Louisiana Transportation Fund and Revenue Allocation, Amendment 5 (2016)
| Louisiana Amendment 5 | |
|---|---|
 | |
| Election date November 8, 2016 | |
| Topic State and local government budgets, spending and finance | |
Status Approved | |
| Type Constitutional amendment | Origin State legislature |
| 2016 measures |
|---|
 |
| November 8 |
| Amendment 1 |
Amendment 2  |
| Amendment 3 |
| Amendment 4 |
| Amendment 5 |
| Amendment 6 |
| Polls |
| Voter guides |
| Campaign finance |
| Signature costs |
The Louisiana Transportation Fund and Revenue Allocation, Amendment 5, was on the November 8, 2016, ballot in Louisiana as a legislatively referred constitutional amendment. It was approved.
| A "yes" vote favored establishing the Revenue Stabilization Trust Fund to be used for construction projects and transportation infrastructure. |
| A "no" vote opposed establishing the Revenue Stabilization Trust Fund to be used for construction projects and transportation infrastructure. |
Election results
| Amendment 5 | ||||
|---|---|---|---|---|
| Result | Votes | Percentage | ||
| Yes | 949,805 | 53.6% | ||
| No | 822,079 | 46.4% | ||
- Election results from Louisiana Secretary of State
Text of measure
Ballot language
The following language appeared on the ballot:[1]
| “ |
Do you support an amendment to establish the Revenue Stabilization Trust Fund for the deposit of recurring mineral and corporate tax revenues, to restrict the use of the fund to 10% of the balance when the balance reaches $5 billion, to restrict the use of the fund to construction projects and transportation infrastructure, and to allocate recurring mineral revenues to the payment of state employee retirement debt? [2] |
” |
Constitutional changes
- See also: Louisiana Constitution
The measure was designed to amend Article VII, Section 10 of the Louisiana Constitution. The following text was added (indicated with Underlined text) and removed (indicated with Strike out text) by the measure's approval:[1]
| Changes to Article VII, Section 10 of Louisiana Constitution | |||||
|---|---|---|---|---|---|
| Section 1. Be it resolved by the Legislature of Louisiana, two-thirds of the members elected to each house concurring, that there shall be submitted to the electors of the state of Louisiana, for their approval or rejection in the manner provided by law, a proposal to add Article VII, Section 10(F)(4)(h), 10.15, and 10.16 of the Constitution of Louisiana, to read as follows:
§10. Expenditure of State Funds Section 10. (F) Projected Deficit. (4) The provisions of Subparagraphs (1) and (2) of this Paragraph shall not be applicable to, nor affect: (h) The Revenue Stabilization Trust Fund, as provided in Article VII, Section 10.15 of this constitution. §10.15. Revenue Stabilization Trust Fund Section 10.15. Revenue Stabilization Trust Fund. (A) The Revenue Stabilization Trust Fund is hereby established in the state treasury as a special trust fund, hereinafter referred to as the "fund". (B) After allocation of money to the Bond Redemption and Security Fund as provided in Article VII, Section 9(B) of the Constitution of Louisiana, the treasurer shall deposit in and credit to the fund the revenues as provided for in Paragraphs (C) and (D) of this Section. (C) The treasurer shall deposit into the fund the amount of mineral revenues as provided in Section 10.16 of this constitution. (D) The treasurer shall deposit into the fund the amount of revenues in excess of six hundred million dollars received each fiscal year from corporate franchise and income taxes as recognized by the Revenue Estimating Conference. (E)(1) Except as provided for in Paragraph (F) of this Section, monies deposited into the Revenue Stabilization Trust Fund shall be permanently credited to the trust fund and shall be invested by the treasurer in a manner provided for by law. (2) The treasurer shall deposit all interest or other income from investment generated from the fund into the state general fund. (F)(1) Except as provided in Subparagraphs (2) and (3) of this Paragraph, no appropriations shall be made from the Revenue Stabilization Trust Fund. (2)(a) In any fiscal year in which the balance of the fund at the beginning of the year is in excess of five billion dollars, hereinafter referred to as the minimum fund balance, the legislature may appropriate an amount not to exceed ten percent of the fund