SB 337 — AN ACT PROPOSING AN AMENDMENT TO ARTICLE VIII, § 6 OF THE DELAWARE CONSTITUTION RELATING TO LIMITATIONS ON APPROPRIATIONS.

Summary

This Act is the first leg of a Constitutional Amendment reflecting the recommendations of the Advisory Panel to the Delaware Economic and Financial Advisory Council (DEFAC) on Potential Fiscal Controls and Budget Smoothing Mechanisms established as per House Joint Resolution 8 of the 149th General Assembly (Panel). This Act would build upon the State’s existing appropriation limit methodology by moving the Budget Reserve Account into a newly defined Budget Stabilization Fund, defining rules for deposits to and withdrawals from said Budget Stabilization Fund, and adding a check of the appropriation limit against an index comprised of relevant indicators of growth of the State’s economy. The Panel further recommended that any final adoption of the structural budget reforms included in this Act be accompanied by statutory enactment of structural reforms to the Personal Income Tax by broadening the tax base as initially recommended by the DEFAC Advisory Council of Revenues report dated May 2015 and further detailed in the Panel’s report dated June 1, 2018.

Bill Text

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This bill proposes amendments to Article VIII, § 6 of the Delaware Constitution to establish a Budget Stabilization Fund and modify appropriation limits based on economic indicators.

• Article VIII, § 6

  Budget Reserve Account → Budget Stabilization Fund

  Changes the name from Budget Reserve Account to Budget Stabilization Fund.

• Article VIII, § 6

  the amount of the Budget Reserve Account → the amount of the Budget Stabilization Fund

  Updates text to replace Budget Reserve Account with Budget Stabilization Fund.

• Article VIII, § 6(f)(3)

  50 percent → 75

  Increases the maximum percentage of the difference that can be withdrawn from the Budget Stabilization Fund when expenditures exceed revenues.

• Article VIII, § 6(g)(1)

  10 percent → 5 percent

  Reduces the cap on deposits to the Budget Stabilization Fund from 10 percent to 5 percent of estimated State General Fund revenues.

• Article VIII, § 6(c)

  emergency → emergencies

  Corrects a typographical error in the text concerning appropriations during emergencies.

• Article VIII, § 6(e)(2)

  1 percent → 1 percent of the previous fiscal year’s budget act

  Clarifies the limit on the supplemental appropriation for the bond and capital improvements act.

• Article VIII, § 6(a)

  that may be paid out of the treasury pursuant to resolution in that behalf; a regular account of → ; a regular account of

  Clarifies the language regarding the payment of compensation to members of the General Assembly.

Action History

1. June 23, 2022

   Introduced and Assigned to Executive Committee in Senate

Sponsors

• Colin Bonini · Primary

Subjects