B. For the 2nd year of the biennium, the General Fund appropriation limit limitation is the General Fund appropriation limitation of the first year of the biennium biennial base year appropriation multiplied by one plus the growth limitation factor in subsection 2.

Sec. 4. 5 MRSA §1535, as enacted by PL 2005, c. 2, Pt. A, §5 and affected by §14, is amended to read:

§1535. General Fund transfers to stabilization fund

Baseline General Fund revenue, as recommended by the Revenue Forecasting Commission Committee and authorized in accordance with chapter 151-B, and other available budgeted General Fund resources that exceed the General Fund appropriation limitation established by section 1534 plus the additional cost for essential programs and services for kindergarten to grade 12 education under Title 20-A, chapter 606-B over the fiscal year 2004-05 appropriation for general purpose aid for local schools until the state share of that cost reaches 55% of the total state and local cost must be transferred to the stabilization fund. The State Controller, at the close of each fiscal year, shall transfer the available balance remaining in the General Fund to the stabilization fund after all required deductions of appropriations, budgeted financial commitments and other adjustments considered necessary by the State Controller.

Sec. 5. 5 MRSA §1536, sub-§1, as enacted by PL 2005, c. 2, Pt. A, §5 and affected by §14, is amended to read:

1. First priority reserve. The State Controller shall, as the first priority at the close of each fiscal year, reserve transfer from the unappropriated surplus of the General Fund an amount equal to the excess of total baseline General Fund revenue received over accepted estimates in that fiscal year and transfer that amount at the beginning of the next fiscal year as follows:

A. Thirty-two percent to the stabilization fund;

B. Thirty-two percent to the Retirement Allowance Fund established in section 17251; and

C. Sixteen percent to the Reserve for General Fund Operating Capital.