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Regular Session, 2010
SENATE BILL NO. 463
BY SENATOR MICHOT
FUNDS/FUNDING. Constitutional amendment to authorize limited redirection and transfer
of funds supporting appropriations and allocations from the state general fund and dedicated
funds in certain circumstances. (2/3 CA13s1(A))
A JOINT RESOLUTION1
Proposing to amend Article VII, Section 10(F)(1), (2)(a) and (b) and (4) of the Constitution2
of Louisiana, relative to the expenditure of state funds; to authorize the limited3
redirection and transfer of funds supporting appropriations, allocations, or fund4
balances from the state general fund and dedicated funds, including the5
constitutionally protected or mandated Louisiana Education Quality Trust Fund; to6
be used for other nonmandatory purposes under certain circumstances; to increase7
the adjustments that can be made under certain circumstances; to specify an election8
for submission of the proposition to electors and provide a ballot proposition.9
Section 1. Be it resolved by the Legislature of Louisiana, two-thirds of the members10
elected to each house concurring, that there shall be submitted to the electors of the state, for11
their approval or rejection in the manner provided by law, a proposal to amend Article VII,12
Section 10(F)(1), (2)(a) and (b) and (4) of the Constitution of Louisiana, to read as follows:13
ARTICLE VII14
§10. Expenditure of State Funds15
Section 10.16
* * *17 SB NO. 463
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(F) Projected Deficit. (1) The legislature by law shall establish a procedure1
to determine if appropriations will exceed the official forecast state and federal2
revenues available and an adequate method for adjusting appropriations in order to3
eliminate a projected deficit. Any law establishing a procedure to determine if4
appropriations will exceed the official forecast total state and federal revenues5
available and methods for adjusting appropriations, including any constitutionally6
protected or mandated allocations or appropriations, once enacted, shall not be7
changed except by specific legislative instrument which receives a favorable vote of8
two-thirds of the elected members of each house of the legislature. Notwithstanding9
the provisions of Article III, Section 2 of this constitution, such law may be10
introduced and considered in any regular session of the legislature.11
(2)(a) Notwithstanding any other provision of this constitution to the12
contrary, adjustments to any constitutionally protected or mandated allocations , or13
appropriations, or fund balances, and transfer of monies associated with such14
adjustments, are authorized when state general fund allocations or appropriations15
have been reduced in an aggregate amount equal to at least seven-tenths of one16
percent of the total of such allocations and appropriations for a fiscal year. Such17
adjustments may not exceed five ten percent of the total appropriation, or allocation,18
or fund balance from a fund for the fiscal year. For purposes of this19
Subsubparagraph, reductions to expenditures required by Article VIII, Section 13(B)20
of this constitution shall not exceed one percent and such reductions shall not be21
applicable to instructional activities included within the meaning of instruction22
pursuant to the Minimum Foundation Program formula. Notwithstanding any other23
provisions of this constitution to the contrary, monies transferred as a result of such24
budget adjustments are deemed available for appropriation and expenditure in the25
year of the transfer from one fund to another, but in no event shall the aggregate26
amount of any transfers exceed the amount of the deficit. made available as27
authorized under this Subsubparagraph shall be transferred by the treasurer28
from such fund to the general fund. Monies transferred as a result of the29 SB NO. 463
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budget actions authorized by this Subsubparagraph shall not exceed the total1
projected deficit resulting from reductions in the official forecast and decreases2
in federal financial participation. Any adjustments pursuant to this3
Subsubparagraph in excess of five percent shall not be effective unless approved4
by the legislature by a favorable vote of a majority of the elected members of5
each house. Such approval shall be by mail ballot, as provided by law, if the6
adjustments are made while the legislature is not in session.7
(b) Notwithstanding any other provision of this constitution to the contrary,8
for the purposes of the budget estimate and enactment of the budget for the next9
fiscal year, when the official forecast of recurring revenues for the next fiscal year10
is at least one percent less than the official forecast for the current fiscal year, or if11
a decrease in federal financial participation in state assistance expenditures for12
health or social services programs, including Federal Medical Assistance13
Percentages, creates a projected deficit for the next fiscal year, the following14
procedure may be employed to avoid a budget deficit in the next fiscal year. An15
amount not to exceed five ten percent of the total appropriations or allocations for16
the current fiscal year from any fund established by law or this constitution shall be17
available for expenditure in the next fiscal year for a purpose other than as18
specifically provided by law or this constitution. For the purposes of this19
Subsubparagraph, an amount not to exceed one percent of the current fiscal year20
appropriation for expenditures required by Article VIII, Section 13(B) of this21
constitution shall be available for expenditures for other purposes in the next fiscal22
year. Monies from the Louisiana Education Quality Trust Fund shall be23
available for expenditure as provided in this Subsubparagraph only for higher24
education or elementary and secondary education for instructional purposes.25
Notwithstanding any other provisions of this constitution to the contrary, monies26
made available as authorized under this Subsubparagraph may shall be transferred27
to a by the treasurer from such fund to the general fund. for which revenues have28
been forecast to be less than the revenues in the current fiscal year for such fund.29 SB NO. 463
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Monies transferred as a result of the budget actions authorized by this1
Subsubparagraph are deemed available for appropriation and expenditure, but in no2
event shall the aggregate amount of any such transfers shall not exceed the total3
