Text: HSB00025 Text: HSB00027 Text: HSB00000 - HSB00099 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 Section 1. The following amendment to the Constitution of
1 2 the State of Iowa is proposed:
1 3 The Constitution of the State of Iowa is amended by adding
1 4 the following new Article XIII:
1 5 ARTICLE XIII.
1 6 TAXPAYERS' RIGHTS.
1 7 SECTION 1. The state government and each local government
1 8 is subject to a revenue limit and a spending limit as provided
1 9 in section 8. Each government's beginning revenue limit is
1 10 equal to its total revenue in the base year, or, if higher, in
1 11 any of the three preceding fiscal years. This limit is
1 12 adjusted annually for the cumulative percentage rate of price
1 13 inflation or deflation since the base year and for any
1 14 cumulative percentage population increase since the base year.
1 15 Each county government's revenue limit includes all townships
1 16 in the county. A school district's "population" is its full-
1 17 time equivalent student enrollment. The "base year" is the
1 18 last fiscal year before this article becomes effective.
1 19 SEC. 2. "Revenue" includes all amounts received from all
1 20 sources, except (1) amounts refunded to the payors; (2) gifts
1 21 and contracts from nongovernmental sources; (3) amounts
1 22 received from the federal government; (4) fees voluntarily
1 23 paid for specific services, but any part of a fee in excess of
1 24 the actual cost of providing that specific service is revenue;
1 25 (5) an amount equal to a government's net cost increase
1 26 required by a federal law or rule adopted after this Article
1 27 becomes effective, but only to the extent not offset by
1 28 federal funds; (6) amounts borrowed after approval by vote of
1 29 the electors; (7) amounts borrowed by issuing revenue bonds on
1 30 which no payment can be made from tax revenue; and (8)
1 31 receipts applied to repay money borrowed lawfully, including
1 32 interest.
1 33 SEC. 3. The state revenue limit excludes, and the local
1 34 limits include, state revenue transferred to local governments
1 35 or applied as tax credits against local taxes.
2 1 SEC. 4. If a government's revenue in a fiscal year exceeds
2 2 its revenue limit, its limit for the next fiscal year shall be
2 3 reduced by the excess amount.
2 4 SEC. 5. A government's revenue limit may be temporarily
2 5 increased in an amount approved by a majority of that
2 6 government's electors voting in a referendum. The increase is
2 7 effective for no more than five fiscal years.
2 8 SEC. 6. One or more revenue limits may be temporarily
2 9 increased by law adopted by two-thirds vote of the whole
2 10 membership of each house of the General Assembly and approved
2 11 by the Governor. Each such law is effective for only one
2 12 fiscal year.
2 13 SEC. 7. Any change in a limit under section 4, 5, or 6 is
2 14 effective only for the specified fiscal year or years and does
2 15 not affect computation of the limit under section 1.
2 16 SEC. 8. Each government's total spending in a fiscal year
2 17 shall not exceed the sum of its (1) revenue limit for that
2 18 year, adjusted for any change under section 4, 5, or 6, or
2 19 actual revenue, whichever is less; (2) actual receipts in that
2 20 year which are excluded from revenue by section 2; and (3) net
2 21 unspent funds carried over from the preceding year.
2 22 SEC. 9. "Revenue" includes all receipts for a government's
2 23 trust funds for unemployment, retirement, medical, or other
2 24 benefits but does not include earnings of these trust funds.
2 25 "Spending" includes all payments and transfers into, and
2 26 excludes payments out of, these trust funds. "Net unspent
2 27 funds" excludes these trust funds.
2 28 SEC. 10. If a new local government is created, the state
2 29 shall establish its base year and the amount of its beginning
2 30 revenue limit, and shall reduce the appropriate state or local
2 31 revenue limit or limits by that amount. If two or more local
2 32 governments are combined, their revenue limits shall be
2 33 combined. If a service or program is transferred by law among
2 34 local governments, their revenue limits shall be
2 35 proportionally adjusted by law, with no increase in the
3 1 combined limits. The state may transfer any part of its
3 2 revenue limit to a local government but shall not transfer any
3 3 part of a local limit to the state.
