84R1121 JJT-D

By: Perry S.B. No. 137

A BILL TO BE ENTITLED

AN ACT

relating to the maximum rate of growth of appropriations.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Sections 316.001, 316.002, 316.003, 316.004, and 316.006, Government Code, are amended to read as follows:

Sec. 316.001. APPROPRIATIONS LIMIT; RATE OF GROWTH. (a) The amount of appropriations from the state treasury for a fiscal biennium may not exceed the amount determined in accordance with this subchapter.

(b) The maximum rate of growth of appropriations from the state treasury for a fiscal biennium, as compared to the preceding fiscal [in a] biennium, is the lesser of the following rates:

(1) [from state tax revenues not dedicated by the constitution may not exceed] the estimated rate of growth of personal income of this [the] state's residents; or

(2) a rate equal to the sum of:

(A) the estimated biennial rate of growth of this state's population; and

(B) the estimated biennial rate of monetary inflation in this state [economy].

Sec. 316.002. DUTIES OF LEGISLATIVE BUDGET BOARD. (a) Before the Legislative Budget Board submits the budget as prescribed by Section 322.008(c), the board shall determine [establish]:

(1) the estimated rate of growth of personal income of this [the] state's residents [economy] from the current fiscal biennium to the next fiscal biennium, determined as provided by Subsection (b);

(2) a rate equal to the sum of:

(A) the estimated biennial rate of growth of this state's population, determined as provided by Subsection (c); and

(B) the estimated biennial rate of monetary inflation in this state, determined as provided by Subsection (d);

(3) the amount [level] of appropriations for the current fiscal biennium [from state tax revenues not dedicated by the constitution]; and

(4) [(3)] the maximum permissible amount of appropriations of revenue from the state treasury [state tax revenues not dedicated by the constitution that could be appropriated] for the next fiscal biennium [within the limit established] by multiplying the total amount of appropriations for the current fiscal biennium by the sum of one and the maximum rate of growth of appropriations as provided by Section 316.001 [the estimated rate of growth of the state's economy].

(b) The Legislative Budget Board [Except as provided by Subsection (c), the board] shall determine the estimated rate of growth of personal income of this [the] state's residents [economy] by dividing the estimated Texas total personal income for the next fiscal biennium by the estimated Texas total personal income for the current fiscal biennium. Using standard statistical methods, the board shall make the estimate by projecting through the fiscal biennium the estimated Texas total personal income reported by the United States Department of Commerce or its successor in function.

(c) The Legislative Budget Board shall determine the estimated biennial rate of growth of this state's population according to estimates provided by the state demographer. [If a more comprehensive definition of the rate of growth of the state's economy is developed and is approved by the committee established by Section 316.005, the board may use that definition in calculating the limit on appropriations.]

(d) The Legislative Budget Board shall determine the estimated biennial rate of monetary inflation in this state based on the estimated rate of change during the preceding fiscal biennium of the effective consumer price index for this state.

(e) To ensure compliance with Section 22, Article VIII, [Section 22, of the] Texas Constitution, the Legislative Budget Board may not transmit in any form to the governor or the legislature the budget as prescribed by Section 322.008(c) or the general appropriations bill as prescribed by Section 322.008(d) until the maximum permissible amount [limit on the rate of growth] of appropriations for the next fiscal biennium has been adopted as required by this subchapter.

(f) [(e)] In the absence of an action by the Legislative Budget Board to adopt a maximum permissible amount of appropriations for the next fiscal biennium [spending limit] as provided by this section, the maximum permissible amount of appropriations for the next fiscal biennium is [in Subsections (a) and (b), the estimated rate of growth in the state's economy from the current biennium to the next biennium shall be treated as if it were zero, and the amount of state tax revenues not dedicated by the constitution that could be appropriated within the limit established by the estimated rate of growth in the state's economy shall be] the same as the amount [level] of those appropriations for the current fiscal biennium, determined under Subsection (a)(3).

Sec. 316.003. PUBLICATION. Before the Legislative Budget Board approves the items of information required by Section 316.002, the board shall publish in the Texas Register the proposed items of information and a description of the methodology and sources used in the determinations [calculations].

Sec. 316.004. PUBLIC HEARING. Not later than December 1 of each even-numbered year, the Legislative Budget Board shall hold a public hearing to solicit testimony regarding the proposed items of information and the methodology used in making the determinations [calculations] required by Section 316.002.

Sec. 316.006. LIMIT ON BUDGET RECOMMENDATIONS. Unless authorized by majority vote of the members of the board from each house, the Legislative Budget Board budget recommendations relating to the proposed appropriations from the state treasury for the next fiscal biennium [of state tax revenues not dedicated by the constitution] may not exceed the maximum permissible amount of appropriations [limit] adopted by the committee under Section 316.005.

SECTION 2. Section 316.007(a), Government Code, is amended to read as follows:

(a) The Legislative Budget Board shall include in its budget recommendations the proposed maximum permissible amount [limit] of appropriations from the state treasury for the next fiscal biennium [from state tax revenues not dedicated by the constitution].

SECTION 3. Section 316.008(a), Government Code, is amended to read as follows:

(a) Unless the legislature adopts a resolution under Section 22(e), Article VIII, [Section 22(b), of the] Texas Constitution, raising the proposed maximum permissible amount of [limit on] appropriations for the next fiscal biennium, the proposed maximum permissible amount [limit] is binding on the legislature with respect to all appropriations for the next fiscal biennium made from the state treasury [state tax revenues not dedicated by the constitution].

SECTION 4. (a) The changes in law made by this Act apply only in relation to appropriations made for the state fiscal biennium beginning September 1, 2017, and subsequent state fiscal bienniums.

(b) Appropriations for the state fiscal biennium that begins September 1, 2015, are governed by Subchapter A, Chapter 316, Government Code, as that subchapter provided immediately before the effective date of this Act, and the former law is continued in effect for that purpose.

SECTION 5. This Act takes effect on the effective date of the constitutional amendment proposed by the 84th Legislature, Regular Session, 2015, regarding the maximum amount of appropriations for a state fiscal biennium. If that amendment is not approved by the voters, this Act has no effect.