Colorado Legislative Council Staff

STATE and LOCAL

CONDITIONAL FISCAL NOTE

TABOR Refund Impact

State General Fund Revenue and Expenditure Impact

Cash Fund Revenue Impact

Local Government Revenue Impact


Drafting Number:

Prime Sponsor(s):

LLS 98-388

Rep. George

Sen. Bishop

Date:

Bill Status:

Fiscal Analyst:

February 3, 1998

House Finance

Harry Zeid (866-4753)

 

TITLE:            CONCERNING STATE REVENUES IN EXCESS OF THE CONSTITUTIONAL LIMITATION ON STATE FISCAL YEAR SPENDING, AND, IN CONNECTION THEREWITH, SUBMITTING A BALLOT QUESTION TO VOTERS STATEWIDE TO AUTHORIZE THE STATE TO ANNUALLY RETAIN AN AMOUNT OF SUCH EXCESS REVENUES NOT TO EXCEED TWO HUNDRED FIFTY MILLION DOLLARS FOR A PERIOD OF FIVE FISCAL YEARS TO BE USED FOR CERTAIN GOVERNMENTAL PURPOSES AND PROVIDING FOR A TEMPORARY STATE INCOME TAX RATE REDUCTION FOR THE PURPOSE OF REFUNDING STATE EXCESS REVENUES THAT VOTERS HAVE NOT AUTHORIZED THE STATE TO RETAIN.


Summary of Legislation


STATE FISCAL IMPACT SUMMARY

FY 1998/99

FY 1999/2000

State Revenues

General Fund (reduction)

State Excess Revenue Fund - Transfer from General Fund


($74,800,000)

250,000,000


($36,100,000)

250,000,000

State Expenditures

General Fund - Transfer to State Excess Revenue Fund

Other Fund


$250,000,000


$250,000,000

FTE Position Change

None

None

Local Government Impact — The bill would allow portions of the excess revenues to be made available for financial assistance to local governments impacted by growth, capital construction for school districts, transportation needs and other local issues.


            This bill would submit a question to the registered electors of the State of Colorado at the next general election in November 1998 to authorize the State Treasurer to annually transfer the lesser of $250 million or the total amount of excess revenues prescribed by Section 20 of Article X of the State Constitution to the State Excess Revenue Fund for FY 1997-98 through FY 2001-02. All interest derived from the deposit and investment of moneys in the fund would be credited to the fund. Moneys in the State Excess Revenue Fund would not be deemed to be appropriations subject to the restriction on state appropriations identified in Section 24-75-201.1, C.R.S.


            Moneys in the State Excess Revenue Fund would be subject to appropriation by the General Assembly and would be limited to the following purposes:

 

          financial assistance to local governments impacted by growth, or to reimburse the General Fund for moneys previously appropriated for that purpose;

          financial assistance to public school districts for capital construction projects that will address immediate safety hazards or health concerns at existing school facilities;

          moneys for capital construction;

          moneys for the Colorado Uninsurable Health Insurance Plan;

          moneys for the Children’s Basic Health Plan;

          moneys to finance public schools that would be in addition to moneys otherwise appropriated by the General Assembly for this purpose;

          moneys for state, county, and municipal multi-modal transportation needs;

          renovation of the State Capitol; and

          moneys to finance interstate water lawsuits, the recovery and protection of native species, the environmental clean-up of abandoned mines, and water storage projects.


            The aggregate amount of moneys appropriated from the State Excess Revenue Fund for any fiscal year could not exceed 60 percent of the principal in the fund at the end of the prior fiscal year plus interest in the fund from the prior fiscal year.


            The bill would require the refunding of state revenues that exceed the excess state revenues that the voters have not authorized the state to retain through a temporary reduction of the state income tax rate. The tax rate necessary for the refund would be determined by the Executive Director of the Department of Revenue.


            The bill would take effect following proclamation by the Governor of the vote of the registered electors at the 1998 general election. Since the bill is conditional upon voter approval, the bill is assessed as having conditional state and local fiscal impact.



State Revenues


            State Expenditures


            The bill would annually transfer the lesser of $250 million or the total amount of excess revenues prescribed by Section 20 of Article X of the State Constitution to the State Excess Revenue Fund for FY 1997-98 through FY 2001-02. Moneys in the State Excess Revenue Fund would be subject to appropriation by the General Assembly for various purposes by the General Assembly. Table 2. identifies the amount of moneys available for appropriation from the State Excess Revenue Fund for FY 1997-98 through FY 2002-03. Interest that would be earned on moneys in the fund is not included in the estimate of the State Excess Revenue Fund balance. The interest earnings in the fund would also be available for appropriation.




Table 2. HB 98-1212 Moneys Available for Appropriation from the State Excess Revenue

Fund and Available for an Income Tax Rate Reduction FY 1997-98 through FY 2002-03

(in millions of dollars)




Fiscal Year

Projected

TABOR

Excess

Revenue

State Excess

Revenue Fund

Principal

Balance

Amount

Available for

Approp.*



Year-End

Balance

Available

for Income Tax Rate Reduction

FY 1997-98

FY 1998-99

FY 1999-00

FY 2000-01

FY 2001-02

FY 2002-03

$324.8

286.1

276.4

280.0

228.6

203.0

n/a

$250.0

350.0

390.0

406.0

391.0

n/a

$150.0

210.0

234.0

243.6

234.6

n/a

$100.0

140.0

156.0

162.4

156.4

n/a

$74.8

36.1

26.4

30.0

n/a

*Funds available for appropriation would be made available for programs in the following fiscal year.



Election Expenditure Impacts (For Informational Purposes Only)


            A General Fund line-item in the 1998-99 Long Appropriations Bill will fund the costs of publicizing any initiative or referendum proposal in newspapers and for printing and distribution of the Blue Book to all electors. The General Assembly spent $291,267 GF for one state-wide ballot proposal on the November, 1995 ballot and $1,042,014 GF for the 12 proposals that appeared on the November, 1996 ballot.


            The 1996 General Election fixed costs for mailing the Blue Book to 1.35 million registered voters was $174,036 for postage and $3,800 for obtaining mailing addresses. These costs will be the same regardless of the number of issues on the ballot. Variable costs included: Spanish translation of $11,215; newspaper publication of $644,828; printing costs of $206,806; and other costs of $1,328. Total costs were $1,042,014 GF. Fixed costs totaled $177,837 and variable costs were $72,015 per ballot issue.


            Based on the costs incurred for the 1996 Blue Book, one ballot issue cost $249,852 to print and mail to the public. The $72,015 of incremental cost would be added for each issue to the basic mailing costs of $177,837.



Local Government Impact


            The bill would allow portions of the excess revenues to be made available for financial assistance to local governments impacted by growth, capital construction for school districts, transportation needs, and other local issues.



Spending Authority


            The fiscal note would imply that no appropriations or spending authority are required in FY 1998-99 to implement the provisions of the bill.



Departments Contacted


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