balance, hereinafter referred to as the allowable percentage, for the following: (i) Capital outlay projects in the comprehensive state capital budget. (ii) Transportation infrastructure. (b) The minimum fund balance or the allowable percentage may be change by a law enacted by two-thirds of the elected members of each house of the legislature. (3) In order to ensure the money in the fund is available for appropriation in an emergency, the legislature may authorize an appropriation from the fund at any time for any purpose only after the consent of two-thirds of the elected members of each house of the legislature. If the legislature is not in session, the two-thirds requirement may be satisfied upon obtaining the written consent of two-thirds of the elected members of each house of the legislature in a manner provided by law. §10.16. Dedications of Mineral Revenues Section 10.16.(A) All mineral revenues as defined in Paragraph (D) of this Section received in each fiscal year by the state as a result of the production of or exploration for minerals, hereinafter referred to as "mineral revenues", shall be allocated as provided in this Section after the following allocations and deposits of mineral revenues have been made: (1) To the Bond Security and Redemption Fund as provided in Article VII, Section 9 (B) of this constitution. (2) To the political subdivisions of the state as provided in Article VII, Sections 4 (D) and (E) of this constitution. (3) To the Louisiana Wildlife and Fisheries Conservation Fund as provided by the requirements of Article VII, Section 10-A of this constitution and as provided by law. (4) To the Louisiana Wildlife and Fisheries Conservation Fund and the Oil and Gas Regulatory Fund as provided by law. (5) To the Rockefeller Wildlife Refuge and Game Preserve Fund as provided by law. (6) To the Marsh Island Operating Fund and the Russell Sage or Marsh Island Refuge Fund as provided by law. (7) To the MC Davis Conservation Fund as provided by law. (8) To the White Lake Property Fund as provided by law. (9) To the Louisiana Education Quality Trust Fund and Louisiana Quality Education Support Fund as provided in Article VII, Section 10.1 of this constitution. (10) To the Coastal Protection and Restoration Fund as provided in Article VII, Section 10.2 of this constitution and as provided by law. (11) To the Mineral Revenue and Audit Settlement Fund as provided in Article VII, Section 10.5 of this constitution and as provided by law. (12) To the Budget Stabilization Fund as provided in Article VII, Section 10.3 of this constitution and as provided by law. (13) An amount equal to the state general fund deposited into the Transportation Trust Fund and the Louisiana State Transportation Infrastructure Fund as provided by law. (B) Allocation of Mineral Revenues. After the allocations and deposits provided in Paragraph (A) of this Section, the mineral revenues received in each year in excess of six hundred sixty million dollars and less than nine hundred fifty million dollars shall be allocated as follows: (1) Thirty percent shall be appropriated to the Louisiana State Employees' Retirement System and the Teachers'Retirement System of Louisiana for application to the balance of the unfunded accrued liability of such systems existing as of June 30, 1988, in proportion to the balance of such unfunded accrued liability of each such system, until such unfunded accrued liability has been eliminated. Any such payments to the public retirement systems shall not be used, directly or indirectly, to fund cost-of-living increases for such systems. (2) The remainder shall be deposited into the Revenue Stabilization Trust Fund. (C) Mineral revenues in excess of the base which would otherwise be deposited into the Budget Stabilization Fund under Subparagraph (A)(2) of Section 10.3 of this constitution, but are prohibited from being deposited into the fund under Subparagraph (C)(4) of Section 10.3 of this constitution, shall be distributed as follows: (1) Thirty percent shall be appropriated to the Louisiana State Employees' Retirement System and the Teachers'Retirement System of Louisiana for application to the balance of the unfunded accrued liability of such systems existing as of June 30, 1988, in proportion to the balance of such unfunded accrued liability of each such system, until such unfunded accrued liability has been eliminated. Any