A resolution to propose to the people of the State of California an amendment to the Constitution of the State, by adding and repealing Section 8.5 of Article II thereof, by adding and repealing Section 8.5 of Article IV thereof, and by adding and repealing Section 1.2 of Article XVI thereof, relating to state finance.

Existing provisions of the California Constitution provide that the electors may propose statutes or amendments to the California Constitution by initiative and approve or reject statutes by referendum. The California Constitution also provides that the Legislature may propose both amendments and revisions to the California Constitution to the electors, and may enact statutes by passing bills. This measure would, until January 1, 2020, prohibit an initiative measure from being submitted to the electors or from having any effect if the initiative measure appropriates state funds for any purpose in an amount exceeding the amount appropriated for that purpose for the 2004–05 fiscal year by more than $250,000 unless the measure provides for additional state revenue or offsetting savings in a total amount that is not less than the amount of the appropriation. This measure would, until January 1, 2020, provide that a statute, other than an urgency statute, is void if it appropriates state funds for any purpose in an amount exceeding the amount appropriated for that purpose for the 2004–05 fiscal year by more than $250,000 unless the statute provides for additional state revenue or offsetting savings in a total amount that is not less than the amount of the appropriation. This measure would also, until January 1, 2020, prohibit the Treasurer from offering for sale or issuing general obligation bonds unless the measure that authorized the sale or issuance of the bond provides for additional state revenue or offsetting savings in an amount necessary to repay the bond, including principal and interest payments.