Transcript Highlights:

• So revenue is going to go like this; revenue from the tax is going to go like this.
• This is a general fund revenue source, so we are going to see a decrease in revenues in that line item
• But two important numbers are the gap between what revenue we have presently and what revenue we would
• See, the revenues decline.
• the state's non-recurring revenue.

Committee: House Revenue Stabilization & Tax Policy Committee

Transcript Highlights:

• So was the taconite homestead credit the ninth in the order of calculation?
• And this is because of how and when they're applied in the tax calculation.
• Credits, on the other hand, are applied after the calculation of gross tax.
• </c> um they're applied after the calculation um they're applied after the calculation of<00:47:20.599
• </c><01:10:34.920><c> by</c> the effective tax rate is calculated by the effective tax rate is calculated

Committee: Senate Taxes

Transcript Highlights:

• If revenues were used as opposed to the balance where the account sits at June 30th, If revenues were
• Bruce's answer about using revenues as their base for their calculation for their cap.
• The key there is the tax revenue.
• are, considering all revenue sources.
• Budget files and how they determine what those mill levy calculations are, considering all revenue sources

Committee: Joint Legislative Audit and Fiscal Review Committee

Transcript Highlights:

• Fund revenue estimates, growth in local property tax revenue, and an adjustment for transitional kindergarten
• The LAO explained to us today that for every dollar of revenue, either above our expected revenue...
• Revenue estimate for 2024-25 until May of 2026.
• Because fixed costs have gone up higher than the revenue.
• , not even an increase in revenue.

Transcript Highlights:

• And that only calculates the economic cost of crashes.
• It takes in revenue and then spends it on projects.
• And then you go down to Table C, the revenue after enacting SB 2 is $157 million.
• We've had, as good mention, consecutive years of $3 billion-plus excess revenue.
• Consecutive years of $3 billion-plus excess revenue.

Summary: The committee first heard TRIP’s annual New Mexico transportation report from Carolyn Boniface Kelly, which described deteriorating roads and bridges, congestion, safety concerns, and a large transportation funding gap. The report said more than half of major roads statewide are in poor or mediocre condition, over 170 bridges are rated poor, congestion costs drivers significant time and money, and traffic crashes and road conditions impose billions in annual costs. Members broadly agreed the report underscored the need for more stable transportation funding, with several noting the state’s recurring underinvestment and the safety risks to motorists, pedestrians, and bicyclists. The committee then took up Senate Bill 2, a transportation bonding and revenue package. Senator Gonzales and Governor’s office and NMDOT representatives said the bill would authorize about $1.5 billion in additional bond debt for ready-to-go highway projects, while also increasing certain motor vehicle excise, registration, weight-distance, and EV-related fees to help support debt service and transportation funding. Supporters, including contractors, the Greater Albuquerque Chamber, the Department of Finance and Administration, and transportation officials, argued the bill would improve safety, economic development, project delivery, and funding stability, and help preserve federal dollars. Opponents, including the Rio Grande Foundation and some committee members, objected to the tax and fee increases, argued the state should use existing surpluses or other funds instead, and raised concerns about impacts on families, businesses, and local governments. Committee members questioned how projects would be selected, how the new fees were calculated, how EV surcharges would work, and whether local government distributions would be affected. NMDOT said the projects would be reported to the legislature annually, selected using crash data, asset management, and project readiness, but bond approval would remain with the State Transportation Commission. After debate, Representative Romero moved do pass on SB 2 as amended, Representative Hochman-Vigil seconded, and the committee approved the bill 7-2, with Representatives Brown and Dow voting no and several members expressing reservations despite supporting the need for transportation investment.

Transcript Highlights:

• calculation benefited the taxpayer the most.
• calculation benefited the taxpayer the most.
• calculation benefited the taxpayer the most.
• calculation benefited the taxpayer the most.
• </c><01:05:26.599><c> of</c> understanding is that the calculation of understanding is that the calculation

Committee: House Taxes

Transcript Highlights:

• General fund revenue typically is the most important input affecting the calculation of the Proposition
• 98 minimum guarantee, and the revenue picture right now is deeply unsettled.
• It could be combined with revenue increases, depending on your preferences.
• It is still, it's calculated based on their... Higher amounts per student.
• So revenue is going down while costs are escalating.