such payments to the public retirement systems shall not be used, directly or indirectly, to fund cost-of-living increases for such systems. The remainder shall be deposited into the Revenue Stabilization Trust Fund. (D) For purposes of this Section, "mineral revenues" shall include severance taxes, royalty payments, bonus payments, or rentals, with the following exceptions: (1) Revenues designated as nonrecurring, pursuant to Article VII, Section 10(B) of this constitution. (2) Revenues received by the state as a result of grants or donations when the terms or conditions thereof require otherwise. (3) Revenues derived from any tax on the transportation of minerals. Section 2. Be it further resolved that this proposed amendment shall be submitted to the electors of the state of Louisiana at the statewide election to be held on November 8, 2016. Section 3. Be it further resolved that on the official ballot to be used at the election, there shall be printed a proposition, upon which the electors of the state shall be permitted to vote YES or NO, to amend the Constitution of Louisiana, which proposition shall read as follows: Do you support an amendment to establish the Revenue Stabilization Trust Fund for the deposit of recurring mineral and corporate tax revenues, to restrict the use of the fund to 10% of the balance when the balance reaches $5 billion, to restrict the use of the fund to construction projects and transportation infrastructure, and to allocate recurring mineral revenues to the payment of state employee retirement debt? (Adds Article VII, Section 10(F)(4)(h), 10.15, and 10.16)[2] | |||||
Support
Supporters
Legislators
The following legislator sponsored House Bill 603, the amendment's corresponding legislation:[1]
- Rep. Walt Leger, III (D-91), State House Speaker Pro Tempore
- Rep. John Bagneris (D-100)
- Rep. Joe Bouie (D-97)
- Rep. Chad Brown (D-60)
- Rep. Jeff Hall (D-26)
- Rep. Lance Harris (R-25)
- Rep. Marcus Hunter (D-17)
- Rep. Barry Ivey (R-65)
- Rep. Katrina Jackson (D-16)
- Rep. Gregory A. Miller (R-56)
- Rep. Jay Morris (R-14)
- Rep. J. Kevin Pearson (R-76)
- Rep. John Schroder (R-77)
- Rep. Patricia Smith (D-67)
- Rep. Julie Stokes (R-79)
- Rep. Major Thibaut (D-18)
Organizations
- Council for a Better Louisiana[3]
Arguments in favor
Official arguments
The following argument was published in the PAR Guide to the 2016 Constitutional Amendments:[4]
| “ |
Louisiana’s spending problem stems from the fact that the Legislature appropriates nearly every dollar it receives every fiscal year. This amendment will stop that practice by introducing forced fiscal restraint as it relates to the volatile revenue sources of corporate income tax and mineral revenues. It will have the added benefit of recognizing that credit rating agencies assess the strength of Louisiana’s trust funds when calculating the state’s fiscal health and the reliability of the state to make good on its commitments. Irresponsible spending and fiscal mismanagement could cause these entities to further downgrade the state’s bond ratings, driving up the cost of borrowing money to finance important programs or long-term construction projects. Paying down state retirement unfunded accrued liabilities would reduce the amount needed to keep these systems solvent in the future and remove a substantial drag on Louisiana’s economy. This amendment helps pay down retirement liabilities and shows credit rating agencies that the state is prepared for economic cycles. It also would show that the state has a plan for stabilizing the revenue made available for general fund expenditure in a given year. It sets aside money in the long term for capital improvements and transportation infrastructure without losing sight of the potential need for emergency spending, all seen as positives by rating agencies. Accounts similar to the Revenue Stabilization Trust Fund already exist in several other states like Wyoming, with a heavy reliance on oil and fossil fuels. In 2015, Wyoming’s Trust Fund of about $6.9 billion generated about $390 million in interest to help fund government while maintaining a healthy fund balance as a safety net for the state. The fund would help the state find solid financial footing despite the booms and busts of the global oil industry and volatility of corporate tax receipts. Adopting this amendment now is critical because the Legislature is likely to lack the willpower necessary to reintroduce such legislation when times are better and revenue receipts are up. Legislators will have an additional tool at their disposal to address budget crises without having to impose new taxes on citizens or businesses. The fund would reduce political pressure on elected officials to spend new money on pet projects and other priorities that would derail comprehensive, long-term budget reform and create greater uncertainty in future budget years.[2] |
