Rhode Island General Laws Title 35. Public Finance § 35-3-20.1. Limitation on state spending

(a) For the fiscal year ending June 30, 2009, no appropriation, supplemental appropriation, or budget act shall cause the aggregate state general revenue appropriations enacted for the fiscal year to exceed ninety-seven and eight tenths of one percent (97.8%) of the estimated state general revenues for the fiscal year from all sources, including estimated unencumbered general revenues not continued or reappropriated to the new fiscal year remaining at the end of the previous fiscal year. Estimated unencumbered general revenues are calculated by taking the estimated general revenue cash balance at the end of the fiscal year less estimated revenue anticipation bonds or notes, estimated general revenue encumbrances, estimated continuing general revenue appropriations, and the amount of the budget reserve and cash stabilization account at the end of the fiscal year. The amount of the general revenue estimate and estimated unencumbered general revenue remaining shall be determined by the state controller and approved by the auditor general in conformance with accounting procedures currently in use. The excess of any unencumbered general revenue shall be determined by subtracting from the actual unencumbered general revenues at the end of any fiscal year an amount which together with the latest estimated general revenues is necessary to fund the ensuing fiscal year's general revenue budget, including the required estimated general revenue supplemental and annual appropriations. Provided further, the applicable percentage shall decrease by two-tenths of one percent (.2%) for the succeeding four (4) fiscal years as follows:

(b) The amount between the applicable percentage in subsection (a) and one hundred percent (100%) of the estimated state general fund revenue for any fiscal year as estimated in accordance with subsection (a) shall be appropriated in any given fiscal year into the budget reserve and cash stabilization account; provided, that for the fiscal year ending June 30, 2009, no payment will be made which would increase the total of the budget reserve and cash stabilization account to more than three and four-tenths of one percent (3.4%) of only the estimated state general fund revenues as set by subsection (a). In the event that the payment to be made into the budget reserve and cash stabilization account would increase the amount in the account to more than three and four-tenths of one percent (3.4%) of estimated state general revenues, the amount shall be transferred to the Rhode Island Capital Plan fund, to be used solely for capital projects. Provided further the applicable percentage shall increase by four-tenths of one percent (.4%) for the four (4) succeeding fiscal years as follows:

However, there shall be no expenditures of money under this section without passage of a specific appropriation by the general assembly.

(c) Within forty-five (45) days after the close of any fiscal year, all unencumbered general revenue in the year end surplus account from the fiscal year shall be transferred to the general fund.