44TH LEGISLATURE - STATE OF NEW MEXICO - FIRST SESSION, 1999

PROPOSING AN AMENDMENT TO ARTICLE 4 OF THE CONSTITUTION OF NEW MEXICO TO LIMIT EXPENDITURES OF THE STATE.

BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. It is proposed to amend Article 4 of the constitution of New Mexico by adding a new section to read:

"A. As used in this section:

(1) "state expenditures" means all money expended for any purpose, derived from any source, except funds derived from user fees, federal grants or funds, contributions, unemployment and disability insurance funds, pension fund contributions from employees, interest on pension fund investments or intergovernmental transfers of funds; and

(2) "state personal income" means total annual personal income of the state as determined by the United States department of commerce.

B. State expenditures in any fiscal year shall not be increased above such expenditures in the previous fiscal year by a percentage greater than the average percentage rate of growth in state personal income for the previous three years; provided, however, that in the event the governor declares a financial emergency to exist in the financing of state government and the legislature, by joint resolution approved by a two-thirds' vote of the total senate membership and two-thirds' vote of the total house of representatives membership, concurs in the governor's declaration, the limitation on expenditures prescribed in this subsection may be suspended for the fiscal year in which the emergency is declared to exist. Any such declaration shall specifically define the nature of the emergency and shall prescribe how the emergency shall be funded. The authorized state expenditure for the fiscal year following a fiscal year in which the spending limitation has been suspended because of an emergency shall be determined by defining state expenditures for the previous year as being the maximum expenditure that could have been authorized by the spending limitation prescribed in this subsection if such limitation had not been suspended.

C. The spending limitation provided for in Subsection B of this section may also be changed for a specific fiscal year by a favorable majority vote of the qualified electors of the state voting in a referendum called for that purpose conducted not less than sixty days prior to the commencement of the fiscal year concerned. The referendum shall be conducted pursuant to a joint resolution of the legislature which shall contain the referendum question.

D. To maintain the integrity of the limitation on state expenditures provided for in Subsection B of this section, the proceeds of state severance tax bonds shall not be used to fund operating expenses of state government, and such proceeds shall be used only for capital improvements.

E. The state shall not mandate to political subdivisions new programs or increase levels of service under existing programs unless the necessary costs thereof shall be paid for by the state.

F. To preserve the full faith and credit of the state with respect to any existing or future bonded indebtedness, the principal and interest payments on general obligation and severance tax bonds shall constitute priority state expenditures as defined in Subsection A of this section, and the expenditure limitations in this section shall not under any circumstances interfere with the payment of such obligations.

G. The legislature shall limit taxes to amounts necessary to fund authorized expenditures and minimize the accumulation of excess revenue other than to maintain the state reserve funds; provided, however, that there shall be no limitation on the amount of user fees, federal grants or funds, contributions, unemployment and disability insurance funds, pension fund contributions from employees, interest on pension fund investments or intergovernmental transfers of funds but not proceeds of taxes, fees or penalties imposed by the receiving unit which are collected by another unit of government."

Section 2. The amendment proposed by this resolution shall be submitted to the people for their approval or rejection at the next general election or at any special election prior to that date which may be called for that purpose.