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ACA-16 State government.(2001-2002)

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ACA16:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2001–2002 REGULAR SESSION

Assembly Constitutional Amendment
No. 16


Introduced  by  Assembly Member Hollingsworth

February 07, 2002


A resolution to propose to the people of the State of California an amendment to the Constitution of the State, by amending Section 20 of Article II thereof, by amending Section 8 of, and adding Section 9 to, Article III thereof, by amending Sections 2, 3, 8, and 10 of, and by amending, repealing, and adding Section 12 to, Article IV thereof, by amending Section 10.5 of, and by amending, repealing, and adding Sections 1, 2, 3, and 8 of, Article XIII B thereof, and by amending Sections 8 and 8.5 of Article XVI thereof, relating to the Legislature.


LEGISLATIVE COUNSEL'S DIGEST


ACA 16, as introduced, Hollingsworth. State government.
(1) The California Constitution requires the California Citizens Compensation Commission, at or before the end of each fiscal year, to adopt a resolution to adjust the annual salary and the medical, dental, insurance, and similar benefits of elected constitutional officers, as defined, including Members of the Legislature. The annual salary and benefits specified in this resolution become effective on and after the first Monday of the next December without further action by the Legislature.
This measure would make the salary and benefits effective on and after the first Monday after January 1 following the adoption of the resolution. The measure would also exclude a Member of the Legislature from the definition of state officer for purposes of those provisions, and instead, would provide that, the annual salary for a Member of the Legislature who begins a term of office on or after January 6, 2003, shall be equal to 1/3 of the salary that was in effect for a Member of the Legislature on December 4, 2000.
(2) The California Constitution provides that the term of office of an Assembly Member or a Senator commences on the 1st Monday in December next following the Member’s election.
This measure would provide that the term of office commences on the 1st Monday after January 1 next following the election and would make conforming changes to constitutional provisions regarding the commencement of a term of office.
(3) The California Constitution requires the Legislature to convene in regular session in December of each even-numbered year, and provides that each regular session adjourns sine die at midnight on November 30 of the following even-numbered year.
This measure instead would require the Legislature to convene in regular session on the 1st Monday after January 1 of each odd-numbered year and would provide that each session shall adjourn sine die at midnight on December 31 of the following even-numbered year. The measure would authorize the Legislature to meet in regular session only for a period of 90 calendar days commencing on the 1st Monday after January 1. The measure would provide that, after the date the Legislature is required to adjourn in each odd-numbered year, it may reconvene for one additional period of 5 or fewer calendar days to consider bills vetoed or items of appropriation eliminated or reduced by the Governor.
(4) Under the California Constitution, at regular sessions no bill other than the budget bill may be heard or acted on by committee until the 31st day after the bill is introduced, except upon a 3/4 vote of each house of the Legislature.
This measure would shorten the time period for a committee hearing or action on the bill until the 7th day after the bill is introduced, except upon a 3/4 vote of the Legislature.
(5) Under the California Constitution, except as specified, a bill passed by the Legislature on or before the date the Legislature adjourns for a joint recess in the 1st year of the biennium of the legislative session, or on or before September 1 of the 2nd calendar year of that biennium, and in the possession of the Governor on or after that date, becomes a statute unless returned by the Governor within 30 days.
This measure, instead, would provide that a bill passed by the Legislature on or before the date the Legislature adjourns in the 1st year of the biennium, and in the possession of the Governor on or after that date, becomes a statute unless returned by the Governor within 30 days. The measure would make other conforming constitutional changes.
(6) The California Constitution requires the Governor, within the first 10 days of each calendar year, to submit to the Legislature, a budget for the ensuing fiscal year containing itemized statements for recommended state expenditures and estimated state revenues and requires the Legislature to pass the budget bill by midnight on June 15 of each year.
This bill, instead, with regard to the budget and budget bills for fiscal periods commencing on or after July 1, 2003, would require the Governor to submit, within the first 10 days of each odd-numbered year, a budget for the following 2 fiscal years and would require the Legislature to pass the budget bill by midnight on April 15 of each odd-numbered year.
(7) Existing constitutional provisions prohibit the annual appropriations subject to limitation, as defined, of the state government or an entity of local government from exceeding its annual appropriations limit and provide for annual adjustments in that limit based on changes in the cost of living and population, calculated in a specified manner.
This measure, beginning with the fiscal period commencing July 1, 2003, would instead provide for an appropriations limit applicable for a 2-year fiscal period. Existing annual appropriations limit provisions that apply to local government would not be affected by this measure. The measure would make conforming changes in constitutional law.
(8) Existing constitutional provisions provide that from all state revenues, there shall be set apart the moneys to be applied for support of the public school system and public institutions of higher education. The California Constitution contains a formula, based on figures from prior fiscal years, to determine the amount of moneys to be applied by the state for the support of school districts and community colleges.
This bill would provide that for the fiscal period commencing July 1, 2003, and for each fiscal period thereafter, “fiscal year” as used in these provisions shall be deemed to refer to one of the two 12-month periods from July 1 to June 30, inclusive, that comprise a collectively a two-year period, as provided. The bill would make other conforming changes in constitutional law.
Vote: 2/3   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

Resolved by the Assembly, the Senate concurring, That the Legislature of the State of California at its 2001–02 Regular Session commencing on the fourth day of December 2000, two-thirds of the membership of each house concurring, hereby proposes to the people of the State of California that the Constitution of the State be amended as follows:

First

 That Section 20 of Article II is amended to read:

SEC. 20.
 Terms of elective offices provided for by this Constitution, other than Members of the Legislature, commence on the first Monday after January 1 following election. The election shall be held in the last even-numbered year before the term expires.

