BILL ANALYSIS
SENATE COMMITTEE ON BUDGET AND FISCAL REVIEW
Denise Moreno Ducheny, Chair
Bill No: SCA 9
Author: Ducheny
As Amended: January 26, 2009
Consultant: Keely Martin Bosler
Fiscal: Yes
Hearing Date: April 12, 2010
Subject : Finance: state budget: taxes.
Summary : This constitutional amendment would lower the
vote threshold to pass a state budget to 55 percent of the
membership concurring in each house. This measure also
repeals the two-thirds vote requirement for raising state
revenue.
Background :
State Budget Process Overview. Under the State
Constitution, the Legislature has the power to appropriate
State funds and make mid-year adjustments to those
appropriations. The annual State budget act is the
Legislature's primary method of authorizing expenses for a
particular fiscal year. Also, under the State
Constitution, the Governor is required to propose a
balanced budget by January 10 for the next fiscal year
(beginning July 1) and the Legislature is required to pass
the annual budget act by June 15. Under current law, the
Governor may also reduce or eliminate specific
appropriation items using his or her "line-item veto" power
and the Legislature may override a veto with a two-thirds
vote in each house. However, once the budget has been
approved by the Legislature and the Governor, current law
provides the Governor with limited authority to reduce
spending during the year without legislative approval.
Budget Vote Requirement. Under the State Constitution,
General Fund appropriations (except appropriations for
public schools), urgency measures, and bills that change
State taxes for the purposes of increasing State revenues
require a two-thirds vote of each house of the Legislature
for passage. Budget trailer bills, which are statutes that
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implement certain budget actions, also require a two-thirds
vote of each house if they are to take effect immediately
under current law.
Proposed Law:
This statute would make the following changes to the
constitution to change the State's budget process:
Budget Vote Threshold. This measure would require 55
percent of the membership concurring for passage of the
budget bill and each budget implementation bill.
Tax Vote Threshold. This measure would remove the
two-thirds vote requirement for tax increases.
One-Time Resources. This measure requires the Governor to
provide an itemized statement of the estimated total state
resources available to meet recommended expenditures and
the amount, if any, of those resources anticipated to be
one-time resources.
Referendum. This measure restricts the budget bill and
budget implementation bills from being subject to
referendum, since the budget bill is no longer an urgency
statute.
Fiscal Effect:
There may be minor absorbable costs incurred by the
Department of Finance to provide additional information on
one-time resources. The indirect fiscal effects of this
measure depend on future actions by the Legislature.
However, this measure could result in increased revenues
since this measure makes it easier to raise revenues.
Source : Author
Support :
California Professional Firefighters
California Faculty Association
California School Employees Association
California Communities United Institute
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Opposed : California Taxpayers' Association
Comments :
1. Supermajority Vote Requirements in Other States.
There are only eight states that have supermajority
vote requirements for the passage of the State
budget. All other states require only a majority
vote for passage of the State budget. The other
states that have supermajority vote requirements for
the budget each have different systems as detailed
below:
a. Arkansas. Three-fourths majority is
required on all appropriations except education,
highways, and paying down state debt.
b. Connecticut. Three-fifths majority is
required for appropriations only if the General
Fund expenditure ceiling is reached. Otherwise,
appropriations require a simple majority.
c. Hawaii. Two-thirds majority is required
for appropriations only if the General Fund
expenditure ceiling is reached. Otherwise,
appropriations require a simple majority.
d. Illinois. A simple majority vote is
required for appropriations until June 1, after
such time a three-fifths majority is required to
pass the budget.
e. Maine. A simple majority vote is
required for all legislation that is non-urgency.
Urgency legislation requires a two-thirds vote.
Therefore, the budget must be passed by April 1
if it is to be implemented with a majority vote.
f. Nebraska. Nebraska's system is similar
to Maine's.
g. Rhode Island. Appropriations require a
two-thirds majority vote.
2. Budget Vote Requirement and Accountability.
Reducing the vote threshold for the State budget
could improve accountability by placing the
responsibility of governance solely on the majority
party and the Governor. This measure also provides
the majority party with the authority to raise
revenues with 55 percent of membership concurring in
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each house of the Legislature.
3. Suggested Amendments. The author indicates that
the intent of this measure is to lower the vote
threshold for both passing the budget and raising
revenue to 55 percent of the membership in each
house of the Legislature. However, the bill as
currently drafted does not specify that raising
revenue would require 55 percent for membership
concurring in each house of the Legislature. If
this is the intent, amendments should be made to
this measure to specify that 55 percent of the
membership in each house of the Legislature is
required to increase revenues.
Section six of this bill is no longer needed as this
measure is no longer in conflict with other
measures. The measures referenced in this bill were
ultimately part of a larger ballot initiative
(Proposition 1A) that failed passage by the voters
in May 2009.
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