CSG Midwest Question of the Month: Do states in the Midwest require fiscal notes that estimate the impact of proposed legislation on local governments?

Through either statutory provisions or legislative rules, most states in the Midwest have policies to ensure that lawmakers understand the monetary impact of proposed bills on local governments.  A 2013 CSG Midwest survey of nonpartisan legislative service agencies (which provide these fiscal estimates for lawmakers) highlighted the different policies employed by the region’s legislatures. In some instances, fiscal notes are only prepared upon request.

Under South Dakota’s joint legislative rules, for example, a request can be made by a legislative committee chair, a majority of members on the committee, or the presiding officer of the House or Senate. An individual member may also ask for a fiscal note; this request is granted if one-fifth of the members in the legislative chamber support it.

In Minnesota, a local impact note must be prepared if requested by the chair or ranking member of the spending and taxing committees.

Illinois’ Fiscal Note Act puts the initial decision in the hands of the bill’s sponsor — he or she decides whether to get projections on the proposal’s local fiscal impact. However, other legislators can subsequently request such a fiscal note, and this request must be granted if a majority of the legislative body supports it.

In addition to the information provided in fiscal notes, Ohio law requires legislative staff to prepare a local impact statement whenever a bill would result in additional costs for counties, townships, municipalities or school districts. For these types of bills to be voted out of an Ohio legislative committee, members must first receive the local impact statement. And if a bill is amended, a revised local impact statement is required, unless two-thirds of the committee members vote to pass the measure.

Iowa’s joint legislative rules call for fiscal notes on any measure that could have an annual impact of at least $100,000 or a five-year effect of $500,000 (as determined, at least initially, by legislative staff).

In Indiana, a fiscal note is attached to all proposed bills and includes an estimate of the impact on local governments. Similarly, general fiscal-note requirements are in place in Kansas, Nebraska, North Dakota and Wisconsin.

A two-bill package introduced this fall in Michigan (HB 5059 and HB 5060) calls for creation of the Local Government Mandate Panel. This eight-member group would include five individuals representing Michigan’s local governments. If the panel determines that proposed legislation would increase costs for local governments, it would develop a detailed fiscal note to inform legislative deliberations

Stateline Midwest ~ December 20131.76 MB