Senate Bill No. 24

(By Senators Burdette, Mr. President, and Boley,

By Request of the Executive)
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[Introduced January 14, 1994; referred to the Committee
on Finance.

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A BILL to amend and reenact section twenty, article two, chapter five-a of the code of West Virginia, one thousand nine hundred thirty-one, as amended, relating to creating a revenue shortfall reserve fund; funding; and use of said fund.

Be it enacted by the Legislature of West Virginia:
That section twenty, article two, chapter five-a of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted to read as follows:
ARTICLE 2. FINANCE DIVISION.

§5A-2-20. Reduction of appropriations -- Powers of governor.

(a) The governor may reduce appropriations according to any of the methods set forth in sections twenty-one and twenty-two of this article if and only if he or she has first attempted to draw against the revenue shortfall reserve fund established in this section, and such action proves unavailing or insufficient to address any known or anticipated overdraft or deficit in thegeneral fund.
(b) A revenue shortfall reserve fund is hereby created within the state treasury. The revenue shortfall reserve fund shall be funded as set forth herein from surplus revenues, if any, in the state's general fund budget, as such surplus revenues may accrue from time to time. Within sixty days of the end of each fiscal year, the secretary shall cause to be deposited into the revenue shortfall reserve fund the first fifty percent of all surplus revenues, if any, determined to have accrued during the fiscal year just ended. In such manner, and on an annual basis, the revenue shortfall reserve fund shall be funded continuously and on a revolving basis up to an aggregate amount not to exceed five percent of the state's general fund budget for the fiscal year just ended. If at the end of any fiscal year the revenue shortfall reserve fund is funded at an amount equal to or exceeding five percent of the state's general revenue fund budget for the fiscal year just ended, then there shall be no further obligation on the secretary under the provisions of this section to apply any surplus revenues as set forth herein.
(c) Not earlier than the first day of November of each calendar year, if the state's fiscal circumstances are such as to otherwise trigger the authority of the governor to reduce appropriations under sections twenty, twenty-one, or twenty-two of this article, then in such event the governor shall notify in writing the presiding officers of both houses of the Legislature of his or her intention to draw on the revenue shortfall reservefund established by this section, and direct the secretary to draw down an amount or amounts from the revenue shortfall reserve fund sufficient in the judgment of the governor to avert the need for a reduction of appropriations. Such withdrawal of funds from the revenue shortfall reserve fund shall be subject to prior written approval of the presiding officers of both houses of the Legislature. Should such approval not be forthcoming from both presiding officers within twenty days of the governor's written request for approval, then the governor may proceed with a reduction of appropriations pursuant to section twenty-one and twenty-two of this article. Should any amount drawn from the revenue shortfall reserve fund pursuant to the direction of the governor and the written approval of the presiding officers of both houses of the Legislature, as set forth in this section, prove insufficient to address any anticipated shortfall, then the governor may also proceed with a reduction of appropriations pursuant to sections twenty-one and twenty-two of this article.



NOTE: The purpose of this bill is to create a "rainy day" fund to deal with midyear budget shortfalls.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.