Cities are required to establish an appropriation limit for a new fiscal year by June 30 of the current fiscal year in accordance with Article XIIB of the California Constitution Gann Initiative. Each year the appropriation limit is modified by two factors. One factor is a population-based factor; the second is an economic –based factor. The population factor that may be selected is the greater of the percentage increase in the City’s population or the County’s population. The economic factor that may be selected is either (a) the percentage change in the state’s per capita personal income or (b) the percentage change in the City’s assessed valuation caused by new non-residential construction.
Appropriation Limit Calculations