3 4 SEC. 11. If a state law or rule adopted after this Article
3 5 becomes effective requires a local government to incur a net
3 6 cost increase, the state shall pay to the local government the
3 7 amount of the necessary net cost increase, and shall increase
3 8 the local revenue limit and decrease the state revenue limit
3 9 by that amount.
3 10 SEC. 12. Any state or local government plan for retirement
3 11 or other employee benefits shall be completely funded within
3 12 ten years after this Article becomes effective and at all
3 13 times thereafter, in accordance with generally accepted
3 14 actuarial and accounting principles.
3 15 SEC. 13. The state and local governments shall use
3 16 consistent accounting, in accordance with generally accepted
3 17 accounting principles, for all purposes.
3 18 SEC. 14. Any taxpayer has standing to sue to enforce this
3 19 Article and laws implementing it. If successful, the taxpayer
3 20 shall be reimbursed for all reasonable expenses of the suit.
3 21 SEC. 15. This Article becomes effective for the first
3 22 state fiscal year beginning at least six months after its
3 23 approval by the electors. The state by law shall implement
3 24 this Article and may adopt further restrictions and limits.
3 25 Sec. 2. DECLARATION OF INTENT. It is the intent of the
3 26 General Assembly in agreeing to the foregoing proposed
3 27 amendment that:
3 28 1. This declaration of intent shall be relied on by the
3 29 electors and the courts, with the same results as if it were
3 30 in the Constitution.
3 31 2. Article XIII does not authorize any borrowing and does
3 32 not impair the debt limits and other provisions of Article
3 33 VII.
3 34 3. To make the adjustment for price inflation or
3 35 deflation, the most reliable index of general price inflation
4 1 in the United States shall be selected in good faith as
4 2 provided by law. The selection of index shall not be changed
4 3 if the change would have the effect of weakening the limits.
4 4 Except for school districts, the adjustment for population
4 5 shall be made by using the most recent federal census, but use
4 6 of the most recent federal census estimate may be permitted by
4 7 law.
4 8 4. Official revisions of inflation and population data
4 9 affect revenue limits for future fiscal years, but do not
4 10 change limits for the fiscal year in which a revision is made
4 11 or for prior years.
4 12 5. "Revenue" includes, but is not limited to, all taxes,
4 13 fees, charges, assessments, and other receipts of the state
4 14 and local governments, except amounts expressly excluded by
4 15 section 2, 3, or 9 of Article XIII. Amounts transferred
4 16 between governments are counted as revenue only once.
4 17 6. "Fees voluntarily paid for specific services" includes
4 18 fees for hospital, recreational, public utility, and similar
4 19 services, but does not include any tax, assessment, toll, or
4 20 filing, permit, registration, or license fee.
4 21 7. A government which excludes an amount from revenue
4 22 under section 2 of Article XIII must accurately determine and
4 23 establish the correct amount excluded.
4 24 8. "Government" includes all parts, agencies, enterprises,
4 25 and operations of a government. "Local government" includes
4 26 each city, county, school district, special district, and
4 27 political subdivision in the state, except that townships are
4 28 included with county governments.
4 29 9. Because county limits include townships, a county
4 30 government may limit the total revenue and spending of
4 31 townships in that county.
4 32 10. If a government has a deficit of net unspent funds at
4 33 the end of a fiscal year, the deficit is subtracted in
4 34 computing the next year's spending limit under section 8 of
4 35 Article XIII. However, section 8 is intended to prevent any
5 1 such deficit and to require each government to operate on a
5 2 balanced budget.
5 3 11. Article XIII shall be interpreted and implemented to
5 4 achieve its purpose to limit the growth of revenue and
5 5 spending of the state and local governments.
5 6 Sec. 3. The foregoing proposed amendment to the
5 7 Constitution of the State of Iowa is referred to the General
5 8 Assembly to be chosen at the next general election for members
5 9 of the General Assembly and the Secretary of State is directed
5 10 to cause it to be published for three consecutive months
5 11 previous to the date of that election as provided by law.
