Proposition 31 : State Budget

Official title : State Budget. State and Local Government. Initiative Constitutional Amendment and Statute

State analysis     /    Money trail

Summary :

1. Establishes two-year state budget cycle beginning in 2015.
2. Prohibits Legislature from creating expenditures of more than $25 million unless offsetting revenues or spending cuts are identified.
3. Permits Governor to cut budget unilaterally during declared fiscal emergencies if Legislature fails to act.
4. Requires performance reviews of all state programs at least once every 5 years.
5. Requires performance goals in state and local budgets.
6. Requires publication of bills at least three days prior to legislative vote (except for natural disaster and terrorost attack measures).
7. Allows local governments to decide how to provide services and instead of implementing state laws/regulations, create "functionally equivalent" procedures.
8. Local governments get to decide how property taxes are allocated among local government entities.

Notes:

1. Budget:
   1. Currently budget requires passing by a majority in both houses, 2/3 vote in both houses to increase state taxes.
   2. State constitution mandates that the overall budget be balanced.
   3. Under this proposition, if a bill increases spending by over $25M, Legislature must show how it would be offset by other spending reductions and/or revenue increases.
   4. Exemptions:
      1. one-time spending for a state department or program
      2. increase funding for a department or program due to increases in workload or the cost of living
      3. provide funding required by federal law
      4. increase the pay or other compensation of state employees pursuant to a collective bargaining agreement
      5. bills that restore funding to state programs reduced to help balance the state budget in any year after 2008–09
      6. Under this proposition, if a bill decreases revenues by over $25M, Legislature must show how it would be offset by spending reductions and/or other revenue increases.
      7. Additional Governor powers:
         1. Only comes into play if the Legislature does not pass legislation to address a fiscal emergency within 45 days.
         2. Governor could not reduce spending that is required by the Constitution or federal law (most school spending, debt service, pension contributions, and some health and social services).
         3. Total amount of the reductions could not exceed the amount necessary to balance the budget.
         4. The Legislature could override all or part of the reductions by a two-thirds vote in both of its houses.
         5. Local procedures notes:
            1. Services included: economic development, education, social services, public safety, and public health
            2. State funds would be used for the local "functionally equivalent" procedures instead of the state law or regulation.
            3. Local procedures could be vetoed by the State Legislature
            4. Local procedures would expire after 4 years.