71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 1161
House Bill 2116
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
Presession filed (at the request of State Treasurer Jim Hill)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Establishes State Stabilization Fund. Specifies sources and
uses of fund.
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to the State Stabilization Fund; creating new
provisions; amending ORS 293.190; and declaring an emergency.
Whereas Oregon is one of five states that do not have a budget
stabilization fund; and
Whereas Oregon experienced a significant recession that
resulted in five special legislative sessions between 1981 and
1983; and
Whereas Oregon was not prepared for the effects of the
recession; and
Whereas this lack of preparedness compelled the Legislative
Assembly to balance the state's budget by enacting an income tax
surcharge and by transferring $81 million from the State Accident
Insurance Fund, which resulted in a repayment obligation of $225
million from the General Fund; and
Whereas the State Economist predicts that the economy of this
state is slowing and that Oregon's income-tax-based revenue
structure is sensitive to underlying economic activity; and
Whereas the establishment of a budget stabilization fund will
help to stabilize the fiscal resources of the State of Oregon;
and
Whereas bond rating experts and fiscal authorities assert that
the establishment of a budget stabilization fund to protect
against an inevitable economic decline is a conservative approach
to managing state finances; and
Whereas a decrease in this state's credit rating would result
in millions of additional dollars paid for bond interest and
issuance costs; now, therefore,
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + (1) The State Stabilization Fund is established
in the State Treasury, separate and distinct from the General
Fund. Moneys in the State Stabilization Fund may be expended
only for the purpose of eliminating or alleviating the effects of
an economic recession or a legislatively declared emergency on
the financing of public education for kindergarten through grade
12 and community colleges, health and public safety in this
state.
(2) Moneys in the State Stabilization Fund may be invested
under policies established by the Oregon Investment Council as
provided by ORS 293.701 to 293.820.
(3) The State Stabilization Fund shall consist of:
(a) Appropriations from the General Fund;
(b) Any gifts, grants, federal government revenues or other
moneys as may be made available for deposit into the State
Stabilization Fund; and
(c) Any other moneys appropriated to the State Stabilization
Fund by the Legislative Assembly or otherwise allocated to the
fund by law.
(4) Earnings on moneys in the State Stabilization Fund may be
retained in the fund or may expended for the purpose of financing
public education for kindergarten through grade 12 and community
colleges, health and public safety in this state under the same
circumstances as the principal of the fund may be expended.
(5) When the State Stabilization Fund principal exceeds five
percent of the total revenues credited to the General Fund,
including net revenues from the Oregon State Lottery, the amount
by which the State Stabilization Fund principal exceeds five
percent of the total revenues credited to the General Fund,
including net revenues from the Oregon State Lottery, shall be
transferred to the General Fund to be used for general
governmental purposes.
(6) The Legislative Assembly may appropriate moneys from the
State Stabilization Fund only when:
(a) The Oregon Department of Administrative Services declares
both that economic conditions present or predicted in this state
indicate the presence or likelihood of an economic recession and
that revenue forecasts project a negative ending balance for the
General Fund for the biennium for which the forecasts are being
made; or
(b) At least three-fifths of the members of each house of the
Legislative Assembly declare an emergency.
(7) Moneys in the State Stabilization Fund may not be used to
fund new programs or as a substitute for moneys that would
otherwise be appropriated from a different source to state
budgets. Moneys in the fund may be expended only after a
declaration by the Legislative Assembly that the economic
conditions or emergency described in subsection (6) of this
section exists.
(8) Of appropriations made from the State Stabilization Fund
pursuant to this section, 60 percent must be dedicated to public
education, which includes kindergarten through grade 12 and
community colleges, 20 percent to health and 20 percent to public
safety.
(9) When the economic conditions or declared emergency
described in subsection (6) of this section results in a general
reduction in the amounts of appropriations or expenditure
limitations authorized from the General Fund for state agencies,
the Legislative Assembly may not reduce the amounts of
appropriations or expenditure limitations authorized for public
education, health or public safety in this state by a percentage
greater than the average percentage reduction for state
agencies. + }
SECTION 2. ORS 293.190 is amended to read:
293.190. (1) On December 31 in each odd-numbered year, all
General Fund appropriation balances as recorded on the records of
the Oregon Department of Administrative Services for the prior
biennium shall revert to the General Fund except for capital
construction, continuing contracts, contested claims, special
appropriations designated by legislative action { + ,
appropriations to the State Stabilization Fund established by
section 1 of this 2001 Act + } or savings continuously
appropriated to agencies under ORS 291.120.
(2) On December 31 in each odd-numbered year, all limitation
balances on any separate fund or cash account in the State
Treasury shall be canceled except for continuing contracts,
contested claims or special limitations designated by legislative
action.
(3) Notwithstanding subsections (1) and (2) of this section,
under conditions which shall be described by the department by
rule, upon request, an extension may be granted to allow an
agency to make final analyses and corrections before an
appropriation or limitation is canceled. The procedures for
requesting an extension and the criteria for approving the
request shall be established by the department.
SECTION 3. { + This 2001 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2001 Act takes effect on its
passage. + }
----------