House Bill 1114

AN ACT TO BE KNOWN AS THE BUDGET REFORM ACT OF 2005; TO CREATE NEW SECTION 27-103-221, MISSISSIPPI CODE OF 1972, TO SPECIFY THE SHORT TITLE OF THE ACT; TO CREATE NEW SECTION 27-103-223, MISSISSIPPI CODE OF 1972, TO CREATE THE REVENUE ESTIMATING COMMITTEE AND PROVIDE FOR ITS MEMBERSHIP; TO PROVIDE THAT THE COMMITTEE SHALL DEVELOP AND ADOPT TWO GENERAL FUND REVENUE ESTIMATES ANNUALLY THAT SHALL BE USED BY THE JOINT LEGISLATIVE BUDGET COMMITTEE AND THE GOVERNOR IN PREPARING THEIR PROPOSED STATE BUDGETS FOR THE NEXT FISCAL YEAR AND USED BY THE LEGISLATURE IN MAKING APPROPRIATIONS FROM THE STATE GENERAL FUND FOR THE NEXT FISCAL YEAR; TO AMEND SECTIONS 27-103-125, 27-103-139, 27-103-211 AND 31-17-123, MISSISSIPPI CODE OF 1972, TO CONFORM TO THE PRECEDING SECTION; TO CREATE NEW SECTION 27-103-225, MISSISSIPPI CODE OF 1972, TO REQUIRE THE LEGISLATURE, IN MAKING APPROPRIATIONS TO DEFRAY THE ORDINARY EXPENSES OF THE GOVERNMENT FOR EACH FISCAL YEAR, TO USE A TOTAL OF TEN APPROPRIATION BILLS; TO CREATE NEW SECTION 27-103-227, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT WHEN A MEMBER OF THE HOUSE OR SENATE INTRODUCES A BILL OR OFFERS AN AMENDMENT TO A BILL THAT WOULD EXPEND OR CAUSE THE EXPENDITURE OF STATE FUNDS, THE BILL OR AMENDMENT SHALL INCLUDE A PROVISION THAT WILL PROVIDE SUFFICIENT FUNDING FOR THE ANTICIPATED CHANGE IN STATE EXPENDITURES AS A RESULT OF THE BILL OR AMENDMENT; AND FOR RELATED PURPOSES.

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

SECTION 1. The following shall be codified as Section 27-103-221, Mississippi Code of 1972:

27-103-221. This act shall be known and may be cited as the "Budget Reform Act of 2005."

SECTION 2. The following shall be codified as Section 27-103-223, Mississippi Code of 1972:

27-103-223. (1) There is created the Revenue Estimating Committee, which shall be composed of nine (9) members as follows:

(a) The State Treasurer;

(b) The State Economist;

(d) The Director of the Legislative Budget Office;

(e) Two (2) members appointed by the Governor;

(f) One (1) member appointed by the Lieutenant Governor;

(g) One (1) member appointed by the Speaker of the House of Representatives; and

(h) One (1) member appointed by the State Treasurer.

(2) The State Treasurer shall serve as chairman of the committee. Each appointed member of the committee shall serve for the term of office of the appointing officer. Any vacancies on the committee during a term shall be filled by the original appointing officer.

(3) The committee shall develop and adopt annually during each fiscal year, using all available revenue forecast data available at the time, the following revenue estimates:

(a) During the month of October, not later than October 15, the committee shall adopt an estimate of the amount of general fund revenues that will be available for appropriation or use during the next fiscal year, which shall be used by the Joint Legislative Budget Committee and the Governor in preparing their proposed state budgets for the next fiscal year; and

(b) Ten (10) days before the scheduled date of sine die adjournment of the Legislature, the committee shall adopt an estimate of the amount of general fund revenues that will be available for appropriation or use during the next fiscal year, which shall be used by the Legislature in making appropriations from the State General Fund for the next fiscal year. This estimate shall be known as the "sine die general fund revenue estimate."

SECTION 3. Section 27-103-125, Mississippi Code of 1972, is amended as follows:

27-103-125. The proposed budget of each state agency shall show the amounts required for operating expenses separately from the amounts required for permanent improvements. The overall budget shall show, separately by each source, the estimated amount of general fund revenue and of special fund revenues of general fund agencies. The total proposed expenditures in Part 1 of the overall budget shall not exceed the amount of estimated revenues that will be available in the general and special funds for appropriation or use during the next fiscal year, including any balances that will be on hand in the general and special funds at the close of the then current fiscal year. The total proposed expenditures from the State General Fund in Part 1 of the overall budget shall not exceed ninety-eight percent (98%) of the amount of the general fund revenue estimate for the next fiscal year, plus any unencumbered balances in general funds that will be available and on hand at the close of the then current fiscal year. * * * The general fund revenue estimate shall be the estimate * * * adopted by the Revenue Estimating Committee under Section 27-103-223(3)(a). Unencumbered balances in general funds that will be available and on hand at the close of the current fiscal year shall not include projected amounts required to be deposited into the Working Cash-Stabilization Reserve Fund under Section 27-103-203. The Legislative Budget Office may recommend additional taxes or sources of revenue if in its judgment those additional funds are necessary to adequately support the functions of the state government.

