Beebe: Arkansas ‘fortunate’ to be in good fiscal shape

Gov. Mike Beebe delivered his latest State of the State address Tuesday (Jan. 11) to Arkansas lawmakers telling them he was “fortunate” to be in his position and the state was "fortunate" to be in sound fiscal shape.

Comparing Arkansas’ relatively stable state budget to other states that are in trouble, Beebe said that legislators cannot rest on their laurels, according to this report from Talk Business.

“That we do not face such crises here is a source of pride but it should not be a source of contentment,” Beebe told members of the 88th General Assembly, the Arkansas Supreme Court, newly sworn in constitutional officers, and a packed gallery full of observers.

“We have worked well together before and that partnership must remain,” Beebe said in a hint of bi-partisanship.

He outlined major concerns in education, highways, Medicaid, prisons and the budget. Saying that prisons and Medicaid were experiencing “unsustainable growth,” the Governor suggested that “there are no quick solutions and real change will take time.”

Part of his cost-containment strategy involved moving Medicaid away from a fee-based model to a results-based model, exploring a self-imposed tax on Medicaid providers, and making better use of electronic health records.

On prisons, Beebe said the choice will be whether to raise taxes to pay for prison beds or turn dangerous criminals loose. He said his steps for curtailing spiraling costs – estimated at another $1 billion over the next decade – would be “rooted in common sense” and with “public safety being top of mind.”

He outlined vague proposals to alter drug statutes with heavier penalties for those in the drug trade, not drug users, and he has increased funding by $4 million to the Department of Community Punishment for more parole-oriented programs.

Quoting North Little Rock Police Chief Danny Bradley, Beebe said, “We’re not talking about being tough on crime, we’re talking about being smart on crime.”

On the education front, Beebe has proposed increasing per student funding for K-12 public schools by two percent and higher education budgets by one percent.  Claiming Arkansas continues to move up the rankings of national reports — #6 in K-12 education improvements, according to the latest Quality Counts report from Education Week —Beebe said, “This does not signal an end to our work.”

He also said that he wants to see college graduation rates double in Arkansas by 2025.

Beebe reiterated his interest for another half-cent cut to the grocery tax. State lawmakers have filed a number of bills aimed at cutting additional taxes.

“It’s the only responsible approach is to say where that money will come from,” Beebe said in regard to additional tax cuts.  “Abstract claims of hypothetical future growth” won’t cut it, he added.

“Everyone likes tax cuts and politically everyone wants tax cuts,” Beebe said. But he warned that Arkansas’ economy was still in a tenuous recovery and reckless tax cuts could accelerate funding gaps in Medicaid and prisons.

In closing, Beebe encouraged legislators and the public to set higher goals and expectations for results. He said we should stop comparing ourselves to Mississippi and look for stronger national rankings to compete against.

He also reiterated his respect for the General Assembly, where he served for more than 20 years.

“You are the first branch of government established by our founding fathers for a real good reason,” said Beebe, noting that the legislative branch sets the budget and establishes the laws that govern the land.

“Together, together, let’s put our head on our pillow and say we left it [the state] better than we found it.”