projected deficit resulting from reductions in the official forecast and decreases4
in federal financial participation. amount of the difference between the official5
forecast for the current fiscal year and the next fiscal year. Any adjustments6
pursuant to this Subsubparagraph in excess of five percent shall not be effective7
unless approved by the legislature by a favorable vote of a majority of the8
elected members of each house. Such approval shall be by mail ballot, as9
provided by law, if the adjustments are made while the legislature is not in10
session.11
* * *12
(4) The provisions of Subparagraphs (1) and (2) of this Paragraph shall not13
be applicable to, nor affect:14
(a) The Bond Security and Redemption Fund or any bonds secured thereby,15
or any other funds pledged as security for bonds or other evidences of indebtedness.16
(b) The allocations provided for by Article VII, Section 4(D) and (E) of this17
constitution.18
(c) The contributions made in accordance with Article X, Section 29(E) of19
this constitution.20
(d) The Louisiana Education Quality Trust Fund as defined in Article VII,21
Section 10.1(A)(1) of this constitution.22
(e) (d) The Millennium Trust as provided in Article VII, Section 10.8 of this23
constitution, except for appropriations from the trust.24
(f) (e) Any monies not required to be deposited in the state treasury as25
provided in Article VII, Section 9 of this constitution.26
Section 2. Be it further resolved that this proposed amendment shall be submitted27
to the electors of the state of Louisiana at the statewide election to be held on November 2,28
2010.29 SB NO. 463
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Section 3. Be it further resolved that on the official ballot to be used at said election1
there shall be printed a proposition, upon which the electors of the state shall be permitted2
to vote FOR or AGAINST, to amend the Constitution of Louisiana, which proposition shall3
read as follows:4
To allow under certain circumstances, and to increase, the limited redirection5
and transfer of funds supporting appropriations, allocations or fund balances,6
from the state general fund and dedicated funds, including the7
constitutionally protected or mandated Louisiana Education Quality Trust8
Fund, to be used for certain other nonmandatory purposes.9
(Article VII, Section 10(F)(1), (2)(a) and (b), and (4))10
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Martha S. Hess.
DIGEST
Present constitution authorizes the legislature to establish a procedure to determine a
projected deficit and a method for adjusting appropriations to eliminate the deficit.
Proposed constitutional amendment authorizes the legislature to establish a procedure to
determine if appropriations will exceed state and federal revenues available.
Present constitution authorizes the governor, with legislative approval, to reduce up to 5%
of appropriations or allocations from the state general fund and dedicated funds in any fiscal
year in which a deficit is projected and reductions of at least seven-tenths of 1% in
appropriations from the state general fund have already occurred. Further provides that such
reductions to the Minimum Foundation Program (MFP) shall be limited to 1% and shall not
be applicable to instructional activities.
Proposed constitutional amendment increases the amount of reductions of appropriations,
allocations from the state general fund and dedicated funds in any fiscal year in which a
deficit is projected and reductions of at least seven-tenths of 1% in appropriations from the
state general fund have already occurred from 5% to 10% and authorizes reductions to be
made to fund balances.
Proposed constitutional amendment provides that monies made available pursuant to
constitutional provision shall be transferred by the treasurer from such fund to the general
fund. Monies transferred as a result of the budget actions shall not exceed the total projected
deficit resulting from reductions in the official forecast and decreases in federal financial
participation.
Proposed constitutional amendment requires any adjustments in excess of 5% not be
effective unless approved by a majority of the elected members of each house of the
legislature. Further requires such approval to be made by mail ballot, as provided by law,
if the adjustments are made while the legislature is not in session.
Present constitution authorizes the legislature to reduce the monies appropriated or allocated
for mandatory expenditures or allocations by up to 5%, making those funds available for SB NO. 463
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other, nonmandatory expenditures if the official revenue forecast for the next year is at least
1% less than for the current year.
Proposed constitutional amendment increases the percentage the legislature is authorized to
reduce the monies appropriated or allocated for mandatory expenditures or allocations from
up to 5% to up to 10%, making those funds available for other, nonmandatory expenditures
if the official revenue forecast for the next year is at least 1% less than for the current year
or if a decrease in federal financial participation in state assistance expenditures for health
or social services programs, including Federal Medical Assistance Percentages, creates a
projected deficit for the next fiscal year.
Proposed constitutional amendment requires any adjustments in excess of 5% not be
effective unless approved by a majority of the elected members of each house of the
legislature. Further requires such approval to be made by mail ballot, as provided by law,
if the adjustments are made while the legislature is not in session.
Present constitution provides that these provisions shall not be applicable to, nor affect (1)
the Bond Security and Redemption Fund or any bonds secured thereby, or any other funds
pledged as security for bonds or evidences of indebtedness; (2) the severance tax and royalty
allocations to parishes (Art. VII, §4(D) and (E)); (3) state retirement contributions; (4) the
Louisiana Education Quality Trust Fund; and (5) the Millennium Trust, except for
appropriations from the trust.
Proposed constitutional amendment removes exception for the Louisiana Education Quality
Trust Fund and provides that monies from the Louisiana Education Quality Trust Fund shall
be available for expenditure as provided in proposed constitutional amendment only for
higher education or elementary and secondary education for instructional purposes.
Specifies submission of the amendment to the voters at the election to be held on November
2, 2010.
(Const. Art. VII, Sec. 10(F)(1), (2)(a) and (b), and (4))