SECTION 4. Section 27-103-139, Mississippi Code of 1972, is amended as follows:

27-103-139. On or before November 15 preceding each regular session of the Legislature, except the first regular session of a new term of office, the Governor shall submit to the members of the Legislature, the Legislative Budget Office or the members-elect, as the case may be, and to the executive head of each state agency a balanced budget for the next fiscal year. The budget submitted shall be prepared in a format that will include performance measurement data associated with the various programs operated by each agency. The total proposed expenditures in the balanced budget shall not exceed the amount of estimated revenues that will be available for appropriation or use during the next fiscal year, including any balances that will be on hand at the close of the then current fiscal year * * *. The total proposed expenditures from the State General Fund in the balanced budget shall not exceed ninety-eight percent (98%) of the amount of the general fund revenue estimate for the next fiscal year, plus any unencumbered balances in general funds that will be available and on hand at the close of the then current fiscal year. * * * The general fund revenue estimate shall be the estimate * * * adopted by the Revenue Estimating Committee under Section 7-103-223(3)(a). Unencumbered balances in general funds that will be available and on hand at the close of the fiscal year shall not include projected amounts required to be deposited into the Working Cash-Stabilization Reserve Fund * * * under Section 27-103-203.

The revenues used in preparing the balanced budget shall be only those revenues that will be available under the general laws of the state as they exist when the balanced budget is prepared, and shall not include any proposed revenues that would become available only after the enactment of new legislation. If the Governor has any recommendations for additional proposed expenditures or proposed revenues that are not included in his balanced budget, he shall submit those recommendations in a supplement that is separate from his balanced budget, and whenever the Governor recommends any such additional proposed expenditures, he also shall recommend proposed revenues that are sufficient to fund the additional proposed expenditures, providing specific details regarding the sources and the total amount of those proposed revenues.

The Governor may employ a budget officer for the purpose of receiving information from the State Fiscal Officer and preparing his recommendations on the budget. If the Governor determines that information received from the State Fiscal Officer is not sufficient to enable him to prepare his budget recommendations, he may request an appropriation from the Legislature to provide additional staff within the Governor's Office for that purpose. At the first regular session after his election for Governor, the Governor shall submit any budget recommendations plus the required revenue source recommendations no later than January 31 of that year.

SECTION 5. Section 27-103-211, Mississippi Code of 1972, is amended as follows:

27-103-211. The total sum appropriated by the Legislature from the State General Fund for any fiscal year shall not exceed ninety-eight percent (98%) of the sine die general fund revenue estimate for that fiscal year adopted by the Revenue Estimating Committee under Section 27-103-223(3)(b), plus any unencumbered balances in general funds that will be available and on hand at the close of the then current fiscal year. The unencumbered balances in general funds that will be available and on hand at the close of the fiscal year shall not include projected amounts required to be deposited into the Working Cash-Stabilization Reserve Fund under Section 27-103-203. * * *

SECTION 6. Section 31-17-123, Mississippi Code of 1972, is amended as follows:

31-17-123. (1) The intent of the Legislature is to authorize borrowing funds under the provisions of Sections 31-17-101 through 31-17-123 to offset any temporary cash flow deficiencies and should not be construed to authorize the borrowing of any funds in an amount that cannot be repaid during the fiscal year in which the funds are borrowed. * * *

(2) If, at the end of October, or at the end of any month thereafter of any fiscal year, the revenues received for the fiscal year * * * fall below ninety-eight percent (98%) of the sine die general fund revenue estimate adopted by the Revenue Estimating Committee under Section 27-103-223(3)(b), the State Fiscal Officer shall reduce allocations of general funds and state-source special funds to general fund and special fund agencies and to the "administration and other expenses" budget of the Mississippi Department of Transportation in an amount necessary to keep expenditures within the sum of actual general fund receipts, including any transfers to the General Fund from the Working Cash-Stabilization Reserve Fund for the fiscal year. The State Fiscal Officer may, upon his determination of need based on the revenue shortfall, transfer funds as provided in Section 27-103-203 from the Working Cash-Stabilization Reserve Fund to the General Fund to supplement the general fund revenue. State-source special funds in an amount equal to any reduction made under the provisions of this section shall be transferred to the State General Fund upon requisitions for warrants signed by the respective agency head, and the transfer shall be made within a reasonable period to be determined by the State Fiscal Officer. No agency's allocation shall be reduced in an amount to exceed five percent (5%); however, if the allocations of general funds and state-source special funds to all general fund and special fund agencies and to the "administration and other expenses" budget of the Mississippi Department of Transportation have been reduced by five percent (5%), any additional reductions required to be made under this section shall consist of a uniform percentage reduction of general funds and state-source special funds to all general fund and special fund agencies and to the "administration and other expenses" budget of the Mississippi Department of Transportation. Any receipt from loans authorized by Sections 31-17-101 through 31-17-123 shall not be included as revenue receipts. The State Fiscal Officer shall immediately send notice of any action taken under authority of this section to the Legislative Budget Office.

