Senators pressed how ACA 20 interacts with the state appropriations (Gann) limit

Several senators pressed analysts on how ACA 20 would interact with the state appropriations limit (commonly called the Gann limit). Chair Laird asked whether excluding deposits from the limit when they are made would effectively allow the state to "spend more"; the LAO replied that the SAL requires that spending be counted somewhere and that excluding deposits at the time they are made can create an incentive to put more money into excluded categories like reserves during revenue surges.

The LAO emphasized that the SAL is most likely to bind in years of very strong revenues and noted the state had substantial room under the limit in the presented estimate. Senators argued the policy should be easy to explain to constituents and asked whether the SAL's calculation — which indexes an earlier base year for inflation and population — remains appropriate. LAO representatives said changes to the SAL would require voter action and that comparisons with other states require care because revenue systems differ.