Second

 That Section 8 of Article III is amended to read:

SEC. 8.
 (a) The California Citizens Compensation Commission is hereby created and shall consist of seven members appointed by the Governor. The commission shall establish the annual salary and the medical, dental, insurance, and other similar benefits of state officers.
(b) The commission shall consist of the following persons:
(1) Three public members, one of whom has expertise in the area of compensation, such as an economist, market researcher, or personnel manager; one of whom is a member of a nonprofit public interest organization; and one of whom is representative of the general population and may include, among others, a retiree, homemaker, or person of median income. No person appointed pursuant to this paragraph may, during the 12 months prior to his or her appointment, have held public office, either elective or appointive, have been a candidate for elective public office, or have been a lobbyist, as defined by the Political Reform Act of 1974.
(2) Two members who have experience in the business community, one of whom is an executive of a corporation incorporated in this State which that ranks among the largest private sector employers in the State based on the number of employees employed by the corporation in this State and one of whom is an owner of a small business in this State.
(3) Two members, each of whom is an officer or member of a labor organization.
(c) The Governor shall strive insofar as practicable to provide a balanced representation of the geographic, gender, racial, and ethnic diversity of the State in appointing commission members.
(d) The Governor shall appoint commission members and designate a chairperson for the commission not later than 30 days after the effective date of this section. The terms of two of the initial appointees shall expire on December 31, 1992, two on December 31, 1994, and three on December 31, 1996, as determined by the Governor. Thereafter, the term of each member shall be six years. Within 15 days of any vacancy, the Governor shall appoint a person to serve the unexpired portion of the term.
(e) No current or former officer or employee of this State is eligible for appointment to the commission.
(f) Public notice shall be given of all meetings of the commission, and the meetings shall be open to the public.
(g) On or before December 3, 1990, the commission shall, by a single resolution adopted by a majority of the membership of the commission, establish the annual salary and the medical, dental, insurance, and other similar benefits of state officers. The annual salary and benefits specified in that resolution shall be effective on and after December 3, 1990.
Thereafter, at or before the end of each fiscal year, the commission shall, by a single resolution adopted by a majority of the membership of the commission, adjust the annual salary and the medical, dental, insurance, and other similar benefits of state officers. The annual salary and benefits specified in the resolution shall be effective on and after the first Monday of the next December after January 1 following adoption of the resolution.
(h) In establishing or adjusting the annual salary and the medical, dental, insurance, and other similar benefits, the commission shall consider all of the following:
(1) The amount of time directly or indirectly related to the performance of the duties, functions, and services of a state officer.
(2) The amount of the annual salary and the medical, dental, insurance, and other similar benefits for other elected and appointed officers and officials in this State with comparable responsibilities, the judiciary, and, to the extent practicable, the private sector, recognizing, however, that state officers do not receive, and do not expect to receive, compensation at the same levels as individuals in the private sector with comparable experience and responsibilities.
(3) The responsibility and scope of authority of the entity in which the state officer serves.
(i) Until a resolution establishing or adjusting the annual salary and the medical, dental, insurance, and other similar benefits for state officers takes effect, each state officer shall continue to receive the same annual salary and the medical, dental, insurance, and other similar benefits received previously.
(j) All commission members shall receive their actual and necessary expenses, including travel expenses, incurred in the performance of their duties. Each member shall be compensated at the same rate as members, other than the chairperson, of the Fair Political Practices Commission, or its successor, for each day engaged in official duties, not to exceed 45 days per year.
(k) It is the intent of the Legislature that the creation of the commission should not generate new state costs for staff and services. The Department of Personnel Administration, the Board of Administration of the Public Employees’ Retirement System, or other appropriate agencies, or their successors, shall furnish, from existing resources, staff and services to the commission as needed for the performance of its duties.
(l) “State officer,” as used in this section, means the Governor, Lieutenant Governor, Attorney General, Controller, Insurance Commissioner, Secretary of State, Superintendent of Public Instruction, Treasurer, and member of the State Board of Equalization, and but does not mean a Member of the Legislature.

Third

 That Section 9 is added to Article III to read:

SEC. 9.
 (a) The annual salary for a Member of the Legislature who began his or her term of office prior to January 6, 2003, shall be equal to the annual salary that is in effect for a Member of the Legislature on the date this section is adopted.
(b) Notwithstanding subdivision (a) of Section 4, the annual salary for a Member of the Legislature who begins a term of office on or after January 6, 2003, shall be equal to one-third of the annual salary that was in effect for a Member of the Legislature on December 4, 2000.
(c) A Member of the Legislature shall receive the same level of medical, dental, insurance, and other similar benefits as were in effect for a Member of the Legislature on the date this section is adopted.

