COMMITTEE ON LEGISLATIVE RESEARCH OVERSIGHT DIVISION FISCAL NOTE L.R. No.:4056H.02P Bill No.:Perfected HCS for HJR 91 Subject:General Assembly; Constitutional Amendments Type:Original Date:February 25, 2022Bill Summary:This joint resolution modifies the initiative petition process for amendments to the constitution. FISCAL SUMMARY ESTIMATED NET EFFECT ON GENERAL REVENUE FUNDFUND AFFECTEDFY 2023FY 2024FY 2025 General Revenue* $0 or (More than $7,000,000) $0$0Total Estimated Net Effect on General Revenue $0 or (More than $7,000,000)$0$0 *The potential fiscal impact of “(More than $7,000,000)” would be realized only if a special election were called by the Governor to submit this joint resolution to voters. ESTIMATED NET EFFECT ON OTHER STATE FUNDSFUND AFFECTEDFY 2023FY 2024FY 2025Total Estimated Net Effect on Other State Funds $0$0$0 Numbers within parentheses: () indicate costs or losses. L.R. No. 4056H.02P Bill No. Perfected HCS for HJR 91 Page 2 of February 25, 2022 SAK:LR:OD ESTIMATED NET EFFECT ON FEDERAL FUNDSFUND AFFECTEDFY 2023FY 2024FY 2025Total Estimated Net Effect on All Federal Funds $0$0$0 ESTIMATED NET EFFECT ON FULL TIME EQUIVALENT (FTE)FUND AFFECTEDFY 2023FY 2024FY 2025Total Estimated Net Effect on FTE 000 ☒ Estimated Net Effect (expenditures or reduced revenues) expected to exceed $250,000 in any of the three fiscal years after implementation of the act or at full implementation of the act. ☐ Estimated Net Effect (savings or increased revenues) expected to exceed $250,000 in any of the three fiscal years after implementation of the act or at full implementation of the act. ESTIMATED NET EFFECT ON LOCAL FUNDSFUND AFFECTEDFY 2023FY 2024FY 2025Local Government$0*$0$0 *Transfer out and transfer in net to zero if the Governor calls a special election. L.R. No. 4056H.02P Bill No. Perfected HCS for HJR 91 Page 3 of February 25, 2022 SAK:LR:OD FISCAL ANALYSIS ASSUMPTION Officials from the Office of the Secretary of State (SOS) assume this proposal increases the number of required signatures for a successful initiative petition. The current requirement of 8% (constitutional) or 5% (statutory) of voters from the previous gubernatorial election in six out of eight congressional districts will be about 171,000 or 107,000 signatures respectively for the 2022 petition cycle. The proposed change to require 8% (constitutional) or 5% (statutory) in all districts would increase that minimum number to over 240,000 (constitutional) or 150,000 (statutory), an approximately 40% increase. This increase in signatures would lead to an increase in pages submitted per petition and therefore an increase in processing costs when signatures are submitted for verification. The referendum petition submitted in 2017 contained over 250,000 valid signatures and cost approximately $32,000 in state resources to process for sufficiency, which SOS does with existing staff. Assuming that other petitions achieve a similar proportion of signatures above the minimum requirements, an increase of up to 40% in processing costs could reach or exceed $12,800 per petition expended between FY 2024 and FY 2025, which the agency would absorb. Based on an average amount of four petitions submitted for verification per election cycle, this would result in total increased costs of up to $51,200. This increase does not include resources expended by local election authorities, nor does it include any additional costs that the Secretary of State's Office could incur in order to continue to meet all statutory processing deadlines. Additionally, each year, a number of joint resolutions that would refer to a vote of the people a constitutional amendment and bills that would refer to a vote of the people the statutory issue in the legislation may be considered by the General Assembly. Unless a special election is called for the purpose, Joint Resolutions proposing a constitutional amendment are submitted to a vote of the people at the next general election. Article XII section 2(b) of the Missouri Constitution authorizes the Governor to order a special election for constitutional amendments referred to the people. If a special election is called to submit a Joint Resolution to a vote of the people, section 115.063.2 RSMo requires the state to pay the costs. The cost of the special election has been estimated to be $7 million based on the cost of the 2020 Presidential Preference Primary. The Secretary of State’s office is required to pay for publishing in local newspapers the full text of each statewide ballot measure as directed by Article XII, Section 2(b) of the Missouri Constitution and Section 116.230-116.290, RSMo. Funding for this item is adjusted each year depending upon the election cycle. A new decision item is requested in odd numbered fiscal years and the amount requested is dependent upon the estimated number of ballot measures that will be approved by the General Assembly and the initiative petitions certified for the ballot. In L.R. No. 4056H.02P Bill No. Perfected HCS for HJR 91 Page 4 of February 25, 2022 SAK:LR:OD FY 2014, the General Assembly changed the appropriation so that it was no longer an estimated appropriation. For the FY22 petitions cycle, the SOS estimates publication costs at $70,000 per page. This amount is subject to change based on number of petitions received, length of those petitions and rates charged by newspaper publishers. The Secretary of State’s office will continue to assume, for the purposes of this fiscal note, that it should have the full appropriation authority it needs to meet the publishing requirements. Because these requirements are mandatory, they reserve the right to request funding to meet the cost of their publishing requirements if the Governor and the General Assembly again change the amount or continue to not designate it as an estimated appropriation. Oversight has reflected, in this fiscal note, the state potentially reimbursing local political