BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
5 (Hancock)
Hearing Date: 8/27/2009 Amended: As Introduced
Consultant: Maureen Ortiz Policy Vote: ER&CA 3-2
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BILL SUMMARY: SCA 5 will exempt General Fund appropriations in
the Budget Bill from the 2/3 vote requirement. It will also
provide that statutes enacting the Budget Bill and bills
identified as necessary to implement the Budget Bill take effect
immediately.
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
Ballot costs $298
$0 $0 General
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STAFF COMMENTS: This bill meets the criteria for referral to the
Suspense file.
SCA 5 will result in one-time General Fund costs of
approximately $298,000 to print an analysis of the measure and
arguments for and against the measure in the statewide voter
pamphlet. If this measure is enacted by January 28, 2010 it
will appear on the June 8, 2010 statewide primary election
ballot. If it is not enacted by January 28, 2010, but is
enacted before June 24, 2010, SCA 5 will appear on the November
2, 2010 statewide general election ballot. The most recent cost
estimates from the Secretary of State's Office are $74,500 per
page for printing and mailing, and the above fiscal impact
reflects four pages of text.
SCA 5 specifies that the changes to the Constitution made by
this measure will apply July 1 of the first fiscal year
commencing after the approval of this measure by the voters at a
statewide election, except that the changes will apply to the
Budget Bill for the first fiscal year commencing after the
measure's approval.
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.
California is one of only three states (along with Arkansas and
Rhode Island) that require a supermajority vote each budget
cycle to pass appropriations bills. However, six of the
remaining states do require a supermajority vote under certain
conditions.
Page 2
SCA 5 (Hancock)
California Constitution Revision Commission . In its 1996 Final
Report and Recommendations to the Governor and the Legislature,
the California Constitution Revision Commission stated, in part,
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 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 should force 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. 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 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 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.