” |
Opposition
Opponents
The following legislators in the Louisiana House of Representatives voted "nay" for House Bill 603 during its final reading:[1]
- Rep. Lawrence Bagley (R-7)
- Rep. Dodie Horton (R-9)
- Rep. Rob Shadoin (R-12)
- Rep. Scott Simon (R-74)
Arguments against
Official arguments
The following argument was published in the PAR Guide to the 2016 Constitutional Amendments:[4]
| “ |
This proposal further ties the hands of the people’s elected legislators and reduces the flexibility needed to fund priorities appropriately. In order to govern effectively officials need every tool possible at their disposal to capitalize on opportunities or address downturns. If the Legislature is serious about making government more transparent and stabilizing the state’s budget, simpler solutions exist that do not require the creation of yet another trust fund that would further complicate an already convoluted system of transfers, thresholds, and other mechanisms. Reforming the existing Budget Stabilization Trust Fund by removing the cap on the total fund balance or adjusting the types of revenue channeled into the reserve may be more prudent. This amendment is an overly complicated fix. Additionally, the lack of limitations on what might constitute an “emergency” and the twothirds vote authorization to sweep money from the fund undermines the ability of this account to serve its stated purpose. When lawmakers are forced to cut popular programs, raise taxes, or tap into reserves of one-time money, transferring cash from accounts such as the Revenue Stabilization Trust Fund would likely be the path of least resistance. The proposal put forward in this amendment fails to establish the trust fund needed to promote real fiscal responsibility.[2] |
” |
Background
Previous measures
The Rainy Day Fund, also known as the Budget Stabilization Fund, was first established in 1998 when Louisiana voters approved Amendment 5. In 2015, voters were presented with a proposal to break the fund into two subfunds: one that would still act as the Budget Stabilization Fund and one that would be used for transportation projects, when they voted on Amendment 1. Revenue from Louisiana's minerals would have been directed into the transportation subfund. The measure was defeated. Amendment 5 was similar to Amendment 1 in that it was designed to direct minerals revenue into a fund for transportation projects. Amendment 5 was designed to establish an entirely new fund, however, while Amendment 1 was designed to add a subfund to the existing Budget Stabilization Fund.
Media editorials
Support
- Houma Today adopted a position of support for Amendment 5 for its 2016 amendment recommendations.[5]
- The Times-Picayune wrote the following in support of Amendment 5:[6]
| “ |
This amendment is an attempt to deal with those highs and lows by taking excess revenues out of the normal budget process. Mineral revenues between $660 million and $950 million would be divided two ways. Thirty percent of those revenues would go to pay down unfunded liabilities in two state retirement systems and the other 70 percent would go into the Revenue Stabilization Fund. Corporate tax collections above $600 million also would go into the fund. The Legislature could tap the fund with a two-thirds vote, which is a high enough threshold to prevent it from being raided. If the fund reaches $5 billion, lawmakers could use up to 10 percent of it in a year for capital projects and transportation infrastructure. With oil prices at low levels now, this fund might not grow very quickly. But that situation could change, and it would be smart to have a mechanism in place to set aside money for infrastructure, pension debt or emergencies.[2] |
” |
Opposition
Ballotpedia has not yet found any editorial board endorsements in opposition to Amendment 5. If you know of one, please email editor@ballotpedia.org.