subdivisions the cost of having this joint resolution voted on during a special election in fiscal year 2023. This reflects the decision made by the Joint Committee on Legislative Research that the cost of the elections should be shown in the fiscal note. The next scheduled statewide primary election is in August 2022 and the next scheduled general election is in November 2022 (both in FY 2023). It is assumed the subject within this proposal could be on one of these ballots; however, it could also be on a special election called for by the Governor (a different date). Therefore, Oversight will reflect a potential election cost reimbursement to local political subdivisions in FY 2023. In response to similar legislation, HJR 65 from 2022, officials from St. Louis City Board of Elections assumedincreased signatory requirements could result in fewer petitions. Fewer petitions could result in decreased staffing and overtime to work petitions leading to fiscal savings. In response to previous legislation, HJR 22 from 2021, officials from the Kansas City Election Board assumed if the proposal becomes law, they would save roughly $10,000 a year for reduced overtime checking petitions. In response to a previous version, officials from the Kansas City Election Board assumed the cost to conduct an election in the Kansas City portion of Jackson County is $625,000, which includes the cost of processing petition signatures. The State is responsible for their pro-rata share based on voter registration. In response to a previous version, officials from the Jackson County Board of Elections, Platte County Board of Elections, and Greene County Clerk’s Office each assumed the proposal will have no fiscal impact on their respective organizations. Officials from the Missouri Senate, Missouri House of RepresentativesSt. Louis County Board of Elections each assume the proposal will have no fiscal impact on their respective L.R. No. 4056H.02P Bill No. Perfected HCS for HJR 91 Page 5 of February 25, 2022 SAK:LR:OD organizations. Oversight does not have any information to the contrary. Therefore, Oversight will reflect a zero impact in the fiscal note for these agencies. Oversight notes that any costs to the state or to local election authorities for implementing this proposal (increased number of signatures for verification) could be offset by fewer petitions that will meet the new higher thresholds and therefore, will result in fewer petitions to process. Oversight only reflects the responses received from state agencies and political subdivisions; however, other local election authorities and county clerks were requested to respond to this proposed legislation but did not. A listing of political subdivisions included in the Missouri Legislative Information System (MOLIS) database is available upon request. House Amendment 1 Officials from the SOS state House Amendment 1 requires no change in fiscal impact from previous response. Oversight notes the SOS assumes House Amendment 1 would not create a material fiscal impact to their office. FISCAL IMPACT – State GovernmentFY 2023 (10 Mo.) FY 2024FY 2025GENERAL REVENUE FUNDTransfer Out – SOS – reimbursement of Local Election Authorities election costs if special election is called for by the Governor $0 or (More than $7,000,000) $0$0 ESTIMATED NET EFFECT ON GENERAL REVENUE FUND $0 or (More than $7,000,000) $0$0 L.R. No. 4056H.02P Bill No. Perfected HCS for HJR 91 Page 6 of February 25, 2022 SAK:LR:OD FISCAL IMPACT – Local GovernmentFY 2023 (10 Mo.) FY 2024FY 2025LOCAL POLITICAL SUBDIVISIONS Transfer In - Local Election Authorities reimbursement of election costs by State for a special election $0 or More than $7,000,000$0$0 Costs - Local Election Authorities cost of a special election if called for by the Governor $0 or (More than $7,000,000)$0$0 ESTIMATED NET EFFECT ON LOCAL POLITICAL SUBDIVISIONS$0$0$0 FISCAL IMPACT – Small Business No direct fiscal impact to small businesses would be expected as a result of this proposal. FISCAL DESCRIPTION Upon voter approval, this proposed Constitutional amendment would require the sponsor(s) of initiative petitions proposing Constitutional amendments or laws to collect signatures in every Congressional district. Sponsors seeking a Constitutional amendment must submit any approved petition to the General Assembly for consideration in a manner similar to a bill. If the General Assembly approves a petition without change, then the sponsor(s) may submit it to the Secretary of State to be placed on the ballot at the next general election. If the General Assembly amends, or does not pass a petition, then the sponsor(s) may decide whether to place the amended version or the original version on the ballot at the next general election. In cases where the General Assembly has approved a petition or when its amended version is submitted, a simple majority vote is required for passage. If a version not approved by the General Assembly is submitted, then a two-thirds majority vote is required; however, initiative proposed amendments repealing existing Constitutional provisions in whole or in part, that were approved prior to December 8, 2022, shall require only a majority vote for passage. Time limits are specified in the amendment and sponsors will be able to submit petitions during either session of the General Assembly prior to the general election occurring every two years in November. This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space. L.R. No. 4056H.02P Bill No. Perfected HCS for HJR 91 Page 7 of February 25, 2022 SAK:LR:OD SOURCES OF INFORMATION Office of the Secretary of State Missouri House of Representatives Missouri Senate Jackson County Board of Elections Platte County Board of Elections St. Louis County Board of Elections Kansas City Election Board St. Louis City Board of Elections Greene County Clerk’s Office Julie MorffRoss StropeDirectorAssistant DirectorFebruary 25, 2022February 25, 2022