Fourth

 That Section 2 of Article IV is amended to read:

SEC. 2.
 (a) The Senate has a membership of 40 Senators elected for 4-year four-year terms, 20 to begin every 2 two years. No Senator may serve more than 2 two terms.
The Assembly has a membership of 80 members elected for 2-year two-year terms. No member of the Assembly may serve more than 3 three terms.
Their terms shall commence on the first Monday in December after January 1 next following their election.
(b) Election of members of the Assembly shall be on the first Tuesday after the first Monday in November of even-numbered years unless otherwise prescribed by the Legislature. Senators shall be elected at the same time and places as members of the Assembly.
(c) A person is ineligible to be a member of the Legislature unless the person is an elector and has been a resident of the legislative district for one year, and a citizen of the United States and a resident of California for 3 three years, immediately preceding the election.
(d) When a vacancy occurs in the Legislature the Governor immediately shall call an election to fill the vacancy.

Fifth

 That Section 3 of Article IV is amended to read:

SEC. 3.
 (a) The Legislature shall convene in regular session at noon on the first Monday in December following January 1 of each even-numbered odd-numbered year and each house shall immediately organize. The Legislature may meet in regular session only for a period of 90 calendar days, not including Saturdays or Sundays, commencing on the first Monday after January 1.
(b) After the date the Legislature is required by subdivision (a) to adjourn in each odd-numbered year, it may reconvene for one additional period of five or fewer calendar days to consider bills vetoed or items of appropriation eliminated or reduced by the Governor. Each session of the Legislature shall adjourn sine die by operation of the Constitution at midnight on November 30 December 31 of the following even-numbered year.

(b)

(c) On extraordinary occasions the Governor by proclamation may cause the Legislature to assemble in special session. When so assembled it has power to legislate only on subjects specified in the proclamation, but may provide for expenses and other matters incidental to the session.

Sixth

 That Section 8 of Article IV is amended to read:

SEC. 8.
 (a) At regular sessions no bill other than the budget bill may be heard or acted on by committee or either house of the Legislature until the 31st seventh day after the bill is introduced unless the house dispenses with this requirement by rollcall vote entered in the journal, three fourths three-fourths of the membership concurring.
(b) The Legislature may make no law except by statute and may enact no statute except by bill. No bill may be passed unless it is read by title on 3 three days in each house except that the house may dispense with this requirement by rollcall vote entered in the journal, two thirds two-thirds of the membership concurring. No bill may be passed until the bill with amendments has been printed and distributed to the members. No bill may be passed unless, by rollcall vote entered in the journal, a majority of the membership of each house concurs.
(c) (1) Except as provided in paragraphs (2) and (3) of this subdivision, a statute enacted at a regular session shall go into effect on January 1 next following a 90-day period from the date of enactment of the statute and a statute enacted at a special session shall go into effect on the 91st day after adjournment of the special session at which the bill was passed.
(2) A statute, other than a statute establishing or changing boundaries of any legislative, congressional, or other election district, enacted by a bill passed by the Legislature on or before the date the Legislature adjourns for a joint recess to reconvene in the second calendar year of the biennium of the legislative regular session, and in the possession of the Governor after that date, shall go into effect on January 1 next following the enactment date of the statute unless, before January 1, a copy of a referendum petition affecting the statute is submitted to the Attorney General pursuant to subdivision (d) of Section 10 of Article II, in which event the statute shall go into effect on the 91st day after the enactment date unless the petition has been presented to the Secretary of State pursuant to subdivision (b) of Section 9 of Article II.
(3) Statutes calling elections, statutes providing for tax levies or appropriations for the usual current expenses of the State, and urgency statutes shall go into effect immediately upon their enactment.
(d) Urgency statutes are those necessary for immediate preservation of the public peace, health, or safety. A statement of facts constituting the necessity shall be set forth in one section of the bill. In each house the section and the bill shall be passed separately, each by rollcall vote entered in the journal, two thirds two-thirds of the membership concurring. An urgency statute may not create or abolish any office or, change the salary, term, or duties of any office, or grant any franchise or special privilege, or create any vested right or interest.

Seventh

 That Section 10 of Article IV is amended to read:

SEC. 10.
 (a) Each bill passed by the Legislature shall be presented to the Governor. It becomes a statute if it is signed by the Governor. The Governor may veto it by returning it with any objections to the house of origin, which shall enter the objections in the journal and proceed to reconsider it. If each house then passes the bill by rollcall vote entered in the journal, two thirds two-thirds of the membership concurring, it becomes a statute.
(b) (1) Any bill, other than a bill which that would establish or change boundaries of any legislative, congressional, or other election district, passed by the Legislature on or before the date the Legislature adjourns for a joint recess to reconvene in the second calendar year of the biennium of the legislative regular session, and in the possession of the Governor after that date, that is not returned within 30 days after that date, becomes a statute.
(2) Any bill passed by the Legislature before September 1 of the second calendar year of the biennium of the legislative session and in the possession of the Governor on or after September 1 that is not returned on or before September 30 of that year becomes a statute.
(3)Any other bill presented to the Governor that is not returned within 12 days becomes a statute.

(4)

(3) If the Legislature by adjournment of a special session prevents the return of a bill with the veto message, the bill becomes a statute unless the Governor vetoes the bill within 12 days after it is presented by depositing it and the veto message in the office of the Secretary of State.

(5)

(4) If the 12th day of the period within which the Governor is required to perform an act pursuant to paragraph (3) (2) or (4) (3) of this subdivision is a Saturday, Sunday, or holiday, the period is extended to the next day that is not a Saturday, Sunday, or holiday.
(c) Any bill introduced during the first year of the biennium of the legislative session that has not been passed by the house of origin by January 31 of the second calendar year of the biennium may no longer be acted on by the house. No bill may be passed by either house on or after September 1 of an even-numbered year except statutes calling elections, statutes providing for tax levies or appropriations for the usual current expenses of the State, and urgency statutes, and bills passed after being vetoed by the Governor.

