BILL ANALYSIS
SENATE COMMITTEE ON ELECTIONS, REAPPORTIONMENT AND
CONSTITUTIONAL AMENDMENTS
Senator Loni Hancock, Chair
BILL NO: SCA 5 HEARING DATE:
8/25/09
AUTHOR: HANCOCK ANALYSIS BY:
Darren Chesin
AMENDED: AS INTRODUCED
FISCAL: YES
SUBJECT
State budget: vote threshold
DESCRIPTION
Existing law , pursuant to the California Constitution,
provides that the following types of bills require a
two-thirds vote of each house of the Legislature for
passage:
Bills that raise taxes.
Bills containing an urgency clause.
Bills, including the budget bill, that make
appropriations from the General Fund.
This measure would exempt General Fund appropriations in
the budget bill from the two-thirds vote requirement.
Existing law , pursuant to the California Constitution,
provides that a statute takes immediate effect upon
enactment if it calls for an election, provides for a tax
levy or makes an appropriation for the usual and current
expenses of the state, or is an urgency statute.
This measure would also provide that statutes enacting the
budget bill and statutes enacting bills identified in the
budget bill as necessary to implement it take effect
immediately
BACKGROUND
Other States . According to the National Conference of
State Legislatures (NCSL), some states require an
extraordinary vote to pass general appropriations bills for
state operations. Although they are not spending limits in
the traditional sense, requirements for a supermajority --
two-thirds, three-fourths or three-fifths of the
legislature -- can limit spending decisions if an agreement
cannot be reached.
Vote requirements vary. Nine states have some type of
requirement. Three -- Arkansas, California and Rhode Island
-- need a supermajority vote each budget cycle to pass
appropriations bills. Of the 47 states that require a
simple majority vote, six -- Connecticut, Hawaii, Illinois,
Maine, Mississippi and Nebraska -- require a supermajority
under certain conditions.
Arkansas. A constitutional amendment that became
effective in 1934 requires the Arkansas Legislature to
obtain a three-fourths majority on appropriations for all
purposes except education, highways, and paying down the
state debt. Appropriations for these purposes require a
simple majority of members elected.
California. A constitutional provision dating back to
1933 requires a two-thirds vote for general fund
appropriations for purposes other than public schools.
Because the Legislature typically passes one main budget
bill, the requirement has effectively applied to the
whole budget bill.
Connecticut. Appropriations require a simple majority of
members elected, unless the general fund expenditure
ceiling is exceeded. In that case, the Legislature must
obtain a three-fifths majority.
Hawaii. Appropriations require a simple majority of
members elected, unless the general fund expenditure
ceiling is exceeded. In that case, the Legislature must
obtain a two-thirds majority.
Illinois. Since 1994, an amendment to the constitution
has required a majority vote until June 1 to pass all
legislation, including the budget. After that date, the
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Legislature must obtain a three-fifths vote. The intent
is to provide an incentive for the Legislature to
complete its work in a timely fashion before the
supermajority is required. Budgets were passed on time
in 1995, 1996 and 1997, but it is not certain that the
supermajority vote is responsible. The previous
requirement, that a three-fifths majority was needed
after June 30, failed to prevent late budgets on a number
of occasions in the 1980s and early 1990s.
Maine. A simple majority is required to pass all bills,
and they become effective 90 days after the Legislature
adjourns. If the budget isn't passed before April 1,
however, it will not take effect by July 1, the beginning
of the fiscal year. For the budget to be operative in
time, the Legislature must pass it as an emergency,
requiring a two-thirds vote. Bills passed as emergencies
take effect immediately.
Nebraska. Similar to Maine, a Nebraska provision
dictates bill effective dates to be 90 legislative days
after they are enacted in odd years. If the budget is
passed after the end of March in an extended session, an
emergency clause requiring a two-thirds vote is attached
to make it operative at the beginning of the fiscal year.
Rhode Island. For appropriations for local or private
purposes, a two-thirds majority vote is required.
Because the state typically drafts all main
appropriations bills for operations into a single budget
bill, a two-thirds vote has been effectively necessary
for all appropriations.