5 12 EXPLANATION
5 13 This proposed Taxpayers' Rights Amendment adds a new
5 14 Article to the Iowa Constitution. It limits the future growth
5 15 rate of the total revenue and total spending of the state and
5 16 local governments, with some exceptions.
5 17 The state government and each local government has its own
5 18 revenue limit and spending limit. County limits include
5 19 townships.
5 20 Each government's beginning revenue limit is equal to its
5 21 highest total revenue in the base year or any of the three
5 22 preceding fiscal years. This limit is adjusted annually for
5 23 cumulative inflation or deflation and for any cumulative
5 24 population increase after the base year. The population
5 25 adjustment can rise or fall, but it cannot fall below the
5 26 population in the base year. The base year is the last fiscal
5 27 year before this amendment becomes effective.
5 28 Each government's spending limit is equal to its revenue
5 29 limit (or actual revenue, if less) for that year, plus all
5 30 actual receipts which are outside the revenue limit, plus
5 31 unspent funds carried over. This requires each government to
5 32 operate on a balanced budget.
5 33 A government's revenue limit can be temporarily increased
5 34 in either of two ways: (1) A majority vote of the people in a
5 35 state or local referendum can increase the limit in any
6 1 amount, for any purpose, and for any period up to five years.
6 2 (2) A vote of two-thirds of all members of each house, with
6 3 the governor's approval, can increase any or all limits for
6 4 one year.
6 5 If a government's actual revenue exceeds its revenue limit,
6 6 its limit for the next year is reduced by the excess amount.
6 7 The excess revenue cannot be spent in the year it is received
6 8 but can be spent in any future year.
6 9 State aid to local governments and state credits against
6 10 local taxes can be increased without limit, because these
6 11 amounts are outside the state limit and are included in local
6 12 limits. This provision encourages using state revenue for
6 13 local property tax replacement.
6 14 The state must pay for a net cost increase imposed on a
6 15 local government by a state law or rule adopted after this
6 16 amendment becomes effective.
6 17 The revenue limits include all taxes and most other
6 18 revenue. Examples of receipts outside the revenue limit are:
6 19 amounts refunded; private gifts and contracts; federal grants
6 20 and aid; a fee for a specific service, if the fee does not
6 21 exceed the cost of the service; the amount of a net cost
6 22 increase caused by a new federal mandate and not offset by
6 23 federal funds; amounts borrowed with the voters' approval;
6 24 revenue bonds; and receipts used to repay borrowed money.
6 25 Each fiscal year's revenue limit is based on the preceding
6 26 year's limit adjusted for inflation and population growth, not
6 27 on that year's actual revenue. Thus, a government is not
6 28 penalized for holding its revenue and spending below the
6 29 limit.
6 30 The amendment provides for changes in revenue limits if a
6 31 new local government is created, if local governments combine,
6 32 or if a state law transfers services among local governments.
6 33 However, the state cannot increase its share of total state
6 34 and local revenue and spending limits.
6 35 Sound funding of any retirement or benefit plan for
7 1 government employees is required within ten years.
7 2 The state and all local governments are required to follow
7 3 generally accepted accounting principles.
7 4 Any taxpayer may sue to enforce this new Article of the
7 5 Constitution.
7 6 Explanatory language is included in a separate declaration
7 7 of intent which will not become part of the Constitution but
7 8 will reduce the need for interpretation by the courts.
7 9 The resolution, if adopted, would be referred to the next
7 10 general assembly before being submitted to the electorate for
7 11 ratification.
7 12 LSB 1226XL 76
7 13 sc/sc/14
Text: HSB00025 Text: HSB00027 Text: HSB00000 - HSB00099 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
Iowa General Assembly
Search: House Bills and Amendments (76th General Assembly)
© 1996 Cornell College and League of Women Voters of Iowa
Comments? webmaster@legis.iowa.gov.
Last update: Thu Feb 8 16:38:58 CST 1996
URL: /DOCS/GA/76GA/Legislation/HSB/00000/HSB00026/950130.html
jhf