(d)The Legislature may not present any bill to the Governor after November 15 of the second calendar year of the biennium of the legislative session.

(e)The Governor may reduce or eliminate one or more items of appropriation while approving other portions of a bill. The Governor shall append to the bill a statement of the items reduced or eliminated with the reasons for the action. The Governor shall transmit to the house originating the bill a copy of the statement and reasons. Items reduced or eliminated shall be separately reconsidered and may be passed over the Governor’s veto in the same manner as bills.

Eighth

 That Section 12 of Article IV is amended to read:

SEC. 12.
 (a) Within the first 10 days of each calendar year, the Governor shall submit to the Legislature, with an explanatory message, a budget for the ensuing fiscal year containing itemized statements for recommended state expenditures and estimated state revenues. If recommended expenditures exceed estimated revenues, the Governor shall recommend the sources from which the additional revenues should be provided.
(b) The Governor and the Governor-elect may require a state agency, officer or employee to furnish whatever information is deemed necessary to prepare the budget.
(c) The budget shall be accompanied by a budget bill itemizing recommended expenditures. The bill shall be introduced immediately in each house by the persons chairing the committees that consider appropriations. The Legislature shall pass the budget bill by midnight on June 15 of each year. Until the budget bill has been enacted, the Legislature shall may not send to the Governor for consideration any bill appropriating funds for expenditure during the fiscal year for which the budget bill is to be enacted, except emergency bills recommended by the Governor or appropriations for the salaries and expenses of the Legislature.
(d) No bill except the budget bill may contain more than one item of appropriation, and that for one certain, expressed purpose. Appropriations from the General Fund of the State, except appropriations for the public schools, are void unless passed in each house by rollcall vote entered in the journal, two thirds two-thirds of the membership concurring.
(e) The Legislature may control the submission, approval, and enforcement of budgets and the filing of claims for all state agencies.
(f) This section does not apply to the budget or budget bill for any fiscal period commencing on or after July 1, 2003. This section shall remain in effect only until July 1, 2003, and as of that date is repealed.

Ninth

 That Section 12 is added to Article IV to read:

SEC. 12.
 (a) Within the first 10 days of each odd-numbered calendar year, the Governor shall submit to the Legislature, with an explanatory message, a budget for the two-year fiscal period commencing on the ensuing July 1, containing itemized statements for recommended state expenditures and estimated state revenues. If recommended expenditures exceed estimated revenues, the Governor shall recommend the sources from which the additional revenues should be provided.
(b) The Governor and the Governor-elect may require a state agency, officer, or employee to furnish whatever information is deemed necessary to prepare the budget.
(c) The budget shall be accompanied by a budget bill itemizing recommended expenditures. The bill shall be introduced immediately in each house by the persons chairing the committees that consider appropriations. The Legislature shall pass the budget bill by midnight on April 15 of each odd-numbered year. Until the budget bill has been enacted, the Legislature may not send to the Governor for consideration any bill appropriating funds for expenditure during the fiscal years for which the budget bill is to be enacted, except emergency bills recommended by the Governor or appropriations for the salaries and expenses of the Legislature.
(d) No bill except the budget bill may contain more than one item of appropriation, and that for one certain, expressed purpose. Appropriations from the General Fund of the State, except appropriations for the public schools, are void unless passed in each house by rollcall vote entered in the journal, two-thirds of the membership concurring.
(e) The Legislature may control the submission, approval, and enforcement of budgets and the filing of claims for all state agencies.
(f) This section applies only to the budget and budget bill for fiscal periods commencing on or after July 1, 2003.

Tenth

 That Section 1 of Article XIII B thereof is amended to read:

SECTION 1.
 (a) The total annual appropriations subject to limitation of the State and of each local government shall not exceed the appropriations limit of the entity of government for the prior year adjusted for the change in the cost of living and the change in population, except as otherwise provided in this article.
(b) This section does not apply to any fiscal period commencing on or after July 1, 2003. This section shall remain in effect only until July 1, 2003, and as of that date is repealed.

Eleventh

 That Section 1 is added to Article XIII B thereof, to read:

SECTION 1.
 (a) The total appropriations of the State for a two-year fiscal period, as specified in Section 12.1 of Article IV, that are subject to limitation shall not exceed the appropriations limit of the State for the prior two-year fiscal period adjusted for the change in the cost of living and the change in population, except as otherwise provided in this article.
(b) The total annual appropriations subject to limitation of each local government shall not exceed the appropriations limit of the entity of government for the prior year adjusted for the change in the cost of living and the change in population, except as otherwise provided in this article.
(c) This section applies only to fiscal periods commencing on or after July 1, 2003.

Twelfth

 That Section 2 of Article XIII B thereof is amended to read:

SEC. 2.
 (a) (1) Fifty percent of all revenues received by the State in a fiscal year and in the fiscal year immediately following it in excess of the amount which that may be appropriated by the State in compliance with this article during that fiscal year and the fiscal year immediately following it shall be transferred and allocated, from a fund established for that purpose, pursuant to Section 8.5 of Article XVI.
(2) Fifty percent of all revenues received by the State in a fiscal year and in the fiscal year immediately following it in excess of the amount which that may be appropriated by the State in compliance with this article during that fiscal year and the fiscal year immediately following it shall be returned by a revision of tax rates or fee schedules within the next two subsequent fiscal years.
(b) All revenues received by an entity of government, other than the State, in a fiscal year and in the fiscal year immediately following it in excess of the amount which that may be appropriated by the entity in compliance with this article during that fiscal year and the fiscal year immediately following it shall be returned by a revision of tax rates or fee schedules within the next two subsequent fiscal years.
(c) This section does not apply to any fiscal period commencing on or after July 1, 2003. This section shall remain in effect only until July 1, 2003, and as of that date is repealed.