Summary: The subcommittee opened with remarks on the state budget and K-12 education, noting the large increase in the Proposition 98 minimum guarantee, the use of deferrals and reserves in the prior budget, and the challenge of balancing education funding against other state priorities. Superintendent Tony Thurmond described California education as improving overall, citing gains in test scores, graduation, and college readiness, but said major gaps remain for low-income students, students of color, agricultural communities, English learners, foster youth, and students with disabilities. He praised recent investments in universal meals, transitional kindergarten, community schools, arts, broadband, and special education, while warning that declining enrollment, chronic absenteeism, and the proposed $5.6 billion Prop. 98 settle-up create uncertainty for districts. He also urged a long-term literacy plan, expanded tutoring, universal kindergarten, and continued protections for students and families affected by immigration enforcement, including ICE-related fear and attendance loss. The committee then heard a detailed presentation on Proposition 98 from the Department of Finance and the Legislative Analyst’s Office. Finance explained that the Governor’s budget projects the minimum guarantee will rise by about $21.7 billion over three years, with a $5.6 billion settle-up obligation in 2025-26 intended to avoid overappropriation if revenues weaken. Finance also described revised reserve deposits and withdrawals, ending with about $4.1 billion in the Public School System Stabilization Account by 2026-27. The LAO said recent revenue collections were stronger than expected in the current year but warned that the outlook for 2026-27 is weaker and that stock-market-driven revenues remain volatile. The LAO supported maintaining reserves and one-time spending buffers, but recommended fully funding the guarantee and using other budget solutions rather than shifting the settle-up into future deficits. Members asked about the settle-up process, certification timeline, the effect of attendance declines tied to immigration enforcement, and wildfire-related impacts, including Pasadena Unified’s $4 million special appropriation. On LCFF and necessary small schools, Finance proposed a 2.41% COLA and about $2.2 billion in additional LCFF funding for districts and charters in 2026-27, plus a $30.7 million ongoing increase to raise the necessary small schools allowance by 20%. The LAO supported funding the COLA but said the small-school increase was not tied to a specific cost study and could be redesigned to better target small districts, noting that only a fraction of very small districts would benefit. Questions focused on how small schools access supplemental and concentration grants and how attendance recovery programs are being implemented. The Department of Education said only 130 LEAs had reported attendance recovery so far, likely because it is a new program with compliance requirements, though interest appears to be growing. FICMAT then reviewed the fiscal health of local districts, reporting an uptick in qualified and negative certifications, though still far below Great Recession levels. It said declining enrollment, rising special education costs, and higher labor and insurance costs are the biggest fiscal pressures, and that some districts are using fiscal stabilization plans and staff reductions ahead of second interim reports. FICMAT also discussed wildfire impacts on Pasadena Unified and Los Angeles Unified, explaining that Pasadena’s $4 million state appropriation was based on an early post-fire assessment and that the district is being monitored with the county office of education. Members raised concerns about Pasadena’s leadership, special education staffing shortages, AB 218 sexual abuse litigation costs, insurance premium increases, and the need for stronger prevention and training measures. FICMAT said SB 848 and related policies address some of those concerns by strengthening standards, training, and reporting requirements.

Transcript Highlights:

• </c><00:08:01.039><c> structure</c> walkth through on the revenue structure walkth through on the revenue
• So that's revenues.
• </c> so sort of a whirlwind tour of revenues so sort of a whirlwind tour of revenues and<00:20:09.120
• :29.000><c> each</c> um calculates tax rates for each um calculates tax rates for each employer<00:46
• </c> when we had C when we had calculated when we had C when we had calculated that<00:48:09.880><c>

Committee: Senate Jobs and Economic Development

Transcript Highlights:

• These figures will be used to determine two multipliers, the highest of which will be used to calculate
• The calculation will be done annually, with the first calculation occurring in December of 2026.
• It's 1% that will come from the calculation of the market pay enhancement, which is based on salaries
• It's a new special revenue sub-fund of the Economic Development Project Fund, which is overseen by the
• Senate Bill 842 is a supplemental appropriation that increases special revenue spending authority in

