Michigan proposal links stabilization fund transfers to revenue growth

When annual growth is above 2%, the legislature would transfer money into the fund. This applies to transfers from the state general fund into the stabilization fund. The transfer amount is the annual growth rate above 2% multiplied by state general fund-general purpose revenue for the fiscal year ending in the current calendar year. The calculation uses the fiscal year ending in the current calendar year, and the transfer goes to the fiscal year beginning in that calendar year.

The legislature could use fund money only under growth-related limits. These limits apply to legislative appropriations from the fund, except as provided in section 358. Except as provided in section 358, the legislature could not appropriate money from the fund for a fiscal year if estimated annual growth for the calendar year in which that fiscal year ends is above 0%. If estimated growth is below 0%, the legislature may appropriate by law up to 25% of the prior fiscal year-end balance. For consecutive negative-growth years, the limit in each year is 25% of the available balance at the start of the first fiscal year ending in a negative-growth year. The most recent consensus revenue estimate determines the growth estimate for each fiscal year.

The legislature would provide for transfers into or out of the fund through an appropriations act. This applies to transfers into and out of the fund.

This bill would take effect only if HB 6147 becomes law. HB 6147 must be enacted into law for this bill to take effect.