The bill proposes the repeal of the budget reserve account and reallocates its functions to the general fund. Key changes include the transfer of funds that would have previously gone to the budget reserve account, such as withheld funds from community-based mental health or substance abuse programs, which will now revert to the general fund at the end of the biennium. The governor is mandated to recommend maintaining a reserve amount within the general fund, and the process for transferring unobligated fund balances to the legislative stabilization reserve account is outlined. Additionally, the bill establishes provisions for interfund loans, with a cap of $60 million, and clarifies the interest rates based on previous fiscal year's pooled fund investment rates.

Moreover, the bill modifies the distribution of severance tax revenues, capping annual distributions from the severance tax distribution account at $155 million, with any excess credited to the general fund. It also mandates that all funds in the budget reserve account be transferred to the general fund by July 1, 2026, and that any unexpended funds previously appropriated from the budget reserve account will be paid from the general fund. The state auditor is tasked with reporting on the amounts transferred under this act by October 31, 2026, and again by October 31, 2027. The act is set to take effect on July 1, 2026.