HB15-1261 Summary

• Replaces the term "target reserve" with "maximum reserve" set at 16.5% of annual cash fund expenditures, establishing a uniform default limit for state cash funds funded by fees.

• Grants the Joint Budget Committee authority to establish alternative maximum reserves or grant exemptions from reserve limits for up to three years when entities demonstrate specific needs like equipment purchases or short-term programs.

• Implements automatic spending restrictions through the State Controller when a cash fund exceeds its maximum reserve for three or more consecutive fiscal years, unless a waiver is approved.

• Adds new provisions allowing the State Controller to average uncommitted reserves over multi-year periods for entities with revenue-collection cycles or contract periods spanning multiple years.

• Repeals obsolete reserve limit exclusions effective July 1, 2017 for numerous cash funds while maintaining permanent exclusions for certain funds and exempting state institutions of higher education from these requirements.