Relating to a limitation on the rate of growth in state and local appropriations with the return of over-collected taxpayer money by reducing taxes.
Impact
This legislative proposal is expected to influence state fiscal policy by constraining the growth of government spending relative to taxpayers' capacity to contribute. If enacted, the bill could potentially enforce lower rates of growth for appropriations, thereby limiting how much state and local entities can allocate during fiscal bienniums starting from September 1, 2025. It aims to ensure that any excess taxpayer money collected is returned chiefly through tax reductions, thus emphasizing taxpayer relief amidst considerations for government financing.
Summary
House Bill 44 proposes a limitation on the rate of growth of state and local appropriations, aiming to ensure that this rate does not exceed the average taxpayer's ability to fund government operations. The bill mandates that the rate of growth in all appropriations from various revenue sources, which encompass general revenue and dedicated accounts, aligns with the population growth and inflation rates over the prior three years. The objective is to maintain fiscal responsibility and accountability in state budget management.
Contention
The introduction of HB 44 may spark debates over the balance between necessary government funding and tax relief. Advocates of the bill argue that it promotes smarter financial governance by aligning spending with an economic growth model, helping to prevent excessive governmental expenditure. However, critics may contend that this could inadvertently hinder funding for key public services or necessary programs, particularly in times of economic need. The requirement for a majority vote from the Legislative Budget Board to exceed the stipulations could also lead to legislative gridlock on budgetary decisions, impacting the timely allocation of funds in various essential sectors.
Proposing a constitutional amendment concerning the limitation on the rate of growth in state and local appropriations with the return of over-collected taxpayer money by reducing taxes.
Relating to an annual state budget and legislative budget sessions in even-numbered years and to political contributions made during a legislative session.