Summary: The Senate Finance Committee met with a quorum present and first approved the minutes from the prior meeting. It then reconsidered Committee Substitute for House Bill 5212, noting that an Education Committee amendment had been inadvertently omitted the day before; the vice chairman withdrew the prior motion to report the bill, and the committee returned to the bill with the technical Education Committee amendments pending. The transcript then moved through a long agenda of bills and supplemental appropriations, with the committee generally hearing brief explanations from counsel, occasional member questions, and then voting to adopt amendments and report measures to the full Senate. Among the substantive policy bills, the committee advanced House Bill 4007 on the Industrial Access Road Fund, allowing an additional possible $3 million transfer in a fiscal year, expanding eligible uses, and increasing county/municipal spending limits; House Bill 4765, which raises salaries for state police, teachers, and school service personnel and, via a strike-and-insert amendment, creates a market pay enhancement tied to county and regional income data; House Bill 5162, recodifying tax lien sale procedures and clarifying ownership and government-property tax treatment; House Bill 5382, extending the Neighborhood Investment Tax Credit Program to July 1, 2031; House Bill 5685, authorizing up to $150 million in revenue bonds backed by excess lottery funds for State Culture Center improvements; House Joint Resolution 42, placing a constitutional amendment on the ballot to raise the homestead exemption from $20,000 to $40,000; House Bill 4010, creating an airport hangar grant program and fund; House Bill 4404, increasing from $500 to $5,000 the amount volunteer fire departments may spend on training and fire prevention materials; House Bill 4592, requiring standardized campus safety mapping data for higher education institutions; House Bill 4784, extending and making retroactive a qualified opportunity zone business tax modification; and House Bill 5088, increasing retirement benefits for Division of Natural Resources police officers, with a one-time $4.25 million cash injection. The committee also reported several supplemental appropriations and originating bills, including Senate Bill 842 for the Spay Neuter Assistance Fund, Senate Bill 846 for Culture and History capital repairs, Senate Bill 872 for Natural Resources capital repairs (reduced to $10 million in committee substitute), Senate Bill 876 for Department of Health facilities, Senate Originating Bills 1 through 5 covering Culture and History, road funds, corrections IT and services, tobacco education, and the Adjutant General’s armory board transfer, respectively. Most items were adopted by voice vote; House Bill 4765’s strike-and-insert amendment was adopted after a division vote of 10-6. The committee then adjourned.

Transcript Highlights:

• could increase exposure to revenue swings further.
• Again, this can result in gains to revenue or loss to revenue depending on the company.
• It may bring revenue to California, may lose revenue for California, depending on how profitable those
• stream and utilize that revenue stream.
• More state revenue isn't just a line item.

Summary: The joint informational hearing examined California’s taxation of multinational corporations, especially the state’s water’s-edge election versus worldwide combined reporting. The LAO and Franchise Tax Board explained the basic mechanics of unitary taxation, apportionment, and how water’s-edge generally excludes most foreign subsidiaries while worldwide reporting includes the full unitary group. FTB officials said water’s-edge filers are a small share of corporate filers but account for a large share of tax liability, and they described filing trends, industry mix, and the administrative steps needed to administer either system. Members and witnesses debated the policy trade-offs. Supporters of moving away from water’s-edge argued that it enables profit shifting, especially for large multinational and IP-heavy firms, and that eliminating it could raise significant revenue and improve fairness for smaller domestic businesses. They cited estimates of billions in potential revenue and said California already has the audit and reporting infrastructure to handle worldwide reporting, though some transition time would be needed. Opponents argued that worldwide reporting would tax foreign activity unrelated to California, create double taxation, increase compliance burdens and litigation, and could be difficult for foreign-based multinationals to document. They also warned that some of the revenue estimates are highly uncertain because foreign affiliate income is not directly observable. Committee members asked about foreign government pushback, the risk of companies leaving California, the effect on intellectual property shifting, and whether federal or Supreme Court action could block a change. Witnesses generally said major firms would be unlikely to leave because California taxes sales rather than physical presence, but some costs could be passed on to consumers. The panel also discussed alternatives such as conforming to federal international tax rules like NCTI/GILTI and adding anti-abuse rules. No vote or bill action was taken; the hearing was informational only.