Campaign finance
| Total campaign contributions: | |
| Support: | $0.00 |
| Opposition: | $0.00 |
As of January 19, 2017, no ballot question committees registered to support or oppose Amendment 5.[7][8]
Path to the ballot
- See also: Amending the Louisiana Constitution
House Bill 603 was first introduced in the Louisiana State Legislature on March 4, 2016. The bill was approved by the Louisiana House of Representatives on May 17, 2016, and was unanimously passed by the Louisiana State Senate on June 3, 2016.[9]
House vote
May 17, 2016
| House Bill 603 | ||||
|---|---|---|---|---|
| Result | Votes | Percentage | ||
| Yes | 84 | 95.45% | ||
| No | 4 | 04.55% | ||
Senate vote
June 3, 2016
| House Bill 603 | ||||
|---|---|---|---|---|
| Result | Votes | Percentage | ||
| Yes | 32 | 100.00% | ||
| No | 0 | 00.00% | ||
State profile
| Demographic data for Louisiana | ||
|---|---|---|
| Louisiana | U.S. | |
| Total population: | 4,668,960 | 316,515,021 |
| Land area (sq mi): | 43,204 | 3,531,905 |
| Race and ethnicity** | ||
| White: | 62.8% | 73.6% |
| Black/African American: | 32.1% | 12.6% |
| Asian: | 1.7% | 5.1% |
| Native American: | 0.6% | 0.8% |
| Pacific Islander: | 0% | 0.2% |
| Two or more: | 1.8% | 3% |
| Hispanic/Latino: | 4.7% | 17.1% |
| Education | ||
| High school graduation rate: | 83.4% | 86.7% |
| College graduation rate: | 22.5% | 29.8% |
| Income | ||
| Median household income: | $45,047 | $53,889 |
| Persons below poverty level: | 23.3% | 11.3% |
| Source: U.S. Census Bureau, "American Community Survey" (5-year estimates 2010-2015) Click here for more information on the 2020 census and here for more on its impact on the redistricting process in Louisiana. **Note: Percentages for race and ethnicity may add up to more than 100 percent because respondents may report more than one race and the Hispanic/Latino ethnicity may be selected in conjunction with any race. Read more about race and ethnicity in the census here. | ||
Presidential voting pattern
- See also: Presidential voting trends in Louisiana
Louisiana voted Republican in all seven presidential elections between 2000 and 2024.
More Louisiana coverage on Ballotpedia
- Elections in Louisiana
- United States congressional delegations from Louisiana
- Public policy in Louisiana
- Endorsers in Louisiana
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- More...
Related measures
- See also: Taxes on the ballot
Recent news
The link below is to the most recent stories in a Google news search for the terms Louisiana Amendment 5 revenue stabilization trust fund 2016. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.
See also
- Louisiana 2016 ballot measures
- 2016 ballot measures
- Louisiana Legislature
- List of Louisiana ballot measures
Footnotes
- ↑ 1.0 1.1 1.2 1.3 Louisiana Secretary of State, "2016 PROPOSED CONSTITUTIONAL AMENDMENTS November 8, 2016 Election," accessed July 25, 2016
- ↑ 2.0 2.1 2.2 2.3 2.4 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source. Cite error: Invalid
<ref>tag; name "quotedisclaimer" defined multiple times with different content Cite error: Invalid<ref>tag; name "quotedisclaimer" defined multiple times with different content Cite error: Invalid<ref>tag; name "quotedisclaimer" defined multiple times with different content Cite error: Invalid<ref>tag; name "quotedisclaimer" defined multiple times with different content - ↑ Council for a Better Louisiana, "CABL’s Recommendations on the 2016 Constitutional Amendments for the November 8 Ballot," October 21, 2016
- ↑ 4.0 4.1 Public Affairs Research Council of Louisiana, "PAR Guide to the 2016 Constitutional Amendments," accessed November 3, 2016
- ↑ Houma Today, "La. constitutional amendments: our recommendations for Tuesday's ballot," November 3, 2016
- ↑ The Times-Picayune, "Our recommendations on Louisiana's constitutional amendments: Editorial," October 28, 2016
- ↑ Louisiana Ethics Administration Program,"Louisiana Political Action Committees," accessed January 3, 2017
- ↑ Louisiana Ethics Administration Program,"Louisiana campaign finance reports," accessed January 19, 2017
- ↑ Louisiana State Legislature, "HB 603," accessed July 25, 2016
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