Week 12 Legislative Summary

We are three days from recessing the 83 day old legislative session, and we have plans for a sine die date of May 1 to consider vetoes, to correct errors or oversights, or to consider proposed constitutional amendments.

We moved the two major appropriations to the state budget out of the House yesterday. One of the first items of business Friday was the passage of the 2007 Revenue Stabilization Act. We passed both the House version and the identical Senate version on Friday by a unanimous vote.

The Revenue Stabilization Act is the mechanism that facilitates a balanced budget and prevents deficit spending by allocating general revenue to the various fund accounts for state agencies by priority. As taxes are collected, they are distributed first to the funds and in the proportions set out in the A category, then the B category. HB2338 does not provide for a C category for this biennium. The bill sets a budget of $4.35 billion for fiscal 2008, which starts July 1, and $4.52 billion for fiscal 2009. State colleges and universities received a total increase of 10 percent, from the current fiscal year’s $644 million to $709 million in fiscal 2008. Substantial increases also went to the state Department of Correction, primarily to open two new units, and to the Department of Community Correction, primarily to hire 60 more probation officers. Pre-school programs saw an increase of about $40 million. Programs to help abused and neglected children will see an increase of $8 million.

Our RSA is unique in this country. It was enacted in 1945 after all taxes were earmarked and dedicated for specific purposes from the previous session -- some services became over-funded while others were short. For further explanation of the Arkansas budget process and for all revenue sources and funding for the state, click here.

Also Friday, we passed the 2007 General Improvement Fund Distribution Law out of the House. The General Improvement Fund consists of a portion of the state’s $919-million surplus. Public schools will receive $456 million of the surplus for repairs and constructions to provide a safe environment for our children and to satisfy Lake View concerns.

The House set up a system for GIF distribution for three main areas of funding: volunteer fire departments, senior citizen centers, and domestic violence centers. Members believe these three appropriations within HB2501, which route funding through various state agencies, are acceptable projects with a statewide impact considering the ruling in Wilson v. Weiss, where the Arkansas Supreme Court struck down some 2005 GIF appropriations as violative of Amendment 14 to the Arkansas Constitution prohibiting "special and local" legislation. The governor will have discretion over $187.8 million for various projects. The governor’s projects include $44 million to settle a dispute with the federal government stemming from the previous administration, $4 million to replace an aging state police airplane, $80 million for state highways, $25 million for the National U.S. Marshal Museum in Fort Smith, and a "quick action" account of $40 million for the governor to use in landing a major industry for location in Arkansas.

In addition, Texarkana and Miller County (and all cities and counties) will see a large increase in state turnback funds. Here are some specific figures which we can expect to see locally: Texarkana should receive $226,730.70 from this portion for turnback, and Miller County should receive $206,729.73. Turnbacks for cities is based strictly on per capita population, while turnback for counties based on a formula that distributes 75% equally among the counties while distributing the other quarter on a per capita basis.

Miller County should receive $57,600.00 of the $4,000,000 to be distributed for fire protection services (Act 833 funds). Domestic Violence Prevention of Texarkana should receive $30,000.00, and three senior citizen centers in Texarkana should receive $11,000 each: Miller County, Sandflat, and Texarkana Housing Opportunities. Each of the eight Planning & Development Districts will receive $250,000.00 and each state-supported college/university (two and four year institutions) will receive $100,000.00 of General Improvement Funding.

Two proposed constitutional amendments will be on the November, 2008 ballot. SJR4 asks voters to rid the 1874 Constitution of obsolete language (mainly regarding voting and elections) and shouldn't face much opposition. HJR1004 would allow annual meetings of the General Assembly, which currently meets in regular session only during odd-numbered years. I voted against this, as I believe it makes it tough for part-time legislators to set aside businesses as it is now -- I believe the current constitutional setup is sufficient for the legislative branch. I do see the benefits, however, of being able to control the budget and the various state agencies by reviewing their appropriations more frequently. It probably does give the legislature a little more oversight and effectiveness, both of which have eroded through the implementation of term limits and inexperience. If voters permit, the session during even-numbered years would be limited to budget matters. Such sessions also would be limited to 30 days but could be extended only once, by a maximum of 15 days. 46 states have legislatures that meet annually -- neither Arkansas nor Texas are among them.

It has been a smooth and effective session that included (1) public school legislation that should end the Lake View case and (2) the largest tax cut in Arkansas history. I anticipate that Monday and Tuesday will be light, as we'll mainly be concurring in any Senate amendments and passing Senate bills while considering what's left of the bills for consideration that are still working their way through committee. As always, don't hesitate to call or e-mail if I can be of service.