Transcript Highlights:

• It could be, right, of course, that the revenues increase.
• Can someone walk me through how that calculation ended up being what it is?
• So anything on top of that will be based on a per-pupil calculation.
• Cabral, that LCFF is a couple hundred million dollars short of some calculation.
• Can you talk to me about your calculation to the number? Yeah, absolutely.

Transcript Highlights:

• Some are doing cost-versus-revenue analysis.
• The calculation wouldn't have changed.
• That's just a placeholder for calculations.
• That's a federally recognized way to calculate the FTE.
• So again, this is revenue neutral, and this is di- Proposal. So again, this is revenue neutral.

Committee: Joint Higher Education Funding Review Committee

Summary: The Higher Ed Funding Committee met to review a proposed process for identifying and addressing low-producing academic programs, then moved into discussion of draft funding formulas for the university system. Lisa Johnson of the ND University System described how other states and systems define low-producing programs, emphasizing multi-year enrollment and completion thresholds, cost and workforce review, and the role of governing boards. She reported that North Dakota institutions already review programs in varying cycles, often use shared resources and stackable credentials to keep low-enrollment programs viable, and cited recent system actions over five years: 100 programs placed on inactivation, 75 terminated, and 384 new programs created. Committee members raised concerns about workforce-critical programs, duplication, exemptions, and whether the legislature or the State Board of Higher Education should drive the process. The chair said he wanted the board to bring a detailed proposal to the June meeting and suggested the legislature may use funding leverage, including a possible holdback, to encourage the review process. The committee then heard a Legislative Council presentation on a draft funding formula for UND and NDSU. The proposal used fall census FTE enrollment, with a placeholder rate of $7,000 per undergraduate FTE and $10,500 per graduate/professional FTE, plus incentives for completions in high-demand fields and research productivity. Alex from Legislative Council explained that the formula also included separate treatment for research funding, external grants, and capital building tiers, and that the MD program at UND would remain fixed funding outside the formula. Members questioned the use of the placeholder rates, the in-demand program list, the treatment of external grants, and how the proposal compared with current appropriations. The chair noted that the formula numbers were illustrative and not final budget amounts. A second draft formula for the other nine institutions was also reviewed. It used fall census FTE with no weighted economic factor, a higher undergraduate rate of $8,750 per FTE, and completion incentives for in-demand credentials and all other credentials. Members noted that the proposal would benefit some institutions, such as Bismarck State College, while reducing funding for others, such as Mayville State, and questioned whether the same structure should apply across institutions with very different missions and sizes. Committee discussion focused on fairness, hold-harmless concerns, and whether the nine institutions should be grouped differently. The committee did not take formal action, but the chair indicated the formulas would continue to be discussed later in the meeting and in future work.

Transcript Highlights:

• </c><00:04:57.759><c> to</c> up some of the uh decline in Revenue to up some of the uh decline in Revenue
• Bell, it causes some real complexities relative to the calculation.
• Bell, it causes some real complexities relative to the calculation.
• All of that is calculations, and if you're wrong, then what?
• We need to have those revenue streams, but this is not the right way to do it.

Committee: House Transportation Finance and Policy

Transcript Highlights:

• And we calculate what the previous for the current year.
• In case we were not able to generate the revenue to cover the loss.
• So what is my explain a little bit about how the retention is calculated.
• The formula used to calculate retention is outlined directly in statute.
• Of the looking at slide tend those last calculations are those last calculations based on internal calculations

Transcript Highlights:

• calculation.
• </c><00:32:09.519><c> calculation</c><00:32:10.519><c> the</c> our compensatory Revenue calculation the
• our compensatory Revenue calculation the governor<00:32:11.000><c> is</c><00:32:11.200><c> recommending
• </c><00:32:30.799><c> in</c> to build into the calculation in to build into the calculation in addition
• calculations and determine if we are able to find a more consistent calculation that would reduce some

Committee: House Education Finance

Transcript Highlights:

• So depending on the final calculation, So depending on the final calculation for 2024-25 at certification
• The LAO explained to us today that for every dollar of revenue, either above our expected revenue or
• That only is the case if we actually see that revenue. Exactly.
• Because fixed costs have gone up higher than the revenue.
• , not even an increase in revenue.

