California Proposition 58 (2004)
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Proposition 58, or the California Balanced Budget Act, was on the statewide California primary ballot on March 2, 2004 as a legislatively-referred constitutional amendment, where it was convincingly approved.
- 4,535,084 (71.2%)
- 1,841,138 (28.8%)
Proposition 58 requires state legislators to pass a balanced budget every year. It also created a reserve fund called the Budget Stabilization Account in case of future financial trouble. It prohibited the creation of any future bonds to pay off deficits like that in Proposition 57 (the California Economic Recovery Bond Act). Proposition 58 would not have taken effect unless Proposition 57 also passed, which it ultimately did.
Propositions 57 and 58 were the centerpiece of Gov. Arnold Schwarzenegger's plan to resolve California's budget problems. Schwarzenegger campaigned heavily for the propositions' passage.
Official summary
- Requires enactment of a balanced budget where General Fund expenditures do not exceed estimated General Fund revenues.
- Allows the Governor to proclaim a fiscal emergency in specified circumstances, and submit proposed legislation to address the fiscal emergency.
- Requires the Legislature to stop other action and act on legislation proposed to address the emergency.
- Establishes a budget reserve.
- Provides that the California Economic Recovery Bond Act is for a single object or work.
- Prohibits any future deficit bonds.
Fiscal impact estimate
The California Legislative Analyst's Office provided an estimate of net state and local government fiscal impact for Proposition 58. That estimate was:
- Unknown net state fiscal effects, which will vary year by year and depend in part on actions of future Legislatures.
- Reserve provisions may smooth state spending, with reductions during economic expansions and increases during downturns.
- Balanced budget and debt limitation provisions could result in more immediate actions to correct budgetary shortfalls.
Path to the ballot
Proposition 58 was voted onto the ballot by the California State Legislature via ACAX5 5 (Proposition 58).
| Chamber | Ayes | Noes |
|---|---|---|
| Assembly | 80 | 0 |
| Senate | 35 | 5 |
See also
External links
- Official Voter Information Guide with text of Proposition 58
- March 2, 2004 ballot proposition election results
- LAO analysis of Proposition 58
- Smart Voter on Proposition 58
