In 1979, voters approved Proposition 4, establishing a maximum appropriations limit for the state and every local government jurisdiction. The state appropriations limit is often referred to as the Gann Limit, after Paul Gann, the author of the measure placing the limit in state constitution. In 1990, it was amended by Proposition 111.

The Gann Limit must be recalculated on an annual basis to determine that district expenditures do not exceed the limitations imposed by Proposition 4.