Laws, Regulations & Annotations

Property Taxes Law Guide – Revision 2011
 

California Constitutional Provisions

Article XIII B Constitution Government Spending Limitation

Section 2

Sec. 2. Return of excess revenues. (a) (1) Fifty percent of all revenues received by the state in a fiscal year and in the fiscal year immediately following it in excess of the amount which may be appropriated by the state in compliance with this article during that fiscal year and the fiscal year immediately following it shall be transferred and allocated, from a fund established for that purpose, pursuant to Section 8.5 of Article XVI.

(2) Fifty percent of all revenues received by the state in a fiscal year and in the fiscal year immediately following it in excess of the amount which may be appropriated by the state in compliance with this article during that fiscal year and the fiscal year immediately following it shall be returned by a revision of tax rates or fee schedules within the next two subsequent fiscal years.

(b) All revenues received by an entity of government other than the state, in a fiscal year and in the fiscal year immediately following it in excess of the amount which may be appropriated by the entity in compliance with this article during that fiscal year and the fiscal year immediately following it shall be returned by a revision of tax rates or fee schedules within the next two subsequent fiscal years.

History.—The amendment of November 8, 1988, added subdivision letter (a) and subdivision (a); added subdivision letter (b) and moved former paragraph of this section to subdivision (b); and substituted "except as provided in subdivision (a) of this section, revenues" for "Revenues" before "received" in subdivision (b). The amendment of June 5, 1990, added subsection number (1) and subdivision (a)(1); added subsection number (2) and moved former subdivision (a) to subdivision (a)(2); substituted "fifty percent of all" for "All" before "revenues", added "in a fiscal year and in the fiscal year immediately following it" after "state", substituted "the" for "that" after "excess of", substituted "may be" for "is" after "which", substituted "article during that fiscal year and the fiscal year immediately following it shall" for "Article, and which would otherwise be required, pursuant to subdivision (b) of this Section, to" after "with this", and deleted ", shall be transferred and allocated pursuant to Section 8.5 of Article XVI up to the maximum amount permitted by that section" after "fiscal years" in subdivision (a)(2); and substituted "All" for "Except as provided in subdivision (a) of this Section" before "revenues", substituted "an" for "any" after "received by", added "other than . . . following it" after "government,", substituted "the" for "that" after "excess of", substituted "may be" for "is" after "which", substituted "the" for "such" after "appropriated by", substituted "article" for "Article" after "this", substituted "that" for "the" after "during", and added "and the fiscal year immediately following it" after "that fiscal year" in subdivision (b).

Construction.—This section was designed to provide discipline in government spending by requiring the return of excess revenue. It applies, however, only to governmental entities that fully obtain tax receipts; it does not apply where a governmental entity that obtained tax receipts never had a ful right to obtain them. Rider v. San Diego County, 11 Cal.App.4th 1410.