Thirteenth

 That Section 2 is added to Article XIII B thereof, to read:

SEC. 2.
 (a) (1) Fifty percent of all revenues received by the State in a two-year fiscal period in excess of the amount that may be appropriated by the State in compliance with this article during that period shall be transferred and allocated, from a fund established for that purpose, pursuant to Section 8.5 of Article XVI.
(2) Fifty percent of all revenues received by the State in a two-year fiscal period in excess of the amount that may be appropriated by the State in compliance with this article during that period shall be returned by a revision of tax rates or fee schedules within the next fiscal period.
(b) All revenues received by an entity of government, other than the State, in a fiscal year and in the fiscal year immediately following it in excess of the amount that may be appropriated by the entity in compliance with this article during that fiscal year and the fiscal year immediately following it shall be returned by a revision of tax rates or fee schedules within the next two subsequent fiscal years.
(c) This section applies only to fiscal periods commencing on or after July 1, 2003.

Fourteenth

 That Section 3 of Article XIII B thereof is amended to read:

SEC. 3.
 The appropriations limit for any fiscal year pursuant to Sec. Section 1 shall be adjusted as follows:
(a) In the event that the financial responsibility of providing services is transferred, in whole or in part, whether by annexation, incorporation or otherwise, from one entity of government to another, then, for the year in which such the transfer becomes effective, the appropriations limit of the transferee entity shall be increased by such reasonable amount as the said affected entities shall mutually agree and the appropriations limit of the transferor entity shall be decreased by the same amount.
(b) In the event that the financial responsibility of providing services is transferred, in whole or in part, from an entity of government to a private entity, or the financial source for the provision of services is transferred, in whole or in part, from other revenues of an entity of government, to regulatory licenses, user charges or user fees, then, for the year of such that transfer, the appropriations limit of such the affected entity of government shall be decreased accordingly.
(c) (1) In the event an emergency is declared by the legislative body of an entity of government, the appropriations limit of the affected entity of government may be exceeded, provided that the appropriations limits in the following three years are reduced accordingly to prevent an aggregate increase in appropriations resulting from the emergency.
(2) In the event an emergency is declared by the Governor, appropriations approved by a two-thirds vote of the legislative body of an affected entity of government to an emergency account for expenditures relating to that emergency shall not constitute appropriations subject to limitation. As used in this paragraph, “emergency” means the existence, as declared by the Governor, of conditions of disaster or of extreme peril to the safety of persons and property within the State, or parts thereof, caused by such conditions as attack or probable or imminent attack by an enemy of the United States, fire, flood, drought, storm, civil disorder, earthquake, or volcanic eruption.
(d) This section does not apply to any fiscal period commencing on or after July 1, 2003. This section shall remain in effect only until July 1, 2003, and as of that date is repealed.

Fifteenth

 That Section 3 is added to Article XIII B thereof, to read:

SEC. 3.
 The appropriations limit for any two-year fiscal period, in the case of the State, or for one fiscal year, in the case of local government, pursuant to Section 1 shall be adjusted as follows:
(a) In the event that the financial responsibility of providing services is transferred, in whole or in part, whether by annexation, incorporation or otherwise, from one entity of government to another, then, for the period in which the transfer becomes effective, the appropriations limit of the transferee entity shall be increased by such reasonable amount as the affected entities mutually shall agree and the appropriations limit of the transferor entity shall be decreased by the same amount.
(b) In the event that the financial responsibility of providing services is transferred, in whole or in part, from an entity of government to a private entity, or the financial source for the provision of services is transferred, in whole or in part, from other revenues of an entity of government, to regulatory licenses, user charges or user fees, then, for the year of that transfer, the appropriations limit of the affected entity of government shall be decreased accordingly.
(c) (1) In the event an emergency is declared by the legislative body of an entity of government, the appropriations limit of the affected entity of government may be exceeded, provided that the appropriations limits in the following two fiscal periods, in the case of the State, or three fiscal years, in the case of local government, are reduced accordingly to prevent an aggregate increase in appropriations resulting from the emergency.
(2) In the event an emergency is declared by the Governor, appropriations approved by a two-thirds vote of the legislative body of an affected entity of government to an emergency account for expenditures relating to that emergency shall not constitute appropriations subject to limitation. As used in this paragraph, “emergency” means the existence, as declared by the Governor, of conditions of disaster or of extreme peril to the safety of persons and property within the State, or parts thereof, caused by such conditions as attack or probable or imminent attack by an enemy of the United States, fire, flood, drought, storm, civil disorder, earthquake, or volcanic eruption.
This section applies only to fiscal periods commencing on or after July 1, 2003.

