Restrictions on the Dedication of Revenue

Restrictions on the Dedication of Revenue via the Initiative

Updated August 3, 2006

Eleven states currently have restrictions on the use of the initiative with regard to appropriations and funding mechanisms.




No dedication of revenues or making or repealing appropriations.


If an initiative requires a reduction in govenment revenue or a reallocation from currently funded programs, the initiative text must identify the
program(s) whose funding must be cut or eliminated to implement the initiative. 
If the identified revenue source provided fails in any fiscal year to fund the entire mandated expendature for that fiscal year, the legislature may reduce the expenditure of state revenues for that purpose in that fiscal year to the amount of funding supplied by the identified revenue source. 


Measures that propose a tax or fee not in place in November 1994 require a 2/3 vote to pass. 


Expenditures in an amount in excess of available and unappropriated state funds remain inoperative until 45 days after the regular legislative session, unless the measure provides for raising new revenues adequate for its operation.


May not be used to make a specific appropriation from the treasury. However, if such a law, approved by the people, is not repealed, the legislature must raise by taxation or otherwise and appropriate such money as may be necessary to carry such law into effect.


Sponsor must identify in the text of the initiative the amount and source of revenue required to implement the initiative. Initiatives requiring a reduction in government revenue or a reallocation from currently funded programs must identify the program(s) whose funding must be reduced or eliminated to implement the initiative.


May not appropriate money other than new revenues created and provided for by the initiative.


May not appropriate money.


No measure that interferes with the Legislature's ability to direct taxation of necessary revenues for the state and its governmental subdivisions.


No appropriations or other expenditures of money, unless such statute or amendment also imposes a sufficient tax or otherwise constitutionally provides for raising the necessary revenue.

North Dakota

No appropriations for the support and maintenance of state departments and institutions.


No dedication of revenues or making or repealing appropriations.

Source: National Conference of State Legislatures, April 2002.

Pros & Cons

Initiative measures that mandate the expenditures of large amounts of public revenue without including a new dedicated revenue source (such as taxes or fees) can make it difficult for the legislature to continue to fund existing state services and programs. In addition, initiatives that increase or create new taxes to fund new or existing programs negatively affect the legislature's ability to impose reasonable taxes to fund necessary programs for citizens.

For more information on Initiative and Referendum - please contact Jennie Drage Bowser[I and R].

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