California Constitution Revision Commission . In its 1996
Final Report and Recommendations to the Governor and the
Legislature, the California Constitution Revision
Commission stated the following regarding the existing
two-thirds vote requirement to approve a state budget:
Currently, all General Fund appropriations, except those
for public schools, must be approved by a two-thirds vote
of both houses of the Legislature. This requirement dates
back to a 1933 amendment that required a two-thirds vote on
the budget bill if General Fund appropriations grew by more
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than five percent. Since budget growth after 1933 almost
always exceeded five percent, the practical effect was to
routinely require a two-thirds vote for passage of budget
bills. A 1962 amendment removed the five percent formula,
and simply required a two-thirds vote on the budget.
In theory a two-thirds vote would encourage a compromise
between the majority and minority parties. For a number of
years, the system worked in this manner. Recently, however,
it has permitted those who have specific interests, which
may or may not be related to the budget, to delay passage
of the budget by leveraging their issue into the budget
debate.
In 1993 the Citizens Budget Commission found that long
budget delays, where a small group of legislators were able
to stall budget adoption, caused higher levels of spending.
The Constitution Revision Commission agreed with that
finding. Although conventional wisdom indicates otherwise,
the two-thirds vote requirement does not seem to limit
higher levels of spending. In practice, it encourages it.
The Constitution Revision Commission concluded that
requiring a majority vote is the most equitable way to deal
with increasing demand in an era of scarce resources. The
Commission believes that with its recommendations related
to balancing the budget, restricting borrowing, and
requiring a reserve built into the budget process to
provide more fiscal discipline, a majority vote for
enactment of the budget is appropriate. The majority vote
recommendation applies to enactment of the budget, budget
implementation bill, and rebalancing bill. The Commission
recommends maintaining the requirement for a two-thirds
vote for any tax increase. Therefore, program expenditures
may be adjusted by a majority vote and the taxpayers
maintain their protection of a two-thirds vote on the
imposition of new taxes.
COMMENTS
1.According to the author , sixteen of the last twenty
budgets have been late. The budget gridlock is directly
linked to a rule in the Constitution that requires a
two-thirds vote by the Legislature to send the Governor a
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budget.
California's two-thirds requirement allows a small minority
of legislators to hold up the passage of the budget.
California's two-thirds requirement concentrates power not
with the majority of legislators elected by the People of
California but in the hands of a few who often extract
non-budget related policy concessions.
The two-thirds requirement makes it difficult for the
public to understand why budget decisions are made. A
majority vote will provide transparency and clarify for
the public who is making decisions and should be held
accountable.
The two-thirds vote requirement is an unusual rule. The
United States Congress requires a simple majority vote.
Every city, county and local government agency in
California only requires a majority vote to pass a
budget. The vast majority of states require a simple
majority vote. Only three states, including California,
always require more than a majority vote to approve a
budget.
The two-thirds vote requirement is - without exception -
the primary reason why the budget is consistently late.
There is still debate in a majority vote system but not
the same kind of gridlock created by allowing a minority
of legislators to dominate the budget process.
Californians want an on-time and responsible budget. In
a democracy, the majority ought to determine how to raise
and spend the money we use to buy together what we can't
afford to buy separately - schools, roads, bus and train
systems, police and fire protection.
2.Related Legislation . Numerous measures have been
introduced this session to address the vote threshold for
a state budget although SCA 5 is the first to be heard in
a policy committee. Others are:
SCA 1 (Walters) Provides that the budget may be approved
with a majority vote if the total amount of General Fund
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appropriations for that fiscal does not increase more
than 5% from the immediately preceding fiscal year.
SCA 9 (Ducheny) Lowers the vote threshold in each house to
approve the budget bill to 55%.
SCA 15 (Calderon) Lowers the vote threshold in each house
to approve the budget from two-thirds to a majority.
SCA 22 (Wolk and DeSaulnier) Lowers the vote threshold to
approve the budget to a majority vote if the budget does
not exceed the appropriations limit (as adjusted for the
change in the cost of living and population) or does not
exceed 105% of the previous year's General Fund
appropriations. It also lowers the vote threshold to
raise revenue as long as the revenue generated does not
exceed the appropriations limit or 105% of the previous
fiscal year.
ACA 4 (Bass) Lowers the vote threshold in each house to
approve the budget from two-thirds to a majority.
ACA 18 (Evans) Lowers the vote threshold in each house to
approve the budget from two-thirds to a majority.
POSITIONS
Sponsor: Author
Support: American Federation of State, County and
Municipal Employees
California Communities United Institute
California Nurses Association
California Professional Firefighters
California School Employees Association
California State PTA
Small School Districts Association
State Building Construction and Trades Council,
AFL-CIO
Oppose: None received
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