Sixteenth

 That Section 8 of Article XIII B thereof is amended to read:

SEC. 8.
 As used in this article and except as otherwise expressly provided herein:
(a) “Appropriations subject to limitation” of the State means any authorization to expend during a fiscal year the proceeds of taxes levied by or for the State, exclusive of State subventions for the use and operation of local government (other than subventions made pursuant to Section 6) and further exclusive of refunds of taxes, benefit payments from retirement, unemployment insurance, and disability insurance funds.
(b) “Appropriations subject to limitation” of an entity of local government means any authorization to expend during a fiscal year the proceeds of taxes levied by or for that entity and the proceeds of State subventions to that entity (other than subventions made pursuant to Section 6) exclusive of refunds of taxes.
(c) “Proceeds of taxes” shall include, but not be restricted to, all tax revenues and the proceeds to an entity of government, from (1) regulatory licenses, user charges, and user fees to the extent that those proceeds exceed the costs reasonably borne by that entity in providing the regulation, product, or service, and (2) the investment of tax revenues. With respect to any local government, “proceeds of taxes” shall include subventions received from the State, other than pursuant to Section 6, and, with respect to the State, proceeds of taxes shall exclude such these subventions.
(d) “Local government” means any city, county, city and county, school district, special district, authority, or other political subdivision of or within the State.
(e) (1) “Change in the cost of living” for the State, a school district, or a community college district means the percentage change in California per capita personal income from the preceding year.
(2) “Change in the cost of living” for an entity of local government, other than a school district or a community college district, shall be either (A) the percentage change in California per capita personal income from the preceding year, or (B) the percentage change in the local assessment roll from the preceding year for the jurisdiction due to the addition of local nonresidential new construction. Each entity of local government shall select its change in the cost of living pursuant to this paragraph annually by a recorded vote of the entity’s governing body.
(f) “Change in population” of any entity of government, other than the State, a school district, or a community college district, shall be determined by a method prescribed by the Legislature.
“Change in population” of a school district or a community college district shall be the percentage change in the average daily attendance of the school district or the number of full-time equivalent students of the community college district from the preceding fiscal year, as determined by a method prescribed by the Legislature.
“Change in population” of the State shall be determined by adding (1) the percentage change in the State’s population multiplied by the percentage of the State’s budget in the prior fiscal year that is expended for other than educational purposes for kindergarten and grades one to 12, inclusive, and the community colleges, and (2) the percentage change in the total statewide average daily attendance in kindergarten and grades one to 12, inclusive, and the number of full-time equivalent students in the community colleges, multiplied by the percentage of the State’s budget in the prior fiscal year that is expended for educational purposes for kindergarten and grades one to 12, inclusive, and the community colleges.
Any determination of population pursuant to this subdivision, other than that measured by average daily attendance or the number of full-time equivalent students, shall be revised, as necessary, to reflect the periodic census conducted by the United States Department of Commerce, or successor department.
(g) “Debt service” means appropriations required to pay the cost of interest and redemption charges, including the funding of any reserve or sinking fund required in connection therewith, on indebtedness existing or legally authorized as of January 1, 1979, or on bonded indebtedness thereafter approved according to law by a vote of the electors of the issuing entity voting in an election for that purpose.
(h) The “appropriations limit” of each entity of government for each fiscal year is that amount which that total annual appropriations subject to limitation may not exceed under Sections 1 and 3. However, the “appropriations limit” of each entity of government for the 1978–79 fiscal year 1978–79 is the total of the appropriations subject to limitation of the entity for that fiscal year. For the 1978–79 fiscal year 1978–79, State subventions to local governments, exclusive of federal grants, are deemed to have been derived from the proceeds of State taxes.
(i) Except as otherwise provided in Section 5, “appropriations subject to limitation” do not include local agency loan funds or indebtedness funds, or investment (or authorizations to invest) funds of the State, or of an entity of local government in accounts at banks or savings and loan associations or in liquid securities.
This section does not apply to any fiscal period commencing on or after July 1, 2003. This section shall remain in effect only until July 1, 2003, and as of that date is repealed.

Seventeenth

 That Section 8 is added to Article XIII B thereof, to read:

