of the receipts and disbursements from the fund in the previous calendar quarter.
§5-3-6. Public accountability for funds or assets recovered by the attorney general and other officer or agencies of the state through judgment or settlement; applicability of open records and open meetings laws; administration and disbursement of state judgment or settlement proceeds.

(a) The Legislature hereby finds and declares that:
(1) Public accountability for funds or other assets recovered in a legal action or settlement by or on behalf of the general public, the state or its officers, agencies or political subdivisions is appropriate and required, whether the character of the assets or funds recovered is public or private;
(2) Accountability for assets or funds recovered by the attorney general or other officer or agency of the state is essential to the public trust, and is even more critical when the attorney general or other officer of the state was a party to the action that resulted in the recovery by virtue of the public office he or she holds;
(3) Public accountability demands the applicability of the freedom of information law, article one, chapter twenty-nine-b of this code, and the open governmental proceedings law, article nine- a, chapter six of this code, so that the actions of individuals or agencies who are charged with the administration of funds or other assets are conducted in full view, and are open to public scrutiny;
(4) While it may be important that, in certain circumstances, funds or assets received retain their character, identity, and purpose, it is also important that the process by which funds are administered be open to public scrutiny and be accountable to the public; and
(8) The power to appropriate funds for public purposes is solely within the purview of the legislative branch of government, and the Legislature, as a steward of the budgetary process, shall take steps to assure that settlements are handled in a manner that assures maximum accountability to the citizens of the state and their duly elected legislative representatives.
(b) Therefore, any other provision of the common law or statutory law to the contrary notwithstanding:
(1) Whenever the Attorney General or other officer or agency of the state is a party to or has entered his or her appearance in, a legal action on behalf of the state of West Virginia, including ex rel. or other type actions, and a disposition of that action has resulted in the recovery of funds or assets to be held in trust by the state, through court action or otherwise, to administer the trust funds or assets, for charitable, eleemosynary, benevolent, educational, or similar public purposes, those funds shall be deposited in a special revenue account or trust fund established in the state treasury. The attorney general or other officer or agency of the state or a person, organization, or entity created by the attorney general or other officer or agency of the state are prohibited from administering trust funds or assets for charitable, eleemosynary, benevolent, educational, or similar public purposes.
(2) Any other provision of the common law or statutory law to the contrary notwithstanding, and except as otherwise provided in this section, any funds or assets not for charitable, eleemosynary, benevolent, educational, or similar public purposes, of any kind or nature whatsoever, including, but not limited to, public funds and private funds or assets when recovered by judgment or settlement of a legal action by or on behalf of the state of West Virginia, including ex rel. or other type actions filed by the attorney general or other officer or agency of the state under their statutory or common law authority shall be deemed public funds, and shall be deposited in the state treasury in the general revenue fund.
(3) No funds to which this subsection applies when deposited in an account in the state treasury shall be disbursed without a specific legislative appropriation of the deposited funds by the
Legislature while in regular or extraordinary legislative session.
(c) The common law, including the common law authority of any duly elected statewide
constitutional officer or other officer of the state, is specifically abrogated to the extent it is inconsistent with the provisions of this section.
(d) The provisions of this section shall not apply to actions by or on behalf of the state or its duly elected statewide constitutional officers or any other state official or agency, if the recovery sought and received is for specific individuals identified as parties to the action either by individual social security number, other individual identifying number, or by the individual's proper name.
(8) In the preparation of a judgment order that will result in the recovery of funds or assets by the state, the attorney general or other officer or agency of the state who is a party to or has entered his or her appearance in the action on behalf of the state of West Virginia shall advise the court of the provisions of this section.
(9) In the event of an extra-judicial settlement that would result in the recovery of funds or assets by the state, the attorney general or other officer or agency of the state acting on behalf of the state of West Virginia shall not agree to any terms contrary to the provisions of this section.
(10) Notwithstanding any statute or common law to the contrary, and except as provided in this subsection, an elected statewide constitutional officer or any other state official or agency shall not file or participate as a plaintiff, petitioner, party, intervening party, attorney, or amicus curiae in support of any litigation challenging the constitutionality of this section. State funds and employee time shall not be expended by any person or agency in support of such a challenge. If the constitutionality of this section is challenged, the governor, president of the Senate and Speaker of the House of Delegates, in their official capacities, shall be the only named respondents in that litigation.


Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added. Section 5-3-6 is new, therefore underlining is eliminated.