NC H727

Proposes a constitutional amendment to limit annual state spending growth to the sum of inflation plus state population growth, with increases only allowed by two-thirds vote in both legislative chambers.

Creates an Emergency Reserve Fund (capped at 3% of annual spending) for declared emergencies requiring two-thirds legislative approval, and a Budget Stabilization Fund (capped at 15% of annual spending) for revenue shortfalls.

Directs excess revenues beyond the spending limit first to the Emergency Reserve Fund, then to the Budget Stabilization Fund, with any remaining excess used to pay down unfunded liabilities in state retirement systems or returned to taxpayers through tax relief.

Prohibits transfers of state cash fund principal to the General Fund (except from the two reserve funds) and prevents cash fund appropriations that would supplant General Fund spending.

Requires the state to fully fund any new or expanded programs/services imposed on local governments and maintains the proportion of state revenue distributed to local governments at 2018 levels; amendment requires voter approval in November 2018 general election with implementation July 1, 2019.