Sec. 3. Statutory referendum procedure; submission at statewide election; form of question; effective date. This Act takes effect when approved only for the purpose of permitting its submission to the legal voters of the State at a statewide election held on the Tuesday following the first Monday of November following passage of this Act. The municipal officers of this State shall notify the inhabitants of their respective cities, towns and plantations to meet, in the manner prescribed by law for holding a statewide election, to vote on the acceptance or rejection of this Act by voting on the following question:

"Do you favor placing a limit on the maximum annual percentage increase in state and local government expenditures; requiring a 2/3 vote of the Legislature to approve state General Fund expenditures that exceed this limit and a 2/3 vote of a local government's governing body to approve local government expenditures that exceed this limit; and requiring that surplus funds be placed in an emergency reserve fund or returned to the citizens?"

The legal voters of each city, town and plantation shall vote by ballot on this question and designate their choice by a cross or check mark placed within a corresponding square below the word "Yes" or "No." The ballots must be received, sorted, counted and declared in open ward, town and plantation meetings and returns made to the Secretary of State in the same manner as votes for members of the Legislature. The Governor shall review the returns and, if it appears that a majority of the legal votes are cast in favor of the Act, the Governor shall proclaim that fact without delay, and the Act takes effect 30 days after the date of the proclamation.

The Secretary of State shall prepare and furnish to each city, town and plantation all ballots, returns and copies of this Act necessary to carry out the purposes of this referendum.

SUMMARY

This bill establishes expenditure limits on state and local governments as follows.

1. It provides that the maximum annual percentage increase in state General Fund expenditures, excluding federal funds received by the General Fund, may not exceed inflation plus the percentage change in state population in the prior year.