Section 3 Proposed System (Transition) Notes

Transition. The proposed transition from the present system to the proposed system for funding state government is described in Section 5, Proposed Fiscal System (Transition).

Investment Revenue. During transition the withdrawal from the endowment would have a sustainable (Investment Revenue) component, which would be available for general purpose spending. It would be 4.60 percent of the six-year trailing average market value of the endowment.

Other Revenue. In addition to Investment Revenue, Other revenue is available for general purpose spending. It consists of Other Revenue (non-tax) and Other Revenue (tax). The larger part of Other Revenue is the tax revenue, which consists of the taxes paid by individuals, ordinary corporations and, except for production taxes, oil corporations.

Investment Capital. During transition the withdrawal from the endowment would have an unsustainable (Investment Capital) component, which would be available for general purpose spending.

Spend. Spend is in the amount of the assumed budget. But if Total Non-Tax alone can fund the assumed budget, Spend is equal to Total Non-Tax. [Thus, as presented here, only the tax revenue needed to supplement Total Non-Tax is shown.]

Fiscal Planning. A fiscal plan generally calls for a decrease in spending and an increase in revenue. Adoption of a new fiscal system may or may not be accompanied by fiscal planning. To do some fiscal planning under the proposed system, use the planning options by inserting values different from those that have already been inserted as examples.