Summary: The Assembly Budget Subcommittee on Education Finance met for its annual Proposition 98 overview, with Chair Alvarez outlining the committee’s focus on K-12 funding, student outcomes, and use of one-time funds. Superintendent Tony Thurmond gave an update on education issues, including wildfire recovery support for affected school communities, ongoing concerns about federal threats to education funding and immigration enforcement, progress on literacy and math, dual-language immersion, educator housing, and support for dual enrollment. Members broadly expressed support for these priorities, while also raising concerns about implementation, funding stability, and the need for schools to remain safe places for students. The committee then reviewed the Governor’s Proposition 98 proposal. The Department of Finance said the 2025-26 Proposition 98 guarantee is projected at $118.9 billion, with higher revenues and TK-related rebenching driving the increase. The LAO said the budget adds about $7.5 billion over two years and discussed the volatility of the guarantee, especially in 2024-25, when changes in revenue could have an outsized effect on school funding. Members questioned the proposed $1.6 billion delayed settle-up payment, the legal basis for delaying it, and the impact of possible federal funding freezes. The LAO presented alternatives such as a reserve deposit or delayed disbursement, while Finance said the proposal is intended to manage uncertainty. Members also raised concerns that ethnic studies implementation was not funded in the January budget, and Finance said the administration was not proposing funding for it. The committee next heard on the Proposition 98 rainy day fund and education deferrals. Finance said the reserve would receive a mandatory deposit of about $1.2 billion in 2024-25 and a discretionary deposit of $376 million in 2025-26, leaving a balance of about $1.5 billion. The LAO supported rebuilding the reserve as a way to manage volatility. On deferrals, Finance described the Governor’s plan to eliminate remaining deferrals by 2025-26, and the LAO said paying them off improves cash flow and budget resilience. Members generally supported eliminating deferrals and rebuilding reserves, though some asked about acting earlier if revenues allow. The committee also reviewed the proposed $1.8 billion student support and professional development block grant; Finance said it would fund professional development, recruitment and retention, and dual enrollment, while the LAO recommended clearer language on local discretion and use for one-time costs. Members were divided, with some supporting flexibility and others warning that one-time block grants can create instability and confusion for districts.

Transcript Highlights:

• You may remember that the underlying bill had a revenue distribution that was different from current
• In each fiscal year, the first $25 million of CCA auction revenue would go into the operating account
• Then the remainder of CCA revenue each year would go 68% to the carbon emissions reduction account.
• After it hits that cap, the rest of that portion of the revenue would go to the capital account.
• That anticipated revenue increase would move that fee collection to over $28 million.

Summary: The Appropriations Committee met in executive session on three bills. For House Bill 2159, which creates the pre-K Promise account for ECEAP, the committee adopted Amendment Clark 333 to clarify that account funds may support any children enrolled in ECEAP, not just the entitlement population. Members spoke in support of the bill as expanding early learning access, and the substitute bill was reported out with a due pass recommendation by a 29-0 vote, with two members excused. For House Bill 2251, dealing with Climate Commitment Act account structure and revenue distribution, staff briefed the proposed substitute and two offered amendments from Representative Dye. Both Dye amendments were rejected: one would have expanded allowable uses to include items such as buoys, trails, small forest landowner grants, drought and water quality projects, outdoor recreation, and marina support; the other would have restored annual rather than biennial reporting on CCA spending. Supporters said the bill would simplify and clarify CCA budgeting and better align spending with declining revenues, while opponents argued it did not sufficiently prioritize climate resiliency and accountability. The substitute bill was reported out with a due pass recommendation by an 18-12 vote, with one excused. For House Bill 2521, which would let the Washington State Patrol set firearm background check fees to cover program costs, the committee considered seven amendments. All seven were rejected: proposals to cap the fee increase at $20, exempt low-income residents, people near least restrictive alternative placements, veterans and active military, domestic violence victims, and residents of counties with fewer officers per capita, and to delay the effective date until Washington no longer has the fewest officers per capita nationwide. Supporters of the bill said the fee should be cost-based to avoid subsidizing the program with general funds and to prevent delays in background checks; opponents argued the bill created an open-ended fee increase and financial barrier to a constitutional right. The bill was reported out with a due pass recommendation by an 18-12 vote, with one excused.

