Bill
HB 646
Establishes a Government Growth Limit on recurring General Fund spending starting 2027-28, with growth set annually and tied to the REC, constraining future appropriations.
HB 646 (2026) – Louisiana Constitutional Amendment: Government Growth Limit
Overview
- What it is: A proposed constitutional amendment that would establish a Government Growth Limit (GGL) on recurring state general fund (Direct) revenues, effective for fiscal year 2027-2028 and onward.
- Purpose: To restrict how much recurring state General Fund money the Legislature may appropriate in any given fiscal year, with limited exceptions, and to require the governor’s budget and future appropriations to conform to this limit.
Key Provisions
- Government Growth Limit (GGL)
- Effective starting Fiscal Year 2027-2028.
- The limit would cap growth in the total amount of recurring State General Fund (Direct) appropriations for the next fiscal year.
- The limit is calculated annually by the Revenue Estimating Conference (REC) and established no later than the first quarter of the calendar year for the upcoming fiscal year.
- The initial (2027-2028) GGL is set at: the base equal to the total appropriations for recurring expenses from the State General Fund (Direct) for FY 2025-2026, plus 3% of that amount.
- The Louisiana Commissioner of Administration must calculate and submit the initial GGL to the Joint Legislative Committee on the Budget by January 31, 2027.
- A procedures framework would be established by law to calculate and apply the limit.
- Expenditure Limit vs. GGL
- The bill retains the existing requirement that the Legislature set an annual Expenditure Limit for state general fund and dedicated funds (with certain exceptions).
- Recurring revenues recognized above the GGL but below the Expenditure Limit may be appropriated only for nonrecurring expenses (nonrecurring defined as expenses not ongoing or expected to be needed in roughly the same amounts each year).
- Use of Nonrecurring Funds
- Amounts above the GGL but below the Expenditure Limit may be used only for nonrecurring expenses, per the definition above.
- Exceptions and Adjustments
- The legislature can provide by law for exceptions to the GGL calculation and application.
- A two-thirds vote of both houses can change the GGL if, in the three immediately preceding fiscal years, each growth factor was 2.5% or less. Any such change must be enacted via a specific legislative instrument clearly stating the intent to change the limit.
- Certain severance and royalty payments (from Article VII, Section 4(D) and (E)) would be exempt from the proposed GGL.
- Relationship to Forecasts and Budgets
- Existing rule: Appropriations from the State General Fund (Direct) may not exceed the official forecast in effect when appropriations are made.
- Recurring revenue appropriations must comply with the GGL and expenditure limit.
- The governor’s annual budget proposal must conform to the forecast, the Expenditure Limit, and the GGL.
- Submission to Voters
- The amendment would be placed on the ballot for statewide election on November 3, 2026.
- Ballot language asks voters whether they support amending the Constitution to require the legislature to establish procedures for calculating a limit on recurring General Fund appropriations, restrict use of revenue above that limit, permit certain exceptions, and require the governor’s budget to conform to the limit (affecting Art. VII, Sections 10(C), 10(E), and 11(A)).
Who Is Affected
- State government budgeting and finance processes:
- The Legislature (as it sets and adjusts the GGL and expenditure limit).
- The Revenue Estimating Conference (REC), which would establish the annual growth limit.
- The Governor and the Commissioner of Administration (budget preparation and submission must align with the limit and forecast).
- Agencies receiving General Fund (Direct) appropriations, especially for recurring expenses, as they must adhere to the GGL and expenditure framework.
- Nonrecurring expenditures would be prioritized for use above the GGL/below the Expenditure Limit.
Timeline and Process
- Initial GGL calculation: For FY 2027-2028, based on FY 2025-2026 recurring General Fund (Direct) appropriations plus 3%.
- REC to determine growth limit: No later than the first quarter of the calendar year for the next fiscal year.
- Governor’s budget: Must conform to forecast, Expenditure Limit, and GGL.
- Ballot: Voters will decide on November 3, 2026.
- Potential modifications: Two-thirds legislative vote to adjust the GGL only if growth factors were 2.5% or less in each of the three preceding years, via specific legislative instrument.
Notes
- The bill preserves many elements of the current expenditure framework but adds a distinct growth constraint intended to limit long-term growth of recurring General Fund spending.
- The proposal explicitly exempts certain severance and royalty payments from the GGL framework.
Compiled from official sources — confirm details with the bill’s official record.
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