SEC. 8.
 As used in this article, and except as otherwise expressly provided herein:
(a) “Appropriations subject to limitation” of the State means any authorization to expend during a two-year fiscal period the proceeds of taxes levied by or for the State, exclusive of state subventions for the use and operation of local government (other than subventions made pursuant to Section 6) and further exclusive of refunds of taxes, benefit payments from retirement, unemployment insurance, and disability insurance funds.
(b) “Appropriations subject to limitation” of an entity of local government means any authorization to expend during one fiscal year the proceeds of taxes levied by or for that entity and the proceeds of state subventions to that entity (other than subventions made pursuant to Section 6) exclusive of refunds of taxes.
(c) “Proceeds of taxes” shall include, but not be restricted to, all tax revenues and the proceeds to an entity of government, from (1) regulatory licenses, user charges, and user fees to the extent that those proceeds exceed the costs reasonably borne by that entity in providing the regulation, product, or service, and (2) the investment of tax revenues. With respect to any local government, “proceeds of taxes” shall include subventions received from the State, other than pursuant to Section 6, and, with respect to the State, proceeds of taxes shall exclude these subventions.
(d) “Local government” means any city, county, city and county, school district, special district, authority, or other political subdivision of or within the State.
(e) (1) “Change in the cost of living” for the State, a school district, or a community college district means the percentage change in California per capita personal income from the preceding two-year fiscal period, in the case of the State, or one fiscal year, in the case of a school district or community college district.
(2) “Change in the cost of living” for an entity of local government, other than a school district or a community college district, shall be either (A) the percentage change in California per capita personal income from the preceding year, or (B) the percentage change in the local assessment roll from the preceding year for the jurisdiction due to the addition of local nonresidential new construction. Each entity of local government shall select its change in the cost of living pursuant to this paragraph annually by a recorded vote of the entity’s governing body.
(f) “Change in population” of any entity of government, other than the State, a school district, or a community college district, shall be determined by a method prescribed by the Legislature.
“Change in population” of a school district or a community college district shall be the percentage change in the average daily attendance of the school district or the number of full-time equivalent students of the community college district from the preceding fiscal year, as determined by a method prescribed by the Legislature.
“Change in population” of the State shall be determined by adding (1) the percentage change in the State’s population multiplied by the percentage of the State’s budget in the prior two-year fiscal period that is expended for other than educational purposes for kindergarten and grades one to 12, inclusive, and the community colleges, and (2) the percentage change in the total statewide average daily attendance in kindergarten and grades one to 12, inclusive, and the number of full-time equivalent students in the community colleges, multiplied by the percentage of the State’s budget in the prior two-year fiscal period that is expended for educational purposes for kindergarten and grades one to 12, inclusive, and the community colleges.
Any determination of population pursuant to this subdivision, other than that measured by average daily attendance or the number of full-time equivalent students, shall be revised, as necessary, to reflect the periodic census conducted by the United States Department of Commerce, or successor department.
(g) “Debt service” means appropriations required to pay the cost of interest and redemption charges, including the funding of any reserve or sinking fund required in connection therewith, on indebtedness existing or legally authorized as of January 1, 1979, or on bonded indebtedness thereafter approved according to law by a vote of the electors of the issuing entity voting in an election for that purpose.
(h) The “appropriations limit” of each entity of government for each fiscal period, as appropriate, is that amount that total appropriations subject to limitation may not exceed under Sections 1 and 3. However, the “appropriations limit” of each entity of government for the 1978–79 fiscal year is the total of the appropriations subject to limitation of the entity for that fiscal year. For the 1978–79 fiscal year, state subventions to local governments, exclusive of federal grants, are deemed to have been derived from the proceeds of state taxes.
(i) Except as otherwise provided in Section 5, “appropriations subject to limitation” do not include local agency loan funds or indebtedness funds, or investment (or authorizations to invest) funds of the State, or of an entity of local government in accounts at banks or savings and loan associations or in liquid securities.
This section applies only to fiscal periods commencing on or after July 1, 2003.

Eighteenth

 That Section 10.5 of Article XIII B thereof is amended to read:

SEC. 10.5.
 (a) For fiscal years beginning on or after July 1, 1990, the appropriations limit of each entity of government shall be the appropriations limit for the 1986–87 fiscal year, adjusted for the changes made from that fiscal year pursuant to this article, as amended by the measure adding this section, adjusted for the changes required by Section 3.
(b) In the case of the State, beginning with the two-year fiscal period commencing on July 1, 2003, the appropriations limit shall be the appropriations limit for the 2002–03 fiscal year, adjusted for the changes made from that fiscal year pursuant to this article and adjusted for the changes required by Section 3.

Nineteenth

 That Section 8 of Article XVI is amended to read:

SEC. 8.
 (a) From all state revenues there shall first be set apart the moneys to be applied by the State for support of the public school system and public institutions of higher education.
(b) Commencing with the 1990–91 fiscal year, the moneys to be applied by the State for the support of school districts and community college districts shall be not less than the greater of the following amounts:
(1) The amount which that, as a percentage of General Fund revenues which that may be appropriated pursuant to Article XIII B, equals the percentage of General Fund revenues appropriated for school districts and community college districts, respectively, in the 1986–87 fiscal year 1986–87.
(2) The amount required to ensure that the total allocations to school districts and community college districts from General Fund proceeds of taxes appropriated pursuant to Article XIII B and allocated local proceeds of taxes shall not be less than the total amount from these sources in the prior fiscal year, excluding any revenues allocated pursuant to subdivision (a) of Section 8.5, adjusted for changes in enrollment and adjusted for the change in the cost of living pursuant to paragraph (1) of subdivision (e) of Section 8 of Article XIII B. This paragraph shall be operative only in a fiscal year in which the percentage growth in California per capita personal income is less than or equal to the percentage growth in per capita General Fund revenues plus one half of one 0.5 percent.
(3) (A) The amount required to ensure that the total allocations to school districts and community college districts from General Fund proceeds of taxes appropriated pursuant to Article XIII B and allocated local proceeds of taxes shall equal the total amount from these sources in the prior fiscal year, excluding any revenues allocated pursuant to subdivision (a) of Section 8.5, adjusted for changes in enrollment and adjusted for the change in per capita General Fund revenues.
(B) In addition, an amount equal to one-half of one 0.5 percent times the prior year total allocations to school districts and community colleges from General Fund proceeds of taxes appropriated pursuant to Article XIII B and allocated local proceeds of taxes, excluding any revenues allocated pursuant to subdivision (a) of Section 8.5, adjusted for changes in enrollment.
(C) This paragraph Paragraph (3) shall be operative only in a fiscal year in which the percentage growth in California per capita personal income in a fiscal year is greater than the percentage growth in per capita General Fund revenues plus one half of one 0.5 percent.
(c) In any fiscal year, if the amount computed pursuant to paragraph (1) of subdivision (b) exceeds the amount computed pursuant to paragraph (2) of subdivision (b) by a difference that exceeds one and one-half 1.5 percent of General Fund revenues, the amount in excess of one and one-half 1.5 percent of General Fund revenues shall not be considered allocations to school districts and community colleges for purposes of computing the amount of state aid pursuant to paragraph (2) or 3 (3) of subdivision (b) in the subsequent fiscal year.
(d) In any fiscal year in which school districts and community college districts are allocated funding pursuant to paragraph (3) of subdivision (b) or pursuant to subdivision (h) (g), they shall be entitled to a maintenance factor, equal to the difference between (1) the amount of General Fund moneys which that would have been appropriated pursuant to paragraph (2) of subdivision (b) if that paragraph had been operative or the amount of General Fund moneys which that would have been appropriated pursuant to subdivision (b) had subdivision (b) not been suspended, and (2) the amount of General Fund moneys actually appropriated to school districts and community college districts in that fiscal year.
(e) The maintenance factor for school districts and community college districts determined pursuant to subdivision (d) shall be adjusted annually for changes in enrollment, and adjusted for the change in the cost of living pursuant to paragraph (1) of subdivision (e) of Section 8 of Article XIII B, until it has been allocated in full. The maintenance factor shall be allocated in a manner determined by the Legislature in each fiscal year in which the percentage growth in per capita General Fund revenues exceeds the percentage growth in California per capita personal income. The maintenance factor shall be reduced each fiscal year by the amount allocated by the Legislature in that fiscal year. The minimum maintenance factor amount to be allocated in a fiscal year shall be equal to the product of General Fund revenues from proceeds of taxes and one-half of the difference between the percentage growth in per capita General Fund revenues from proceeds of taxes and in California per capita personal income, not to exceed the total dollar amount of the maintenance factor.
(f) For purposes of this section, “changes in enrollment” shall be measured by the percentage change in average daily attendance. However, in any fiscal year, there shall be no adjustment for decreases in enrollment between the prior fiscal year and the current fiscal year unless there have been decreases in enrollment between the second prior fiscal year and the prior fiscal year and between the third prior fiscal year and the second prior fiscal year.