Transcript Highlights:

• So, they were trying to keep it revenue neutral.
• . trying to keep it revenue neutral.
• It's actually it's not revenue neutral.
• These funds sales and use tax revenues.
• </c><00:23:17.920><c> when</c> to estimate expected revenues when to estimate expected revenues when

Bills: SF0052

Committee: Senate Appropriations

Transcript Highlights:

• And even though that revenue growth is slowing, we are still projecting moderate revenue growth well
• Um, much of the revenue, much of the other state funds revenue, 11 thing I wanted to point out on this
• Department of Health revenue sources, most federal revenues and DOH are in the public health and epidemiology
• A portion Does get Medicaid revenue and so there is a significant amount of federal Medicaid revenue
• Um, or matches the state for federal revenue.

Committee: House Federal Funding Stabilization Subcommittee

Transcript Highlights:

• The bill is estimated to reduce state revenues.
• There is no impact to state revenue.
• There is no impact to state revenue.
• There is no impact to state revenue.
• This amendment would eliminate the revenue impact for fiscal year 26 and proportionally reduce the revenue

Summary: The Ways and Means Committee met in executive session on March 2, 2026, and worked through two large groups of bills, hearing staff briefings, caucusing, and then voting each measure out to the Rules Committee. In the first group, the committee advanced bills on state accounts (HB 2675, with an amendment creating an adult day service facilities account), immigrant worker protections (2SHB 2105, after adopting a striker and Amendment 8 while rejecting amendments that would have changed enforcement and private rights of action), voting rights compliance (E3SHB 1710, with all proposed amendments rejected), AI content provenance and notices (E2SHB 1170, with Amendment 19 adopted to exempt state/local/tribal governments and certain video-game and technical uses), public official protections (2SHB 233, with a technical amendment adopted), WOTEC civil service coverage (HB 2249), JLARC work plan changes (HB 2120), LEOFF Plan 1 termination/restatement (E2SHB 2034, with several amendments adopted including creation of a pension surplus holding account and study directives, while proposals to redirect funds to the Climate Commitment Act or provide a lump-sum payment were rejected or withdrawn), supplemental retirement bargaining (HB 1069, with a striker adopted), port employee retirement exclusions (EHB 2179, with a striker adopted), local government revenue flexibility (ESHB 2442, with Amendment 72 adopted to remove a county public utility tax and other amendments rejected), wildfire mitigation funding (SHB 2089), and timberland REET changes (HB 1983). The committee also noted that it would not take action on some items in the packet, including SHB 1833. In the second group, the committee advanced bills on local housing tax remittance programs (ESHB 1717), renewable energy tax incentives and grants (E3SHB 1960, with a striking amendment adopted that adjusted rates, timing, and related provisions), nonprofit fundraising hall property tax relief (HB 2431), food bank sales tax relief (SB 6006), local tax increment financing (E2SHB 2451), temporary staffing services for nonprofit behavioral health entities (SB 6297), school and child care-related sales tax exemptions (SSB 6351, with a substitute adopted and the competing amendment made out of order), behavioral health work group extension and leadership council creation (2SHB 2429), Working Connections Child Care changes (SB 6353, with Amendment 43 adopted), language access guidelines for state agencies (SHB 2475), unpaid wage recovery (2SHB 2479), firearms background check fee authority (HB 2521, briefed but not acted on in the portion provided), public employee information sharing (HB 2091, briefed but not acted on in the portion provided), and Office of Independent Investigations jurisdiction changes (ESHB 2508, briefed but not acted on in the portion provided). Throughout the meeting, members and staff discussed fiscal notes, implementation costs, and whether amendments would increase or reduce state impacts, with several amendments aimed at narrowing scope, delaying implementation, or shifting enforcement and funding responsibilities.