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CA NO. 4 – Limits Expenditure Limit for State General Fund

CA NO. 4 – Limits Expenditure Limit for State General Fund

ACT 366 - HB 464
What It Means:

This amendment provides for the allowable growth of the state’s budget.  This is called the ‘growth factor’.  Currently, the growth factor is calculated using the personal income growth of Louisiana for the prior three years.  This constitutional amendment authorizes changes to the growth factor calculation which shall not exceed 5%.

Yes
Voting YES Means...

Triggers a statutory companion bill’s implementation, which makes the growth factor calculation the average of the following four values:
the 3-year average growth of state personal income (current law),
the 3-year average growth of state gross domestic product,
the 3-year average growth of state population, and
the 3-year average growth of the Consumer Price Index for the Southern Region.
The growth factor could not exceed 5% but can be negative. A new expenditure limit is determined by applying the new growth factor to the lessor of the previous limit or the amount appropriated in the current year. Revisions to methodology require Joint Budget Committee approval. (Funds received from the federal government related to Covid-19 are not subject to the limit.)

No
Voting NO Means...

Keeps the growth factor calculation at the current methodology of the 3-year average growth of state personal income.

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