(h)

(g) Subparagraph (B) of paragraph (3) of subdivision (b) may be suspended for one fiscal year only when made part of or included within any bill enacted pursuant to Section 12 of Article IV. All other provisions of subdivision (b) may be suspended for one fiscal year by the enactment of an urgency statute pursuant to Section 8 of Article IV, provided that the urgency statute may not be made part of or included within any bill enacted pursuant to Section 12 of Article IV.
(h) For the fiscal period commencing July 1, 2003, and for each subsequent fiscal period, “fiscal year,” as used in this section, shall be deemed to refer to one of the two 12-month periods from July 1 to June 30, inclusive, that comprise collectively the two-year fiscal period described in subdivision (a) of Section 12.1 of Article IV. The Legislature shall identify, in the budget act for each of those fiscal periods, the amount of the appropriations made by that budget act that apply for the support of school districts and community college districts for purposes of this section for each of the two fiscal years within that fiscal period. Additional state funding determined to be required under this section for the second fiscal year of a fiscal period may be appropriated in another statute.

Twentieth

 That Section 8.5 of Article XVI is amended to read:

SEC. 8.5.
 (a) In addition to the amount required to be applied for the support of school districts and community college districts pursuant to Section 8, the Controller shall during each fiscal year period the Controller shall transfer and allocate all revenues available pursuant to paragraph 1 of subdivision (a) of Section 2 of Article XIII B to that portion of the State School Fund restricted for elementary and high school purposes, and to that portion of the State School Fund restricted for community college purposes, respectively, in proportion to the enrollment in school districts and community college districts respectively.
(1) With respect to funds allocated to that portion of the State School Fund restricted for elementary and high school purposes, no transfer or allocation of funds pursuant to this section shall be required at any time that the Director of Finance and the Superintendent of Public Instruction mutually determine that current annual expenditures per student equal or exceed the average annual expenditure per student of the 10 states with the highest annual expenditures per student for elementary and high schools, and that average class size equals or is less than the average class size of the 10 states with the lowest class size for elementary and high schools.
(2) With respect to funds allocated to that portion of the State School Fund restricted for community college purposes, no transfer or allocation of funds pursuant to this section shall be required at any time that the Director of Finance and the Chancellor of the California Community Colleges mutually determine that current annual expenditures per student for community colleges in this State equal or exceed the average annual expenditure per student of the 10 states with the highest annual expenditures per student for community colleges.
(b) Notwithstanding the provisions of Article XIII B, funds allocated pursuant to this section shall not constitute appropriations subject to limitation.
(c) From any funds transferred to the State School Fund pursuant to subdivision (a), the Controller shall each year fiscal period allocate to each school district and community college district an equal amount per enrollment in school districts from the amount in that portion of the State School Fund restricted for elementary and high school purposes and an equal amount per enrollment in community college districts from that portion of the State School Fund restricted for community college purposes.
(d) All revenues allocated pursuant to subdivision (a) shall be expended solely for the purposes of instructional improvement and accountability as required by law.
(e) Any school district maintaining an elementary or secondary school shall develop and cause to be prepared an annual audit accounting for such funds revenue received pursuant to this section, and shall adopt a School Accountability Report Card for each school.

Twenty-First

 That the provisions of this measure are severable. If any provision of this measure or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.