Proposed Constitutional Amendment to Be Placed Before Voters

Coming into print at 9pm on June 22, the California Legislature is expected to pass ACA 20 by Thursday’s deadline to place measures on the statewide ballot for November 3.

The following is a summary of the provisions of ACA 20:

ACA 20 (Assembly Members Gabriel and Valencia and Senators Laird and Hurtado)

Amends Sections 20 and 22 of Article XVI of the State Constitution

2/3 vote required due to proposed amendment to the Constitution

Called the Save for California’s Future Act

Contains 8 legislative findings and declarations, and the following intent statement:

“It is therefore the intent of the Legislature to strengthen the state’s commitment to responsible budgeting, long-term financial planning, and prudent savings by enhancing California’s budget reserves and ensuring that the state is better prepared for future economic challenges. Strengthening reserves is an investment in California’s future and in future generations.”

The measure would require 50% of that sum and 50% of the amount equal to 1.5% of the estimated amount of General Fund revenues for the fiscal year to be transferred to the Budget Stabilization Account each fiscal year until the 2039–40 fiscal year, and it would require the remaining 50% to be appropriated for unfunded liabilities and other specified purposes. The measure would add repayment of federal loans relating to unemployment insurance to the purposes for which the remaining 50% may be appropriated.

The California Constitution limits the amount that is required to be transferred to the Budget Stabilization Account for any fiscal year from exceeding an amount that would result in a balance in the account that, when the transfer is made, exceeds 10% of the estimated amount of the General Fund proceeds of taxes for the fiscal year. This measure would increase that limit to 20% of the estimated amount of theGeneral Fund proceeds of taxes for the fiscal year.

This measure would exclude both of the following from the appropriations subject to limitation of the State commencing with the 2027–28 fiscal year: (A) transfers to the Budget Stabilization Account; and (B) transfers to a General Fund reserve account established by the Legislature known as the Projected Surplus Temporary Holding Account, provided that the amount not subject to limitation may not exceed 10% of the amount of General Fund proceeds of taxes for the applicable fiscal year. Funds withdrawn, transferred, or appropriated from those reserve accounts, if they were not counted previously as appropriations subject to limitation of the State when deposited, would constitute appropriations subject to limitation of the State in the fiscal year in which the withdrawal, transfer, or appropriation occurs.