First Regular Session Sixty-eighth General Assembly STATE OF COLORADO INTRODUCED LLS NO. 11-0363.01 Jason Gelender SENATE BILL 11-027 SENATE SPONSORSHIP King S., HOUSE SPONSORSHIP (None), Senate Committees House Committees State, Veterans & Military Affairs A BILL FOR AN ACT Concerning the Colorado economic stability fund, and, in connection therewith, creating the fund and specifying the conditions under which moneys must be transferred to and may be expended from the fund. Bill Summary (Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://www.leg.state.co.us/billsummaries.) The bill creates the Colorado economic stability fund (fund), specifies that the principal of the fund shall consist of general fund moneys transferred to the fund, requires fund interest and income to be credited to the fund, and specifically: Requires 10% of any increase in the amount of general fund revenues for a state fiscal year over the amount of general fund revenues for the prior state fiscal year to be transferred to the fund at the end of the state fiscal year unless such a transfer would cause the balance of the fund to exceed 15% of the amount of general fund revenues for the state fiscal year; and Requires moneys to be transferred from the fund to the general fund at the end of a state fiscal year to the extent necessary to prevent the balance of the fund from exceeding 15% of the highest amount of general fund revenues for any of the 4 state fiscal years immediately preceding the state fiscal year. For any given state fiscal year, the bill allows the general assembly to appropriate or transfer up to one-half of the moneys in the fund if: The amount of general fund revenues for the immediately preceding state fiscal year was at least 10% less than the amount of general fund revenues for the next preceding state fiscal year and the general assembly has declared a state fiscal emergency by adopting a joint resolution approved by a two-thirds majority vote of the members of both houses and the governor; or The general assembly has adopted a joint resolution approved by a two-thirds majority vote of the members of both houses and the governor that declares that extraordinary circumstances other than a state fiscal emergency necessitate the appropriation or transfer of fund moneys. The bill allows moneys appropriated or transferred from the fund for any given state fiscal year to be used only: For refunds required by the taxpayer's bill of rights (TABOR), to the extent that such appropriations or transfers do not reduce the fund balance to an amount that is less than 15% of the amount of general fund revenues for the state fiscal year; or To provide funding for programs that were in existence and receiving state funding prior to the beginning of the state fiscal year and that provide vital services determined by the joint budget committee to be necessary to help preserve the public peace, health, or safety. The bill allows the general assembly to appropriate or transfer more than one-half of the moneys in the fund during a state fiscal year if the general assembly authorizes the appropriations or transfers by adopting a separate joint resolution approved by a two-thirds majority vote of the members of both houses and the governor. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Article 75 of title 24, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW PART to read: PART 14 COLORADO ECONOMIC STABILITY FUND 24-75-1401. Colorado economic stability fund - creation - required transfers to fund - use of fund - definitions. (1) As used in this part 14, unless the context otherwise requires: (a) "Stability fund" means the Colorado economic stability fund created in subsection (2) of this section. (b) "Vital services" means services determined by the joint budget committee, by a recorded vote of a majority of its members, to be necessary to help preserve the public peace, health, or safety. (2) The Colorado economic stability fund is hereby created in the state treasury. The principal of the stability fund shall consist of moneys transferred from the general fund to the stability fund pursuant to subsection (3) of this section. Interest and income derived from the deposit and investment of moneys in the stability fund shall be credited to the stability fund and shall not be credited to the general fund or any other fund at the end of any state fiscal year but may be appropriated or transferred from the stability fund as specified in subsections (4) and (5) of this section. (3) Except as otherwise provided in subsection (4) of this section, effective June 30 of any state fiscal year in which the amount of general fund revenues has increased over the amount of general fund revenues for the prior state fiscal year, the state controller shall transfer from the general fund to the stability fund an amount equal to ten percent of the amount by which general fund revenues increased. (4) If a transfer otherwise required by subsection (3) of this section would cause the balance of the stability fund as of the effective date of the transfer to exceed fifteen percent of the amount of general fund revenues for the state fiscal year that includes the effective date, the amount of the transfer shall be reduced to the amount that will cause the balance of the stability fund as of the effective date to equal fifteen percent of the amount of general fund revenues for the state fiscal year. If the required reduction cannot be accomplished solely through a reduction in the amount of the transfer, the state controller shall not make the transfer and shall instead: (a) If the balance of the stability fund as of the effective date of the transfer does not exceed fifteen percent of the highest amount of general fund revenues for any of the four state fiscal years immediately preceding the state fiscal year that includes the effective date, allow the stability fund to remain at its current balance; or (b) If the balance of the stability fund as of the effective date of the transfer exceeds fifteen percent of the highest amount of general fund revenues for any of the four state fiscal years immediately preceding the state fiscal year that includes the effective date, transfer from the stability fund to the general fund, effective June 30 of the state fiscal year, the amount needed to reduce the balance of the stability fund to fifteen percent of the highest amount of general fund revenues for any of the four immediately preceding state fiscal years. (5) For any given state fiscal year, the general assembly may appropriate moneys directly from the stability fund, or cause moneys to be transferred from the stability fund to the general fund in order to make additional moneys available for general fund appropriations or for refunds required by section 20 of article X of the state constitution, subject to the following limitations: (a) The general assembly may only appropriate moneys from, or cause moneys to be transferred from, the stability fund if: (I) (A) The amount of general fund revenues for the immediately preceding state fiscal year was at least ten percent less than the amount of general fund revenues for the next preceding state fiscal year; and (B) The general assembly has declared a state fiscal emergency by adopting a joint resolution approved by a two-thirds majority vote of the members of both houses and the governor; or (II) The general assembly has adopted a joint resolution approved by a two-thirds majority vote of the members of both houses and the governor that declares that extraordinary circumstances other than a state fiscal emergency necessitate the appropriation or transfer of stability fund moneys. (b) Moneys appropriated or transferred from the stability fund may be used only to provide funding for refunds required by section 20 of article X of the state constitution, to the extent that such appropriations or transfers do not reduce the balance of the stability fund to an amount that is less than fifteen percent of the amount of general fund revenues for the state fiscal year, or for programs that: (I) Were in existence and receiving state funding prior to the beginning of the state fiscal year; and (II) Provide vital services. (c) The general assembly may appropriate or transfer a total of no more than one-half of the moneys in the stability fund; except that the general assembly may appropriate or transfer more than one-half of the moneys in the stability fund if the general assembly authorizes such appropriations or transfers by adopting a joint resolution separate from a joint resolution described in sub-subparagraph (B) of subparagraph (I) or subparagraph (II) of paragraph (a) of this subsection (5) approved by a two-thirds majority vote of the members of both houses and the governor. SECTION 2. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.