(3) For the purpose of this section, "state-source special funds" shall be construed to mean any special funds in any agency derived from any source, but shall not include the following special funds: special funds derived from federal sources, from local or regional political subdivisions, or from donations; special funds held in a fiduciary capacity for the benefit of specific persons or classes of persons; self-generated special funds of the state institutions of higher learning or the state junior colleges; special funds of Mississippi Industries for the Blind, the State Port at Gulfport, Yellow Creek Inland Port, Pat Harrison Waterway District, Pearl River Basin Development District, Pearl River Valley Water Management District, Tombigbee River Valley Water Management District, Yellow Creek Watershed Authority, or Coast Coliseum Commission; special funds of the Department of Wildlife, Fisheries and Parks derived from the issuance of hunting or fishing licenses; and special funds generated by agencies whose primary function includes the establishment of standards and the issuance of licenses for the practice of a profession within the State of Mississippi.

SECTION 7. The following shall be codified as Section 27-103-225, Mississippi Code of 1972:

27-103-225. In making appropriations to defray the ordinary expenses of the executive, legislative and judicial departments of the government for each fiscal year, the Legislature shall use a total of ten (10) appropriation bills that incorporate the following subjects:

(a) Public Safety, which shall include law enforcement, military, corrections and veterans affairs;

(b) Education, which shall include grades K-12, state institutions of higher learning and junior and community colleges;

(d) Health and human services, which shall include the Department of Health, the Department of Mental Health, the Department of Rehabilitation Services and the Department of Human Services;

(e) Social welfare, which shall include Medicaid;

(f) Transportation;

(g) Government operations, which shall include executive, administrative and fiscal affairs, including debt service;

(h) Judiciary;

(i) Agriculture and natural resources; and

(j) Business and commerce.

SECTION 8. The following shall be codified as Section 27-103-227, Mississippi Code of 1972:

27-103-227. (1) Whenever a member of the House of Representatives or the Senate introduces a bill, the purpose or effect of which would be to expend or to authorize or cause the expenditure of any state funds or otherwise decrease the revenue of the state, either directly or indirectly, the bill shall include a provision or provisions that will provide sufficient funding for the anticipated change in state expenditures or revenue as a result of the bill, either through the imposition or increase of a tax or taxes or a fee or fees, or any combination of taxes and fees, or by some other method that designates the specific source or sources of the funding and specifically provides that funding.

(2) Whenever a member of the House of Representatives or the Senate offers an amendment to a general bill in committee or on the floor of the House or Senate, the purpose or effect of which would be to expend or to authorize or cause the expenditure of any state funds or otherwise decrease the revenue of the state, either directly or indirectly, the amendment shall include a provision or provisions that will provide sufficient funding for the anticipated change in state expenditures or revenue as a result of the amendment, either through the imposition or increase of a tax or taxes or a fee or fees, or any combination of taxes and fees, or by some other method that designates the specific source or sources of the funding and specifically provides that funding. For the purpose of this subsection, code sections or chapter law sections that were not in the bill as introduced may be included in any such amendment and amended for the purpose of providing sufficient funding for the anticipated change in state expenditures or revenue as a result of the amendment, and the amendment shall not be subject to a point of order for the reason that it includes those sections providing that funding. When a code section or chapter law section is included in an amendment for this purpose, the only provisions of that section that may be amended are those that are necessary to be changed to provide funding for the amendment. As used in this subsection, the term "general bill" means any bill except an appropriation bill or a local and private bill.

(3) Whenever a member of the House of Representatives or the Senate offers an amendment to an appropriation bill in committee or on the floor of the House or Senate that would increase any sum appropriated or authorized to be expended by the bill, increase any sum designated for a particular object or purpose of expenditure in the bill, appropriate or authorize the expenditure of a new sum or sums for any purpose, or otherwise increase the total sum appropriated or authorized to be expended by the bill, the amendment shall include a provision or provisions that will reduce a sum or sums appropriated or authorized to be expended, reduce a sum or sums designated for any particular object or purpose of expenditure, delete a sum or sums appropriated or authorized to be expended for any purpose, or otherwise reduce the total sum appropriated or authorized to be expended, in the same bill or in any other appropriation bill or bills that still are under consideration or in both the same bill and another bill or bills, by amounts so that the amendment will provide a total reduction in sums that is not less than the total increase in sums provided in the amendment. The other appropriation bill or bills from which reductions are to be made under the amendment need not be designated by bill number in the amendment if they are described sufficiently enough to be identified. If such an amendment is adopted to an appropriation bill and the amendment provides that any part of the reduction is to be made from a bill or bills other than the one to which the amendment was adopted, then when the House or Senate considers that other bill or bills, it shall vote to reduce the total sum appropriated by that bill or bills by the total sum required to be reduced by the amendment in the manner directed by the amendment.

SECTION 9. This act shall take effect and be in force from and after July 1, 2005.